Document:

Exhibit
10.1

 

SUMMARY
OF OFFICER COMPENSATION ARRANGEMENTS

 

The following table sets
forth the revised salary and bonus arrangements of certain “named executive
officers,” as defined in Item 402 of Regulation S-K, of Digirad Corporation
(the “Company”) for 2005.  The named executive officers of the Company
listed below are also eligible to receive option grants under the Company’s
2004 Stock Incentive Plan, at the discretion of, and on the terms approved by,
the board of directors.  The
determination of who constitutes a named executive officer is being made as of
March 14, 2005 and may subsequently change, depending on the amount of cash
bonuses awarded by the board of directors to the Company’s officers with
respect to services performed during the fiscal year.

 

	
   

  	
   

  	
   

  	
   

  	
  2005 Compensation

  
	
  Executive Officer

  	
   

  	
  Position

  	
   

  	
  Salary (1)

  	
   

  	
  Bonus

  
	
  David M. Sheehan

  	
   

  	
  President and Chief
  Executive Officer

  	
   

  	
  $

  	
  300,000

  	
   

  	
  (2)

  
	
  Vera P. Pardee

  	
   

  	
  Vice President, General
  Counsel and Secretary

  	
   

  	
  230,000

  	
   

  	
  (2)

  
	
  Todd P. Clyde

  	
   

  	
  Chief Financial Officer

  	
   

  	
  225,000

  	
   

  	
  (2)

  
	
  Herbert J. Bellucci

  	
   

  	
  Senior Vice President
  of Operations

  	
   

  	
  188,000

  	
   

  	
  (2)

  
								

 

(1)          Salaries
effective as of April 1, 2005.

 

(2)          The
aggregate bonus amount payable to the Company’s executive officers eligible to
receive such bonuses (the “Aggregate Bonus Amount”) in 2005 is equal to (i)
1.667% of each dollar of the Company’s revenue over $68.0 million plus (ii) 5%
of each dollar of the Company’s net income if total net income is above $1.0
million.  In the event, however, that
certain minimum revenue and net income thresholds are not met, no bonuses will
be paid.  Each executive officer eligible
to receive bonuses will be entitled to receive that portion of the Aggregate
Bonus Amount which is equal to the quotient obtained by dividing (i) such
executive officer’s base salary by (ii) the sum of all base salaries for the
Company’s executive officers eligible to receive bonuses.  The Company’s Chief Executive Officer will be
entitled to receive an increasingly greater bonus as the Company’s revenues
grow to certain thresholds over $86.0 million. 
The bonus amounts payable to each of the Company’s executive officers
may be reduced in the event that the individual goals for each such executive
officer are not achieved.  The bonus
amounts will be accrued quarterly and paid following the completion of the
Company’s 2005 audit.Exhibit 10.14

 

GUARANTY AGREEMENT

 

 

This Guaranty
is made by the undersigned (referred to as “Guarantors”, whether one or more)
for the benefit of INTERNATIONAL BANK OF COMMERCE, 130 E. Travis, San Antonio,
Bexar County, Texas 78205 (“Lender”), This Guaranty relates to the indebtedness
and other obligations described below of LANCER PARTNERSHIP, LTD., a Texas
limited partnership (“Borrower”), whether one or more. 

 

1. Guarantee. Guarantors, for good and
valuable consideration, the receipt of which is hereby acknowledged, do hereby
jointly and severally, unconditionally guarantee and promise to pay to Lender,
its successors and assigns, in currency which is legal tender in the United
States of America,

 

(a) the full, punctual and prompt payment of the Guaranteed
Indebtedness (defined below), together with interest thereon from the date such
indebtedness is due until paid at the rate of interest specified in the
promissory note(s) and/or other instruments or documents that evidence such
indebtedness, and

 

(b) the performance and discharge of the obligations of Borrower
specified and under any and all promissory notes, letters of credit, and all
other documents and instruments (the “Security Instruments”) executed by
Borrower and/or other parties in connection with the Guaranteed Indebtedness.
This Guaranty is an absolute and continuing unconditional guaranty of payment
and not of collectability.

 

2. Guaranteed Indebtedness. The term “Guaranteed Indebtedness”
shall mean all liabilities and obligations of Borrower (or any of them if more
than one) to Lender, whether immediate or remote, whether now existing or
hereafter created or arising, due or to become due, direct or indirect,
absolute or contingent, and whether joint, several, joint and several, as to
outstanding principal, accrued and unpaid interest, late charges, attorney’s
fees, collection costs and all other sums owing by Borrower (or any of them if
more than one) to Lender, including but not limited to:

 

(a) any
commercial loan or indebtedness; (b) any credit card or other consumer type of
loan; (c) any indebtedness relating to checking or savings accounts
(overdrafts, interest, fees, etc.); (d) any expenses incurred in the protection
or maintenance of the collateral securing any of such liabilities, loans, and
obligations; (e) any expenses incurred in the collection of any obligation of
the Borrower to Lender whether arising out of this Guaranty or otherwise; (f)
any letters of credit and/or indebtedness arising out of, or advanced to pay,
letters of credit transactions; (g) any indebtedness, however evidenced,
whether by promissory note, bookkeeping entry, electronic transfer, checks,
drafts or other items, or by any other manner or form; (h) any other
indebtedness of Borrower to any member Bank or branch Bank of International
BancShares Corporation, jointly and/or severally, and in any capacity, whether
as borrower, guarantor, or otherwise, now or hereafter owing, created and/or
arising, and regardless of how evidenced or arising; (i) any and all extensions,
modifications, substitutions and/or renewals of any of such indebtedness;
and/or (j) any of the foregoing that arises after the filing of a petition in
bankruptcy by or against Debtor under the Federal Bankruptcy Code, even if the
obligations do not accrue because of the automatic stay under Bankruptcy Code
362 or otherwise.

