GUARANTY
Exhibit 10.2
For value received, Applied Digital Solutions, Inc., a Delaware corporation (“ADSX”)
absolutely and unconditionally guarantees payment, when due, to Verizon Federal Inc., a Delaware
corporation (“Verizon”) of the amounts agreed to be paid to Verizon by Government
Telecommunications, Inc., a Virginia corporation, (“GTI”) under that Confidential Settlement
Agreement and Release, dated December 19, 2007, among ADSX, GTI and Verizon (the “Agreement”).
This Guaranty will take effect when signed by both ADSX and Verizon and will continue in full
force and effect until all amounts owed under the Agreement shall have been paid in full. Verizon
shall provide ADSX with prompt written notice in the event GTI fails to pay any amounts due under
the Agreement. ADSX shall have ten (10) days from receipt of such notice to cure GTI’s failure to
pay.
This Guaranty and the obligations arising hereunder shall be governed by, and construed in
accordance with, the laws of the state of Virginia. All disputes, controversies, or claims arising
out of or in connection with this Guaranty shall be litigated in any court of competent
jurisdiction in Fairfax County, Virginia. Each party hereby accepts jurisdiction of such state and
agrees to accept service of process as if it were personally served within such state. ADSX shall
pay upon demand all of Verizon’s costs and expenses incurred in connection with the enforcement of
this Guaranty, including without limitation reasonable attorney fees, whether or not litigation is
commenced and at trial and on appeal.
Verizon hereby subordinates to the rights of ADSX’s senior secured lenders, Laurus Master
Fund, Ltd. and its affiliates (collectively, the “Lenders”), any and all rights to payment of
amounts due hereunder except as set forth in that Subordination Agreement dated as of even date
herewith, between Verizon and the Lenders.
Verizon agrees to exhaust all remedies against GTI and its successors and assigns prior to
enforcing its rights under this Guaranty. ADSX hereby waives all legal and equitable defenses to
which ADSX might be entitled under this Guaranty. Inconsistencies between this Guaranty and the
Agreement will be governed by this Guaranty. This Guaranty may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute one and the same
instrument.
(signature page follows)
| Applied Digital Solutions, Inc. | ||||
By: |
/s/ Xxxxxxxx X. Xxxxxx | |||
Name: |
Xxxxxxxx X. Xxxxxx | |||
Title: |
SVP, ACFO | |||
Date: |
December 19, 2007 | |||
| Verizon Federal Inc. | ||||
By: |
/s/ Xxxx X. Xxxxx | |||
Name: |
Xxxx X. Xxxxx | |||
Title: |
Associate General Counsel, Verizon Business | |||
Date: |
12/19/07 | |||
