phoenix: Your moniker sparked a analogy in my mind. IMO the only possible chance e.Digital might have to survive in the long run is to do what the legendary Pheonix bird did, destroy itself in fire and emerge reborn from its ashes.
e.Digital needs a fresh start with all new management and BOD. A turnaround team would downsize the company by immediately eliminating all unnecessary/non-productive personnel and overhead to minimize cash burn and then re-build the company as revenue is received.
Any cash that is generated from sales of the 100 million newly-authorized shares would then go a lot farther and could be put to productive use instead of squandered as has been the case with all of the past stock sales.
That said, it's probably too late to stop the financial nosedive. The company has negative net worth, a serious working capital deficit and its only customer is fading into the sunset (in fact, I believe it has already eliminated gross profit margins).
There are still a substantial number of Series D and EE convertible preferred shares outstanding as well as two large loans, one of which is has a convertible feature nearly identical to the preferred shares.
As the new shares are registered and sold (or the other way around), the share price will spiral down. It would be essential that the financiers be willing to work with the company to keep it alive.
Putnam and his gang seem intent to keep the status quo until stock sales are no longer feasible. At that point the unpaid financiers would foreclose and own what is left and could cover any fraud or malfeasance that has occurred over the past several years.
If I were a shareholder, I'd be doing my best to get that gang out now and an ethical outsider to investigate what has really been going on and see if anything can be done to stop what seems to be inevitable at this point.
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