Document:

Unassociated Document

    Exhibit
      10.1

     

    STOCK
      PURCHASE AGREEMENT

     

    dated
      as of

     

     

    August
      28, 2007

     

     

    between

     

     

    GRANTECH
      AVIATION INC

     

     

    and

     

     

    HARVARD
      HOLDINGS INTERNATIONAL, INC.

     

     

    relating
      to the purchase and sale

     

     

    of

     

     

    39%
      of the Common Stock

     

     

    of

     

     

    GRANTECH
      AVIATION INC

     

    
      
        
        

      

      
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    STOCK
      PURCHASE AGREEMENT

     

    THIS
      STOCK PURCHASE AGREEMENT (this “Agreement”) is dated as of
      August 28, 2007, by and between HARVARD HOLDINGS INTERNATIONAL, INC. a Delaware
      corporation (“Buyer”) and . a Florida corporation
      (“Seller”).

     

    W  I  T  N  E  S  S  E  T  H
      :

     

    WHEREAS,
      Seller, is the beneficial owner of the Shares (as defined herein) and desires
      to
      sell the Shares to Buyer, and Buyer desires to purchase the Shares from Seller,
      upon the terms and subject to the conditions hereinafter set forth.

     

    The
      parties hereto agree as follows:

     

    ARTICLE
      1

    Definitions

     

    Section
      1.01  .  Definitions.  (a) The
      following terms, as used herein, have the following meanings:

     

    “Affiliate”
      means, with respect to any Person, any other Person directly or indirectly
      controlling, controlled by or under common control with such
      Person.

     

    “Affiliated
      Group” means, with respect to federal income Taxes, any affiliated
      group of corporations (as defined in Section 1504(a) of the Code) of which
      the
      Company are members and, with respect to any state, local or foreign income,
      franchise or similar income-based Tax, the consolidated, combined or unitary
      group of which the Company is a member.

     

    “Balance
      Sheet” means the audited balance sheet of the Company as of the Balance
      Sheet Date.

     

    “Balance
      Sheet Date” means December 31st,
      2006.

     

    “Business”
      means the business and operations of the Company as such are conducted by the
      Company as of the date hereof.

     

    “Business
      Day” means a day, other than Saturday, Sunday or other day on which
      commercial banks in New York, New York are required by law to
      close.

     

     “Common
      Stock” means the common stock, par value $1.00 per share, of the
      Company.

     

    “Company”
      means GRANTECH AVIATION INC., a Florida corporation.

     

    
      
        
        

      

      
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    “Company
      Intellectual Property Rights” means all Intellectual Property Rights
      owned by, or licensed to, the Company.

     

    “Current
      Assets” means the sum of the Company’s:

     

    (x)
      Accounts Receivable, net of the Allowance for Doubtful Accounts,

     

    (y)
      Spare
      Parts and Supplies; and

     

    (z)
      Prepaid Expenses.

     

    For
      the
      avoidance of doubt, the parties agree that “Current Assets” shall not include
      any amounts included in Closing Cash.

     

    “Current
      Liabilities” means the sum of the Company’s:

     

    (w)
      Payables,

     

    (x)
      Accrued Salaries and Vacation Pay,

     

    (y)
      Accrued Liabilities, and

     

    (z)
      Accrued Taxes.

     

    “ERISA”
      means the Employee Retirement Income Security Act of 1974, as amended and the
      rules and regulations promulgated thereunder.

     

    “ERISA
      Affiliate” means any other entity which would be treated as a single
      employer with the Company under Section 414 of the Code.

     

     “Exchange
      Act” means the Securities Exchange Act of 1934, as amended, and the
      rules and regulations promulgated thereunder.

     

     “GAAP”
      means generally accepted accounting principles in the United
      States.

     

    “Governmental
      Authority” shall mean any federal, state, local or foreign government
      or any subdivision, agency, instrumentality, authority, department, commission,
      board or bureau thereof or any federal, state, local or foreign court, tribunal
      or arbitrator.

     

     “Intellectual
      Property Right” means any trademark, service mark, trade name,
      invention, patent, trade secret, copyright, know how (including any
      registrations or applications for registration of any of the foregoing) or
      any
      other similar type of proprietary intellectual property right.

     

    “Laws”
      means any law, regulation, rule, order, judgment or decree of a Governmental
      Authority.

     

    
      
        
        

      

      
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     “Lien”
      means, with respect to any property or asset, any and all liens, encumbrances,
      charges, security interests, options, mortgages, easements or pledges in respect
      of such property or asset.

     

     “Permitted
      Liens” mean: (i) specific Liens reflected or reserved against in the
      Balance Sheet or disclosed in the notes thereto; (ii) Taxes and general and
      special assessments not in default and payable without penalty or interest
      or
      being contested in good faith; (iii) mechanic’s, materialman’s, carrier’s,
      repairer’s and other similar Liens arising or incurred in the ordinary course of
      business or that are not yet due and payable or are being contested in good
      faith; or (iv) Liens arising or incurred in the ordinary course of business
      since the Balance Sheet Date, which individually or in the aggregate do not
      have
      a Company Material Adverse Effect.

     

    “Person”
      means an individual, corporation, partnership, limited liability company,
      association, trust or other entity or organization, including a government
      or
      political subdivision or an agency or instrumentality thereof.

     

     “Real
      Property” means all real property that is owned or leased by the
      Company.

     

     “SEC”
      means the Securities and Exchange Commission.

     

    “Securities
      Act” means the Securities Act of 1933, as amended, and the rules and
      regulations promulgated thereunder.

     

     “Shares”
      means 1,950 shares of Common Stock of Quantum Cargo & Aviation Services
      Inc.

     

    “Tax”
      means any federal, state, local or foreign income, gross receipts, license,
      payroll, employment, excise, severance, stamp, occupation, premium, windfall
      profits, environmental, unemployment, disability, real property, personal
      property, sales, use, transfer, registration, value added, alternative or add-on
      minimum, estimated or other tax of any kind whatsoever

     

     “Tax
      Audit” shall mean any notice of deficiency, proposed adjustment,
      adjustment, assessment, audit, examination or other administrative or court
      proceeding, suit, dispute or other claim regarding Taxes.

     

    “Tax
      Return” means any return, declaration, report, claim for refund or
      information return or statement relating to Taxes, including any schedule or
      attachment thereto, and including any amendment thereof.

     

    “Taxing
      Authority” means any governmental authority (domestic or foreign)
      responsible for the imposition of any Tax.

     

    
      
        
        

      

      
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     “Transportation
      Code” means 49 U.S.C. subtitle VII, as amended, and any successor
      statute thereto and the Federal Aviation Regulations issued or promulgated
      pursuant thereto.

     

    Section
      1.02  .  Other
      Definitional and Interpretative Provisions.  Unless specified
      otherwise, in this Agreement the obligations of any party consisting of more
      than one Person are joint and several.  The words “hereof”, “herein”
and “hereunder” and words of like import used in this Agreement shall refer to
      this Agreement as a whole and not to any particular provision of this
      Agreement.  The captions herein are included for convenience of
      reference only and shall be ignored in the construction or interpretation
      hereof.  References to Articles, Sections, Exhibits and Schedules are
      to Articles, Sections, Exhibits and Schedules of this Agreement unless otherwise
      specified.  All Exhibits and Schedules annexed hereto or referred to
      herein are hereby incorporated in and made a part of this Agreement as if set
      forth in full herein.  Any capitalized terms used in any Exhibit or
      Schedule but not otherwise defined therein shall have the meaning as defined
      in
      this Agreement.  Any singular term in this Agreement shall be deemed
      to include the plural, and any plural term the singular.  Whenever the
      words “include,” “includes” or “including” are used in this Agreement, they
      shall be deemed to be followed by the words “without limitation,” whether or not
      they are in fact followed by those words or words of like
      import.  “Writing,” “written” and comparable terms refer to printing,
      typing and other means of reproducing words (including electronic media) in
      a
      visible form.  References to any Person include the successors and
      permitted assigns of that Person.  References from or through any date
      mean, unless otherwise specified, from and including or through and including,
      respectively.

