Document:

Exhibit 10.5

                              SETTLEMENT AGREEMENT

         SETTLEMENT AGREEMENT entered into this 16th day of January, 2001 by and
between  David  Romano  ("Romano"),  Eric  Limont  ("Limont")  and  New  England
Technologies,  Inc. ("NETI"),  on the one hand, and IntelleSale,  Inc. (formerly
known as IntelleSale.com, Inc.) ("Intellesale"), Applied Digital Solutions, Inc.
(formerly known as Applied Cellular  Technology,  Inc.) ("ADSX"),  Bostek,  Inc.
("Bostek"),  Micro Components International Incorporated ("Micro"), Marc Sherman
("Sherman"),  Edward L. Cummings ("Cummings"),  Michael Krawitz ("Krawitz"), and
Charles D. Newman ("Newman"), on the other hand. Limont and Romano are sometimes
hereinafter  referred to collectively as the  "Plaintiffs" and individually as a
"Plaintiff".   Intellesale  and  ADSX  are  sometimes  hereinafter  referred  to
collectively  as  the  "Initial  Defendants"  and  individually  as an  "Initial
Defendant";  Bostek, Micro, Sherman,  Cummings, Krawitz and Newman are sometimes
hereinafter   referred  to  collectively   as  the   "Subsequent   Parties"  and
individually  as a  "Subsequent  Party";  and  the  Initial  Defendants  and the
Subsequent  Parties are sometimes  hereinafter  referred to  collectively as the
"Defendants" and individually as a "Defendant".

         WHEREAS, Intellesale, as buyer, ADSX, as guarantor, and the Plaintiffs,
as sellers,  executed an  Agreement  of Purchase  and Sale,  dated as of June 4,
1999,  as amended (the  "Agreement"),  and the  Plaintiffs  and Bostek  executed
separate  Employment  and  Non-Compete  Agreements,  dated as of June  30,  1999
("Employment and Non-Compete Agreements").

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         WHEREAS,  the Plaintiffs  commenced a civil action in the United States
District  Court for the  District of  Delaware  entitled  David  Romano and Eric
Limont v. IntelleSale.com, Inc. and Applied Digital Solutions, Inc. Civil Action
No. 00-126-RRM,  and in connection therewith asserted various claims against the
Initial Defendants,  which, in turn, asserted various  counterclaims against the
Plaintiffs (the "Delaware Action").

         WHEREAS, Intellesale, Bostek, and Micro commenced a civil action in the
Plymouth Superior Court in Massachusetts entitled IntelleSale.com, Inc., Bostek,
Inc. and Micro  Components  International  Incorporated v. David Romano and Eric
Limont, Civil Action No. 00-0571-B, and in connection therewith asserted various
claims against the Plaintiffs (the "Massachusetts State Action").

         WHEREAS,  the  Plaintiffs  commenced  a civil  action  in the  Plymouth
Superior Court in  Massachusetts,  which was subsequently  removed to the United
States District Court for the District of Massachusetts and there entitled David
Romano and Eric Limont v. Marc Sherman, Edward L. Cummings, Michael Krawitz, and
Charles D.  Newman,  Civil Action No.  11805-RWZ,  and in  connection  therewith
asserted  various  claims  against  Sherman,  Cummings,  Krawitz and Newman (the
"Massachusetts  Federal  Action")  (collectively,  with the Delaware  Action and
Massachusetts State Action, the "Civil Actions").

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         WHEREAS,  the parties  hereto have denied any liability  whatsoever and
have  agreed to enter into this  Settlement  Agreement  solely in order to avoid
further time and expenses;

         NOW,  THEREFORE,  in consideration  of the mutual  covenants  contained
herein and for other good and valuable  consideration,  the receipt and adequacy
of which is  hereby  acknowledged,  the  Plaintiffs,  on the one  hand,  and the
Defendants, on the other hand, hereby agree as follows:

         1. Subject to the terms and  conditions  set forth herein,  ADSX hereby
agrees to issue and sell to the Plaintiffs, and the Plaintiffs agree to purchase
from ADSX, at the Closing (as hereinafter  defined) (a) 985,222 shares of Common
Stock of ADSX (the  "Tranche A Shares") in  consideration  of the  execution and
delivery to ADSX by the  Plaintiffs of a Non-Interest  Bearing,  Non-Negotiable,
Non-Recourse,  30 Day  Promissory  Note  in the  original  principal  amount  of
$2,000,000 in the form of Exhibit A-1 hereto (the "Tranche A Note"),  subject to
adjustment as hereinafter provided,  and (b) 1,970,443 shares of Common Stock of
ADSX (the "Tranche B Shares") in  consideration of the execution and delivery to
ADSX by the Plaintiffs of a Non-Interest Bearing, Non-Negotiable,  Non-Recourse,
Fourteen Month Promissory Note in the original principal amount of $4,000,000 in
the form of  Exhibit  A-2  hereto  (the  "Tranche  B Note")  and the  Collateral
Assignment  by the  Plaintiffs to ADSX of the Tranche A Shares and the Tranche B
Shares  pursuant  to the terms of a Pledge  Agreement  in the form of  Exhibit B
hereto (the "Pledge  Agreement").  The Tranche A Note and the Tranche B Note are

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sometimes  hereinafter  referred to collectively as the "Notes" and individually
as a "Note".  From time to time during the term of either Note,  the  Plaintiffs
shall have the right (but not the obligation,  except as provided in the Tranche
A Note) to make payments or prepayments of the principal  amount of either Note.
Each payment or prepayment of the Notes shall be accompanied by a statement from
the  Plaintiffs  specifying to which Note such payment or  prepayment  should be
applied. Simultaneously with each such payment or prepayment, in accordance with
the terms of the Pledge Agreement, a pro rata portion of the Tranche A Shares or
the Tranche B Shares, as applicable,  shall be released from the lien created by
the Pledge  Agreement and  certificates  for such  released  Tranche A Shares or
Tranche B Shares, as applicable,  shall be delivered to the Plaintiffs  together
with separate  stock powers  endorsed to the Plaintiffs  (signature  guaranteed)
together with all other  documents  necessary to enable the Plaintiffs to freely
trade  such  released  Tranche A Shares or  Tranche B Shares.  The Notes and the
Pledge  Agreement  will be executed at the Closing and  delivered  to ADSX.  The
certificates  for the Tranche A Shares and the Tranche B Shares,  together  with
duly  endorsed  stock  powers,  will be executed at the Closing and delivered to
Greenberg  Traurig,  LLP, counsel to the Plaintiffs (the "Escrow Agent"),  to be
held in escrow pursuant to the terms of the Escrow Agreement  attached hereto as
Exhibit C. Not less than 10 days  prior to the  Closing,  ADSX shall  notify the
Plaintiffs and the Escrow Agent of the proposed date of the Closing.

         Plaintiffs  agree that so long as they own Shares,  they will vote such
shares in  accordance  with the  recommendations  of  management.  The Tranche A
Shares and the Tranche B Shares (sometimes  hereinafter referred to collectively
as the  "Shares") are shares of the Common Stock of ADSX as  constituted  on the

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date  hereof,  but if, and  whenever,  prior to the  issuance by ADSX of a stock
certificate(s)  for all of such Shares,  ADSX shall (i) effect a subdivision  or
consolidation of the shares of the Common Stock of ADSX outstanding, the payment
of a stock  dividend on the Common Stock of ADSX, or other increase or reduction
in the  number  of  shares  of the  Common  Stock  of ADSX  outstanding  without
receiving  compensation  per share  therefor in money  equivalent to the closing
price of a share of  Common  Stock  of ADSX on the  date of the  transaction  in
question, or (ii) issues any options, warrants or other rights to acquire shares
of Common Stock of ADSX for less consideration per share than an amount in money
equivalent  to the closing  price of a share of Common Stock of ADSX on the date
of the transaction in question (collectively,  a "Dilution Event"), then, (a) in
the event of an increase in the number of such shares outstanding, the number of
the Shares to be purchased by the Plaintiffs  hereunder shall be proportionately
increased,  and (b) in the event of a  reduction  in the  number of such  shares
outstanding,  the number of Shares shall be proportionately reduced.. As used in
this  paragraph,  the "date of the  transaction in question" shall mean the date
that the transaction is agreed upon by definitive agreement.

         ADSX hereby  represents  and warrants to the  Plaintiffs  that ADSX has
filed on a timely  basis all filings  required  to be made under the  Securities
Exchange Act of 1934 and the rules and regulations  thereunder (the "1934 Act"),
except  as would  not  have a  material  adverse  effect  on ADSX,  and that all
information  required  to be  disclosed  by ADSX  under  the  1934  Act has been
disclosed. Plaintiffs acknowledge that they have requested not to be apprised of
any  material  nonpublic  information  about  ADSX  and  that in  entering  this
Settlement  Agreement they are not relying on ADSX to have provided  information
other than that information required to have been disclosed in the Form 10-Q for

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the third  quarter of 2000 or any Form 8-K that was  required to have been filed
after November 15, 2000.

