e.Digital Reports Second Quarter Results

SAN DIEGO, CA — (Marketwired) — 11/13/13 — (OTCQB: EDIG), a long standing source of innovation and future-defining patented technologies, today announced results for its second quarter of fiscal 2014, ended September 30, 2013.

: Through its law firm, Handal & Associates, the Company has entered into license and settlement agreements with a number of defendants. A majority of the recent settlements negotiated during the current quarter are in the process of being finalized and documented. The Company expects additional settlements before the end of the calendar year. During the last quarter, the Company filed a notice of appeal to the Federal Circuit Court of Appeals, challenging the August 21, 2013 collateral estoppel ruling that could have an impact on the course of future litigation against non-settled parties.

: The United States Patent and Trademark Office has granted the Company a new patent, US 8,572,440, titled System and Method for Managing Information Stored in Semiconductors. This patent is the foundation of the Company-s newly created microSignet IP portfolio. The Company has already filed a continuation patent application that it expects will further strengthen the portfolio.

The Company is marketing its Nunchi patent portfolio through a modified licensing strategy involving the assistance of its law firm, Handal & Associates.

“Our legal team at Handal & Associates has worked very hard navigating the challenges presented by the defendants in our current litigation activities,” commented Fred Falk, president and CEO of e.Digital. “Good progress has been made and as a result, we anticipate increased cash receipts through the balance of the current round of license and settlement activities. We remain dedicated and financially prepared to defend our patents through trial against any defendants who infringe our technologies and do not settle and license. We anticipate that the proceeds from the current round of settlements will help fund our overall litigation and licensing strategy, not only for our Flash-R patents but for our Nunchi and microSignet patents as well. e.Digital-s litigation activities have created an awareness in the industries and among current licensees, of our Nunchi and microSignet patents and have opened the door for serious licensing discussions for those patents, leading us to expand our relationship with Handal & Associates. Although the Company reported a financial loss for fiscal Q2, we expect increased patent license revenues for the current quarter based on the recent settlements and current negotiations,” concluded Falk.

The Company reported a net loss of $410,113 or $(0.00) per share, for the second quarter of fiscal 2014 compared to a net loss of $376,005 or $(0.00) per share for the prior year-s second quarter. For the second quarter of fiscal 2014 revenues totaled $101,729 compared to $124,949 for the second quarter of the prior year. The most recent quarter included $34,725 of patent license revenues compared to $2,000 for the second quarter of the prior year. Operating expenses increased to $511,842 from $500,954 for the prior year-s comparable quarter primarily due to increased patent-related legal costs.

For the six months ended September 30, 2013 the Company reported a net loss of $481,550 or $(0.00) per share on revenues of $551,187. For the comparable six months of the prior year the Company reported a net loss of $708,988 or $(0.00) per share on revenues of $257,495. The Company-s results are impacted by the timing and amount of license fees.

For more than 20 years, e.Digital-s ideas and inventions have impacted the evolution of consumer products. Today, e.Digital innovations, including its Flash-R portfolio of flash memory-related patents, are essential to many portable consumer electronic products. The Company pioneered dedicated portable in-flight entertainment systems and more than 30 airlines have made e.Digital powered products their in-flight entertainment choice. For more information about e.Digital, please visit: .

All statements made in this document, other than statements of historical fact, are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act. You should not place undue reliance on these statements. We base these statements on particular assumptions that we have made in light of our industry experience, our ability to protect and monetize our IP portfolio, expected future developments and other factors that we believe are appropriate under the circumstances. These forward-looking statements are based on the then-current expectations, beliefs, assumptions, estimates and forecasts about the businesses of the Company and the industries and markets in which the Company operates. Actual outcomes and results may differ materially from what is expressed or implied by the forward-looking statements. More information about potential factors that could affect the Company can be found in its most recent Form 10-K, Form 10-Q and other reports and statements filed with the Securities and Exchange Commission (“SEC”). e.Digital Corporation disclaims any intent or obligation to update these or any forward-looking statements, except as otherwise specifically stated by it.

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