     

    ARTICLE
      2  

    Purchase
      and Sale

     

    Section
      2.01  .  Purchase
      and Sale.  (a) Upon the terms and subject to the
      conditions of this Agreement, Seller agrees to sell to Buyer and Buyer agrees
      to
      purchase from Seller, 39% of the total equity shares of the
      Company.  The purchase price (the “Purchase Price”)
      is $100,000 (one hundred thousand dollars), consisting of $100,000 in the common
      stock of the Purchaser (200,000 shares at a price of $0.50 per share) and a
      credit facility up to $100,000 (one hundred thousand dollars)

     

    Section
      2.02  .  Closing.  Upon
      mutual execution of this document via electronic counterparts with executed
      follow the parties agree as follows

     

    (a)  Buyer
      shall deliver  to Seller 200,000 shares of the Buyers common stock or
      a corresponding amount equal to $100,000 (one hundred thousand dollars)
      calculated on the closing price of the first days trading of the Buyers common
      stock on the OTCBB Market.

     

    
      
        
        

      

      
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    (b)     Buyer
      further agrees to satisfy the conditions and items  outlined in the
      addendum letter dated August 3rd 2007 attached
      hereto as exhibit 1 and incorporated herein by reference.

     

    (c)  Seller
      shall deliver to the mutually agreed upon escrow agent the certificates of
      the
      the Shares of seller endorsed in blank, with any required transfer stamps
      affixed thereto.  Said shares shall be held in escrow attached hereto
      as exhibit 2 until such time as purchase price has been paid and all conditions
      of section 2.01 of this agreement, and exhibit 1 attached hereto have been
      satisfied.  At such time Sellers shares shall be released from escrow
      and delivered to Buyer forthwith.

     

    ARTICLE
      3  

    Representations
      and Warranties of the Sellers

     

    Seller
      makes the following representations and warranties to Buyer with respect to
      the
      Company as of the date hereof (except to the extent expressly relating to a
      specific date, in which event such representation or warranty shall be made
      as
      of such date), which shall be unaffected by any investigation heretofore or
      hereafter made by or on behalf of Buyer:

     

    Section
      3.01  .  Corporate
      Existence and Power.  The Company is a corporation duly
      incorporated, validly existing and in good standing under the laws of its
      jurisdiction of incorporation and has all corporate powers required to carry
      on
      its business as now conducted.  

     

    Section
      3.02  .  Corporate
      Authorization and Binding Effect.  The execution, delivery and
      performance by Seller of this Agreement, and the consummation by each of the
      Sellers and the Company of the transactions contemplated hereby and thereby
      have
      been duly authorized by all necessary corporate and shareholder action by each
      of the Sellers and the Company.  Seller and the Company has full power
      and authority to execute and deliver this Agreement and to perform its
      obligations hereunder.  This Agreement and each Related Agreement to
      which it is a party has been duly executed and delivered by Seller and the
      Company and, assuming due and valid authorization, execution and delivery
      thereof by Buyer, this Agreement is a valid and binding obligation of Seller
      and
      the Company party thereto, enforceable in accordance with its terms and
      conditions.

     

    Section
      3.03  .  Governmental
      Authorization.  The execution, delivery and performance by the
      Seller of this Agreement and the consummation by the Seller of the transactions
      contemplated hereby require no action by or in respect of, or filing with,
      any
      Governmental Authority.

     

    
      
        
        

      

      
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    Section
      3.04  .  Noncontravention.  The
      execution, delivery and performance by the Seller of this Agreement and the
      consummation by Seller and the Company of the transactions contemplated hereby
      and thereby do not and will not (i) contravene or conflict with the certificates
      or articles of incorporation or bylaws of the Seller or the Company; (ii)
      contravene or conflict with or constitute a violation of any provision of any
      Law binding upon or applicable to the Seller or the Company or any of their
      respective properties or assets; (iii) result in a violation or a breach of,
      or
      constitute a default or require any consent under or give rise to a right of
      termination, cancellation or acceleration of any right or obligation of the
      Company or to a loss of any benefit to which the Company is entitled under
      any
      provision of any note, bond, mortgage, indenture, lease, agreement, contract,
      obligation or other instrument to which the Company is bound, or any license,
      franchise, permit or other similar authorization held by the Company; or (iv)
      result in the creation or imposition of any Lien on any asset of the Company,
      except for any Permitted Liens.

     

    Section
      3.05  .  Capitalization.  The
      authorized capital stock of the Company consists of  500 (five
      hundred) shares of Common Stock.  There are outstanding 500 (five
      hundred) shares of Common Stock.  All outstanding shares of capital
      stock of the Company are duly authorized, validly issued, fully paid,
      nonassessable and free from preemptive rights.  Except as set forth in
      this Section
      3.05, there are no outstanding (i) shares of capital stock or other
      voting securities of or other ownership interests in the Company; (ii))
      securities of the Company convertible into or exchangeable for shares of capital
      stock or voting securities of or other ownership interests in the Company;
      or
      (iii) options or other rights to acquire from the Company, or any obligation
      of
      the Company to issue, transfer or sell, any capital stock or voting securities
      of or other ownership interests in the Company or securities convertible into
      or
      exchangeable for capital stock or voting securities of or other ownership
      interests in the Company (the items in clauses (i), (ii) and (iii) being
      referred to collectively as the “Company
      Securities”).  There are no outstanding obligations of the
      Company to repurchase, redeem or otherwise acquire any Company
      Securities.  The Company does not have any Subsidiaries.

     

    Section
      3.06  .  Ownership
      of Shares.  Seller is the record and beneficial owner of the
      Shares, free and clear of any Lien, and will transfer and deliver to Buyer
      at
      the Closing valid title to the Shares, free and clear of any
      Lien.  

     

    Section
      3.07  .  Permits;
      Compliance.  (a) The Company is in possession of
      all franchises, grants, authorizations, licenses, permits, easements, variances,
      exceptions, consents, certificates, approvals, clearances and orders of any
      Governmental Authority necessary for the Company to operate its repair and
      manufacturing business as currently conducted, to own, lease and operate its
      properties and to carry on the Business (the “Company Permits”)
      and the use and operation by the Company of its properties and the conduct
      of
      the Business comply with the requirements and conditions of all Company
      Permits.

     

    
      
        
        

      

      
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    (b)  All
      of
      the Company Permits are valid and in full force and effect. To the Knowledge
      of
      Seller, no suspension, cancellation or limitation of any of the Company Permits
      is threatened.

     

    (c)  A
      certificate of calibration or compliance for each tooling of the Company has
      been duly issued pursuant to relevant federal aviation laws and is in full
      force
      and effect.  Each tool owned by the Company is duly registered in the
      name of the Company in accordance with federal aviation laws.  Each
      tool or machinery used by the Company but owned by a third party is duly
      registered in the name of such third party in accordance with all applicable
      federal aviation laws and the Company is authorized to use such tool under
      all
      applicable federal aviation laws.

     

    Section
      3.08  .  Financial
      Statements.  (a) The unaudited consolidated balance
      sheets of the Company as of December 31, 2006, and the related unaudited
      consolidated statements of income, cash flows and stockholders equity for the
      year ending December 31, 2005  (collectively, the “Financial
      Statements”), the financial position of the Company as of the dates
      thereof and their consolidated results of operations, cash flows and
      stockholders equity for the periods then ended.

     

    Section
      3.09  .  Books
      and Records.  The books of account, minute books and stock record
      books of the Company are complete and correct in all material respects and
      have
      been maintained in accordance with reasonable and customary business
      practices.  The minute books of the Company contain records that are
      complete and correct in all material respects of all meetings of, and corporate
      action taken by (including all actions by unanimous written consent), the
      shareholders and directors of the Company since August 13, 2002,  True
      and complete copies of all minute books and all stock record books of the
      Company have heretofore been made available to Buyer.

     

    Section
      3.10  .  Absence
      of Certain Changes.  The Company has conducted its business in
      the ordinary course consistent with past practices and there has not
      been:

     

    (a)  any
      event, occurrence or development which has had a Company Material Adverse
      Effect;

     

    (b)  any
      declaration, setting aside or payment of any dividend or other distribution
      with
      respect to any shares of capital stock of the Company, or any repurchase,
      redemption or other acquisition by the Company of any outstanding shares of
      capital stock or other securities of, or other ownership interests in, the
      Company;

     

    
      
        
        

      

      
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    (c)  any
      amendment of any material term of any outstanding security of the
      Company;

     

    (d)  any
      incurrence, assumption, amendment or guarantee by the Company of any
      indebtedness for borrowed money, or any foreign currency, hedging, financial
      derivatives or similar transactions, other than in the ordinary course of
      business and consistent with past practices;

     

    (e)  any
      creation or assumption by the Company of any Lien, other than Permitted Liens,
      on any asset of the Company;

     

    (f)  (i)
      any
      making of any loan, advance or capital contribution to or investment in any
      Person by the Company other than loans, advances, capital contributions or
      investments made in the ordinary course of business consistent with past
      practices or (ii) any amendment of the terms of any loan to executive officers
      or directors;

     

    (g)  any
      transaction or commitment made, or any contract or agreement entered into,
      by
      the Company relating to its assets or the Business (including the acquisition
      or
      disposition of any assets), in either case, material to the Company, other
      than
      transactions and commitments in the ordinary course of business consistent
      with
      past practices and those contemplated by this Agreement;

     

    (h)  any
      material change in any method of accounting or accounting practice by the
      Company.

