**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**






**FORM
      10-KSB**




**x** **ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF**


**THE
      SECURITIES EXCHANGE ACT OF 1934**




**FOR
      FISCAL YEAR ENDED DECEMBER 31, 2005**




**HEARTLAND,
                INC.**(Name
                of small business issuer in its charter)








**Maryland**
            
            **36-4286069**(State
                or other jurisdiction
              of
                incorporation or organization)
            
            (I.R.S.
                Employer Identification Number)






**25
                Mound Park Drive South****Springboro,
                Ohio 45066**(Address
                of principal executive offices) (Zip Code)




**763.557.2900**


(Issuer’s
      telephone no.)




Securities
      registered pursuant to Section 12(b) of the Exchange Act: None




Securities
      registered pursuant to Section 12(g) of the Exchange Act: Common
      Stock, $.001 par value




Check
      whether the issuer (1) has filed all reports required to be filed by Section
      13
      or 15(d) of the Exchange Act during the past 12 months (or for such shorter
      period that the registrant was required to file such reports), and (2) has
      been
      subject to such filing requirements for the past 90 days.  Yes x No o




Check
      if
      there is no disclosure of delinquent filers in response to Item 405 of
      Regulation S-B not contained in this form, and no disclosure will be contained,
      to the best of the registrant’s knowledge, in definitive proxy or information
      statements incorporated by reference in Part III of this Form 10- KSB or any
      amendment to this Form 10-KSB. x




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act)  o Yes x
      No





Issuer’s
                revenues for its most recent fiscal year ended December 31, 2005
                were:
            $40,674,714




The
      aggregate market value of the Registrant’s voting common stock held by
      non-affiliates of the registrant as of May 17, 2006, was approximately:
      $8,439,379 at $0.50 price per share. Number of shares of the registrant’s common
      stock outstanding as of May 17,2006 was: 25,128,858.










HEARTLAND
        INC.
 FORM
        10-KSB
  TABLE
        OF
        CONTENTS
  Item
                  #
              
              Description
              
              Page
                  NumbersPART
                  IITEM
                  1.
              
              Business
                  of the Company
              
              3ITEM
                  2.
              
              Properties
              
              13ITEM
                  3.
              
              Legal
                  Proceedings
              
              14ITEM
                  4.
              
              Submissions
                  of Matters to a Vote of Security Holders
              
              15
  PART
                  IIITEM
                  5.
              
              Market
                  for Registrant’s Common Equity, Related Stockholder
                Matters,
                  and Issuer Purchases of Equity Securities
              
              15ITEM
                  6.
              
              Management’s
                  Discussion and Analysis of Financial Condition
                and
                  Results of Operations
              
              24ITEM
                  7.
              
              Financial
                  Statements
              
              27ITEM
                  8.
              
              Changes
                  in and Disagreements with Accountants on Accounting
                and
                  Financial Disclosure
              
              50ITEM
                  8A.
              
              Controls
                  and Procedures
              
              50ITEM
                  8B.
              
              Other
                  Information
              
              50
  PART
                  IIIITEM
                  9.
              
              Directors,
                  Executive Officers, Promoters and Control Persons:
                Compliance
                  with Section 16(A) of the Exchange Act
              
              51ITEM
                  10.
              
              Executive
                  Compensation
              
              53ITEM
                  11.
              
              Security
                  Ownership of Certain Beneficial Owners and Management.
              
              54ITEM
                  12.
              
              Certain
                  Relationships and Related Transactions
              
              55ITEM
                  13.
              
              Exhibits
              
              55ITEM
                  14.
              
              Principal
                  Accountant Fees and Services
              
              57Signatures
              
              61










2



















**PART
      I**






**ITEM
        1    **DESCRIPTION
        OF BUSINESS****




**INTRODUCTION**




**FORWARD-LOOKING
      STATEMENTS** .
      This
      annual report contains certain forward-looking statements within the meaning
      of
      Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
      Securities Exchange Act of 1934, as amended, that involve risks and
      uncertainties. In addition, the Company (Heartland, Inc., a Maryland
      corporation), may from time to time make oral forward-looking statements. Actual
      results are uncertain and may be impacted by many factors. In particular,
      certain risks and uncertainties that may impact the accuracy of the
      forward-looking statements with respect to revenues, expenses and operating
      results include without imitation; cycles of customer orders, general economic
      and competitive conditions and changing customer trends, technological advances
      and the number and timing of new product introductions, shipments of products
      and components from foreign suppliers, and changes in the mix of products
      ordered by customers. As a result, the actual results may differ materially
      from
      those projected in the forward-looking statements.




Because
      of these and other factors that may affect the Company’s operating results, past
      financial performance should not be considered an indicator of future
      performance, and investors should not use historical trends to anticipate
      results or trends in future periods.




**THE
        COMPANY**


The
      Company was incorporated in the State of Maryland on April 6, 1999 as Origin
      Investment Group, Inc. (“Origin”). On December 27, 2001, the Company went
      through a reverse merger with International Wireless, Inc. Thereafter on January
      2, 2002, the Company changed its name from Origin to International Wireless,
      Inc. On November 15, 2003, the Company went through a reverse merger with PMI
      Wireless, Inc. Thereafter in May 2004, the Company changed its name from
      International Wireless, Inc. to Heartland Inc., our current name.




The
      Company was originally formed as a non-diversified closed-end management
      investment company, as those terms are used in the Investment Company Act of
      1940 (“1940 Act”). The Company at that time elected to be regulated as a
      business development company under the 1940 Act. In December 7, 2001 the
      Company’s shareholders voted on withdrawing the Company from being regulated as
      a business development company and thereby no longer be subject to the 1940
      Act.




Unless
      the context indicates otherwise, the terms “Company,” “Corporate”, “Heartland,”
and “we” refer to Heartland, Inc. and its subsidiaries. Our executive offices
      are located at 25 Mound Park Drive South, Springboro, Ohio 45066, telephone
      number (763) 557.2900. Our Internet address is www.heartlandholdingsinc.com
      for
      the corporate information. Additionally, the following divisions of the company
      currently maintain Internet addresses:





·
            Evans
                Columbus -www.evanscolumbusllc.com.


·
            Monarch
                Homes - www.monarchhomesmn.com.


·
            Karkela
                -www.karkela.com.


·
            Mound
                Technologies - www.moundtechnologies.com.





The
      information contained on our web site(s) or connected to our web site is not
      incorporated by reference into this Annual Report on Form 10-KSB and should
      not
      be considered part of this report.




We
      classify our operations  into
      four
      reportable segments:





·
            steel
                fabrication.


·
            construction
                and property management.


·
            Manufacturing.


·
            agriculture
                (currently idle but available for future use).





3


A
      fifth
      segment called “other” consists of corporate functions. Sales of our segments
      accounted for the following approximate percentages of our consolidated sales
      for fiscal year 2005:





·
            Steel
                Fabrication - 19%.


·
            Construction
                and Property Management - 58%.


·
            Manufacturing
                - 23%.




We
      emphasize quality and innovation in our services, products, manufacturing,
      and
      marketing. We strive to provide well-built, dependable products supported by
      our
      service network. We have committed funding for engineering and research in
      order
      to improve existing products and develop new products. Through these efforts,
      we
      seek to be responsive to trends that may affect our target markets now and
      in
      the future.





**BUSINESS
                DEVELOPMENT**




From
      December 27, 2001 through June 2003, the Company attempted to develop its bar
      code technology and bring it to market. To that extent, the Company moved its
      operations to Woburn, Massachusetts, hired numerous computer programmers,
      developers and sales people in addition to support staff. Due to the Company’s
      inability to raise sufficient capital, the Company was unable to pay current
      operating expenses and by June, 2003 shut down its operations
      entirely.




On
      August
      29, 2003, a change in control of the Company occurred in conjunction with the
      naming Jerry Gruenbaum, Esq. of First Union Venture Group, LLC as attorney
      of
      record for the purpose of overseeing the proper disposition of the Company
      and
      its remaining assets and liabilities by any means appropriate, including
      settling any and all liabilities to the U.S. Internal Revenue Service and the
      Commonwealth of Massachusetts’ Attorney General’s office for unpaid
      wages.




In
      conjunction with naming Jerry Gruenbaum, Esq. of First Union Venture Group,
      LLC
      as attorney of record for the purpose of overseeing the proper disposition
      of
      the Company and its remaining assets and liabilities, the Company issued First
      Union Venture Group, LLC, a Nevada Limited Liability Company, Thirty Million
      (30,000,000) newly issued common shares as consideration for their services.
      In
      addition, the Company canceled any and all outstanding options, warrants, and/or
      debentures not exercised to date. The Company further nullified any and all
      salaries, bonuses, and benefits including severance pay and accrued salaries
      to
      Stanley A. Young and Michael Dewar.




On
      November 12, 2003, the Company approved the spin-off of the two subsidiaries
      of
      the Company and any and all remaining assets of the Company, including any
      intellectual property, to enable the Company to pursue a suitable merger
      candidate. In addition, the Company approved a 30 to 1 reverse split of all
      existing outstanding common shares of the Company. Following the 30 to 1 reverse
      split, the Company had 1,857,137 shares of common stock
      outstanding.




On
      November 15, 2003, a change in control of the Company occurred when the Company
      went through a reverse merger with PMI Wireless, Inc., a Delaware corporation
      with corporate headquarters located in Cordova, Tennessee. The acquisition,
      took
      place on December 1, 2003 for the aggregate consideration of fifty thousand
      dollars ($50,000) which was paid to the U.S. Internal Revenue Service for the
      Company’s prior obligations, plus assumption of the Company’s existing debts,
      for 9,938,466 newly issued common shares of the Company. Under the said reverse
      merger, the former Shareholders of PMI Wireless ended up owning an 84.26%
      interest in the Company.




On
      December 10, 2003, the Company entered into an Acquisition Agreement to acquire
      100% of Mound Technologies, Inc. (“Mound”), a Nevada corporation with its
      corporate headquarters located in Springboro, Ohio. The acquisition was a stock
      for stock exchange in which the Company acquired all of the issued and
      outstanding common stock of Mound in exchange for 1,256,000 newly issued shares
      of its common stock. As a result of this transaction, Mound became a wholly
      owned subsidiary of the Company.




4


In
      May
      2004, the Company changed its name from International Wireless, Inc. to our
      current name, Heartland, Inc.




On
      December 27, 2004, the Company entered into an Acquisition Agreement to acquire
      100% of Monarch Homes, Inc. (“Monarch”), a Minnesota corporation with its
      corporate headquarters located in Ramsey, MN for $5,000,000. The acquisition
      price was made up of:





·
            $100,000
                at closing,


·
            a
                promissory note of $1,900,000 payable on or before February 15, 2005
                which, if not paid by that date, interest shall be due from then
                to actual
                payment at 8%, simple interest, compounded annually, and


·
            six
                hundred sixty-seven thousand (667,000) restricted newly issued shares
                of
                the Company’s common stock provided at closing.





In
      the
      event the common stock of the Company not is trading at a minimum of $5.00
      as of
      December 27, 2005, the Company was required to compensate the original Monarch
      shareholders for the difference in additional stock. As a result of the
      aforementioned, the Company has agreed to isssue the former Monarch shareholders
      333,000 shares of common stock. Monarch is a wholly owned subsidiary of the
      Company.




On
      December 30, 2004, the Company entered into an Acquisition Agreement to acquire
      100% of Evans Columbus, LLS (“Evans”), an Ohio corporation with its corporate
      headquarters located in Blacklick, OH for $3,005,000. The acquisition price
      was
      paid as follows:





·
            $5,000
                at closing, and


·
            600,000
                restricted newly issued shares of the Company’s common stock provided at
                closing.





In
      the
      event the common stock of the Company is not trading at a minimum of $5.00
      as of
      December 30, 2005, the Company was required to compensate the original Evans
      shareholders for the difference in additional stock. As a result of the
      aforementioned, the Company is in dispute with Evans who claims as of January
      2006 that his acquisition contract is null and void. Evans is a wholly owned
      subsidiary of the Company.




On
      December 31, 2004, the Company entered into an Acquisition Agreement to acquire
      100% of Karkela Construction, Inc., a Minnesota corporation with its corporate
      headquarters located in St. Louis Park, MN for $3,000,000. The acquisition
      price
      consisted of the following:





·
            $100,000
                at closing,


·
            a
                short term promissory note payable of $50,000 on or before January
                31,
                2005,


·
            a
                promissory note of $1,305,000 payable on or before March 31, 2005
                which,
                if not paid by that date, interest is due from December 31, 2004
                to actual
                payment at 8%, simple interest, compounded annually and


·
            500,000
                restricted newly issued shares of the Company’s common stock provided at
                closing.





In
      the
      event the common stock of the Company is not trading at a minimum of $4.00
      as of
      December 31, 2005, the Company was required to compensate the original Karkela
      shareholders for the difference in additional stock. As a result of the
      aforementioned, the Company issued the former Karkela shareholders 262,500
      shares of common stock on March 15, 2006. Karkela is a wholly owned subsidiary
      of the Company.





5


On
      July
      29, 2005, the Company entered into a binding Stock Purchase Agreement with
      Steven Persinger, an individual, to acquire all the issued and outstanding
      shares of common stock of Persinger Equipment, Inc., a Minnesota corporation
      (“Persinger”) for $4,735,000. The acquisition price consists of the following:





·
            $2,000,000
                in cash on or before February 1, 2006, and


·
            $2,735,000,
                payable in cash or 911,667 non-restricted shares of common stock
                of the
                Company at the Company’s option payable at closing.





In
      the
      event the common stock of the Company is not trading at a minimum of $3.00
      as of
      July 29, 2006, the Company is required to compensate Mr. Persinger for the
      difference in additional stock. In connection with the Stock Purchase Agreement,
      the Company and Mr. Persinger will enter into an employment agreement for a
      period of 5 years with an annual base salary of $120,000 per year, which
      includes various incentive based provisions. Also in connection with the Stock
      Purchase Agreement, Persinger will continue leasing from Mr. Persinger the
      real
      estate that Persinger operates in its business for as long as Mr. Persinger
      is
      employed by Persinger. Persinger has the right and option to purchase this
      real
      estate during Mr. Persinger’s employment for $600,000.





On
      September 12, 2005, the Company entered into a binding Agreement for Purchase
      and Sale of Shares with Calvin E. Bergman, Lynn E. Bergman, Jerry L. Bergman,
      Barbara A. Vance and Marvin Bergman, individually, to acquire all the issued
      and
      outstanding shares of common stock of Ney Oil Company, an Ohio corporation
      (“Ney
      Oil Company”) for $5,000,000. The acquisition price consisted of:





·
            $3,000,000
                at closing, and


·
            1,333,300
                shares of common stock of the Company valued three business days
                prior to
                the closing to not be less than $2,000,000.





