CONTINUING UNCONDITIONAL GUARANTY
 
This CONTINUING UNCONDITIONAL GUARANTY (this “Guaranty”), is made this 24th day
of August, 2007, by LOGISTICAL SUPPORT, INC., a Utah corporation, having a
mailing address at 19734 Dearborn Street, Chatsworth, California 91311 (the
“Guarantor”) in favor of and for the benefit and security of DUTCHESS PRIVATE
EQUITIES FUND, LTD., having a mailing address at 50 Commonwealth Avenue, Suite
2, Boston, Massachusetts 02116 (the “Secured Party”).
 
WHEREAS, pursuant to one or more promissory notes or other debentures or
instruments, including, without limitation, that certain Purchase Order
Financing Agreement (as amended or otherwise modified from time to time, the
“Finance Agreement”) of even date herewith between Logistical Support, LLC (the
“Company”) and Secured Party (collectively with the Finance Agreement, as
amended or otherwise modified from time to time, collectively, the “PO
Financing”), the Secured Party has agreed to make certain loans and other
financial accommodations to the Company;
 
WHEREAS, Guarantor is desirous of having the Secured Party extend and/or
continue the extension of credit to the Company, and the Secured Party has
required that Guarantor execute and deliver this Guaranty to the Secured Party,
as a condition to the extension and continuation of credit by the Secured Party;
and
 
WHEREAS, the extension and/or continued extension of credit, as aforesaid, by
the Secured Party is necessary and desirable to the conduct and operation of the
business of the Company, and Guarantor will derive substantial benefits from the
credit made available to the Company pursuant to the PO Financing;
 
NOW, THEREFORE, for value received and in consideration of any loan, advance, or
financial accommodation of any kind whatsoever heretofore, now or hereafter
made, given or granted to the Company by the Secured Party, Guarantor agrees as
follows:
 
1. Guarantor unconditionally guaranties (i) the full and prompt payment when
due, whether at maturity or earlier, by reason of acceleration or otherwise, and
at all times thereafter, of all of the indebtedness, liabilities and obligations
of every kind and nature of the Company to the Secured Party or any parent,
affiliate or subsidiary of the Secured Party (the terms “Secured Party” as used
hereafter shall include such parents, affiliates and subsidiaries), howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, joint or several, now or hereafter existing, or due or to become
due, and howsoever owned, held or acquired by the Secured Party, whether through
discount, overdraft, purchase, direct loan or as collateral or otherwise,
including, without limitation, all obligations and liabilities of the Company to
the Secured Party under the PO Financing, and (ii) the prompt, full and faithful
discharge by the Company of each and every term, condition, agreement,
representation and warranty now or hereafter made by the Company to Secured
Party (all such indebtedness, liabilities and obligations being hereinafter
collectively referred to as the “Liabilities”). Guarantor further agrees to pay
all costs and expenses, including, without limitation, all court costs and
reasonable attorneys’ and paralegals’ fees paid or incurred by Secured Party in
endeavoring to collect all or any part of the Liabilities from, or in
prosecuting any action against, Guarantor. All amounts payable by Guarantor
under this Guaranty shall be payable by Guarantor upon demand by Secured Party.
 
 
 

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2. Notwithstanding any provision of this Guaranty to the contrary, it is
intended that this Guaranty, and any liens and security interests granted by
Guarantor to secure this Guaranty, not constitute a “Fraudulent Conveyance” (as
defined below). Consequently, Guarantor agrees that if this Guaranty, or any
liens or security interests securing this Guaranty, would, but for the
application of this sentence, constitute a Fraudulent Conveyance, this Guaranty
and each such lien and security interest shall be valid and enforceable only to
the maximum extent that would not cause this Guaranty or such lien or security
interest to constitute a Fraudulent Conveyance, and this Guaranty shall
automatically be deemed to have been amended accordingly at all relevant times.
For purposes hereof, “Fraudulent Conveyance” means a fraudulent conveyance under
Section 548 of the “Bankruptcy Code” (as hereinafter defined) or a fraudulent
conveyance or fraudulent transfer under the provisions of any applicable
fraudulent conveyance or fraudulent transfer law or similar law of any state,
nation or other governmental unit, as in effect from time to time.
 
