EXECUTION
        VERSION

       

    

    
      FIRST
        AMENDMENT TO STOCK PURCHASE AGREEMENT

       

      THIS
        FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT
        (this
        "Amendment"),
        dated
        as of December 28, 2006 to be effective as of December 2, 2006 (the
        "Effective
        Date"),
        by
        and among Manchester Indiana Operations, Inc., a Delaware corporation
        ("Indiana
        Operations")
        and
        Manchester Indiana Acceptance, Inc., a Delaware corporation ("Indiana
        Acceptance",
        and,
        together with Indiana Operations, each a "Purchaser,"
        and
        collectively, the "Purchasers"),
        Manchester Inc., a Nevada corporation ("Parent"),
        each
        of the persons identified on Schedule
        4.2.1
        to the
        Stock Purchase Agreement (each a "Seller,"
        and
        collectively, "Sellers"),
        and
        on behalf of himself and each Seller, Rick Stanley ("Sellers'
        Representative").

       

      WITNESSETH:

       

      WHEREAS,
the
        Purchasers, Parent, and Sellers, (collectively, the "Parties")
        previously entered into that certain Stock Purchase Agreement, dated December
        2,
        2006, whereby the Purchasers agreed to purchase, and the Sellers agreed to
        sell,
        all of the issued and outstanding capital stock of each of F.S. English,
        Inc.,
        an Indiana corporation, and GNAC, Inc., an Indiana corporation, on the terms
        and
        conditions set forth therein (the "Stock
        Purchase Agreement");
        

       

      WHEREAS,
        the
        Parties desire to amend certain provisions in the Stock Purchase Agreement
        as
        set forth herein; 

       

      WHEREAS,
        all
        capitalized terms used but not otherwise defined herein shall have the
        respective meanings set forth in the Stock Purchase Agreement;

       

      NOW,
        THEREFORE,
        in
        consideration of the foregoing and the mutual covenants and promises contained
        herein and in the Stock Purchase Agreement and other good and valuable
        consideration, the receipt and sufficiency of which are hereby acknowledged,
        the
        parties hereto intending to be legally bound,
        hereby agree as follows:

       

      AGREEMENT

       

      Section
        1.01. 
Amendments.
        

       

       
        (a)  Section
        2.2
        of the
        Stock Purchase Agreement is hereby deleted in its entirety and replaced with
        the
        following:

       

      "
        2.2  
Purchase
        Price. 

       

        
        The aggregate consideration paid to the Sellers in exchange for the Shares
        shall
        be as follows: 

       

      (a)  
        Three
        Million U.S. Dollars ($3,000,000.00) in the form of a promissory note in
        favor
        of Sellers substantially in the form attached hereto as Schedule 2.2(a) (the
        "Seller
        Note");
        and

       

      (b)   Such
        number of shares of common stock of Parent, par value $.001 per share,
        representing an aggregate amount equal to Three Million U. S. Dollars
        ($3,000,000.00) as determined by reference to the average of the closing
        prices
        of the common stock of Parent on the five (5) business days immediately
        preceding the Closing (the "Manchester
        Shares"
        and
        referred to collectively together with the Seller Note as the "Acquisition
        Consideration")."

       

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

       

        
        (b)     Section
        2.4(a)
        of the
        Stock Purchase Agreement is hereby deleted in its entirety and replaced with
        the
        following:

       

         
        "(a)   Except
        as
        provided in Section 2.4(b), at the Closing, the Purchasers shall (i) on behalf
        of the Acquired Companies, cause the Net Indebtedness to be repaid in full
        to
        the party or parties entitled thereto pursuant to the Payoff Letters, (ii)
        on
        behalf of Sellers, pay the Selling Expenses to the parties entitled thereto
        as
        set forth on a statement delivered by Sellers’ Representative to the Purchasers
        at Closing, and (iii) cause each personal guarantee of any Seller of any
        Indebtedness to be released. Notwithstanding the foregoing, the furniture
        and
        fixtures line of credit with First Indiana Bank in the outstanding amount
        of
        $775,705.34 (as of December 27, 2006) will not be paid off at
        Closing."