In
      the
      event the value is less than $2,000,000, the number shall increase accordingly.





On
      September 12, 2005, the Company entered into a Letter of Intent with Terry
      Robbins, President of Ohio Valley Lumber, to acquire all the issued and
      outstanding shares of common stock of NKR, Inc, d.b.a. Ohio Valley Lumber,
      a
      Delaware corporation (“NKR”) for $8,000,000.00. The acquisition price was made
      up of:





·
            $4,000,000
                in cash,


·
            2,000,000
                shares of common stock of the Company and


·
            $2,000,000
                in cash for the reduction of NKR’s debt.





The
      Company is still negotiating the terms of the definitive documentation.





On
      September 21, 2005, the Company entered into a binding Acquisition Agreement
      with Terry L. Lee and Gary D. Lee, individually, to acquire all the issued
      and
      outstanding shares of common stock of Lee Oil Company, Inc., a Virginia
      corporation, Lee Enterprises, Inc., a Kentucky corporation and Lee’s Food Marts
      LLC, a Tennessee Limited Liability Company, (collectively hereinafter "Lee
      Oil
      Company") for $6,000,000.00. The acquisition price shall consist of:





·
            $5,000,000.00
                at closing and


·
            $1,000,000.00,
                payable in common stock of the Company valued at the date of closing.





On
      September 26, 2005, the Company entered into a binding Acquisition Agreement
      with Robert Daniel, Karol K. Hart-Bendure, M. Lucille Daniel, and Joe M. Daniel,
      individually, to acquire all the issued and outstanding shares of common stock
      of Schultz Oil Company, Inc., an Ohio Corporation (“Schultz Oil Company”) for
      $3,500,000 consisting of $1,500,000 in cash at closing and 1,000,000 of common
      stock. In the event the common stock of the Company does not have a value of
      at
      least $2.00 as of September 26, 2007, the Company is required to compensate
      the
      shareholders for the difference with the issuance of additional
      shares.





**(C)****BUSINESS**




Our
      mission is to become a leading diversified company with business interests
      in
      well established industries. We plan to successfully grow our revenues by
      acquiring companies with historically profitable results, strong balance sheets,
      high profit margins, and solid management teams in place. By providing access
      to
      financial markets, expanded marketing opportunities and operating expense
      efficiencies, we hope to become the facilitator for future growth and higher
      long-term profits. In the process, we hope to develop new synergies among the
      acquired companies, which should allow for greater cost effectiveness and
      efficiencies, thus further enhancing each individual company’s strengths. To
      date, we have completed acquisitions in the steel fabrication, residential
      and
      commercial construction, and steel drum manufacturing industries. Additionally,
      we have identified acquisition opportunities in gasoline distribution, lumber
      manufacturing, and equipment distribution.




6


We
      are
      headquartered in Plymouth, MN and currently trade on the OTC Bulletin Board
      under the symbol HTLJ.OB. Including the senior management team, we currently
      employs 101 people.




Currently,
      we operate four major subsidiaries in the following segments:




·
            Mound
                Technologies, Inc. of Springboro, OH acquired in December 2003 (Steel
                Fabrication)·
            Evans
                Columbus, LLC of Columbus, OH acquired in December of 2004 (Steel
                Drum
                Manufacturing)





·
            Monarch
                Homes, Inc. of Ramsey, MN, acquired in December of 2004 (Construction
                and
                Property Management).·
            Karkela
                Construction, Inc. of St. Louis Park, MN, acquired in December of
                2004
                (Construction and Property
                Management).




We
      have
      agreements or signed letters of intent to acquire these companies in the
      following segments:




·
            Persinger’s
                Equipment, Inc. of Austin, MN (Agreement signed July 14, 2005) (Equipment
                Distributorship)·
            Lee
                Oil Company, Inc. of Middleboro, KY (Agreement signed September 21,
                2005)
                (Gasoline Distribution)·
            Ney
                Oil Company of Ney, OH (Agreement signed September 12, 2005) (Gasoline
                Distribution)·
            Schultz
                Oil Company of Tifin, OH (Agreement signed September 26, 2005) (Gasoline
                Distribution)·
            Ohio
                Valley Lumber of Piketon, OH (Letter of Intent signed September 12,
                2005)
                (Lumber manufacturing)






**STEEL
      FABRICATION**




Mound
      Technologies, Inc. (“Mound”) was incorporated in the state of Nevada in November
      of 2002, with its corporate offices located in Springboro, Ohio. This business
      includes a Steel Fabrication (“Steel Fabrication”), a Property Management
      Division (“Property Management”) and a wholly owned subsidiary, Freedom Products
      of Ohio (“Freedom”).




The
      Steel
      Fabrication Division and Property Management Division are both located in
      Springboro, Ohio. The Steel Fabrication Division is a full service structural
      and miscellaneous steel fabricator. It also manufactures steel stairs and
      railings, both industrial and architectural quality. The present capacity of
      the
      facility is approximately 6,000 tons per year of structural and miscellaneous
      steel. This division had been previously known as Mound Steel Corporation,
      which
      was started at the same location in 1964.




The
      Steel
      Fabrication Division is focused on the fabrication of metal products. This
      Division produces structural steel, miscellaneous metals, steel stairs,
      railings, bar joists, metal decks and the erection thereof. This Division
      produced gross sales of approximately $7.4 million in 2004. In the steel
      products segment, steel joists and joist girders, and steel deck are sold to
      general contractors and fabricators throughout the United States. Substantially
      all work is to order and no unsold inventories of finished products are
      maintained. All sales contracts are firm fixed-price contracts and are normally
      competitively bid against other suppliers. Cold finished steel and steel
      fasteners are manufactured in standard sizes and inventories are
      maintained.





This
      division’s customers are typically U.S. based companies that require large
      structural steel fabrication, with needs such as building additions, new
      non-residential construction, etc. Customers are typically located within a
      one-day drive from the Company’s facilities. The Company is able to reach 70% of
      the U.S. population, yielding a significant potential customer base. Marketing
      of the Division’s products is done by advertising in industry directories,
      word-of-mouth from existing customers, and by the dedicated efforts of in-house
      sales staff monitoring business developments opportunities within the Company’s
      region. Large clients typically work with the Company on a continual basis
      for
      all their fabricated metal needs.




7


Competition
      overall in the U.S. steel fabrication industry has been reduced by approximately
      50% over the last few years due to economic conditions leading to the lack
      of
      sustained work. The number of regional competitors has gone down from ten (10)
      to three (3) over the past five years. Larger substantial work projects have
      declined dramatically with the downturn in the economy. Given the geographical
      operating territory of the Company, foreign competition is not a major factor.
      In addition to competition, steel pricing represents another significant
      challenge. The cost of steel, our highest input cost, has seen significant
      increases in recent years. The Company will manage this challenge by stockpiling
      the most common steel component products and incorporating price increases
      in
      job pricing as deemed appropriate.




**Competition
      and Other Factors**




We
      are
      subject to a wide variety of federal, state, and international environmental
      laws, rules, and regulations. These laws, rules, and regulations may affect
      the
      way we conduct our operations, and failure to comply with these regulations
      could lead to fines and other penalties.




Competition
      within the steel industry, both in the United States and globally, is intense
      and expected to remain so. Mound competes with large U.S. competitors such
      as
      United States Steel Corporation, Nucor Corporation, AK Steel Holding
      Corporation, Ispat Inland Inc. and IPSCO Inc along with a number of local
      suppliers. The steel market in the United States is also served by a number
      of
      non-U.S. sources and U.S. supply is subject to changes in worldwide demand
      and
      currency fluctuations, among other factors.




More
      than
      35 U.S. companies in the steel industry have declared bankruptcy since 1997
      and
      have either ceased production or more often continued to operate after being
      acquired or reorganized. In addition, many non-U.S. steel producers are owned
      and subsidized by their governments and their decisions with respect to
      production and sales may be influenced by political and economic policy
      considerations rather than by prevailing market conditions. The steel industry
      is highly cyclical in nature and subject to significant fluctuations in demand
      as a result of macroeconomic changes in global economies, including those
      resulting from currency volatility. The global steel industry is also generally
      characterized by overcapacity, which can result in downward pressure on steel
      prices and gross margins.




Mound
      competes with other flat-rolled steel producers (both integrated steel mills
      and
      mini-mills) and producers of plastics, aluminum, ceramics, carbon fiber,
      concrete, glass, plastic and wood that can be used in lieu of flat-rolled steels
      in manufactured products. Mini-mills generally offer a narrower range of
      products than integrated steel mills but can have some cost advantages as a
      result of their different production processes.




Price,
      quality, delivery and service are the primary competitive factors in all markets
      that Mound serves and vary in relative importance according to the product
      category and specific customer.




In
      some
      areas of our business, we are primarily an assembler, while in others we serve
      as a fully integrated manufacturer. We have strategically identified specific
      core manufacturing competencies for vertical integration and have chosen outside
      vendors to provide other products and services. We design component parts in
      cooperation with our vendors, contract with them for the development of tooling,
      and then enter into agreements with these vendors to purchase component parts
      manufactured using the tooling. Operations are also designed to be flexible
      enough to accommodate product design changes required to respond to market
      demand.





**Raw
      Materials**




Mound’s
      business depends on continued access to reliable supplies of various raw
      materials. Mound believes there will be adequate sources of its principal raw
      materials to meet its near term needs, although probably at higher prices than
      in the past.





8


**UNFAIR
      TRADE PRACTICES AND TRADE REMEDIES**




Under
      international agreement and U.S. law, remedies are available to domestic
      industries where imports are “dumped” or “subsidized” and such imports cause
      material injury to a domestic industry. Dumping involves selling for export
      a
      product at a price lower than the same or similar product is sold in the home
      market of the exporter or where the export prices are lower than a value that
      typically must be at or above the full cost of production. Subsidies from
      governments (including, among other things, grants and loans at artificially
      low
      interest rates) under certain circumstances are similarly actionable. The remedy
      available is an antidumping duty order or suspension agreement where injurious
      dumping is found and a countervailing duty order or suspension agreement where
      injurious subsidization is found. When dumping or subsidies continue after
      the
      issuance of an order, a duty equal to the amount of dumping or subsidization
      is
      imposed on the importer of the product. Such orders and suspension agreements
      do
      not prevent the importation of product, but rather require either that the
      product be priced at an undumped level or without the benefit of subsidies
      or
      that the importer pay the difference between such undumped or unsubsidized
      price
      and the actual price to the U.S. government as a duty.




**SECTION
      201 TARIFFS**




On
      March
      20, 2002, in response to an investigation initiated by the office of the
      President of the United States under Section 201 of the Trade Act of 1974,
      the
      President of the United States imposed a remedy to address the serious injury
      to
      the domestic steel industry that was found. The remedy was an additional tariff
      on specific products up to 30% (as low as 9%) in the first year and subject
      to
      reductions each year. The remedy provided was potentially for three years and
      a
      day, subject to an interim review after 18 months as to continued need. On
      December 4, 2003 by Proclamation 7741, the President of the United States
      terminated the import relief provided under this law pursuant to Section 204(b)
      (1) (A) of the Trade Act of 1974 on the basis that “the effectiveness of the
      action taken under Section 203 has been impaired by changed economic
      circumstances” based upon a report from the U.S. International Trade Commission
      and the advice from the Secretary of Commerce and the Secretary of Labor. Thus,
      no relief under this law was provided to domestic producers during
      2004.




**ENVIRONMENTAL
      MATTERS**




Mound’s
      operations are subject to a broad range of laws and regulations relating to
      the
      protection of human health and the environment. Mound expects to expend in
      the
      future, substantial amounts to achieve or maintain ongoing compliance with
      U.S.
      federal, state, and local laws and regulations, including the Resource
      Conservation and Recovery Act (RCRA), the Clean Air Act, and the Clean Water
      Act. These environmental expenditures are not projected to have a material
      adverse effect on Mound’s financial position or on Mound’s competitive position
      with respect to other similarly situated U.S. steelmakers subject to the same
      environmental requirements.




**Construction
      and Property Management**




**a)****Monarch
                Homes, Inc.**




Monarch
      Homes, Inc., (“Monarch”) acquired in December 2004, is a builder of custom
      residential homes in the state of Minnesota. Monarch is located in Ramsey,
      MN,
      and was acquired in December of 2004. Our domestic homebuilding operations
      currently involve the purchase and development of land or lots and the
      construction and sale of single-family homes, town homes and low-rise
      condominiums. Monarch was founded in 1995 and had annual sales of approximately
      $23 million during 2004. Over the course of the past ten years, Monarch has
      become one of the region’s premier builders of quality homes in planned
      communities in the northern and northwestern suburbs of Minneapolis and St.
      Paul, Minnesota. In fiscal 2005, Monarch sold 55 homes, including first-time,
      move-up and, in some markets, custom homes, ranging in price from approximately
      $160,000 to $600,000. The average sales price in fiscal 2005 was approximately
      $275,000.




Our
      practice has been to acquire land, build homes on the land and sell the homes
      within 24 to 36 months from the date of land acquisition. Generally, this
      involves acquiring land that is properly zoned and is either ready for
      development or, to some degree, already developed. We control a substantial
      amount of our land, including lots and land to be developed into lots, through
      option agreements that we can exercise over specified time periods or, in
      certain cases, as the land or lots are needed. At December 31, 2005, Monarch
      owned approximately 50 lots and has eight to ten exclusive agreements with
      developers. Our growth strategy for Monarch has been focused primarily on
      organic growth opportunities through land acquisition and development in
      existing business units and markets.




9


It
      is the
      intent of the Company to expand this business unit into the construction of
      super energy efficient homes using new EPS technology that allows for custom
      construction, with greatly increased “R” ratings. An agreement is in process to
      have exclusive rights to this type of construction product in the area of
      Central America. The company believes that this will reduce the seasonality
      associated with the construction industry.




**b)****Karkela
                Construction, Inc.**




Karkela
      Construction, Inc. (“Karkela”) was acquired in December 2004 and is located in
      St. Louis Park, MN. Karkela was acquired in December 2004 and is a general
      contractor in the greater St. Paul and Minneapolis, Minnesota area specializing
      in commercial, industrial, hospitality or multi-family space. More specifically,
      Karkela is a designer and builder of custom office buildings for medical,
      financial and other service type businesses. Karkela was originally founded
      in
      1983 and incorporated in 1990. During fiscal year 2005, Karkela had revenues
      of
      approximately $8.6 million. It is the intent of Heartland to expand that
      territory to include those geographies where the company can benefit from its
      reputation.