 

By execution
of this Guaranty, Guarantor expressly covenants that Guarantor understands that
this Guaranty will guarantee the obligation of all present and future
indebtedness of Borrower (and anyone of them if more than one) regardless of
the fact that said other indebtedness may be of a different c1ass and may have
been incurred for a different purpose and may be totally unrelated to the
purpose of the loan made or advanced at the time of the execution by Guarantors
of this Guaranty Agreement.

 

3. Guaranty Terms. This Guaranty is subject to the following
terms:

 

(a) Guarantors agree that Lender may renew, rearrange or extend from
time to time, the time, manner, place or terms of payment of the Guaranteed
Indebtedness or any renewals or extensions thereof without notice thereof to
Guarantors and Guarantors hereby consent to such action, and/or Lender may
supplement, change, amend, substitute, modify or alter the Guaranteed Indebtedness
and/or any present and future Security Instruments without in any way changing,
releasing or discharging Guarantors from liability and/or obligation hereunder;

 

(b) Guarantors agree that notice of acceptance of this Guaranty
Agreement by Lender is not expected or desired and Guarantors waive notice of
acceptance by Lender of this Guaranty Agreement and also waive demand for
overdue payments, notice of intention to accelerate and notice of actual
acceleration, presentment, demand for payment, protest and notice of protest,
nonpayment, default or dishonor of the Guaranteed Indebtedness or any renewal,
modification, or extension thereof; waive the obligation required by Section 34.02
of the Texas Business and Commerce Code (the “Code”) for Lender to sue on the
Guaranteed Indebtedness; the discharge provisions of §34.02(b) of the Code and
the provisions of §34.03 of the Code which require a levy of execution to be
made against the principal’s property first so that pursuant to this waiver,
levy can be made against the Guarantors’ property prior to or with Borrower’s
property;

 

1

 

(c) Lender has the right but not the obligation, at any time and from
time to time, without prejudice to any claim against Guarantors hereunder, and
without notice to Guarantors to: (i) exchange, release or surrender all or any
part of the properties, real or personal, (the “Collateral”) which secure
payment of the Guaranteed Indebtedness, (ii) sell all or part of the Collateral
in accordance with the terms and provisions of any security instrument and
become the purchaser thereof at any public sale of the same, (iii) settle or
compromise with the Borrower, or any other person primarily or secondarily
liable with the Borrower, the Guaranteed Indebtedness, in whole or in part, and
all renewals and extensions thereof, but without waiving Lender’s rights to any
and all deficiencies on said Guaranteed Indebtedness, if any, and (iv) perform
or attempt to perform, partially or fully, any or all of the obligations
guaranteed hereunder;

 

(d) No failure, omission or delay on the part of Lender in exercising
any rights hereunder or in taking any action to collect or enforce payment of
any obligations to which this Guaranty applies or in enforcing observance or
performance of any agreement, covenant, term or condition to be performed or
observed under the Security Instruments, either against the Borrower or any
other person primarily or secondarily liable with the Borrower, shall operate
as a waiver of any such right or in any manner prejudice the rights of Lender
against Guarantors;

 

(e) Guarantors waive any right to require Lender to first (i) proceed
against the Borrower or endorsers, (ii) proceed against, sell or exhaust any
collateral held by Lender for the payment of the Guaranteed Indebtedness, or
(iii) pursue any other remedy that Lender has or to which it may be entitled;

 

(f) Suit may be brought against the Guarantors and/or against any other
person or entity obligated on the Guaranteed Indebtedness, whether by separate
Guaranty Agreement, or otherwise, jointly and severally, and against anyone or
more of them, less than all, without impairing the rights of the Lender, its
successors or assigns, against the other Guarantors, and the Lender may compromise
with anyone of the Guarantors for such sum or sums as it may see fit and
release such of the Guarantors from all further liability to the Lender for
such indebtedness without impairing the right of the Lender to demand and
collect the balance of such Guaranteed Indebtedness from others of the
Guarantors not so released, but it is agreed among the Guarantors themselves,
however, that such compromise and release shall not impair the rights of the
Guarantors among themselves arid will not impair any of the Lender’s rights
against the Borrower to recover the Guaranteed Indebtedness to include the
Lender’s right, at its option, to proceed against the Borrower for a deficiency
judgment;

 

(g) The liability of Guarantors shall remain and continue in full force
and effect notwithstanding (i) the non-liability of the Borrower for any reason
whatsoever for the payment of the Guaranteed Indebtedness or any part thereof,
save and except actual payment of the Guaranteed Indebtedness, (ii) the
voluntary or involuntary liquidation, dissolution, sale of all or substantially
all of the property described in the Security Instruments for the benefit of
creditors, reorganization, arrangement, composition or readjustment of, or any
similar proceeding affecting Borrower or any of Borrower’s assets, (iii) the
total pr partial release of the Borrower from the observance of any of the
agreements, covenants, terms or conditions contained in the Security
Instruments by agreement of Lender and/or by operation of law, or (iv) any defenses
or rights of set-off or counterclaims which Borrower may have or assert;

 

