``...Based on the pre-arbitration hearing motions filed by Fujitsu Ten`s attorneys and the responses of the arbitration panel, it became apparent that while e.Digital would likely prevail in the arbitration, the damages to be awarded were likely to be limited to the manufacturing margin and royalties of the intial HD 1213 order. Rather than expend significant resources to hold the arbitration hearing, a mutual settlement was arrived at by both companies and their attorneys. Please call me at your convenience if you wish to discuss this further.

Best regards,

Robert Putnam

Sr. Vice President``

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IMO, it seems fair to me if the $200K is the margin and royalty on the disputed PO. Unless EDIG could prove IP theft, they got the cash that they would have received if the PO were produced under the terms of the PO.

Also, I would guess F10 agreed to pay EDIG should they use the same IP in the future. I doubt F10 got away with a one time fee and can now use EDIG`s tech without additional cost.

Nope, not a cool million, but, IMO, EDIG would have never made a million on anything to do with F10. Again, the $200K pays the light bill for a month....better than a sharp stick in the, uh...eye.

John