**Competition
      and Other Factors**




The
      conventional construction industry is essentially a “local” business and is
      highly competitive. Monarch and Karkela compete in each market with numerous
      other homebuilders and general construction companies, including national,
      regional and local builders. The industries top six competitors based on
      revenues for their most recent fiscal year-end are as follows: Beazer Homes
      USA,
      Inc., D. R. Horton, Inc., KB Homes, Lennar Corporation, Pulte Homes, Inc. and
      The Ryland Group, Inc. The main competitive factors affecting Monarch and
      Karkela operations are location, price, availability of mortgage financing
      for
      customers, construction costs, design and quality of homes, customer service,
      marketing expertise, availability of land, price of land and reputation. We
      believe that Monarch and Karkela compete effectively by building high quality
      units, maintaining geographic diversity, responding to the specific demands
      of
      each market and managing the operations at a local level.




The
      construction industry is affected by changes in national and local economic
      conditions, job growth, long-term and short-term interest rates, consumer
      confidence, governmental policies, zoning restrictions and, to a lesser extent,
      changes in property taxes, energy costs, federal income tax laws, federal
      mortgage financing programs and various demographic factors. The political
      and
      economic environments affect both the demand for construction and the subsequent
      cost of financing. Unexpected climatic conditions, such as unusually heavy
      or
      prolonged rain or snow, may affect operations in certain areas.




The
      construction industry is subject to extensive regulations. The Company and
      its
      subcontractors must comply with various federal, state and local laws and
      regulations, including worker health and safety, zoning, building standards,
      erosion and storm water pollution control, advertising, consumer credit rules
      and regulations, and the extensive and changing federal, state and local laws,
      regulations and ordinances governing the protection of the environment,
      including the protection of endangered species. The Company is also subject
      to
      other rules and regulations in connection with its manufacturing and sales
      activities, including requirements as to incorporate building materials and
      building designs. All of these regulatory requirements are applicable to all
      construction companies, and, to date, compliance with these requirements has
      not
      had a material impact on the operation. We believe that the Company is in
      material compliance with these requirements.




We
      purchase materials, services and land from numerous sources (primarily local
      vendors), and believe that we can deal effectively with the challenges we may
      experience relating to the supply or availability of materials, services and
      land.




The
      results of operations of our Property Management segment may be adversely
      affected by increases in interest rates. Any significant increase in mortgage
      interest rates above currently prevailing low levels could affect the ability
      or
      willingness of prospective buyers to finance their purchases. Although we expect
      that we would be able to make adjustments in our operations to mitigate the
      effects of any increase in interest rates, there can be no assurances that
      these
      efforts would be successful.




10


This
      Property Management segment faces competition from real estate investment trusts
      (REIT’s), which are already among the largest commercial property owners in the
      United States. With over 300 public and private REIT’s in the United States,
      they have slowly been growing their holdings through acquisitions. Most REIT’s,
      however, do not specialize in industrial and office properties.




**MANUFACTURING**




Evans
      Columbus, LLC, (“Evans”) acquired in December 2004, manufactures 55-gallon steel
      drums at a production rate of approximately 3,000 drums per day. Evans, which
      was founded in 1955, generated revenues of approximately $9.3llion in 2005.
      Manufacturing is carried out in a fully equipped 70,000 square foot facility
      located in Columbus, Ohio. This facility is able to do various coated products
      as well as standard painted drums. Prior to its acquisition by Heartland, Evans
      Columbus was a family owned and operated business.




In
      order
      to utilize manufacturing facilities and technology more effectively, we pursue
      continuous improvements in manufacturing processes. We have some flexible
      assembly lines to deliver products when customers require them. Additionally,
      considerable effort is spent to reduce manufacturing costs through process
      improvement, product and platform design, application of advanced technology,
      enhanced environmental management systems, and better supply-chain
      management.




Our
      production levels and inventory management goals are based on estimates of
      demand for our products, taking into account production capacity, timing of
      shipments, and field inventory levels. We also periodically shut down production
      to allow for maintenance, rearrangement, and capital equipment installation
      at
      the manufacturing facilities.




Incorporated
      into our Quality Policy, Evans maintains a regular preventative maintenance
      and
      calibration schedule. Our dedicated maintenance crew is “on-the-job” at all
      times. During manufacturing shifts, we are testing to make sure drums are
      manufactured to meet customer specification and governmental regulations.
      Regular preventative maintenance protects the plant equipment and assures
      reliability and continuity of supply.




The
      Company is in dispute with the prior owners of Evans Columbus. The prior owners
      take the position that their agreement with the Company is null and void. The
      Company is in the process of attempting to find a resolution to the
      dispute.





**Competition
      and Other Factors**




The
      steel
      container industry is the third-largest steel user, next to the automobile
      industry and the appliance industry. Steel drum-makers, who manufacture
      55-gallon drums that hold products ranging from chocolate for ice cream bars
      to
      coatings for jelly beans, make up about 40 percent of the steel container
      industry. The steel drum industry mainly uses cold-rolled steel.




There
      are
      approximately 14 manufacturers of 55 gallon steel drums nationwide. The three
      major competitors of the company are North Coast Container (Cleveland, Ohio),
      Berenfield Containers (Mason, OH), and Grief Bros Corporation (Delaware, Ohio)
      which are all larger than Evans. The region where Evans is located is one of
      the
      more heavily concentrated areas for 55 gallon drum manufactures and
      users.




Attention
      to environmental compliance is practiced throughout the plant. Working in
      concert with the Ohio and Federal EPA, we continue to incorporate safe
      manufacturing processes. Rigorous testing throughout the plant ensures safety
      for our employees, neighbors and the environment.




Evans
      is
      subject to the risks associated with the steel industry, in particular to the
      cost of raw materials, energy and labor supply all of which are managed
      effectively. The company is reliant upon several distributors through out the
      Ohio Valley region. Evans sells it products to customers based upon superior
      quality and service and not specifically on price which leads to repeat business
      and less impact on economical affects (i.e. interest rates).








11







**GENERAL**




The
      Company’s mission is to become a leading diversified company with business
      interests in well established industries.




In
      addition to the risks identified above the Company also faces risks of its
      own.
      The Company is reliant upon identifying, contracting and financing each
      acquisition it identifies. Since the Company is in its early stages, it may
      not
      be able to obtain the necessary funding to continue its growth plan.
      Additionally, the potential synergies identified with each of the acquisitions
      may not materialize to the extend, if at all, as initially
      identified.




**Employees**




As
      of May
      17, 2006, we employed 100 employees. From time to time, we also retain
      consultants, independent contractors, and temporary and part-time
      workers.




We
      believe our relationship with our current employees is good. Our employees
      are
      not represented by a labor union. Our success is dependent, in part, upon our
      ability to attract and retain qualified management technical personnel and
      subcontractors. Competition for these personnel is intense, and we will be
      adversely affected if we are unable to attract key employees. We presently
      do
      not have a stock option plan for key employees and consultants.




**Customers**




Overall,
      our management believes that long-term we are not dependent on a single customer
      for any of the segments results. While the loss of any substantial customer
      could have a material short-term impact on a segment, we believe that our
      diverse distribution channels and customer base should reduce the long-term
      impact of any such loss.





**ITEM
                2.****DESCRIPTION
                OF PROPERTY**





The
      following properties are used in the operation of our business:




Our
      principal executive and administrative offices are located at 25 Mound Park
      Drive South, Springboro, Ohio 45066. Our phone number is (763) 557.2900. We
      lease approximately 39,000 square feet on a month to month lease for $8,500
      per
      month from a major shareholder of our company. The facilities include 34,000
      square feet which is used for manufacturing and 5,000 square feet for office
      space. The space is used by Mound as well.





St.
      Paul
      Properties, Inc., 385 Washington Street, St. Paul, Minnesota 55102. We are
      renting approximately 2,048 square feet of an 85,232 square feet building.
      We
      pay our proportionate share of utilities and real estate tax based upon our
      percentage of occupancy as the building is shared with a number of
      tenants.




This
      space is not sufficient for us as we add employees to the corporate staff.
      In
      light of this the corporation will evaluate its office needs and determine
      the
      best option as we continue to grow.




In
      Springboro, Ohio we lease approximately 39,000 square feet on a month to month
      lease for $8,500 per month from a major shareholder of our company. The
      facilities include 34,000 square feet which is used for manufacturing and 5,000
      square feet for office space. The space is used by Mound.




In
      Columbus, Ohio we lease approximately 70,000 square feet on a five (5) year
      term
      from January 1, 2002 through December 31, 2007 for $20,000 per month from Par
      Investments, a company related to the president of Evans. The facilities include
      approximately 67,000 square feet for manufacturing and 3,000 square feet for
      offices. The space is used by Evans.




12


In
      Ramsey, Minnesota we lease approximately 3,000 square feet on a month to month
      lease for $7,000 per month from Brad Fritch, the President of Monarch. The
      facilities include approximately 1,800 square feet of office space and 1,200
      square feet for storage. The space is used by Monarch.




In
      St.
      Louis Park, Minnesota we lease approximately 6,975 square feet on a 63 month
      lease beginning January 1, 2005. The facilities are used as offices for our
      Karkela employees. The lessor is Larry Karkela, the President of the Karkela
      subsidiary. The lease required an initial security deposit of $5,356. We pay
      our
      proportionate share of utilities and real estate tax based upon our percentage
      of occupancy which is 60.1%. The lease requires payments of:






**Months**
            
            **Monthly
                Payment**1-12
            
            $
            3,27213-24
            
            $
            3,40325-36
            
            $
            3,57337-48
            
            $
            3,75249-60
            
            $
            3,93861-63
            
            $
            4,136




**ITEM
                3.****LEGAL
                PROCEEDINGS**





In
      the
      normal course of our business, we and/or our subsidiaries are named as
      defendants in suits filed in various state and federal courts. We believe that
      none of the litigation matters in which we, or any of our subsidiaries, are
      involved would have a material adverse effect on our consolidated financial
      condition or operations.





The
      Company is in dispute with the prior owners of Evans Columbus. The prior owners
      take the position that their agreement with the Company is null and void. The
      Company is in the process of attempting to find a resolution to the
      dispute.





There
      is
      no past, pending or, to our knowledge, threatened litigation or administrative
      action which has or is expected by our management to have a material effect
      upon
      our business, financial condition or operations, including any litigation or
      action involving our officers, directors, or other key personnel.







**ITEM
                4.****SUBMISSION
                OF MATTERS TO A VOTE OF SECURITY
                HOLDERS**





None.


13




**PART
      II**




**ITEM
      5.**  **MARKET
      FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER
      PURCHASES OF EQUITY SECURITIES**





Our
      common stock has been quoted on the OTC Bulletin Board since August 2002. Our
      symbol is "HTLJ". For the periods indicated, the following table sets forth
      the
      high and low bid prices per share of common stock. These prices represent
      inter-dealer quotations without retail markup, markdown, or commission and
      may
      not necessarily represent actual transactions.




**HIGH**
            
            **LOW****FISCAL
                YEAR ENDED DECEMBER 31, 2006**First
                Quarter
            
            0.82
            
            0.33**FISCAL
                YEAR ENDED DECEMBER 31, 2005**First
                Quarter
            
            1.00
            
            0.30Second
                Quarter
            
            0.90
            
            0.90Third
                Quarter
            
            0.65
            
            0.65Fourth
                Quarter
            
            1.60
            
            1.60**FISCAL
                YEAR ENDED DECEMBER 31, 2004**First
                Quarter
            
            1.00
            
            0.70Second
                Quarter
            
            1.00
            
            0.70Third
                Quarter
            
            1.00
            
            0.70Fourth
                Quarter
            
            1.60
            
            1.60




As
      of May
      17, 2006, there were 25,128,858 shares of common stock outstanding.




As
      of May
      17, 2006, there were approximately 630 stockholders of record of our common
      stock. This does not reflect those shares held beneficially or those shares
      held
      in "street" name.




We
      have
      not paid cash dividends in the past, nor do we expect to pay cash dividends
      for
      the foreseeable future. We anticipate that earnings, if any, will be retained
      for the development of our business.




**Preferred
      Stock**




The
      Company has 5,000,000 of preferred stock authorized with a par value of $.001.
      None of these securities are issue or outstanding.




**Transfer
      Agent**




The
      Company’s transfer agent and registrar of the common stock is Securities
      Transfer Corporation, 2591 Dallas Parkway, Suite 102, Frisco, Texas
      75034




14


**Warrants**




The
      Company has no Warrants outstanding as of this date.




**Options**




The
      Company has no Stock Option Plan as of this date.




**Penny
      Stock Considerations**




Because
      our shares trade at less than $5.00 per share, they are “penny stocks” as that
      term is generally defined in the Securities Exchange Act of 1934 to mean equity
      securities with a price of less than $5.00. Our shares thus will be subject
      to
      rules that impose sales practice and disclosure requirements on broker-dealers
      who engage in certain transactions involving a penny stock.




Under
      the
      penny stock regulations, a broker-dealer selling a penny stock to anyone other
      than an established customer or accredited investor must make a special
      suitability determination regarding the purchaser and must receive the
      purchaser’s written consent to the transaction prior to the sale, unless the
      broker-dealer is otherwise exempt. Generally, an individual with a net worth
      in
      excess of $1,000,000 or annual income exceeding $100,000 individually or
      $300,000 together with his or her spouse is considered an accredited investor.
      In addition, under the penny stock regulations the broker-dealer is required
      to:




o
            Deliver,
                prior to any transaction involving a penny stock, a disclosure schedule
                prepared by the Securities and Exchange Commissions relating to the
                penny
                stock market, unless the broker-dealer or the transaction is otherwise
                exempt;o
            Disclose
                commissions payable to the broker-dealer and our registered
                representatives and current bid and offer quotations for the
                securities;o
            Send
                monthly statements disclosing recent price information pertaining
                to the
                penny stock held in a customer’s account, the account’s value and
                information regarding the limited market in penny stocks;
                ando
            Make
                a special written determination that the penny stock is a suitable
                investment for the purchaser and receive the purchaser’s written agreement
                to the transaction, prior to conducting any penny stock transaction
                in the
                customer’s account.




Because
      of these regulations, broker-dealers may encounter difficulties in their attempt
      to sell shares of our common stock, which may affect the ability of selling
      shareholders or other holders to sell their shares in the secondary market
      and
      have the effect of reducing the level of trading activity in the secondary
      market. These additional sales practice and disclosure requirements could impede
      the sale of our securities, if our securities become publicly traded. In
      addition, the liquidity for our securities may be decreased, with a
      corresponding decrease in the price of our securities. Our shares in all
      probability will be subject to such penny stock rules and our shareholders
      will,
      in all likelihood, find it difficult to sell their securities.





**Dividends**




We
      do not
      anticipate paying dividends in the foreseeable future. We plan to retain any
      future earnings for use in our business. Any decisions as to future payments
      of
      dividends will depend on our earnings and financial position and such other
      facts as the Board of Directors deems relevant.





**Recent
      Sales of Unregistered Securities**




The
      following is information for all securities that the Company sold during its
      current fiscal year ended December 31, 2005.




