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                                                               Exhibit 10.41


                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                                Page 1 of 31

                    INTERNATIONAL DISTRIBUTION AGREEMENT
                    ------------------------------------

         This Agreement, to take effect as of the date of its signature by
both parties hereto, is by and between VeriChip Corporation, a Delaware,
U.S.A. corporation having offices at 400 Royal Palm Way, Palm Beach, FL
33480, United States of America (hereinafter referred to as "VeriChip" or
the "Company"), and RussGPS, Ltd., a business entity duly organized and
existing under the laws of Florida principal offices at, Central Telegraph
Building, Tverskaya Str., 7, Moscow Russia, (hereinafter referred to as
"Distributor"). Distributor and the Company may hereinafter be referred to
as the "Parties" and individually, as a "Party".

                                 WITNESSETH:

         WHEREAS, VeriChip markets highly sophisticated identification devices
and readers; and

         WHEREAS, due to the technical nature and use of the Company's
products, users may be properly served only if they have the benefit of
professional pre-and post-sale demonstration, orientation, training and
support; and

         WHEREAS, Distributor has represented to the Company that
Distributor possesses experience in the distribution of products and that it
has and will maintain the technical, financial and human resources required
to explain, demonstrate and service the Company's products in a proper
manner; and

         WHEREAS, Distributor wishes to be appointed the Company's exclusive
distributor for the marketing, promotion, sale and services within the
Territory (as hereinafter defined) of the Company's products listed in
EXHIBIT "B" attached hereto (the "Products"); and the Company wishes to make
such appointment, subject to the terms and conditions of this Agreement.

         NOW, THEREFORE, in consideration of the mutual covenants and
conditions hereinafter contained, the Parties hereby agree as follows:

                           SECTION 1. DEFINITIONS

In this Agreement, capitalized terms shall have the meanings set forth in
this Section 1. Definitions, or elsewhere in the provisions of this
Agreement:

(a)      "Agreement" means this "International Distribution Agreement", and
         any and all Exhibits referenced herein, signed by both Parties.

(b)      "Company Confidential Information" means all of the Company's
         information already in the possession of, or subsequently obtained
         by, Distributor, either (1) in writing and marked with a
         restrictive legend, such as "Confidential", or (2) in writing,
         orally, visually or by delivery of items which are, at the time of
         disclosure or within (thirty) 30 days after its disclosure,
         identified as confidential information, all to the extent that such
         information or material has not been made publicly available by the
         Company. The use of "Company Confidential Information" is subject
         to the provisions of Section 13, hereof.

(c)      "Date of Delivery" is the date the Product ordered by Distributor
         is delivered F.O.B. in the Territory to Distributor's agent.



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
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(d)      "Date of Shipment" is the date a Product is shipped to Distributor
         from the Company's distribution center in the U.S.A., as such date
         is shown in the corresponding bill of lading.

(e)      "Effective Date" means the date this Agreement is accepted by the
         Company, as evidenced by the signature of the Company's
         representative.

(f)      "End User" or "User" is anyone who acquires Products within the
         Territory for its own use and not for resale.

(g)      "Price List" means the list of the Company's wholesale list price
         for the Products, as quoted by the Company from time to time. The
         Company's List Price in effect as of the date hereof is attached
         hereto as EXHIBIT "C" - Price List.

(h)      "Product" or "Products" means each of the Company's product or
         products listed in EXHIBIT "B" - Products, attached hereto, and any
         copy or part thereof, documentation, updates, or other materials
         delivered to Distributor by the Company in conjunction with the
         Products.

(i)      "Purchase Order" means the form attached hereto as EXHIBIT "A" -
         Form of Purchase Order for Products, as the Company may amend it
         from time to time.

(j)      "Quota" means the minimum quantities of Products which Distributor
         shall purchase from the Company, as set forth in EXHIBIT "D" -
         Quota Requirements, attached hereto.

(k)      "Reseller" means anyone who acquires Products from Distributor
         within the Territory for resale to End Users.

(l)      "Territory," means the country or countries listed in EXHIBIT "E" -
         Territory, attached hereto.

(m)      "Trademarks" means any trademarks, service marks and trade names
         which the Company may at any time have adopted, used or registered,
         which identify either the Company or the Products, or are used by
         the Company in relation to and in connection with the Products.

(n)      "US" or "U.S.A." means the United States of America.

               SECTION 2. APPOINTMENT OF EXCLUSIVE DISTRIBUTOR

2.1      Subject to the terms and conditions of this Agreement, the Company
         hereby appoints Distributor as the Company's exclusive distributor
         of Products in the Territory. During the Term of this Agreement, as
         such term is defined in Section 12 below, Distributor shall have
         the exclusive right to market, promote, sell and provide services
         for the Products in the Territory, under the Company's name and
         Trademarks. Distributor hereby accepts such appointment and
         expressly acknowledges and agrees that, pursuant to this Agreement,
         Distributor shall only have the rights of Distributor expressly
         granted by the Company hereunder. Distributor further agrees that
         it shall promote and maintain the excellence of quality and enhance
         the goodwill which is now associated with the name and reputation
         of the Company and its Products. Distributor acknowledges that, by
         accepting this appointment, it will be subject to all of the terms
         and conditions of this Agreement and to the Company's marketing,
         sales and merchandising



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                                Page 3 of 31

         policies as they now exist or as they may be altered, at the Company's
         sole discretion, from time to time, provided, however, that the
         Company shall provide Distributor with a 30 (thirty) day prior
         written notice, and provided also that the Company will not make
         any changes that impose a material burden on Distributor unless
         such changes are reasonably necessary to comply with any
         applicable law, regulation or governmental order or to improve
         the prospects of the business. Distributor's failure to operate
         in accordance with such policies shall entitle the Company
         to terminate this Agreement in accordance with Section 16.2 (a)
         hereof.

2.2      Distributor agrees that (i) it will market, promote and sell the
         Products solely to Resellers, if any, and/or Users within the
         Territory; (ii) whenever Distributor places orders for Products it
         will do so solely under the Company's authorized form of Purchase
         Order, which expressly references and incorporates the terms and
         conditions of this Agreement; and (iii) all such Purchase Orders
         must be issued and signed by Distributor and must be accepted in
         writing signed by the Company. Distributor further agrees that it
         will market, promote, and offer for sale solely those Products the
         Company specifically approves under this Agreement, as such are
         listed in EXHIBIT "B" hereto, or in any amendment that, from time
         to time, the Company makes to it in a writing signed by the
         Company, and that any Purchase Order Distributor submits to the
         Company will list only such approved Products. Distributor shall
         not, without the prior written consent of the Company, sell, market
         or distribute any version of the Products other than the version
         the Company shall designate from time to time as the most current
         version. Distributor shall not sell, advertise or solicit orders
         for the Products outside the Territory and shall promptly relay any
         such inquiries to the Company.

         In addition, if Company desires to offer any new version of the
         products, or any new products, then it shall notify Distributor of
         such desire and shall provide Distributor with a right of first
         refusal to distribute such new versions or new products under the
         terms and conditions of this Agreement.

2.3      Nothing in this Agreement shall be construed as prohibiting or
         placing any restrictions whatsoever on the Company's right (i) to
         market, promote, distribute, license or sell any Products outside
         the Territory to or for the benefit or use of any person, firm or
         company the Company may select in its sole discretion, provided
         that any such agreement between the Company and that any such
         person, firm or company shall include a clause where such person,
         firm or company agrees not to may intend to use or resell the same
         Products within the Territory; or (ii) to appoint other
         distributors of the Products outside the Territory that may sell
         Products outside the Territory, provided that any such agreement
         between the Company and any such distributors, shall include a
         clause where such distributors agree not resell or distribute the
         Products within the Territory. Notwithstanding the foregoing, the
         Company will instruct its other distributors not to export Products
         to the Territory. If the Company is contacted by someone or some
         entity in or out of the Territory requesting to buy Products in the
         Territory (i.e. shipped to within the Territory), then the Company
         shall refer such person or entity to Distributor.

2.4      In partial consideration of the distribution rights granted by the
         Company to the Distributor hereunder, Distributor shall pay to the
         Company a non-recurring and non-refundable fee in the amount of One
         Dollar, US$1.00 (the "Distribution Fee").



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
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         Distributor hereby expressly agrees that the Distributor Fee shall
         not in any way or under any circumstances be credited against or
         applied to amounts due for any Products ordered by Distributor
         under this Agreement, including without limitation, Products
         ordered pursuant to Section 7.2 below.

                      SECTION 3. PARTIES' RELATIONSHIP


The Parties hereby agree that:

3.1      Distributor is an independent contractor and not an agent of the
         Company. This Agreement does not constitute a joint venture, agency
         or partnership between the Parties, nor does it create an
         employer-employee relationship. Neither Party is a legal
         representative, partner, franchisee, employee or associate of the
         other, legally or otherwise.

3.2      Neither Party has the power to assume nor will assume or create any
         obligations on behalf of the other, nor make any representations or
         warranties about the other. Distributor has no power, express or
         implied, to accept any order on behalf of the Company or to bind
         the Company, either directly or indirectly, with respect to any
         order or with respect to any other contract or matter whatsoever.

3.3      As an independent contractor, Distributor is free to select its
         sales personnel and establish their compensation, and manage its
         business as it deems appropriate, provided such management is not
         in contravention of any policies prescribed by the Company or in
         contravention of the terms of this Agreement. Distributor may
         appoint sub-distributors within the Territory, provided that
         Distributor informs any such sub-distributor of the applicable
         rules and regulations (both contained herein and any other
         applicable rules and regulations) and Distributor is responsible
         for any breach thereof by any such sub-distributor.