     

    (i)  any
      payment, discharge or satisfaction of any material claim, liability or
      obligation, except in the ordinary course of business or pursuant to the terms
      of any Material Contract;

     

    (j)  any
      material modification to a Material Contract;

     

    (k)  except
      as
      required under applicable law or pursuant to existing agreements, any (i) grant
      of any severance or termination pay to any director, officer or employee of
      the
      Company, (ii) increase in compensation, bonus or other benefits payable under
      any severance or retirement or termination pay policies of the Company, (iii)
      entering into of any employment, deferred compensation or other similar
      agreement (or any amendment to any such existing agreement) with any director,
      officer or employee of the Company or (iv) adoption of any new Employee Plan
      or
      modification of any Employee Plan, in the case of each of clauses (i) through
      (iv), other than in the ordinary course of business consistent with past
      practices; or

     

    
      
        
        

      

      
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    (l)  any
      disposal or lapse of any rights to the use of any Intellectual Property Right,
      which would have a Company Material Adverse Effect.

     

    Section
      3.11  .  No
      Undisclosed Material Liabilities.  There are no liabilities or
      obligations of the Company of any kind, other than:

     

    (a)  liabilities
      or obligations disclosed or provided for in the Balance Sheet or the notes
      thereto;

     

    (b)  liabilities
      or obligations incurred in the ordinary course of business since the Balance
      Sheet Date;

     

    (c)  liabilities
      or obligations under this Agreement; and

     

    (d)  other
      liabilities or obligations which in the aggregate would not have a Company
      Material Adverse Effect.

     

    Section
      3.12  .  
      Litigation.  As of the date of this Agreement, the Seller has
      disclosed all pending and current litigation, legal action, or arbitration,
      attached hereto as exhibit 2.

     

    Section
      3.13  .  Taxes.  (a) The
      Company will also separately file all material Tax Returns that it is required
      to file for each taxable period.  All such Tax Returns will be filed,
      correct and complete in all material respects and will be prepared in
      substantial compliance with all applicable laws and regulations.  The
      Company will pay all material Taxes shown or required to be shown on such
      separate Tax Returns.

     

    (b)  There
      are
      no Liens for Taxes (other than Taxes not yet due and payable) upon any of the
      assets of the Company.

     

    (c)  The
      Company has withheld and paid all employment, sales, use and other Taxes
      required to have been withheld and paid in connection with any amounts paid
      or
      owing to any employee, independent contractor, creditor or other third
      party.

     

    (d)  There
      is
      no pending or any threatened dispute or claim concerning any material Tax
      liability of the Company for any taxable period during which the Company was
      a
      member of the Seller’s Affiliated Group.

     

    Section
      3.14  .  Employee
      Plans.  The company has provided the Buyer with all information
      regarding employee compensation plans.

     

    (a)  The
      Company does not presently sponsor, maintain or contribute to, and has not
      in
      the past sponsored, maintained or contributed to, or agreed to sponsor, maintain
      or contribute to, any Pension Plan.

     

    (b)   Labor
      Matters.   at the date of this Agreement:

     

    
      
        
        

      

      
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    (i)  there
      are
      no controversies pending or threatened between the Company and any of its
      employees;

     

    (ii)  the
      Company has not breached in any material respect or otherwise failed to comply
      in any material respect with any provision of any Collective Bargaining
      Agreement applicable to persons employed by the Company, nor has any such breach
      or failure been alleged, and there are no material grievances outstanding
      against the Company thereunder;

     

    (iii)  there
      is
      no petition pending before the National Mediation Board seeking certification
      or
      any change in certification of a labor representative with respect to any craft
      or class of employees of the Company;

     

    (iv)  there
      is
      no strike, slowdown, work stoppage, labor action or lockout or threat thereof,
      by or with respect to any employees of the Company; and

     

    (v)  there
      is
      no complaint for violation of the Railway Labor Act, 45 U.S.C. § 8, as amended,
      against the Company pending before any Governmental Authority.

     

    Section
      3.15  .  Certain
      Business Practices.  Neither the Company nor any of its
      directors, officers employees or any other person authorized to act on behalf
      of
      the Company has used any corporate funds for unlawful contributions, gifts,
      entertainment or other unlawful expenses relating to political activity, made
      any unlawful payment to foreign or domestic government officials or employees
      or
      to foreign or domestic political parties or campaigns from corporate funds,
      violated any provision of the Foreign Corrupt Practices Act of 1977, as amended,
      or made any bribe, rebate, payoff, influence payment, kickback or other similar
      unlawful payment to any foreign or domestic government official or employee
      from
      corporate funds.

     

    Section
      3.16  .  Environmental
      Matters.  (a) Except as to matters that would not
      have a Company Material Adverse Effect:

     

    (i)  no
      complaint has been filed, no penalty has been assessed, and no third-party
      investigation, claim, suit, proceeding or review is pending or is threatened
      by
      any Governmental Authority or other Person against the Company and, in each
      case, alleging or relating to any violation by the Company of any Environmental
      Law;

     

    (ii)  the
      Company is in compliance with all Environmental Laws and has obtained and is
      in
      compliance with all permits, licenses, franchises, certificates, approvals
      and
      other similar authorizations of any Governmental Authority (collectively,
“Environmental Permits”) required by Environmental Laws to
      conduct the Business;

     

    
      
        
        

      

      
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     .  Compliance
      With Laws and Court Orders. The Company is in compliance with all, and is
      not under investigation with respect to applicable Laws.

     

    Section
      3.17  .  Employee
      Matters.  The Company is in compliance in all material respects
      with all applicable Laws respecting employment and employment practices, terms,
      and conditions of employment, and wages and hours and is not engaged in any
      unfair labor practice.

     

    Section
      3.18  .  Title
      to Assets; Liens.  The Company has good title to all the
      properties and assets reflected in the Balance Sheet and all assets purchased
      by
      the Company since the Balance Sheet Date free and clear of all Liens (other
      than
      Permitted Liens).  At the time of the Closing, the assets of the
      Company, taken together with the rights and benefits to Buyer arising under
      the
      Related Agreements, shall be adequate in all material respects to allow Buyer
      at
      such time to conduct the Business substantially as it is currently being
      conducted.

     

    Section
      3.19  .  Real
      Property.  (a) True and correct copies of all leases affecting
      the Real Property have been made available to Buyer.  There are no
      proceedings, claims, disputes, or conditions affecting any Real Property that
      would reasonably be expected to materially interfere with the Company’s use of
      such property, whether before or after the Closing Date, for the conduct of
      the
      Business as currently being conducted.  Neither the whole nor any
      portion of the Real Property is subject to any governmental decree or order
      to
      be sold or is being condemned, expropriated, or otherwise taken by any public
      authority, nor to the Knowledge of Seller has any such condemnation,
      expropriation, or taking been proposed.  All Real Property is leased
      free and clear of all Liens on such leasehold interests other than Permitted
      Liens.

     

    (b)  To
      Seller’s Knowledge, there is no structural defect in any of the Real Property or
      the improvements thereon.

     

    Section
      3.20  .  Material
      Contracts.  (a)  The Company is not a party to
      or bound by:

     

    (i)  any
      airport lease or lease of real property providing for annual rentals of $30,000
      or more;

     

    (ii)  any
      agreement for the purchase of materials, supplies, goods, services, equipment
      or
      other assets (other than pursuant to purchase orders made in the ordinary course
      of business consistent with past practice) providing for annual payments by
      the
      Company of $50,000 or more;

     

    (iii)  any
      capacity purchase, alliance or similar agreement with another airline or
      repair/manufacturing facility relating to the operation of the Company’s tooling
      for the benefit of such other airline or repair facility that will not be
      terminated on or prior to Closing;

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    (iv)  any
      material partnership, joint venture or other similar agreement or
      arrangement;

     

    (v)  any
      agreement relating to indebtedness for borrowed money or the deferred purchase
      price of property (in either case, whether incurred, assumed, guaranteed or
      secured by any asset), except any such agreement with an aggregate outstanding
      principal amount not exceeding $100,000;

     

    (vi)  any
      agreement that limits in any material respect the freedom of the Company to
      compete in any line of business, with any Person or in any area for any length
      of time;

     

    (vii)  any
      contract or commitment requiring, after the date hereof, the mortgage, pledge,
      sale, or disposal of assets with a value in excess of $100,000 or release,
      grant, or transfer of Company rights with a value in excess of $100,000;
      or

     

    (b)  Each
      agreement, contract, plan, lease, arrangement or commitment required to be
      disclosed pursuant to this Section (collectively, “Material
      Contracts”) is a valid and binding agreement of the Company and is in
      full force and effect, and none of the Company or, to the Knowledge of Seller,
      any other party thereto is in default or breach in any respect under the terms
      of any such agreement, contract, plan, lease, arrangement or
      commitment.