On
      January 10, 2005, the Company granted 1,500,000 shares to Trent Sommerville,
      its
      Chief Executive Officer.




15


On
      April
      12, 2005 the company issued 300,000 shares to Jeffrey Brandeis, its former
      president, as a complete settlement of an employment contract
      dispute.




On
      April
      29, 2005 the company issued 7,500 shares to Gerald Aaron for consulting
      fees.




On
      April
      29, 2005 the company issued 200,000 shares to Ross Haugen for consulting
      fees.




On
      April
      29, 2005 the company sold 150,000 shares to an investor in a private
      placement.




On
      April
      29, 2005 the company sold 25,000 shares to an investor in a private
      placement.




On
      April
      29, 2005 the company issued 100,000 shares to International Monetary Resources
      for consulting fees.




On
      May
      25, 2005 the company issued 15,000 shares to Smallcapinvoice.com for consulting
      fees.




On
      May
      27, 2005 the company issued 216,670 shares to John E. Gracik for consulting
      fees.




On
      May
      27, 2005 the company issued 9,600 shares to Steven Gracik for consulting
      fees.




On
      May
      27, 2005 the company issued 15,000 shares to Nicholas T. Pappas for consulting
      fees.




On
      May
      27, 2005 the company issued 20,000 shares to David Yeomans for consulting
      fees.




On
      May
      31, 2005 the company issued 60,000 shares to investors for conversion of
      promissory notes.




On
      June
      6, 2005 the company issued 60,000 shares to First Equity Group, Inc. for
      consulting fees.




On
      June
      14, 2005 the company sold 25,000 shares to an investor in a private
      placement.




On
      June
      30, 2005 the company issued 27,500 shares to John E. Gracik for consulting
      fees.





On
      July
      14, 2005 the company issued 75,000 shares to Graham Paxton in settlement of
      a
      judgement.




On
      July
      18, 2005 the company issued 100,000 shares to Steve Persinger as a deposit
      on
      the acquisition of Persinger Equipment, Inc.




On
      August
      19, 2005 the company issued 22,000 shares to John Gracik for consulting
      fees.




On
      August
      31, 2005 the company issued 154,564 shares to Barbara Young, Young Technology
      Fund I and Young Technology Fund II in settlement of a dispute.




On
      September 23, 2005 the company issued 180,000 shares to Ross Haugen for
      consulting fees.




On
      September 27, 2005 the company issued 10,000 shares to Dolores Dear for
      consulting fees.




During
      the Quarter ending March 31, 2005, the Company entered into several convertible
      note payable agreements. The notes bear interest at the rate of 10% per year
      and
      are due and payable one year from the date executed at which time the notes,
      at
      the option of the note holder, can be converted into 573,200 shares of common
      stock of which 561,300 will be converted at $1.00 per share and 11,900 will
      be
      converted at $0.50 per share.




During
      the months of April and May, 2005, the company entered into several convertible
      note payable agreements for a total value of $44,726. The notes bear interest
      at
      10% per year and are due one year from the date executed, at which time the
      notes, at the option of the note holder, can be converted into 44,726 restricted
      newly issued shares of common stock converted at $1.00 per share.




16


We
      relied
      upon Section 4(2) of the Securities Act of 1933, as amended for the above
      issuances. We believed that Section 4(2) was available because:




o
            None
                of these issuances involved underwriters, underwriting discounts
                or
                commissions;o
            We
                placed restrictive legends on all certificates issued;o
            No
                sales were made by general solicitation or advertising;





o
            Sales
                were made only to accredited investors or investors who were sophisticated
                enough to evaluate the risks of the
                investment.




In
      connection with the above transactions, although some of the investors may
      have
      also been accredited, we provided the following to all investors:




o
            Access
                to all our books and records.o
            Access
                to all material contracts and documents relating to our
                operations.





o
            The
                opportunity to obtain any additional information, to the extent we
                possessed such information, necessary to verify the accuracy of the
                information to which the investors were given
                access.






**ITEM
      6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
      OPERATIONS**





Overview





The
      following discussion should be read in conjunction with the financial statements
      for the period ended December 31, 2005 included with this Form
      10-KSB.





The
      following discussion and analysis provides certain information, which the
      Company’s management believes is relevant to an assessment and understanding of
      the Company’s results of operations and financial condition for the year ended
      December 31, 2005. This discussion and analysis should be read in conjunction
      with the Company’s financial statements and related footnotes.





The
      statements contained in this section that are not historical facts are
      forward-looking statements (as such term is defined in the Private Securities
      Litigation Reform Act of 1995) that involve risks and uncertainties. Such
      forward-looking statements may be identified by, among other things, the use
      of
      forward-looking terminology such as “believes,” “expects,” “may,” “will,”
should” or “anticipates” or the negative thereof or other variations thereon or
      comparable terminology, or by discussions of strategy that involve risks and
      uncertainties. From time to time, we or our representatives have made or may
      make forward-looking statements, orally or in writing. Such forward-looking
      statements may be included in our various filings with the SEC, or press
      releases or oral statements made by or with the approval of our authorized
      executive officers.





These
      forward-looking statements, such as statements regarding anticipated future
      revenues, capital expenditures and other statements regarding matters that
      are
      not historical facts, involve predictions. Our actual results, performance
      or
      achievements could differ materially from the results expressed in, or implied
      by, these forward-looking statements. We do not undertake any obligation to
      publicly release any revisions to these forward-looking statements or to reflect
      the occurrence of unanticipated events. Many important factors affect our
      ability to achieve its objectives, including, among other things, technological
      and other developments in the Internet field, intense and evolving competition,
      the lack of an “established trading market” for our shares, and our ability to
      obtain additional financing, as well as other risks detailed from time to time
      in our public disclosure filings with the SEC.





The
      Company was incorporated in the State of Maryland on April 6, 1999 as Origin
      Investment Group, Inc. (“Origin”). On December 27, 2001, the Company went
      through a reverse merger with International Wireless, Inc. Thereafter on January
      2, 2002, the Company changed its name from Origin to International Wireless,
      Inc. On November 15, 2003, the Company went through a reverse merger with PMI
      Wireless, Inc. Thereafter in May 2004, the Company changed its name from
      International Wireless, Inc. to our current name, Heartland Inc.





17


The
      Company was originally formed as a non-diversified closed-end management
      investment company, as those terms are used in the Investment Company Act of
      1940 (“1940 Act”). The Company at that time elected to be regulated as a
      business development company under the 1940 Act. In December 7, 2001 the
      Company’s shareholders voted on withdrawing the Company from being regulated as
      a business development company and thereby no longer be subject to the 1940
      Act.





The
      Company’s original investment strategy when it was regulated as a business
      development company under the 1940 Act. was to invest in a diverse portfolio
      of
      private companies that could be used to build an Internet infrastructure by
      offering hardware, software and/or services which enhance the use of the
      Internet. Prior to it’s reverse merger with International Wireless, the Company
      identified two eligible portfolio companies within which they entered into
      agreements to acquire interests within such companies and to further invest
      capital in these companies to further develop their business. However, on each
      occasion and prior to each closing, the Company was either unable to raise
      sufficient capital to consummate the transaction or discovered information
      which
      modified its understanding of the eligible portfolio company’s financial status
      to such an extent where it was unadvisable for it to continue and consummate
      the
      transaction.





On
      December 7, 2001, the Company held a special meeting of its shareholders whereby
      the shareholders voted on withdrawing the Company from being regulated as a
      business development company and thereby no longer be subject to the Investment
      Company Act of 1940 and to effect a one-for-nine reverse split of its total
      issued and outstanding common stock. On December 14, 2001 the Company filed
      with
      the Securities and Exchange Commission formally notifying its withdrawal from
      being regulated as a business development company.





On
      December 27, 2001, the Company went through a reverse merger whereby it acquired
      all the outstanding shares of International Wireless. Under the said reverse
      merger, the former Shareholders of International Wireless ended up owning an
      88.61% interest in the Company. Thereafter on January 2, 2002, the Company
      changed its name from Origin to International Wireless, Inc.





From
      December 27, 2001 through June 2003, the Company attempted to develop its bar
      code technology and bring it to market. To that extent, the Company moved its
      operations to Woburn, Massachusetts, hired numerous computer programmers,
      developers and sales people in addition to support staff. Due to the Company’s
      inability to raise sufficient capital, the Company was unable to pay current
      operating expenses and by June, 2003 shut down its operations
      entirely.





On
      August
      29, 2003, a change in control of the Company occurred in conjunction with naming
      Attorney Jerry Gruenbaum of First Union Venture Group, LLC as attorney of record
      for the purpose of overseeing the proper disposition of the Company and its
      remaining assets and liabilities by any means appropriate, including settling
      any and all liabilities to the U.S. Internal Revenue Service and the
      Commonwealth of Massachusetts’ Attorney General’s office for unpaid
      wages.





In
      conjunction with naming Attorney Jerry Gruenbaum of First Union Venture Group,
      LLC as attorney of record for the purpose of overseeing the proper disposition
      of the Company and its remaining assets and liabilities, the Company issued
      First Union Venture Group, LLC, a Nevada Limited Liability Company, Thirty
      Million (30,000,000) newly issued common shares as consideration for their
      services. In addition, the Company canceled any and all outstanding options,
      warrants, and/or debentures not exercised to date. The Company further nullified
      any and all salaries, bonuses, and benefits including severance pay and accrued
      salaries to Stanley A. Young and Michael Dewar.





On
      November 12, 2003, the Company approved the spin-off of the two subsidiaries
      of
      the Company and any and all remaining assets of the Company, including any
      intellectual property, to enable the Company to pursue a suitable merger
      candidate. In addition, the Company approved a 30 to 1 reverse split of all
      existing outstanding common shares of the Company. Following the 30 to 1 reverse
      split, the Company had 1,857,137 shares of common stock
      outstanding.





On
      November 15, 2003, a change in control of the Company occurred when the Company
      went through a reverse merger with PMI Wireless, Inc., a Delaware corporation
      with corporate headquarters located in Cordova, Tennessee. The acquisition,
      took
      place on December 1, 2003 for the aggregate consideration of fifty thousand
      dollars ($50,000) which was paid to the U.S. Internal Revenue Service for the
      Company’s prior obligations, plus assumption of the Company’s existing debts,
      for 9,938,466 newly issued common shares of the Company. Under the said reverse
      merger, the former Shareholders of PMI Wireless ended up owning an 84.26%
      interest in the Company.





18


On
      December 10, 2003, the Company entered into an Acquisition Agreement to acquire
      one hundred percent (100%) of Mound Technologies, Inc. (“Mound”), a Nevada
      corporation with its corporate headquarters located in Springboro, Ohio. The
      acquisition was a stock for stock exchange in which the Company acquired all
      of
      the issued and outstanding common stock of Mound in exchange for 1,256,000
      newly
      issued shares of its common stock. As a result of this transaction, Mound became
      a wholly owned subsidiary of the Company.





In
      May
      2004, the Company changed its name from International Wireless, Inc. to our
      current name, Heartland, Inc.




On
      December 27, 2004, the Company entered into an Acquisition Agreement to acquire
      100% of Monarch Homes, Inc. (“Monarch”), a Minnesota corporation with its
      corporate headquarters located in Ramsey, MN for $5,000,000. The acquisition
      price was made up of:





·
            $100,000
                at closing,


·
            a
                promissory note of $1,900,000 payable on or before February 15, 2005
                which, if not paid by that date, interest shall be due from then
                to actual
                payment at 8%, simple interest, compounded annually, and


·
            six
                hundred sixty-seven thousand (667,000) restricted newly issued shares
                of
                the Company’s common stock provided at closing.





In
      the
      event the common stock of the Company not is trading at a minimum of $5.00
      as of
      December 27, 2005, the Company was required to compensate the original Monarch
      shareholders for the difference in additional stock. As a result of the
      aforementioned, the Company has agreed to isssue the former Monarch shareholders
      333,000 shares of common stock. Monarch is a wholly owned subsidiary of the
      Company.




On
      December 30, 2004, the Company entered into an Acquisition Agreement to acquire
      100% of Evans Columbus, LLS (“Evans”), an Ohio corporation with its corporate
      headquarters located in Blacklick, OH for $3,005,000. The acquisition price
      was
      paid as follows:





·
            $5,000
                at closing, and


·
            600,000
                restricted newly issued shares of the Company’s common stock provided at
                closing.





In
      the
      event the common stock of the Company is not trading at a minimum of $5.00
      as of
      December 30, 2005, the Company was required to compensate the original Evans
      shareholders for the difference in additional stock. As a result of the
      aforementioned, the Company is in dispute with Evans who claims as of January
      2006 that his acquisition contract is null and void. Evans is a wholly owned
      subsidiary of the Company.




On
      December 31, 2004, the Company entered into an Acquisition Agreement to acquire
      100% of Karkela Construction, Inc., a Minnesota corporation with its corporate
      headquarters located in St. Louis Park, MN for $3,000,000. The acquisition
      price
      consisted of the following:





·
            $100,000
                at closing,


·
            a
                short term promissory note payable of $50,000 on or before January
                31,
                2005,


·
            a
                promissory note of $1,305,000 payable on or before March 31, 2005
                which,
                if not paid by that date, interest is due from December 31, 2004
                to actual
                payment at 8%, simple interest, compounded annually and


·
            500,000
                restricted newly issued shares of the Company’s common stock provided at
                closing.





19


In
      the
      event the common stock of the Company is not trading at a minimum of $4.00
      as of
      December 31, 2005, the Company was required to compensate the original Karkela
      shareholders for the difference in additional stock. As a result of the
      aforementioned, the Company issued the former Karkela shareholders 262,500
      shares of common stock on March 15, 2006. Karkela is a wholly owned subsidiary
      of the Company.





On
      July
      29, 2005, the Company entered into a binding Stock Purchase Agreement with
      Steven Persinger, an individual, to acquire all the issued and outstanding
      shares of common stock of Persinger Equipment, Inc., a Minnesota corporation
      (“Persinger”) for $4,735,000. The acquisition price consists of the following:





·
            $2,000,000
                in cash on or before February 1, 2006, and


·
            $2,735,000,
                payable in cash or 911,667 non-restricted shares of common stock
                of the
                Company at the Company’s option payable at closing.





In
      the
      event the common stock of the Company is not trading at a minimum of $3.00
      as of
      July 29, 2006, the Company is required to compensate Mr. Persinger for the
      difference in additional stock. In connection with the Stock Purchase Agreement,
      the Company and Mr. Persinger will enter into an employment agreement for a
      period of 5 years with an annual base salary of $120,000 per year, which
      includes various incentive based provisions. Also in connection with the Stock
      Purchase Agreement, Persinger will continue leasing from Mr. Persinger the
      real
      estate that Persinger operates in its business for as long as Mr. Persinger
      is
      employed by Persinger. Persinger has the right and option to purchase this
      real
      estate during Mr. Persinger’s employment for $600,000.