                SECTION 4. GENERAL OBLIGATIONS OF DISTRIBUTOR

4.1      Marketing. In the marketing, promotion and sales of Products,
         ---------
         Distributor shall act on its own behalf, and for its own account,
         except as otherwise specifically stipulated in this Agreement, or
         as separately agreed to in writing by the Parties, and shall sell
         the Products at its own prices and under its own terms and
         conditions. With respect to the marketing and distribution of the
         Products, Distributor shall have the following obligations:

         (a)      To use its best efforts to further the promotion, marketing
                  and distribution of the Products in the Territory;

         (b)      To maintain, at its own expense, appropriate offices and
                  a full range of available Products. Company may provide
                  Distributor with free samples for demonstration purposes;

         (c)      To establish and maintain an adequate organization,
                  infrastructure, personnel and marketing strategy for its
                  marketing, promotion and sale of the Products in the
                  Territory;

         (d)      To maintain an adequate balanced inventory of the
                  Products, sufficient to fill reasonably anticipated orders
                  from customers and to actively promote orders for the
                  Products. During any subsequent contractual period,
                  Distributor shall purchase such minimum quantity of
                  Products as established by mutual agreement between the
                  Parties from time to time;



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
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         (e)      To promptly respond to all inquiries from customers,
                  including complaints, process all orders, and effect all
                  shipments of Products;

         (f)      To pass on or flow-through to its Resellers, if any, and
                  Users any warnings and cautions and other descriptive
                  literature regarding the proper use of all Products, as
                  provided by the Company;

         (g)      Upon reasonable notice to Distributor, permit the Company
                  to visit Distributor's place of business and inspect its
                  inventories, service records, and other relevant
                  documents;

         (h)      To maintain throughout the Territory, at Distributor's
                  sole expense, an adequate sales force dedicated to the
                  marketing, promotion and sale of the Products;

         (i)      To participate actively in sales or merchandising programs
                  prepared by the Company; to participate in all fairs and
                  exhibitions in the Territory where such participation
                  would, in the judgment of the Company, promote the
                  Products, and to develop and implement sales programs for
                  the promotion of the Products. The costs associated with
                  such participation shall be previously agreed by both
                  parties;

         (j)      To assist the Company in all local tax and government
                  reports or any other local requirements. The Company will
                  compensate Distributor for any costs which might be
                  incurred by Distributor in providing such assistance,
                  provided such costs have been approved by the Company in
                  advance;

         (k)      From time to time during the Term of this Agreement and
                  upon expiration or termination hereof, Distributor will
                  provide the Company immediately upon request with a list
                  of the names and addresses of all persons to whom
                  Distributor has sold the Products and all information
                  concerning the sale of the Products which the Company may
                  require. The Company agrees and understands that this
                  information will be considered as Distributor proprietary
                  and confidential information, and therefore it shall be
                  treated as confidential by the Company, in terms of this
                  Agreement.

4.2      Advertising. Distributor shall diligently undertake to advertise
         -----------
         the Products in the Territory. The Company will furnish
         Distributor, from time to time and without additional charge, with
         such marketing and technical materials in the English language as
         the Company may, in its sole discretion, deem necessary or
         desirable (the "Promotional Materials"). Distributor may, solely
         during the Term of this Agreement, utilize such Promotional
         Materials in promoting sales of the Products and in preparing its
         own advertising materials. Distributor may, in its own discretion,
         translate such Promotional Materials from English into the language
         of the Territory for distribution in the Territory, but shall
         provide a sample of them to the Company prior to any distribution.
         Distributor shall bear all costs of this translation and shall be
         solely responsible for inaccurate, inconsistent or misleading
         translations. The Company shall have ownership rights to all
         advertising and promotional materials so translated. All expenses
         incurred by Distributor with respect to the creation and
         distribution of advertising materials, advertising and promoting
         the Products in an adequate fashion shall be borne by Distributor.
         Distributor may use the Promotional Materials and the full range of
         direct marketing media, including home shopping, spot, long form
         television, direct mail, telemarketing, live shows, radio and print
         advertisements, catalog, Internet and retail, in the marketing and
         promotion of the Products in the Territory, to the extent the
         Company, in its sole discretion, deems Distributor to have such
         ability. Upon expiration or termination of this Agreement,
         Distributor shall promptly return to the Company, at no cost to the
         Company, all advertising and Promotional Materials translated or
         prepared by Distributor.



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
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4.3      Internet. Distributor shall follow the Company's written
         --------
         instructions with respect to each of the following: (i) use of any
         information about the Company or the Products available on the
         Internet; (ii) linking of any site on the Internet to any other
         site on the Internet established, operated or sponsored by the
         Company; and (iii) use of any of the Trademarks or Promotional
         Materials on any site on the Internet. Distributor acknowledges
         that it shall cease the activities described in (i), (ii) and/or
         (iii) above, if so instructed by the Company. In no event shall
         Distributor establish, operate, sponsor or contribute content to
         any site on the Internet which incorporates the word "verichip" as
         its URL address or any part of such address.

4.4      Customer Support. Distributor shall handle and promptly settle any
         ----------------
         User's customer complaints concerning the Products, following the
         Company's guidance included in the Company's operations guide
         provided by the Company to Distributor (the "Operations Guide"), as
         amended from time to time in the sole discretion of the Company,
         provided however, that the Company shall provide Distributor with a
         30 (thirty) day prior written notice of any such change.
         Distributor agrees to assist the Company in arranging for any
         customer warranty service.

4.5      Expenses. Distributor assumes full responsibility for all costs and
         --------
         expenses which it incurs in carrying out its obligations hereunder,
         including but not limited to all rentals, salaries, commissions,
         advertising, demonstrations, travel and accommodation expenses
         without the right to reimbursement for any portion thereof from the
         Company.

4.6      Other General Obligations Of Distributor. Subject to all applicable
         ----------------------------------------
         laws and regulations in the Territory, Distributor undertakes the
         following obligations within the Territory on a continuing basis:

         (a)      Adherence to Business Ethics and Laws
                  -------------------------------------
                  Distributor shall adhere to the highest principles of
                  business ethics and in this regard shall:
                  (1) comply with all laws and regulations in the Territory;
                  (2) adopt a set of business conduct guidelines (the
                      "Guidelines"), to be furnished to all its employees and
                      others who represent Distributor to the public.
                      Distributor shall ensure that all such persons
                      clearly understand that they must comply with the
                      Guidelines. The Guidelines shall incorporate
                      provisions that:
                      (i)   prohibit the making of payments or gifts for the
                            purpose of influencing a decision to award or to
                            continue business with Distributor;
                      (ii)  require compliance with all laws and regulations
                            in the Territory, including without limitation,
                            Government procurement laws;
                      (iii) require fair and equitable treatment for
                            organizations, agencies, companies and enterprises;
                      (iv)  require that representations be accurate;
                      (v)   require handling of intellectual property in
                            accordance with the rights granted to Distributor;
                      (vi)  require sales and business practices in keeping
                            with the principles of free competition and
                            business ethics and conduct;
                      (vii) require full and accurate reporting to
                            appropriate authorities and to Distributor;
                  (3) monitor compliance with the above provisions; and
                  (4) notify the Company promptly upon discovery of any
                      instance where Distributor fails to comply with any
                      one or all of the provisions of this Section.



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
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                  Further, Distributor hereby recognizes and agrees
                  to comply with the U.S. Import/Export regulations, the
                  Foreign Corrupt Practices Act and laws concerning
                  International Economic Boycotts, together with other U.S.
                  laws, to the extent that they are applicable to U.S.
                  companies in their international operations. Without
                  limiting the generality of the foregoing, Distributor
                  agrees not to re-import the Product back into the United
                  States and agrees that the Products and all packaging
                  materials will be marked "made in the U.S.A. for export
                  only".

         (b)      Contacts with the Press and Other Media
                  ---------------------------------------
                  Distributor shall not make any statement or distribute any
                  material concerning the Company to the press or other
                  communications media, except for (i) materials provided to
                  Distributor by the Company for publication and (ii)
                  statements and materials otherwise approved in writing by
                  the Company. Distributor shall promptly bring to the
                  Company's attention and deliver to it copies of any
                  articles in the press of the Territory concerning the
                  Company and/or the Products of which Distributor may be
                  aware.

         (c)      Audits
                  ------
                  The Company will have audit rights of Distributor's
                  operations on: (i) adherence to Distributor's Guidelines
                  by Distributor's employees and others who represent
                  Distributor to the public, (ii) compliance with U.S.
                  Government Import/Export Regulations and the U.S. Foreign
                  Corrupt Practices Act, (iii) use and storage practices for
                  the Company Confidential Information, (iv) use of the
                  Trademarks; and (v) where there is suspicion of breach of
                  other provisions of Distributor's agreements and other
                  contractual documents. The Company agrees to give
                  Distributor's management no less than five (5) business
                  days prior written notice before exercising any of its
                  Audit rights.

          (e)     No Exports Outside the Territory
                  --------------------------------
                  Distributor shall not sell any Products outside of the
                  Territory and shall use its best efforts to ensure that
                  Products it sells are not resold outside of the Territory.

4.7      Distributor's Representations and Warranties. Distributor hereby
         --------------------------------------------
         represents and warrants to the Company that: (i) Distributor is a
         business organization duly organized and in good standing in
         accordance with the laws of The United States; (ii) Distributor has
                                     -----------------
         duly authorized the execution and performance of this Agreement;
         (iii) this Agreement is lawful and may be performed in accordance
         with its terms under all the laws in force in The United States as
                                                       -----------------
         of the date hereof; (iv) Distributor will advise the Company of any
         changes in the laws which might or will impair the validity of all
                    ---
         or any part of this Agreement; and (v) Distributor is a business
         organization with the required personnel duly trained to market and
         sell products similar to the Products, and has the capacity to
         obtain through third parties transportation to distribute such
         Products, warehouses to store them and a computer system which
         allows a detailed control of stocks and sales.