       

        (c)  Section
        2.4(b)
        of the
        Stock Purchase Agreement is hereby deleted in its entirety and replaced with
        the
        following:

       

         
        "(b)   Notwithstanding
        Section
        2.4(a)
        above,
        certain Indebtedness held by Sellers' Representative in the amount of $500,000
        (the "Subordinated
        Debt")
        shall
        not be repaid in full; instead, $300,000 of such Subordinated Debt shall
        be paid
        at Closing and $150,000 of such Subordinated Debt shall be refinanced with
        the
        issuance of a promissory note in favor of Sellers' Representative with an
        aggregate principal amount of One Hundred Fifty Thousand U.S. Dollars
        ($150,000.00) in the form attached hereto as Schedule
        2.4(b)
        (the
        "Subordinated
        Note")."

       

       (d)  Section
        6.1
        of the
        Stock Purchase Agreement is hereby amended as follows:

       

      (i)  The
        delivery in Section
        6.1(h)
        is
        hereby waived. 

       

      (ii)   
         The
        delivery in Section
        6.1(k)
        is
        hereby waived. As a condition of such waiver, Purchasers and Sellers'
        Representative shall negotiate in good faith to deliver executed lease
        agreements for the Leased Real Property on or before thirty (30) days after
        the
        Closing and such lease agreements shall be acceptable in form and substance
        to
        Purchasers and the landlord thereof and shall contain, among other things,
        the
        following terms: (a) the monthly rent under each lease agreement shall be
        comprised only of landlord's carrying costs on each Leased Real Property,
        including taxes, insurance and maintenance expenses, and an amount sufficient
        to
        cover any and all income tax liability of landlord relative to rental income
        on
        the Leased Real Property; provided, however, that the final monthly rent
        complies with any loan document covenants with First Indiana Bank applicable
        to
        the Lease Real Property; and (b) in the event that Sellers' Representative
        does
        not receive the salary payments under his employment agreement with Indiana
        Operations and Sellers' Representative is not in breach thereof, the monthly
        rent due under the lease agreements shall be increased by the amount of such
        salary payments owed to Sellers' Representative under the employment
        agreement;

       

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

       

       (iii)  The
        delivery in Section
        6.1(l)
        is
        hereby waived. Sellers acknowledge that Ice Miller LLP is the only service
        provider participating in the negotiation, preparation and/or consummation
        of
        this transaction and Sellers shall be solely responsible for payment of the
        fees
        of Ice Miller LLP.

       

       (iv)  The
        delivery in Section
        6.1(o)
        is
        hereby waived.

       

       
        (v)  The
        delivery in Section
        6.1(q)
        is
        hereby waived.

       

      (e)  Section
        6.2(m)
        of the
        Stock Purchase Agreement is hereby waived.

       

      (f)  
        The date
        "December 8, 2006" in Section
        6.3
        and
Section
        6.4
        is
        hereby deleted and replaced with "December 29, 2006".

       

      (g)  Section
        6.6
        is
        deleted in its entirety and is hereby amended as follows:

       

      “(a)  
        Seller's Representative shall deliver to Purchasers on or prior to the Closing
        Date, written notice of supplemental information updating the information
        set
        forth in the representations and warranties of Sellers set forth in Article
        IV
        of this Agreement so that such representations and warranties of Sellers,
        as
        supplemented by such information, will be true and correct as of the Closing
        Date (the "Sellers
        Disclosure Schedule Updates").
        

       

      (b)   Purchasers
        and Parent may deliver to Seller's Representative, on or prior to the Closing
        Date, written notice of supplemental information updating the information
        set
        forth in the representations and warranties of Purchasers and Parent, set
        forth
        in Article V of this Agreement so that such representations and warranties
        of
        Sellers, as supplemented by such information, will be true and correct as
        of the
        Closing Date (the "Manchester
        Disclosure Schedule Updates"
        and
        referred to herein with the Sellers Disclosure Schedule Updates, each as
        "Disclosure
        Schedule Updates").

       

      (c)  
        If any Disclosure Schedule Updates reflect an occurrence which could reasonably
        be expected to cause the delivering party to recognize or accrue previously
        undisclosed liabilities which individually or in the aggregate are more than
        $50,000.00, the other party shall have the right to terminate this Agreement
        pursuant to and in accordance with Section 6.4 of this Agreement by delivering
        a
        written notice of such termination to the other party prior to the Closing
        in
        accordance with Section 11.1."