     

    Section
      3.21  .  Insurance.  Seller
      has disclosed to Buyer all insurance policies providing coverage in favor of
      the
      Company or any of its properties, including “all risk” insurance policies
      (collectively, the “Insurance Policies”).  There are
      no material claims by the Company pending under any of the Insurance Policies
      as
      to which coverage has been questioned, denied or disputed by the underwriters
      of
      such policies or in respect of which such underwriters have reserved their
      rights.  As of the date hereof, all Insurance Policies are in full
      force and effect, all premiums due thereon have been paid and the Company is
      in
      compliance in all material respects with the terms and provisions of the
      Insurance Policies.

     

    Section
      3.22  .  Intellectual
      Property.  (a) No Company Intellectual Property
      Right is subject to any outstanding judgment, injunction, order, decree or
      agreement restricting the use thereof by the Company or restricting the
      licensing thereof by the Company to any Person.

     

    (b)  Except
      as
      expressly disclosed to Buyer, the Company has the sole and exclusive right
      to
      use the Company Intellectual Property Rights, and no consent of any third party
      is required for the use thereof by the Company following Closing.  To
      the Knowledge of Seller, no claims have been asserted by any person challenging
      the use of any Company Intellectual Property Rights, or challenging or
      questioning the validity or effectiveness of any such license or agreement.
      No
      additional Intellectual Property Rights other than the Company Intellectual
      Property Rights are necessary or material to the conduct of the
      Business.

     

    
      
        
        

      

      
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    ARTICLE
      4

    Representations
      and Warranties of Buyer

     

    Buyer
      hereby makes the following representations and warranties to the Sellers as
      of
      the date hereof (except to the extent expressly relating to a specific date,
      in
      which event such representation or warranty shall be made as of such date),
      which shall be unaffected by any investigation heretofore or hereafter
      made.

     

    Section
      4.01  .  Corporate
      Existence and Power.  Buyer is a corporation duly incorporated,
      validly existing and in good standing under the laws of its jurisdiction of
      incorporation and has all corporate powers required to carry on its business
      as
      now conducted.  

     

    Section
      4.02  .  Corporate
      Authorization.  The execution, delivery and performance by Buyer
      of this Agreement and each Related Agreement to which it is a party and the
      consummation by Buyer of the transactions contemplated hereby and thereby have
      been duly authorized by all necessary corporate and shareholder action by
      Buyer.  Buyer has full power and authority to execute and deliver this
      Agreement and to perform its obligations hereunder. This Agreement has been
      duly
      executed and delivered by Buyer and, assuming due and valid authorization,
      execution and delivery thereof by each Seller party thereto, this Agreement
      is a
      valid and binding obligation of Buyer, enforceable in accordance with its terms
      and conditions.

     

    Section
      4.03  .  Governmental
      Authorization.  The execution, delivery and performance by Buyer
      of this Agreement and each Related Agreement and the consummation by Buyer
      of
      the transactions contemplated hereby and thereby require no action by or in
      respect of, or filing with, any Governmental Authority

     

    Section
      4.04  .   Noncontravention.  The
      execution, delivery and performance by Buyer of this Agreement and the
      consummation by Buyer of the transactions contemplated hereby do not and will
      not (i) contravene or conflict with the articles of incorporation or bylaws
      of
      Buyer, (ii) assuming compliance with the matters referred to in Section 4.03,
      contravene or conflict with or constitute a violation of any provision of any
      Law binding upon or applicable to Buyer, (iii) result in a violation or a breach
      of, or constitute a default or require any consent under or give rise to a
      right
      of termination, cancellation or acceleration of any right or obligation of
      Buyer
      or to a loss of any benefit to which Buyer is entitled under any provision
      of
      any note, bond, mortgage, indenture, lease, agreement, contract, obligation
      or
      other instrument to which Buyer is bound, or any license, permit or other
      similar authorization held by Buyerj.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    Section
      4.05  .  Litigation.  As
      of the date of this Agreement, there is no judicial or administrative action,
      suit or proceeding pending, or to the knowledge of Buyer, threatened against
      Buyer before any Governmental Authority which in any manner challenges or seeks
      to prevent, enjoin, alter or materially delay the transactions contemplated
      by
      this Agreement.

     

    ARTICLE
      5

    Covenants
      of the Sellers

     

    Each
      of
      the Sellers agrees that:

     

    Section
      5.01  .  Conduct
      of the Company.  Except as expressly contemplated by this
      Agreement or as otherwise consented to by Buyer in writing, during the period
      from the date hereof and continuing, each of the Sellers shall cause the Company
      to:

     

    (a)  conduct
      its business in the usual, regular and ordinary course consistent with past
      practices;

     

    (b)  not
      mortgage, pledge, sell or dispose of any assets with a value of $3,000 or more
      in the aggregate, and not waive, release, grant, transfer or permit to lapse
      any
      Company rights of value in excess of $5,000 in the aggregate;

     

    (c)  comply
      in
      all material respects with all provisions of any Material Contracts to which
      the
      Company is a party;

     

    (d)  not
      take
      any action that would result in the representation set forth in Section 3.10(k)
      being untrue;

     

    (e)  not
      enter
      into any new or amended contract, agreement, side letter or memorandum of
      understanding with any unions representing employees of the
      Company;

     

    (f)  not
      enter
      into any agreement or understanding with any other Person outside of the
      ordinary course of business consistent with past practices involving
      expenditures in excess of $3,000 in the aggregate or involving terms of duration
      or commitments in excess of 3 months;

     

    (g)  not
      enter
      into any agreement or understanding with any other Person containing any
      exclusivity, non-competition or similar provisions that would materially
      restrict the ability of the Company to compete;

     

    (h)  not
      adopt
      or propose any change in its organizational documents (including bylaws);
      and

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    (i)  not
      merge
      or consolidate with any other Person.

     

    Section
      5.02  .  Access
      to Information; Confidentiality.  

     

    (a)  After
      the
      Closing, Seller will hold, and will use their best efforts to cause their
      respective officers, directors, employees, accountants, counsel, consultants,
      advisors and agents to hold, in confidence, unless compelled to disclose by
      judicial or administrative process or by other requirements of law, all
      confidential documents and information concerning the Company, except to the
      extent that such information can be shown to have been (i) previously known
      on a
      nonconfidential basis by either Seller, (ii) in the public domain through no
      fault of Sellers or their Affiliates or (iii) later lawfully acquired by any
      Seller from sources other than those related to its prior ownership of the
      Company.  The obligation of Sellers and their Affiliates to hold any
      such information in confidence shall be satisfied if they exercise the same
      care
      with respect to such information as they would take to preserve the
      confidentiality of their own similar information.

     

    (b)  On
      and
      after the Closing Date, Seller will afford, promptly to Buyer and its agents
      reasonable access to its books of account, financial and other records
      (including accountant’s work papers), information, employees and auditors to the
      extent reasonably necessary for Buyer in connection with any audit,
      investigation, dispute or litigation (other than any dispute or litigation
      involving either of the Sellers) relating to the Business; provided
      that any such access by Buyer shall be conducted during normal business hours
      and shall not unreasonably interfere with the conduct of the business of the
      Sellers, Buyer shall bear all of the out-of-pocket costs and expenses (including
      reasonable attorneys’ fees, but excluding reimbursement of Seller for general
      overhead, salaries and employee benefits) reasonably incurred in connection
      with
      the foregoing.

     

    Section
      5.03  .  Notices
      of Certain Events.  From the date hereof, Seller shall promptly
      notify Buyer of:

     

    (a)  any
      actions, suits, claims, investigations or proceedings (i) commenced against
      the
      Company or (ii) in respect of which the Company has an indemnification
      obligation and as to which Seller has Knowledge that, if pending on the date
      of
      this Agreement, would have been required to have been disclosed pursuant to
      Section 3.12;

     

    (b)  any
      material agreement or litigation, or consent or order of the FAA or DOT, related
      to the Company (other than those that apply generally to air carriers or
      companies in the airline industry); and

     

    (c)  any
      incidents or accidents occurring on or after the date hereof involving any
      property owned or operated by the Company that has resulted or would reasonably
      be expected to result in casualty damages or losses in excess of
      $20,000.