          SECTION 5. GENERAL OBLIGATIONS OF THE COMPANY; WARRANTIES

5.1      The Company agrees to use its commercially reasonable efforts to
         sell Products to Distributor during the Term of this Agreement, on
         such terms and prices as set forth herein and in EXHIBIT "C",
         attached



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
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         hereto, but in no event shall the Company be liable to Distributor
         for any loss of profits, loss of business, expenses or costs
         arising from or alleged to arise from any failure to deliver.
         Distributor hereby agrees that the Company shall have the right to
         allocate Products, in its sole discretion and in whatever manner it
         deems to be in its best interest, among its distributors without
         incurring any liability to Distributor.

5.2      The Company warrants that the Products and its software components
         will be free from defects in material and workmanship and will
         substantially conform to its publicly available specifications. The
         Company shall replace or repair, at its option, any Products that
         within thirty (30) days from the Date of Delivery to the
         Distributor are found defective in its materials, workmanship or
         specifications, upon written notification by Distributor
         identifying each and every defect. The Company's obligation with
         respect to such Products or software, shall be limited to its
         repair or replacement, without any further expense to the Company.
         Any alteration, abuse, modification or misuse, including, but not
         limited to, neglect or accidental damage or defacement of the
         Products shall void this limited warranty. THE FOREGOING LIMITED
         WARRANTY IS EXPRESSLY MADE IN LIEU OF ANY AND ALL OTHER WARRANTIES,
         EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED
         WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
         The foregoing limited warranty shall not be enlarged or affected
         by, and no liability or obligation shall arise from, the Company's
         rendering of technical or other advice, or of service, in
         connection with any of the Products. Employees, agents,
         distributors and sales representatives are not authorized to make
         warranties. Oral or written statements made by them do not
         constitute warranties and shall not be relied on by Distributor.
         REPLACEMENT, OR REPAIR OF A DEFECTIVE PRODUCT IS DISTRIBUTOR'S SOLE
         AND EXCLUSIVE REMEDY FOR CONTRACT, WARRANTY, NEGLIGENCE, TORT OR
         STRICT LIABILITY CLAIMS FOR ANY LOSS, DAMAGE OR EXPENSE ARISING OR
         ALLEGED TO ARISE FROM THE MANUFACTURE, SALE, DELIVERY OR USE OF THE
         PRODUCTS. IN NO EVENT SHALL THE COMPANY BE LIABLE FOR LOSS OF USE
         OR PROFITS, LOSS OF BUSINESS, EXPENSES OR COSTS ARISING FROM OR
         ALLEGED TO ARISE FROM BUSINESS INTERRUPTION, ATTORNEYS' EXPENSES OR
         CONSEQUENTIAL, CONTINGENT, INCIDENTAL OR SPECIAL DAMAGES CAUSED OR
         ALLEGED TO BE CAUSED IN WHOLE OR IN PART BY THE NEGLIGENCE, TORT,
         STRICT LIABILITY, BREACH OF CONTRACT, BREACH OF WARRANTY OR OTHER
         BREACH OF DUTY OF OR BY THE COMPANY. Distributor shall obtain
         shipping instructions and a return material authorization from the
         Company for the return of any item under this warranty provision.
         Compliance with such instructions shall be a condition precedent to
         the Company's repair or replacement options hereunder.

5.3      The Company shall make commercially reasonable efforts to provide
         Distributor with the latest Product information and, upon
         Distributor's request, any information concerning the technical
         aspects of the Products, their use and application.

5.4      The Company does not guarantee the results of, and Distributor will
         not be entitled to rely on, any  marketing  plan of the Company.

5.5      The Company represents that: (i) it is a corporation duly
         incorporated and in good standing under the laws of the State of
         Delaware, United States of America; and (ii) it has duly authorized
         the execution and performance of this Agreement. The Company will
         notify Distributor about the approval,



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         disapproval or any other significant event or information regarding
         the medical device approval for the Products in the USA.

                       SECTION 6. ORDERS FOR PRODUCTS

6.1      Purchase Orders. Distributor shall submit its Purchase Orders for
         ---------------
         Products to the Company in writing, by e-mail, telex, fax,
         telegram, cable or any other electronic means. All Purchase Orders
         shall refer to this Agreement, and shall list the Products ordered,
         quantities, applicable prices, scheduled delivery dates, delivery
         point, shipping instructions and any other information deemed
         necessary by the Company. In case of conflicts or inconsistency
         between the terms and conditions of this Agreement and those set
         forth in any Purchase Orders, acceptances, correspondence, and
         other documents forming part of any order during the Term of this
         Agreement, this Agreement shall govern and prevail, and the
         conflicting or inconsistent terms and conditions of any such other
         documents shall be deemed deleted and shall not be binding upon
         either Party. Distributor shall ensure that its Purchase Orders are
         received by the Company at least forty-five (45) days prior to the
         delivery dates requested in the order.

6.2      Acceptance of Orders. All Purchase Orders from Distributor are
         --------------------
         subject to acceptance by the Company. The Company may expressly
         accept or reject each Purchase Order, or the Company may show its
         acceptance by providing to Distributor the appropriate transaction
         documents, including, but not limited to, invoices (showing item,
         quantity, price, amount due, and other typical invoice
         information), and order acknowledgments (confirming Products and
         quantities ordered), or by sending the Products to Distributor. The
         Company will be deemed to have accepted such Order from Distributor
         if it has not objected it within ten (10) days from its submission
         date. Each Purchase Order shall be deemed to be an offer by
         Distributor to purchase the Products pursuant to the terms of this
         Agreement, and, if accepted by the Company shall give rise to a
         contract on the terms set forth herein to the exclusion of any
         additional or contrary terms set forth in the Purchase Order.

         Distributor shall either accept or reject the Products within a
         sixty- (0) day period after the Date of Delivery. Distributor's
         failure to give the Company written notice of rejection within such
         sixty- (0) day period shall be deemed acceptance of the Products by
         Distributor. Distributor shall also be deemed to have accepted the
         Products by signing a transaction document requiring its signature,
         or providing the Products to Resellers, if any, or Users, or making
         any payment, including partial payments, to the Company for such
         Products. Distributor may cancel its Purchase Order in writing
         prior to its acceptance by the Company.

6.3      Delivery, Insurance, Title And Risk Of Loss. The Company will make
         -------------------------------------------
         reasonable efforts to meet Distributor's delivery requirements for
         Products ordered by Distributor in any Purchase Order accepted by
         the Company. The Company will inform Distributor of the estimated
         delivery date and, at Distributor's request, keep it informed of
         its status; provided, however, that in no event shall the Company
         be liable for the consequences of any delays in delivery due.
         Distributor will be responsible for selecting and working with an
         import broker or forwarding agent to handle all shipments to the
         Territory. All delivery of Products to Distributor shall be F.O.B.
         at a mutually agreed port of embarkation (such as dockside at a
         port or airport) in Miami, Florida, U.S.A, and will be made to
         Distributor's broker. Distributor shall be responsible for
         transportation and insurance of the Products




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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
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         after delivery to Distributor's broker. Such insurance shall
         provide full coverage from the time the Products are delivered to
         Distributor's broker until Distributor shall have paid the Company
         for such Products in full. The Company reserves all rights with
         respect to delivered Products permitted by law, including, without
         limitation, the rights of rescission, repossession, resale, and
         stoppage in transit until the full amount due from Distributor in
         respect of all delivered Products has been paid. Distributor shall
         be responsible for obtaining all consents from any government or
         related authority to import the Products into the Territory. Unless
         otherwise provided in this Agreement, "F.O.B." shall be construed
         in accordance with INCOTERMS, 2000 of the International Chamber of
         Commerce.

         The Company bears the risk of loss or of damage to the Products
         until their delivery to Distributor's broker, as provided in the
         preceding paragraph. Thereafter, Distributor assumes such risks.
         Notwithstanding the foregoing, title to each Product will pass to
         Distributor over international waters, en-route to the port of
         importation in the Territory, as such is specified by Distributor
         in the Purchase Order.

6.4      Product Changes. The Company reserves the right, giving Distributor
         ---------------
         a 30 (thirty) day prior written notice, to:
         (a)      Alter the specifications for any Product;
         (b)      Discontinue the manufacture of any Product;
         (c)      Discontinue the development of any new product, whether or
                  not such product has been announced publicly;
         (d)      Commence the manufacture and sale of new products having
                  features which make any Product wholly or partially
                  obsolete. In this case, Company shall provide Distributor
                  with a right of first refusal to distribute such new
                  products under the terms and conditions of this
                  Agreement.; and/or
         (e)      Withdraw any Product from marketing at any time.

         Notwithstanding the above, the Company shall fill all accepted
         Purchase Orders from Distributor for any such altered or
         discontinued Products of which manufacturing and commercial
         deliveries have commenced.

6.5      Reports. Distributor hereby agrees that beginning on the Effective
         -------
         Date of this Agreement, Distributor will deliver to the Company the
         following reports:
         (a)      Monthly reports, covering product type, number of units
                  and US$ amount;
         (b)      Quarterly forecasts of Distributor's projected sales of
                  Products for the immediately subsequent three
                  (3) months, which forecasts will be used for planning
                  purposes only and will not constitute a commitment by
                  either party;
         (c)      Inventory reports;
         (d)      Quarterly financial reports, prepared in accordance with
                  Generally Accepted Accounting Principles (GAAP); and
         (e)      Booking, billing, inventory and customer base information,
                  special reports on Distributor's sales efforts,
                  conditions of the market, and such other matters as the
                  Company may reasonably request by thirty (30) days written
                  notice.
         All financial settlements, reports and billings rendered by
         Distributor for the Company shall, in reasonable detail, accurately
         and fairly reflect the facts about all activities performed by
         Distributor under or with regard to this Agreement.