On
      September 12, 2005, the Company entered into a binding Agreement for Purchase
      and Sale of Shares with Calvin E. Bergman, Lynn E. Bergman, Jerry L. Bergman,
      Barbara A. Vance and Marvin Bergman, individually, to acquire all the issued
      and
      outstanding shares of common stock of Ney Oil Company, an Ohio corporation
      (“Ney
      Oil Company”) for $5,000,000. The acquisition price consisted of:





·
            $3,000,000
                at closing, and


·
            1,333,300
                shares of common stock of the Company valued three business days
                prior to
                the closing to not be less than $2,000,000.





In
      the
      event the value is less than $2,000,000, the number shall increase accordingly.





On
      September 12, 2005, the Company entered into a Letter of Intent with Terry
      Robbins, President of Ohio Valley Lumber, to acquire all the issued and
      outstanding shares of common stock of NKR, Inc, d.b.a. Ohio Valley Lumber,
      a
      Delaware corporation (“NKR”) for $8,000,000.00. The acquisition price was made
      up of:





·
            $4,000,000
                in cash,


·
            2,000,000
                shares of common stock of the Company and


·
            $2,000,000
                in cash for the reduction of NKR’s debt.





The
      Company is still negotiating the terms of the definitive documentation.





On
      September 21, 2005, the Company entered into a binding Acquisition Agreement
      with Terry L. Lee and Gary D. Lee, individually, to acquire all the issued
      and
      outstanding shares of common stock of Lee Oil Company, Inc., a Virginia
      corporation, Lee Enterprises, Inc., a Kentucky corporation and Lee’s Food Marts
      LLC, a Tennessee Limited Liability Company, (collectively hereinafter "Lee
      Oil
      Company") for $6,000,000.00. The acquisition price shall consist of:





·
            $5,000,000.00
                at closing and


·
            $1,000,000.00,
                payable in common stock of the Company valued at the date of closing.





On
      September 26, 2005, the Company entered into a binding Acquisition Agreement
      with Robert Daniel, Karol K. Hart-Bendure, M. Lucille Daniel, and Joe M. Daniel,
      individually, to acquire all the issued and outstanding shares of common stock
      of Schultz Oil Company, Inc., an Ohio Corporation (“Schultz Oil Company”) for
      $3,500,000 consisting of $1,500,000 in cash at closing and 1,000,000 of common
      stock. In the event the common stock of the Company does not have a value of
      at
      least $2.00 as of September 26, 2007, the Company is required to compensate
      the
      shareholders for the difference with the issuance of additional
      shares.





20





**RESULTS
      OF OPERATIONS FOR THE FISCAL YEARS ENDED DECEMBER 31, 2005 AND
      2004**





**OVERVIEW**





Heartland,
      Inc. is an operating conglomerate with operations in steel fabrication,
      manufacturing, construction and property management. Total consolidated revenues
      for the year ended December 31, 2004 was $50,007,763 versus $4,428,836 for
      the
      year ended December 31, 2003. The Company incurred operating expenses of
      $49,280,468 for the year ended December 31, 2004 and $5,401,779 for the year
      ended December 31, 2003.





In
      fiscal
      year ended December 31, 2004 the company incurred a net income from continuing
      operations of $753,279 or a gain of $0.04 per share compared to a net loss
      of $
      (1,510,450) or a loss of $(0.12) per share in fiscal year ended December 31,
      2003. The primary factor contributing to the net earnings increase were from
      higher sales from the acquisitions of Monarch Homes, Karkela and Evans and
      improved leverage of selling, general and administrative expenses.





**2005**
            
            **2004****Restated**Net
                sales
            
            $
            40,674,714
            
            $
            7,389,064Cost
                and expensesCost
                of good sold
            
            
            29,018,150
            
            
            6,498,641Selling,
                general and administrative expense
            
            
            13,271,877
            
            
            1,398,493Stock
                Based Compensation
            
            
            1,652,985
            
            
            63,767Depreciation
                and amortization
            
            
            615,846
            
            
            102,756Total
                Cash and Expenses
            
            
            44,558,857
            
            
            8,063,677Operating
                Income
            
            
            (3,884,143
            )
            
            (674,613
            )Net
                Other Income
            
            
            (748,990
            )
            
            161,105Net
                Income(loss)from continuing operations
            
            
            (4,663,133
            )
            
            (513,508
            )Total
                Discontinued Operations - LossIncome
                before taxes
            
            
            (4,663,133
            )
            
            (513,508
            )Income
                Taxes
            
            
            22,000
            
            
            ---Net
                Loss
            
            
            
            
            $
            $(513,508
            )








**SALES**





Sales
      increased in fiscal year ended December 31, 2005 by 550% to $40,674,7147 from
      $7,389,064 in fiscal year ended December 31, 2004 due to the acquisitions in
      late December 2004 of Evans Columbus, Karkela Construction and Monarch
      Homes.





21


**INCOME
      BEFORE INCOME TAXES AND EXTRAORDINARY ITEM**





Pre-tax
      loss was $4,633,133 in fiscal year ended December 31, 2005 and $513,508 in
      fiscal year ended December 31, 2004. Reflecting the acquisitions of Evans
      Columbus, Karkela Construction and Monarch Homes which occurred in the final
      month of fiscal year ended December 31, 2004.





**INTEREST
      EXPENSE**





Interest
      expense was $858,707 during the fiscal year ended December 31, 2005 as compared
      to $45,583 in fiscal year ended December 31, 2004.





**LIQUIDITY
      AND CAPITAL RESOURCES**





As
      presented in the Consolidated Statement of Cash Flows, net cash used by
      operating activities was $ xxxxx in
      fiscal 2005. The significant changes in working capital were an $xxxxx increase
      in accounts receivable, a $ xxxxx increase
      in inventory. Working capital requirements are not anticipated to increase
      substantially in fiscal 2006.





During
      fiscal 2004, the Company used cash of $ xxxx to
      acquire companies. The Company received net cash of $ xxxx from the
      issue of certain promissory convertible notes.





The
      level
      of capital expenditures is expected to increase moderately in fiscal 2006,
      and
      the source of funds for such expenditures is expected to be cash from
      operations.





At
      December 31, 2005 the Company’s total debt was $23,428,164 as compared to
      $15,565,1737 at December 31, 2004. The Company believes that its funding sources
      are adequate for its anticipated requirements.





Shareholders’
      equity was $5,860,999 at December 31, 2005 compared to $7,061,271 at December
      31, 2004. The decrease is due to increase in net loss and the positive
      shareholders equity from the acquisitions.





Our
      businesses are seasonally working capital intensive and require funding for
      purchases of raw materials used in production, replacement parts inventory,
      capital expenditures, expansion and upgrading of existing facilities, as well
      as
      for financing receivables from customers. We believe that cash generated from
      operations, together with our bank credit lines, and cash on hand, will provide
      us with a majority of our liquidity to meet our operating requirements. We
      believe that the combination of funds available through future anticipated
      financing arrangements, as discussed below, coupled with forecasted cash flows,
      will be sufficient to provide the necessary capital resources for our
      anticipated working capital, capital expenditures, and debt repayments for
      at
      least the next twelve months.





We
      are
      seeking to raise up to $5 million of additional capital from private investors
      and institutional money managers in the next few months, but there can be no
      assurance that we will be successful in doing so. If we are not successful
      in
      raising any of this additional capital, our current cash resources may not
      sufficient to fund our current operations.





We
      may
      experience problems, delays, expenses, and difficulties sometimes encountered
      by
      an enterprise in our stage of development, many of which are beyond our control.
      For potential acquisitions, these include, but are not limited to, unanticipated
      problems relating to the identifying partner(s), obtaining financing,
      culminating the identified partner due to a number of possibilities (prices,
      dates, terms, etc). Due to limited experience in operating the combined entities
      for the Company, we may experience production and marketing problems, incur
      additional costs and expenses that may exceed current estimates, and
      competition.





Our
      businesses are seasonally working capital intensive and require funding for
      purchases of raw materials used in production, replacement parts inventory,
      capital expenditures, expansion and upgrading of existing facilities, as well
      as
      for financing receivables from customers. During the year ended December 31,
      2004, the Company has not engaged in:





o
            Material
                off-balance sheet activities, including the use of structured finance
                or
                special purpose entities;




22


o
            Trading
                activities in non-exchange traded contracts;
                or


o
            Transactions
                with persons or entities that benefit from their non-independent
                relationship with the Company.





**Inflation**





We
      are
      subject to the effects of inflation and changing prices. As previously
      mentioned, we experienced rising prices for steel and other commodities during
      fiscal 2005 that had a negative impact on our gross margins and net earnings.
      In
      fiscal 2006, we expect average prices of steel and other commodities to be
      higher than the average prices paid in fiscal 2005. We will attempt to mitigate
      the impact of these anticipated increases in steel and other commodity prices
      and other inflationary pressures by actively pursuing internal cost reduction
      efforts and introducing price increases.





**Critical
      Accounting Policies and Estimates**





In
      preparing our consolidated financial statements in conformity with accounting
      principles generally accepted in the United States of America, we must make
      decisions that impact the reported amounts of assets, liabilities, revenues
      and
      expenses, and related disclosures. Such decisions include the selection of
      the
      appropriate accounting principles to be applied and the assumptions on which
      to
      base accounting estimates. In reaching such decisions, we apply judgments based
      on our understanding and analysis of the relevant circumstances, historical
      experience, and actuarial valuations. Actual amounts could differ from those
      estimated at the time the consolidated financial statements are
      prepared.





Our
      significant accounting policies are described in Note A to the consolidated
      financial statements. Some of those significant accounting policies require
      us
      to make difficult subjective or complex judgments or estimates. An accounting
      estimate is considered to be critical if it meets both of the following
      criteria: (i) the estimate requires assumptions about matters that are highly
      uncertain at the time the accounting estimate is made, and (ii) different
      estimates that reasonably could have been used, or changes in the estimate
      that
      are reasonably likely to occur from period to period, would have a material
      impact on the presentation of our financial condition, changes in financial
      condition or results of operations.





Accounts
      Receivable Valuation. We value accounts receivable, net of an allowance for
      doubtful accounts. Each quarter, we estimate our ability to collect outstanding
      receivables that provides a basis for an allowance estimate for doubtful
      accounts. In doing so, we evaluate the age of our receivables, past collection
      history, current financial conditions of key customers, and economic conditions.
      Based on this evaluation, we establish a reserve for specific accounts
      receivable that we believe are uncollectible, as well as an estimate of
      uncollectible receivables not specifically known. A deterioration in the
      financial condition of any key customer or a significant slow down in the
      economy could have a material negative impact on our ability to collect a
      portion or all of the accounts and notes receivable. We believe that an analysis
      of historical trends and our current knowledge of potential collection





problems
      provide us with sufficient information to establish a reasonable estimate for
      an
      allowance for doubtful accounts. However, since we cannot predict with certainty
      future changes in the financial stability of our customers, our actual future
      losses from uncollectible accounts may differ from our estimates. In the event
      we determined that a smaller or larger uncollectible accounts reserve is
      appropriate we would record a credit or charge to selling, general, and
      administrative expense in the period that we made such a
      determination.











**ITEM
                7.****FINANCIAL
                STATEMENTS (RESTATED)**




R eference
      is made to the Consolidated Financial Statements of the Company, beginning
      with
      the index thereto on page F-1











HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 AUDITED
        FINANCIAL STATEMENTS
 
 FOR
        THE
        YEAR ENDED DECEMBER 31, 2005
 
  
  
 CONTENTS
 
 Report
                  of Independent Registered Public Accounting Firm
              Page
              F
                  1Consolidated
                  Balance Sheets
              
              F
                  2Consolidated
                  Statements of Operations
              
              F
                  4Consolidated
                  Statements of Cash Flows
              
              F
                  5Consolidated
                  Statements of Stockholders’ Equity (Deficit)
              
              F
                  7Notes
                  to Consolidated Financial Statements
              
              F
                  9
 
 
  
   MEYLER
        & COMPANY, LLC
 CERTIFIED
        PUBLIC ACCOUNTANTS
 ONE
        ARIN
        PARK
 1715
        HIGHWAY 35
 MIDDLETOWN,
        NJ 07748
 
 
 
 Report
        of
        Independent Registered Public Accounting Firm
 
 
 To
        the
        Board of Directors
 Heartland,
        Inc.
 Plymouth,
        MN
 
 We
        have
        audited the accompanying consolidated balance sheets of Heartland, Inc. and
        subsidiaries as of December 31, 2005 and 2004 (restated) and the related
        consolidated statements of operations, stockholders’ equity (deficit), and cash
        flows (restated 2004) for each of the two years in the period ended December
        31,
        2005. These consolidated financial statements are the responsibility of the
        Company’s management. Our responsibility is to express an opinion on these
        financial statements based on our audits.
 
 We
        conducted our audits in accordance with the standards of the Public Company
        Accounting Oversight Board (United States). Those standards require that
        we plan
        and perform the audit to obtain reasonable assurance about whether the financial
        statements are free of material misstatement. The Company is not required
        to
        have, nor were we engaged to perform, an audit of its internal control over
        financial reporting. Our audit included consideration of internal control
        over
        financial reporting as a basis for designing audit procedures that are
        appropriate in the circumstances, but not for the purpose of expressing an
        opinion on the effectiveness of the Company’s internal control over financial
        reporting. Accordingly, we express no such opinion. An audit also includes
        examining, on a test basis, evidence supporting the amounts and disclosures
        in
        the financial statements, assessing the accounting principles used and
        significant estimates made by management, as well as evaluating the overall
        financial statement presentation. We believe that our audits provide a
        reasonable basis for our opinion.
 
 In
        our
        opinion, the consolidated financial statements referred to above present
        fairly,
        in all material respects, the financial position of the Company as of December
        31, 2005 and 2004 (restated), and the results of its operations and its cash
        flows (restated 2004) for each of the two years in the period ended December
        31,
        2005, in conformity with U.S. generally accepted accounting
        principles.
 
 The
        accompanying consolidated financial statements have been prepared assuming
        that
        the Company will continue as a going concern. As discussed in Note A to the
        consolidated financial statements, the Company has negative working capital
        of
        $4,568,118, an accumulated deficit of $10,728,899, and there are existing
        uncertain conditions which the Company faces relative to its obtaining capital
        in the equity markets. These conditions raise substantial doubt about its
        ability to continue as a going concern. Management’s plans regarding those
        matters also are described in Note A. The financial statements do not include
        any adjustments that might result from the outcome of this
        uncertainty.
 