         2. It is the  intention  of the parties that the Shares shall be freely
tradeable  immediately following the Closing. ADSX shall use its best efforts to
cause the Shares to be registered under the Securities Act of 1933 and the rules
and  regulations  of the  Securities  and Exchange  Commission  thereunder  (the
"Securities  Act") by March 30, 2001. In connection  therewith  ADSX will comply
with, and each of the other Defendants will use their respective best efforts to
cooperate with, the following obligations:

                  (a)  prepare  and file  with  the  Commission  a  registration
         statement  with  respect to the Shares on or before  March 15, 2001 and
         use its reasonable best efforts to cause such registration statement to
         become and remain effective for not less than the term of the Tranche B
         Note;

                  (b) prepare and file with the Commission  such  amendments and
         supplements to such  registration  statement and the prospectus used in
         connection  therewith  as may be  necessary  to keep such  registration
         statement effective and to comply with the provisions of the Securities
         Act with  respect to the sale or other  disposition  of all  securities
         covered by such registration  statement  whenever the seller or sellers
         of such  securities  shall desire to sell or  otherwise  dispose of the
         same;

                  (c)  furnish  to  Plaintiffs   and  to  the  duly   authorized
         underwriter  of each  Plaintiff  such number of copies of a prospectus,
         including  copies of a preliminary  prospectus,  prepared in conformity
         with the  requirements  of the Securities Act, and such other documents
         as the Plaintiffs or such underwriters may reasonably  request in order
         to facilitate the public sale or other disposition of the securities to
         be sold by the Plaintiffs;

                  (d) use its reasonable best efforts to register or qualify the
         securities  covered by such  registration  statement  (by  exemption or
         otherwise)  under  such  state  securities  or "Blue  Sky" laws of such
         jurisdictions  as each Plaintiff shall reasonably  request,  and do any
         and all other  acts and things  which may be  reasonably  necessary  or
         advisable  under  such  securities  or "Blue  Sky" laws to  enable  the
         Plaintiffs to consummate  the public sale or other  disposition in such
         jurisdictions of the securities to be sold by the Plaintiffs,  provided

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         that ADSX shall not for any such  purpose be required to consent to the
         general service of process in any such jurisdiction;

                  (e) before filing the registration  statement or prospectus or
         amendments or supplements thereto,  furnish to counsel selected by each
         Plaintiff  copies  of all such  documents  proposed  to be  filed,  and
         provide such counsel with a reasonable opportunity to comment thereon;

                  (f) in the event of any underwritten  public  offering,  enter
         into and perform its obligations  under an underwriting  agreement,  in
         usual  and  customary  form,  with  the  managing  underwriter  of such
         offering;

                  (g)  notify  each  Plaintiff  at any  time  when a  prospectus
         relating  thereto is required to be delivered  under the Securities Act
         of the  happening  of any  event as a result  of which  the  prospectus
         included in such registration statement, as then in effect, includes an
         untrue  statement of a material  fact or omits to state a material fact
         required  to be stated  therein  or  necessary  to make the  statements
         therein not misleading in the light of the circumstances then existing;

                  (h) at or prior to the  effectiveness  of the  registration of
         the Shares, cause all Shares registered pursuant hereto to be listed on
         each  securities   exchange  or  quotation   system  on  which  similar
         securities issued by ADSX are then listed;

                  (i)  provide a  transfer  agent and  registrar  for all Shares
         registered  pursuant hereto and a CUSIP number for all such Shares,  in
         each case not later than the effective date of such registration; and

                  (j) at the request of either  Plaintiff in connection  with an
         underwritten offering, furnish on the date or dates provided for in the
         underwriting  agreement:  (i) an opinion of counsel,  addressed  to the
         underwriters and the Plaintiffs, covering such matters as such counsel,
         underwriters  and sellers may  reasonably  agree upon,  including  such
         matters as are customarily furnished in connection with an underwritten
         offering  and (ii) a letter or letters from the  independent  certified
         public  accountants  of  ADSX  addressed  to the  underwriters  and the
         Plaintiffs, covering such matters as such accountants, underwriters and
         sellers may reasonably  agree upon, in which letter(s) such accountants
         shall state,  without  limiting the generality of the  foregoing,  that
         they are independent certified public accountants within the meaning of
         the Securities  Act and that in their opinion the financial  statements
         and  other  financial  data  of  ADSX  included  in  the   registration
         statement, the prospectus(es),  or any amendment or supplement thereto,
         comply  in  all  material  respects  with  the  applicable   accounting
         requirements of the Securities Act.