<PAGE>
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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 11 of 31


                        SECTION 7. QUOTA REQUIREMENTS

7.1      Minimum Quotas. Distributor hereby agrees to attain the marketing
         --------------
         goals agreed upon by Distributor and the Company for purposes of
         this Agreement by ordering and taking delivery from the Company of
         the Quota of Products set forth in EXHIBIT "D" hereto. Distributor
         hereby agrees that the establishment and achievement of such Quota
         is of the essence of this Agreement, and that Distributor's failure
         to meet its Quota shall give the Company the right to end
         Distributor's exclusivity rights to distribute the Products in the
         Territory under this agreement without any responsibility. The
         Distributor can fulfill the specified quota by purchasing products
         in advanced.


                SECTION 8. PRICES, PRICE CHANGES AND PAYMENTS

8.1      Sales Prices. The Company will sell Products to Distributor at such
         ------------
         sale prices as set forth in EXHIBIT "C" - PRICE LIST, attached
         hereto, which may be amended from time to time by the Company
         giving Distributor a 30 (thirty) day prior written notice ("Sales
         Price"), plus any related charges which Distributor must pay to the
         Company in accordance with the provisions of Sections 8.2 and
         Section 8.4, below. The Products' Sales Price shall be specified in
         the respective Purchase Order. All Sales Prices are F.O.B. Miami,
         Florida, U.S.A., unless the Company otherwise agree in a writing
         signed by the Company.

8.2      Related Charges:  The following are related charges
         ---------------
         (a)      Additional Charges:
                  ------------------
                  Depending on the particular Product or circumstances,
                  additional charges may apply, of which the Company will
                  inform Distributor in writing.

8.3      Price Increases and Decreases. The Company may increase the Sales
         -----------------------------
         Price of a Product giving Distributor a 30 (thirty) day prior
         written notice, and without any liability to Distributor. However,
         an increase does not apply to Distributor if the Company receives
         Distributor's signed Purchase Order before the date of effect of
         the Company's written notice to Distributor of such increase.
         Distributor may cancel a Purchase Order for a Product affected by a
         price increase not later than thirty (30) days from the date of the
         Company's notification of such price increase took effect.
         Distributor receives the benefit of a decrease in charges up to and
         including the Date of Shipment of a Product.

8.4      Invoices and Payments. Payment in full of the Sales Price of each
         ---------------------
         Product and the corresponding Related Charges indicated in Sections
         8.1 and 8.2 above shall be due and payable in U.S. dollars to the
         Company not later than on the Date of Delivery. Invoices will be
         submitted upon shipment; provided, that, if any Related Charges and
         other applicable charges are invoiced subsequently to shipment such
         shall be payable in full in U.S. dollars not later than thirty (30)
         days of the date of such invoices.

         All payments shall be made by irrevocable, transferable and
         divisible letter of credit opened at Distributor's expense, issued
         or confirmed by a U.S. bank specified by or acceptable to the
         Company, in accordance with the provisions of Section 8.5 hereof.



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 12 of 31


         The Company may cancel a Purchase Order, without any liability, if
         Distributor does not make full payment in accordance with these
         provisions.

8.5      Letters of Credit. Prior to any shipment, Distributor shall
         -----------------
         establish a letter of credit in favor of the Company, confirmed by
         a U.S. bank acceptable to the Company for an amount equal to the
         Purchase Order. The Company shall be authorized to draw on the
         letter of credit by presentation of one or more sight drafts
         accompanied by specified documents, such as commercial invoice,
         bill of lading or airway bill. Distributor agrees to equitably
         increase the value of the letter of credit if at any time
         throughout the Term of this Agreement, the value of the outstanding
         Purchase Orders is greater than the value of the letter of credit.
         The letter of credit referenced above must also meet the following
         conditions:
         (a)      It must be obtained, and its related costs paid, by
                  Distributor;
         (b)      It must be denominated in U.S. dollars;
         (c)      It must be irrevocable and in a form, and confirmed by a U.S.
                  bank, acceptable to the Company;
         (d)      It must not expire earlier than thirty (30) days after the
                  estimated Date of Shipment;
         (e)      It must provide for partial shipments and partial payments
                  in case of partial shipments; and
         (f)      It must be negotiable by the Company upon submission to the
                  confirming bank of the related commercial invoices and
                  shipping documents.

8.6      Packaging and Shipment. Unless Distributor requests otherwise, all
         ----------------------
         Products ordered by Distributor shall be packed for shipment and
         storage in accordance with the Company's standard commercial
         practices which Distributor represents and warrants to know and
         accept. Any special packaging requirements requested by Distributor
         shall be at Distributor's expense.

                     SECTION 9. LIMITATION TO LIABILITY

9.1      Limitation of Liability and Remedies. Distributor understands and
         ------------------------------------
         agrees that regardless of the basis on which damages can be claimed
         by Distributor, Resellers and/or Users, Distributor's, Resellers'
         and/or Users' exclusive remedy and the Company's exclusive
         liability shall be limited as follows:
         (a)      Actual Damages. The Company is responsible for the amount
                  --------------
                  of any actual loss or damage solely up to the aggregate
                  payments received by the Company for the Product that is
                  the subject of the claim.
         (b)      Consequential Damages. UNDER NO CIRCUMSTANCES, EXCEPT AS
                  ---------------------
                  REQUIRED BY LAW, SHALL THE COMPANY BE LIABLE FOR ANY
                  ECONOMIC CONSEQUENTIAL DAMAGES, INCLUDING (1) ANY SPECIAL,
                  INDIRECT, INCIDENTAL OR CONSEQUENTIAL LOSSES OR DAMAGES
                  (INCLUDING LOST PROFITS OR SAVINGS) TO DISTRIBUTOR AND/OR
                  RESELLERS AND/OR USERS, EVEN IF THE COMPANY SHALL HAVE
                  BEEN ADVISED OF THE POSSIBILITY OF SUCH POTENTIAL LOSS OR
                  DAMAGE, OR (2) THIRD PARTY CLAIMS AGAINST DISTRIBUTOR
                  AND/OR USERS FOR LOSSES OR DAMAGES, OR FOR SPECIAL,
                  INCIDENTAL, OR INDIRECT CHARGES, OR FOR ANY ECONOMIC
                  CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS OR SAVINGS)
                  EVEN IF THE COMPANY SHALL HAVE BEEN ADVISED OF THE
                  POSSIBILITY OF SUCH POTENTIAL LOSS OR DAMAGE.

9.2      Sole Remedies. THE SOLE AND EXCLUSIVE REMEDIES FOR BREACH OF ANY
         -------------
         AND ALL WARRANTIES AND THE SOLE REMEDIES FOR THE COMPANY'S
         LIABILITY IF ANY KIND (INCLUDING LIABILITY FOR NEGLIGENCE) WITH
         RESPECT TO THE PRODUCTS AND SERVICES



<PAGE>
<PAGE>

                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 13 of 31

         COVERED BY THIS AGREEMENT AND ALL OTHER PERFORMANCE BY THE COMPANY
         UNDER OR PURSUANT TO THIS AGREEMENT SHALL BE LIMITED TO THE
         REMEDIES PROVIDED IN SECTION 5 HEREOF.

                   SECTION 10. CHANGES TO AGREEMENT TERMS

10.3     10.1  For any changes to the terms of this Agreement to be valid,
         Distributor and the Company must agree upon such changes in
         writing. Additional or different terms in any Purchase Order or
         other communication from Distributor are void.

                 SECTION 11. GOVERNMENT REGULATION AND TAXES

11.1     Import And Export Documentation. Distributor shall be responsible
         -------------------------------
         for obtaining all licenses and permits and for satisfying all
         formalities as may be required to import Products into the
         Territory, and for clearing the Products through customs, in
         accordance with the laws and regulations in force in the
         Territory, and in accordance with the applicable laws and
         regulations.

11.2     Registration. Distributor shall obtain, at its own expense, all
         ------------
         necessary registrations, licenses, permits, approvals,
         certifications, consents and authorizations or any other permit or
         approval that it may need for the performance of its obligations
         under this Agreement and shall supply all information in this
         respect to the Company.

         Should registration of the Products by the Company be required by
         any governmental body, Distributor shall notify the Company and
         cooperate with the Company in obtaining such registration in the
         Company's name and at the Company's expense. In the event the
         applicable laws of the Territory require registration of the
         Company's Products in the name of Distributor, the Company may
         simultaneously apply for separate registration of the Company's
         Products in its name or the registration shall be made transferable
         to the Company or to any entity designated by the Company, in case
         of termination or expiration of this Agreement and Distributor
         shall prepare, at its own expense, all of the applicable transfer
         documents required by the laws of the Territory for the transfer or
         assignment of the registration. Simultaneously with the execution
         of this Agreement, Distributor shall deliver to the Company
         completed transfer or assignment documents signed by Distributor,
         undated and without designation of a transferee. Distributor hereby
         agrees that it will in no way oppose the transfer or assignment of
         the registration to the name of the Company or to any other party
         which the Company may designate.

11.3     Restrictions To Export. Distributor may actively market, promote
         ----------------------
         and sell Products only within the geographic scope of the
         Territory. Distributor shall not market, nor shall Distributor use
         anyone else to market, any such Products outside the Territory. If,
         unknown to the Company, a Reseller or User acquires Products for
         export, the Company's responsibilities, if any, under this
         Agreement no longer apply to such Products.

11.4     Compliance with the Laws. Both parties agree that, in performing
         ------------------------
         its obligations under this Agreement, they shall comply at all
         times with all applicable laws, regulations and orders. Both
         parties agree to advise



<PAGE>
<PAGE>

                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 14 of 31

         of any change, modification or new law which may affect the
         performance of Distributor or the Company with respect to both
         Parties' obligations hereunder.

         Distributor shall furnish to the Company, from time to time, at the
         Company's request and cost, and at the Company's reasonable
         satisfaction, by affidavit or other reasonable means, affirmative
         assurances that the appointment of Distributor hereunder and its
         activities under this Agreement are proper and lawful under the law
         and regulations in force in the Territory.