     

    
      
        
        

      

      
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    ARTICLE
      6

    Covenants
      of Buyer

     

    Buyer
      agrees that:

     

    Section
      6.01  .  Confidentiality.  Prior
      to the Closing Date and after any termination of this Agreement, Buyer and
      its
      Affiliates will hold, and will use their best efforts to cause their respective
      officers, directors, employees, accountants, counsel, consultants, advisors
      and
      agents to hold, in confidence all confidential documents and information
      concerning the Company furnished to Buyer or its Affiliates in connection with
      the transaction contemplated by this Agreement.

     

    Section
      6.02  .  
      Trademarks; Tradenames.  Buyer shall not permit the Company to
      use any of the marks or names of Seller that the parties agree shall belong
      to
      Seller after closing. 

     

    ARTICLE
      7

    Covenants
      of Buyer and the Sellers

     

    Buyer
      and
      the Sellers agree that:

     

    Section
      7.01  .  Best
      Efforts; Further Assurances.  (a) Subject to the
      terms and conditions of this Agreement, Buyer and the Sellers will use their
      best efforts to take, or cause to be taken, all actions and to do, or cause
      to
      be done, all things necessary or desirable under applicable laws and regulations
      to consummate the transactions contemplated by this Agreement.  Seller
      and Buyer shall, and the Sellers shall cause the Company prior to the Closing,
      and Buyer shall cause the Company after the Closing, to execute and deliver
      such
      other documents, certificates, agreements and other writings and to take such
      other actions as may be necessary or desirable in order to consummate or
      implement expeditiously the transactions contemplated by this
      Agreement.

     

    Section
      7.02  .  Public
      Announcements.  The parties agree to consult with each other
      before issuing any press release or making any public statement with respect
      to
      this Agreement or the transactions contemplated hereby and, except for any
      press
      releases and public announcements the making of which may be required by
      applicable law or any listing agreement with any national securities exchange,
      will not issue any such press release or make any such public statement prior
      to
      such consultation..

     

    Section
      7.03    Operational
      Agreement.  Both parties agree that within 120 days of closing an
      operational partnership agreement shall be in place, inclusive of employment
      agreements for principal officers of the Seller.  Buyer and Seller
      have to date negotiated most of the terms of the agreement and will use their
      best faith efforts to complete and ratify said agreement.  In the
      event of a failure to complete an agreement both buyer and seller will enter
      into binding arbitration through a neutral third party until such time as an
      agreement has been made.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      8

    Employee
      Benefits

     

    Section
      8.01  .  Employee
      Benefits.  (a)  Nothing herein shall be construed to
      require the Company or Buyer to continue after Closing the employment of any
      Company employee or to otherwise interfere with the Company’s right to terminate
      any such employees at any time after Closing.

     

    (b)  Following
      the Closing Date, except to the extent otherwise prohibited by applicable law,
      each employee of the Company shall receive service credit for purposes of
      eligibility to participate and vesting (but not for benefit accrual purposes)
      for all periods of employment with the Company and its Affiliates and
      predecessors thereto prior to the Closing Date under any employee benefit plan
      of Buyer or its Affiliates in which such employee is eligible to participate
      after the Closing Date, to the extent such credit existed immediately prior
      to
      the Closing Date under the corresponding Employee Plan maintained by the
      Company.

     

    ARTICLE
      9

    Conditions
      to Closing

     

    Section
      9.01  .  Conditions
      to Obligations of Buyer and the Sellers.  The obligations of
      Buyer and the Sellers to consummate the Closing are subject to the satisfaction
      of the following conditions:

     

    (a)  no
      provision of any Law shall prohibit the consummation of the
      Closing;

     

    (b)  there
      shall not be in effect any Law enacted, enforced, promulgated, issued or deemed
      applicable to the transactions contemplated hereby of any Governmental Authority
      that makes illegal or otherwise materially restrains or prohibits the
      consummation of the transactions contemplated hereby.

     

    Section
      9.02  .  Conditions
      to Obligation of Buyer.  The obligation of Buyer to consummate
      the Closing is subject to the satisfaction of the following further
      conditions:

     

    (a)  the
      Seller shall have performed or complied with in all material respects all of
      the
      covenants and agreements required to be performed by it on or prior to the
      Closing Date under this Agreement, and the representations and warranties of
      the
      Seller set forth in this Agreement shall be true at and as of the Closing Date
      as if made at and as of such time (except as to any representation or warranty
      which speaks as of a specific date, which must be true as of such
      date;

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    (b)  there
      shall not have occurred any Company Material Adverse Effect after the date
      hereof which is continuing on the Closing Date;

     

    (c)  Buyer
      shall have received all documents it may reasonably request relating to the
      existence of the Seller and the authority of the Seller for this Agreement,
      all
      in form and substance reasonably satisfactory to Buyer; and

     

    Section
      9.03  .  Conditions
      to Obligation of the Sellers.  The obligation of the Sellers to
      consummate the Closing is subject to satisfaction of the following further
      conditions:

     

    (a)  Buyer
      shall have performed or complied with in all material respects all of the
      covenants and agreements required to be performed by it on or prior to the
      Closing Date under this Agreement, and the representations and warranties of
      Buyer set forth in this Agreement shall be true at and as of the Closing Date
      as
      if made at and as of such time (except as to any representation or warranty
      which speaks as of a specific date, which must be true as of such date);
      and

     

    (b)  the
      Seller shall have received all documents it may reasonably request relating
      to
      the existence of Buyer and the authority of Buyer for this Agreement, all in
      form and substance reasonably satisfactory to the Sellers.

     

    ARTICLE
      10

    Survival;
      Indemnification

     

    Section
      10.01  .  Survival.  Except
      as specifically set forth below, the representations and warranties of the
      parties hereto contained in this Agreement or in any certificate or other
      writing delivered pursuant hereto or in connection herewith shall survive the
      Closing until the first anniversary of the Closing Date.  The
      covenants and agreements of the parties hereto contained in this Agreement
      or in
      any certificate or other writing delivered pursuant hereto or in connection
      herewith shall survive the Closing indefinitely or for the shorter period
      explicitly specified therein, except that for such covenants and agreements
      that
      survive for such shorter period, breaches thereof shall survive indefinitely
      or
      until the latest date permitted by law.  Notwithstanding the preceding
      sentences, any breach of representation, warranty, covenant or agreement in
      respect of which indemnity may be sought under this Agreement shall survive
      the
      time at which it would otherwise terminate pursuant to the preceding sentences,
      if notice of the inaccuracy or breach thereof giving rise to such right of
      indemnity shall have been given to the party against whom such indemnity may
      be
      sought prior to such time.

     

    Section
      10.02  .  Indemnification.  (a)Effective
      at and after the Closing, Seller hereby indemnifies Buyer and its Affiliates
      against and agrees to hold each of them harmless from any and all damage, loss
      and expense (including reasonable expenses of investigation and reasonable
      attorneys’ fees and expenses and any fines or penalties imposed) actually
      suffered by Buyer or any of its Affiliates arising out of any misrepresentation
      or breach of representation or warranty (each such misrepresentation and breach,
      a “Warranty Breach”) or breach of covenant or agreement made or
      to be performed by the Sellers pursuant to this Agreement. 

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    (b)  Effective
      at and after the Closing, Buyer hereby indemnifies Seller and its Affiliates
      against and agrees to hold each of them harmless from any and all Damages
      actually suffered by Seller or any of its Affiliates arising out of any Warranty
      Breach or breach of covenant or agreement made or to be performed by Buyer
      pursuant to this Agreement.

     

    Section
      10.03  .  Procedures.  (a) The
      party seeking indemnification under Section 10.02 (the “Indemnified
      Party”) agrees to give prompt notice to the party against whom
      indemnity is sought (the “Indemnifying Party”) of the assertion
      of any claim, or the commencement of any suit, action or proceeding
      (“Claim”) in respect of which indemnity may be sought under
      such Section and will provide the Indemnifying Party such information with
      respect thereto that the Indemnifying Party may reasonably request. The failure
      to so notify the Indemnifying Party shall not relieve the Indemnifying Party
      of
      its obligations hereunder, except to the extent such failure shall have
      adversely affected the Indemnifying Party.