                  (k) take all such  other  actions as either  Plaintiff  or the
         underwriters,  if any,  reasonably  request  in  order to  expedite  or
         facilitate the registration and disposition of the Shares.

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         The  Plaintiffs  agree to use their best efforts to cooperate with ADSX
in carrying out the foregoing obligations of ADSX.
         3. The closing of the sale and  purchase of the Shares (the  "Closing")
shall take place immediately  following the effectiveness of the registration of
the Shares  pursuant to Section 2 hereof and the  compliance  by the  Defendants
with their  obligations under such Section.  At the Closing,  in addition to any
other instruments or documents referred to herein:

                           (a) ADSX  shall  deliver to the  Plaintiffs  separate
                  certificates   representing  the  Tranche  A  Shares  (2  ADSX
                  certificates  representing  50% each of the  total  amount  of
                  Tranche A Shares,  one in the name of each  Plaintiff) and the
                  Tranche  B  Shares  (40 ADSX  certificates,  19 in the name of
                  Romano for 50,000  shares each, 1 in the name of Romano in the
                  amount of 35,222  shares,  19 in the name of Limont for 50,000
                  shares  each,  and 1 in the name of  Limont  in the  amount of
                  35,222 shares),  duly endorsed or with duly executed signature
                  guaranteed stock powers attached. The Shares shall be free and
                  clear of any lien, claim or encumbrance  other than the pledge
                  of the Tranche B Shares under the Pledge Agreement.

                           (b) The Plaintiffs will execute and deliver  to  ADSX
                  the Notes and the Pledge Agreement.

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                           (c) The Plaintiffs  shall deliver to the Escrow Agent
                  the  Certificates  representing  the  Tranche A Shares and the
                  Tranche B Shares duly  endorsed in blank or with duly executed
                  signature guaranteed stock powers endorsed in blank attached.

                           (d) Limont and Romano will  collectively deliver   to
                  the  Escrow Agent  $2,000,000  as security for  the  Tranche A
                  Note.

         4. Simultaneously  herewith, the Plaintiffs shall cause their attorneys
to execute the Stipulations of Dismissal attached hereto as Exhibits D, E, and F
and the Defendants  shall cause their  attorneys to execute the  Stipulations of
Dismissal attached hereto as Exhibits D, E and F.

         5. The fully executed  Stipulations of Dismissal described in Paragraph
4 above shall be held in escrow by the Escrow  Agent under the Escrow  Agreement
pending completion of the Closing.  Following the Closing,  the Plaintiffs shall
cause their  attorneys to file with the United  States Court for the District of
Delaware,  the  United  States  Court for the  District  of  Massachusetts,  and
Plymouth County Superior Court, the Stipulations of Dismissal attached hereto as
Exhibits D, E, and F.

         6. In the event that the  Closing  has not  occurred  by April 9, 2001,
then the  maturity  under the  Tranche B Note shall be extended by one month for
each full week after April 9, 2001 that the  Closing is delayed  (other than due
to the failure of a closing  condition  within the control of the Plaintiffs) up
to a maximum extension of maturity of nine months. In the event that the Tranche
B Note is so extended,  the Plaintiffs  shall execute a replacement note for the

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Tranche B Note setting forth the extended maturity date for the Tranche B Shares
and such  replacement  note  shall be  deemed  to be the  Tranche B Note for all
purposes  hereunder.  In the event that the Closing has not occurred by June 15,
2001 (the  "Deadline")(other  than due to the  failure  of a  closing  condition
within the control of the  Plaintiffs)  the  Plaintiffs  shall have the right to
terminate  this  Settlement   Agreement  by  providing  written  notice  to  the
Defendants at any time prior to the date on which all the conditions for Closing
(other  than a  condition  within  the  control  of the  Plaintiffs)  have  been
satisfied.  The  Plaintiffs  shall  have the right in their  sole and  exclusive
discretion  to extend  the  Deadline  on one or more  occasions  by giving  ADSX
written  notice  thereof  and such  extended  date(s)  shall be deemed to be the
Deadline  for the  purposes  of this  Agreement.  ADSX  agrees that prior to the
Deadline it shall not attempt to register or participate in the  registration of
any shares of its capital stock under the  Securities Act (other than the Shares
and other than the shares of Common Stock currently being registered pursuant to
a pending  Registration  Statement).  In the event that the Plaintiffs terminate
this  Settlement  Agreement  pursuant to this  paragraph,  then this  Settlement
Agreement (except  paragraphs 9 and 14-22) and each other document,  instrument,
stipulation,  or agreement executed in connection herewith, shall be deemed null
and void and the Plaintiffs  shall,  consistent  with this  Paragraph,  have the
right to proceed with the prosecution of the Civil Actions.  Notwithstanding the
foregoing,  in the event that the Closing  does not occur due to a breach by the
Defendants  (or  any  of  them)  of  their  obligations  under  this  Settlement
Agreement,  the  Plaintiffs  may, as an  alternative  right and remedy,  seek to
recover from the  Defendants  for such breach.  In the event that the Plaintiffs
elect this remedy,  the Stipulations of Dismissal will nonetheless be filed with

