Applied Digital Assists in Hurricane Katrina Disaster Relief and Emergency Management Efforts; VeriChip(TM) Technology Being Used by State of Mississippi.

DELRAY BEACH, Fla. -- Applied Digital (NASDAQ:ADSX), a leading provider of identification and security technology, announced today that it has provided more than 360 VeriChips(TM) and five scanners to Harrison County, Mississippi, to assist in Hurricane Katrina relief and recovery efforts. Additionally, 200 VeriChips and two scanners were sent to Lafayette County, Mississippi, to assist in any future disaster and recovery procedures.

At the request of the State of Mississippi Department of Health, the Company has lent its 40-foot mobile clinic to act as the Department of Health's Mobile Clinic. This vehicle is specifically retrofitted for medical procedures such as chip-injection. The vehicle is being staffed by Department of Health representatives and is now providing food, water and medical supplies, including tetanus and other vaccinations, to people in need of medical care. Over 1,000 individuals have received medical treatment at the mobile medical unit in the first five days of its operation.

The VeriChip has the capability to provide medical information in critical care situations such as Hurricane Katrina, where individuals requiring emergency care may not have access to their medical records. With the VeriChip's unique identification number, which can be scanned into a database, emergency medical personnel can gain immediate access to a patient's medical records.

To date, the Company has donated approximately 560 VeriChips to Harrison and Lafayette Counties in Mississippi. Initially, Harrison County and the U.S. Disaster Mortuary Operational Response Team (DMORT) are utilizing VeriChip's identification technology to integrate identification of the unidentified deceased with a database provided by the County and the Georgia Bureau of Investigation so that loved ones may access the information to identify missing family members that may have perished in this disaster. The County Coroner in Harrison County, MS, and DMORT are now using this technology. The County Medical Examiner's office in Lafayette County, MS, intends to store the VeriChips and scanners for future pending disaster relief and body identification assistance. Applied Digital has offered to donate its technologies to Louisiana and the DMORT facility located in St. Gabriel, LA, as well.

"Applied Digital is committed to helping local residents affected by Hurricane Katrina in any way possible," said Scott R. Silverman, Applied Digital's Chairman and CEO. "The VeriChip was designed for emergency care situations and secure identification. Although its primary application is to access and retrieve medical records in an emergency and clinical environment, there are clear uses for our technology in disaster management. As future disaster management plans are re-organized after this disaster, we intend to offer VeriChip and all of our identification technologies to disaster management experts, DMORT and the federal government."

About Applied Digital -- "The Power of Identification Technology"

Applied Digital develops innovative identification and security products for consumer, commercial, and government sectors worldwide. The Company's unique and often proprietary products provide identification and security systems for people, animals, the food supply, government/military arena, and commercial assets. Included in this diversified product line are RFID applications, end-to-end food safety systems, GPS/Satellite communications, and telecomm and security infrastructure, positioning Applied Digital as the leader in identification technology. Applied Digital is the owner of a majority position in Digital Angel Corporation (AMEX: DOC).

Statements about the Company's future expectations, including future revenues and earnings, and all other statements in this press release other than historical facts are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as that term is defined in the Private Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties and are subject to change at any time, and the Company's actual results could differ materially from expected results. The Company undertakes no obligation to update forward-looking statements to reflect subsequently occurring events or circumstances.