(h) Until the Guaranteed Indebtedness has been paid in full to Lender,
Guarantors hereby (i) waive and release any right of subrogation Guarantors
have or to which Guarantors may be entitled (in and to the benefit of any
security which Lender may at any time hold in connection with the Guaranteed
Indebtedness); and (ii) expressly subordinate their rights to payment of any
indebtedness owing from Borrower to Guarantors whether now existing or arising
at any time in the future to the prior right of Lender to receive or require
payment in full of the Guaranteed Indebtedness including interest accruing on
the Guaranteed Indebtedness, after any petition is filed under the United States
Bankruptcy Code, which post-petition interest Guarantors agree shall remain a
claim that is prior and superior to any claim of Guarantors notwithstanding any
contrary practice, custom or ruling or proceedings under the United States
Bankruptcy Code, and Guarantors agree not to accept any payment or satisfaction
of any kind of any indebtedness of the Borrower to Guarantors. If Guarantors
should receive any such payment, satisfaction or security for any indebtedness
of the Borrower to Guarantors, Guarantors agree forthwith to deliver the same
to the Lender in the form received, endorsed or assigned as may be appropriate
for application on account of, or as security for, the Guaranteed Indebtedness
or performance by Guarantors hereunder and until so delivered, and/or agree to
hold the same for the Lender;

 

(i) Guarantors agree that this guaranty contract and all obligations
hereunder are payable and performable in Bexar County, Texas, that payment
hereunder is due in said county at the address of Lender. GUARANTORS AGREE
FURTHER THAT THIS GUARANTY AGREEMENT AND ALL RIGHTS, OBLIGATIONS AND
LIABILITIES ARISING HEREUNDER SHALL BE CONSTRUED ACCORDING TO THE LAWS OF THE
STATE OF TEXAS;

 

(j) Guarantors agree that the Lender may, without demand or notice of
any kind, at any time when any amount shall be due and payable hereunder by
Guarantors, appropriate and apply toward the payment of such amount, and in
such order of application as the Lender in its sole discretion may from time to
time elect, any property, balances, credits, deposits, accounts or monies of
Guarantors now or hereafter, for any purpose, in the possession or control of
the Lender or any member Bank or branch Bank of International BancShares
Corporation;

 

(k) In addition to all liens upon, and rights of set-off against, the
monies, securities; or other property of Guarantors given Lender by law,
Guarantors hereby grant to Lender a security interest in and a right of set-off
against all monies, securities, and other property (except to the extent prohibited
by applicable Federal and State laws) of Guarantors now or hereafter in the
possession of or on deposit with Lender or any member Bank or branch Bank of
International Bancshares Corporation, whether held in a general or special
account or deposit, or for safekeeping or otherwise. Every such security
interest and right of set-off may be exercised without demand upon or notice to
Guarantors. No security interest or right of set-off shall be deemed to have
been waived by any act or conduct on the part of the Lender, or any failure to
exercise such right of set-off or to enforce such security interest; or by any
delay in so doing. Every right of set-off and security interest shall continue
in full force and effect until such right of set-off or security interest is
specifically waived or released by an instrument in writing executed by Lender.
The foregoing is in addition to and not in lieu of any rights of set-off
allowed by law;

 

(l) Guarantors, whether one or more of them, may give to the Lender
written notice that those of Guarantors signing and giving such notice will not
be liable hereunder for any Guaranteed Indebtedness created, incurred or
arising after the giving of such notice,

 

2

 

BUT THE
OBLIGATIONS UNDER THIS GUARANTY OF THOSE GUARANTORS WHO SHALL NOT HAVE SIGNED
AND GIVEN SUCH NOTICE SHALL REMAIN AND CONTINUE WITHOUT DIMINUTION WHATSOEVER,
AS IF SUCH GUARANTORS HAD BEEN THE ONLY GUARANTORS SIGNING THIS INSTRUMENT, OR
OTHER GUARANTY AGREEMENT. HOWEVER, NO SUCH NOTICE SHALL LIMIT OR IMPAIR THE
OBLIGATIONS HEREUNDER OF ANY GUARANTORS BY WHOM SUCH NOTICE IS SIGNED AND GIVEN
WITH RESPECT TO ANY OF THE GUARANTEED INDEBTEDNESS WHICH WAS EXISTING PRIOR TO
AND ON THE DATE OF RECEIPT OF SUCH NOTICE BY THE LENDER. THE GUARANTORS SIGNING
AND GIVING SAID NOTICE SHALL CONTINUE TO BE LIABLE FOR PAYMENT OF THAT
GUARANTEED INDEBTEDNESS WHICH WAS EXISTING PRIOR TO AND ON THE DATE OF RECEIPT
BY LENDER OF SAID NOTICE INCLUDING ALL INTEREST TO ACCRUE AND REMAIN UNPAID THEREAFTER
ON THE GUARANTEED INDEBTEDNESS UNTIL THE GUARANTEED INDEBTEDNESS IS PAID IN
FULL. THE GUARANTEED INDEBTEDNESS MAY BE RENEWED, CONSOLIDATED, AND/OR
MODIFIED, FROM TIME TO TIME, AFTER RECEIPT BY LENDER OF SUCH NOTICE, WITHOUT
IMPAIRING OR LIMITING THE OBLIGATION OF GUARANTORS TO REPAY THE GUARANTEED
INDEBTEDNESS (WITH INTEREST AS IT ACCRUES AND REMAINS UNPAID). NOTWITHSTANDING
THE FOREGOING, NO SUCH NOTICE SHALL LIMIT OR IMPAIR THE OBLIGATIONS OF ANY
GUARANTORS FOR ANY LOSS TO LENDER RESULTING FROM ITEMS IN TRANSIT OR FROM
CURRENCY DEVALUATIONS ARISING AFTER RECEIPT OF SUCH NOTICE. THE NOTICE ABOVE
PROVIDED FOR SHALL NOT BE CONSIDERED AS GIVEN OR EFFECTIVE UNTIL ACTUALLY
RECEIVED AND ACKNOWLEDGED IN WRITING BY AN OFFICER OF SAID LENDER.
In the event of the death of any Guarantors hereunder, the obligation of the
deceased Guarantor shall continue in full force and effect against his/her
state as to all Guaranteed Indebtedness which shall have been created or
incurred by the Borrower prior to the time when the Lender shall have received
notice in writing of such death and this Guaranty shall from the date of such
death, as to all Guaranteed Indebtedness created, incurred or arising after
such death remain and continue in full force as a guaranty by the surviving
Guarantors. All Guaranteed Indebtedness, of whatever kind or character, created
pursuant to the provisions of any binding loan agreement between Lender and
Borrower entered into prior to receipt by Lender of any notice referred to
herein, including notice of death of any Guarantor, shall be deemed to be
Guaranteed Indebtedness created, incurred or arising prior to receipt of any
such notice to Lender even though advances constituting all or a portion of
such indebtedness be made subsequent to receipt of such notice by Lender;