11.5     Review Of Distributor's Compliance. The Company may periodically
         ----------------------------------
         review Distributor's compliance with this Agreement. Distributor
         agrees to provide the Company with such relevant records as the
         Company may request, but in this case, the Company agrees and
         understands that this information will be considered as Distributor
         proprietary and confidential information, and therefore it shall be
         treated as confidential by the Company, in terms of this Agreement.
         The Company may reproduce and retain copies of such records. The
         Company, directly or through an independent auditor, may conduct a
         review of Distributor's compliance with this Agreement on
         Distributor's premises during Distributor's business hours. If,
         during the Company's review of Distributor's compliance with this
         Agreement, the Company finds that Distributor has materially
         breached the terms of this relationship, the Company shall be
         entitled to exercise all its rights under law and equity and the
         terms of this Agreement.

11.6     Taxes. Each party will be responsible for paying its own taxes.
         -----
         Both parties agree to comply with all applicable tax laws or
         regulations.

               SECTION 12. TERM AND RENEWAL OF THIS AGREEMENT

12.1     Term. This Agreement shall become effective as of the Effective
         ----
         Date and shall continue in force for a term of 60 (sixty) months
                                                        --  -----
         from the Effective Date (the "Term").

         Any rights and licenses granted to Distributor hereunder shall
         extend for the Term of this Agreement, and any renewals thereof,
         and shall automatically terminate upon termination or expiration of
         this Agreement or any renewals thereof.

12.2     Renewal. Upon written request from Distributor, which must be
         -------
         delivered to the Company at least thirty (30) days prior to the
         expiration of the Term, the Company, in its own discretion, may
         negotiate in good faith with Distributor for a renewal of the
         Agreement on such terms as the Parties may mutually agree, provided
         that, on the date of request, Distributor (i) is not in default of
         any material term or condition of this Agreement or any other
         agreements between the Company and Distributor, (ii) has met the
         Quota requirements set forth herein; and (iii) has satisfied all
         monetary obligations owed by Distributor to the Company.



<PAGE>
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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 15 of 31


                         SECTION 13. CONFIDENTIALITY

13.1     Confidential Information. Distributor agrees that the Company has a
         ------------------------
         proprietary interest in any and all Company Confidential
         Information provided to Distributor by the Company in connection
         with this Agreement or otherwise, whether such information is in
         written, oral or visual form.

13.2     Protection Of Company Information. Distributor acknowledges and
         ---------------------------------
         agrees that all Company Confidential Information is confidential
         and proprietary to the Company. In this regard,
         (a)      Distributor agrees to use Company Confidential Information
                  solely in the discharging of its responsibilities hereunder;
         (b)      Distributor may disclose Company Confidential Information
                  to its employees or external consultants (including
                  attorneys and accountants) who have the need to know such
                  information; provided, however, that prior to any such
                  disclosure, Distributor must have an appropriate
                  confidentiality agreement with any such employee or
                  consultant, binding such employee or consultant on the
                  terms of this Section 13. For a period of three (3) years
                  from the date of receipt of Company Confidential
                  Information, Distributor may not disclose such
                  Confidential Information to others (including but not
                  limited to any affiliates of Distributor) unless, prior to
                  such disclosure, Distributor has an appropriate agreement
                  with the other party and such disclosure is approved by
                  the Company in writing. All such appropriate agreements
                  must enable Distributor to meet its obligations hereunder
                  and to enforce the terms and conditions of this Section;
         (c)      Distributor shall not make any additional copies of any
                  writings, documents, programs or other media which contain
                  Company Confidential Information and are marked "do not
                  reproduce" or similar language, without the prior written
                  permission of the Company;
         (d)      Distributor shall keep all writings, documents or other
                  media containing Company Confidential Information secure
                  in locked files at all times, when not in use, to prevent
                  their loss or unauthorized disclosure, take action to
                  prevent unauthorized access to any of its premises and
                  comply with all other reasonable security procedures and
                  measures which the Company may recommend from time to
                  time;
         (e)      Distributor shall segregate Company Confidential
                  Information at all times from materials of third parties;
         (f)      Distributor's obligations with respect to Company
                  Confidential Information will not apply to any information
                  that (i) is already in its possession without obligation
                  of confidence; (ii) is independently developed; (iii) is
                  or becomes publicly available without breach of this
                  Agreement; (iv) Distributor rightfully receives from a
                  third party without obligation of confidence; or (v) is
                  released for disclosure with the Company's written
                  consent;
         (g)      Distributor shall, upon termination or expiration of this
                  Agreement, deliver to the Company all written or
                  descriptive materials which contain Company Confidential
                  Information;
         (h)      From time to time, the Company may provide Distributor
                  with copies of documents labeled "For Internal Use Only".
                  Distributor agrees to limit use of these documents to the
                  performance of its responsibilities hereunder and not to
                  make the documents available to any third party.



<PAGE>
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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 16 of 31


13.3     Protection Of Distributor Information
         -------------------------------------
         (a)      Distributor understands that the Company does not wish to
                  receive any information which Distributor, or any third
                  party, considers confidential or proprietary. Information
                  that Distributor supplies to the Company will not be
                  treated as confidential by the Company unless, before
                  receipt, the Company agrees in writing to do so.
         (b)      The Company may use any information which Distributor
                  makes available to the Company, designated as confidential
                  by Distributor, and the Company may authorize its
                  affiliates to use such information in their operations;
                  provided, however, that the Company shall instruct its
                  personnel to keep such information confidential by using
                  the same care and discretion that it uses with similar
                  data which the Company designates as confidential;
                  further, the Company shall not disclose any such
                  confidential information by publication or otherwise to
                  any third party without the prior written permission of
                  Distributor.
         (c)      Notwithstanding the foregoing, if the Company conducts an
                  inspection in accordance with its rights pursuant hereto,
                  any materials inspected will be treated as confidential
                  and the Company will not disclose any of them unless
                  required by law to do so.

                  SECTION 14. INTELLECTUAL PROPERTY MATTERS

14.1     Trademarks. Distributor is hereby authorized to use, royalty free,
         ----------
         the Trademarks within the Territory solely for the Term of this
         Agreement and solely for purposes of identifying the Products which
         Distributor is authorized to market hereunder. In addition,
         Distributor is hereby authorized to use, during the Term of this
         Agreement and within the Territory, the designation "Distributor of
         VeriChip Products", in its activities hereunder.
         (a)      Distributor is not granted any right or license to use the
                  Trademarks or any other trademark or tradename owned by
                  the Company in such a manner as to cause confusion
                  concerning the origin of any goods or services.
                  Promotional, advertising and other materials to be used by
                  Distributor, which incorporate or display any Trademarks,
                  other than such material which has been supplied to
                  Distributor by the Company, shall be subject to the
                  Company's guidelines or instructions. Distributor agrees
                  to change or correct, at Distributor's expense, any such
                  promotional advertising or other material, which in the
                  Company's reasonable judgment is inaccurate, objectionable
                  or misleading, or misuses a trademark or tradename owned
                  by the Company.
         (b)      Distributor hereby acknowledges the Company's exclusive
                  right, title and interest in and to the Trademarks.
                  Distributor acknowledges and agrees that, except for the
                  limited use of the Trademarks for purposes of marketing
                  and distributing the Products in conformity with this
                  Agreement, Distributor will acquire no right, title or
                  interest of any kind or nature whatsoever in or to the
                  Trademarks or the goodwill associated therewith.
                  Distributor recognizes that the Trademarks and any
                  goodwill attached thereto, belong to the Company, and
                  Distributor understands and agrees that Distributor's use
                  of the Trademarks shall inure to the benefit of the
                  Company. Distributor shall not disparage, bring into
                  disrepute or reduce the value of any Trademarks.
                  Distributor shall not at any time do or permit any act to
                  be done which may in any way impair the rights of the
                  Company in the Trademarks.
         (c)      Distributor shall not, without the Company's prior written
                  consent, remove or alter any Trademarks, trade names,
                  patent numbers, serial numbers, notices, labels, tags or
                  other identifying marks, symbols or legends affixed to any
                  Products, containers or packages.



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 17 of 31

         (d)      Distributor undertakes fully and without any reservation
                  whatsoever to render to the Company all assistance as may
                  be necessary in connection with any matter pertaining to
                  the protection of the Trademarks, including, without
                  limitation, to assert no interest in or to, and to
                  withdraw or terminate any interest in or to, any
                  Trademarks which would limit the Company's ability to
                  protect those Trademarks.
         (e)      Distributor shall inform the Company of all registration
                  and recording requirements with respect to the Trademarks
                  within any country of the Territory. All registrations of
                  any Trademarks and domain names which Distributor may
                  assist the Company to obtain within the Territory will be
                  in the name of the Company. Distributor shall not
                  undertake any activities to attempt to register any of the
                  Company's Trademarks without the Company's prior written
                  consent. Distributor shall not use, employ or attempt to
                  register any trademark or tradename which, in the sole
                  judgment of the Company, is confusingly similar to any of
                  the Trademarks.
         (f)      Distributor will immediately notify the Company in writing
                  if any claim of infringement is brought against
                  Distributor in respect to the use of the Trademarks, or if
                  Distributor is aware of or suspects any infringement of
                  the Trademarks by another party. The Company reserves the
                  right in its sole discretion to institute any proceedings
                  against any such third party infringers and Distributor
                  shall refrain from doing so. The Company shall control the
                  defense or prosecution of any actions concerning
                  infringement of its Trademarks. Distributor shall
                  cooperate fully with the Company in any action taken by
                  the Company against any such third parties, provided that
                  all expenses of such action, including Distributor's,
                  shall be borne by the Company and all damages which may be
                  awarded therefrom shall accrue to the Company.
         (g)      Upon termination or expiration of this Agreement,
                  Distributor shall forthwith cease and desist from use of
                  the Trademarks in any manner. In addition, Distributor
                  hereby empowers the Company and agrees to reasonably
                  assist the Company, if requested, to cancel, revoke or
                  withdraw any governmental registration or authorization
                  permitting Distributor to use the Trademarks in the
                  Territory.
         Any unauthorized use of the Trademarks by Distributor shall be a
         material breach of this Agreement, entitling the Company to
         terminate this Agreement in accordance with Section 16 hereof and
         to bring an action for infringement of the rights of the Company in
         and to the Trademarks.

