Replies to post #54243 on e.Digital Corporation (fka EDIG)

[Cassandra]

Chip: Although it would not surprise me, I have no idea if they will register more shelf shares in this S-3. My comment was merely saying that 20 million would cover only the shares required to be registered for the two financings and not provide additional shelf shares.

However, I went back and calculated the number of shares needed for the Series D convertibles and realized that my memory of it being more than 11 million was in error. The actual number is a little less than 11 million. I'm sorry for my error.

As is stands now, 19,947,369 additional common shares are required (10,789,474 for the Series D and 9,157,895 for the Series E), which is roughly 13% dilution to existing shareholders.

If they registered 20 million, they would have about 53,000 extra shares. However, considering that they sell shelf shares below market, at the current share price they would likely raise less than $25,000. Additionally, if there are any of the about to be registered shares remaining after all of the Series D and E shares are converted, they could use those as shelf shares.

[newelong]

chipperca ... I don`t agree either, but ...

for a different reason. The Company just received $1,200M for 2,838M shares @ $.45, and they will have have to issue 1,712M, plus another 856M shares, if all warrants are exercised @ $.60 and $1.00, respectively ... the warrants would generate a cash infusion of $1.800M for a total package of $3,000M from a total of 5,406M shares of common stock ... [The maximum number of shares of Common Stock that e.Digital is required to issue upon conversions of the Series E Stock and payment of dividends thereon in shares of Common Stock is 9,157,895, except as may be subsequently modified as a consequence of certain possible penalties and other adjustments]

Now add this maximum amount to the 10,789M due the Series D CP Shareholders, and you get a grand total of 19,947M additional shares, or a total outstanding of 171,188M shares based on the total outstanding as of 11-17-03 [this does not include the 4,839M shares reserved for the stock option plan].

Anyone who believes that e.Digital will reguire more than an additional $1.8MM over the next 12 months should substantiate the need and give good reason [compared to the Company`s progressive plan] as to why they would expect the shareprice to go anyway, but gradually up. JMOFWIW

NEWE.LONG