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the  appropriate  courts and the claims of both parties in the Civil Actions may
not be  pursued.  During the period  from the date  hereof  until the earlier to
occur of the Closing or the  termination  date, the parties hereto agree to stay
the  prosecution  of the Civil Actions and to jointly file any and all pleadings
in the actions necessary to accomplish the foregoing.  Notwithstanding  anything
in Paragraph 6 to the contrary,  if, in connection with the  registration of the
Shares with the Commission, the Commission issues a comment letter that comments
on the  structure of the  transaction,  the price of the Shares or the manner of
payment  therefor,  the dates set forth in this Paragraph 6 shall be extended by
the period of time from the date such comment  letter is received until the date
the Commission informs ADS (in writing or otherwise) that its comments have been
resolved.,.  Provided,  however,  that,  in the  event  the  Commission  has not
approved the registration by June 15, 2001 because of the comments identified in
this paragraph (but not for reasons  unrelated to those issues)  Plaintiffs will
agree to an extension of the June 15, 2001 deadline,  which  extension shall not
be unreasonably withheld.

         7. Except for claims  arising  out of this  Settlement  Agreement,  and
subject to the condition precedent that the Closing has occurred, the Plaintiffs
and NETI, on the one hand, and the Defendants, on the other hand, hereby remise,
release and forever  discharge the other and their  representatives,  employees,
officers, directors,  shareholders,  members, agents, affiliates,  attorneys and
their successors and assigns, from any and all debts, demands,  actions,  causes
of action,  suits,  promissory notes, claims against collateral,  sums of money,
accounts,  bonds, covenants,  contracts,  controversies,  agreements,  promises,
damages,  executions and liabilities,  and any and all other claims of any kind,
nature  and  description  whatsoever,  both known and  unknown,  both in LAW and
EQUITY,  which they have or ever had against the other from the beginning of the

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world to this date, including,  without limitation,  all claims set forth in the
Civil Actions,  and any and all claims associated with or in connection with the
Agreement, Employment and Non-Compete Agreements and any documents,  instruments
or agreements  entered into in connection  therewith,  and all claims associated
with or in connection with the negotiation of this Settlement Agreement.
         The parties  hereto  further  acknowledge  and agree that they will not
(except as otherwise provided in this Agreement or as otherwise provided by law)
initiate  any action in, or file any civil or criminal  complaint  against  each
other with, any local, state or federal court,  administrative board, or agency,
with respect to any  transaction  occurring  from the  beginning of the world to
this date.

         8. The parties  hereto  hereby  acknowledge  and agree that any and all
rights, duties, indemnification or obligations which they may have had under the
Agreements, Employment and Non-Compete Agreements and any documents, instruments
and  agreements  entered into in connection  therewith  and any  indemnification
rights that the Plaintiffs may have had by statute, Articles of Incorporation or
Bylaws,  as  officers,  directors,  or  employees  of Bostek or Micro are hereby
extinguished  in  perpetuity  and have no further  force or effect.  The parties
agree that this  Settlement  Agreement  supersedes the underlying  Agreement and
Employment and Non-Compete Agreements in full force.