14.2     Patents And Copyrights. No rights or licenses are granted to
         ----------------------
         Distributor herein by the Company, expressly or by implication,
         under any patents or copyrights.
         (a)      The Company shall defend Distributor against any claim
                  that any Product provided by the Company hereunder
                  infringe any patent, copyright or other analogous right
                  enforceable in the Territory, and the Company shall pay
                  any resulting damages, costs and attorney's fees finally
                  awarded by a court or any resulting settlement agreed upon
                  by the Company, provided that Distributor promptly
                  notifies the Company in writing of the claim and, further
                  provided, that the Company has sole control of the defense
                  and of all related settlement negotiations.
         (b)      The Company's obligation under this Section is subject to
                  the condition that if any Product becomes, or in the
                  Company's opinion is likely to become, the subject of such
                  a claim, Distributor shall permit the Company, at its
                  option and expense, either to procure the right of
                  Distributor to continue marketing or using the item
                  involved or to replace or modify it so that it becomes
                  non-infringing. If neither of the foregoing alternatives
                  is available in terms which are reasonable in the
                  Company's sole judgment, Distributor hereby agrees that,
                  upon written request by the Company, Distributor shall
                  return the item involved to the Company. In such a



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 18 of 31

                  case, the Company agrees to grant a credit or refund to
                  Distributor for the amount of charges of the returned
                  Product, as well as any costs of return and applicable
                  taxes thereon.
         (c)      The Company shall have no obligation to Distributor for
                  any liability to third parties for any claim based upon
                  any alteration or modification of any Product or based
                  upon the combination, operation or use of any Product with
                  equipment, data or programming not supplied by the
                  Company.

     The foregoing states the entire obligation of the Company in regard of
     all intellectual property matters and Distributor shall have no right
     to act in the Company's name or on the Company's behalf, with respect
     to infringement of patents, copyrights or analogous rights relating to
     the Products.

                         SECTION 15. INDEMNIFICATION

15.1     Distributor Indemnification. In addition to damages for which
         ---------------------------
         Distributor may be liable under law or equity or under the terms of
         this Agreement or any other applicable agreements, and subject to
         the provisions of Section 15.4 - "Indemnification Procedure",
         below, Distributor shall indemnify, defend and hold the Company,
         its affiliates and all officers, directors, employees and agents
         thereof, harmless from and against any and all claims, liabilities,
         losses, damages, costs and expenses (including without limitation
         reasonable attorney's fees, expenses and settlement costs,
         including appeal proceedings) (collectively, "Damages"), which the
         Company or any of its Affiliates and all officers, directors,
         employees and agents thereof may at any time sustain or incur by
         reason of or in connection with any claim, demand or other action
         initiated by any person or entity, arising from, related to or in
         any way connected with (i) Distributor's conduct under this
         Agreement and any other applicable agreements; (ii) Distributor's
         breach of this Agreement; (iii) Distributor's failure to comply
         with applicable laws and regulations; or (iv) Distributor's
         relations with anyone else, particularly regarding statements,
         representations or warranties made by Distributor not expressly
         authorized in writing by the Company hereunder. Furthermore,
         Distributor shall indemnify and hold the Company harmless from and
         against any and all claims, costs, damages and liabilities
         whatsoever asserted by any employee, agent, or representative of
         Distributor under any applicable termination, labor, social
         security or other similar laws and regulations.

         Distributor shall not be obliged to indemnify the Company from any
         such liability, loss, damage, cost or expense, to the extent that
         such liability, loss, damage, cost or expense was caused directly
         or indirectly by any act or omission or misrepresentation, or by
         breach of obligations specified in this Agreement by the Company.

15.2     Company Indemnification. The Company hereby agrees to indemnify,
         -----------------------
         defend and hold harmless Distributor, its affiliates and all
         officers, directors, employees and agents thereof from all Damages
         arising out of: (i) the Company's material breach of this
         Agreement, or (ii) the Company's failure to comply with applicable
         laws and regulations in the U.S..

         The Company's liability hereunder will be limited as follows:
         (a)      Claims, Demands and Other Actions:
                  ---------------------------------
                  With respect to the claims, demands and other actions
                  referred to in Paragraph 15.1, above, to the extent that
                  any such claim, demand or other action relates to:
                  (1)      any Product sold by Distributor pursuant to any
                           agreement containing warranties or other commitments
                           which exceed those warranties or commitments which
                           the



<PAGE>
<PAGE>

                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 19 of 31

                           Company extends hereunder, the Company's
                           obligation to indemnify Distributor shall be
                           equal to the liabilities, losses, damages, costs
                           and expenses for which Distributor would have
                           been liable if the agreement pursuant to which
                           Distributor sold the Product involved had not
                           contained such additional warranties or other
                           commitments;
                  (2)      the failure by Distributor to deliver a Product
                           by a delivery date committed by the Company, the
                           Company's obligation to indemnify Distributor, if
                           any, shall not exceed the liabilities, losses,
                           damages, costs and expenses for which Distributor
                           would have been liable if the agreement pursuant
                           to which Distributor sold the Product involved
                           had contained provisions substantially identical
                           to those of Section 17.13. "Force Majeure",
                           hereof.
         (b)      Certain Distributor Actions:
                  ---------------------------
                  In any event, the Company shall not be obliged to
                  indemnify Distributor from any such liability, loss,
                  damage, cost or expense to the extent that such liability,
                  loss, damage, cost or expense was caused by any
                  intentional or grossly negligent act or omission or
                  misrepresentation, or by any breach of obligations
                  specified in this Agreement by Distributor.

15.3     Allocation of Expenses
         ----------------------
         In the event a claim is based partially on an indemnified claim
         described in Section 15.1 and/or Section 15.2, above, and partially
         on a non-indemnified claim, or is based partially on a claim
         described in Section 15.1, above, and partially on a claim
         described in Section 15.2, above, any payments and reasonable
         attorney fees incurred in connection with such claims are to be
         apportioned between the Parties in accordance with the degree of
         cause attributable to each Party.

15.4     Indemnification Procedure
         -------------------------
         The liability of Distributor and of the Company under Section 15.1
         and Section 15.2, is subject to Distributor or the Company (as the
         case may be): (a) having promptly notified the other of any claim,
         demand or other action likely to give rise to a claim against the
         other; and (b) giving the other all freedom either to join the
         defense, or to direct such defense, with a right to come to a
         settlement if the other so wishes.

                    SECTION 16. TERMINATION OF AGREEMENT

         Distributor or the Company may terminate this Agreement, prior to
         expiration, with or without cause pursuant to the terms of this
         Section 16. "Cause" for purposes of this Section is the breach by
         any of the Parties of a material term of this Agreement.

16.1     Termination (curable). If the Company or Distributor materially
         ---------------------
         breaches this Agreement and if such breach remains uncured for
         thirty (30) days after written notice of such breach, the innocent
         party may terminate this Agreement for Cause by delivery of written
         notice of termination, effective thirty (30) days after the date of
         such notice. The breaching party may avoid termination by curing
         its breach to the non-breaching party satisfaction within the
         thirty- (30) day cure period.

         Distributor's material breach of this Agreement which the Company
         may find susceptible of cure include the following: If Distributor
         (1) fails to substantially comply with any of the terms and
         conditions of this Agreement, other related agreements and forms
         attached hereto and thereto; (2) fails, refuses or neglects to
         obtain the Company's prior written approval or consent as required
         in this Agreement; (3)



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 20 of 31

         fails, refuses, or neglects to promptly pay when due any amounts
         Distributor may owe to the Company hereunder; (4) fails to submit
         when due any reports, financial information, or any other
         information or documents required under this Agreement; (5) fails
         to observe or maintain any of the standards or procedures the
         Company prescribes herein or otherwise in writing; or (6) in the
         Company's sole discretion, Distributor engages or has engaged in
         any illegal, fraudulent, unfair or deceptive business practices.

16.2     Termination by the Company. The Company may terminate this
         --------------------------
         Agreement for Cause if Distributor materially breaches this
         Agreement, by delivering to Distributor written notice of
         termination, which shall become effective as follows:

         (a)      Upon Written Notice of Termination. If Distributor
                  ----------------------------------
                  materially breaches this Agreement, and the Company, deems
                  that Distributor's material breach is incurable, the
                  Company may terminate this Agreement without affording
                  Distributor any opportunity to cure, by delivering to
                  Distributor the Company's written notice of termination
                  which shall become effective immediately upon delivery, or
                  as required by applicable law.

                  Distributor's incurable material breach of this Agreement
                  include the following: (1) If Distributor has falsely made
                  any of the representations and warranties set forth in
                  this Agreement, or knowingly maintains false books or
                  records or submits any false reports to the Company; or
                  (2) Distributor (and/or its principals) are convicted of a
                  felony, a fraud, a crime involving moral turpitude, or
                  found liable in a civil claim for fraud or any unfair or
                  deceptive act or practice; or (3) Distributor (and/or its
                  owners) purports to transfer any rights or obligations
                  under this Agreement or any interest in Distributor to a
                  third party, without the Company's prior written consent,
                  or (4) Distributor discloses or divulges, directly or
                  indirectly, any information the Company may provide to
                  Distributor as Company Confidential Information; or (5)
                  Distributor forfeits its legal right to do or to transact
                  business in the Territory; or (6) Distributor breaches any
                  terms hereof providing for immediate termination of this
                  Agreement; or (7) Distributor repudiates this Agreement.
          (b)     Automatic Termination. Subject to applicable law, this
                  ---------------------
                  Agreement and each and all rights granted to Distributor
                  hereunder shall immediately and automatically terminate
                  upon the occurrence of Distributor's insolvency,
                  bankruptcy, moratorium, dissolution, liquidation or
                  reorganization, or upon the occurrence of any other events
                  that in the Company's sole discretion may substantially
                  affect Distributor's ability to carry out its obligations
                  under this Agreement.

