Filed by Bowne Pure Compliance





EXHIBIT 10.2




AMENDMENT TO

CONFIDENTIAL SETTLEMENT AGREEMENT

AND RELEASE




This Amendment to the Confidential Settlement Agreement and Release (“Amendment”) is entered
into on July 10, 2008, being the last day on which all parties sign this Amendment (the “Effective
Date”), by and between Verizon Federal Inc. (“Verizon”); and Government Telecommunications, Inc.
(“GTI”) and GTI’s parent company, Digital Angel Corporation (“DAC”); collectively referred to here
as the “Parties.”



WHEREAS, Verizon, GTI and DAC are parties to a certain Confidential Settlement Agreement and
Release effective as of December 19, 2007 (the “Agreement”);



WHEREAS, the parties wish to amend the Agreement because GTI and DAC represent that GTI’s
parent, Computer Equity Corporation (“CEC”) is being acquired by Sterling Hallmark, Inc..



NOW, THEREFORE, in consideration of the respective promises set forth here, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties hereby agree as follows.



A. This Amendment shall have no effect if the anticipated acquisition of GTI’s parent company,
CEC, by Sterling Hallmark, Inc. does not occur.



B. Sections 1.1-1.6 of the Agreement are hereby deleted in their entirety and replaced with
the following:




	 	1.1.	 	The payment of One Million Dollars ($1,000,000) by GTI to Verizon on or
before January 15, 2008, has been made.







	 	1.2.	 	On or before the closing date of the Stock Purchase Agreement by and
between DAC and Sterling Hallmark, Inc. (the “Closing Date”), GTI shall pay to
Verizon the sum of One Million Five Hundred Thousand Dollars ($1,500,000.00) by
wire transfer into M&T Bank, 1 M&T Plaza, Buffalo, NY 14203, Account 18199708,
Routing Number 22000046, and shall simultaneously telecopy proof of that wire
transfer to Verizon as provided in Section 5.12 of the Agreement.







	 	1.3.	 	GTI shall pay to Verizon, by execution and delivery of a promissory
note, the original principal amount of Two Hundred Fifty Thousand Dollars
($250,000.00), payable on or before ninety (90) days after the Closing
Date, in one (1) installment together with interest at five percent (5%) per annum
and otherwise in the form of Attachment A hereto.





 


 









 






	 	1.4.	 	GTI shall pay to Verizon, by execution and delivery of a promissory
note, the original principal amount of Seven Hundred Fifty Thousand Dollars
($750,000.00), payable on or before one hundred eighty (180) days after the Closing
Date, in one (1) installment together with interest at five percent (5%) per annum
and otherwise in the form of Attachment B hereto.







	 	1.5.	 	The settlement shall finally settle and resolve all claims asserted, or
which could have been asserted, by Verizon, GTI, and DAC in the Lawsuit as of the
date of this Agreement, including, but not limited to, legal expenses.






C. Attachment B (the “Guaranty”) to the Agreement executed by DAC on December 19, 2007, is
hereby rescinded, and the Guaranty is hereby released and terminated and shall be of no further
force and effect.



D. The promissory note executed by GTI in favor of Verizon for the sum of Four Million Dollars
($4,000,000.00) is hereby canceled and shall be returned by Verizon to GTI immediately upon receipt
of the payment required by Section 1.2 of this Amendment.



E. Sections 3.0, 3.1 and 3.2 of the Agreement are hereby deleted in their entirety.
Attachment A to the Agreement executed by GTI on December 19, 2007 is hereby rescinded and shall
have no further force or effect.



F. The miscellaneous terms and conditions of Section 5.0 of the Agreement shall each be
applicable to this Amendment as of the Effective Date.




G. The terms of the Agreement remain in force except as modified by this Amendment.



[Remainder of page intentionally left blank. Signature page follows.]



 


 









 





IN WITNESS THEREOF, the Parties have fully executed this Amendment as of the date of the last
signature below.



	 	 	 
	Government Telecommunications, Inc.

	 	Verizon Federal Inc.
	 
	 	 
	/s/ Stephen K. Wood

	 	/s/ Mary Coyne
	 

	 	 
	Signature

	 	Signature
	 
	 	 
	Stephen K. Wood

	 	Mary Coyne
	 

	 	 
	Printed Name

	 	Printed Name
	 
	 	 
	President

	 	Associate General Counsel
	 

	 	 
	Title

	 	Litigation
	 

	 	 
	 

	 	Title
	 
	 	 
	July 10, 2008

	 	June 30, 2008
	 

	 	 
	Date

	 	Date
	 
	 	 
	Digital Angel Corporation
	 	 
	 
	 	 
	/s/ Lorraine M. Breece
 

Signature

	 	   
	 
	 	 
	Lorraine M. Breece
 

Printed Name

	 	   
	 
	 	 
	Senior Vice President and Chief Financial Officer
 

Title

	 	   
	 
	 	 
	July 10, 2008
 

Date