         9. ADSX,  Intellesale,  Bostek and Micro unconditionally assign without
representation  or recourse all of their rights and interest against Miami Micro
Distributors,  Inc. ("MMDI"), Reliant Innovations, Inc. ("Reliant"), Jeff Farber
("Farber"),  Don Resnick ("Resnick") and John Higgins ("Higgins") (collectively,

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"Reliant  Defendants"),  including,  without limitation,  all of their rights to
file  counterclaims  in the  case  pending  in the  Circuit  Court  for the 17th
Judicial   Circuit  in  and  for  Broward  County,   Florida   entitled  Reliant
Innovations,  Inc. v. Bostek,  Inc., Case No.: 00003256 (the "Reliant  Action").
ADSX and  Intellesale  expressly  agree that they will not assert in the Reliant
Action or elsewhere  (other than in the  Delaware  Action in the event it is not
dismissed)  that  the   transaction   consummated  by  the  Bostek  division  of
Intellesale in August of 1999 with the Reliant Defendants  constituted  anything
other  than a good  faith  effort by the  Plaintiffs  to  produce  a profit  for
Intellesale.  Furthermore  (other than in the Delaware Action in the event it is
not dismissed),  ADSX and Intellesale  will not assert that such transaction was
in any way  related to the  subsequent  payment by  Higgins  and  Resnick to the
Plaintiffs   personally.   The  Plaintiffs   waive  and  release  any  right  to
indemnification in connection with the matters alleged in the Reliant Action.

         The  Plaintiffs   agree  to  immediately   undertake  the  defense  and
prosecution of the Reliant Action and to indemnify  ADSX,  Intellesale,  Bostek,
Micro, and their respective officers, directors, and employees, for any judgment
(including  any judgment  which  attorneys'  fees and costs  incurred by MMDI or
Reliant) entered against them in that action. ADSX and Intellesale shall provide
their  full  cooperation  to the  Plaintiffs,  as well as  their  attorneys,  in
connection with the Reliant Action,  including,  without limitation,  making any
witness or document  available to the Plaintiffs without cost to the Plaintiffs.
The Plaintiffs  shall furnish to the Defendants any  non-privileged  information
concerning the Reliant  Action as the Defendants may reasonably  request and the
Defendants  shall  furnish  to the  Plaintiffs  any  non-privileged  information

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concerning the Reliant Action as the  Plaintiffs  may reasonably  request.  This
Paragraph shall survive termination pursuant to Paragraph 6.

         10.  The  Plaintiffs  shall  provide  their  full  cooperation  to  the
Defendants,  as well as their  attorneys,  in  connection  with the  defense  or
response to any claim asserted by third parties against Bostek and/or Micro with
respect to any transaction occurring prior to April 30, 2000, including, without
limitation,  making any witness or document  available to the Defendants without
cost to the Defendants.

         11. The  Tranche A Shares and  Tranche B Shares  will be  acquired  for
Romano's and Limont's own accounts,  not as nominees or agents,  for  investment
purposes  and not  with a view  to,  or for  offer  or sale in  connection  with
directly or indirectly,  any  distribution in violation of the Securities Act of
1933,  as amended (the "1933 Act") or any other  applicable  securities  law and
with  no  intention  of  participating  in  the  formulation,  determination  of
direction of the basic business  decisions of ADSX. Neither Romano nor Limont is
a registered  broker dealer or engaged in the business of being a broker dealer.
Each of Romano and Limont  acknowledges  that he can bear the economic  risk and
complete loss of his investment in the Tranche A Shares and Tranche B Shares and
has such  knowledge and  experience in financial or business  matters that he is
capable  of  evaluating  the  merits  and risks of the  investment  contemplated
hereby.  Romano and Limont acknowledge that ADSX filed its most recent Form 10-Q
on or about  November  15,  2000.  Each of Romano  and  Limont is an  accredited
investor as defined in Rule 501(a) of Regulation  D, as amended,  under the 1933
Act.

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          12. The parties  hereto  agree that they will  execute  such other and
further  agreements  that  they or  their  attorneys  determine  are  reasonably
necessary in order to effectuate the intent of this Settlement Agreement.

         13. This Settlement  Agreement  contains the entire  understanding  and
agreement  between  the parties and  incorporates  and merges  therein all prior
discussions, understandings and agreements, express or implied, oral or written,
between the parties. The Plaintiffs  acknowledge and agree that Richard Sullivan
and the  Subsequent  Parties did not orally  provide  them with any  information
about ADSX, the ADSX Common Stock,  or its prospects in the course of settlement
negotiations  and that they are not entering this Settlement  Agreement  because
of, or in reliance  on, any  statement  made by Mr.  Sullivan or the  Subsequent
Parties.  This Settlement  Agreement may be amended only by a written instrument
signed by all parties.