3. Guarantor hereby agrees that this Guaranty is a guaranty of payment and
performance and not of collection, and that, except as hereinafter provided, its
obligations under this Guaranty shall be unconditional, irrespective of (i) the
validity or enforceability of the Liabilities or any part thereof, or of any
promissory note or other document evidencing all or any part of the Liabilities,
(ii) the absence of any attempt to collect Liabilities from the Company or any
other guarantor or other action to enforce the same, (iii) the waiver or consent
by Secured Party with respect to any provision of any instrument evidencing
Liabilities, or any part thereof, or any other agreement heretofore, now or
hereafter executed by Company and delivered to Secured Party, (iv) failure by
Secured Party to take any steps to perfect and maintain its security interest
in, or to preserve its rights to, any security or collateral for Liabilities,
(v) the institution of any proceeding under Chapter 11 of Title 11 of the United
States Code (11 U.S.C. §101 et seq.), as amended (the “Bankruptcy Code”) or any
similar or analogous statutory or nonstatutory proceedings under any other law,
whether state, provincial or federal, now existing or hereafter existing for
relief of the debtors, by or against Company, (vi) Secured Party’s election in
any such proceeding of the application of Section 1111(b)(2) of the Bankruptcy
Code, (vii) any borrowing or grant of a security interest by Company as
debtor-in-possession, under Section 364 of the Bankruptcy Code, (viii) the
disallowance, under Section 502 of the Bankruptcy Code, of all or any portion of
Secured Party’s claim(s) for repayment of Liabilities, or (ix) any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a guarantor.
 
4. Guarantor hereby waives diligence, presentment, demand of payment, filing of
claims with a court in the event of receivership, insolvency or bankruptcy of
the Company, protest or notice with respect to Liabilities and all demands
whatsoever, and covenants that this Guaranty will not be discharged, except by
complete performance of the obligations and liabilities contained herein. Upon
any default by the Company as provided in any instrument or document evidencing
all or any part of Liabilities, including, without limitation, the PO Financing,
Secured Party may, at its sole election, proceed directly and at once, without
notice, against Guarantor to collect and recover the full amount or any portion
of Liabilities, without first proceeding against the Company, or any other
person, firm, or corporation, or against any security or collateral for
Liabilities.
 
 
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5. Secured Party is hereby authorized, without notice or demand and without
affecting the liability of Guarantor, to at any time and from time to time (i)
renew, extend, accelerate or otherwise change the time for payment of, or other
terms relating to, Liabilities or otherwise modify, amend or change the terms of
any promissory note or other agreement, document or instrument now or hereafter
executed by the Company and delivered to Secured Party; (ii) accept partial
payments on Liabilities; (iii) take and hold security or collateral for the
payment of Liabilities guaranteed hereby, or for the payment of this Guaranty,
or for the payment of any other guaranties of Liabilities or other liabilities
of the Company, and exchange, enforce, waive and release any such security or
collateral; (iv) apply such security or collateral and direct the order or
manner of sale thereof as in its sole discretion it may determine; and (v)
settle, release, compromise, collect or otherwise liquidate Liabilities and any
security or collateral therefor in any manner, without affecting or impairing
the obligations of Guarantor hereunder. Secured Party shall have the exclusive
right to determine the time and manner of application of any payments or
credits, whether received from the Company or any other source, and such
determination shall be binding on Guarantor. All such payments and credits may
be applied, reversed and reapplied, in whole or in part, to any of the
Liabilities as Secured Party shall determine in its sole discretion without
affecting the validity or enforceability of this Guaranty.
 
6. To secure the payment and performance of the Liabilities, including the
obligations and liabilities contained herein, the Company has granted to Secured
Party a security interest in certain property of the Company pursuant to a
Security Agreement dated as of even date herewith among the Company and Secured
Party (the “Security Agreement”). Guarantor agrees that Secured Party shall have
the rights and remedies of a secured party under the UCC (as defined in the
Security Agreement), as now existing or hereafter amended, with respect to all
of the aforesaid property, including without limitation thereof, the right to
sell or otherwise dispose of any or all of such property and apply the proceeds
of such sale to the payment of Liabilities. In addition, Secured Party may, in
its sole discretion, without notice to Guarantor and regardless of the
acceptance of any security or collateral for the payment hereof, appropriate and
apply toward the payment of Liabilities (i) any indebtedness due or to become
due from Secured Party to Guarantor, and (ii) any moneys, credits or other
property belonging to Guarantor, at any time held by or coming into the
possession of Secured Party, whether for deposit or otherwise.
 
7. Guarantor hereby assumes responsibility for keeping itself informed of the
financial condition of the Company, and any and all endorsers and/or other
guarantors of any instrument or document evidencing all or any part of
Liabilities and of all other circumstances bearing upon the risk of nonpayment
of Liabilities or any part thereof that diligent inquiry would reveal, and
Guarantor hereby agrees that Secured Party shall not have any duty to advise
Guarantor of information known to Secured Party regarding such condition or any
such circumstances or to undertake any investigation not a part of its regular
business routine. If Secured Party, in its sole discretion, undertakes at any
time or from time to time to provide any such information to Guarantor, Secured
Party shall be under no obligation to update any such information or to provide
any such information to Guarantor on any subsequent occasion.
 