     

    (b)  The
      Indemnifying Party shall be entitled to participate in the defense of any Claim
      asserted by any third party (“Third Party Claim”) and, subject
      to the limitations set forth in this Section, shall be entitled to assume the
      control of and appoint lead counsel for such defense, in each case at its
      expense.j

     

    (c)  If
      the
      Indemnifying Party shall assume the control of the defense of any Third Party
      Claim in accordance with the provisions of this Section 10.03, (i) the
      Indemnifying Party shall obtain the prior written consent of the Indemnified
      Party (which shall not be unreasonably withheld, delayed or conditioned) before
      entering into any settlement of such Third Party Claim, but only if the
      settlement does not release the Indemnified Party from all liabilities and
      obligations with respect to such Third Party Claim or if the settlement imposes
      injunctive or other equitable relief against the Indemnified Party, and (ii)
      the
      Indemnified Party shall be entitled to participate in the defense of such Third
      Party Claim and to employ separate counsel of its choice for such
      purpose.  The fees and expenses of such separate counsel shall be paid
      by the Indemnified Party.  The Indemnifying Party shall have no
      indemnification obligations with respect to any Third Party Claim that shall
      be
      settled by the Indemnified Party without the prior written consent of the
      Indemnifying Party, which consent shall not be unreasonably withheld, delayed
      or
      conditioned.

     

    (d)  Each
      party shall cooperate, and cause their respective Affiliates to cooperate,
      in
      the defense or prosecution of any Third Party Claim and shall furnish or cause
      to be furnished such records, information and testimony, and attend such
      conferences, discovery proceedings, hearings, trials or appeals, as may be
      reasonably requested in connection therewith.  The Indemnified Party
      shall keep the Indemnifying Party fully informed of the defense of any Third
      Party Claim conducted by such Indemnified Party.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    (e)  Each
      Indemnified Party shall use reasonable efforts to collect any amounts available
      under insurance coverage, or from any other Person alleged to be responsible,
      for any Damages payable under Section 10.02.

     

    Section
      10.04  .  Knowledge.  Notwithstanding
      anything in this Agreement to the contrary, the rights of the parties to
      indemnification based on the representations and warranties set forth in this
      Agreement shall not be affected by any investigation conducted with respect
      to,
      or any knowledge acquired (or capable of being acquired) about the accuracy
      or
      inaccuracy of or compliance with, any such representation or
      warranty.

     

    ARTICLE
      11

    Termination

     

    Section
      11.01  .  Grounds
      for Termination.  This Agreement may be terminated at any time
      prior to the Closing:

     

    (a)  by
      mutual
      written agreement of Seller and Buyer;

     

    (b)  by
      either
      Seller or Buyer if consummation of the transactions contemplated hereby would
      violate any nonappealable final order, decree or judgment of any Governmental
      Authority having competent jurisdiction; or

     

    (c)  by
      Buyer
      if (i) Seller shall have filed a petition for relief under the Bankruptcy Code
      prior to the Closing or (ii) an involuntary petition for relief under the
      Bankruptcy Code is filed against Seller prior to the Closing by any party other
      than (x) Buyer or its Affiliates or (y) any Person acting at the direction
      of or
      in concert with Buyer or its Affiliates and such petition is not dismissed
      prior
      to the Closing;

     

    The
      party
      desiring to terminate this Agreement pursuant to clauses of this Section 11.01
      shall give notice of such termination to the other party.

     

    Section
      11.02  .  Effect
      of Termination.  If this Agreement is terminated as permitted by
      Section 11.01, such termination shall be without liability of any party (or
      any
      stockholder, director, officer, employee, agent, consultant or representative
      of
      such party) to any other party to this Agreement; provided that if such
      termination shall result from either party’s willful (i) failure to fulfill a
      condition to the performance of the obligations of the other party, (ii) failure
      to perform a covenant set forth in this Agreement or (iii) breach of any
      representation or warranty or agreement contained herein, such failing or
      breaching party shall be fully liable for any and all Damages incurred or
      suffered by the other party as a result of such failure or
      breach.  The provisions of Section
      6.01, 12.03, 12.05, 12.06 and 12.07 shall survive any termination hereof
      pursuant to Section 11.01.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      12

    Miscellaneous

     

    Section
      12.01  .  Notices.  All
      notices and other communications hereunder shall be in writing (including
      facsimile transmission, with confirmation of receipt) and shall be deemed to
      have been duly given (i) when delivered personally or by facsimile, (ii) when
      received by the addressee, if sent by Express Mail, Federal Express or other
      express delivery service (receipt requested), or (iii) three business days
      after
      being sent by registered or certified mail, return receipt requested, in each
      case to the other party at the following addresses (or to such other address
      for
      a party as shall be specified by like notice, provided that notices of a change
      of address shall be effective only upon receipt thereof):

     

    if
      to
      Buyer to:

     

    HARVARD
      HOLDINGS INTERNATIONAL, INC.

    3455
      Peachtree Road, Suite 500

    Atlanta,
      Georgia 30326

    FAX
      +1
      (954) 212-7751

    

     

    if
      to
      Seller to:

     

    GRANTECH
      AVIATION INC

    1020
      NW
      62ND
      ST

    HANGAR
      9

    FT
      LAUDERDALE, FLORIDA

    FAX
      + 1
      (954) 491-1805

    

    provided
      that any communication by facsimile shall be confirmed by a copy sent via
      overnight mail to the physical address of the recipient set forth
      above.  All such notices, requests and other communications shall be
      deemed received on the date of receipt by the recipient thereof if received
      prior to 5 p.m. in the place of receipt and such day is a Business Day in the
      place of receipt.  Otherwise, any such notice, request or
      communication shall be deemed not to have been received until the next
      succeeding Business Day in the place of receipt.

     

    Section
      12.02  .  Amendments
      and Waivers.  (a) Any provision of this Agreement
      may be amended or waived only if such amendment or waiver is in writing and
      is
      signed, in the case of an amendment, by each party to this Agreement, or in
      the
      case of a waiver, by the party against whom the waiver is to be
      effective.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    (b)  No
      failure or delay by any party in exercising any right, power or privilege
      hereunder shall operate as a waiver thereof, nor shall any single or partial
      exercise thereof preclude any other or further exercise thereof or the exercise
      of any other right, power or privilege.  The rights and remedies
      herein provided shall be cumulative and not exclusive of any rights or remedies
      provided by law.

     

    Section
      12.03  .  Expenses.  Except
      as otherwise provided herein, all costs and expenses incurred in connection
      with
      this Agreement shall be paid by the party incurring such cost or
      expense.

     

    Section
      12.04  .  Successors
      and Assigns.  The provisions of this Agreement shall be binding
      upon and inure to the benefit of the parties hereto and their respective
      successors and assigns; provided that no party may assign, delegate or otherwise
      transfer any of its rights or obligations under this Agreement without the
      consent of each other party hereto.

     

    Section
      12.05  .  Governing
      Law.  This Agreement shall be governed by and construed in
      accordance with the law of the State of Georgia, without regard to the conflicts
      of law rules of such state.

     

    Section
      12.06  .  Jurisdiction.  The
      parties hereto agree that any suit, action or proceeding seeking to enforce
      any
      provision of, or based on any matter arising out of or in connection with,
      this
      Agreement or the transactions contemplated hereby shall be brought in the United
      States District Court for the Southern District. In any such suit, action or
      proceeding each party irrevocably waives, to the fullest extent permitted by
      law, any objection that it may now or hereafter have to the laying of the venue
      of any such suit, action or proceeding in any such court or that any such suit,
      action or proceeding brought in any such court has been brought in an
      inconvenient forum.  

     

    Section
      12.07  .  WAIVER
      OF JURY TRIAL.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
      WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT
      OF
      OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
      HEREBY.

     

    Section
      12.08  .  .  Counterparts;
      Effectiveness; Third-Party Beneficiaries.  This Agreement may be
      signed in any number of counterparts, each of which shall be an original, with
      the same effect as if the signatures thereto and hereto were upon the same
      instrument.  No provision of this Agreement is intended to confer any
      rights, benefits, remedies, obligations or liabilities hereunder upon any Person
      other than the parties hereto and their respective successors and
      assigns.

     

    Section
      12.09  .  Entire
      Agreement.  This Agreement (including the Schedules and Exhibits
      hereto), the Confidentiality Agreement and the Related Agreements constitute
      the
      entire agreement between the parties with respect to the subject matter of
      this
      Agreement and supersedes all prior agreements and understandings, both oral
      and
      written, between the parties with respect to the subject matter of this
      Agreement.

