Press Release: Keshan Global Ltd. Defaults on Joint Venture Agreement

ADMINISTRATIVE OFFICE

120 Eglinton Avenue East, Suite 500 Tel: + 416-481-9333
Toronto, Ontario, Canada M4P 1E2 Fax: + 416-322-3129
Web Site: www.hinesaircraft.com

J. Paul Hines, President and Chief Executive Officer of Hines Aircraft, Ltd. today announced that Keshan Global, Ltd. of Bihar, India is in default of their Investment and Joint Venture Agreement.

The Agreement, dated June 22, 2010 and signed July 15, 2010 by Keshan Global CEO and Managing Director, Manoz Keshan, was the result of months of negotiations and called for an initial deposit of USD$3 million and a total equity investment in Hines Aircraft, Ltd of USD$165 million. As part of the Agreement, two separate Joint Venture entities also were to be established in India with a total additional equity investment by Keshan Global of USD$500 million. One Joint Venture was to manufacture commercial aircraft having more than 20 seats, and the other was to distribute Hines aircraft under 20 seats in Asia.

The Keshan Global Investment in Hines Aircraft was expected to fund the development and production of the revolutionary Hines propulsion system and related aircraft models, as well as establish FAA manufacturing and production operations.

Keshan Global did not make the initial deposit and second advance in accordance with the terms of the Agreement and has failed to provide definitive responses with regard to the fulfillment of the Agreement.

“We are clearly disappointed with the failure of Keshan Global to comply with the terms of the Agreement we negotiated over many months,” said Mr. Hines. “Thankfully, this will not result in a significant delay in the development of our propulsion system and aircraft, which are environmentally “green” and highly efficient. We will continue discussions with potential investors that have expressed interest, but it will take some time,” he said.

Hines Aircraft has retained outside counsel to consider options with respect to the default and payment of a required $3 million breakup fee by Keshan Global.