Global Digital Solutions and Planned Merger Partner Airtronic USA Agree to Details for Amended Bridge Loan Facility Providing An Additional $550,000 to Enable Airtronic to Complete Previously Announced Contracts and Purchase Orders of Considerable Value

PALM BEACH, Fla., Aug. 7, 2013 /PRNewswire/ -- Global Digital Solutions (PINKSHEETS:GDSI),a company that is positioning itself as a leader in providing small arms manufacturing, knowledge-based and culturally attuned social consulting combined with complementary security and technology-related solutions in unsettled areas, today announced an agreement with planned merger partner Airtronic USA, Inc. ("Airtronic") to an amended bridge loan facility that will provide an additional $550,000 to enable Airtronic to complete previously announced contracts and purchase orders of considerable value.

On May 30, 2013, GDSI and Airtronic announced the first in what is expected to be a series of contracts involving the company's core business products.  On June 24, 2013, the two companies announced that Airtronic agreed to become an OEM supplier to a major international defense contractor for the Airtronic family of M203 grenade launchers and received the first of many expected orders for M203 grenade launchers.

"We're very excited about the contracts and purchase orders Airtronic has received recently and we're pleased we have worked out the details in the amended loan facility so Airtronic can fulfill these customer orders," said Richard J. Sullivan, who will become Chairman and CEO of GDSI after the acquisition with Airtronic is completed. "We're also delighted that we have worked out the details involving Dr. Merriellyn Kett's five-year, post-confirmation employment contract and certain intellectual property matters.   These and a few other rather technical issues required revisions in the loan agreement.  All of these revisions will help ensure the long-term success of this enterprise. Because of summertime schedules, it has been difficult to work out certain details as quickly as we anticipated.  We hope the court will agree to these reasonable revisions to the loan agreement and that we'll be able to move forward with the confirmation process as expeditiously as possible."

On August 5, 2013, Airtronic filed a motion with the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division, requesting an order to accept revised documents related to Airtronic's Second Debtor In Possession ("DIP") Loan Modification and Ratification Agreement.  

As announced on July 1, 2013, the United States Bankruptcy Court for the Northern District of Illinois, Eastern Division, had set August 7, 2013, as the confirmation hearing date for Airtronic's Amended Plan of Reorganization ("Plan").  It is expected that the court will also set a new date for the confirmation hearing. 

"We're thrilled that we have reached agreement with GDSI on these issues," said Dr. Merriellyn Kett, Airtronic's President and CEO who will continue serving as CEO after the merger between GDSI and Airtronic is finalized. "We're looking forward to completing the work on these new contracts and purchase orders in the coming months and to developing an amended plan of reorganization for the court's consideration."

On or about August 13, 2012, GDSI and Airtronic announced that they had signed a letter of intent to enter into good faith discussions involving a potential strategic combination in which Airtronic would be acquired by GDSI. Having completed those good faith discussions, the companies signed a merger agreement on or about October 22, 2012.  The companies are working together to file an Amended Plan of Reorganization ("Plan"). If confirmed, the Plan will allow Airtronic to emerge from chapter 11 bankruptcy with adequate working capital.

Founded in 1990, Airtronic is a well-respected, award-winning manufacturer of critical battlefield weapons. A member of the National Small Arms Technology Consortium (NSATC) and the largest woman-owned small arms manufacturing company in the United States, Airtronic has received commendations from the US Army Tank, Armaments, and Automotive Command and the Defense Logistics Agency for the quality and on-time delivery of its products.

More About Richard J. Sullivan
Dick Sullivan is an entrepreneurial pioneer. In 2001, Sullivan received the prestigious World Economic Forums Award for Advanced Chip Technology presented in Davos, Switzerland. He served as Chairman and CEO of Applied Digital Solutions, where he executed a technology rollup involving 42 acquisitions that succeeded in increasing the company's share price from $2.50 to a peak of $18 per share. During Sullivan's decade-long tenure as Chairman and CEO, Applied Digital was one of the highest volume traded stocks on NASDAQ. Sullivan also served as Chairman and CEO of Digital Angel Corporation and led the effort to spin off VeriChip Corporation. In 1970, he was a founding member of the management team of Manufacturing Data Systems, Inc., which listed at $7.50 per share and was sold to Schlumberger N.V. in 1980 at $65 per share.

More About Merriellyn Kett, PhD
Airtronic's CEO and President joined the company in 2003 as a partner and helped to refocus the business on several essential battlefield weapons, including the M203 40mm Grenade Launcher – one of the most widely used grenade launchers in the world – the .50 cal. Machine Gun, the MK 19 Grenade Machine Gun, and most recently the MK 777, a shoulder-fired recoilless weapon that is light, lethal, and affordable. Dr. Kett received her doctorate in analytic philosophy from DePaul University in Chicago, IL, and spent a year studying at the Sorbonne in Paris, France.  Before joining Airtronic in 2003, she worked in infrastructure development in China, building a metallurgical coking plant in Shanxi Province. 

About Global Digital Solutions, Inc.
Global Digital Solutions is refocusing its business strategy on providing small arms manufacturing, knowledge-based and culturally attuned social consulting combined with complementary security and technology-related solutions in unsettled areas. For more information please visit http://www.gdsi.co.

About Airtronic USA, Inc.
Airtronic is an electro-mechanical engineering design and manufacturing company.  The largest woman-owned small arms manufacturer in the United States, Airtronic provides small arms and small arms spare parts to the U.S. Department of Defense, foreign militaries and the law enforcement market.  The company also manufactures medical, avionics and telecommunications original equipment. The company's products include grenade launchers, rocket propelled grenade launchers, grenade launcher guns, flex machine guns, grenade machine guns, rifles, and magazines. Founded in 1990, the company is based in Elk Grove Village, Illinois.  On May 16, 2012, the voluntary petition of Airtronic, Inc. for liquidation under Chapter 7 was converted to Chapter 11 reorganization. The company had filed for Chapter 7 bankruptcy on March 13, 2012. For more information, please visit www.Airtronic.net.

Statements about the company's expectations, including revenue and earnings and all other statements in this press release, other than historical facts, are "forward looking" statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward looking statements involve risks and uncertainties and are subject to change at any time. The company's actual results could differ materially from expected results. In reflecting subsequent events or circumstances, the company undertakes no obligation to update forward looking statements. 

Contact:

William J. Delgado
916-838-8833
[email protected]

Richard J. Sullivan
561-632-1020
[email protected]

SOURCE Global Digital Solutions, Inc.