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    Section
      12.10  .  Severability.  If
      any term, provision, covenant or restriction of this Agreement is held by a
      court of competent jurisdiction or other authority to be invalid, void or
      unenforceable, the remainder of the terms, provisions, covenants and
      restrictions of this Agreement shall remain in full force and effect and shall
      in no way be affected, impaired or invalidated so long as the economic and
      legal
      substance of the transactions contemplated hereby is not affected in any manner
      materially adverse to any party.  Upon such a determination, the
      parties shall negotiate in good faith to modify this Agreement so as to effect
      the original intent of the parties as closely as possible in an acceptable
      manner in order that the transactions contemplated hereby be consummated as
      originally contemplated to the fullest extent possible.IN WITNESS WHEREOF,
      the
      parties hereto have caused this Agreement to be duly executed by their
      respective authorized officers as of the day and year first above
      written.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    
      	 	 	
               By:

            	 
	 	 	 	Name:Arnold
              B. Leonora
	 	 	 	
              Title:Chairman
                & CEO

              HARVARD
                HOLDINGS

              INTERNATIONAL,
                INC.

            
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	
              By:

            	 
	 	 	 	
              Name:Michael
                Grant

            
	 	 	 	
              Title:President

              GRANTECH
                AVIATION INC.

            

    

     

     

    Acknowledgement:

     

    STATE
      OF
      _________________________

     

    COUNTY
      OF
      _______________________

     

    The
      foregoing instrument was acknowledged before me this _____ day of
      ____________________, 20____ by _____________________________ [YOUR FULL LEGAL
      NAME], who is personally known to me or who has produced
      ________________________________ as identification.

     

     

    
      

    

    Signature
      – Notary Public

     

     

    
      
        

      

    

    Name

     

    

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    Intentionally
      left blank

     

     

     

     

     

     

     

     

    26bpl_sb2a1-ex1045.htm

    Exhibit
      10.45

     

    
      REFORMATION
        AGREEMENT

      

      This
        Reformation Agreement (this “Agreement”) is effective as of June 13,
        2007, by and among BPO Management Services, Inc., a Delaware corporation
        (the
“Company”), and the purchasers listed on the signature pages hereto (the
“Purchasers”).  Each of the Company and the Purchasers is
        individually referred to herein as a “Party” and are, collectively, the
“Parties.”

      

      RECITALS

       

      WHEREAS,
        the Parties entered into that certain Series D Convertible Preferred Stock
        Purchase Agreement dated as of June 13, 2007 (the “Stock Purchase
        Agreement”) and certain other documents required by, or provided for in, the
        Stock Purchase Agreement (together with the Stock Purchase Agreement, the
        “Transaction Documents”);

       

      WHEREAS,
        pursuant to the Transaction Documents, the Purchasers purchased an aggregate
        of
        1,458,333.8 shares of the Company’s Series D Convertible Preferred Stock, Series
        A, B, C, and D Warrants exercisable for the purchase of an aggregate of
        approximately 70.0 million shares of the Company’s common stock, and Series J
        Warrants exercisable for the purchase of an aggregate of 1,458,333.8 shares
        of
        the Company’s Series D-2 Convertible Preferred Stock, for an aggregate purchase
        price of approximately $14 million (the “Investment Funds”);

       

      WHEREAS,
        the agreed-upon use of the proceeds from the Transaction Documents was for
        the
        completion of certain specified acquisitions and such other subsequent
        acquisitions as, under certain circumstances, might be proposed by the Company,
        subject to certain approval provisions in favor of the Purchasers, as well
        as to
        fund the Company’s general working capital requirements;

       

      WHEREAS,
        the Parties’ intention in connection with the transactions contemplated by the
        Transaction Documents (collectively, the “Transaction”) was that
        (a) the Purchasers were purchasing, for their own account for the purpose
        of investment and not with a view to or for sale in connection with
        distribution, equity capital and warrants exercisable for the purchase of
        equity
        securities of the Company, (b) the Company’s obligation to issue its equity
        securities upon conversion of the Series D Convertible Preferred Stock and
        upon
        exercise of the warrants purchased in the Transaction was absolute and
        unconditional, (c) the Company would not treat the Series D Convertible
        Preferred Stock in any way other than as equity capital or the dividends
        paid
        thereon other than as dividends paid on equity capital, and (d) the dividends
        paid on the Series D Convertible Preferred Stock would be eligible for the
        dividends received deduction provided by Section 243(a)(1) of the Internal
        Revenue Code of 1986, as amended, or any successor provision thereto; by
        way of
        illustration (and not limitation), see Sections 2.1(cc), 2.2(d), 3.10 and
        8.1 of
        the Stock Purchase Agreement evidencing such intent;

       

      WHEREAS,
        the Transaction Documents referenced an “Acquisition Failure,” which event could
        occur if the Company were to fail to use at least $10 million of the Investment
        Funds for the completion of certain specified acquisitions that the Purchasers
        approved in the Transaction Documents (two of which were consummated shortly
        after the closing of the Transaction) and such other subsequent acquisitions
        as,
        under certain circumstances, might be proposed by the Company, subject to
        certain approval provisions in favor of the Purchasers; and the Transaction
        Documents provide that upon the occurrence of an Acquisition Failure, the
        Company is to redeem a pro rata portion of the Series D Convertible Preferred
        Stock and the warrants purchased in the Transaction (“Acquisition Failure
        Redemption”);

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      WHEREAS,
        the Parties intended that the Transaction fully close on June 13, 2007, and
        each
        of the Parties confirms that it had no intention of causing or permitting
        an
        Acquisition Failure to occur, which could, thereby, trigger an Acquisition
        Failure Redemption;

       

      WHEREAS,
        contrary to the stated intentions of the Parties and covenants of the Company
        that the Investment Funds were always to be classified as having been paid
        for
        the purchase of equity capital and warrants exercisable for the purchase
        of
        equity securities of the Company, the concept of an Acquisition Failure could
        cause, under United States generally accepted accounting principles, a portion
        of the Investment Funds to be characterized as a mezzanine loan to the Company
        and certain of the warrants to be characterized as derivative liabilities
        and
        treated as debt, rather than as equity capital; and

       

      WHEREAS,
        in light of the apparent internal inconsistency in the Transaction Documents
        between (a) treatment of the Transaction as wholly a purchase of equity capital
        and warrants exercisable for the purchase of equity securities of the Company,
        as intended by the Parties, and (b) treatment of the Transaction as partially
        a
        purchase of equity and partially as a mezzanine loan and related derivative
        instrument debt to the Company, as unintentionally drafted by counsel in
        the
        Transaction immediately prior to closing without the understanding by the
        Parties that the accounting implications of such language were contrary to
        their
        business agreements, the Parties desire to reform the Transaction Documents
        to
        (x) memorialize and confirm their intent, understanding and agreement that
        the
        Transaction was solely a purchase of equity capital and warrants exercisable
        for
        the purchase of equity securities of the Company and (y) remove any
        apparent inconsistency caused by the drafting by counsel to the
        Parties.

       

      NOW,
        THEREFORE, in consideration of the premises and covenants made herein, and
        for
        such other good and valuable consideration, the receipt and sufficiency of
        which
        are hereby acknowledged, the Parties hereby agree as follows:

       

      1.  Reformation
        of Transaction Documents.  In order to resolve the apparent
        internal inconsistency in the Transaction Documents, the Parties agree that
        each
        and every appearance of the words “Acquisition Failure,” “Acquisition Failure
        Redemption,” “Acquisition Failure Percentage,” “Acquisition Failure Amount,”
“Acquisition Failure Redemption Amount,” “Acquisition Failure Redemption Price,”
and similar such words or derivations therefrom shall be deleted from the
        Transaction Documents.  By way of clarification (and not of
        limitation), the Parties agree as follows:

      

      a.  Clause
        (a) in its entirety shall be deleted from Section 2.1(ll) of the Stock Purchase
        Agreement;

      b.  Section
        3.11(b) in its entirety shall be deleted from the Stock Purchase
        Agreement;

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      c.  Section
        8(h) shall be deemed waived by the Purchasers (on their own behalf and on
        behalf
        of any successor or assign of Purchasers) from both (i) the Certificate of
        Designation of the Relative Rights and Preferences of the Series D Convertible
        Preferred Stock of the Company and (ii) the Certificate of Designation of
        the
        Relative Rights and Preferences of the Series D-2 Convertible Preferred Stock
        of
        the Company.  Each of the Purchasers hereby (x) agrees that it
        shall give written notice of such waiver to any successor or assign of the
        Purchaser and (y) consents to (I) the amendment of each such Certificate
        of
        Designation solely to delete Section 8(h) in its entirety and (II) the filing
        by
        the Company of such amended Certificates of Designation with the Secretary
        of
        State of the State of Delaware.

      d.  Section
        4(j) in its entirety shall be deleted from each and every Series A, B, J,
        C and
        D Warrant issued by the Company to the Purchasers.

