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Exhibit 10.1
 
 
Second Amendment To Loan Documents
 
 
THIS SECOND AMENDMENT TO LOAN DOCUMENTS (the “Amendment”) is dated as of June
28, 2005 by and between APPLIED DIGITAL SOLUTIONS, INC., a Missouri corporation
having an address of 1690 South Congress Avenue, Suite 200, Delray Beach,
Florida 33445 (the “Borrower”), and INFOTECH USA, INC., a Delaware corporation
having an address of 7 Kingsbridge Road, Fairfield, New Jersey 07004 (the
“Lender”).
 
 
Recitals
 
A. On or about June 27, 2003, the Lender made a loan to the Borrower in the
original principal amount of $1,000,000 (the “Loan”).
 
 
B. The Loan is evidenced and secured by, among other things, the following loan
documents, all of which are dated June 27, 2003 and all of which were amended by
that certain First Amendment to Loan Documents, dated June 29, 2004, between the
Borrower and the Lender (collectively, the “Loan Documents”):
 
 
(i) Commercial Loan Agreement between the Borrower and the Lender.
 
 
(ii) Term Note from the Borrower to the Lender (the “Note”).
 
 
(iii) Stock Pledge Agreement from the Borrower to the Lender.
 
 
C. The Borrower and the Lender have agreed to amend the Loan and the Loan
Documents, all on the terms and conditions set forth in this Amendment.
 
 
NOW, THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
 
 
Agreement
 
1. Defined Terms. Capitalized terms used in this Amendment and not otherwise
defined shall have the meanings given to such terms in the Loan Documents.
 
 
2. Extension of Maturity Date. The Loan Documents are hereby amended to provide
that the Maturity Date of the Loan is extended for one (1) year from June 30,
2005 to June 30, 2006. Without limiting the generality of the foregoing, the
definition of the term “Maturity Date” set forth in the Note is hereby changed
from “June 30, 2005” to “June 30, 2006.”
 

 
 

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3. No Defenses. The Borrower acknowledges that, as of the date hereof, the
outstanding principal balance of the Loan is $1,000,000. The Borrower
acknowledges and agrees that, as of the date hereof, it has no offsets,
counterclaims or defenses of any nature whatsoever to its obligations to the
Lender under the Loan Documents.
 
4. Representations and Warranties. In order to induce the Lender to enter into
this Amendment and to amend the Loan Documents as provided herein, the Borrower
hereby represents and warrants to the Lender that:
 
(a) All of the representations and warranties of the Borrower set forth in the
Loan Documents are true, complete and correct in all material respects on and as
of the date hereof with the same force and effect as if made on and as of the
date hereof and as if set forth at length herein.
 
(b) No Event of Default presently exists and is continuing on and as of the date
hereof.

(c) The Borrower has full power and authority to execute, deliver and perform
any action or step which may be necessary to carry out the terms of this
Amendment, and this Amendment has been duly executed and delivered by the
Borrower and is the legal, valid and binding obligation of the Borrower
enforceable in accordance with its terms, subject to any applicable bankruptcy,
insolvency, general equity principles or other similar laws affecting the
enforcement of creditors’ rights generally.

(d) The execution, delivery and performance of this Amendment will not (i)
violate any provision of any existing law, statute, rule, regulation or
ordinance, (ii) conflict with, result in a breach of, or constitute a default
under (A) the certificate of incorporation or by-laws of the Borrower, (B) any
order, judgment, award or decree of any court, governmental authority, bureau or
agency, or (C) any mortgage, indenture, lease, contract or other material
agreement or undertaking to which the Borrower is a party or by which the
Borrower or any of its properties or assets may be bound, or (iii) result in the
creation or imposition of any lien or other encumbrance upon or with respect to
any property or asset now owned or hereafter acquired by the Borrower, other
than liens in favor of the Lender.

(e) No consent, license, permit, approval or authorization of, exemption by,
notice to, report to, or registration, filing or declaration with any person is
required in connection with the execution, delivery and performance by the
Borrower of this Amendment or the validity thereof or the transactions
contemplated thereby.

 
 

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5. Counterparts. This Amendment may be signed in several counterparts, each of
which shall be an original and all of which shall constitute one and the same
instrument.
 
 
6. No Change. Except as expressly amended by this Amendment, all of the terms
and provisions of the Loan Documents shall continue unmodified in full force and
effect, and the same are hereby ratified and reaffirmed in their entirety.
 
 
7. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of New Jersey.
 
 
8. Wells Fargo Contingency. Notwithstanding anything to the contrary contained
in this Amendment, it is understood and agreed that this Amendment and the
amendments to the Loan and the Loan Documents effected hereby are expressly
conditioned and contingent upon the prior written consent of Wells Fargo
Business Credit, Inc.
 
IN WITNESS WHEREOF, the undersigned have caused their duly authorized
representatives to execute and deliver this Amendment as of the date set forth
on the first page hereof.
 

 
Applied Digital Solutions, Inc.
 
By: /s/ Evan C. McKeown
Name: Evan C. McKeown
Title: Senior V.P., Chief Financial Officer
 
InfoTech USA, Inc.
 
By: /s/ J. Robert Patterson
Name: J. Robert Patterson
Title: Vice President, Chief Financial Officer