 

(m) In the event the Borrower is a trust, corporation, joint stock
association, limited liability company, limited liability partnership or
partnership, or is hereafter incorporated, and if the Guaranteed Indebtedness
at any time hereafter exceeds the amount permitted by law, or said Borrower is
not liable because the act of creating the obligation is ultra vires, or the
officers or persons creating same acted in excess of their authority, then
notwithstanding such events, the individuals executing this Guaranty shall be
liable personally hereunder, notwithstanding that said trust, corporation,
joint stock association, limited liability company, limited liability
partnership or partnership is not liable under this Guaranty (or for the
payment of any portion of the Guaranteed Indebtedness), to the same extent as
such individuals would have been if the Guaranteed Indebtedness of said
Borrower had been enforceable against it;

 

(n) In the event any legal action or arbitration proceeding is
commenced in connection with the enforcement of or any declaration of rights
under this Guaranty and/or any instrument or written agreement required or
delivered under or pursuant to the terms of this Guaranty or the Guaranteed
Indebtedness, and/or any controversy or claim, whether sounding in contract,
tort or statute, legal or equitable, involving in any way the Guaranteed
indebtedness, or any other proposed or actual loan or extension of credit
involving Borrower, the prevailing party shall be entitled to recover
reasonable and necessary attorney’s fees, paralegal costs (including allocated
costs for in-house legal services), expert witness fees and costs, expenses and
costs and other necessary disbursements made in connection with any such action
or proceeding, in the amount determined by the fact-finder or arbitrator;

 

(o) If any of the following events occur or are continuing (and such
events continue beyond any applicable grace period provided in the Security
Instruments for the curing of such events):

 

(i)            The
default and failure of Borrower to Pay or perform the Guaranteed Indebtedness,
when due, in accordance with the terms, of the Security Instruments, which
default continues beyond any grace period provided in the Security Instruments
for the curing of such default; or

(ii)           If
Guarantors, or any of them, default in the performance or observance of any
agreement, covenant, term or condition contained herein; or

(iii)          If
Guarantors, or any of them, make a general assignment for the benefit of creditors;
or

(iv)          If
Guarantors, or any of them, petition or apply to any tribunal for the
appointment of a trustee or receiver of the business, estate or assets of any
substantial part of the business, estate or assets of Guarantors under any
bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation law of any jurisdiction, whether now or here after
in effect; or

(v)           If
any such petition or application is filed or any such proceedings are commenced
against Guarantors and Guarantors, or any of them, by any act indicate approval
thereof, consent thereto, or acquiescence therein, or an order is entered
appointing any such trustee or receiver, or adjudicating Guarantors bankrupt or
insolvent, or approving the petition in any such proceedings; or

(vi)          If
any other material change shall occur which causes Lender to deem itself to be
insecure in the payment or performance by Borrower of the Guaranteed
Indebtedness;

 

THEN, in any of such events, an event of default under the Guaranty
shall have occurred and Lender may, at its option, without notice of any kind,
declare the Guaranteed Indebtedness to be due and payable immediately, together
with the interest accrued thereon under the terms of the Security Instruments
and demand payment thereof by Borrower, Guarantors, or both of them and pursue
collection and enforcement in accordance with applicable law.

 

4. Compliance with Usury Laws. It is expressly, understood and
agreed that under no contingency or event whatsoever shall any amount be paid
by Guarantors hereunder, which is or may be determined to be interest, ever
exceed the maximum amount of interest which may be charged to Guarantors under
the laws of the State of Texas and the laws of the United States of America,
when and to the extent they preempt the laws of said state. In no event shall
the Guarantors, upon demand by the holder hereof for payment of the Guaranteed
Indebtedness, upon acceleration of the maturity of any promissory note
guaranteed by this Guaranty Agreement or otherwise, be obligated to pay
interest on excess of the amount permitted by law. If for any reason or
circumstance fulfillment of any provisions 

 

3

 

hereof, at any time performance of such provisions shall be due, and
shall involve receipt by Lender of interest in any amount which would exceed
the highest lawful rate to Guarantors, such amount which would be excessive
interest shall be applied to the reduction of the principal of the Guaranteed
Indebtedness and not to payment of interest.

