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November 29, 2005
VIA FACSIMILE and U.S. MAIL
T. Michael Daggett
Stinson Morrison Hecker LLP
1850 N. Central Avenue, Suite 2100
Phoenix, AZ 85004-4584
Re: Alanco Technologies, Inc. et al. v. Carolina Casualty Insurance Co.
Superior Court ofMaricopa County, CV 2004-00558l
Dear Mr. Daggett:
As you know, Carolina has a 30(b)(6) deposition scheduled for Wednesday, November
30, 2005, with respect to Plaintiffs’ damages in this case. We are also in receipt (without the
attachments) of your letter dated November 23, 2005 (the "Letter7’).] As we discussed by
telephone yesterday, with respect to the fourth paragraph of the Letter, we cannot agree that the
issuance of 162,000 shares of Alanco stock to Alfred Peepers (the "Peepers Stock") constitutes
"Costs of Defense" or "Loss" under the Policy. As such, we advised that this aspect of the
alleged damages must be withdrawn or we would need to proceed with the 30(b)(6) deposition.
As discussed yesterday, you noted that Plaintiffs will presently withdraw the alleged
damages related to the Peepers Stock, but you reserved the right to raise the same in the future.
We have agreed that if you do assert damages related to Peepers Stock in the future, Carolina
will be afforded the opportunity to conduct a 30(b)(6) deposition of Alanco respecting the
issuance of the Peepers Stock as damages.2
We have also included a proposed Stipulation with respect to the damages for your
consideration and execution.
I As of the time this letter was emailed, we still have not received the actual mailed
Letter with the attachments. .
~ 2 We have also agreed that Plaintiffs shall not ever make any motion to (quash or
otherwise limit this deposition, nor shall Plaintiffs ever attempt to bar or limit .any of the
testimony obtained in such a deposition based on the fact that we have agreed to extend this
deposition past the discovery date set forth in the Court’s Order.
29565@1ase 2:04-cv-00789-DGC Document 96-2 Filed O3/06/2006 Paget 0f2

` T. Michael Daggett, Esq. S S
J l 1/29/ 05
Page 2
Should this letter not reflect our agreement, please contact us immediately in writing.
Very truly yours,
WILSON, ELSER, OWI CKER LLP
es K. Thurston
Enclosure
cc: Mark Worischeck, Esq.
Daniel Tranen, Esq.
wirsow, erseiz, Mosxowirz, EDELMAN & oiciuaa rm _
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Case 2:04-cv-00789-DGC

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