 
 
 
 /s/
        Meyler & Company, LLC
 
 
 
 
 
 Middletown,
        NJ
 May
        19,
        2006
 F-1
 HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 CONSOLIDATED
        BALANCE SHEETS
 
 
 December
                  31,2005
              
              2004(Restated)CURRENT
                  ASSETSCash
              
              $
              685,387
              
              $
              603,451Accounts
                  receivable net of allowance for doubtfulaccounts
                  of $219,663 and $684,829, respectively
              
              
              4,070,242
              
              
              3,467,970Costs
                  in excess of billings on uncompleted contracts
              
              
              332,396
              
              
              187,621Inventory
              
              
              10,291,050
              
              
              4,932,629Prepaid
                  expenses and other
              
              
              143,619
              
              
              120,583Total
                  Current Assets
              
              
              15,522,694
              
              
              9,312,254PROPERTY,
                  PLANT AND EQUIPMENT, net of accumulated depreciation of $ ,073,661
                  and
                  $816,069, respectively
              
              
              3,374,949
              
              
              5,403,107OTHER
                  ASSETSAdvances
                  to related party
              
              
              61,688
              
              
              202,965Goodwill
              
              
              1,291,390
              
              
              7,217,268Other
                  intangible assets
              
              
              447,125
              
              
              520,000Investments
              
              
              9,000Acquisition
                  deposits
              
              
              59,867Security
                  deposits
              
              
              240,920
              
              
              13,787Other
                  assets
              
              
              
              
              
              63,2412,109,990
              
              
              8,017,261Total
                  Assets
              
              $
              21,007,633
              
              $
              22,732,622
 
 
 
 See
        accompanying notes to financial statements.
  F-2
  
 HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 CONSOLIDATED
        BALANCE SHEETS (CONTINUED)
 
 
 LIABILITIES
        AND STOCKHOLDERS’ EQUITY (DEFICIT)
 
 December
                  31,2005
              
              2004(Restated)CURRENT
                  LIABILITIESBank
                  lines of credit
              
              $
              1,351,423
              
              $
              810,989Notes
                  payable - land purchases
              
              
              5,740,160
              
              
              1,965,698Convertible
                  promissory notes payable
              
              
              2,250,500
              
              
              1,026,550Current
                  portion of notes payable
              
              
              660,841
              
              
              120,687Current
                  portion of capitalized lease obligations
              
              
              121,934
              
              
              115,423Accounts
                  payable
              
              
              4,762,224
              
              
              2,985,455Acquisition
                  notes payable to related parties
              
              
              3,250,000
              
              
              3,300,000Obligations
                  to related parties
              
              
              
              
              
              670,907Accrued
                  payroll taxes
              
              
              516,969
              
              
              693,630Accrued
                  expenses
              
              
              738,117
              
              
              591,134Billings
                  in excess of costs on uncompleted contracts
              
              
              521,952
              
              
              153,379Customer
                  deposits
              
              
              12,770
              
              
              21,068Deferred
                  income taxes
              
              
              163,922
              
              
              408,003Total
                  Current Liabilities
              
              
              20,090,812
              
              
              12,862,923LONG-TERM
                  OBLIGATIONSNotes
                  payable, less current portion
              
              
              2,836,835
              
              
              2,137,928Capitalized
                  lease obligations, less current portion
              
              
              148,072
              
              
              269,100Notes
                  payable to individual
              
              
              
              
              
              150,000Non-controlling
                  interest of Variable Interest Entities
              
              
              352,445
              
              
              251,400Total
                  Long Term Liabilities
              
              
              3,337,352
              
              
              2,808,428STOCKHOLDERS’
                  EQUITY (DEFICIT)Preferred
                  stock $0.001 par value 5,000,000 shares authorized, none issued
                  and
                  outstandingCommon
                  stock, $0.001 par value 100,000,000 shares authorized; issued and
                  outstanding 23,746,024 and 18,244,801 shares at December 31, 2005
                  and
                  2004, respectively
              
              
              23,746
              
              
              18,244Additional
                  paid-in capital
              
              
              16,012,903
              
              
              13,161,421Accumulated
                  deficit
              
              
              (18,457,179
              )
              
              (6,118,394
              )Total
                  Stockholders’ Equity (Deficit)
              
              
              (2,420,530
              )
              
              7,061,271Total
                  Liabilities and Stockholders’ Equity (Deficit)
              
              $
              21,007,634
              
              $
              22,732,622
  
 
 See
        accompanying notes to financial statements.  F-3
 
 HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 CONSOLIDATED
        STATEMENTS OF OPERATIONS
 
 
 For
                  the Year Ended December 31,2005
              
              2004(Restated)REVENUE
                  - SALES
              
              $
              40,674,714
              
              $
              7,389,064COSTS
                  AND EXPENSESCost
                  of goods sold
              
              
              29,018,150
              
              
              6,498,641Selling,
                  general and administrative expenses
              
              
              13,249,248
              
              
              1,398,493Stock
                  based compensation
              
              
              1,652,985
              
              
              63,787Adjustment
                  of value of securities issued in connection with 2004
                  acquisitions
              
              
              
              
              
              7,719,000Impairment
                  of goodwill
              
              
              387,000Depreciation
                  and amortization
              
              
              238,126
              
              
              102,756Total
                  Costs and Expenses
              
              
              52,264,509
              
              
              8,063,677NET
                  OPERATING LOSS
              
              
              (11,589,795
              )
              
              (674,613
              )OTHER
                  INCOME (EXPENSE)Rental
                  income
              
              
              101,204
              
              
              197,806Other
                  income
              
              
              15,207
              
              
              11,371Loss
                  on disposal of equipment
              
              
              (6,634
              )
              
              (
                  2,489
              )Interest
                  expense
              
              
              (858,707
              )
              
              (45,583
              )Total
                  Other Income (Expense)
              
              
              (748,990
              )
              
              161,105NET
                  LOSS
              
              $
              (12,338,785
              )
              $
              (513,508
              )NET
                  LOSS PER COMMON SHAREBasic
              
              $
              (0.22
              )
              $
              (.04
              )Fully
                  diluted
              
              $
              (0.22
              )
              $
              (.03
              )WEIGHTED
                  AVERAGE COMMON SHARES OUTSTANDINGBasic
              
              
              21,158,951
              
              
              13,744,692Fully
                  diluted
              
              
              21,306,293
              
              
              15,101,692
 
  
 See
        accompanying notes to financial statements.
 F-4
  
 HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 CONSOLIDATED
        STATEMENT OF CASH FLOWS
 
 For
                  the Year Ended December 31,2005
              
              2004(Restated)CASH
                  FLOWS FROM OPERATING ACTIVITIESNet
                  loss
              
              $
              (12,338,785
              )
              $
              (513,508
              )Adjustments
                  to reconcile net loss to cash flows used in operating
                  activities:Stock
                  based compensation
              
              
              1,652,985
              
              
              63,787Impairment
                  and reduction in goodwill
              
              
              8,106,000Loss
                  on disposal of equipment
              
              
              94,000
              
              
              2,489Depreciation
                  and amortization
              
              
              238,126
              
              
              58,336Changes
                  in assets and liabilities:Increase
                  in accounts receivable
              
              
              (602,272
              )
              
              (243,757
              )Increase
                  in costs in excess of billings on uncompleted contracts
              
              
              (144,775
              )
              
              (113,724
              )(Increase)
                  decrease in inventory
              
              
              (1,583,960
              )
              
              109,895Increase
                  in prepaids and other
              
              
              (23,046
              )
              
              (6,990
              )Increase
                  (decrease) in accounts payable
              
              
              1,853,959
              
              
              (453,644
              )(Decrease)
                  increase in accrued payroll taxes
              
              
              (176,661
              )
              
              95,172Increase
                  in accrued expenses
              
              
              217,036
              
              
              63,971Increase
                  (decrease) in billings in excess of costs on uncompleted
                  contracts
              
              
              368,573
              
              
              (147,565
              )(Decrease)
                  increase in other accruals
              
              
              (379,401
              )
              
              36,126NET
                    CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES
              
              
              (2,718,221
              )
              
              (1,049,412
              )CASH
                  FLOWS FROM INVESTING ACTIVITIESCapital
                  additions
              
              
              (10,000
              )Cash
                  paid for acquisition of subsidiaries
              
              
              (205,000
              )Decrease
                  in advances to related parties
              
              
              141,277
              
              
              134,936Other
                  investments
              
              
              (578,064
              )Proceeds
                  on disposition of property and equipment
              
              
              21,000
              
              
              7,450Cash
                  paid for security deposits
              
              
              (223,758
              )
              
              (10,520
              )NET
                  CASH FLOWS USED IN INVESTING ACTIVITIES
              
              
              (649,545
              )
              
              (73,134
              )CASH
                  FLOWS FROM FINANCING ACTIVITIESCash
                  received in acquisition of subsidiaries
              
              
              458,433Proceeds
                  from issuance of promissory convertible notes payable
              
              
              1,303,950
              
              
              1,026,550Payment
                  on acquisition note
              
              
              (50,000
              )Payments
                  on capitalized leases
              
              
              (114,517
              )Increase
                  in bank borrowings
              
              
              540,434Increase
                  in notes payable, net
              
              
              570,229
              
              
              (46,241
              )Payments
                  on obligations to related parties
              
              
              (62,668
              )Proceeds
                  from issuance of common stock
              
              
              1,035,734
              
              
              345,000NET
                    CASH FLOWS PROVIDED BY (USED IN) FINANCINGACTIVITIES
              
              
              3,285,830
              
              
              1,721,074INCREASE
                  IN CASH
              
              
              81,936
              
              
              598,528CASH,
                  BEGINNING OF PERIOD
              
              
              603,452
              
              
              4,923CASH,
                  END OF PERIOD
              
              $
              685,388
              
              $
              603,451
 
 See
        accompanying notes to financial statements  F-5
 
 HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 CONSOLIDATED
        STATEMENT OF CASH FLOWS (CONTINUED)
 
 For
                  the Year Ended December 31,2005
              
              2004(Restated)SUPPLEMENTAL
                  DISCLOSURES OF CASH FLOW INFORMATIONInterest
                  paid
              
              $
              185,752
              
              $
              164,347Taxes
                  paid
              
              
              55,625
              
              
              40,533NON-CASH
                  INVESTING AND FINANCING ACTIVITIESLand
                  acquired by:Assuming
                  loan payable
              
              
              
              
              
              150,000Issuance
                  of common stock
              
              
              
              
              
              94,000Transportation
                  equipment acquired with notes payable
              
              
              
              
              
              61,094Issuance
                  of common stock in payment of obligation to related party
              
              
              
              
              
              15,000Issuance
                  of common stock as stock based compensation
              
              
              
              
              
              63,787Assets
                  acquired and liabilities assumed in acquisition of
                  subsidiaries:Cash
                  acquired
              
              
              
              
              
              458,433Accounts
                  receivable
              
              
              
              
              
              2,084,011Costs
                  in excess of billings on uncompleted contracts
              
              
              
              
              
              73,897Inventory
              
              
              
              
              
              4,423,332Prepaids
                  and other
              
              
              
              
              
              110,265Property,
                  plant and equipment
              
              
              
              
              
              452,364Advance
                  to related party
              
              
              
              
              
              281,122Goodwill
              
              
              
              
              
              9,253,147Security
                  deposits
              
              
              
              
              
              2,267Line
                  of credit
              
              
              
              
              
              (810,989
              )Notes
                  payable
              
              
              
              
              
              (2,012,205
              )Obligation
                  under capital lease
              
              
              
              
              
              (384,523
              )Accounts
                  payable
              
              
              
              
              
              (1,431,033
              )Acquisition
                  notes payable
              
              
              
              
              
              (3,300,000
              )Obligations
                  to related parties
              
              
              
              
              
              (205,095
              )Accrued
                  expenses
              
              
              
              
              
              (122,611
              )Billings
                  in excess of costs on uncompleted contracts
              
              
              
              
              
              (144,437
              )Customer
                  deposits
              
              
              
              
              
              (21,068
              )Deferred
                  income taxes
              
              
              
              
              
              (371,877
              )Issuance
                  of common stock
              
              
              
              
              
              (830,490
              )
 
 
 
 See
        accompanying notes to financial statements.
 F-6
  HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 CONSOLIDATED
        STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)
 For
        the
        Years Ended December 31, 2005 and 2004 (Restated)
 
 AdditionalCapital
                  Stock
              
              Paid
                  - In
              
              RetainedShares
              
              Capital
              
              Capital
              
              Earnings
              
              TotalBalance,
                  December 31, 2003
              
              
              13,077,758
              
              
              13,077
              
              
              4,313,801
              
              
              (5,604,886
              )
              
              (1,278,008
              )Correction
                  of shares issued in reverse merger
              
              
              703,082
              
              
              703
              
              
              (703
              )Shares
                  issued for services rendered at $0.05 per share
              
              
              1,105,730
              
              
              1,106
              
              
              54,181
              
              
              
              
              
              55,287Shares
                  issued in connection with law suit settlement
              
              
              170,000
              
              
              170
              
              
              8,330
              
              
              
              
              
              8,500Shares
                  issued for cash at a price ranging from $0.16 to $1.00
              
              
              1,204,396
              
              
              1,204
              
              
              343,796
              
              
              
              
              
              345,000Shares
                  issued to acquire property at $0.47 per share
              
              
              200,000
              
              
              200
              
              
              93,800
              
              
              
              
              
              94,000Shares
                  issued to settle loan @ $0.89 per share
              
              
              16,835
              
              
              17
              
              
              14,983
              
              
              
              
              
              15,000Issuance
                  of common stock in connection with acquisitions at $0.47 per
                  share
              
              
              
              
              
              1,767,000
              
              
              1,767
              
              
              8,333,233
              
              
              8,335,000Net
                  loss for the year ended December 31, 2004
              
              
              
              
              
              
              
              
              
              
              
              (513,508
              )
              
              (513,508
              )18,244,801
              
              
              18,244
              
              
              13,161,421
              
              
              (6,118,394
              )
              
              (7,061,271
              )Issuance
                  of common stock to Chief Executive Officer @$0.46 per
                  share
              
              
              
              
              
              1,500,000
              
              
              1,500
              
              
              688,500
              
              
              690,000Issuance
                  of common stock for cash at $0.50 to $1.00 per share
              
              
              1,696,236
              
              
              1,696
              
              
              1,034,037
              
              
              
              
              
              1,035,733Issuance
                  of common stock for conversion of convertible notes at $0.50 per
                  share
              
              
              100,000
              
              
              100
              
              
              79,900
              
              
              
              
              
              80,000Issuance
                  of common stock for settlement of accounts payable obligation @$1.03
                  per
                  share
              
              
              75,000
              
              
              75
              
              
              77,115
              
              
              
              
              
              77,190
  See
          accompanying notes to financial statements.
 F-7
  HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 CONSOLIDATED
          STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)(CONTINUED)
 For
          the
          Years Ended December 31, 2005 and 2004 (Restated)
  AdditionalCapital
                      Stock
                  