 

5. Severability of Terms. In the event any of the provisions
contained in this Guaranty shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such provision shall not affect the validity
of any other terms or provisions hereof.

 

	
  6.

  	
   

  	
  ARBITRATION.

  

 

 

GUARANTORS
AND LENDER FURTHER AGREE AS FOLLOWS:

 

(a)           ANY
AND ALL CONTROVERSIES BETWEEN THE PARTIES, EXCEPT SUCH CLAIMS AND CONTROVERSIES
WHICH ARE CONSUMER RELATED AND INVOLVE AN AGGREGATE AMOUNT IN CONTROVERSY OF
LESS THAN TEN THOUSAND DOLLARS ($10,000.00), SHALL BE RESOLVED BY ARBITRATION
IN ACCORDANCE WITH THE COMMERCIAL ARBITRATION RULES OF THE AMERICAN ARBITRATION
ASSOCIATION IN EFFECT AT THE TIME OF FILING, UNLESS THE COMMERCIAL ARBITRATION
RULES CONFLICT WITH TIDS PROVISION, AND IN SUCH EVENT THE TERMS OF THIS
PROVISION SHALL CONTROL TO THE EXTENT OF THE CONFLICT. NOTWITHSTANDING ANYTHING
CONTAINED HEREIN TO THE CONTRARY, SAVE AND EXPECT SUBPARAGRAPHS (k), (m), (o),
(p), AND (8) HEREIN, THOSE CONSUMER RELATED CLAIMS AND CONTROVERSIES INVOLVING
AN AGGREGATE AMOUNT OF LESS THAN TEN THOUSAND DOLLARS ($10,000.00) SHALL BE
CONDUCTED IN ACCORDANCE WITH THE AMERICAN ARBITRATION ASSOCIATION RULES FOR THE
RESOLUTION OF CONSUMER-RELATED DISPUTES OF LESS THAN TEN THOUSAND DOLLARS. ANY
ARBITRATION HEREUNDER SHALL BE BEFORE AT LEAST THREE NEUTRAL ARBITRATORS
ASSOCIATED WITH THE AMERICAN ARBITRATION ASSOCIATION AND SELECTED IN ACCORDANCE
WITH THE COMMERCIAL ARBITRATION RULES OF THE AMERICAN ARBITRATION ASSOCIATION.
FAILURE OF ANY ARBITRATOR TO DISCLOSE ALL FACTS WHICH MIGHT TO AN OBJECTIVE
OBSERVER CREATE A REASONABLE IMPRESSION OF THE ARBITRATOR’S PARTIALITY, AND/OR
MATERIAL ERRORS OF LAW SHALL BE GROUNDS [IN ADDITION TO ALL OTHERS] FOR VACATUR
OF AN AWARD RENDERED PURSUANT TO THIS AGREEMENT. .

 

(b)           THE
AWARD OF THE ARBITRATORS, OR A MAJORITY OF THEM, SHALL BE FINAL, AND JUDGMENT
UPON THE AWARD RENDERED MAY BE ENTERED IN ANY COURT, STATE OR FEDERAL, HAVING
JURISDICTION. THE ARBITRATION AWARD SHALL BE IN WRITING AND SPECIFY THE FACTUAL
AND LEGAL BASES FOR THE AWARD. UPON THE REQUEST OF ANY PARTY, THE AWARD SHALL
INCLUDE FINDINGS OF FACT AND CONCLUSIONS OF LAW.

 

(c)           ARBITRABLE
DISPUTES INCLUDE ANY AND ALL CONTROVERSIES OR CLAIMS BETWEEN THE PARTIES OF
WHATEVER TYPE OR MANNER, INCLUDING WITHOUT LIMITATION; ANY CLAIM ARISING OUT OF
OR RELATING TO THIS AGREEMENT, ALL PAST, PRESENT AND/OR FUTURE CREDIT
FACILITIES AND/OR AGREEMENTS INVOLVING THE PARTIES, ANY TRANSACTIONS BETWEEN OR
INVOLVING THE PARTIES, AND/OR ANY ASPECT OF ANY PAST OR PRESENT RELATIONSHIP OF
THE PARTIES, WHETHER BANKING OR OTHERWISE, SPECIFICALLY INCLUDING ANY ALLEGED
TORT COMMITTED BY ANY PARTY.

 

(d)           THE
PARTIES SHALL ALLOW AND PARTICIPATE IN DISCOVERY IN ACCORDANCE WITH THE FEDERAL
RULES OF CIVIL PROCEDURE FOR A PERIOD OF ONE HUNDRED TWENTY (120) DAYS AFTER
THE FILING OF THE ORIGINAL RESPONSIVE PLEADING. DISCOVERY MAY CONTINUE
THEREAFTER AS AGREED BY THE PARTIES OR AS ALLOWED BY THE ARBITRATORS.
UNRESOLVED DISCOVERY DISPUTES SHALL BE BROUGHT TO THE ATTENTION OF THE
ARBITRATORS BY WRITTEN MOTION FOR PROPER DISPOSITION, INCLUDING RULING ON ANY
ASSERTED OBJECTIONS, PRIVILEGES, AND PROTECTIVE ORDER REQUESTS AND AWARDING
REASONABLE ATTORNEY’S FEES TO THE PREVAILING PARTY.