       

      Section
        1.02.  No
        Other Amendment.
        Other
        than as specifically amended herein, the Stock Purchase Agreement shall remain
        in full force and effect hereafter without modification. 

       

      Section
        1.03.  Counterparts;
        Facsimile Signature.
        This
        Amendment may be executed in multiple counterparts, each of which will be
        considered an original, but all of which shall constitute one and the same
        Amendment. Facsimile signatures of original signatures shall be deemed original
        signatures. Only one counterpart of this Amendment executed by the party
        against
        which it will be enforced need be provided to evidence this
        Amendment.

       

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

       

      Section
        1.04.  Notices.
        All
        notices to be delivered relating to this Amendment shall be made in the manner
        set forth in Section
        11.1
        of the
        Stock Purchase Agreement. 

       

      Section
        1.05.  Drafting.
        No
        party shall be deemed to be the drafter of this Amendment and in the event
        this
        Amendment is ever construed by a court of law, such court of law shall not
        construe this Amendment or any provision thereof against any of the parties
        as
        the drafter of this Agreement. The Purchasers, the Sellers, the Parent, and
        the
        Shareholder acknowledge and agree that all of the parties have contributed
        substantially and materially to the preparation of this Amendment.

       

      Section
        1.06.  Entire
        Agreement.
        This
        Amendment constitutes the entire understanding between the parties hereto
        with
        respect to the subject matter contained herein and supersedes all prior
        agreements, promises, understanding, communications, whether oral or written,
        by
        any party hereto; provided, however, the Stock Purchase Agreement shall remain
        in full force and effect without modification except as modified by this
        Amendment. 

       

      [SIGNATURE
        PAGE FOLLOWS]

      
 

      
        
          
          

        

        
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      IN
        WITNESS WHEREOF,
        the
        parties hereto have duly executed this Amendment as of December 28, 2006,
        to be
        effective as of the Effective Date.

       

      
        
          	MANCHESTER
                  INDIANA OPERATIONS, INC.
	 	 	 	 
	By:	 	 	 
	 	Name: Richard D. Gaines	 	 
	 	
                  Title:
                    President

                	 	 


        

      

       

      
         

        
          
            	MANCHESTER
                    INDIANA ACCEPTANCE, INC.
	 	 	 	 
	By:	 	 	 
	 	Name: Richard D. Gaines	 	 
	 	
                    Title:
                      President

                  	 	 


          

        

         

        
           

          
            
              	MANCHESTER
                      INC.
	 	 	 	 
	By:	 	 	 
	 	Name: Richard D. Gaines	 	 
	 	
                      Title:
                        Corporate Secretary

                    	 	 


            

          

           

          
             

            
              
                	 F.S.
                        ENGLISH, INC.
	 	 	 	 
	By:	 	 	 
	 	Name: 	 	 
	 	
                        Title:
                          

                      	 	 


              

            

             

          

        

      

      
        
           

          
            
              	GNAC,
                      INC.
	 	 	 	 
	By:	 	 	 
	 	Name: 	 	 
	 	
                      Title:
                        

                    	 	 


            

          

           

        

      

      
        
           

          
            
              	
                      SELLERS’
                        REPRESENTATIVE

                    
	 	 	 	 
	 	 
	 	 
	 	Rick Stanley	 	 
	 	
                       

                    	 	 


            

          

           

        

        
           

        

      

       

      
        
          
          

        

        
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                          SELLERS:

                        
	 	 	 
	 
	 	 
	Rick Stanley	 	 
	
                           

                        	 	 
	 	 	 
	Blake A. Jackson	 	 
	 	 	 
	 
	 	 
	 Wesley E. Jackson	 	 
	 	 	 
	 	 	 
	 Kyle
                          E. Jackson	 	 
	 	 	 
	 	 	 
	Ken Beabout	 	 
	 	 	 
	 
	 	 
	Anthony W. Hamlin	 	 
	 	 	 
	 
	 	 
	William Hatch	 	 
	 	 	 
	 
	 	 
	Ivan Poor	 	 
	 	 	 
	 
	 	 
	Todd A. Simerman	 	 


                

              

               

            

          

          
            
               

              
                
                  	 EJJ6900
                          LLC
	 	 	 	 	 
	 	By:	 	 	 
	 	 	Name: 	 	 
	 	 	
                          Title:
                            

                        	 	 


                

              

               

            

             

            
              
                
                

              

              
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