Position Letter from EDIG:

1. The April 2, 2002 NDA (attachment (C)) was superseded and replaced by the October 22, 2002 agreement (attachment (d)).

2. The October 22, 2002 agreement expired on October 22, 2005.

3. There are no contractual agreements in effect between the parties limiting eVU's market access.
    

    

April 2, 2002 NDA:

The information disclosed as proprietary information under the referenced NDA was limited in scope to a market opportunity with Alaska Airlines for a portable entertainment device. Mr. Boyer, at the time an e.Digital shareholder and employee of Alaska Airlines, approached e.Digital based on e.Digital’s audio/visual media technology. At the time of e.Digital’s and Mr. Boyer’s first meeting, e.Digital’s technology portfolio included the world’s first multi-codec MP3 player, the first Flash-based handheld voice recorder, MicroOS™, multiple versions of security, encryption and Digital Rights Management, a complete reference design for an Audio/Video player which was used for the Alaska Airlines demonstration, as well as other technology and designs relevant to portable audio/video players and systems. The NDA includes a non-compete, however this is limited in scope to the proprietary data disclosed. (i.e. a market opportunity with Alaska Airlines). e.Digital signed the NDA in good faith without knowledge of what Mr. Boyer was going to disclose. Mr. Boyer disclosed a market opportunity with Alaska Airlines.

October 22, 2002 Agreement:

Prior to entering into the October 22, 2002 agreement, the parties realized that e.Digital was in sole possession of technical IP relevant to the undertaking and that APS had disclosed a market opportunity on Alaska Airlines, therefore the 10/22/02 agreement was drafted without an anti-compete clause. In addition, the agreement clearly cites the use of e.Digital’s patented technology, trade secrets and know how. Consequently, it was clear that the new agreement should supersede the previous agreement and in fact become the entire understanding between the parties. The agreement thus includes Paragraph Q. “ENTIRE AGREEMENT”. 

The October 22, 2002 Agreement subsequently expired on 10/22/05