Applied Digital Solutions Continues International VeriChip Expansion With New Latin American Distribution Agreement and First Authorized Representative in Europe.

Business Editors/High-Tech Writers

PALM BEACH, Fla.--(BUSINESS WIRE)--Oct. 25, 2002

Applied Digital Solutions, Inc.(Nasdaq: ADSX):

With the Signing of an Exclusive Distributor in Ecuador,

International Distributors Have Now Committed to Minimum Purchases

in Excess of $11 Million

"Due Diligence" Agreements Signed With an Airline,

a Shipping/Cargo Company and a Credit Union in China

Applied Digital Solutions, Inc. (Nasdaq: ADSX) an advanced technology development company, announced today that its wholly owned subsidiary, VeriChip Corporation, has signed a new Latin American distribution agreement and has appointed its first authorized representative in Europe.

In addition, the Company has signed "due diligence" agreements with three private companies based in China.

The Company has signed an exclusive VeriChip(TM) distribution agreement with Special Personal & Car Security, a private security company based in Quito, Ecuador. The five-year agreement, which covers the 2003-2007 period, calls for a minimum purchase quota in excess of $2 million. If the distributor fails to meet annual minimum purchase quotas, it will sacrifice its exclusive status. As a result of this new agreement, VeriChip has now received minimum purchase quotas in excess of $11 million over the next five years from its Latin American distributors. The Company views Latin America as a major component of VeriChip's business model due to enhanced safety and personal identification concerns in the region.

In Europe, the company has appointed its first authorized representative. Based in Italy, this representative has extensive experience in both commercial and government sectors. Following extensive evaluation of the European market (with a focus initially on Italy) both companies believe that VeriChip's subdermal personal verification technology will have multiple applications, particularly in the areas of personal security, emergency identification and healthcare.

The Company has also signed confidential "due diligence" agreements, all similar in terms, with three private Chinese corporations: an airline, a shipping/cargo company, and a credit union. The "due diligence" agreements, which are a commonly used first step in developing serious, ongoing business relationships in China, were signed following a recent visit to China by a representative of VeriChip Corporation. If the due diligence process yields favorable results, the parties are expected to pursue follow-on agreements involving minimum purchase requirements and other considerations. The expected time frame to complete the due diligence process varies from 30 days to six months depending on a variety of factors. All or none of these companies could decide to pursue an ongoing contractual relationship at a future date.

During the due diligence process, the Chinese companies involved will conduct product compatibility testing and explore appropriate marketplace applications in China for both VeriChip and Digital Angel(TM). Applications of particular interest include building access security, port security, employee identification systems, and cargo tracking.

About VeriChip(TM)

VeriChip is a miniaturized radio frequency identification device (RFID) that can be used in a variety of security, financial, emergency identification and healthcare applications. About the size of a grain of rice, each VeriChip product contains a unique verification number and will be available in several formats, some of which will be insertable under the skin. The verification number is captured by briefly passing a proprietary scanner over the VeriChip. A small amount of radio frequency energy passes from the scanner energizing the dormant VeriChip, which then emits a radio frequency signal transmitting the verification number. "Getting chipped" is a simple, outpatient procedure that lasts just a few minutes and involves only local anesthetic and insertion of the chip. VeriChip Corporation is a wholly owned subsidiary of Applied Digital Solutions.

About Applied Digital Solutions, Inc.

Applied Digital Solutions is an advanced technology development company that focuses on a range of life-enhancing, personal safeguard technologies, early warning alert systems, miniaturized power sources and security monitoring systems combined with the comprehensive data management services required to support them. The Company's Advanced Technology Group offers a complete CRM solution to commercial and government customers, as well as a full array of security-related data collection, value-added data intelligence and complex data delivery systems for a wide variety of end users including commercial operations, government agencies and consumers. Applied Digital Solutions is the beneficial owner of a majority position in Digital Angel Corporation (AMEX: DOC). For more information, visit the Company's website at http://www.adsx.com.

Statements about the Company's future expectations, including future revenues and earnings, and all other statements in this press release other than historical facts are `forward-looking statements' within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as that term is defined in the Private Litigation Reform Act of 1995. The Company intends that such forward-looking statements involve risks and uncertainties and are subject to change at any time, and the Company's actual results could differ materially from expected results. The Company undertakes no obligation to update forward-looking statements to reflect subsequently occurring events or circumstances.