 

(e)           IN
THE EVENT THE AGGREGATE OF ALL AFFIRMATIVE CLAIMS ASSERTED EXCEED $500,000.00,
EXCLUSIVE OF INTEREST AND ATTORNEY’S FEES, OR UPON THE WRITTEN REQUEST OF ANY
PARTY, (1) PRIOR TO THE DISSEMINATION OF A LIST OF POTENTIAL ARBITRATORS, THE
AMERICAN ARBITRATION ASSOCIATION SHALL CONDUCT AN IN PERSON ADMINISTRATIVE
CONFERENCE WITH THE PARTIES AND THEIR ATTORNEYS FOR THE FOLLOWING PURPOSES AND
FOR SUCH ADDITIONAL PURPOSES AS THE PARTIES OR THE AMERICAN ARBITRATION
ASSOCIATION MAY DEEM APPROPRIATE, (A) TO OBTAIN ADDITIONAL INFORMATION ABOUT
THE NATURE AND MAGNITUDE OF THE DISPUTE AND THE ANTICIPATED LENGTH OF HEARINGS
AND SCHEDULING; (B) TO DISCUSS THE VIEW OF THE PARTIES ABOUT ANY TECHNICAL
AND/OR OTHER SPECIAL QUALIFICATIONS OF THE ARBITRATORS; AND (C) TO CONSIDER,
WHETHER MEDIATIQN OR OTHER METHODS OF DISPUTE RESOLUTION MIGHT BE APPROPRIATE,
AND (2) AS PROMPTLY AS PRACTICABLE AFTER THE SELECTION OF THE ARBITRATORS, A
PRELIMINARY HEARING SHALL BE HELD AMONG THE PARTIES, THEIR ATTORNEYS AND THE
ARBITRATORS WITH THE AGREEMENT OF THE ARBITRATORS AND THE PARTIES, THE
PRELIMINARY HEARING MAY BE CONDUCTED BY TELEPHONE CONFERENCE CALL RATHER THAN
IN PERSON. AT THE PRELIMINARY HEARING THE MATTERS THAT MAY BE CONSIDERED SHALL
INCLUDE, WITHOUT LIMITATION, A PREHEARING SCHEDULING ORDER ADDRESSING (A) EACH
PARTY’S DUTY TO SUBMIT A DETAILED STATEMENT OF CLAIMS, DAMAGES AND/OR DEFENSES,
A STATEMENT OF THE ISSUES ASSERTED BY EACH PARTY AND ANY LEGAL AUTHORITIES THE
PARTIES MAY WISH TO BRING TO THE ATTENTION OF THE ARBITRATORS; (B) RESPONSES
AND/OR REPLIES TO THE PLEADINGS FILED IN COMPLIANCE WITH SUBPART 2(A); (C)
STIPULATIONS REGARDING ANY UNCONTESTED FACTS; (D) EXCHANGE AND PREMARKING OF
ALL DOCUMENTS WHICH EACH PARTY

 

4

 

BELIEVES MAYBE OFFERED AT THE FINAL ARBITRATION HEARING; (E) THE
IDENTIFICATION AND AVAILABILITY OF WITNESSES, INCLUDING EXPERTS, AND SUCH
ADDITIONAL MATTERS REGARDING WITNESSES INCLUDING THEIR BIOGRAPHIES AND A SHORT
SUMMARY OF THEIR EXPECTED TESTIMONY, (F) WHETHER A STENOGRAPIC OR OTHER
OFFICIAL RECORD OF THE PROCEEDINGS SHALL BE MAINTAINED; AND (G) THE POSSIBILITY
OF UTILIZING MEDIATION OR OTHER ALTERNATIVE METHODS OF DISPUTE RESOLUTION.

 

(f)            FOR
PURPOSES OF THIS PROVISION, “THE PARTIES” MEANS GUARANTOR(S) AND LENDER, AND
EACH AND ALL PERSONS AND ENTITIES SIGNING THIS AGREEMENT OR ANY OTHER
AGREEMENTS BETWEEN OR AMONG ANY OF THE PARTIES AS PART OF THIS TRANSACTION. “THE
PARTIES” SHALL ALSO INCLUDE INDIVIDUAL PARTNERS, AFFILIATES, OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS AND/OR REPRESENTATIVES OF ANY PARTY TO SUCH
DOCUMENTS, AND SHALL INCLUDE ANY OTHER OWNER AND HOLDER OF THIS AGREEMENT.

 

(g)           THE
PARTIES SHALL HAVE THE RIGHT TO INVOKE SELF- HELP REMEDIES (SUCH AS SET-OFF,
NOTIFICATION OF ACCOUNT DEBTORS, SEIZURE AND/OR FORECLOSURE OF COLLATERAL, AND
NON-JUDICIAL SALE OF PERSONAL PROPERTY AND REAL PROPERTY COLLATERAL) BEFORE,
DURING OR AFTER ANY ARBITRATION AND/OR REQUEST ANCILLARY OR PROVISIONAL
JUDICIAL REMEDIES (SUCH AS GARNISHMENT, ATTACHMENT, SPECIFIC PERFORMANCE,
RECEIVER, INJUNCTION OR RESTRAINING ORDER, AND SEQUESTRATION) BEFORE OR AFTER
ANY ARBITRATION. THE PARTIES NEED NOT AWAIT THE OUTCOME OF THE ARBITRATION
BEFORE USING SELF-HELP REMEDIES. USE OF SELF-HELP OR ANCILLARY AND/OR
PROVISIONAL JUDICIAL REMEDIES SHALL NOT OPERATE AS A WAIVER OF EITHER PARTY’S
RIGHT TO COMPEL ARBITRATION. ANY ANCILLARY OR PROVISIONAL REMEDY WHICH WOULD BE
AVAILABLE FROM A COURT AT LAW SHALL BE AVAILABLE FROM THE ARBITRATORS.

