SD Bash edig meeting 2/26/01 10 am
Let me start by stating that all of us who attended the meeting will keep our shares of edig, we will definitely not sell, and are in fact buyers at these prices.
OZ, Chincha, zeroman, sunpoop and bonsall met with RP for about 1 ½ hours. After signing for security badges, we were escorted into the back conference room. RP opened the meeting by showcasing the TREO player, and the 500mb dataplay and 350mb IBM storage devices. We each took a turn listening to the Treo’s superb sound quality. RP stated that the company realizes that revenue will drive share price. Revenues will not flow until product is released and that edig’s “serious money” will be made with the reorders, because reorders are the true test of consumer acceptance. RP would not venture into revenue projections, but by asking questions a different way, we were able to get a sense of where the company thinks they are going financially (question 2).
Since we had met at Chincha’s the night before, we had questions prepared, and RP preferred the format of responding to questions, rather than delivering a scripted speech. All answers are paraphrased but substance-wise accurate (other attendees please correct me if I misquoted RP).
Here are some of the questions:
1) Where do you see edig 1 and 3 years from now? This year it’s the coming out with products, some relatively soon, like the Treo, Jukebox; and others in the fall, like the Data-Play products. We should also see some voice enabled products THIS YEAR. In 3 years edig hopes that it’s technologies will be the world standard. He mentioned that edig would be in many products; VTT and TTV would be very big, OEM’s are working to have books and libraries on the mini discs. We are in the best place we’ve ever been in as a company, and we’re in the best part of the current technology sector. Hand held devices are and will be very big. There have been a total of 10 million palm devices sold, but this does not compare to the huge cell phone industry. Future cell phones will do much more than just make and receive calls, there will be many voice features and download capabilities. There were 420 million cell phones purchased just last year, and we could be bigger than cell phones. Our current agreements call for us to receive $3-$14 per device.
2) Financials: What is eDig’s burn rate? $250K-$300K/month, Follow up –Since cash on hand is approximately $4million, and if you do not get any revenues soon, you’ll be out of business in 13 months – are you looking for additional financing or other funding at this time? NO – we have all the funding we need, we are not looking for money, we’re very strong financially. (This means they have a good handle on revenues and when they will be coming in).
3) What is the main role of the new PR firm? Is it primarily for the OEM’s or consumer? The PR firm was hired to get the word out and to coincide and precede product introduction.
4) When do you plan to re-apply to Nasdaq? When the price stabilizes above $5.00. We don’t anticipate the acceptance process will take as long as last year.
5) Have any of your engineers left voluntarily? NO, they have all stayed and desire to continue to work here; we did let one engineer go. They are all upside on their stock options and are working hard to put a good product out so that the share price will increase.
6) Can you comment about shareholder interface with OEM’s at CES? We don’t blame shareholders for trying to find out information about edig and it’s products, but sometimes it makes our position more difficult. Shareholders must also understand that we are dealing with many different OEM’s, and many competing OEM’s. All with different standards and technologies. These OEM’s share their proprietary secrets with us and we are bound by Non-disclosure agreements, the OEM’s do not want their competing OEM’s to know what they are doing. We have had to apologize to some OEM’s and explain that all our shareholders were doing was trying to find out more about their investment.
In the interest of getting some of the word out, I will post this much now and will post the remainder later in the day.
Bonsall
AI