         14.  The  parties  executing  this  Settlement  Agreement  warrant  and
represent that they are duly authorized to enter into this Settlement Agreement.

         15.  This  Settlement   Agreement  may  be  executed  in  one  or  more
counterparts,  each of  which  shall be  deemed  an  original,  but all of which
together shall constitute one and the same instrument.

         16. The parties hereto  further  understand  and  acknowledge  that the
parties hereby  released do not admit liability for any of the alleged claims or
damages  in the  Civil  Actions  nor  admit  any  liability  for any  wrongdoing
whatsoever,  said liability being expressly  denied,  and that the consideration
furnished herein is in compromise and settlement only.

                                       15
<PAGE>

         17. No party has  assigned,  transferred,  or granted,  or purported to
assign,  transfer,  or grant to any third  party any  rights to or claims in the
Civil Actions or Arbitration, or any right or claim which is the subject of this
Settlement Agreement.

         18. Each party to this Settlement  Agreement has had the opportunity to
receive  and  has  retained  independent  legal  counsel  with  respect  to this
Settlement Agreement and the advisability of executing same.

         19. This Settlement Agreement shall be binding upon and shall inure  to
the parties and their successors and assigns.

         20. In  case  any  one  or more  of the  provisions  contained  in this
Settlement  Agreement  should be held or  determined  to be invalid,  illegal or
unenforceable in any respect,  the validity,  legality and enforceability of the
remaining  provisions  contained  herein  and  therein  shall  not in any way be
affected thereby.

         21. The parties  hereto  agree that,  prior to the  institution  of any
civil action  concerning any dispute  arising out of or in connection  with this
Settlement  Agreement  and  the  transactions  contemplated  hereby,  including,
without  limitation,  any action arising out of or in connection  with the Notes
and/or Pledge  Agreement,  they will promptly submit such dispute to non-binding
mediation  before the American  Arbitration  Association in accordance  with its
rules then in effect. The mediation shall occur in Wilmington, Delaware.

         22. This  Settlement  Agreement  shall be governed by and construed and
enforced  in  accordance  with  the law of the  State of  Delaware.  Each of the
parties hereto hereby irrevocably and unconditionally  consents to submit to the
exclusive  jurisdiction  of the United  States  District  Court for  District of

                                       16
<PAGE>

Delaware for any action  arising out of or in  connection  with this  Settlement
Agreement  and  the  transactions   contemplated  hereby,   including,   without
limitation,  any action  arising out of or in  connection  with the Notes and/or
Pledge  Agreement (and agrees not to commence any action relating thereto except
in such courts), and further agrees that service of any process, summons, notice
or document by U.S.  registered mail to its respective address set forth in this
Settlement  Agreement  shall be  effective  service  of  process  for any action
brought  against that party.  Each of the parties hereto hereby  irrevocably and
unconditionally  waives  any  objection  to the  laying  of venue of any  action
arising  out of  this  Settlement  Agreement  or the  transactions  contemplated
hereby,  including,  without  limitation,  any  action  arising  out  of  or  in
connection with the Notes and/or Pledge Agreement, in the United States District
Court  for  the  District  of  Delaware,  and  hereby  further  irrevocably  and
unconditionally  waives  and agrees not to plead or claim in such court that any
such action brought in such court has been brought in an inconvenient forum.

                  [Remainder of Page Intentionally Left Blank;
                           Signature Pages to Follow]

                                       17
<PAGE>

         IN WITNESS  WHEREOF,  the parties set their hands and seals,  as of the
dates set forth above.

NEW ENGLAND TECHNOLOGIES,                        APPLIED DIGITAL SOLUTIONS, INC.
INC.

___________________________
                                                 -------------------------------
By:                                              By:

                                                 INTELLESALE, INC.

----------------------------                     -------------------------------
David Romano                                     By:

                                                 BOSTEK, INC

----------------------------                     -------------------------------
Eric Limont                                      By:

                                                 MICRO COMPONENTS  INTERNATIONAL
                                                 INCORPORATED

                                                 -------------------------------
                                                 By:

                                                 -------------------------------
                                                 Marc Sherman

                                                 -------------------------------
                                                 Edward L. Cummings

                                                 -------------------------------
                                                 Michael Krawitz

                                                 -------------------------------
                                                 Charles D. Newman

                                       18<PAGE>   1
                                                                    EXHIBIT 10.6

  AGREEMENT FOR THE MERGER OF ASIAINFO TECHNOLOGIES (CHINA) INC. AND ZHEJIANG
                ASIAINFO TELECOMMUNICATION TECHNOLOGY CO., LTD.

