Indemnification Letter Agreement between VeriChip Corporation, VeriChip Inc., and Applied Digital Solutions, Inc. (December 21, 2005)

Exhibit 2.6

December 21, 2005

Applied Digital Solutions, Inc.

1690 South Congress Ave., Ste. 200

Delray Beach, FL 33445

Attention: Evan McKeown, CFO

Dear Evan:

Reference is made to the acquisition, by VeriChip Inc. (“VCI”), of Instantel, Inc (the “Acquisition”). In connection with the Acquisition, VCI is obligated to make a deferred payment to the sellers of up to $3 million (the “Second Payment”). In a definitive agreement in connection with the Acquisition, Applied Digital Solutions, Inc. (“AD”) guaranteed that VCI’s Second Payment obligation. This letter shall confirm the following: should VCI fail to make the Second Payment, and should AD be called upon under the guarantee to satisfy such Second Payment, then VeriChip Corporation (the parent of VCI) and VCI will, jointly and severally, indemnify AD for its actual out-of-pocket costs (valuing any stock conveyed at its fair market value) in honoring such guarantee. This letter confirms the arrangement that was determined at the time of the Acquisition (in connection with which AD provided substantial funds to VCI to allow VCI to effect the Acquisition).

Accepted: