Exhibit
2.6


STOCK
PURCHASE AGREEMENT




BY AND
AMONG




WHITBREAD
TECHNOLOGY PARTNERS, INC.




ZANETT,
INC.




and




JOEL
D’ARCY




Dated as
of March 1, 2005







STOCK
PURCHASE AGREEMENT




THIS
STOCK PURCHASE AGREEMENT (this “Agreement”) is entered into as of March 1, 2005,
by and among WHITBREAD TECHNOLOGY PARTNERS, INC., a Massachusetts corporation
(“Whitbread”), ZANETT, INC., a Delaware corporation (“Buyer”), and Joel D’Arcy,
an individual residing in the State of New Hampshire and owner of all of the
outstanding capital stock of Whitbread (the “Seller”).




W I T N E
S S E T H:




WHEREAS,
Whitbread is engaged in the business of providing information technology
consulting services.




WHEREAS,
the parties hereto desire to provide for the acquisition of Whitbread by the
Buyer through the sale by the Seller to Buyer of all the issued and outstanding
shares of capital stock of Whitbread, and for certain other matters, all on the
terms and subject to the conditions set forth in this Agreement.




WHEREAS,
the parties intend that the purchase and sale of the Shares be a taxable
transaction with an election made under Section 338(h)(10) of the Internal
Revenue Code of 1986, as amended.




NOW
THEREFORE, in consideration of the premises and the mutual representations,
warranties, covenants and agreements herein contained, the parties hereto,
intending to be legally bound, agree as follows:




ARTICLE
I.




DEFINITIONS
AND CONSTRUCTION




1.1           Definitions.




“Actual
Net Working Capital” shall mean (i) Current Assets including cash, minus (ii)
Current Liabilities, in each case as of the Closing Date and as recorded on the
Closing Financial Statements.




“Affiliate”
shall mean, as to any Person, any other Person controlled by, under the control
of, or under common control with, such Person.  As used in this
definition, “control” shall mean possession, directly or indirectly, of the
power to direct or cause the direction of management or policies (whether
through ownership of securities or partnership or other ownership interests, by
contract or otherwise).




“Baseline
EBITDA” shall have the meaning ascribed thereto in Section 3.1
hereof.




“Baseline
Revenue” shall mean $3,832,277.




“Benefit
Plans” shall mean any profit sharing, group insurance, medical, dental and/or
hospitalization, stock option, pension, retirement, bonus, deferred
compensation, stock bonus or stock purchase plan, or collective bargaining
agreements, contracts or other arrangements under which pensions, deferred
compensation or other retirement benefits are being paid or may become payable
by a party, or any other employee welfare or benefit agreements, plans or
arrangements, as defined in Section 3(3) of ERISA, any plan created in
accordance with Section 125 of the Code, or any nonqualified employee benefit
plans or deferred compensation, bonus, stock or incentive plans, or other
employee benefit or fringe benefit programs, established for the benefit of a
party’s former or current officers, directors or employees, including each trust
or other agreement with any custodian or any trustee for funds held under any
such agreement plan or agreement.




“Books
and Records” shall mean (i) the minute books containing the minutes of all
meetings and written consents of the shareholders and directors (and all
committees thereof) and (ii) all books and records of Whitbread prior to the
Closing Date, including customer lists, reports, plans, projections and
advertising and marketing materials and financial and accounting books and
records.




“Business”
shall mean the business currently carried on by Whitbread pursuant to which
Whitbread provides information technology consulting services.




1




“Business
Day” shall mean any day other than a Saturday, Sunday or legal holiday in the
State of New York.




“Buyer
Stock” shall mean the Buyer’s common stock, $0.001 par value per
share.




“Closing”
shall mean the exchange of the Shares for the Initial Cash Payment and Initial
Stock Payment as set forth herein.




“Closing
Balance Sheet” shall mean the balance sheet of Whitbread, dated as of the
Closing Date, included in the Closing Financial Statements.




“Closing
Date” shall mean the date on which the Closing is completed.




“Code”
shall mean the Internal Revenue Code of 1986, as amended.




“Contingent
Payments” shall mean the Contingent Cash Payment, the Contingent Stock Payment
and the Additional Contingent Payment.




“Current
Assets” shall mean, in respect of any period, all assets expected to be
converted into cash or otherwise realized in the twelve months following the
balance sheet date and recorded as current assets in the Financial Statements
and the Closing Financial Statements (as defined in Section 3.1 hereof) in
accordance with GAAP, including, but not limited to, cash and cash equivalents,
accounts receivable, notes receivable, interest receivable, prepaid expenses,
and current assets and any provisions recorded thereon.




“Current
Liabilities” shall mean, in respect of any period, all liabilities expected to
be settled in the twelve months following the balance sheet date and recorded as
current liabilities in Whitbread’s Financial Statements and the Closing
Financial Statements in accordance with GAAP, including, but not limited to,
accounts payable, accrued expenses, accrued payroll liabilities, interest
payable, deferred revenue and the current portion of any debt
obligations.




“DGCL”
shall mean the Delaware General Corporation Law, as amended.




“Disclosure
Documents” shall mean all agreements and documents referred to in any of the
Schedules, together with all other agreements and documents disclosed by
Whitbread to the Buyer during the Buyer’s due diligence investigation conducted
prior to the Closing Date which are attached hereto as ANNEX A.




“EBITDA”
means, for any period, earnings before (i) interest income and interest expense,
(ii) taxes based on income, and (iii) depreciation and amortization expense for
that period, calculated in accordance with Schedule A hereto.




“EBITDA
Target” means (i) for the first Performance Period, the product of (a) the
Baseline EBITDA and (b) 1.15, (ii) for the second Performance Period, the
product of (c) the Baseline EBITDA and (d) 1.3225, and (iii) for the third
Performance Period, the product of (e) the Baseline EBITDA and (b)
1.520875.




“Encumbrance”
shall mean a mortgage, charge, pledge, lien, option, restriction, claim, right
of first refusal, right of preemption, third party right or interest or other
encumbrance or security interest of any kind or similar right or any other
matter affecting title.




“Environmental
Laws” means all federal, state and local, provincial and foreign, civil and
criminal laws, regulations, rules, ordinances, codes, decrees, judgments,
directives or judicial or administrative orders, agreements or settlements
relating to pollution or protection of the environment, natural resources or
human health and safety, including, without limitation, laws relating to
releases or threatened releases of Hazardous Substances (including, without
limitation, releases or threatened releases to ambient air, surface water,
groundwater, land, surface and subsurface strata) or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, release,
transport, disposal or handling of Hazardous
Substances.  “Environmental Laws” include, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C.
9601 et seq.), the Hazardous Materials Transportation Law (49 U.S.C. 5101 et
seq.), the Resource Conservation and Recovery Act (42 U.S.C. 6901 et seq.), the
Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.), the Clean Air Act
(42 U.S.C. 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. 2601 et
seq.), the Oil Pollution Act (33 U.S.C. 2701 et seq.), the Emergency Planning
and Community Right-to-Know Act (42 U.S.C. 11001 et seq.), the Occupational
Safety and Health Act (29 U.S.C. 651 et seq.), each as amended to date and all
other state laws similar to any of the above.




2




“Environmental
Liabilities” means all liabilities of Whitbread that (i) arise under or relate
to violations of Environmental Laws or arise in connection with or related to
any matter disclosed or required to be disclosed on Schedule 4.19 and (ii) are
attributable to actions or omissions occurring or conditions existing on or
prior to the Closing Date.




“ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as
amended.




“Escrow
Agent” means the escrow agent that is a signatory to the Escrow
Agreement.




“Escrow
Agreement” means the Escrow Agreement by and among Buyer, Seller Agent and the
Escrow Agent, substantially in the form of Exhibit D hereto.




“Escrow
Shares” has the meaning set forth in Section 3.2(a)(v) hereof.




“Escrow
Value” has the meaning set forth in Section 3.2(a)(v) hereof.




“Excess
Cash” shall mean all cash and cash equivalents included on the Closing Balance
Sheet in excess of the Target Net Working Capital.




“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, together with
all rules and regulations promulgated thereunder.




“Financial
Statements” shall mean Whitbread’s balance sheets as of December 31, 2002, 2003
and 2004 and related statements of income, statements of change in shareholders’
equity and statements of cash flows for such years.




“GAAP”
shall mean, at any particular time, accounting principles generally accepted in
the United States of America, consistently applied on a going concern basis and,
with respect to interim financial statements, subject to normal year-end
adjustments.




“Hazardous
Substances” means:  (i) all Materials or Substances (whether or not
wastes, contaminants or pollutants) that are or become regulated by any of the
Environmental Laws; (ii) all Materials or Substances that are or become defined
or described by any of the Environmental Laws as “hazardous” or “toxic” or a
“pollutant,” “contaminant,” “hazardous substance,” “hazardous waste,” “extremely
hazardous waste,” “acutely hazardous waste” or “acute hazardous waste;” and
(iii) petroleum, including crude oil or any fraction thereof, asbestos,
including asbestos containing materials, and polychlorinated
biphenyls.




“Materials
or Substances” shall mean all elements, compounds, substances, matrices or
mixtures that are hazardous, toxic, ignitable, reactive or
corrosive.




“Net
Working Capital” shall mean (i) Current Assets minus (ii) Current Liabilities,
in each case as of the Closing Date and as recorded on the Closing Balance
Sheet.




“Performance
Period” shall mean each of the three successive 12 month periods commencing on
the first day of the month next following the month in which the Closing Date
occurs and ending on the date immediately preceding the anniversary
thereof.




3




“Performance
Period Financial Statements” shall mean the Annual Financial Statements and
Quarterly Financial Reports described in Section 8.4 hereof.




“Person”
shall mean an individual, company, partnership, limited liability company,
limited liability partnership, joint venture, trust or unincorporated
organization, joint stock corporation or other similar organization, government
or any political subdivision thereof, or any other legal entity.




“Receivables”
shall mean the accounts receivable, trade receivables, notes receivable and
other receivables arising out of or related to Whitbread’s operations, as of the
Closing Date, in each case determined in accordance with GAAP.




“Related
Agreements” shall mean all instruments, agreements and other documents executed
and delivered or to be executed and delivered pursuant to this Agreement
including without limitation the Ownership and Nondisclosure Agreements, the
Employment Agreements, the Escrow Agreement and the Lock-up
Agreements.




“Reserves”
shall mean those reserves for bad debts, contractual adjustments and
disallowances, self-insured risks, risk management and unspecified uninsured
liabilities, established and maintained by Whitbread and reflected in the
Financial Statements.




“Revenue
Target” means (i) for the first Performance Period, the product of (a) the
Baseline Revenue and (b) 1.15, (ii) for the second Performance Period, the
product of (c) the Baseline Revenue and (d) 1.3225, and (iii) for the third
Performance Period, the product of (e) the Baseline Revenue and (b)
1.520875.




“Schedules”
shall mean the disclosure schedules delivered by Whitbread to the Buyer pursuant
to this Agreement.




“Shares”
shall mean all issued and outstanding shares of Whitbread’s common stock, no par
value.




“Target
Net Working Capital” shall mean Net Working Capital equal to
$350,000.




“Taxes”
shall mean all taxes, assessments, charges, duties, fees, levies or other
governmental charges, including but not limited to, all federal, state local,
foreign or other income, profits, unitary, business, franchise, capital stock,
real property, personal property, intangible taxes, withholding, FICA, Medicare,
unemployment compensation, disability, transfer, sales, use, excise and other
taxes, assessments, charges, duties, fees, or levies of any kind whatsoever
(whether or not requiring the filing of Tax Returns) and all deficiency
assessments, additions to tax, penalties and interest.




“Tax
Returns” shall mean any return, amended return or other report (including but
not limited to elections, declarations, disclosures, schedules, estimates and
information returns) required to be filed with any taxing or governmental
authority.




1.2           Construction.




(a)           The
headings and captions used herein are intended for convenience of reference
only, and shall not modify or affect in any manner the meaning or interpretation
of any of the provisions of this Agreement.




(b)           As
used herein, the singular shall include the plural, the masculine and feminine
genders shall include the neuter, and the neuter gender shall include the
masculine and feminine, unless the context otherwise requires.




(c)           The
words “hereof”, “herein”, and “hereunder”, and words of similar import, when
used in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement.




4




(d)           All
references herein to Sections, Schedules or Exhibits shall be deemed to refer to
Sections of and Schedules or Exhibits to this Agreement, unless specified to the
contrary.  All Exhibits and Schedules to this Agreement are integral
parts of this Agreement as if fully set forth herein.




(e)           The
words “include,” “includes” and “including” when used herein shall be deemed in
each case to be followed by the words “without limitation.”




(f)           “To
the knowledge of Whitbread”, “to the best knowledge, information and belief of
Whitbread” or any similar phrase shall be deemed to mean that a Whitbread
Responsible Person (i) is actually aware of a particular fact or matter or (ii)
could be expected to discover or otherwise become aware of that fact or matter
had they made reasonable inquiry of appropriate employees and agents of the
Company or other appropriate third parties, as the case may be, with respect to
the matter in question.  For purposes of this definition, the term
Whitbread Responsible Person consists of all directors and executive officers of
Whitbread, including each of Joel D’Arcy and John Schmottlach.




(g)           “Material
adverse change” or “material adverse effect” means, with respect to a specified
party, any change or effect, as the case may be, that has, or is reasonably
likely to have, individually or in the aggregate, a material adverse impact on
the assets, business, prospects or financial position of such party and its
subsidiaries taken as a whole.




(h)           As
all parties participated in negotiating and drafting this Agreement, no rule of
construction shall apply to this Agreement which construes ambiguous language in
favor of or against any party by reason of that party’s role in drafting this
Agreement.




ARTICLE
II.




PURCHASE
AND SALE OF STOCK




2.1           Purchase
and Sale of Stock.  Subject to the terms and conditions of this
Agreement, at the Closing (as defined herein), the Seller shall sell, transfer
and deliver to the Buyer, and the Buyer shall purchase for the consideration set
forth in Article III hereof, free and clear of all Encumbrances, all of the
issued and outstanding Shares of Whitbread, which Shares constitute all of the
issued and outstanding capital stock of Whitbread.




2.2           Closing.  Subject
to the terms and conditions hereof, the closing of the transactions contemplated
by this Agreement (the “Closing”) will take place on the first business day
after the satisfaction or waiver of the conditions set forth in Article IX
(other than any such conditions that by their terms cannot be satisfied until
the Closing Date, which conditions shall be required to be so satisfied or
waived on the Closing Date), unless another time or date is agreed to in writing
by the parties hereto (the actual time and date of the Closing, the “Closing
Date”).  The Closing shall be held at the offices of Drinker Biddle
& Reath LLP, One Logan Square, 18th and
Cherry Streets, Philadelphia,  PA 19103-6996 fax:  (215)
988-2757, or at such other place as the parties hereto may agree.




2.3           Deliveries
at the Closing  At the Closing, in addition to the other actions
contemplated elsewhere herein:




(a)           the
Seller shall deliver, or shall cause to be delivered, to the Buyer the
following:




(i)           certificates
representing the Shares, duly endorsed for transfer or with stock powers affixed
thereto executed in blank in proper form for transfer;




(ii)           a
duly executed Section 338 Form from the Seller; and




(iii)           such
other documents and instruments as the Buyer may reasonably request to
effectuate or evidence the transactions contemplated by this
Agreement.




(b)           the
Seller shall cause Whitbread to deliver to the Buyer such documents and
instruments as the Buyer may reasonably request to effectuate or evidence the
transactions contemplated by this Agreement.




5




(c)           Buyer
shall deliver, or shall cause to be delivered, to the Seller a duly executed
Section 338 Form from the Buyer.




ARTICLE
III.




THE
PURCHASE PRICE




3.1           Determination
of Baseline EBITDA After Closing.  As promptly as practicable after
the Closing Date, but in no event more than seventy-five (75) days following
such Closing Date, Deloitte & Touche LLP shall, at Buyer’s sole expense,
prepare and deliver to the Buyer, Seller and Whitbread audited balance sheets as
of December 31, 2003, December 31, 2004 and as of the Closing Date, and related
statements of income, statements of change in shareholders’ equity and
statements of cash flows for such periods (including the interim period between
January 1, 2005 and the Closing Date), each prepared in accordance with GAAP, as
applied in a manner consistent with past practices of Whitbread (“Closing
Financial Statements”) to determine the EBITDA of Whitbread for the year ended
December 31, 2004 (“Baseline EBITDA”) and the Actual Net Working Capital of
Whitbread.  The date upon which the Closing Financial Statements are
delivered shall be known as the “EBITDA Determination Date.”  Upon
reasonable notice from Seller, Buyer will make available to Seller and its
representatives all books, records, personnel, including auditors work papers,
used in connection with the Baseline EBITDA determination.  In the
event that Seller has any dispute relating to the Baseline EBITDA or the
determination of Actual Net Working Capital, the provisions of Section 8.5 shall
apply.




3.2           Purchase
Price.




(a)           The
“Purchase Price” for the Shares, up to an aggregate of $4,124,500, shall consist
of:




(i)           an
amount of cash equal to $1,632,000, all of which shall be payable to the Seller
at the Closing in accordance with Section 3.3(a) (the “Initial Cash
Payment”);




(ii)           in
respect of each of the Performance Periods, an amount of cash up to $238,000,
payable to the Seller after the Closing in accordance with Section 3.3(c) (each
such payment,  a “Contingent Cash Payment”;




(iii)           a
number of shares of Buyer Stock calculated by dividing $578,000 by the average
closing price of a share of Buyer Stock as reported on NASDAQ for the fifteen
(15) consecutive trading days ending on the day prior to the Closing Date or the
closing price the day prior to Closing Date, whichever is the lower price per
share, such shares to be issuable to the Seller in accordance with Section
3.3(b) (the “Initial Stock Payment”);




(iv)           in
respect of each of the Performance Periods, a number of shares of Buyer Stock
calculated by dividing up to $238,000 by the average closing price of a share of
Buyer Stock as reported on NASDAQ for the fifteen (15) consecutive trading days
ending on the day prior to the Closing Date, such shares to be issuable to the
Seller after the Closing in accordance with Section 3.3(d) (the “Contingent
Stock Payment”);




(v)           a
number of shares of Buyer Stock calculated by dividing $102,000 (the “Escrow
Value”) by the average closing price of a share of Buyer Stock as reported on
NASDAQ for the fifteen (15) consecutive trading days ending on the day prior to
the Closing Date or the closing price the day prior to Closing Date, whichever
is the lower price per share, which shares shall be deposited into escrow to be
held and distributed in accordance with the terms and conditions of the Escrow
Agreement (the “Escrow Shares”); and




(vi)           an
amount of cash equal to $241,500, and a number of shares of Buyer Stock
calculated by dividing $143,000 by the average closing price of a share of Buyer
Stock as reported on NASDAQ for fifteen (15) consecutive trading days ending on
the day prior to the first anniversary date of the Closing Date, all of which
cash and Buyer Stock shall be payable and issuable to the Seller on the fourth
anniversary date of the Closing Date (the “Final Cash and Stock
Payment”).




In
connection with all stock issuances hereunder, the Buyer shall not be required
to issue any fractional shares or scrip.  All fractional shares shall
be rounded up to the nearest whole number of shares of Buyer Stock.




6




3.3           Payment
of Purchase Price.




(a)           Initial
Cash Payment.  At the Closing, upon surrender to the Buyer of
certificates representing all and not less than all of the Shares, the Buyer
shall pay the Seller the Initial Cash Payment.  The Initial Cash
Payment will be payable by means of wire transfer to an account specified in
writing to the Buyer by the Seller not less than five Business Days before the
Closing Date.




(b)           Initial
Stock Payment.  Within 30 days after the Closing, the Buyer shall
issue and deliver to the Seller a certificate, registered in the name of the
Seller, representing a number of shares of Buyer Stock equal to the Initial
Stock Payment.




(c)           Contingent
Cash Payment.  In respect of each Performance Period, within thirty
(30) days following complete satisfaction of the Performance Period Requirements
set forth below, the Buyer shall pay the Seller an amount in cash equal to the
Contingent Cash Payment.




With
respect to each Performance Period, the requirements set forth in paragraphs 1-3
below (the “Performance Period Requirements”) must be satisfied as a condition
precedent to the Buyers obligation to pay the Contingent Cash Payment for such
Performance Periods:




1.           During
each Performance Period, the EBITDA of Whitbread must be equal to or exceed that
Performance Period’s EBITDA Target; and




2.           During
each Performance Period, the revenue of Whitbread must be equal to or exceed
that Performance Period’s Revenue Target; and




3.           The
Seller shall be in compliance with the Non-Competition Agreement (as defined in
Section 9.2(g) of this Agreement).  For purposes of this Section
3.3(c), any attempt by the Seller to have the Non-Competition Agreement deemed
void or unenforceable by a court of law or equity shall be deemed to be a
violation of the Performance Period Requirements.




(d)           Contingent
Stock Payment.  Within thirty (30) days following complete
satisfaction of the Performance Period Requirements as set forth above, for each
Performance Period,  the Buyer shall deliver to the Seller a
certificate representing a number of shares of Buyer Stock calculated by
dividing $238,000 by the average closing price of a share of Buyer Stock as
reported on NASDAQ for the fifteen (15) consecutive trading days ending on the
day prior to the last day of the applicable Performance Period.  With
respect to each Performance Period, the Performance Period Requirements must be
satisfied as a condition precedent to the Buyer’s obligation to issue and
deliver the Contingent Stock Payment for such Performance Period.




(e)           Contingent
Payment Acceleration.  In the event that, in either the first or
second Performance Period, Whitbread (i) reports either annual revenue or
EBITDA, whichever the lesser, which exceeds 115% of the previous year’s revenue
or EBITDA, then contingent payment shall consist of the Contingent Cash Payment
and the Contingent Stock Payment for that Performance Period
(i.e.  $576,000 value) PLUS an additional amount calculated based on
the following formula (the “Additional Contingent Payment”):




CP = ((X
- 15)/15) * 142,800




Where




CP   =
  the Additional Contingent Payment to the Seller, half of which shall
be in cash and half of which shall be in Buyer Stock;




X    =
  the amount of percentage increase in annual revenue or EBITDA,
whichever is less.




7




The
maximum Additional Contingent Payment in any given year shall not exceed
$142,800, and the total Contingent Cash Payments and Contingent Stock Payments
payable to the Seller hereunder for all Performance Periods shall not exceed, in
the aggregate, $1,428,000 (the “Contingent Payment Cap”).




(f)           Rollover
EBITDA and Revenue.  In the event that Whitbread (i) reports less than
the EBITDA Target and/or the Revenue Target in a given Performance Period, then,
within 30 days after the end of the next measurement quarter following the end
of such Performance Period (the “NMQ”), the Seller may prepare and deliver to
the Buyer a statement (a “Catch-up Statement”) that recalculates the Contingent
Cash Payment and Contingent Stock Payment for such Performance Period using a
specified amount of EBITDA and/or revenue, as applicable, from the
NMQ.  Within thirty days after receiving a Catch-up Statement, the
Buyer shall pay the Contingent Cash Payment and shall issue the Buyer Stock
representing the Contingent Stock Payment using the average closing price of a
share of Buyer Stock as reported on NASDAQ for the fifteen (15) consecutive
trading days ending on the day prior to the date of such
issuance.  Any amount of EBITDA and/or revenue, as applicable, that is
borrowed from a NMQ and used in connection with a Catch-up Statement shall, for
purposes of this Section 3.3, irrevocably be deducted from the EBITDA and/or
revenue, as applicable, for the Performance Period in which it actually
occurs.  In the event that Whitbread generates for the three
Performance Periods taken as a whole a combined EBITDA and a combined revenue
equal to or higher than the sum of the three Performance Period’s EBITDA Targets
and Revenue Targets, then within 30 days after the later of (i) the end of the
third Performance Period or (ii) the receipt of an appropriate Catch-up
Statement from the Seller, the Buyer shall pay the Contingent Cash Payment and
issue the Buyer Stock representing the Contingent Stock Payment for any
Performance Periods in which such Contingent Cash Payment and Contingent Stock
Payment was not made.




(g)           Final
Cash and Stock Payment.  Buyer shall pay and deliver to Seller, on the
fourth anniversary date of the Closing Date, the Final Cash and Stock Payment,
which shall be paid within 30 days of said fourth anniversary.




(h)           Escrow
Shares.  Subject to the terms and conditions of the Escrow Agreement,
if the Baseline EBITDA is less than $1,000,000, then there shall be released
from escrow to the Buyer such number of shares of Buyer Stock equal to the
dollar amount of such shortfall divided by the average closing price of a share
of Buyer Stock as reported on NASDAQ for the fifteen (15) consecutive trading
days ending on the day prior to the Closing Date or the closing price the day
prior to Closing Date, whichever is the lower price per share; provided,
however, that  Seller’s entire liability with respect to any such
shortfall shall be limited to the release of Escrow Shares to Buyer hereunder,
and the number of shares of Buyer Stock to be released to Buyer hereunder, shall
not, in any event, when taken together with any Escrow Shares to be released to
Buyer under Section 3.4, exceed the Escrow Value.




(i)           Bankruptcy;
Liquidity Event.  After the Closing Date, if:




(i)           the
Buyer files for bankruptcy, or discontinues or ceases its business operations,
Buyer shall, within thirty (30) days of such cessation of business, pay to the
Seller, the Final Cash and Stock Payment together with an amount equal to the
difference between the Contingent Payment Cap and the aggregate amount of
Contingent Cash Payment and Contingent Stock Payments received by the Seller as
of the date of cessation of business; and




(ii)           the
Buyer sells all or substantially all of its assets or the assets of Whitbread,
all or substantially all of its stock or the stock of Whitbread, or its business
or the business of Whitbread, through sale, merger or consolidation or other
similar transaction, in each case to a Person not an Affiliate of the Buyer
(i.e.  arm’s length transaction), (collectively, a “Liquidity Event”),
then immediately upon the consummation of such Liquidity Event, the Buyer and
the Seller will, in good faith, either negotiate an adjustment to the Contingent
Cash Payments and Contingent Stock Payments (which shall depend upon whether the
buyer of the business has agreed to assume those obligations) or if an
adjustment cannot be agreed upon, then the Buyer shall pay to the Seller the
Final Cash and Stock Payment together with an amount equal to the difference
between the Contingent Payment Cap and the aggregate amount of Contingent Cash
Payments and Contingent Stock Payments received by the Seller as of the date of
the Liquidity Event.




8




(j)           Taxes.  All
Taxes incurred in connection with this Agreement, the Related Agreements and the
transactions contemplated hereby and thereby shall be paid by Whitbread,
excluding any such Taxes incurred by Seller.  The Seller shall prepare
or cause to be prepared, at his sole expense, and file or cause to be filed, and
pay or cause to be paid, all Tax Returns for Whitbread for all periods prior to
the Closing Date which are filed after the Closing Date.  The Seller
shall permit the Buyer to review and comment on each such Tax Return described
in the preceding sentence.  All Tax sharing agreements or similar
agreements with respect to or involving Whitbread shall be terminated as of the
Closing Date and, after the Closing Date, Whitbread shall not be bound thereby
or have any liability thereunder.




3.4           Working
Capital Adjustment.




(a)           In
connection with the delivery of the Closing Financial Statements, Buyer shall
deliver a calculation of Actual Net Working Capital.  Upon reasonable
notice from the Seller, Buyer will make available to the Seller and its
representatives all books, records, personnel, including auditors work papers,
used in connection with the Actual Net Working Capital
determination.




(b)           If
the Actual Net Working Capital is equal to the Target Net Working Capital, then,
subject to the terms and conditions of the Escrow Agreement, any Escrow Shares
that remain in escrow following any required release of Escrow Shares to Buyer
pursuant to Section 3.3(h) hereof shall be released from escrow to the
Seller.




(c)           If
the Actual Net Working Capital is less than the Target Net Working Capital, then
there shall be released from escrow to the Buyer such number of shares of Buyer
Stock equal to the dollar amount of such shortfall divided by the average
closing price of a share of Buyer Stock as reported on NASDAQ for the fifteen
(15) consecutive trading days ending on the day prior to the Closing Date or the
closing price the day prior to Closing Date, whichever is the lower price per
share; provided, however, that Seller’s entire liability with respect to any
such shortfall shall be limited to the release of Escrow Shares to Buyer
hereunder, and the number of shares of Buyer Stock to be released to Buyer
hereunder, shall not, in any event, when taken together with any Escrow Shares
to be released to Buyer under Section 3.3 (h), exceed the Escrow
Value.  Any Escrow Shares that remain in escrow following any required
release of Escrow Shares to Buyer pursuant to this Section 3.4(c) and Section
3.3(h) hereof shall be released from escrow to the Seller.




(d)           If
the Actual Net Working Capital is greater than the Target Net Working Capital,
then:




(i)           any
Escrow Shares that remain in escrow following any required release of Escrow
Shares to Buyer pursuant to Section 3.3(h) hereof shall be released from escrow
to the Seller; and




(ii)           seventy-five
(75) days after the Closing Date, Buyer shall pay such excess to the Seller by
releasing to the Seller Excess Cash in the amount of such excess; provided that
if the amount of such excess is greater than the Excess Cash, then in addition
to the Excess Cash, Buyer shall also remit to Seller amounts then collected with
respect to Receivables and shall continue to so remit such collected amounts to
Seller every 30 days thereafter until the balance of such excess shall have been
paid to the Seller in full.  Buyer shall use commercially reasonable
efforts to collect the Receivables in a manner consistent with Whitbread’s
practices over the 14 months prior to the Closing Date.  Until such
time as the Seller has received the excess of Actual Net Working Capital over
Target Net Working Capital, Buyer shall in no way modify, cancel, forgive or
settle any of the Receivables without first obtaining Seller’s prior written
consent, which consent shall not be unreasonably withheld.




3.5           If
the Closing Financial Statements are not delivered to Seller within ninety (90)
days of the Closing then all Escrow Shares shall be immediately released to
Seller.




9




ARTICLE
IV.




REPRESENTATIONS
AND WARRANTIES REGARDING WHITBREAD




As a
material inducement for the Buyer to enter into this Agreement and to consummate
the transactions contemplated hereby, Whitbread and the Seller hereby jointly
and severally make the following representations and warranties as of the date
hereof, each of which is relied upon by the Buyer regardless of any
investigation made or information obtained by or on behalf the
Buyer:




4.1           Organization;
Qualification and Capital Stock; Corporate Records.




(a)           Whitbread
is a corporation duly organized, validly existing and in good standing under the
laws of the Commonwealth of Massachusetts, and has the corporate power to own
all of its property and assets, to incur all of its liabilities and to carry on
its Business as now being conducted.




(b)           Whitbread
is duly qualified to do business and in good standing in each jurisdiction in
which the nature or conduct of the Business or the character or location of its
properties makes such qualification necessary, except where any such failure to
be qualified would not have a material adverse effect on Whitbread.




(c)           The
names of the directors and officers of Whitbread, together with the offices they
hold, are set forth on Schedule 4.1(c).  Attached to Schedule 4.1(c)
are true and complete copies of (i) the Articles of Organization of Whitbread,
together with all amendments thereto and (ii) the by-laws of Whitbread, together
with all amendments thereto, as currently in effect.




(d)           The
authorized capital stock of Whitbread consists of 200,000 shares of common
stock, no par value, of which 200 shares are duly and validly issued and
outstanding, are fully paid and non-assessable.  Other than the
Shares, since its date of incorporation, Whitbread has not issued any shares of
its capital stock, nor has Whitbread effected any stock split or otherwise
changed its capitalization.




(e)           None
of the outstanding shares of Whitbread’s capital stock has been issued in
violation of any preemptive rights of the current or past shareholders of
Whitbread, or any stock purchase agreement or other agreement to which Whitbread
was or is a party or bound.




(f)           Except
for options to purchase  shares of Whitbread’s common stock granted to
certain employees of Whitbread, each of which shall be cancelled prior to
Closing pursuant to Waiver, Acknowledgment, Release and Termination Agreements
substantially in the form provided on Exhibit E (the “Option Waivers”), there
are no issued or outstanding options, warrants, rights to subscribe for, calls,
or commitments of any character whatsoever relating to, or securities or rights
convertible into or exchangeable for, shares of the capital stock of Whitbread,
or contracts, commitments, understandings or arrangements by which Whitbread is
or may be obligated to issue additional shares of its capital stock or options,
warrants or rights to purchase or acquire any additional shares of its capital
stock.




(g)           Except
as set forth on Schedule 4.1(g), since January 1, 2004, Whitbread has not (i)
paid any dividend to any of its equity owners, (ii) made any other distribution
on or with respect to, or redeemed or otherwise acquired, any equity interest in
Whitbread, (iii) made or permitted any change in the authorized, issued, or
treasury shares of its equity securities, or (iv) taken any action which, if
taken after the date of this Agreement, would require the prior written consent
of the Buyer pursuant to this Agreement.  There is no liability for
dividends declared or accumulated but unpaid with respect to any of the
Shares.




(h)           Whitbread
has not made any non-cash distributions to any holders of Shares or participated
in or effected any issuance, exchange or retirement of Shares, or otherwise
changed the equity interests of holders of Shares in contemplation of effecting
the transactions contemplated by this Agreement and the Related Agreements
within the one year immediately preceding the date of this
Agreement




(i)           Except
as set forth on Schedule 4.1(i), Whitbread has not conducted business under any
name other than its own.  Schedule 4.1(i) includes a list of all of
Whitbread’s fictitious name registrations.




10




(j)           Subject
to the satisfaction of the conditions precedent set forth herein, Whitbread has
the corporate power to execute, deliver and perform this Agreement and the
Related Agreements to which Whitbread is a party, and, subject to the
satisfaction of the conditions precedent set forth herein, has taken all action
required by its Articles of Organization, by-laws or otherwise, to authorize the
execution, delivery and performance of this Agreement and the Related
Agreements.  The execution and delivery of this Agreement has been
approved by the Board of Directors of Whitbread.  Assuming this
Agreement constitutes the valid and binding agreement of Buyer, this Agreement
is a valid obligation of Whitbread, legally binding upon it and enforceable in
accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors’ rights and
remedies generally and subject, as to enforceability, to general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity), including those limiting the availability of specific
performance, injunctive relief and other equitable remedies and those providing
for equitable defenses (collectively, the “Enforceability
Limitations”).




(k)           The
Books and Records of Whitbread are complete and correct in all material respects
and have been maintained in accordance with good business
practice.  True and complete copies of all minutes, resolutions, stock
certificates and stock transfer ledgers of Whitbread are contained in the minute
books and stock transfer ledgers that have been delivered to the Buyer for
inspection and will be delivered to the Buyer at the Closing.  The
minute books, stock certificate books, stock transfer records and such other
books and other corporate records as may be requested by the Buyer, are complete
and correct in all material respects.




4.2           No
Violations of Laws or Agreements, Consents or Defaults.




(a)           The
execution and delivery of this Agreement and the consummation of the
transactions contemplated by this Agreement and the Related Agreements will not
result in any breach or violation of any of the terms or provisions of, or
constitute a default under, (i) the Articles of Organization or by-laws of
Whitbread or (ii) any statute, order, decree, proceeding, rule, or regulation of
any court or governmental agency or body, United States or foreign, having
jurisdiction over Whitbread, any assets of Whitbread or the Seller.




(b)           Except
as set forth in Schedule 4.2(b), the delivery of this Agreement, the Related
Agreements and the consummation of the transactions contemplated hereby and
thereby will not result in a breach or violation of the term of, or constitute a
default under, or require notice to any third party under, any agreement,
instrument, or commitment to which Whitbread or the Seller is party, by which it
or the Seller is bound, or to which any of Whitbread’s property is subject, and
no consent or approval is required from any third party for the transactions
contemplated by this Agreement and the Related Agreements.




(c)           Whitbread
is not in default under, or in violation of any provision of, its Articles of
Organization or by-laws, or, to the knowledge of Whitbread, any promissory note,
indenture or any evidence of indebtedness or security thereto, lease, purchase
contract or other commitment, or any other agreement that is material to the
Business of Whitbread.




4.3           No
Subsidiaries.  Whitbread does not own stock in and does not control,
directly or indirectly, any other corporation, association or business
organization.  Whitbread is not a party to any joint venture or
partnership, or similar arrangement or understanding.




4.4           Financial
Information.




(a)           Attached
hereto as Schedule 4.4(a) are true and complete copies of the Financial
Statements.  Except as set forth on Schedule 4.4(a), the Financial
Statements (except as may be disclosed therein), fairly present in all material
respects the financial position and the results of operations, changes in
shareholders equity and cash flows of Whitbread as of the dates and for the
periods indicated, and do not include or omit any material fact, the result of
which inclusion or omission is to make the Financial Statements materially
misleading.  The Financial Statements provide in all material respects
for all bad and doubtful debts, material liabilities (actual, contingent,
deferred or otherwise) and material financial commitments existing as of the
dates thereof.




(b)           Except
for obligations incurred in the ordinary course of business since December 31,
2002, Whitbread has no material unrecorded liability or obligation required to
be reflected or disclosed in the Financial Statements which is not so reflected
or disclosed, and Whitbread has no material liability or obligation, singularly
or in the aggregate, in the amount of $25,000 or more, whether accrued,
absolute, contingent or otherwise, as of the respective dates of the Financial
Statements not required to be reflected or disclosed in the Financial
Statements.




11




(c)           Except
as set forth on Schedule 4.4(c), there are no liabilities or obligations of
Whitbread whether known or unknown, asserted or unasserted, absolute or
contingent, accrued or unaccrued, liquidated or unliquidated, due or to become
due, required in accordance with GAAP to be reserved against or disclosed in the
Financial Statements, which are not so reserved or disclosed, nor, to the
knowledge of Whitbread, is there any past or present fact, situation,
circumstance, condition or other basis for any present or future action, suit or
proceeding, hearing, charge, complaint, claim or demand against Whitbread giving
rise to any such liability or obligation.




(d)           Except
as disclosed on Schedule 4.4(d), the Financial Statements do not reflect any
material income or expense that was unusual in nature, nonrecurring,
extraordinary, or otherwise not in the ordinary course of Whitbread’s Business,
consistent with past practices.




(e)           All
tangible assets used by Whitbread in the Business are reflected in the Financial
Statements.




4.5           Absence
of Certain Changes.  Since September 30, 2004, except as set forth on
Schedule 4.5, and except for transactions contemplated by this Agreement,
Whitbread has conducted the Business only in the ordinary course and consistent
with past practice, and has not:




(a)           suffered
any material adverse change;




(b)           incurred
any liabilities or obligations (absolute, accrued, contingent or otherwise)
except current liabilities incurred and liabilities under contracts entered into
in the ordinary course of business and consistent with past practice (including
obligations or liabilities arising from one transaction or a series of related
or similar transactions, and all periodic installments or payments under any
lease or other agreement providing for periodic installments or payments, as a
single obligation or liability), or increased, or experienced any change in any
assumptions underlying or methods of calculating any bad debt, contingency or
other reserves;




(c)           declared,
set aside or paid any non-cash dividend or distribution in respect of shares of
the capital stock of Whitbread or redeemed, purchased or otherwise acquired any
Whitbread capital stock;




(d)           issued,
delivered, or sold, or authorized the issuance, delivery or sale of, any share
of capital stock or any option or rights with respect thereto, or modification
or amendment of any right of any holder of outstanding shares of capital stock
or options with respect thereto;




(e)           paid,
discharged or satisfied any claims, liabilities or obligations (absolute,
accrued, contingent, known or unknown, or otherwise) other than the payment,
discharge or satisfaction in the ordinary course of business and consistent with
past practice of liabilities or obligations reflected or reserved against in the
balance sheet dated as of December 31, 2004 (the “Balance Sheet Date”) included
in the Financial Statements (the “Balance Sheet”) or incurred in the ordinary
course of business and consistent with past practice since the Balance Sheet
Date;




(f)           permitted
or allowed any of the assets or properties of Whitbread to be subjected to any
mortgage, pledge, lien, security interest encumbrance, restriction or charge of
any kind, except for (a) warehousemen’s mechanics’, materialmen’s, repairmen’s
or other like liens arising in the ordinary course of business consistent with
past practice securing sums which are not overdue, (b) pledges or deposits to
secure obligations under workmen’s compensation laws or similar legislation, (c)
deposits to secure public or statutory obligations of Whitbread or (d) deposits
to secure surety, appeal or customs bonds in the ordinary course of business
consistent with past practice (collectively “Permitted Liens”);




(g)           written
down the value of any inventory or written off as uncollectible any notes or
accounts receivable with a value greater than $25,000;




12




(h)           canceled
any debts, or waived any claims or rights of substantial value;




(i)           sold,
transferred or otherwise disposed of any of its properties or assets, except in
the ordinary course of business and consistent with past practice;




(j)           disposed
of or permitted to lapse any rights to the use of any patent, trademark, trade
name or copyright, or disposed of or disclosed to any Person other than an
Affiliate any invention, discovery, know-how, trade secret, formula, process or
other intellectual property not theretofore a matter of public
knowledge;




(k)           granted
any general increase in the compensation of employees of Whitbread (including
any such increase pursuant to any bonus, pension, profit sharing or other plan
or commitment) or any increase in the compensation payable or to become payable
to any employee of Whitbread in excess of merit increases consistent with past
practice, and no such increase is customary on a periodic basis or required by
agreement or understanding;




(l)           made
any capital expenditure or commitment for capital expenditures, other than those
capital expenditures or commitments that have been paid in full;




(m)           made
any change in any method of accounting or accounting practice or failed to
maintain the books and records of Whitbread in the ordinary course of business
and consistent with past practice;




(n)           failed
to maintain any of its properties or equipment in good operating condition and
repair, subject to ordinary wear and tear;




(o)           failed
to maintain in full force and effect all existing policies of insurance at least
at such levels as were in effect prior to such date or canceled any such
insurance or, to its knowledge, taken or failed to take any action that would
enable the insurers under such policies to avoid liability for claims arising
out of occurrences prior to the Closing; or




(p)           agreed
in writing or otherwise to take any action with respect to any of the matters
described in this Section 4.5.




4.6           Licenses;
Regulatory Approvals.  Whitbread holds all licenses, certificates and
other regulatory approvals required or necessary to be applied for or obtained
in connection with the Business as presently conducted by Whitbread except where
the failure to obtain or hold any of the foregoing would not have a material
adverse effect on Whitbread.  Except as set forth on Schedule 4.6, to
the knowledge of Whitbread all such licenses, certificates and other regulatory
approvals relating to the Business, operations and facilities of Whitbread are
in full force and effect.  Any and all past litigation concerning such
licenses, certificates and regulatory approvals, and all claims and causes of
action raised therein, have been finally adjudicated, and, in the case of such
litigation finally adjudicated since the Balance Sheet Date such adjudication
has not had a material adverse effect on Whitbread.  Except as set
forth on Schedule 4.6, no such license, certificate or regulatory approval has
been revoked, conditioned (except as may be customary) or restricted, and no
action (equitable, legislative or administrative), arbitration or other process
is pending, or to the knowledge of Whitbread, threatened, which in any way
challenges the validity of, or seeks to revoke, condition or restrict any such
license, certificate or regulatory approval.




4.7           Regulatory
Matters.




(a)           Except
as may be disclosed in Schedule 4.7(a), (i) Whitbread is not the subject of any
outstanding, and is not aware of any threatened, investigation, audit, review or
other examination of Whitbread by any federal or state governmental agency
having supervisory or regulatory authority with respect to Whitbread or the
Business, and (ii) Whitbread is not subject to, nor has Whitbread received any
notice that it may become subject to, any order, agreement, memorandum of
understanding or other regulatory enforcement action or proceeding with any
federal or state governmental agency having supervisory or regulatory authority
with respect to Whitbread or the Business.




13




(b)           Whitbread
is not aware of any proposed or pending change in any law or regulation
affecting the Business which would have a material adverse effect on
Whitbread.




4.8           Tax
Matters.




(a)           Whitbread
has prepared and filed in accordance with applicable laws, rules and regulations
all federal, state and local income, franchise, excise, sales, use, real and
personal property and other Tax Returns, information statements and reports
required to be filed by it, or Whitbread has prepared and filed appropriate
requests for extensions to file such Tax Returns and all such requests have been
timely filed and granted and have not expired in accordance with applicable
laws, rules and regulations.  All such Tax Returns for the last three
(3) years have been previously disclosed in full to the Buyer and are listed on
Schedule 4.8(a).




(b)           All
such Tax Returns correctly and completely reflect the information required to be
presented therein, and Whitbread has not paid any penalty, surcharge, fine or
interest in connection with any alleged underpayment of Taxes.




(c)           Except
as disclosed on Schedule 4.8(c) (which lists good faith tax disputes), Whitbread
has paid all Taxes that have become due and payable to (or claimed to be due and
payable by) any federal, state, county, local, foreign or other taxing
authority.  Whitbread has made full provision or reserve in the
Financial Statements for all Taxes for which Whitbread is or may be accountable
with respect to income, profits or gains earned, accrued or received on or
before the dates thereof, including distributions made on or before such dates
or provided for in such Financial Statements, and full and proper provision has
been made in such Financial Statements for deferred Tax  and in the
aggregate do not materially fail to provide for potential Tax
liabilities.  All estimated Tax payments that have become due and
payable prior to the date of this Agreement have been paid.  No claim
has ever been made by an authority in a jurisdiction where Whitbread does not
file Tax Returns that it is or may be subject to taxation by that
jurisdiction.  There are no liens for Taxes (other than Taxes not yet
due and payable) upon any of the assets of Whitbread.




(d)           Whitbread
has properly withheld from the salaries, wages or other compensation paid or
payable to officers, employees or other persons, and has paid to the appropriate
federal, state or local taxing authorities, any amounts required to be withheld
therefrom under applicable laws, rules or regulations.




(e)           To
Whitbread’s knowledge, no event, transaction, act or omission has occurred which
could result in Whitbread becoming liable for any Tax which is primarily or
directly chargeable against or attributable to a Person other than Whitbread or
which is charged by reference to the income or gains of another
Person.  In the event that Whitbread has been part of a consolidated
group of taxpayers, Whitbread is not liable for any Tax obligations of the other
members of the group.




(f)           To
Whitbread’s knowledge, no Tax Return (or item in a Tax Return) is currently
under audit by any taxing authority, and there are no agreements for the waiver
of any statute of limitations in respect of any Taxes or for the extension of
time for the assessment or payment of any Tax.  Whitbread is not, and
does not expect to be, involved in any material dispute in relation to any Tax
matters, and to Whitbread’s knowledge no taxing authority has investigated or
indicated that it intends to investigate Whitbread’s Tax
matters.  Whitbread is not aware of any facts which may constitute the
basis for the proposal of any Tax deficiencies for any unexamined
year.




(g)           Whitbread
is not a party to any agreement, contract, arrangement or plan that has resulted
or would result, separately or in the aggregate, in the payment of (i) any
“excess parachute payment” within the meaning of Code 280G (or any corresponding
provision of state, local or foreign Tax law) and (ii) any amount that will not
be fully deductible as a result of Code 162(m) (or any corresponding provision
of state, local or foreign Tax law).  To the knowledge of Whitbread,
Whitbread has not been a United States real property holding corporation within
the meaning of Code 897(c)(2) during the applicable period specified in Code
897(c)(1)(A)(ii).  Whitbread has disclosed on its federal income Tax
Returns all positions taken therein that could give rise to a substantial
understatement of federal income Tax within the meaning of Code
6662.  Whitbread is not a party to or bound by any Tax allocation or
sharing agreement.  Whitbread (i) has not been a member of an
“Affiliated Group” filing a consolidated federal income Tax Return and (ii) has
no liability for the Taxes of any Person under Reg. 1.1502-6 (or any similar
provision of state, local, or foreign law), as a transferee or successor, by
contract, or otherwise.




14




(h)           Whitbread
has not entered into any transaction or course of conduct (other than
legitimate, good faith Tax planning) designed in whole or in part to evade
Taxes.




(i)           Whitbread
will not be required to include any item of income in, or exclude any item of
deduction from, taxable income for any taxable period (or portion thereof)
ending after the Closing Date as a result of any:  (i) change in
method of accounting for a taxable period ending on or prior to the Closing Date
in accordance with Code 481 (or any corresponding or similar provision of state,
local or foreign income Tax law); (ii) “closing agreement” as described in Code
7121 (or any corresponding or similar provision of state, local or foreign
income Tax law) executed on or prior to the Closing Date; (iii) intercompany
transactions or any excess loss account described in Treasury Regulations under
Code 1502 (or any corresponding or similar provision of state, local or foreign
income Tax law); (iv) installment sale or open transaction disposition made on
or prior to the Closing Date; (v) prepaid amount received on or prior to the
Closing Date; (vi) transfer of intangible property to which Code 367(d) or Code
482 may apply.




4.9           Litigation
Claims.




(a)           There
is no action, suit, claim, investigation or proceeding, whether at law or in
equity (a “Claim”), pending or, to the knowledge of Whitbread, threatened that
questions the validity of this Agreement or the Related Agreements or any action
taken or to be taken by Whitbread or the Seller in connection with the
consummation of the transactions contemplated hereby or thereby or which seeks
to prohibit, enjoin or otherwise challenge any of the transactions contemplated
hereby or thereby.




(b)           Schedule
4.9(b) sets forth an accurate and complete list, and a brief description
(setting forth the names of the parties involved, the court or other
governmental or mediating entity involved, the relief sought and the substantive
allegations and the status thereof), of each Claim pending or, to the knowledge
of Whitbread, threatened against or affecting Whitbread.  None of the
pending or threatened Claims set forth on Schedule 4.9(b), if adversely
determined, would individually or in the aggregate, result in a materially
adverse effect on Whitbread.  To the knowledge of Whitbread no event
has occurred and no circumstance, matter or set of facts exist which would
constitute a valid basis for the assertion by any third party of any Claim,
other than those listed on Schedule 4.9(b).  Except as set forth in
Schedule 4.9(b) there is no outstanding or, to the knowledge of Whitbread,
threatened judgment, injunction, judgment, order or consent or similar decree or
agreement (including, without limitation, any consent or similar decree or
agreement with any governmental entity) against, affecting or naming
Whitbread.




(c)           To
Whitbread’s knowledge, except as disclosed in Schedule 4.9(c), there is no claim
(whether based on statute, negligence, breach of warranty, strict liability or
any other theory) pending or, to the knowledge of Whitbread, threatened relating
directly or indirectly to any product manufactured or sold, or any services
performed, by Whitbread.




4.10           Properties,
Contracts; Leases and Other Agreements; Bank Accounts.




(a)           Whitbread
does not own any real estate.




(b)           All
leasehold interests for real property and any material personal property used by
Whitbread in the Business are held pursuant to lease agreements which are valid
and enforceable in accordance with their terms, the agreements for which are
listed on Schedule 4.10(b).  To the knowledge of Whitbread, all such
properties comply in all material respects with all applicable private
agreements (to which Whitbread is a party), zoning requirements and other
governmental laws and regulations relating thereto and there are no condemnation
proceedings pending or, to the knowledge of Whitbread, threatened with respect
to such properties.  Whitbread has not assigned or subleased its
interests under such leases or the assets covered thereby.  Each such
lease has been duly and validly executed, is in full force and effect and
constitutes the valid and binding agreement of Whitbread thereto.




15




(c)           Except
as set forth on Schedule 4.10(c), and excluding trade accounts payable incurred
in the ordinary course of business and payable to Persons other than Affiliates
of Whitbread, Whitbread does not have any liabilities for borrowed funds,
extensions of credit or other advances that are subject to repayment whether
pursuant to a written agreement, oral understanding or course of conduct, and
whether reflected on the Financial Statements as indebtedness, accounts payable
or otherwise, and any such liability set forth on Schedule 4.10(c) may be
prepaid at any time without premium or penalty.




(d)           Except
as set forth in Schedule 4.10(d), Whitbread is not currently a party to any
agreements, contracts or commitments relating to the acquisition of the assets
or capital stock of any other business enterprise.




(e)           Except
as set forth in Schedule 4.10(e), Whitbread is not a party to any agreements,
loans, contracts, leases, guarantees, letters of credit, lines of credit or
commitments of Whitbread not referred to elsewhere in this Agreement
which:




(i)           involve
potential payments by Whitbread or incurring by Whitbread of costs or
obligations, of more than $10,000 in the aggregate;




(ii)           involve
payments based on profits of Whitbread;




(iii)           relate
to the future purchase of goods or services in excess of the requirements of the
Business at current levels or for normal operating purposes;




(iv)           include
powers of attorney or grants of agency by Whitbread;




(v)           cannot
be canceled by Whitbread without penalty or premium on no more than thirty (30)
days’ notice;




(vi)           were
not made in the ordinary course of business; or




(vii)           otherwise
materially affect the Business or financial condition of Whitbread.




(f)           Except
as set forth in Schedule 4.10(f), no current contracts material to the Business
are terminable or are subject to modification by reason of the consummation of
the transactions contemplated by this Agreement and the Related Agreements and
Whitbread has not received notice, of any potential termination or modification
of such contracts.




(g)           Except
as set forth in Schedule 4.10(g), to the knowledge of Whitbread, Whitbread is
not in default, technical or otherwise, of any real estate lease, equipment
lease, loan or credit agreement, or any other contract or agreement to which
Whitbread is a party , and to the knowledge of Whitbread no event or condition
has occurred or exists which, with the passage of time, giving of notice or
both, would cause any party to be in default thereunder.




(h)           Set
forth on Schedule 4.10(h) is an accurate and complete list showing the name and
address of each bank, securities broker, mutual fund, investment company,
investment adviser or other financial institution or similar Person with which
Whitbread has an account, including the account or box number and the names of
all persons and entities authorized to draw thereon or have access
thereto.




(i)           Except
as set forth on Schedule 4.10(i) all material contracts and agreements to which
Whitbread is a party (“Contracts”) (i) are valid and enforceable in accordance
with their respective terms, subject to the Enforceability Limitations; (ii) no
Default (as defined below) exists under any Contract either by Whitbread or, to
the knowledge of Whitbread, by any other party thereto; (iii) Whitbread is not
aware of the assertion by any third party of any claim of Default or breach
under any of the Contracts; and (iv) Whitbread has no knowledge of any present
intention on the part of any significant currently existing customer or supplier
or other business partner of Whitbread to either (a) terminate or significantly
adversely change its current existing business relationship with Whitbread
either now or in the foreseeable future, or (b) fail to renew or extend its
current existing business relationship with Whitbread at the end of the term of
any existing contractual arrangement such entity may have with
Whitbread.  For purposes of this Agreement, the term “Default” means,
with respect to any Contract, (x) any material breach of or default under such
Contract, (y) any event, other than the normal passage of time, which would
(either with or without notice or lapse of time or both) give rise to any right
of termination, cancellation or acceleration of any obligation to repay with
respect to such Contract, or (z) any event, other than the normal passage of
time, which would result in either a significant increase in the obligations or
liabilities of, or a loss of any significant benefit to, the party in question
under such Contract.




16




(j)           Set
forth on Schedule 4.10(j) is an accurate and complete list showing all Contracts
whereby Whitbread is providing products or services of any kind to a third party
where the value of such Contract equals or exceeds $25,000.




(k)           Except
as set forth on Schedule 4.10(k), Whitbread has not granted any right of first
refusal or similar right in favor of any third party with respect to any
material portion of its properties or assets or entered into any non-competition
agreement or similar agreement restricting its ability to engage in any business
in any location.




4.11           Employee
Matters; Benefit Plans; ERISA.




(a)           Except
as may be disclosed in Schedule 4.11(a), Whitbread has not entered into any
collective bargaining agreement with any labor organization with respect to any
group of employees of Whitbread and, to the knowledge of Whitbread, there is no
present effort nor existing proposal to attempt to unionize any group of
employees of Whitbread.




(b)           Except
as may be disclosed in Schedule 4.11(b):




(i)           Whitbread
is and has been in material compliance with all applicable laws relating to
employment and employment practices, terms and conditions of employment and
wages and hours, including, without limitation, any such laws respecting
employment discrimination and occupational safety and health requirements, and
Whitbread is not engaged in any unfair labor practices;




(ii)           There
is no material unfair labor practice complaint against Whitbread pending or, to
the knowledge of Whitbread, threatened before the National Labor Relations
Board;




(iii)           There
is no labor dispute, strike, slowdown or stoppage actually pending or, to the
knowledge of Whitbread, threatened against or directly relating to Whitbread;
and




(iv)           Whitbread
has not experienced any material work stoppage or other material labor
difficulty during the past year.




(c)           Other
than Whitbread’s standard offer letter, a copy of which has been furnished to
the Buyer, and except as described and attached to Schedule 4.11(c), Whitbread
is not a party to any agreement for the employment, retention  or
severance of any officer, employee, agent, advisor or consultant.




(d)           Schedule
4.11(d) contains a correct and complete list of all Benefit Plans maintained by
Whitbread or to which Whitbread or any ERISA Affiliate (as defined below)
contributes.  Whitbread has delivered or made available to the Buyer,
with respect to all such Benefit Plans, complete and correct copies of the
following:  all plan documents, handbooks, manuals, collective
bargaining agreements and similar documents governing employment policies,
practices and procedures;  the most recent summary plan descriptions
and any subsequent summaries of material modifications and all other material
employee communications discussing any employee benefit; Forms series 5500 as
filed with the IRS for the three most recent plan years (including all
attachments thereto);  the most recent report of the enrolled actuary
for any plans requiring actuarial valuation;  all trust agreements
with respect to the Benefit Plans;  plan contracts with service
providers or insurers providing benefits for participants or liability insurance
for fiduciaries and other parties in interest or bonding;  the most
recent annual audit and accounting of plan assets for all funded
plans;  and the most recent Internal Revenue Service (“IRS”)
determination letter or opinion letter for all plans qualified under Section
401(a) of the Code.




17




(e)           Neither
Whitbread nor any ERISA Affiliate participates in or maintains or has ever
maintained or been obligated to contribute to a multi-employer plan (as defined
in Section 3(37) of ERISA), and neither Whitbread nor any ERISA Affiliate has
withdrawal liability with respect to any multi-employer plan.




(f)           Neither
Whitbread nor any ERISA Affiliate maintains or has ever maintained or been
obligated to contribute to an employee pension benefit plan (as defined in
Section 3(2) of ERISA) subject to Title IV of ERISA.




(g)           Whitbread
has made full payment of all amounts it is required, under applicable law or the
terms of each Benefit Plan, to have contributed thereto before the Closing Date
for all periods through and including the close of the last plan year ending
prior to the Closing Date, or proper accruals for such contributions have been
made and are reflected on its balance sheet and books and
records.  Whitbread will pay such contributions to the Benefit Plans
for the current plan year prior to the Closing Date, or, if any such
contributions will not be due prior to the Closing Date, has made adequate
provision for reserves therefor.  All such contributions are fully
deductible by Whitbread for purposes of Whitbread’s federal income taxes, and
Whitbread has no actual or potential liability for the 10 percent tax imposed by
section 4972 of the Code.




(h)           All
Taxes, penalties, interest charges and other financial obligations to federal,
state and local governments and to participants or beneficiaries under the
Benefit Plans with respect to any period ending on or before the Closing Date
have been or will be met in full on or before the Closing Date.




(i)           All
reports, returns, notices and similar documents with respect to the Benefit
Plans required to be filed with any governmental agency or distributed to any
Benefit Plan participant or beneficiary have been duly and timely filed or
distributed.




(j)           Each
Benefit Plan required to be listed on Schedule 4.11(d) that is intended to be
qualified under Section 401 of the Code is (and from its establishment has been)
the subject of a favorable determination letter or opinion letter issued by the
IRS, and no such determination letter or opinion letter has been revoked nor, to
Whitbread’s knowledge, has revocation been threatened, nor has any Benefit Plan
been amended since the date of its most recent determination letter or
application therefor in any respect which would adversely affect its
qualification or materially increase its cost, and no Benefit Plan has been
amended in a manner that would require security to be provided in accordance
with Section 401(a)(29) of the Code.  Each trust maintained under any
such Benefit Plan is (and from its establishment has been) exempt from federal
income tax under Section 501 of the Code.




(k)           Each
Benefit Plan required to be listed on Schedule 4.11(d) complies, in both form
and operation, with the applicable requirements of ERISA, the Code and other
applicable law.  There are no termination proceedings involving the
Benefit Plans and, to Whitbread’s knowledge, no pending investigations by any
governmental agency involving such Benefit Plans and no threatened or pending
claims (except for routine claims for benefits), suits or proceedings against
any Benefit Plan or asserting any rights or claims to benefits under any Benefit
Plan which could give rise to any liability nor, to Whitbread’s knowledge, are
there any facts which could give rise to any liability in the event of any such
investigation, claim, suit or proceeding.




(l)           Neither
Whitbread nor any “party in interest” (as defined in section 3(14) of ERISA) or
“disqualified person” (as defined in section 4975(e)(2) of the Code) with
respect to any Benefit Plan has engaged in a “prohibited transaction” (as
defined in Section 4975 of the Code or Section 406 of ERISA) for which a
statutory, administrative, or regulatory exemption is not
available.  No Benefit Plan has been (or will be as a result of the
transactions contemplated hereby) completely or partially terminated or has been
(or will be as a result of the transactions contemplated hereby) subject to a
“reportable event” (as defined in section 4043 of ERISA) or to any event
requiring disclosure under section 4062(e) or 4063(a) of ERISA.




18




(m)           Whitbread
is in full compliance with the continuation coverage requirements of the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and the
health insurance obligations (sometimes referred to as “HIPAA”) imposed by
section 9801 of the Code and Part 7 of Subtitle B of Title I of ERISA, except
where the failure to comply would not have a material adverse effect on
Whitbread.




(n)           Other
than the group health plan continuation coverage requirements required by
applicable law (as described in subsection (m) above), the cost of which is
fully paid by the former employee or his or her dependent, Whitbread does not
maintain retiree life or retiree health plans providing for continuing coverage
for any employee or any beneficiary of an employee after the employee’s
termination of employment.




(o)           Except
as set forth on Schedule 4.11(o), Whitbread is not a party to any oral or
written agreement with any director, executive, officer or other key employee,
the benefits of which are contingent or the terms of which are materially
altered or permit termination, upon the occurrence of a transaction of the
nature contemplated by this Agreement and the Related Agreements, and which
provides for the payment of in excess of Fifty Thousand Dollars ($50,000), or
agreement or plan, including any stock option plan, stock appreciation rights
plan, restricted stock plan or stock purchase plan, any of the benefits of which
will be increased, or the vesting of which will be accelerated, by the
occurrence of any of the transactions contemplated by this Agreement and the
Related Agreements or the value of any of the benefits of which will be
calculated on the basis of any of the transactions contemplated by this
Agreement and the Related Agreements.




4.12           Personnel.




(a)           Schedule
4.12(a)  contains a true and complete list of the following
information for all persons employed by Whitbread, including each employee on
leave of absence or layoff status:




(i)           Name




(ii)           Job
title




(iii)           Department
(if applicable)




(iv)           Indicate
Billable/Non Billable




(v)           Hourly
Rate




(vi)           Annual
Salary (Current)




(vii)           Gross
Salary 2004




(viii)           Bonus
paid 2004




(ix)           Hire
date




(x)           Vacation
accrued




(xi)           Service
credited for purposes of vesting and eligibility to participate under any
pension, retirement, profit-sharing, option, cash bonus, ownership
plan




(xii)           Severance
pay




(xiii)           Any
assignment of inventions or similar agreement




(b)           Schedule
4.12(b) contains a correct and complete description of Whitbread’s performance
measurement and compensation policies and procedures as they relate to employees
in effect as of the Closing Date and for the year prior to the Closing
Date.




19




(c)           Schedule
4.12(c) lists all individuals who are currently engaged in the Business and who
are classified as “consultants” or “independent contractors,” the compensation
of each such person and whether Whitbread is party to an agreement with such
person (whether or not in writing).  Any such agreements are listed on
Schedule 4.12(c) and have been delivered (or, in the case of agreements that are
not in writing, a summary thereof has been delivered) to the
Buyer.  To Whitbread’s knowledge, all individuals engaged by Whitbread
as independent contractors, rather than employees, have been properly classified
as such and have been engaged in accordance with all applicable foreign,
federal, state and/or local laws.




(d)           Except
as disclosed in Schedule 4.12(d), (i) none of the employees of Whitbread has
notified or otherwise indicated to Whitbread that he or she intends to terminate
his or her employment with Whitbread, or not to continue employment after the
Closing; (ii) Whitbread does not have a present intention to terminate the
employment of any employee;(iii) all employees of Whitbread have executed its
form of nondisclosure and developments agreement or noncompetition,
nondisclosure and developments agreement, as the case may be; (iv) no employee
of Whitbread is a party to or is bound by any employment contract, patent
disclosure agreement, noncompetition agreement or other restrictive covenant or
other contract with any Person that would be likely to affect in any way (A) the
performance by such employee of any of his or her duties or responsibilities as
a employee, or (B) the business or operations of Whitbread; (v) to the knowledge
of Whitbread, no employee of Whitbread is in violation of any term of any
employment contract, patent disclosure agreement, noncompetition agreement, or
any other restrictive covenant with or to a former employer relating to the
right of any such employee to be employed by Whitbread; and (vi) Whitbread is
not and since January 1, 2004 has never has been engaged in any litigation with
an employee or former employee.




(e)           Whitbread
is in compliance, and has complied, in all material respects with all applicable
laws respecting employment and employment practices, terms and conditions of
employment and wages and hours.  Whitbread is not liable for the
payment of material Taxes, fines, penalties or other amounts, however
designated, for failure to comply with any of the foregoing
laws.  Whitbread is not engaged, and to the knowledge of Whitbread has
never engaged, in any unfair labor practice of any nature.  Whitbread
has not failed to pay any of its employees, consultants or contractors for any
required wages (including overtime), salaries, commissions, bonuses, benefits or
other direct compensation for any services performed by them to the date hereof
or amounts required to be reimbursed to such individuals.




(f)           The
Sellers are in full compliance with and have not violated the terms and
provisions of the Immigration Reform and Control Act of 1986, and the rules and
regulations promulgated thereunder (the “Immigration Laws”).  With
respect to each employee (as defined in Section 274a.1(f) of Title 8, Internal
Revenue Code of Federal Regulations) of the Sellers for whom compliance with the
Immigration Laws by an employer (as defined in Section 274a.1(g) of Title 8,
Internal Revenue Code of Federal Regulations) is required, the Sellers, have
made available to the Buyer prior to the Closing Date copies of such employee’s
Form I-9 (Employment Eligibility Verification Form) and all other records,
documents or other papers which are retained with the Form I-9 by the employer
pursuant to the Immigration Laws.  The Sellers have never been the
subject of any inspection or, to the Sellers’ knowledge, any investigation
relating to its compliance with or violation of the Immigration Laws, nor has it
been warned, fined or otherwise penalized by reason of any failure to comply
with the Immigration Laws, nor is any such proceeding pending or, to Sellers’
knowledge, threatened.




4.13           Title
to and Condition of Properties.




(a)           Except
as described in Schedule 4.13(a), Whitbread collectively owns or uses all of the
personal property included in the Balance Sheet (except assets as have been
disposed of in the ordinary course of Whitbread’s business since the Balance
Sheet Date), which owned assets are free and clear of all Encumbrances and
rights to possession of third parties, of every type and nature (other than
Permitted Liens).  The assets of Whitbread are sufficient to carry on
the Business of Whitbread in the ordinary course as presently
conducted.  Other than as disclosed in Schedule 4.13(a) or
specifically provided for in this Agreement, Whitbread has not entered into any
agreements, recorded or unrecorded, granting rights to third parties in any real
or tangible personal property of Whitbread, and, except for property leased by
Whitbread, to Whitbread’s knowledge, no person or other company has any right to
possession, use or occupancy of any of the tangible property used by
Whitbread.




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(b)           Except
for inventory that is excess, damaged or obsolete, for which Whitbread has
established in the aggregate an adequate reserve in the Balance Sheet, the
inventory reflected in the Balance Sheet (if any) and not disposed of or
reserved since such date is of good and merchantable quality, of a quantity and
quality saleable in the ordinary course of business of Whitbread in accordance
with past practices and is adequate as of the date hereof for the business of
Whitbread as conducted as of such date.




(c)           Equipment
used by Whitbread in the conduct of its business is, as of the date hereof,
taken as a whole in good and operating condition (reasonable wear and tear
excepted) and is sufficient to carry on the business of Whitbread in the
ordinary course as it is presently conducted.




4.14           Product
and Service Warranties.  Except as set forth on Schedule 4.14, each
product or service delivered or licensed by Whitbread has been in conformity in
all material respects with all applicable federal, state, local or foreign laws
and regulations, contractual commitments and all express and implied warranties,
and, to the knowledge of Whitbread, Whitbread has no liability for replacement
or repair thereof or other damages in connection therewith, except for
liabilities incurred in the ordinary course of business, and no product or
service delivered or licensed by Whitbread is subject to any guaranty, warranty,
or other indemnity.




4.15           Intellectual
Property.




(a)           Except
as set forth on Schedule 4.15(a), Whitbread owns, free and clear of all liens,
mortgages, security interests, charges and encumbrances of every nature, kind
and description (other than Permitted Liens), and has good and merchantable
title to, or holds adequate licenses or otherwise possesses all rights necessary
to use, all patents, trademarks, service marks, trade names, copyrights
(including any applications for any of the foregoing), the domain name
www.whitbread.net, all other names embodying business or product goodwill (or
both), inventions, discoveries and improvements, processes, know-how, trade
secrets, scientific, technical, engineering and marketing data, computer
programs, software, including all object and source codes, programming tools and
all other techniques used or necessary for the conduct of the Business as now
conducted (collectively, the “Intellectual Property”).




(b)           Schedule
4.15(b) contains an accurate and complete list of (i) all such patents,
trademarks, trade names, service marks, assumed names and copyrights, and all
applications therefor, and, with respect to registered items, contains a list of
all jurisdictions in which such items are registered and all registration
numbers; (ii) all licenses, permits and other agreements relating thereto; and
(iii) all agreements relating to any of the Intellectual Property that Whitbread
is licensed or authorized to use by others.  The patents, trademarks,
service marks and copyrights, licenses, permits and other agreements
constituting a part of the Intellectual Property and solely owned by Whitbread,
if any, are valid, subsisting and enforceable, and are duly recorded in the name
of Whitbread.




(c)           All
software, other than generally available software such as Microsoft Word, Lotus
1-2-3, and the like and other standard “off-the-shelf” software, and generally
available system development tools, that is marketed and distributed to
customers of Whitbread in connection with the Business as a program is owned by
Whitbread or Whitbread has the right to use, distribute and sublicense the
foregoing, except as may be set forth in any license agreement listed in
Schedule 4.15(c).  To the extent third party software is marketed to
customers of Whitbread together with the Intellectual Property solely owned by
Whitbread all necessary licenses have been obtained and no royalties or payments
are due from Whitbread to third parties except as identified on Schedule
4.15(c).




(d)           Except
as set forth on Schedule 4.15(d), to the knowledge of Whitbread, Whitbread has
the sole and exclusive right to use the patents, service marks and copyrights
listed in Schedule 4.15(b) and the trademarks and trade names listed in Schedule
4.15(b), in each case, in all jurisdictions in which the Business is conducted
or in which any products of the Business are distributed, and the consummation
of the transactions contemplated hereby will not alter or impair any such
rights.




(e)           No
claims have been asserted by any Person challenging or questioning the
ownership, validity, enforceability or use by Whitbread of any of the
Intellectual Property and, to the knowledge of Whitbread, there is no valid
basis for any such claim, and, to the knowledge of Whitbread, the use or other
exploitation of the Intellectual Property by Whitbread does not infringe on the
rights of any Person; and, to the knowledge of Whitbread, no Person is
infringing on the rights of Whitbread with respect to any of the Intellectual
Property.




21




(f)           Whitbread
has taken all reasonable security measures to protect the secrecy,
confidentiality and value of the Intellectual Property of Whitbread, including
computer programs, trade secrets and other confidential
information.  Except as disclosed in Schedule 4.15(f), no Person has
any marketing rights to the Intellectual Property of Whitbread.  No
Person listed in such schedule is in breach or default under its
obligations.




(g)           Except
as set forth on Schedule 4.15(g), each employee, officer, consultant and
contractor of Whitbread and/or any other person or entity developing
intellectual property on behalf of Whitbread has entered into and executed an
ownership and nondisclosure agreement (collectively, the “Ownership and
Nondisclosure Agreements”) substantially in the form attached to this Agreement
as Exhibit A.




(h)           Whitbread
has made available to the Buyer all documents in Whitbread’s custody, possession
or control with respect to any invention, discovery, process, design, computer
program or other know-how or trade secret included in the Intellectual Property,
which documents shall be accurate in all material respects and reasonably
sufficient in detail and content to identify and explain such invention,
discovery, process, design, computer program or other know-how or trade secret
and to facilitate its full and proper use.




4.16           Insurance.  Schedule
4.16 lists all policies of insurance owned or held by Whitbread or insuring its
assets.  All current premiums and any other obligations under such
insurance have been paid, and all such policies are valid and enforceable and in
full force and effect on the date hereof.  Whitbread has not received
any notice of cancellation or of premium increase under any such policies within
the last ninety (90) days.




4.17           Relationships.




(a)           Other
than general economic conditions, Whitbread has no knowledge of any present
conditions or state of facts or circumstances which would materially adversely
affect Whitbread after the Closing Date.




(b)           Schedule
4.17(b) lists the 10 most important customers of Whitbread as a percentage of
revenues for fiscal years 2003 and 2004.  Whitbread’s relationships
with its current customers, clients and vendors are satisfactory, and Whitbread
has no knowledge of any facts or circumstances, including a change of control in
the ownership of Whitbread, that might materially alter, negate, impair or in
any way materially adversely affect the continuity of any such existing
relationships and the Business.




(c)           Except
as disclosed in Schedule 4.17(c), Whitbread has no knowledge of and has not
received notice of any complaints, claims or threats, plans or intentions to
discontinue commercial relations or transactions from any existing customer of
Whitbread, any purchaser of goods or services from Whitbread, any employee or
independent contractor significant to the conduct or operation of Whitbread or
any party to any agreement to which Whitbread is a party.




(d)           Whitbread
has no knowledge of any present condition or state of facts or circumstances,
including a change of control in the ownership of Whitbread, that would
materially prevent the Business of Whitbread from being carried on after the
Closing Date in essentially the same manner as it is presently being carried
on.




4.18           Compliance
With Laws.




(a)           Except
as set forth in Schedule 4.18(a), the operations and activities of Whitbread has
previously and continues to comply in all material respects with all applicable
Federal, state and local laws, statutes, codes, ordinances, rules, regulations,
permits, judgments, orders, writs, awards, decrees or injunctions (collectively,
the “Laws”) as in effect on or before the date of this Agreement, including
without limitation, all rules and regulations of the Occupational Safety and
Health Administration.  The conduct of the Business of Whitbread as
presently conducted does not or violate or, with or without the giving of notice
or the passage of time, or both, will violate, conflict with or result in a
default, right to accelerate or loss of rights under, any terms or provisions of
its Articles of Organization or by-laws as presently in effect or, to the
knowledge of Whitbread, any Encumbrance, lease, license, agreement, Laws or
understanding to which Whitbread is a party or by which it may be bound or
affected.  Whitbread has received no notice or communication from any
Person asserting a failure to comply with any Laws, nor has Whitbread received
any notice that any authority or third party intends to seek enforcement against
Whitbread to compel compliance with any such Laws.




22




(b)           (i) Whitbread has not made, and,
to the knowledge of Whitbread, no officer, director, employee, agent or other
representative of any of them acting on behalf thereof has made, directly or
indirectly, with respect to the business of Whitbread, any illegal bribes,
kickbacks or other illegal payments of a similar nature, or illegal political
contributions with corporate funds not recorded in the corporate records of
Whitbread, illegal payments from corporate funds to governmental officials, or
illegal payments from corporate funds to obtain or retain business either within
the United States or abroad, and (ii) neither Whitbread nor, to the knowledge of
Whitbread, any officer, employee or agent of Whitbread acting on its behalf, nor
any other Person acting on its behalf has, directly or indirectly, within the
past three (3) years given or agreed to give any gift or similar benefit to any
customer, supplier, governmental employee or other Person who is or may be in a
position to help or hinder Whitbread (or assist Whitbread in connection with any
actual or proposed transaction) which (A) might subject Whitbread to any damage
or penalty in any civil, criminal or governmental litigation or proceeding, (B)
if not given in the past might have had a material adverse effect to Whitbread,
or (C) if not continued in the future, might result in a material adverse effect
to Whitbread.




4.19           Environmental
Matters.




(a)           Whitbread
has not obtained and is not required to obtain, any permits, licenses or other
authorizations under any applicable Environmental Laws.




(b)           Except
as set forth on Schedule 4.19, Whitbread is, to its knowledge, in material
compliance with all limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
the Environmental Laws.  Except as set forth on Schedule 4.19, since
Whitbread’s incorporation, no written notice, demand, request for information,
citation, summons or complaint has been received or order has been issued, no
complaint has been filed, no suit or action has been instituted, no penalty has
been assessed and no investigation or review is pending or, to the knowledge of
Whitbread, threatened by any governmental entity or other Person with respect to
any (i) alleged violation by Whitbread of any Environmental Law or liability
thereunder, (ii) alleged failure by Whitbread to have any permit, certificate,
license, approval, registration or authorization required under any
Environmental Law, (iii) release of Hazardous Substances by or on behalf of
Whitbread, or (iv) any Environmental Liabilities attributed to
Whitbread.




(c)           Except
as set forth on Schedule 4.19, there are no Environmental Liabilities that have
had, or could reasonably be expected to have individually, or in the aggregate,
a material adverse effect with respect to Whitbread.




(d)           Except
as set forth on Schedule 4.19, to the knowledge of Whitbread, no state of facts
exists as to environmental matters or Hazardous Substances that involves the
reasonable likelihood of a material capital expenditure by Whitbread or a
material fine or penalty imposed on or attributable to Whitbread, or that may
otherwise have a material adverse effect with respect to Whitbread or does or
could interfere with or prevent compliance with any Environmental Laws or give
rise to any common law or other legal liability.




(e)           No
Hazardous Substances have been manufactured, treated, stored, transported or
disposed of by Whitbread, or otherwise deposited by Whitbread, in or on or are
present beneath properties currently or formerly owned, leased or used by
Whitbread in violation of, or which may be required to be investigated or
remediated under, any applicable Environmental Laws.




(f)           There
has been no disposal, escape, seepage, leakage, spillage, discharge, emission,
release or threatened release of any Hazardous Substance as a result of the
actions or omissions of Whitbread (i) on, from or affecting any properties
owned, leased or used by Whitbread, or (ii) for which Whitbread is, is alleged
or may be held to be, responsible as a result of conduct occurring or conditions
existing at or before Closing.




23




4.20           Receivables.  Schedule
4.20 sets forth a true and complete list of all Receivables as of February 28,
2005 and the aging thereof.  All Receivables represent sales actually
made or services actually performed in the ordinary course of business with no
additional services required to entitle Whitbread to collect such Receivables,
and have been fully collected or are fully reserved against in the Balance Sheet
or to the knowledge of Whitbread are fully collectible as of the Closing
Date.




4.21           Related
Party Transactions.  Except as set forth on Schedule 4.21, there have
been no transactions or contractual relationships during the two (2) fiscal
years ended December 31, 2003 or between December 31, 2003 and the date hereof,
and no agreement or understanding to enter into or consummate any transactions
or contractual relationships between Whitbread on the one hand and (a) any of
Whitbread’s officers, directors, employees, representatives, or agents or (b)
any family member (by blood or marriage) or Affiliate of any of the foregoing,
directly or indirectly, on the other hand.  All such transactions have
been on terms and conditions no less favorable to Whitbread than could have been
obtained from any independent party after arms-length
negotiations.  Schedule 4.21 sets forth the relationship between any
such Person and Whitbread.




4.22           Brokers.  Except
for Sunbelt Business Advisors, no Person will have, as a result of the
transactions contemplated by this Agreement, any valid right to, interest in or
claim upon the Buyer or Whitbread for any commission, fee or other compensation
as a finder or broker because or any act or omission by Whitbread or the
Seller.




4.23           Disclosure.  No
representation or warranty by Whitbread contained in this Agreement, and no
statement contained in any document, list (including, without limitation, the
Schedules), certificate or other communication furnished or to be furnished by
or on behalf of Whitbread to the Buyer or any of its representatives in
connection with the transactions contemplated hereby, when taken together with
all the written documents, certificates and other instruments furnished or to be
furnished by or on behalf of Whitbread pursuant to this Agreement, contains or
will contain any untrue statement of a material fact, or omits or will omit to
state any material fact necessary, in light of the circumstances under which it
was or will be made, in order to make the statements herein or therein not
misleading.




ARTICLE
V.




REPRESENTATIONS
AND WARRANTIES OF THE SELLER




As a
material inducement for the Buyer to enter into this Agreement and to consummate
the transactions contemplated hereby, the Seller hereby make the following
representations and warranties as of the date hereof, each of which is relied
upon by the Buyer regardless of any investigation made or information obtained
by or on behalf of the Buyer:




5.1           Shareholder
Power and Authority; Ownership.




(a)           The
Seller is an adult individual with full power and authority to own his
properties, to manage his fiscal affairs and to enter into this Agreement and
each of the Related Agreements to which he is a party and to agree to the
transactions contemplated hereby and thereby and to perform all of his
obligations hereunder and thereunder.  The Seller is not subject to
any legal disability which would prevent him from performing under this
Agreement or any Related Agreement, and no order has been entered appointing a
receiver for the Seller or his assets.  There is no claim, action,
suit or proceeding (including, without limitation, current investigations by
governmental agencies) pending against the Seller seeking to enjoin the
execution and delivery of this Agreement, the Related Agreements or consummation
of the transactions contemplated hereby or thereby.




(b)           This
Agreement and each of the Related Agreements to which the Seller is a party
constitutes the legal, valid and binding obligations of the Seller, enforceable
against him in accordance with their respective terms, subject to the
Enforceability Limitations.




(c)           The
Seller owns that number of Shares set forth in Schedule 5.1(c) which constitutes
all of the issued and outstanding capital stock of Whitbread.  The
Seller has good and marketable title to all of the Shares set forth on Schedule
5.1(c), free and clear of all Encumbrances and restrictions, legal or equitable,
of every kind.  The Seller has full and unrestricted legal right,
power, and authority to sell, assign, and transfer the Shares without obtaining
the consent or approval of any other person, entity, or governmental authority
and the delivery of the Shares to the Buyer pursuant to this Agreement will
transfer valid title thereto, free and clear of all Encumbrances, claims, and
restrictions of every kind, except for restrictions on transferability imposed
by federal and state securities laws.  The Seller hereby waives, as of
the Closing Date, all rights that exist pursuant to all shareholder agreements
and other contractual rights or charter document provisions relating to the
transferability of his Shares, as and to the extent necessary to permit the
consummation of the transactions provided for herein.




24




5.2           Securities
Matters.  The Seller understands that none of the shares of Buyer
Stock included in the Purchase Price has been registered under the Securities
Act, on the grounds that the issuance thereof to the Seller in connection with
the transactions contemplated by this Agreement and the Related Agreements is
exempt from registration pursuant to Section 4(2) of the Securities Act and/or
Regulation D promulgated under the Securities Act (“Regulation D”), and that the
reliance of the Buyer on such exemptions is predicated in part on the
representations, warranties, covenants and acknowledgements set forth in this
Section 5.2.




(a)           The
Buyer Stock will be acquired by the Seller for his own account, not as a nominee
or agent, for investment and without a view to resale or other distribution
within the meaning of the Securities Act, and the Seller will not distribute or
transfer any of the Buyer Stock in violation of the Securities Act.




(b)           The
Seller:  (i) acknowledges that the Buyer Stock to be issued to him is
not registered under the Securities Act and must be held indefinitely by the
Seller unless the Buyer Stock is subsequently registered under the Securities
Act or an exemption from registration is available, (ii) is aware that any
routine sales of the Buyer Stock made under Rule 144 of the Securities and
Exchange Commission under the Securities Act may be made only in limited amounts
and in accordance with the terms and conditions of that Rule and that in such
cases where the Rule is not applicable, registration or compliance with some
other registration exemption will be required, (iii) is aware that Rule 144 is
not now and for a period of at least one year following the Closing Date hereof
will not be, available for use by the Seller for resale of the Buyer Stock, and
(iv) is aware that the Buyer is not obligated to register any sale, transfer or
other disposition of the Buyer Stock.




(c)           The
Seller has such knowledge and experience in financial and business matters that
he is fully capable of evaluating the risks and merits of his investment in the
Buyer Stock.




(d)           The
Seller acknowledges and agrees that the certificates representing the Buyer
Stock issuable to him will contain a restrictive legend noting the restrictions
on transfer described in this Section and under federal and applicable state
securities laws, and that appropriate “stop-transfer” instructions will be given
to the Buyer’s stock transfer agent.




ARTICLE
VI.




REPRESENTATIONS
AND WARRANTIES OF THE BUYER.




As a
material inducement for Whitbread and Seller to enter into this Agreement and to
consummate the transactions contemplated hereby, the Buyer makes the following
representations and warranties as of the date hereof, each of which is relied
upon by Whitbread regardless of any investigation made or information obtained
by Whitbread:




6.1           Organization,
Existence and Capital Stock.




(a)           The
Buyer is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware and has all necessary corporate power to
own all of its property and assets, to incur all of its liabilities and to carry
on its business as presently conducted.  The Buyer is duly qualified
to do business and is in good standing as a foreign corporation in each
jurisdiction where the nature of its business or its ownership of property makes
such qualification necessary, other than where such failure to so qualify would,
individually or in the aggregate, not have a material adverse effect on the
Buyer.




(b)           The
authorized capital stock of the Buyer consists of preferred stock, $.001 par
value per share, 10,000,000 shares of which are validly authorized and none of
which is issued or outstanding, and of common stock, $.001 par value per share,
50,000,000 shares of which are validly authorized and 28,563,846 shares of which
are validly issued, outstanding, fully paid and non-assessable and none of such
shares were issued in violation of any preemptive rights or in violation of any
federal or state law.  The Buyer ‘s common stock has been duly and
validly registered pursuant to Section 12(g) of the Exchange Act, which
registration is in full force and effect.




25




(c)           None
of the outstanding shares of the Buyer’s capital stock has been issued in
violation of any preemptive rights of the current or past stockholders of the
Buyer, or any agreement to which the Buyer was or is a party or
bound.  All of the shares of Buyer Stock issued in connection with the
transactions contemplated by this Agreement will be, when issued in accordance
with this Agreement, duly authorized, validly issued, fully paid, nonassessable,
and free of all preemptive rights.  The shares of Buyer Stock issued
in connection with the transactions contemplated by this Agreement will be
issued in the name of the Seller, as recorded in the Books and Records of
Whitbread, with the Seller as record holder of such shares, and the Seller shall
have good and marketable title to such shares of Buyer Stock, free of any liens,
other than those created by or through the Seller pursuant to the Lock Up
Agreement or otherwise.




(d)           Except
as set forth on Schedule 6.1(d) there are no issued or outstanding options,
warrants, rights to subscribe for, calls, or commitments of any character
whatsoever relating to, or securities or rights convertible into or exchangeable
for, shares of the capital stock of the Buyer, or contracts, commitments,
understandings or arrangements by which the Buyer is or may be obligated to
issue additional shares of its capital stock or options, warrants or rights to
purchase or acquire any additional shares of its capital stock.




6.2           Power
and Authority.  Subject to the satisfaction of the conditions
precedent set forth herein, the Buyer has the corporate power to execute,
deliver and perform this Agreement and the Related Agreements and to consummate
the transactions contemplated hereby, and, subject to the satisfaction of the
conditions precedent set forth herein, has taken all action required by law, its
certificate of incorporation, its by-laws or otherwise, to authorize the
execution and delivery of this Agreement and such related
documents.  The execution and delivery of this Agreement does not, and
the consummation of the transactions contemplated hereby will not, violate any
provisions of the certificate of incorporation or by-laws of the Buyer or any
mortgage, lien, lease, agreement, instrument, order, arbitration award, judgment
or decree to which the Buyer is a party or by which it or its properties is
bound, any legal or other restrictions of any kind to which the Buyer is
subject, or result in the creation of any lien, charge or encumbrance upon any
of the property or assets of the Buyer.  This Agreement is a valid
obligation of the Buyer and is legally binding on it in accordance with its
terms.  Since May 1, 2002, the Buyer has not consummated any
acquisitions of any other companies or entities where it has paid, taking all
such acquisitions into account, aggregate consideration of $94,000,000 or
more.




6.3           No
Violations of Laws or Agreements, Consents or Defaults.




(a)           The
execution and delivery of this Agreement and the consummation of the
transactions contemplated by this Agreement and the Related Agreements will not
result in any breach or violation of any of the terms or provisions of, or
constitute a default under, (i) the certificate of incorporation or by-laws of
the Buyer or (ii) any statute, order, decree, proceeding, rule, or regulation of
any court or governmental agency or body, United States or foreign, having
jurisdiction over the Buyer or any assets of the Buyer.




(b)           Except
as set forth in Schedule 6.3(b) the execution and delivery of this Agreement,
the Related Agreements and the consummation of the transactions contemplated
hereby and thereby will not result in a breach or violation of the term of, or
constitute a default under, any agreement, instrument, or commitment to which
the Buyer is a party, by which it is bound, or to which any of the Buyer’s
property is subject, and no consent or approval is required from any third party
for the consummation of the transactions contemplated by this Agreement or the
Related Agreements.  Except as set forth in Schedule 6.3(b) the
execution and delivery of this Agreement, the Related Agreements and the
consummation of the transactions contemplated hereby and thereby will not result
in the creation of any lien, charge or encumbrance upon any of the Buyer’s
assets or the Buyer Common Stock.




(c)           The
Buyer is not in default under, or in violation of any provision of, its
certificate of incorporation, by-laws, or any promissory note, indenture or any
evidence of indebtedness or security thereto, lease, purchase contract or other
commitment or any other agreement which is material to the Buyer.




26




6.4           SEC
Filings.




(a)           The
Buyer has provided or made available to Whitbread and the Seller copies of each
of the periodic reports and other documents filed by the Buyer with the
Securities and Exchange Commission (“SEC”).  The Buyer has filed all
reports, documents and other information required of it to be filed with the SEC
(the “Buyer SEC Reports”).  The Buyer SEC Reports were prepared in
accordance with the requirements of the Securities Act of 1933, as amended (the
“Securities Act”), or the Exchange Act, as the case may be, and the rules and
regulations of the SEC thereunder applicable to such Buyer SEC
Reports.  None of the Buyer’s subsidiaries is required to file any
form, reports or other documents with the SEC.  The Buyer SEC Reports,
at the time they were filed (or if amended or superseded by a filing prior to
the date of this Agreement, then on the date of such later filing) did not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.




(b)           Each
of the consolidated financial statements (including, in each case, any related
notes thereto) contained in the Buyer SEC Reports (the “Buyer Financials”) (x)
complies as to form in all material respects with the published rules and
regulations of the SEC with respect thereto, (y) was prepared in accordance with
GAAP consistently applied throughout the periods involved and (z) fairly
presented the consolidated financial position of the Buyer and its subsidiaries
as at the respective dates thereof and the consolidated results of its
operations and cash flows for the periods indicated..  No other
financial statements (or schedules) of the Buyer or any predecessor of the Buyer
are required by the Securities Act or the Securities Act Rules and Regulations
to be included in the SEC Reports.  Deloitte & Touche (together
with any other nationally recognized accounting firm that the Buyer may from
time to time engage, the “Accountants”), who have reported on the financial
statements and schedules which are audited, are independent accountants with
respect to the Buyer as required by the Securities Act and the Securities Act
Rules and Regulations.




6.5           Related
Party Transactions.  Except as disclosed in the Buyer SEC Reports, no
director, officer or employee of the Buyer is indebted to the Buyer, nor is the
Buyer indebted (or committed to make loans or extend or guarantee credit) to any
such person, nor is any such person a party to any transaction (other than as an
employee) with the Buyer providing for the furnishing of services by, or rental
of real or personal property from, or otherwise requiring cash payments to, any
such person.




6.6           Brokers.  No
Person will have, as a result of the transactions contemplated by this
Agreement, any valid right to, interest in or claim upon the Seller or Whitbread
for any commission, fee or other compensation as a finder or broker because or
any act or omission by Buyer or its Affiliates.




6.7           Filing
and Enforceability of Contracts.  There are no contracts or documents
of a character required to be described in the Buyer SEC Reports that have not
been so described or filed (the “Buyer SEC Contracts”).  All Buyer SEC
Contracts executed and delivered on or before the date hereof to which the Buyer
or any subsidiary of the Buyer is a party have been duly authorized, execution
and delivery thereof by the Buyer or such subsidiary and, assuming due
authorization, execution and delivery thereof by the other parties thereto,
constitute valid and binding agreements of the other parties thereto,
enforceable against such parties in accordance with the terms thereof, subject
to the Enforceability Limitations.




6.8           No
Integration of Offerings or General Solicitation.  The Buyer has not,
directly or indirectly, solicited any offer to buy or offered to sell, and will
not, directly or indirectly, solicit any offer to buy or offer to sell, in the
United States or to any United States citizen or resident, any security which is
or would be integrated with the sale of the Buyer Stock to the Seller pursuant
to this Agreement in a manner that would require such Buyer Stock to be
registered under the Securities Act.  None of the Buyer, its
affiliates (as such term is defined in Rule 501(b) under the Securities Act), or
any person acting on its or any of their behalf has engaged or will engage, in
connection with the offering of such Buyer Stock, in any form of general
solicitation or general advertising within the meaning of Rule 502(c) under the
Securities Act with respect to such Buyer Stock




6.9           No
Material Adverse Change.  Subsequent to the respective dates as of
which information is given in the Buyer SEC Reports, (i) the Buyer and its
subsidiaries, taken as a whole, have not incurred any liabilities or
obligations, direct or contingent, or entered into any transactions (other than,
in each case, in the ordinary course of business consistent with past practice),
that are material to the Buyer and its subsidiaries taken as a whole, and (ii)
there has not been any material change in the capital stock, short-term debt or
long-term debt of the Buyer, and (iii) there has not been any material adverse
change in the condition (financial or other), business, prospects, net worth or
results of operations of the Buyer and its subsidiaries taken as a whole, except
in this clause (iii) for changes and developments that result from broad changes
in the national economy or the economic condition of the regions in which the
Buyer operates.




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ARTICLE
VII.




SURVIVAL
OF REPRESENTATIONS; INDEMNIFICATION




7.1           Survival
of Representations.  All representations and warranties made by any
party to this Agreement in Articles IV, V and VI hereto, as expressly modified
by any Schedule, exhibit, certificate or other document executed and delivered
pursuant hereto shall survive the Closing and any investigation made by or on
behalf of any party hereto for a period of eighteen months following the Closing
Date; provided, however, that the representations and warranties contained in
Section 4.1 (Organization; Qualification and Capital Stock; Corporate Records),
Section 6.1 (Organization, Existence and Capital Stock), Section 5.1(c)
(Shareholder Power and Authorization; Ownership), Section 4.8 (Tax Matters) and
4.11 (Employee Matters; Benefit Plans; ERISA) shall survive the Closing and any
investigations made by or on behalf of the relevant party until expiration of
the applicable statute of limitations.  All statements contained
herein or in any schedule, exhibit, certificate or other document executed and
delivered pursuant hereto shall be deemed representations and warranties for
purposes of Sections 7.1, 9.2(a), and 9.3(a).  Notwithstanding the
foregoing, the covenants and agreements of the Buyer and the Seller made herein
shall survive the Closing and shall continue in full force and effect
indefinitely.  The right to indemnification or other remedy based upon
such representations and warranties shall not be affected by any investigation
conducted with respect to, or any knowledge acquired at any time, whether before
or after execution and delivery of this Agreement or the Closing Date, with
respect to the accuracy or inaccuracy of any such representation or
warranty.  Each of the Buyer, Whitbread and the Seller shall notify
the other parties in writing of the actual discovery of any inaccuracy in any
representation or warranty of any party hereto.




7.2           Indemnification.




(a)           Subject
to the terms and conditions of this Article VII, following the Closing, the
Seller shall indemnify, defend and hold harmless the Buyer and Whitbread (and
their respective officers, directors, employees, Affiliates, successors or
assigns other than the Seller) (collectively, the “Buyer Indemnified Parties”),
from and against all Claims, assessments, losses, damages, liabilities,
deficiencies, judgments, settlements, costs and expenses, including interest,
penalties and reasonable attorneys’ fees and expenses incurred in enforcing this
indemnification or in any litigation between the parties or with third parties
(collectively, “Damages”) asserted against, resulting from, imposed upon,
suffered or incurred by a Buyer Indemnified Party, directly or indirectly, by
reason of or resulting from a breach of any representation, warranty, covenant
or agreement of Whitbread or the Seller contained in or made pursuant to this
Agreement or any of the Related Agreements.




(b)           Subject
to the terms and conditions of this Article VII, following the Closing, the
Buyer shall indemnify, defend and hold harmless the Seller (and his respective
heirs, representatives and assigns) (collectively, the “Whitbread Indemnified
Parties”) at any time after consummation of the Closing, from and against all
Damages asserted against, resulting to, imposed upon or incurred by the
Whitbread Indemnified Parties, directly or indirectly, by reason of or resulting
from:  (i) the assertion against Seller of any claim for payment or
performance of any obligation, debt, or liability in connection with the Buyer’s
ownership or operation of the Business from and after the Closing, or (ii) a
breach of any representation, warranty, covenant or agreement of the Buyer
contained in or made pursuant to this Agreement or any Related
Agreement.




(c)           The
Seller’s maximum liability to the Buyer Indemnified Parties for Damages under
Section 7.2(a) shall not exceed the aggregate Purchase Price received by the
Seller as of the Determination Date (the “Maximum Whitbread Indemnification
Amount”); provided, that the indemnification liability shall be satisfied solely
by cash payment and by cancellation of shares of Buyer Stock issued to him in
the same proportion that the cash and Buyer Stock comprise the Purchase Price as
of the Determination Date.  The Determination Date shall mean the date
on which it is determined that the Seller owes such indemnification obligation
to Buyer.




(d)           The
Buyer’s maximum liability to the Whitbread Indemnified Parties for Damages under
Section 7.2(b) shall not exceed the Purchase Price received by or, if greater,
payable to the Seller on the date on which it is determined that Buyer owes such
indemnification obligation to the Seller.




28




(e)           The
Seller shall not be liable to the Buyer Indemnified Parties, and the Buyer shall
not be liable to the Whitbread Indemnified Parties, unless the aggregate Damages
for which a party is responsible for under Section 7.2 shall exceed $50,000,
after which such responsible party is liable only for the excess amount of such
Damages (the “Basket Amount”).




(f)           The
Basket Amount shall not apply in respect of any Damages with respect to the
breach by Whitbread of any representation or warranty made by Whitbread or the
Seller in Sections 4.8, 4.11 and 4.12 (with respect to claims relating to the
subject matter addressed in the foregoing excluded representations and
warranties).




(g)           The
amount of any Damages for which indemnification is provided under this Article
VII shall be reduced by any related recoveries to which the Indemnified Party is
entitled under insurance policies or other related payments received or
receivable from third parties and any tax benefits actually received by the
Indemnified Party or for which the Indemnified Party is eligible on account of
the matter resulting in such Damages or the payment of such
Damages.




(h)           Except
as expressly set forth herein, neither the Buyer, Whitbread nor the Seller shall
have any right to off-set or set-off any payment due pursuant to this Agreement
against any other payment to be made pursuant to this Agreement or otherwise
(including against indemnification payments).




7.3           Conditions
of Indemnification.




(a)           Third-Party
Claims.  All claims for indemnification made under this Agreement
resulting from, related to or arising out of a third-party claim against an
Indemnified Party (as defined below) shall be made in accordance with the
following procedures.  A person entitled to indemnification under this
Article VII (an “Indemnified Party”) shall give prompt written notification to
the person from whom indemnification is sought (the “Indemnifying Party”) of the
commencement of any action, suit or proceeding relating to a third-party claim
for which indemnification may be sought or, if earlier, upon the assertion of
any such claim by a third party.  Within 30 days after delivery of
such notification, the Indemnifying Party may, upon written notice thereof to
the Indemnified Party, assume control of the defense of such action, suit,
proceeding or claim with counsel reasonably satisfactory to the Indemnified
Party.  If the Indemnifying Party does not assume control of such
defense, the Indemnified Party shall control such defense.  The Party
not controlling such defense may participate therein at its own expense;
provided that if the Indemnifying Party assumes control of such defense and the
Indemnified Party reasonably concludes, based on advice from counsel, that the
Indemnifying Party and the Indemnified Party have conflicting interests with
respect to such action, suit, proceeding or claim, the reasonable fees and
expenses of counsel to the Indemnified Party solely in connection therewith
shall be considered “Damages” for purposes of this Agreement; provided, however,
that in no event shall the Indemnifying Party be responsible for the fees and
expenses of more than one counsel for all Indemnified Parties.  The
Party controlling such defense shall keep the other Party advised of the status
of such action, suit, proceeding or claim and the defense thereof and shall
consider recommendations made by the other Party with respect
thereto.  The Indemnified Party shall not agree to any settlement of
such action, suit, proceeding or claim without the prior written consent of the
Indemnifying Party.  The Indemnifying Party shall not agree to any
settlement of such action, suit, proceeding or claim that does not include a
complete release of the Indemnified Party from all liability with respect
thereto or that imposes any liability or obligation on the Indemnified Party
without the prior written consent of the Indemnified Party, which shall not be
unreasonably withheld, conditioned or delayed.




(b)           Non-third
Party Claims.  An Indemnified Party wishing to assert a claim for
indemnification under this Article VII which is not subject to Section 7.3(a)
shall deliver to the Indemnifying Party a written notice (a “Claim Notice”)
which contains (i) a description and the amount (the “Claimed Amount”) of any
Damages incurred by the Indemnified Party, (ii) a statement that the Indemnified
Party is entitled to indemnification under this Article VII and a reasonable
explanation of the basis therefor, and (iii) a demand for payment in the amount
of such Damages.  Within 30 days after delivery of a Claim Notice, the
Indemnifying Party shall deliver to the Indemnified Party a written response in
which the Indemnifying Party shall:  (I) agree that the Indemnified
Party is entitled to receive all of the Claimed Amount (in which case such
response shall be accompanied by a payment by the Indemnifying Party to the
Indemnified Party of the Claimed Amount, by check or by wire transfer), (II)
agree that the Indemnified Party is entitled to receive part, but not all, of
the Claimed Amount (the “Agreed Amount”) (in which case such response shall be
accompanied by a payment by the Indemnifying Party to the Indemnified Party of
the Agreed Amount), or (III) contest that the Indemnified Party is entitled to
receive any of the Claimed Amount.  If the Indemnifying Party in such
response contests the payment of all or part of the Claimed Amount, the
Indemnifying Party and the Indemnified Party shall use good faith efforts to
resolve such dispute.  If such dispute is not resolved within 60 days
following the delivery by the Indemnifying Party of such response, the
Indemnifying Party and the Indemnified Party shall each have the right to submit
such dispute to a court of competent jurisdiction in accordance with the
provisions of Section 10.4.  Buyer shall, at Buyer’s election, be
entitled to offset any claims for Damages hereunder, pro tanto, against the
remaining Contingent Cash Payments and the remaining Contingent Stock
Payments.




29




7.4           Exclusive
Remedies.  Except with respect to claims based on actual fraud, the
rights of the Indemnified Parties under this Article VII shall be the sole and
exclusive remedies of the Indemnified Parties and their respective affiliates
with respect to claims resulting from or relating to any misrepresentation,
breach of warranty or failure to perform any covenant or agreement contained in
this Agreement or otherwise relating to the transactions that are the subject of
this Agreement.  Without limiting the generality of the foregoing
three sentences, in no event shall Buyer, its successors or permitted assigns be
entitled to claim or seek rescission of the transactions consummated under this
Agreement.  The foregoing, shall not, however, limit or restrict a
party’s right to seek injunctive relief.




ARTICLE
VIII.




COVENANTS.




8.1           Public
Disclosures.  The Buyer and Whitbread will consult with each other
before issuing any press release or otherwise making any public statement with
respect to the transactions contemplated by this Agreement, and shall not issue
any such press release or make any such public statement prior to such
consultation except as may be required by applicable law or requirements of
NASDAQ.  The parties shall issue a joint press release, mutually
acceptable to Whitbread and the Buyer, promptly upon execution and delivery of
this Agreement.




8.2           Confidentiality.  The
Buyer, Whitbread and the Seller shall hold, and shall use their best efforts to
cause their respective auditors, attorneys, financial advisors, bankers and
other consultants and advisors to hold in strict confidence, unless compelled to
disclose by judicial or administrative process or by other requirements of law,
all documents and information concerning the other party furnished to it by the
other party or its representatives in connection with the transactions
contemplated by this Agreement, including, without limitation, the terms and
conditions of the Agreement (except to the extent that such information shall be
shown to have been (a) already known by the party to which it was furnished, (b)
in the public domain through no fault of such party or (c) later lawfully
acquired from other sources by the party to which it was furnished)
(“Confidential Information”), and each party shall not release or disclose such
Confidential Information to any other Person, except its auditors, attorneys,
financial advisors, bankers and other consultants and advisors in connection
with the transactions contemplated by this Agreement.




8.3           Stock
Options Plan.




(a)           After
the Closing, the Buyer shall reserve options to purchase a number shares of
Buyer Stock equal to the product of the Baseline EBITDA and 0.2 (each, a “Buyer
Option”) for employees of Whitbread following the Closing.




(b)           The
number of Buyer Options reserved for employees of Whitbread following the
Closing shall be increased by 0.2 Buyer Options for each $1.00 that the EBITDA
generated by Whitbread following the Closing during the first Performance Period
exceeds the Baseline EBITDA for the first Performance Period, such increase to
become effective within 30 days of the delivery of the Annual Financial
Statements pursuant to Section 8.4 hereof.




(c)           All
material terms and conditions of the Buyer Options, including the expiration
dates and vesting schedules, shall be determined by the Executive Committee of
the Buyer, subject to ratification by the Board of Directors of the
Buyer.




30




(d)           The
Executive Committee of the Buyer shall review on an annual basis the number of
Buyer Options available for grant to Whitbread’s employees and reserve
additional Buyer Options for grant to Whitbread’s employees if the Executive
Committee shall determine, in its sole discretion, that reservation of
additional Buyer Options is appropriate.




8.4           Performance
Period Financial Statements.  Buyer will deliver to Whitbread and the
Seller:  (i) within sixty (60) days after the end of each Performance
Period, a copy of the balance sheet of Whitbread as of the end of such
Performance Period, together with consolidated and consolidating statements of
income and of cash flows of Whitbread for such Performance Period, all in
reasonable detail, prepared in accordance with GAAP, consistently applied and in
a manner consistent with past practices, and certified in an audit report by
independent public accountants of national standing reasonably acceptable to
Whitbread and the Seller (the “Annual Financial Reports”) and (ii) within forty
five (45) days after the end of each of the first three quarters of each
Performance Period, a copy of the unaudited consolidated balance sheet of
Whitbread as of the end of such quarter and unaudited consolidated statements of
income and of cash flows of Whitbread for the fiscal quarter and for the portion
of the fiscal year ending on the last day of such quarter, each of the foregoing
balance sheets and statements to set forth in comparative form with the
corresponding figures for the same period of the prior Performance Period (the
“Quarterly Financial Reports”), prepared in accordance with GAAP consistently
applied and in a manner consistent with past practices (provided, however, that
such Quarterly Financial Reports are subject to year-end adjustments and may not
contain all footnotes required under GAAP).   The Annual
Financial Statements and Quarterly Financial Reports shall set forth the EBITDA
of Whitbread for the subject Performance Period (or quarter thereof) (including
the figures used and calculations made to determine the EBITDA).




