Sentinel, I also agree with you on your speculation that e.Digital is paid a fixed fee per unit. I also see evidence that makes it seem at minimum to be an educated guess.
Because the SEC filings make it clear that under the agreement with APS, e.Digital is responsible for manufacturing the devices, yet payment to EDIG is to be in the form of NRE fees, licensing fees and royalties. The filings do not state that e.Digital will be paid for manufacturing costs. I believe that e.Digital is using the term "royalties" to mean payment per unit.
Furthermore, since mgmt has stated that "royalties" on this device are up to "several hundred dollars per unit," I believe that further backs up that concept since it is very unrealistic to believe that a royalty for simply for using MOS would be in the "several hundred dollar range" on a $1,000 device.
My take on the situation is that Boyer negotiated a fixed price for these units plus engineering/design fees and e.Digital took the risk as to whether or not the actual cost was higher. Hopefully, they got a similar deal with Digitalway to counteract that risk.
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