      

      2.  General.

      

      a.  Entire
        Agreement.  Except as reformed by this Agreement, the Transaction
        Documents remain unmodified and in full force and effect.  In the
        event of any inconsistency between the provisions of the Transaction Documents
        and the provisions of this Agreement, the provisions of this Agreement shall
        prevail.  The Transaction Documents, as reformed by this Agreement,
        contain the entire understanding among the Parties and supersede any prior
        written or oral agreements between them respecting the subject matter contained
        herein.  There are no representations, agreements, arrangements or
        understandings, oral or written, between and among the Parties relating to
        the
        subject matter hereof that are not fully expressed herein.

      

      b.  Amendments
        and Waivers.  The provisions of this Agreement, including the
        provisions of this sentence, may not be amended, modified or supplemented,
        and
        waivers or consents to departures from the provisions hereof may not be given,
        unless the same shall be in writing and signed by the Company and holders
        of at
        least seventy-five percent (75%) of the Series D and Series D-2 Convertible
        Preferred Stock then-outstanding.

      

      c.  Notices.  Notice
        given hereunder shall be given in accordance with Section 9.4 of the Stock
        Purchase Agreement.

      

      d.  Successors
        and Assigns.  This Agreement shall be binding upon and inure to
        the benefit of the Parties and their successors and permitted
        assigns.  The Company may not assign this Agreement or any of its
        rights or obligations hereunder without the prior written consent of each
        Purchaser.  Each Purchaser may assign its rights hereunder in the
        manner and to the Persons (as defined in the Registration Rights Agreement
        among
        the Parties dated as of June 13, 2007) as permitted under the Stock
        Purchase Agreement.

      

      e.  Counterparts.  This
        Agreement may be executed in any number of counterparts, each of which when
        so
        executed shall be deemed to be an original and, all of which taken together,
        shall constitute one and the same Agreement and shall become effective when
        counterparts have been signed by each Party and delivered to the other Parties,
        it being understood that all Parties need not sign the same
        counterpart.  In the event that any signature is delivered by
        facsimile or PDF transmission, such signature shall create a valid binding
        obligation of the Party executing (or on whose behalf such signature is
        executed) the same with the same force and effect as if such facsimile or
        PDF
        signature were the original thereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      f.  Governing
        Law; Jurisdiction.  This Agreement shall be governed by and
        construed in accordance with the internal laws of the State of New York,
        without
        giving effect to any of the conflicts of law principles which would result
        in
        the application of the substantive law of another jurisdiction.  This
        Agreement shall not be interpreted or construed with any presumption against
        the
        Party causing this Agreement to be drafted.  The Company and the
        Purchasers agree that venue for any dispute arising under this Agreement
        will
        lie exclusively in the state or federal courts located in New York County,
        New
        York, and the Parties irrevocably waive any right to raise forum non
        conveniens or any other argument that New York is not the proper
        venue.  The Company and the Purchasers irrevocably consent to personal
        jurisdiction in the state and federal courts of the state of New
        York.  The Company and the Purchasers consent to process being served
        in any such suit, action or proceeding by delivering a copy thereof to such
        Party at the address in effect for notices to it under this Agreement and
        agrees
        that such service shall constitute good and sufficient service of process
        and
        notice thereof.  Nothing in this Section 2(f) shall affect or limit
        any right to serve process in any other manner permitted by law.  The
        Company and the Purchasers hereby agree that the prevailing party in any
        suit,
        action or proceeding arising out of or relating to this Agreement or the
        Stock
        Purchase Agreement, shall be entitled to reimbursement for reasonable legal
        fees
        from the non-prevailing party.  The Parties hereby waive all rights to
        a trial by jury.

      

      g.  Severability.  If
        any term, provision, covenant or restriction of this Agreement is held to
        be
        invalid, illegal, void or unenforceable in any respect, the remainder of
        the
        terms, provisions, covenants and restrictions set forth herein shall remain
        in
        full force and effect and shall in no way be affected, impaired or invalidated,
        and the Parties shall use their reasonable efforts to find and employ an
        alternative means to achieve the same or substantially the same result as
        that
        contemplated by such term, provision, covenant or restriction.  It is
        hereby stipulated and declared to be the intention of the
        Parties that they would have executed the remaining terms, provisions, covenants
        and restrictions without including any of such that may be hereafter declared
        invalid, illegal, void or unenforceable.

      

      h.  Headings.  The
        headings herein are for convenience only, do not constitute a part of this
        Agreement and shall not be deemed to limit or affect any of the provisions
        hereof.

      

      i.  Shares
        Held by the Company and its Affiliates.  Whenever the consent or
        approval of holders of a specified percentage of the Series D or Series D-2
        Convertible Preferred Stock is required hereunder, any such class of stock
        held
        by the Company or its affiliates (other than any Purchaser or transferees
        or
        successors or assigns thereof if such Purchaser is deemed to be an affiliate
        solely by reason of its holdings of such securities) shall not be counted
        in
        determining whether such consent or approval was given by the holders of
        such
        required percentage.

      

      

      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK]

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      IN
        WITNESS WHEREOF, the Parties have
        caused this Reformation Agreement to be duly executed by their respective
        authorized persons as of the date first indicated above.

      

      
        	 	
                BPO
                  MANAGEMENT SERVICES, INC.

              
	 	 
	 	 
	 	
                By: /s/
                  Patrick Dolan 

              
	 	
                
                  

                

                Name:
                  Patrick Dolan

              
	 	
                Title:
                  Chairman & CEO

              
	 	 
	 	
                PURCHASERS:

              
	 	 
	 	
                VISION
                  OPPORTUNITY MASTER FUND, LTD.:

              
	 	 
	 	 
	 	
                By:
                  /s/ Adam Benowitz

              
	 	
                
                  

                

                Name: 
                  Adam Benowitz

              
	 	
                Title: 
                  Director

              
	 	 
	 	 
	 	
                RENAISSANCE
                  US GROWTH INVESTMENT TRUST PLC:

              
	 	 
	 	 
	 	
                By:
                  /s/ Z. Eric Stephens 

              
	 	
                
                  

                

                Name:
                  Z. Eric Stephens

              
	 	
                Title:
                  VP of RENN Capital Group, the

                Company's
                  investment adviser

              
	 	 
	 	 
	 	
                RENAISSANCE
                  CAPITAL GROWTH & INCOME FUND III, INC.:

              
	 	 
	 	 
	 	
                By:
                  /s/ Z. Eric Stephens 

              
	 	
                
                  

                

                Name:
                  Z. Eric Stephens

              
	 	
                Title:
                  VP of RENN Capital Group, the

                Company's
                  investment
                  adviser

              

      

      

      

      [Signature
        Page to Reformation Agreement]

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        
          	 	
                  US
                    SPECIAL OPPORTUNITIES TRUST PLC:

                
	 	 
	 	 
	 	
                  By:
                    /s/ Z. Eric Stephens 

                
	 	
                  
                    

                  

                  Name:
                    Z. Eric Stephens

                
	 	
                  Title:
                    VP of RENN Capital Group, the

                  Company's
                    investment adviser

                
	 	 
	 	 
	 	
                  PREMIER
                    RENN US EMERGING GROWTH FUND LTD.:

                
	 	 
	 	 
	 	
                  By:
                    /s/ Z. Eric Stephens 

                
	 	
                  
                    

                  

                  Name:
                    Z. Eric Stephens

                
	 	
                  Title:
                    VP of RENN Capital Group, the

                  Company's
                    investment adviser

                
	 	 
	 	
                  BRIDGEPOINTE
                    MASTER FUND LTD.:

                
	 	 
	 	 
	 	
                  By:
                    /s/ Eric S. Swartz

                
	 	
                  
                    

                  

                  Name:
                    Eric S. Swartz

                
	 	
                  Title:
                    Director

                
	 	 
	 	 
	 	
                  HELLER
                    CAPITAL INVESTMENTS LLC:

                
	 	 
	 	 
	 	
                  By:
                    /s/ Ronald I. Heller 
                    

                  

                
	 	
                  Name:
                    Ronald I. Heller

                
	 	
                  Title:
                    CIO

                

        

      

       

      [Signature
        Page to Reformation Agreement]

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