 
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8. Guarantor consents and agrees that Secured Party shall be under no obligation
to marshal any assets in favor of Guarantor or against or in payment of any or
all of Liabilities. Guarantor further agrees that, to the extent that the
Company make a payment or payments to Secured Party, or Secured Party receives
any proceeds of collateral, which payment or payments or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to the Company, its estate, trustee, receiver or
any other party, including, without limitation, Guarantor, under any bankruptcy
law, state, provincial or federal law, common law or equitable theory, then to
the extent of such payment or repayment, Liabilities or the part thereof which
has been paid, reduced or satisfied by such amount, and Guarantor’s obligations
hereunder with respect to such portion of Liabilities, shall be reinstated and
continued in full force and effect as of the date such initial payment,
reduction or satisfaction occurred.
 
9. Guarantor agrees that any and all claims of Guarantor against the Company,
any endorser or any other guarantor of all or any part of Liabilities, or
against the Company’s properties, whether arising by reason of any payment by
Guarantor to Secured Party pursuant to the provisions hereof, or otherwise,
shall be subordinate and subject in right of payment to the prior payment, in
full, of all of Liabilities.
 
10. Secured Party may, without notice to anyone, sell or assign Liabilities or
any part thereof, or grant participations therein, and in any such event each
and every immediate or remote assignee or holder of, or participant in, all or
any of Liabilities shall have the right to enforce this Guaranty, by suit or
otherwise for the benefit of such assignee, holder, or participant, as fully as
if herein by name specifically given such right, but Secured Party shall have an
unimpaired right, prior and superior to that of any such assignee, holder or
participant, to enforce this Guaranty for the benefit of Secured Party, as to
any part of Liabilities retained by Secured Party.
 
11. This Guaranty shall be binding upon Guarantor and upon the successors
(including without limitation, any receiver, trustee or debtor in possession of
or for Guarantor) of Guarantor and shall inure to the benefit of Secured Party
and its respective successors and assigns. Guarantor hereby represents and
warrants that it has all necessary corporate authority to execute and deliver
this Guaranty and to perform its obligations hereunder.
 
12. This Guaranty shall continue in full force and effect, and Secured Party
shall be entitled to make loans and advances and extend financial accommodations
to the Company on the faith hereof until such time as Secured Party has, in
writing, notified Guarantor that all of Liabilities have been paid in full and
discharged or until Secured Party has actually received written notice from
Guarantor of the discontinuance of this Guaranty, or written notice of the
dissolution of Guarantor. In case of any discontinuance by, or dissolution of,
Guarantor (collectively, a “Termination Event”), this Guaranty and the
obligations of Guarantor and its successors or assigns, as the case may be,
shall remain in full force and effect with respect to all of Liabilities
incurred prior to the receipt by Secured Party of written notice of the
Termination Event.
 
13. Wherever possible each provision of this Guaranty shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Guaranty shall be prohibited by or invalid under such law,
such provision shall be ineffective to the extent of such prohibition or
invalidity without invalidating the remainder of such provision or the remaining
provisions of this Guaranty.
 
 
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14. THIS GUARANTY SHALL BE GOVERNED AND CONTROLLED BY THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS, without regard to its conflicts of law
principles.
 
15. Guarantor irrevocably agrees that, subject to Secured Party’s sole and
absolute election, all disputes arising under this Guaranty will be submitted to
arbitration in Boston, Massachusetts before a single arbitrator of the American
Arbitration Association (“AAA”). The arbitrator shall be selected by application
of the rules of the AAA, or by mutual agreement of the parties, except that such
arbitrator shall be an attorney admitted to practice law in the Commonwealth of
Massachusetts. No party to this agreement will challenge the jurisdiction or
venue provisions as provided in this section. Nothing in this section shall
limit the Secured Party’s right to obtain an injunction for a breach of this
Guaranty from a court of law.
 
[Signature Page Follows]
 
 
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IN WITNESS WHEREOF, this Guaranty has been duly executed by the undersigned as
of this ____ day of August, 2007.

        GUARANTOR:       LOGISTICAL SUPPORT, LLC.  
   
   
    By:   /s/   

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Name: Bruce W. Littell  
Title: Chief Executive Order

 
 
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ACKNOWLEDGMENT OF SIGNATURES
 
STATE OF _________________
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SS
COUNTY OF _______________
}
 

I, ___________________________, a Notary Public in and for the state and county
aforesaid, so hereby certify that before me this day personally appeared
_______________________, known to me to be the same person whose name is
subscribed to the foregoing Continuing Unconditional Guaranty and known to me to
be the _____________________________ of the corporation that executed the
foregoing Continuing Unconditional Guaranty, and acknowledged to me that he
executed and delivered the foregoing consent as his free and voluntary act, for
the uses set forth therein.
 
IN WITNESS WHEREOF, I have hereunto set my hand and official seal this ______
day of August, 2007.
 

 
_________________________
Notary Public
 
My Commission Expires: ______

 
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