16.3     Upon termination or expiration of the term of this Agreement or any
         renewal thereof, neither Party shall have any further rights or
         obligations hereunder; provided, that, expiration or termination of
         this Agreement shall not relieve Distributor or the Company of
         their respective obligations incurred prior thereto and that any
         obligations, which by their nature extend beyond expiration or
         termination of a contract, such as those concerning intellectual
         property rights, indemnification and limitation of liabilities
         shall survive expiration or termination of this Agreement and
         remain in effect until fulfilled, and shall apply to the Parties'
         respective successors and assignees. Distributor hereby agrees that
         if the Company permits Distributor to perform certain activities
         after this Agreement expires or terminates, Distributor will do so
         under the terms of this Agreement.

16.4     Distributor and the Company agree that neither Distributor nor the
         Company will be liable for any claims or losses the other may incur
         by early termination of this Agreement in accordance with the



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 21 of 31


         provisions of this Section. Distributor hereby agrees that, in the
         event of termination or upon expiration of this Agreement, the
         Company shall have no obligation whatsoever to Distributor, or to
         any employee of Distributor, for compensation or for damages of any
         kind, whether on account of the loss by Distributor or such
         employee of present or prospective sales, investments, compensation
         or goodwill or otherwise.

16.5     Distributor hereby agrees that no right or remedy conferred upon or
         reserved to the Company under this Agreement is exclusive of any
         other right or remedy provided or permitted by law or equity.

                    SECTION 17. MISCELLANEOUS PROVISIONS

17.1     Prior Agreements. This Agreement contains the entire agreement of
         ----------------
         the Parties with respect to the subject matter hereof and shall
         cancel and supersede, as of the date this Agreement is signed by
         both Parties, any prior agreements written or oral between the
         Parties or their respective legal predecessors with respect to the
         subject matter covered by this Agreement.

17.2     Geographic Scope. All of Distributor's rights under this Agreement
         ----------------
         are valid only in the Territory.

17.3     Governing Law. This Agreement shall be governed by and construed in
         -------------
         accordance with the internal laws of the State of Florida, United
         States of America, applicable to agreements made and to be
         performed entirely within Florida, without regard to the conflicts
         of law principles of such State. Distributor acknowledges,
         represents and warrants that it is aware of the laws of the State
         of Florida, and has been duly advised and willfully chooses the
         laws of the State of Florida as the governing law for this
         Agreement.

         The Parties hereby agree that neither the "United Nations
         Convention on Contracts for the International Sale of Goods", nor
         the Convention on the Limitation Period in the International Sale
         of Goods and the Protocol amending such Convention, done at Vienna
         April 11, 1980, shall govern the rights, duties and obligations of
         the Parties under this Agreement.

17.4     Jurisdiction; Consent to Service of Process
         -------------------------------------------

         (a)      If any dispute arises between the parties regarding any
                  matter under this Agreement, the parties will refer the
                  dispute to senior executives of each party, who will
                  attempt to resolve the dispute within ten (10) business
                  days of the referral date. If the executives resolve the
                  dispute, they will state the resolution in a writing
                  provided to both parties. If the executives determine that
                  they are unable to resolve the dispute (the date of such
                  determination, the "Impasse Date"), the parties will seek
                  to resolve the dispute through non-binding mediation
                  conducted at a mutually agreeable location; if the parties
                  are not able to agree on a mediator within ten (10)
                  business days after the Impasse Date, the mediation will
                  be conducted under the American Arbitration Association's
                  ("AAA's") then-current mediation rules by a mediator
                  selected at random from the AAA panel of mediators with
                  property expertise. The mediation must be conducted within
                  thirty (30) days after the Impasse Date, with each party
                  to bear its own costs and to share equally in the cost of
                  the mediation itself (including mediator's fees).



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 22 of 31


                  No court action for damages may be commenced unless the
                  parties have completed mediation without resolving the
                  dispute.
         (b)      Both of the Parties hereby irrevocably and unconditionally
                  submit, for themselves and their property, to the
                  jurisdiction of any court of the State of Florida sitting
                  in Palm Beach County, Florida, or any Federal court of the
                  United States of America sitting in the Southern District
                  of the State of Florida, and any appellate court from any
                  such court, in any suit, action or proceeding arising out
                  of or relating to this Agreement, or for recognition or
                  enforcement of any judgment, and each of the Parties
                  hereto hereby irrevocably and unconditionally agrees that
                  all claims in respect of any such suit, action or
                  proceeding may be heard and determined in such State of
                  Florida court or Federal court. It shall be a condition
                  precedent to each Party's right to bring any such suit,
                  action or proceeding that such suit, action or proceeding,
                  in the first instance, be brought in such State of Florida
                  court or, to the extent permitted by law, in such Federal
                  court (unless such suit, action or proceeding is brought
                  solely to obtain discovery or to enforce a judgment), and
                  if each of such State of Florida court and such Federal
                  court refuses to accept jurisdiction with respect thereto,
                  such suit, action or proceeding may be brought in any
                  other court of competent jurisdiction. No Party to this
                  Agreement may move to (1) transfer any such suit, action
                  or proceeding from such State of Florida court or any
                  Federal court of the United States of America sitting in
                  the State of Florida, to another jurisdiction, (2)
                  consolidate any such suit, action or proceeding brought in
                  such State of Florida court or Federal court with a suit,
                  action or proceeding in another jurisdiction, or (3)
                  dismiss any such suit or proceeding brought in such State
                  of Florida court or any Federal court of the United States
                  of America sitting in the State of Florida, for the
                  purpose of bringing the same in another jurisdiction. Each
                  Party agrees that a final judgment in any such suit,
                  action or proceeding shall be conclusive and may be
                  enforced in any other jurisdiction by suit on the judgment
                  or in any other manner provided by law.
         (c)      Each of the Parties hereby irrevocably and unconditionally
                  waives, to the fullest extent it may legally and
                  effectively do so, any objection which it may now or
                  hereafter have to the laying of venue of any suit, action
                  or proceeding arising out of or relating to this Agreement
                  in any State of Florida court sitting in Palm Beach
                  County, Florida, or any Federal court sitting in the
                  District of the State of Florida. Each of the Parties
                  --------
                  hereby irrevocably waives, to the fullest extent permitted
                  by law, the defense of an inconvenient forum to the
                  maintenance of such suit, action or proceeding in such
                  court and further waives the right to object, with respect
                  to such suit, action or proceeding, that such court does
                  not have jurisdiction over such Party.
         (d)      Each of the Parties, hereby irrevocably consents to
                  service of process in the manner provided for notices in
                  Section 17.6 hereof. Nothing in this Agreement will affect
                  the right of either Party to this Agreement to serve
                  process in any other manner permitted by law.

17.5     Assignment. This Agreement and the rights and obligations hereunder
         ----------
         may not be assigned, delegated or transferred by either Party
         without the prior written consent of the other Party; provided,
         however, that Distributor's consent shall not be required with
         respect to any assignment, delegation or transfer by the Company to
         any entity providing financing to the Company, to another division
         of the Company or to any affiliate of the Company or division of
         such affiliate. This Agreement shall inure to the benefit of the
         permitted successors and assigns of the Company. For the purposes
         of this Agreement, "affiliate" shall mean any company, natural
         person, partnership or other business entity controlled by, under
         common control with or controlling either Party to this Agreement.



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

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17.6     Notices. Notices and other communications provided for herein shall
         -------
         be in writing and shall be delivered by hand or overnight
         international courier service, sent by graphic scanning or other
         telegraphic communication equipment available to both, the sending
         Party and the receiving Party, as follows:

If to Distributor:

Attention:

                  RussGps, Ltd.
                  Central Telegraph Building
                  Tverskaya Str., 7,
                  Moscow Russia 103009
                   +7 (095) 777-26-00
                  Attention: President
If to the Company:
                  VeriChip Corporation
                  400 Royal Palm Way, Ste. 410
                  Palm Beach, FL  33480
                  United States of America
                  Facsimile No.:  (561) 805-8001
                  Attention:  President

         All notices and other communications given to either Party hereto
         in accordance with the provisions of this Agreement shall be deemed
         to have been given on the date of delivery if delivered by hand or
         overnight courier service or on the first business day if sent by
         telex, graphic scanning or other telegraphic communications
         equipment available to both the sender and the receiver, or on the
         date five (5) business days after dispatch by certified or
         registered mail if mailed, in each case delivered, sent or mailed
         (properly addressed) to such Party as provided in this Section
         17.6, or in accordance with the latest unrevised direction from
         such Party given in accordance with this Section.

17.7     Amendments. Except as provided elsewhere herein, this Agreement can
         ----------
         be modified only by a specific written agreement duly signed by
         persons authorized to sign agreements on behalf of Distributor and
         the Company.

17.8     Publicity. Distributor agrees that any publicity or advertising
         ---------
         which shall be released by Distributor in which the Company is
         identified in connection with the Products shall be in accordance
         with the terms of this Agreement and with such information or data
         as the Company may, from time to time, furnish to Distributor for
         such purposes. Copies of all such publicity and advertising shall
         be forwarded to the Company for its prior written approval.

17.9     Severability. If any provision of this Agreement shall be held by a
         ------------
         court or other tribunal of competent jurisdiction to be invalid,
         illegal or unenforceable, or shall be required to be modified, the
         validity, legality and enforceability of the remaining provisions
         shall not be affected or impaired thereby.



