EXHIBIT 10
AGREEMENT
FOR PURCHASE AND SALE OF SHARES
THIS AGREEMENT is
entered into on this the ember 12 day of September, 2005,
between
No. of
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Calvin E. Bergman
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205 North Center Street
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24.25
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Ney, OH
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43549
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Lynn E. Bergman
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14533 Defiance-Paulding
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24.25
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Cecil, OH
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45821
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Jerry L. Bergman
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310 Tile Mill Drive
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24.25
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Ney, OH
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43549
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Barbara A. Vance
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195 Cleveland Avenue
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24.25
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Ney, OH
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43549
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Marvin Bergman
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1615 East College Street
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3.00
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Iowa City, IA
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52245
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("Sellers") and
Heartland, Inc., a Maryland Corporation, ("Purchaser").
RECITALS
A. Sellers are the owner of all the
issued and outstanding capital shares of Ney Oil Company, an Ohio
corporation, of 145 South Water Street, Ney, Ohio 43549,
hereinafter referred to as the "Corporation."
B. Sellers desire to sell to
Purchaser, and Purchaser desires to purchase from Sellers, all of
the issued and outstanding capital shares of the Corporation upon
the terms and conditions contained herein.
THEREFORE, in consideration of the
mutual promises and conditions herein contained, the parties agree
as follows:
AGREEMENT
(1) Subject to the terms and
conditions of this Agreement, Sellers agree to sell, transfer, and
assign to Purchaser, and Purchaser agrees to purchase, at the
Closing, as hereinafter defined, One Hundred (100) shares of Common
Stock, $1,200.00 per share stated value, of the Corporation,
such
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shares in the aggregate constituting
all of the issued and outstanding capital stock of the Corporation.
At the closing, Sellers shall deliver to Purchaser certificates
evidencing all of the Corporation's outstanding stock in form ready
for transfer and duly endorsed to Purchaser. At the closing,
Sellers shall execute and deliver such other documents and
instruments, and take other such actions, as Purchaser may
reasonably request, in order more fully to vest in Purchaser and
perfect its title to (a) all right, title, and interest in and to
the Corporation's stock; and (b) any and all other right, title,
interest, claim, or demand of any kind which Sellers may have in,
to, or upon any of the properties, assets, or business of the
Corporation.
Purchase Price
(2) The purchase price to be paid by
Purchaser to Sellers for the shares of Common Stock of the
Corporation being sold hereunder shall be Five Million and no/100
Dollars ($5,000,000.00) U.S. Funds.
Payment of Purchase
Price
(3) The purchase price described in
Paragraph (2) hereof shall be paid as follows:
(a) Three Million and no/100 Dollars
($3,000,000.00) in collectible U. S. Funds on the Closing Date;
and
(b) The balance of the purchase
price shall be paid by the issuance to Sellers of one million three
hundred thirty-three thousand three hundred (1,333,300) shares of
common stock in Purchaser, the market value of which, three (3)
business days prior to the Closing Date, shall be no less than Two
Million and no/100 Dollars ($2,000,000.00) U. S. Funds. If the
market value is less than Two Million and no/100 Dollars, the
number of shares will be increased to an amount necessary to
provide Two Million and no/100 Dollars ($2,000,000.00) in value as
of the market closing three (3) business days prior to the Closing
Date of this transaction. Said shares shall be issued to Sellers as
follows:
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Calvin E. Bergman
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323,325
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Lynn E. Bergman
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323,325
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Jerry L. Bergman
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323,325
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Barbara A. Vance
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323,325
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Marvin Bergman
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40,000
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To be adjusted as may be required by
the provisions of this paragraph.
The Closing and the Closing
Date
(4) The Closing Date under this
Agreement shall be within one hundred twenty (120) days from the
date hereof, on such date as Sellers and Purchaser may mutually
agree. The Closing shall be held at Ney Oil on the Closing Date,
unless another time and place are mutually agreed upon.
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Plan of
Acquisition
(5) At the closing, all outstanding
shares of the Corporation shall be transferred to Purchaser in
order to make Purchaser the parent corporation and the Corporation
the wholly owned subsidiary of Purchaser. Prior to the closing,
Purchaser shall have made such arrangements with State Bank and
Trust Company as are necessary to provide at, or prior to closing,
full releases in favor of Calvin E. and Charlotte Bergman, Lynn E.
and Kathy Bergman, Jerry L. Bergman and Barbara A. and Tom Vance,
from all guaranties which they have executed in favor of State Bank
and Trust Company with respect to any and all indebtedness of the
Corporation.
It is the intention of Purchaser
that the Corporation shall continue to exist as a separate
corporation and shall continue to be covered by the laws of the
State of Ohio.
Dissenting
Shareholders
(6) Purchaser shall be responsible
for all matters, both legal and financial, with respect to
dissenting shareholders, it being agreed between the parties that a
condition of the closing of this transaction by Purchaser is that
all shareholders of the Corporation will execute this agreement and
perform all obligations required of them at closing.
At the closing, each of the Sellers
having signed this Agreement will deliver their endorsed stock
certificates or stock powers sufficient to authorize the secretary
of the Corporation to transfer 100% of the outstanding shares of
the Corporation to Purchaser.
Bylaws
(7) It is the intention of Purchaser
that the Bylaws of both Purchaser and the Corporation shall remain
in full force and effect, unchanged.