 

(h)           THE
PARTIES AGREE THAT ANY ACTION REGARDING ANY CONTROVERSY BETWEEN THE PARTIES
SHALL EITHER BE BROUGHT BY ARBITRATION, AS DESCRIBED HEREIN, OR BY JUDICIAL
PROCEEDINGS, BUT SHALL NOT BE PURSUED SIMULTANEOUSLY IN DIFFERENT OR
ALTERNATIVE FORMS. A TIMELY WRITTEN NOTICE OF INTENT TO ARBITRATE PURSUANT TO
THIS AGREEMENT STAYS AND/OR ABATES ANY AND ALL ACTION IN A TRIAL COURT, SAVE
AND EXCEPT A HEARING ON A MOTION TO COMPEL ARBITRATION AND/OR THE ENTRY OF AN
ORDER COMPELLING ARBITRATION AND STAYING AND/OR ABATING THE LITIGATION PENDING
THE FILING OF THE FINAL AWARD OF THE ARBITRATORS. ALL REASONABLE AND NECESSARY
ATTORNEY’S FEES AND ALL TRAVEL COSTS SHALL BE AWARDED TO THE PREVAILING PARTY
ON ANY MOTION TO COMPEL ARBITRATION AND MUST BE PAID TO SUCH PARTY WITHIN TEN
(10) DAYS OF THE SIGNING OF THE ORDER COMPELLING ARBITRATION.

 

(i)            ANY
AGGRIEVED PARTY SHALL SERVE A WRITTEN NOTICE OF INTENT TO ARBITRATE TO ANY AND
ALL OPPOSING PARTIES WITHIN 360 DAYS AFTER DISPUTE HAS ARISEN. A DISPUTE IS
DEFINED TO HAVE ARISEN ONLY UPON RECEIPT OF SERVICE OF JUDICIAL PROCESS,
INCLUDING SERVICE OF A COUNTERCLAIM, FAILURE TO SERVE A WRITTEN NOTICE OF
INTENT TO ARBITRATE WITHIN THE TIME SPECIFIED ABOVE SHALL BE DEEMED A WAIVER OF
THE AGGRIEVED PARTY’S RIGHT TO COMPEL ARBITRATION OF SUCH CLAIM. THE ISSUE OF
WAIVER PURSUANT TO THIS AGREEMENT IS AN ARBITRABLE DISPUTE.

 

(j)            ACTIVE
PARTICIPATION IN PENDING LITIGATION DURING THE 360 DAY NOTICE PERIOD, WHETHER
AS PLAINTIFF OR DEFENDANT, IS NOT A WAIVER OF THE RIGHT TO COMPEL ARBITRATION.
ALL DISCOVERY OBTAINED IN THE PENDING LITIGATION MAY BE USED IN ANY SUBSEQUENT
ARBITRATION PROCEEDING.

 

(k)           THE
PARTIES FURTHER AGREE THAT (i) NO ARBITRATION PROCEEDING HEREUNDER SHALL BE
CERTIFIED AS A CLASS ACTION OR PROCEED AS A CLASS ACTION, OR ON A BASIS
INVOLVING CLAIMS BROUGHT IN A PURPORTED REPRESENTATIVE CAPACITY ON BEHALF OF THE
GENERAL PUBLIC OTHER CUSTOMERS OR POTENTIAL CUSTOMERS OR PERSONS SIMILARLY
SITUATED AND (ii) NO ARBITRATION PROCEEDING HEREUNDER SHALL BE CONSOLIDATED
WITH, OR JOINED IN ANY WAY WITH, ANY OTHER ARBITRATION PROCEEDING.

 

(l)            ANY
ARBITRATOR SELECTED SHALL BE KNOWLEDGEABLE IN THE SUBJECT MATTER OF THE
DISPUTE. EACH OF THE PARTIES SHALL PAY AN EQUAL SHARE OF THE ARBITRATION COSTS,
FEES, EXPENSES, AND OF THE ARBITRATORS’ FEES, COSTS AND EXPENSES.

 

(m)          ALL
STATUTES OF LIMITATIONS WHICH WOULD OTHERWISE BE APPLICABLE SHALL APPLY TO ANY
AND ALL CLAIMS ASSERTED IN ANY ARBITRATION PROCEEDING HEREUNDER AND THE
COMMENCEMENT OF ANY ARBITRATION PROCEEDING TOLLS SUCH STATUTES OF LIMITATIONS.

 

(n)           IN
ANY ARBITRATION PROCEEDING SUBJECT TO THIS PROVISION, THE ARBITRATORS, OR MAJORITY
OF THEM, ARE SPECIFICALLY EMPOWERED TO DECIDE (BY DOCUMENTS ONLY, OR WITH A
HEARING, AT THE ARBITRATORS’ SOLE DISCRETION) PREHEARING MOTIONS WHICH ARE
SUBSTANTIALLY SIMILAR TO PREHEARING MOTIONS TO DISMISS AND MOTIONS FOR SUMMARY
ADJUDICATION.

 

(o)           THIS
ARBITRATION PROVISION SHALL SURVIVE ANY TERMINATION, AMENDMENT, OR EXPIRATION
OF THE AGREEMENT IN WHICH THIS PROVISION IS CONTAINED, UNLESS ALL OF THE
PARTIES OTHERWISE EXPRESSLY AGREE IN WRITING.