                  Paid
                      - In
                  
                  RetainedShares
                  
                  Capital
                  
                  Capital
                  
                  Earnings
                  
                  TotalIssuance
                      of common stock for services rendered to the Company at $0.50
                      to $1.00 per
                      share
                  
                  
                  875,770
                  
                  
                  876
                  
                  
                  650,452
                  
                  
                  
                  
                  
                  651,328Issuance
                      of common stock for acquisitions @$0.50 per share
                  
                  
                  783,000
                  
                  
                  783
                  
                  
                  8,217
                  
                  
                  
                  
                  
                  9,000Issuance
                      of common stock to settle various legal disputes @$0.50 to
                      $1.00 per share
                  
                  
                  467,064
                  
                  
                  467
                  
                  
                  311,190
                  
                  
                  
                  
                  
                  311,657Issuance
                      of common stock for interest payments
                  
                  
                  4,153
                  
                  
                  5
                  
                  
                  2,070
                  
                  
                  
                  
                  
                  2,075Loan
                      for year ended December 31, 2005
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (12,338,785
                  )
                  
                  (4,610,505
                  )23,746,024
                  
                  $
                  23,746
                  
                  $
                  16,566,152
                  
                  $
                  (18,457,179
                  )
                  $
                  2,420,530
  See
          accompanying notes to financial statements.
 F-8
  HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 
 NOTE
          A -
          PRINCIPLES OF CONSOLIDATION AND NATURE OF BUSINESS
 
 The
          consolidated financial statements include the accounts of Heartland, Inc.
          (formerly International Wireless, Inc.) (“Heartland”) and its wholly owned
          subsidiaries, Mound Technologies, Inc. (“Mound”) a steel fabricator acquired in
          December 2003, Evans Columbus, LLC (“Evans”) a steel drum manufacturer, Monarch
          Homes, Inc. (“Monarch”) a residential home builder and Karkela Construction,
          Inc. (“Karkela”) a commercial construction contractor, all of which were
          acquired in December 2004. As indicated in Note D, the consolidated financial
          statements also include the accounts of three entities deemed to be Variable
          Interest Entities (VIEs), PAR Investments, LLC, which owns the land and
          building
          rented to Evans Columbus as its headquarters, Mundus Environmental Products,
          Inc. and Wyncrest Group, Inc., Investment Companies.
 
 Merger
          and Reverse Merger
 
 On
          December 1, 2003, PMI Wireless, Inc., a private company, in a change of
          control,
          acquired 9,938,466 shares of International Wireless, Inc. common stock
          for
          $71,000 cash and the assumption of the Company’s liabilities, thereby obtaining
          control of the company. Simultaneously, the Company authorized a 30 for
          1
          reverse split. Subsequent to this split, PMI Wireless, Inc. controlled
          84% of
          the outstanding common stock of the Company.
 
 On
          December 15, 2004, the Company reverse merged with Mound through the issuance
          of
          1,256,000 shares of its common stock in exchange for all of the issued
          and
          outstanding shares of Mound. Prior to the merger, International Wireless,
          Inc.
          was a non-operating shell corporation. Pursuant to Securities and Exchange
          Commission rules, the merger of a private operating company (Mound) into
          a
          non-operating public shell corporation with nominal net assets (International
          Wireless, Inc.) is considered a capital transaction. Accordingly, for accounting
          purposes, the merger has been treated as a reverse merger of Mound with
          the
          Company and a recapitalization of the Company.
 
 Going
          Concern Uncertainty and Management’s Plans
 
 As
          reflected in the accompanying financial statements, the Company has current
          liabilities of $4,568,118 in excess of current assets resulting in negative
          working capital and an accumulated deficit of $10,728,899. Management is
          presently seeking to raise permanent equity capital in the capital markets
          or
          some form of long-term debt instrument to eliminate the negative working
          capital. Additionally, the Company is seeking to acquire additional profitable
          companies. Failure to raise equity capital or secure some other form of
          long-term debt arrangement will cause the Company to further increase its
          negative working capital deficit. However, there are no assurances that
          the
          Company will succeed in the obtaining of equity financing or some form
          of
          long-term debt instrument.
 
 NOTE
          B -
          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 Use
          of
          Estimates
 
 The
          preparation of financial statements in conformity with generally accepted
          accounting principles requires management to make estimates and assumptions
          that
          affect the amounts reported in the financial statements and accompanying
          notes.
          Actual results could differ from those estimates.
 
 
 
 F-9
 HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 
 NOTE
          B -
          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
 Cash
          and Cash Equivalents
  The
          company considers all highly-liquid investments, with a maturity of three
          months
          or less when purchased, to be cash equivalents.
 
 Net
          Loss Per Common Share
 
 The
          Company computes per share amounts in accordance with Statement of Financial
          Accounting Standards (“SFAS”) No. 128, “Earnings per Share”. SFAS No. 128
          requires presentation of basic and diluted EPS. Basic EPS is computed by
          dividing the income (loss) available to Common Stockholders by the
          weighted-average number of common shares outstanding for the period. Diluted
          EPS
          is based on the weighted-average number of shares of Common Stock and Common
          Stock equivalents outstanding during the periods.
 
 Business
          Combinations and Goodwill
 
 The
          Company follows the purchase method of accounting for business combinations
          as
          required under SFAS No. 141 and SFAS No. 142 for Goodwill and Other Intangible
          Assets.
 
 Property,
          Plant and Equipment and Depreciation
 
 Property,
          plant and equipment is stated at cost and is depreciated using the straight
          line
          method over the estimated useful lives of the respective assets. Routine
          maintenance, repairs and replacement costs are expensed as incurred and
          improvements that extend the useful life of the assets are capitalized.
          When
          property, plant and equipment is sold or otherwise disposed of, the cost
          and
          related accumulated depreciation are eliminated from the accounts and any
          resulting gain or loss is recognized in operations.
 
 Stock-Based
          Compensation
 
 SFAS
          No.
          123, “Accounting for Stock-Based Compensation” prescribes accounting and
          reporting standards for all stock-based compensation plans, including employee
          stock options, restricted stock, employee stock purchase plans and stock
          appreciation rights. SFAS No. 123 requires employee compensation expense
          to be
          recorded (1) using the fair value method or (2) using the intrinsic value
          method
          as prescribed by accounting Principles Board Opinion No. 25, “Accounting for
          Stock Issued to Employees” (“APB25”) and related interpretations with pro forma
          disclosure of what net income and earnings per share would have been if
          the
          Company adopted the fair value method. The Company accounts for employee
          stock
          based compensation in accordance with the provisions of APB 25. For non-employee
          options and warrants, the company uses the fair value method as prescribed
          in
          SFAS 123.
 
 The
          Company accounts for stock issued for services using the fair value method.
          In
          accordance with the Emerging Issues Task Force (“EITF”) 96-18, the measurement
          date of shares issued for service is the date at which the counterparty’s
          performance is complete.
 
 Allowance
          for Doubtful Accounts
 
 It
          is the
          company’s policy to provide an allowance for doubtful accounts when it believes
          there is a potential for non-collectibility.
 F-10
 HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 
 NOTE
          B -
          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
 Inventories
 
 Inventories
          are stated at the lower of cost or market value. Cost is determined using
          the
          first-in, first-out (FIFO) method.
 
 Revenue
          Recognition
 
 The
          Company recognizes revenue when the product is manufactured and shipped.
          Revenues from fixed-price and modified fixed-price construction contracts
          are
          recognized on the percentage-of-completion method, measured by the percentage
          of
          total cost incurred to date to estimated total cost for each contract.
          This
          method is used because management considers expended total cost to be the
          best
          available measure of progress on these contracts. Revenues from cost-plus-fee
          contracts are recognized on the basis of costs incurred during the period
          plus
          the fee earned, measured by the cost-to-cost method.
 
 Contracts
          to manage, supervise, or coordinate the construction activity of others
          are
          recognized only to the extent of the fee revenue. The revenue earned in
          a period
          is based on the ratio of total cost incurred to the total estimated total
          cost
          required by the contract.
 
 Contract

          costs include all direct material and labor costs and those indirect costs
          related to contract performance, such as indirect labor, supplies, tools,
          repairs, and depreciation costs. Selling, general, and administrative costs
          are
          charged to expense as incurred. Provisions for estimated losses on uncompleted
          contracts are made in the period in which such losses are determined. Changes
          in
          job performance, job conditions, and estimated profitability, including
          those
          arising from contract penalty provisions, and final contract settlements
          may
          result in revisions to costs and income and are recognized in the period
          in
          which the revisions are determined. Profit incentives are included in revenues
          when their realization is reasonably assured. An amount equal to contract
          costs
          attributable to claims is included in revenues when realization is probable
          and
          the amount can be reliably estimated.
 
 The
          asset, “Costs in excess of billings on uncompleted contracts,” represents
          revenues recognized in excess of amounts billed. The liability, “Billings in
          excess of costs on uncompleted contracts,” represents billings in excess of
          revenues recognized.
 
 Impairment
          of Long-Lived Assets
 
 The
          Company reviews long-lived assets for impairment whenever events or changes
          in
          circumstances indicate the carrying amount of an asset may not be recoverable.
          Recoverability of assets to be held and used is measured by a comparison
          of the
          carrying amount of an asset to future undiscounted net cash flows expected
          to be
          generated by the asset. If such assets are considered to be impaired, the
          impairment to be recognized is measured by the amount by which the carrying
          amount of the assets exceeded the fair value of the assets.
 
 Recent
          Accounting Pronouncements
 
 In
          November 2004, the Financial Accounting Standards Board (“FASB”) issued
          Statement of Financial Accounting Standards No. 151 (SFAS 151), “Inventory
          Costs.” SFAS 151 amends the guidance in APB No. 43, Chapter 4, “Inventory
          Pricing,” to clarify the accounting for abnormal amounts of idle facility
          expense, freight, handling costs, and wasted material (spoilage). SFAS
          151
          requires that those items be
 F-11
  HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 
 NOTE
          B -
          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
 Recent
          Accounting Pronouncements (Continued )
 
 recognized
          as current period charges regardless of whether they meet the criteria
          of “so
          abnormal.” In addition, SFAS 151 requires that allocation of fixed production
          overheads to the costs of conversion be based on the normal capacity of
          the
          production facilities. SFAS 151 is effective for financial statements issued
          for
          fiscal years beginning after June 15, 2005. The adoption of SFAS 151 is
          not
          expected to have a material effect on the Company’s financial position or
          results of operations.
  In
          December 2004, the FASB issued Statement of Financial Accounting Standards
          No.
          153 (SFAS 153), “Exchanges of Non-monetary Assets.” SFAS 153 amends the guidance
          in APB No. 29, “Accounting for Non-monetary Assets.” APB No.29 was based on the
          principle that exchanges of non-monetary assets should be measured on the
          fair
          value of the assets exchanged. SFAS 153 amends APB No. 29 to eliminate
          the
          exception for non-monetary exchanges of similar productive assets and replaces
          it with a general exception for exchanges of non-monetary assets that do
          not
          have commercial substance if the future cash flows of the entity are expected
          to
          change significantly as a result of the exchange. SFAS 151 is effective
          for
          financial statements issued for fiscal years beginning after June 15, 2005.
          The
          adoption of SFAS 153 is not expected to have a material effect on the Company’s
          financial position or results of operations.
 
 In
          December 2004, the FASB revised Statement of Financial Accounting Standards
          No.
          123 (SFAS 123(R)), “Accounting for Stock-Based Compensation.” The SFAS 123(R)
          revision established standards for the accounting for transactions in which
          an
          entity exchanges its equity instruments for goods or services and focuses
          primarily on accounting for transactions in which an entity obtains employee
          services in share-
 based
          payment transactions. It does not change the accounting guidance for share-based
          payment transactions with parties other than employees. For public entities
          that
          file as small business issuers, the revisions to SFAS 123(R) are effective
          as of
          the beginning of the first interim or annual reporting period that begins
          after
          December 15, 2005. The adoption of SFAS 123(R) is not expected to have
          a
          material effect on the Company’s financial position or results of
          operations.
 
 In
          May
          2005, the FASB issued SFAS no. 154, “Accounting Changes and Error Corrections
          (“SFAS No. 154”) which replaces APB Opinion No. 20, “Accounting Changes” and
          SFAS No. 3, “Reporting Accounting Changes in Interim Financial Statements-An
          Amendment of ABP Opinion No. 28. SFAS No. 154 provides guidance on the
          accounting for and reporting of accounting changes and error corrections.
          Specially, this statement requires “retrospective application” of the direct
          effect for a voluntary change in accounting principle to prior periods’
financial statements, if it is practical to do so. SFAS No. 154 also strictly
          defines the term “restatement” to mean the correction of an error revising
          previously issued financial statements. Although, SFAS No. 154 is effective
          for
          accounting changes and corrections of errors made in fiscal years beginning
          after December 15, 2005, the Company has adopted this SFAS in the current
          year.
 
 NOTE
          C -
          ACQUISITIONS
 
 2004
 
 On
          December 27, 2004, the Company acquired 100% of Monarch Homes Inc. (“Monarch”).
          The acquisition price consisted of 1) $100,000 in cash, 2) a promissory
          note of
          $1,900,000 payable on or before February 15, 2005 which, if not paid by
          that
          date will include interest at 8% to payment date, and 3) 667,000 restricted
          shares of the Company’s common stock. The original agreement indicated that
  F-12






HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 December
        31, 2005
 
 
 NOTE
        C -
        ACQUISITIONS (CONTINUED)
 
 should
        the common stock of the Company not be trading at a minimum of $5 per share
        as
        of December 27, 2005, the Company must compensate the seller for the difference
        in additional shares of common stock. On December 30, 2005, the agreement
        was
        amended to require issuance of an additional 333,000 of restricted shares
        of
        common stock.
 
 On
        December 30, 2004, the Company acquired 100% of Evans Columbus, LLC (“Evans”).
        The acquisition price consisted of 1) $5,000 in cash, and 2) 600,000 restricted
        shares of the Company’s common stock. The original agreement indicated that
        should the common stock not be trading at a minimum of $5 per share as of
        December 30, 2005, the Company must compensate the seller for the difference
        in
        additional shares of common stock. See Note T Subsequent Events as to status
        of
        this agreement at May 19, 2006.
 
 On
        December 31, 2004, the Company acquired 100% of Karkela Construction, Inc.
        (“Karkela”). The acquisition price consisted of 1) $100,000 in cash, 2) a
        promissory note payable of $50,000 due on or before January 31, 2005, 3)
        a
        promissory note of $1,350,000 payable on or before March 31, 2005 which if
        not
        paid by that date, will include interest from December 31, 2005 at 8% to
        payment
        date, and 4) 500,000 restricted shares of the Company’s common stock. The
        original agreement indicated that should the common stock of the Company
        not be
        trading at a minimum of $4 per share as of December 31, 2005, the company
        must
        compensate the seller for the difference in additional shares of common stock.
        On December 31, 2005, the agreement was modified to require an additional
        cash
        payment of $55,000 and issuance of an additional 350,000 shares of common
        stock.
 