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

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17.10    Counterparts. This Agreement may be executed in any number of
         ------------
         counterparts, each of which will be deemed an original but all of
         which when taken together will constitute one and the same
         contract, and shall become effective when one or more such
         counterparts have been signed by each of the Parties and delivered
         to the other Party.

17.11    Waiver. The waiver by either Party of any instance of the other
         ------
         Party's non-compliance with any obligation or responsibility herein
         shall not be deemed a waiver of the waiving Party's remedies for
         such non-compliance in the future.

17.12    Time Limit On Actions. No action, regardless of form, arising out
         ---------------------
         of this Agreement may be brought by either Party more than two (2)
         years after the cause of action has occurred; provided, however,
         that this paragraph shall not apply to actions involving patents,
         copyrights, Trademarks or tradenames, Company Confidential
         Information, or actions to compel Distributor, after termination or
         expiration of this Agreement, to cease representing itself as a
         distributor of the Company.

17.13    Force Majeure. Neither Party shall be liable for failure to perform
         -------------
         or delay in performing any obligation under this Agreement, except
         the obligation to make payments when due, if such failure or delay
         is due to force majeure, including, but not limited to, war,
         embargo, riot, insurrection, sabotage or other civil unrest; fire,
         explosion, flood or other natural disaster; accident or breakdown
         of machinery; unavailability of fuel, labor, containers, or
         transportation facilities; accidents of navigation, breakdown or
         damage of vessels or other conveyances for air, land or sea; other
         impediments or hindrances to transportation; strike or other labor
         disturbances; government restraints or any other cause beyond the
         control of the affected party; provided, however, that the Party so
         failing to perform shall (i) as soon as possible, inform the other
         Party of the occurrence of the circumstances preventing or delaying
         the performance of its obligations, and describe at a reasonable
         level of detail the circumstances causing such delay, and (ii)
         exert reasonable efforts to eliminate, cure or overcome any of such
         cases and to resume performance of its covenants with all possible
         speed. In such event, the non-performing Party will be excused from
         any further performance or observance of the obligation(s) so
         affected for as long as such circumstances prevail and such Party
         continues to use its best efforts to recommence performance or
         observance whenever and to whatever extent possible without delay.
         In the event that, by operation of law or governmental decree, it
         becomes illegal to market and sell a Product in the Territory,
         Distributor shall be relieved of its obligations under this
         Agreement (other than the obligation to make any payment due
         hereunder) only to the extent that they relate to such Product. Any
         Party so delayed in its performance will be under no liability for
         loss or damages suffered by the other Party thereby.

         Either Party may convene a meeting between the Parties to discuss
         the force majeure and its effect on any obligation under this
         Agreement. The Parties shall seek to modify the relevant provisions
         in order to accommodate the circumstances caused by the force
         majeure. If the Parties fail to agree on such modifications within
         thirty (30) calendar days after notice of the force majeure is
         delivered, either Party may terminate this Agreement by written
         notice to the other Party. Such termination shall be effective
         thirty (30) calendar days after the date of the written notice.



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

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17.14    WAIVER OF JURY TRIAL
         --------------------

         EACH PARTY HERETO HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
         WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
         RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
         DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH
         THIS AGREEMENT, OR ANY DOCUMENT CONTEMPLATED TO BE EXECUTED OR
         DELIVERED IN CONJUNCTION HEREWITH. EACH PARTY HERETO (1), CERTIFIES
         THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS
         REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE OTHER PARTY WOULD
         NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
         WAIVER AND (2), ACKNOWLEDGES THAT IT AND THE OTHER PARTY HERETO
         HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
         THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

17.15    Section Headings. The section headings contained herein are
         ----------------
         for convenience of reference only and shall not be used in
         construing this Agreement.

                         SECTION 18. SPECIFIC TERMS

18.1     Specific Terms Applicable To Distributor:
         ----------------------------------------

         Distribution Agreement Number: 011
                                        ---
         Territory: The countries of Ex-Soviet Union and Switzerland
         (Countries of Independent States)

         Agreement Effective Date: JUNE 30, 2003, UPON RECEIPT OF DISTRIBUTION
                                   -------------------------------------------
         FEE OF US $50,000.00
         --------------------

         Duration: 60 (sixty) months from Effective Date
                   -------------------------------------
         Products: See EXHIBIT "B", hereto.
                   -----------------------

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
signed by their duly authorized representatives on the date written below.

WITNESSES:                     DISTRIBUTOR:

                                 /S/ Pavel Panov
                               ---------------------------
                               By: Pavel Panov
                                   -----------
Name:                          Title: President
                                      ---------
Date: May 30, 2003             Date: May 30, 2003
      ------------                   ------------




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                                        ------------------------------------

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WITNESSES:

Name:
Date:

                                          ACCEPTED BY THE COMPANY,
WITNESSES:                                VERICHIP CORPORATION, a
                                          Delaware Corporation, on
                                          the date shown below:


Name: Mike Feder
Date:
WITNESSES:                                      /S/ Keith Bolton
                                              ---------------------------
                                          By: Dr. Keith Bolton
                                              ---------------------------
                                          Title: President
                                                 ------------------------
                                          Date: May 30, 2003
                                                -------------------------


Name: Terry Gallager
Date:



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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 27 of 31


                                 EXHIBIT "A"

                     FORM OF PURCHASE ORDER FOR PRODUCTS
                          (Check the Current Form)

                                    Check




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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

                                                               Page 28 of 31



                                 EXHIBIT "B"

                                  PRODUCTS

VERICHIP IMPLANTABLE MICROCHIP AND PLD

AGREED TO AND ACCEPTED ON THIS 26TH DAY OF AUGUST, 2003 (UPON RECEIPT OF
DISTRIBUTION FEE), BY:

DISTRIBUTOR:                                 VERICHIP CORPORATION, a
______________________________., a           Delaware Corporation,
company organized and existing               on the date shown below:
under the laws of Florida:

  /S/ Pavel Panov                            /S/ Keith Bolton
-----------------------------------          ----------------------------------
By: Pavel Panov                              By: Dr. Keith Bolton
    -------------------------------              ------------------------------
Title: President                             Title: President
       ----------------------------                 ---------------------------
Date: May 30, 2003                           Date: May 30, 2003
      -----------------------------                ----------------------------




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                                        INTERNATIONAL DISTRIBUTION AGREEMENT
                                        ------------------------------------

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                                 EXHIBIT "C"

                                 PRICE LIST

Microchips: $75 per unit
Scanners:  $650 per unit

AGREED TO AND ACCEPTED ON THIS 26TH DAY OF AUGUST, 2003 (UPON RECEIPT OF
DISTRIBUTION FEE), BY:

DISTRIBUTOR:                                 VERICHIP CORPORATION, a
______________________________., a           Delaware Corporation,
company organized and existing               on the date shown below:
under the laws of Florida:

  /S/ Pavel Panov                            /S/ Keith Bolton
-----------------------------------          ----------------------------------
By: Pavel Panov                              By: Dr. Keith Bolton
    -------------------------------              ------------------------------
Title: President                             Title: President
       ----------------------------                 ---------------------------
Date: May 30, 2003                           Date: May 30, 2003
      -----------------------------                ----------------------------





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                                 EXHIBIT "D"

                             QUOTA REQUIREMENTS

During the Term of this Agreement, Distributor shall make the following
minimum purchases of Products:

EXCLUSIVE DISTRIBUTOR LICENSE: $50,000 cost for Exclusive Distribution License

MINIMUM PURCHASE ORDER YEAR 2003:
         Microchips: 1,000 units at $90 per unit.
         Scanners: 100 units at $650 per unit

PURCHASE ORDER YEAR 2004:
         Microchips: 5,000 units at $90 per unit
         Scanners: 250 at $650 per unit

PURCHASE ORDER YEAR 2005:
         Microchips: 10,000 units at $90 per unit
         Scanners: 500 at $650 per unit

PURCHASE ORDER YEAR 2006:
         Microchips: 15,000 units at $90 per unit
         Scanners: 1,000 at $650 per unit

PURCHASE ORDER YEAR 2007:
         Microchips: 20,000 units at $90 per unit
         Scanners: 1,000 at $650 per unit

AGREED TO AND ACCEPTED ON THIS 30TH DAY OF MAY, 2003, EFFECTIVE DATE
JUNE 30, 2003 (UPON RECEIPT OF DISTRIBUTION FEE), BY:

DISTRIBUTOR:                                 VERICHIP CORPORATION, a
RussGPS, Ltd., a Russian company             Delaware Corporation,
organized and existing under                 on the date shown below:
the laws of Russia:

  /S/ Pavel Panov                            /S/ Keith Bolton
-----------------------------------          ----------------------------------
By: Pavel Panov                              By: Dr. Keith Bolton
    -------------------------------              ------------------------------
Title: President                             Title: President
       ----------------------------                 ---------------------------
Date: May 30, 2003                           Date: May 30, 2003
      -----------------------------                ----------------------------





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                                        ------------------------------------

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                                 EXHIBIT "E"

                                  TERRITORY

THE COUNTRIES OF EX-SOVIET UNION AND SWITZERLAND (COUNTRIES OF INDEPENDENT
STATES)

AGREED TO AND ACCEPTED ON THIS 30TH DAY OF MAY, 2003, EFFECTIVE DATE
JUNE 30, 2003 (UPON RECEIPT OF DISTRIBUTION FEE), BY:

DISTRIBUTOR:                                 VERICHIP CORPORATION, a
RussGPS, Ltd., a Russian company             Delaware Corporation,
organized and existing under                 on the date shown below:
the laws of Russia:

  /S/ Pavel Panov                            /S/ Keith Bolton
-----------------------------------          ----------------------------------
By: Pavel Panov                              By: Dr. Keith Bolton
    -------------------------------              ------------------------------
Title: President                             Title: President
       ----------------------------                 ---------------------------
Date: May 30, 2003                           Date: May 30, 2003
      -----------------------------                ----------------------------