 

5

 

(p)           THE
PARTIES ACKNOWLEDGE THAT THIS AGREEMENT EVIDENCES A TRANSACTION INVOLVING
INTERSTATE COMMERCE. THE FEDERAL ARBITRATION ACT SHALL GOVERN THE
INTERPRETATION, ENFORCEMENT, AND PROCEEDINGS PURSUANT TO THE ARBITRATION CLAUSE
OF THIS AGREEMENT.

 

(q)           THE
ARBITRATORS, OR A MAJORITY OF THEM, SHALL AWARD ATTORNEY’S FEES AND COSTS TO
THE PREVAILING PARTY PURSUANT TO THE TERMS OF THIS AGREEMENT.

 

(r)           NEITHER
THE PARTIES NOR THE ARBITRATORS MAY DISCLOSE THE EXISTENCE, CONTENT, OR RESULTS
OF ANY ARBITRATION HEREUNDER WITHOUT PRIOR WRITTEN CONSENT OF ALL PARTIES
AND/OR COURT ORDER.

 

(s)           VENUE
OF ANY ARBITRATION PROCEEDING HEREUNDER SHALL BE IN BEXAR COUNTY, TEXAS.

 

7. Lender and Guarantors hereby expressly acknowledge and agree that in
the event of a default under this Guaranty Agreement or under any document
executed by Borrower or Guarantors in connection with, or to secure the payment
of, Guaranteed Indebtedness (a) Lender shall not be required to comply with Subsection 3.05(d)
of the Texas Revised Partnership Act, and (b) Lender shall not be required to
proceed against or exhaust the assets of any Borrower and/or any Guarantor
before pursuing any remedy directly against one or more of the partners or
Borrower and/or Guarantor or the property of such partners.

 

8. Successors and Assigns. This Agreement shall be binding upon
Guarantors, the heirs, successors, assigns and legal representatives of the
Guarantors, and shall inure to the benefit of the Lender and the successors,
assigns and legal representatives of Lender. This guaranty shall inure to the
benefit of the transferee, assignee, or holder of the principal debt; however,
all Guaranteed Indebtedness owed to the Lender shall first be paid in full
before the assignee of any debt guaranteed shall receive any benefit of this
contract. All references herein to “Lender” shall mean the above named Lender
and any subsequent owner or holder of the Guaranteed Indebtedness or any
interest therein.

 

NO ORAL AGREEMENTS

 

THIS
WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEOUENT ORAL
AGREEMENT OF THE PARTIES.

 

THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

IN WITNESS
WHEREOF, Lender and Guarantor(s) have duly executed this Agreement to be
effective as of the date set forth above.

 

	
  “GUARANTOR”

  	
  LANCER INTERNATIONAL SALES, INC.,

  	
   

  	
  “GUARANTOR”

  
	
   

  	
  A Texas Corporation

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   /s/
  Scott Adams

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature of Guarantor

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
    Scott
  Adams

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature of Guarantor’s Spouse

  	
   

  
	
  Title:

  	
    Secretary

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Type or Print Name of Guarantor

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  “ADDRESS”

  	
   

  	
  “ADDRESS”

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  “GUARANTOR”

  	
   

  	
   

  	
  “GUARANTOR”

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Signature of Guarantor

  	
   

  	
   

  	
  Signature of Guarantor

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Signature of Guarantor’s Spouse

  	
   

  	
   

  	
  Signature of Guarantor’s Spouse

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Type or Print Name of Guarantor

  	
   

  	
   

  	
  Type or Print Name of Guarantor.

  	
   

  
										

 

6

 

 

	
  “ADDRESS”

  	
   

  	
   

  	
  “ADDRESS”

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

ACKNOWLEDGEMENT

 

 

	
  THE STATE OF TEXAS

  	
  §

  	
   

  	
   

  	
   

  
	
  COUNTY OF

  	
  Bexar

  	
   

  	
  §

  	
   

  	
   

  	
   

  
							

 

 

The foregoing instrument was acknowledged
before me on the              day
of December, 2004 by of Lancer International Sales, Inc., Texas corporation, on
behalf of said corporation

 

	
   

  	
   

  	
   

  	
  

  	
  

  
	
  THE STATE OF TEXAS

  	
   

  	
   

  	
  

  	
  SCOTT A: FARRIMOND

  
	
   

  
	
  Commission Expires 06-28-200B

  	
  §

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  COUNTY OF

  	
   

  	
   

  	
   

  	
   

  	
  §

  
								

 

ACKNOWLEDGEMENT

 

The foregoing instrument was acknowledged before me on the             
day of                         
,                
by                                                                                                                                                .

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Notary Public in and for

  	
   

  
	
   

  	
   

  	
   

  	
  The State of Texas

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Printed/Stamped Name

  	
   

  
	
   

  	
   

  	
   

  	
  My Commission Expires:

  	
   

  

 

 

	
  THE STATE OF TEXAS

  	
  §

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  COUNTY OF

  	
   

  	
   

  	
  §

  	
   

  	
   

  	
   

  
							

 

ACKNOWLEDGEMENT

 

The foregoing instrument was acknowledged before me on the
             day of
                        
,
               
by
                                                                                                                                               .

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Notary Public in and for

  	
   

  
	
   

  	
   

  	
   

  	
  The State of Texas

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Printed/Stamped Name

  	
   

  
	
   

  	
   

  	
   

  	
  My Commission Expires:

  	
   

  

 

7

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