Party A:          AsiaInfo Technologies (China) Inc.

Address:          3/F Zhongdian Information Tower, No. 18 Baishiqiao Road,
                  Haidian District, Beijing, China

Authorized Representative: Wang Qindai

Party B:          Zhejiang AsiaInfo Telecommunication Technology Co., Ltd.

Address:          22/F and 23/F Block B Yaojiang International Building, No.
                  100, Moganshan Road, Hangzhou

Authorized Representative: Gong Hongjia

Whereas:

(A)     Party A is a foreign investment enterprise validly established and
        existing under the approval of the Beijing Foreign Economic and Trade
        Commission, having a legal person status.

(B)     Party B is a foreign investment enterprise validly established and
        existing under the approval of the Zhejiang Foreign Economic and Trade
        Office, having a legal person status.

(C)     Party A and Party B have agreed to merge with each other after friendly
        consultations.

        For the purpose of defining the rights and obligations of the Parties,
ensuring the smooth completion of the merger, Party A and Party B have entered
into this Merger Agreement on the basis of the principle of free will and
equality in accordance with the relevant laws and regulations.

1.      DEFINITION

        Merger shall mean the merger of Party A with Party B.

        Related Contracts shall mean loan agreements, pledge agreements and
other contracts entered into by Party B and approved by Party A.

2.      FORM OF MERGER

        Party A and Party B agree that the Merger shall take the form of
amalgamation. Party A shall survive the Merger and Party B shall be dissolved
after the Merger.

        Upon the Merger, the total amount of investment made by Party A shall be
US$20,000,000. The registered capital of the new company shall be US$13,500,000.

3.      RIGHTS AND LIABILITIES

        Upon the Merger, the rights and liabilities of Party B shall be enjoyed
and assumed by Party A.

4.      RELATED CONTRACTS

(1)     Upon the Merger, Party A shall become a party to the Related Contracts
        entered into by Party B in accordance with law.

(2)     In the case where the main body of a Related Contract is to be altered,
        Party B shall assist Party A in completing the necessary formalities.

5.      WORK ARRANGEMENTS FOR STAFF AND WORKERS

        Upon the Merger, the staff of Party B shall be transferred to Party A's
office in Hangzhou.

                                      -1-
<PAGE>   2
6.      MATTERS RELATING TO THE MERGER

(1)     Party A shall be authorized to take over the assets of Party B pursuant
        to this Agreement and dispose of such assets upon the completion of the
        Merger.

(2)     Party A shall be authorized to request Party B to transfer all documents
        relating to Party B's operating assets to Party A. Such documents
        include but are not limited to all kinds of accounts, books and records
        and information on equipment and technology.

(3)     Party B shall provide Party A with the assistance required for the
        performance of formalities required for the Merger.

7.      LIABILITY FOR BREACH

(1)     Any Party acting in violation of this Agreement shall constitute a
        breach of contract and such Party shall assume liability for breach and
        compensate the other Party for any losses incurred as a result of such
        breach. Where both Parties have committed a default, the amount of
        compensation shall be determined on the basis of the seriousness of the
        default.

(2)     If this Agreement cannot be performed due to force majeure and
        modifications of Chinese laws and industrial policy, no Party shall be
        required to assume liability for breach of contract.

8.      RESOLUTION OF DISPUTES

(1)     Any dispute between Party A and Party B arising from the interpretation
        or performance of this Agreement shall be settled through friendly
        consultations as far as practicable.

(2)     If Party A and Party B fail to reach an agreement within 20 days after
        the commencement of friendly consultations, either Party may apply for
        arbitration to the China International Economic and Trade Arbitration
        Commission.

9.      SUPPLEMENTARY PROVISIONS

(1)     Party A and Party B may enter into a supplementary agreement to deal
        with matters that have not been covered under this Agreement. The
        Supplementary Agreement and this Agreement shall carry equal legal
        force.

(2)     This Agreement shall become effective after signing by the legal
        representatives or authorized representatives of both Parties and
        affixing of the chops of both Parties.

(3)     This Agreement shall be executed in 4 copies. Each Party shall hold 2
        copies. All copies are equally valid.

Party A: AsiaInfo Technologies (China) Inc.

Legal Representative or Authorized Representative:

(seal)

Party B: Zhejiang AsiaInfo Communication Technology Co., Ltd.

Legal Representative or Authorized Representative:

(seal)

Date:

                                      -2-

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