Representations and Warranties by
Sellers
(8) Sellers represent and warrant to
Purchaser as follows:
Title to the Corporation's
Stock
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(a)
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Sellers have good, absolute, and marketable
title to the Corporation's stock, free and clear of all liens,
claims, encumbrances, and restrictions of every kind. Sellers have
the complete and unrestricted right, power, and authority to sell,
transfer, and assign the Corporation's stock pursuant to this
Agreement. The delivery of the Corporation's Stock to Purchaser as
herein contemplated will vest in Purchaser good, absolute, and
marketable title to all of the Corporation's Stock, free and clear
of all liens, claims, encumbrances, and restrictions of every
kind.
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Organization
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(b)
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The Corporation is a duly organized and validly
existing Ohio corporation in good standing, with all requisite
corporate power and authority to carry on its business as presently
conducted. The Corporation has no subsidiaries and has no direct or
indirect equity interest in any other firm, corporation, or
business enterprise.
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(c)
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Capitalization and long-term
indebtedness.
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(i)
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The Corporation is authorized by its Articles of
Incorporation to issue two hundred fifty (250) shares of Common
Stock, $1,200.00 per share stated value, one hundred (100) of which
are duly and validly issued and outstanding, fully paid, and
nonassessable. The Corporation has no authority to issue any other
capital stock or other security.
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(ii)
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Sellers have delivered to Purchaser true copies
of all instruments relating to the Corporation's long- and
short-term indebtedness, and the Corporation is not in any default
or violation of any provision of its outstanding long-term or
short-term indebtedness.
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(iii)
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There are no outstanding options, contracts,
commitments, warranties, agreements of other rights of any
character affecting or relating in any manner to the issuance of
the Corporation's capital stock or other securities, or entitling
anyone to acquire the Corporation's capital stock or other
securities.
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Financial
Statements
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(d)
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Sellers have furnished Purchaser with an
internally prepared Balance Sheet of the Corporation as of July 31,
2005 and the related statement of income and retained earnings for
the year ended July 31, 2005. Both such financial statements (i)
are in accordance with the books and records of the Corporation;
(ii) fairly present the financial condition of the Corporation at
such dates and the results of its operations for the periods
therein specified; and (iii) with respect to all contract and
commitments of the Corporation, reflect adequate reserves for all
reasonably anticipated losses and costs in excess of anticipated
income. Specifically, but not by way of limitation, the Balance
Sheet discloses all of the debts, liabilities, and obligations of
any nature (whether absolute, accrued, contingent, or otherwise and
whether due or to become due) of the Corporation at the Balance
sheet date (except such debts, liabilities, and obligation as are
not required to be reflected therein in accordance with generally
accepted accounting principles) and includes appropriate reserves
for all taxes and other liabilities accrued or due at such dates
but not yet payable.
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Present Status
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(e)
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Since the Balance Sheet date, the Corporation
has not: incurred any obligations or liabilities, absolute,
accrued, contingent, or otherwise, except current liabilities in
the ordinary course of business; discharge or satisfied any liens
or encumbrances, or paid any obligation or liabilities, except
current Balance Sheet liabilities and current liabilities incurred
since the Balance Sheet date, in each case, in the ordinary course
of business; declared or made any shareholder payment or
distribution or purchased or redeemed any of its securities or
agreed to do so; mortgaged, pledged, or subjected to lien,
encumbrances, or charge any of its assets; canceled any debt or
claim; sold or transferred any assets except sales from inventory
in the ordinary course of business; suffered any damage,
destruction, or loss (whether or not covered by insurance)
materially affecting its properties, business, or prospects; waived
any rights of substantial value; nor entered into any transaction
other than in the ordinary course of business. Sellers have
specifically disclosed to Purchaser that prior to Closing, the
Corporation will pay to Charlotte Bergman the approximately Eighty
Thousand Dollar ($80,000.00) indebtedness owed to the said
Charlotte Bergman.
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Tax Returns and
Audits
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(f)
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The Corporation has duly filed all federal,
state, and local tax returns required to be filed by it and has
paid all federal, state, and local taxes required to be paid with
respect to the periods covered by such returns. The Corporation has
not been delinquent in the payment of any tax, assessment, or
governmental charge. The Corporation has not had any tax
deficiencies proposed or assessed against it and has not executed
any waiver of the statute of limitations on the assessment or
collection of any tax.
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Litigation
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(g)
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There are no legal actions, suits, arbitrations,
or other legal administrative or other governmental proceedings
pending or threatened against the Corporation, its properties,
assets, or business; and neither Sellers nor the Corporation is
aware of any facts which to the knowledge of either might result in
any such action, suit, arbitration, or other proceeding; except
that there is an outstanding dispute with Ottawa Oil Company
involving an original invoice in the amount of Ten Thousand Dollars
($10,000.00) and negotiations continue.
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Compliance With the Law and Other
Instruments
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(h)
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The business and operation of the Corporation
have been and are being conducted in accordance with all applicable
laws, rules, and regulation authorities, except those which do not
(either individually or in the aggregate) materially and adversely
affect the Corporation or its properties, assets, businesses, or
prospects. Performance of this
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Agreement will not result in any
breach of, or constitute a default under, or result in the
imposition of, any lien or encumbrances upon any property of the
Corporation under any arrangement, agreement, or other instrument
to which the Corporation or Sellers is a party or by which either
is bound or affected, and will not violate the Articles of
Incorporation, as amended, or the Code of Regulations of
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