e.Digital Corporation (fka EDIG)

[Cassandra]

Upcoming S-3 Registration:

Has anyone given any thought about the likely impact of the S-3 registration of millions more common shares that must be filed no later than 6/30/03? These are required by the covenants of the Series D Convertible Preferred shares. The dilution could be 30% or more from this registration.

Last year's S-3 filing for 20 million new common shares caused a massive decrease in share price. The share price was $1.08 on the day of the initial filing and was down to the 80 cent range by the time the registration was effective. Then as the shelf shares began to be sold, the price continued to move down with each subsequent sale.

What are investors thinking will happen with this looming round of dilution?