8.5           Accounting
Disputes.   Notwithstanding anything to the contrary in this
Agreement, if the Seller has any dispute relating to the determination of Actual
Net Working Capital or the amount of EBITDA or revenue reported on the Closing
Financial Statements or, as to EBITDA or revenue, on any Performance Period
Financial Statement, then the Seller will notify the Buyer, in writing, of each
disputed amount (collectively, the “Disputed Amounts”), specifying the grounds
for such dispute, within 15 Business Days after delivery of such Closing
Financial Statements or Performance Period Financial Statement, as the case may
be.  If the Buyer and the Seller cannot resolve any such dispute
within 10 Business Days after delivery of such notice, then such dispute will be
resolved by an independent accounting firm reasonably acceptable to the Buyer
and the Seller (the “Independent Accounting Firm”).  If the Buyer and
the Seller do not agree upon a mutually acceptable Independent Accounting Firm
within the 10 Business Day period after delivery of the notice, the Buyer and
the Seller will each select an independent accounting firm, and the Independent
Accounting Firm will be selected by the firms chosen by the Buyer and the
Seller.  The determination of the Independent Accounting Firm (i) will
be made as promptly as practicable; (ii) will be prepared in accordance with
GAAP and this Agreement; and (iii) will be final and binding on the parties,
absent manifest error, which error may only be corrected by such Independent
Accounting Firm.  Any expenses relating to the engagement of the
Independent Accounting Firm will be allocated evenly between the Buyer and the
Seller, provided, however, that if the determination of the Independent
Accounting Firm is that an understatement of EBITDA, revenue or Net Working
Capital to the detriment of the Seller has occurred that results in a
restatement of more than 10% of the EBITDA or 5 % of revenue or Net Working
Capital, then the Buyer shall pay all expenses related to the engagement of the
Independent Accounting Firm.  Upon reasonable notice from Seller,
Buyer will make available to Seller and its representatives all books, records,
personnel, including auditors work papers, used in connection with the
preparation of and calculations and accounting methods used in connection with
the Performance Period Financial Statements.




8.6           Audit;
Cooperation.  Following the Closing, and consistent with the
provisions of Section 3.1 hereof, the Seller shall cooperate with the Buyer and
Whitbread, at the Buyer’s sole expense, in connection with the Buyer’s
preparation of financial statements, and, if necessary, an audit (the “Audit”)
of the financial performance of Whitbread, for all periods required in
connection with the Buyer’s reporting obligations under the United States
securities laws.  Such cooperation shall include, but not be limited
to, providing full access to the Books and Records, any work papers generated in
connection therewith, Whitbread personnel, Whitbread’s outside auditors and
assisting the Buyer in obtaining any required consent of such outside auditors
in connection with the Buyer’s reporting obligations under the United States
securities laws.




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8.7           Post
Closing Operations.  From the Closing Date until the earlier of the
third anniversary of the Closing Date or the full payment of the Contingent Cash
Payment and Contingent Stock Payment for each Performance Period, the Buyer
shall:




(a)           maintain
separate books and accounts for Whitbread; and




(b)           operate
Whitbread as an information technology services business.




8.8           Election
Under Section 338(h)(10).  The Buyer and the Seller shall jointly make
an election under Section 338(h)(10) of the Code (and any comparable election
under state, local, or foreign tax law) with respect to the acquisition of
Whitbread by the Buyer.  The Buyer and the Seller shall cooperate
fully with each other in the making of such election.  The Seller and
the Buyer shall on the Closing Date exchange completed and executed copies of
Internal Revenue Service Form 8023, required schedules thereto, and any similar
state and foreign form (each a “Section 338 Form”).  If any changes
are required to any Section 338 Form as a result of information that is first
available after the Closing Date, the parties shall promptly agree on and take
appropriate action to affect such changes.  For allocation purposes,
the Purchase Price shall be allocated as mutually agreed by Buyer and the
Seller.  Such allocation shall be used for purposes of reporting the
deed sale of assets of the Company in connection with the Section 338(h)(10)
election.  As a condition to Seller’s agreement to making the election
under Section 338(h)(10) of the Code (and any comparable election under state,
local, or foreign tax law), Buyer shall pay to Seller, in cash, the Excess
Amount in accordance with the terms hereof.  “Excess Amount” shall
mean the amount equal to the excess, if any, of (a) the Seller’s anticipated
individual income tax for 2005 based upon his election under Section 338(h)(10)
of the Code with respect to the treatment of the transactions described in this
Agreement, over (b) Seller’s anticipated individual income tax for 2005
calculated as if Seller had not made such election, as reasonably determined by
Seller.  Payment shall be made within fifteen (15) days of Buyer’s
receipt of Seller’s accountant’s calculation of such Excess Amount.




8.9           Transfer
of Lease.  As soon as reasonably practicable following Closing,
Whitbread shall assign the lease for the automobile currently provided for use
by the Seller to the Seller and, from and after the Closing Date, the Seller
shall be responsible for any and all obligations under such lease, including all
amounts due and payable under such lease.




ARTICLE
IX.




CONDITIONS
TO CLOSING.




9.1           Mutual
Conditions.  The respective obligations of each party to effect the
transactions contemplated by this Agreement shall be subject to the
satisfaction, at or prior to the Closing Date, of the following conditions (any
of which may be waived in writing by the Buyer, the Seller and
Whitbread).




(a)           None
of the Buyer, the Seller or Whitbread nor any of their respective subsidiaries
shall be subject to any order, decree or injunction by a court of competent
jurisdiction which (i) prevents or materially delays the consummation of the
transactions contemplated by this Agreement or (ii) would impose any material
limitation on the ability of the Buyer effectively to exercise full rights of
ownership of the common stock of Whitbread or any material portion of the assets
or Business of Whitbread, taken as a whole.




(b)           No
statute, rule or regulation, shall have been enacted by the government (or any
governmental agency) of the United States or any state, municipality or other
political subdivision thereof that makes the consummation of the transactions
contemplated by this Agreement illegal.




(c)           The
Buyer, the Seller and Whitbread shall have received all consents, approvals and
authorizations of third parties that are required of such third parties prior to
the consummation of the transactions contemplated by this Agreement, in form and
substance acceptable to the Buyer or Whitbread, as the case may be, except where
the failure to obtain such consent, approval or authorization would not have a
material adverse effect on the Business of Whitbread.




32




9.2           Conditions
to the Obligations of the Buyer.  The obligations of the Buyer under
this Agreement are subject to the satisfaction, at or before the Closing, of
each of the following conditions (any of which may be waived in writing by the
Buyer):




(a)           The
representations and warranties of Whitbread and the Seller contained herein that
are qualified as to materiality shall be true in all material respects on and as
of the Closing Date (except for the representations and warranties made as of a
specific date which shall be true in all material respects as of such date) with
the same force and effect as though made on and as of such date, and each of the
representations and warranties of Whitbread and the Seller that are not so
qualified shall be true in all respects.




(b)           Whitbread
and the Seller shall have performed and complied in all material respects with
all covenants, agreements, obligations and conditions required by this Agreement
to be performed or complied with by them at or prior to the
Closing.




(c)           There
shall not be threatened, instituted or pending any suit, action, investigation,
inquiry or other proceeding by or before any court or governmental or other
regulatory or administrative agency or commission requesting or looking toward
an order, judgment or decree that (a) restrains or prohibits the consummation of
the transactions contemplated hereby, (b) could reasonably be expected to have a
material adverse effect on the Buyer’s ability to exercise control over or
manage Whitbread after the Closing or (c) could reasonably be expected to have a
material adverse effect on the Business of Whitbread.




(d)           On
the Closing Date, there shall be no effective injunction, writ, preliminary
restraining order or other order issued by a court of competent jurisdiction
restraining or prohibiting the consummation of the transactions contemplated
hereby.




(e)           Whitbread
shall have delivered to the Buyer a certificate, dated the Closing Date,
executed by the Secretary of Whitbread, certifying as to (i) Whitbread’s
articles of incorporation, (ii) Whitbread’s by-laws, (iii) resolutions with
respect to the transactions contemplated by this Agreement adopted by
Whitbread’s board of directors and shareholders and attached to such
certificate, and (d) incumbency and signatures of the persons who have executed
this Agreement, the Related Agreements and any other documents, certificates and
agreements to be executed and delivered at the Closing pursuant to this
Agreement or any of the Related Agreements on behalf of Whitbread.




(f)           John
Schmottlach and Jeffrey Fay shall have entered into an employment agreement with
Whitbread (the “Employment Agreements”), substantially in the form of Exhibit
B.1, and Joel D’Arcy shall have entered into a non-competition agreement with
the Whitbread substantially in the form of Exhibit B.2 (the “Non-Competition
Agreement”).




(g)           The
Seller shall have entered into a lock-up agreement with the Buyer (the “Lock-up
Agreement”), substantially in the form of Exhibit C.




(h)           Whitbread
shall have furnished the Buyer with copies of the Ownership and Nondisclosure
Agreements signed by each employee, officer, consultant or contractor of
Whitbread identified on Schedule 4.15(g).




(i)           Whitbread
shall have furnished the Buyer with copies of the Option Waivers, which provide
for the cancellation of all of the outstanding options to purchase
Shares.




(j)           The
Buyer shall have received resignations in form and substance satisfactory to the
Buyer from the directors and officers of Whitbread listed on Schedule 9.2(j),
which shall include a release of all Claims against Whitbread.




33




9.3           Conditions
to the Obligations of Whitbread and the Seller.  The obligations of
Whitbread and the Seller under this Agreement are subject to the satisfaction,
at or before the Closing, of each of the following conditions (any of which may
be waived in writing by Whitbread and the Seller):




(a)           The
representations and warranties of the Buyer contained herein that are qualified
as to materiality shall be true in all respects on and as of the Closing Date
(except for the representations and warranties made as of a specific date which
shall be true in all material respects as of such date) with the same force and
effect as though made on and as of such date, and each of the representations
and warranties of the Buyer that are not so qualified shall be true in all
respects.




(b)           The
Buyer shall have performed and complied in all material respects with all
covenants, agreements, obligations and conditions required by this Agreement to
be so performed or complied with by the Buyer at or prior to the
Closing.




(c)           There
shall not be threatened, instituted or pending any suit, action, investigation,
inquiry or other proceeding by or before any court or governmental or other
regulatory or administrative agency or commission requesting or looking toward
an order, judgment or decree that (a) restrains or prohibits the consummation of
the transactions contemplated hereby or (b) could reasonably be expected to have
a material adverse effect on the business of the Buyer or Whitbread (following
the Closing).




(d)           On
the Closing Date, there shall be no effective injunction, writ, preliminary
restraining order or other order issued by a court of competent jurisdiction
restraining or prohibiting the consummation of the transactions contemplated
hereby.




(e)           The
Buyer shall have delivered to the Seller a certificate, dated the Closing Date,
executed by the Secretary of Buyer, certifying as to (i) Buyer’s articles of
incorporation, (ii) Buyer’s by-laws, (iii) resolutions with respect to the
transactions contemplated by this Agreement adopted by Buyer’s board of
directors and attached to such certificate, and (d) incumbency and signatures of
the persons who have executed this Agreement, the Related Agreements and any
other documents, certificates and agreements to be executed and delivered at the
Closing pursuant to this Agreement or any of the Related Agreements on behalf of
Buyer.




ARTICLE
X.




MISCELLANEOUS




10.1           Notices.  Any
communications required or desired to be given hereunder shall be deemed to have
been properly given if sent by hand delivery or by facsimile and overnight
courier or overnight courier to the parties hereto at the following addresses,
or at such other address as either party may advise the other in writing from
time to time:




If
      to Buyer:




Zanett,
      Inc.


135
      East 57th Street


15th
      Floor


New
      York, NY  10022


Attention:  Pierre-Georges
      Roy, Chief Legal Officer




As
      of April 1, 2005


Zanett
      Inc.


635
      Madison Avenue, 15th Floor


New
      York, NY 10022


Attn:  Pierre-Georges
      Roy, Chief Legal Officer


Fax:  (212)
      753-5304




with
      a copy to (which shall not constitute
notice):




Drinker,
      Biddle & Reath, LLP


One
      Logan Square


18th
      and Cherry Streets


Philadelphia,
      PA  19103


Attention:  Stephen
      Burdumy




34




If
      to Seller:




Joel
      D’Arcy


66
      Bickford Road, Gilford, NH 03249




with
      a copy to (which shall not constitute
  notice):


Stefan
      Vounessea, Esq.


Carroll
      & Vounessea, LLP


Three
      Essex Green Drive


Suite
      5


Peabody,
      Massachusetts 01960


Phone:  978-532-9370


Fax:  978-532-4188




If
      to Whitbread:




Whitbread
      Technology Partners, Inc.


67
      Montvale Avenue, Suite 301


Stoneham,
      MA 02180


Phone:  (617)
      966-5152


Fax:  (781)
      994-0101




with
      a copy to (which shall not constitute
notice):




Zanett,
      Inc.


135
      East 57th Street


15th
      Floor


New
      York, NY  10022


Attention:  Pierre-Georges
      Roy, Chief Legal Officer




As
      of April 1, 2005


Zanett
      Inc.


635
      Madison Avenue, 15th Floor


New
      York, NY 10022


Attn:  Pierre-Georges
      Roy, Chief Legal Officer


Fax:  (212)
      753-5304




All such
communications shall be deemed to have been delivered on the date of hand
delivery or facsimile or on the next Business Day following the deposit of such
communications with the overnight courier.




10.2           Further
Assurances.  Each party hereby agrees to perform any further acts and
to execute and deliver any documents which may be reasonably necessary to carry
out the provisions of this Agreement.




10.3           Governing
Law.  This Agreement shall be interpreted, construed and enforced in
accordance with the laws of the State of Delaware, applied without giving effect
to any conflicts of law principles.




10.4           Consent
to Jurisdiction.  Each of the parties hereto (a) consents to submit
itself to the personal jurisdiction of any Federal court located in the State of
New York in the event any dispute arises out of this Agreement or any of the
transactions contemplated by this Agreement, (b) agrees that it will not attempt
to deny or defeat such personal jurisdiction by motion or other request for
leave from any such court, and (c) agrees that it will not bring any action
relating to this Agreement or any of the transactions contemplated by this
Agreement in any court other than a Federal court sitting in the State of New
York.




10.5           Integration
of Exhibits and Schedules.  All Exhibits and Schedules to this
Agreement are integral parts of this Agreement as if fully set forth
herein.




35




10.6           Entire
Agreement.  This Agreement, the Related Agreements, including all
Exhibits and Schedules attached hereto and thereto contain the entire agreement
of the parties and supersede any and all prior or contemporaneous agreements
between the parties, written or oral, with respect to the transactions
contemplated hereby.  Such agreement may not be changed or terminated
orally, but may only be changed by an agreement in writing signed by the party
or parties against whom enforcement of any waiver, change, modification,
extension, discharge or termination is sought.




10.7           Expenses.  Except
as expressly provided otherwise, each party hereto will bear its own costs and
expenses (including fees and expenses of auditors, attorneys, financial
advisors, bankers, brokers and other consultants and advisors) incurred in
connection with this Agreement, the Related Agreements and the transactions
contemplated hereby and thereby.




10.8           Counterparts.  This
Agreement may be executed in several counterparts, each of which, when so
executed, shall be deemed to be an original, and such counterparts shall
together constitute and be one and the same instrument.




10.9           Binding
Effect.  This Agreement shall be binding on, and shall inure to the
benefit of, the parties hereto, and their respective successors and assigns, and
no other person shall acquire or have any right under or by virtue of this
Agreement.  No party may assign any right or obligation hereunder
without the prior written consent of the other parties.




[SIGNATURE
PAGE FOLLOWS]




36


IN
WITNESS WHEREOF, the Buyer, Whitbread and the Seller have caused this Stock
Purchase Agreement to be executed by their respective duly authorized officers,
all as of the day and year first above written.




ZANETT,
      INC.By:
              /s/
      Pierre-Georges RoyName:  Pierre-Georges
      RoyTitle:  Chief
      Legal OfficerWHITBREAD
      TECHNOLOGY PARTNERS, INC.By:
              /s/
      Joel D’ArcyName:  Joel
      D’ArcyTitle:  Chief
      Executive OfficerTHE
      SELLER/s/ Joel
      D’ArcyJoel
      D’Arcy




37