 The
        allocation of the purchase price (restated) for these acquisitions was as
        follows:
 
 EvansMonarch
              
              Columbus
              
              KarkelaCash
                  payment
              
              $
              100,000
              
              $
              5,000
              
              $
              100,000Promissory
                  notes
              
              
              1,900,000
              
              
              1,400,000Common
                  stock shares
              
              
              667,000
              
              
              600,000
              
              
              500,000Value
                  per share
              
              
              0.47
              
              
              0.47
              
              
              0.47Total
                  Common Stock
              
              
              313,490
              
              
              282,000
              
              
              235,000Total
                  value of contingent shares to be issued
              
              
              3,021,510
              
              
              2,718,000
              
              
              1,765,000Total
                  Purchase Price
              
              $
              5,335,000
              
              $
              3,005,000
              
              $
              3,500,000Fair
                  value of net assets acquired:Cash
              
              $
              150,996
              
              $
              114,016
              
              $
              193,421IntangiblesLoan
                  receivable
              
              
              202,965
              
              
              78,157Accounts
                  receivable
              
              
              
              
              
              637,060
              
              
              1,446,951Costs
                  in excess of billings
              
              
              
              
              
              
              
              
              73,897Inventory
              
              
              3,843,570
              
              
              579,762Property,
                  plant and equipment
              
              
              160,834
              
              
              460,586
              
              
              34,655Other
                  assets
              
              
              
              
              
              39,446
              
              
              76,414Liabilities
                  assumed
              
              
              (2,556,762
              )
              
              (1,622,027
              )
              
              (1,431,228
              )Customer
                  list
              
              
              
              
              
              257,500
              
              
              22,500Tradename
              
              
              240,000Goodwill
              
              
              3,293,397
              
              
              840,481
              
              
              3,083,390$
              5,335,000
              
              $
              3,005,000
              
              $
              3,500,000
 
 F13
  HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 December
        31, 2005
 
 
 NOTE
        C -
        ACQUISITIONS (CONTINUED)
 
 Condensed
        Financial Information at December 31, 2004 and for the year then ended for
        the
        2004 acquisitions is as follows:
 
 EvansMonarch
              
              Columbus
              
              KarkelaSales
              
              $
              22,913,341
              
              $
              7,921,792
              
              $
              11,783,566Total
                  costs and expenses
              
              
              21,987,553
              
              
              7,878,659
              
              
              11,476,049Net
                  operating income
              
              
              925,788
              
              
              43,133
              
              
              307,517Other
                  income (expenses)
              
              
              (45,349
              )
              
              (59,155
              )
              
              (14,986
              )Income
                  (loss) before taxes
              
              
              880,349
              
              
              (16,022
              )
              
              292,531Deferred
                  Federal and State income taxes
              
              
              84,170Net
                  Income (loss)
              
              $
              796,269
              
              $
              (16,022
              )
              $
              292,531Total
                  current assets
              
              $
              1,368,017
              
              $
              1,787,355
              
              $
              3,994,566Property,
                  plant and equipment, net
              
              
              388,734
              
              
              35,944
              
              
              160,834Other
                  assets
              
              
              80,424
              
              
              
              
              
              202,965Investment
                  in subsidiariesTotal
                  Assets
              
              $
              1,837,175
              
              $
              1,823,299
              
              $
              4,358,365Total
                  current liabilities
              
              $
              1,315,720
              
              $
              1,325,049
              
              $
              2,556,762Total
                  long-term liabilities
              
              
              306,307Stockholders’
                  Equity (Deficit)Common
                  stock
              
              
              
              
              
              100
              
              
              10,000Additional
                  paid-in capital
              
              
              
              
              
              900Accumulated
                  deficit
              
              
              215,148
              
              
              497,250
              
              
              1,791,603Total
                  Stockholders’ Equity
              
              
              215,148
              
              
              498,250
              
              
              1,801,603Total
                  Liabilities and Stockholders’ Equity
              
              $
              1,837,175
              
              $
              1,823,299
              
              $
              4,358,365
 
 F14
   HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 December
        31, 2005
 
 
 NOTE
        C -
        ACQUISITIONS (CONTINUED)
 
 Condensed
        pro forma consolidating statements for the 2004 acquisitions are as
        follows:
 
 
 Heartland
              
              Evans
                Columbus
              
              Karkela
              
              Monarch
              
              Eliminating
                Adjustments
              
              ConsolidatedSales
              
              $
              7,389,064
              
              $
              7,921,792
              
              $
              11,783,566
              
              $
              22,913,341
              
              
              
              
              $
              50,007,763Total
                  costs and expenses
              
              
              7,938,207
              
              
              7,878,659
              
              
              11,476,049
              
              
              21,987,553
              
              
              
              
              
              49,280,468Net
                  operating income
              
              
              (549,143
              )
              
              43,133
              
              
              307,517
              
              
              925,788
              
              
              
              
              
              727,295Other
                  income (expenses)
              
              
              145,474
              
              
              (59,155
              )
              
              (14,986
              )
              
              (45,349
              )
              
              
              
              
              25,984Income
                  (loss) before taxes
              
              
              (403,669
              )
              
              (16,022
              )
              
              292,531
              
              
              880,439
              
              
              
              
              
              753,279Deferred
                  Federal and State income taxes
              
              
              
              
              
              
              
              
              
              
              
              84,170
              
              $
              328,240
              
              
              412,410Net
                  income (loss)
              
              $
              (403,669
              )
              $
              (16,022
              )
              $
              292,531
              
              $
              796,269
              
              $
              (328,240
              )
              
              340,869
 
 F15
  HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 December
        31, 2005
  NOTE
        C -
        ACQUISITIONS (CONTINUED)
 
 Heartland
              
              Evans
                Columbus
              
              Karkela
              
              Monarch
              
              Eliminating
                Adjustments
              
              
              
              ConsolidatedTotal
                  current assets
              
              $
              2,116,891
              
              $
              1,368,017
              
              $
              1,787,355
              
              $
              3,994,566
              
              
              
              
              
              
              
              $
              9,266,829Property
                  plant and equipment, net
              
              
              1,219,321
              
              
              388,734
              
              
              35,944
              
              
              160,834
              
              $
              71,852
              
              
              *3,4*
              
              
              1,876,685Goodwill
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              9,253,147
              
              
              *1,2,3,4,5*
              
              
              9,253,147Other
                  assets
              
              
              11,520
              
              
              80,424
              
              
              
              
              
              202,965
              
              
              294,909Investment
                  in subsidiaries
              
              
              4,335,490
              
              
              
              
              
              
              
              
              
              
              
              (4,335,490
              )
              
              *1,2,3*Total
                  Assets
              
              $
              7,683,222
              
              $
              1,837,175
              
              $
              1,823,299
              
              $
              4,358,365
              
              $
              (2,515,001
              )
              
              
              
              $
              20,691,570Total
                  Current Liabilities
              
              $
              7,326,390
              
              $
              1,315,720
              
              $
              1,325,049
              
              $
              2,556,762
              
              
              
              
              
              
              
              $
              12,523,921Total
                  Long-Term Liabilities
              
              
              690,232
              
              
              306,307
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              996,539Stockholders’
                  equity (deficit)Common
                  stock
              
              
              18,244
              
              
              
              
              
              100
              
              
              10,000
              
              $
              (10,000
              )
              
              *1,2*
              
              
              18,244Additional
                  paid-in capital
              
              
              5,656,911
              
              
              
              
              
              900
              
              
              
              
              
              (900
              )
              
              *1,5*
              
              
              13,161,421Accumulated
                  deficit
              
              
              (6,008,555
              )
              
              215,148
              
              
              497,250
              
              
              1,791,603
              
              
              (2,504,001
              )
              
              
              
              
              (6,008,555
              )Total
                  Stockholders’ Equity (Deficit)
              
              
              (333,400
              )
              
              215,148
              
              
              498,250
              
              
              1,801,603
              
              
              (2,515,001
              )
              
              
              
              
              (7,171,110
              )Total
                  Liabilities and Stockholders’Equity
                  (Deficit)
              
              $
              7,683,222
              
              $
              1,837,175
              
              $
              1,823,299
              
              $
              4,358,365
              
              $
              (2,515,001
              )
              
              
              
              $
              20,691,570
  *1*   To
        record
        good will and eliminate investment in Karkela Construction, Inc.
 *2*   To
        record
        good will and eliminate investment in Monarch Homes, Inc.
 *3*   To
        record
        negative good will and eliminate investment in Evans Columbus, LLC.
 *4* To
        adjust
        reduce costs of property, plant and equipment and negative goodwill in Evans
        Columbus, LLC.
 *5* To
        record additional goodwill arising from valuation of contingent shares to
        be
        issued in connection with acquisition of Karkela, Monarch and Evans
 Columbus.
 F16
   HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 December
        31, 2005
 
 
 NOTE
        C -
        ACQUISITIONS (CONTINUED)
 
 2005
 
 During
        the year ended December 31, 2005, the Company announced the following proposed
        acquisitions, none of which has been consummated to date:
 
 On
        July
        29, 2005, the Company entered into a binding stock purchase agreement to
        acquire
        Persinger Equipment, Inc. for $4,735,000 payable 1) $2,000,000 in cash before
        February 1, 2006 or the agreement becomes null and void 2) $2,735,000 in
        cash or
        911,667 non-restricted shares of common stock at the Company’s option at
        closing. Should the common stock not be trading at a minimum of $3 per share
        twelve months after closing, the Company must compensate the seller for the
        difference in additional shares of common stock. Under the terms of the
        agreement, the Company is to deposit 100,000 restricted shares of common
        stock
        to be retained by Persinger should the Company default on the agreement.
        The
        agreement further calls for a 5 year employment agreement with Steven Persinger
        for a base salary of $120,000 per year.
 
 On
        September 12, 2005, the Company entered into a binding agreement to acquire
        Ney
        Oil Company for $5,000,000 payable 1) $3,000,000 in cash 2) 1,333,000 shares
        of
        common stock to be valued at not less than $2,000,000 three business days
        prior
        to closing or the number shall be increased accordingly.
 
 On
        September 26, 2005, the Company entered into a binding acquisition agreement
        to
        acquire Schulz Oil Company, Inc. for $3,500,000 payable 1) $1,500,000 in
        cash 2)
        1,000,000 shares of common stock which shall have a value of at least $2
        per
        share at the end of 2 years or the Company will pay the difference.
 
 On
        September 12, 2005, the Company entered into a letter of intent to acquire
        NKR,
        Inc. doing business as Ohio Valley Lumber for 1) $4,000,000 in cash 2) 2,000,000
        shares of common stock 3) an infusion of $2,000,000 into the Company to reduce
        debt.
 
 On
        September 21, 2005 the Company entered into a binding agreement to acquire
        Lee
        Oil Company for $6,000,000 payable 1) $5,000,000 in cash 2) $1,000,000 in
        common
        stock valued at the closing date but not less than 1,000,000 common
        shares.
 
 
 F17
 
  HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 December
        31, 2005
 
 
 NOTE
        C -
        ACQUISITIONS (CONTINUED)
 
 Condensed
        unaudited Financial Information at December 31, 2005 and for the year then
        ended
        for these contemplated acquisitions is as follows:
 
 Persinger
              
              Schulz
              
              Ohio
                Valley
                Lumber
              
              Ney
                Oil
              
              Lee
                Oil(November
                  2005)
              
              
              
              (June
                  2005)Total
                  current assets
              
              $
              2,804,940
              
              $
              1,185,690
              
              $
              5,975,668
              
              $
              2,850,748
              
              $
              5,878,247Property
                  plant and equipment, net
              
              
              38,718
              
              
              646,573
              
              
              5,136,814
              
              
              2,794,917
              
              
              5,347,498Other
                  assets
              
              
              212,737
              
              
              329,811
              
              
              1,534,354
              
              
              554,362
              
              
              44,467Total
                  Assets
              
              
              3,056,395
              
              
              2,162,074
              
              
              12,646,836
              
              
              6,200,027
              
              
              11,270,212Total
                  Current Liabilities
              
              
              1,896,117
              
              
              722,763
              
              
              6,501,606
              
              
              2,287,674
              
              
              2,743,822Total
                  Long-Term Liabilities
              
              
              361,930
              
              
              1,062,114
              
              
              3,878,587
              
              
              1,889,873
              
              
              4,819,059Stockholders’
                  equityCommon
                  stock
              
              
              40,000
              
              
              22,831
              
              
              1,933
              
              
              120,000
              
              
              1,000Additional
                  paid-in capital
              
              
              105,000
              
              
              1,577,627
              
              
              57,708Treasury
                  stock
              
              
              (600,000
              )Accumulated
                  earnings
              
              
              1,253,347
              
              
              354,366
              
              
              687,083
              
              
              1,902,480
              
              
              3,648,623Total
                  Stockholders’ Equity
              
              
              798,347
              
              
              377,197
              
              
              2,266,643
              
              
              2,022,480
              
              
              3,707,331Total
                  Liabilities and Stockholders’Equity
              
              
              3,056,394
              
              
              2,162,074
              
              
              12,646,836
              
              
              6,200,027
              
              
              11,270,212Sales
              
              
              11,988,474
              
              
              17,268,691
              
              
              6,543,453
              
              
              54,480,538
              
              
              79,092,224Total
                  costs and expenses
              
              
              11,850,756
              
              
              17,112,980
              
              
              6,406,916
              
              
              54,410,701
              
              
              78,357,415Net
                  operating income
              
              
              137,718
              
              
              155,711
              
              
              136,537
              
              
              69,837
              
              
              734,809Other
                  income (expenses)
              
              
              38,151
              
              
              (96,344
              )
              
              (87,240
              )
              
              293,284
              
              
              (15,784
              )Income
                  before taxes
              
              
              175,869
              
              
              59,367
              
              
              49,297
              
              
              363,121
              
              
              719,025Federal
                  and State income taxes
              
              
              (64,557
              )
              
              
              
              
              (10,886
              )
              
              (21,000
              )
              
              (129,355
              )Net
                  income
              
              
              111,312
              
              
              59,367
              
              
              38,411
              
              
              342,121
              
              
              589,670
  Condensed
        pro forma consolidating statements for 2005 for the above proposed acquisitions
        are as follows:
 
 2005Proposed
              
              Eliminating
              
              Pro
                  FormaHeartland
              
              Acquisitions
              
              Adjustments
              
              ConsolidatedSales
              
              
              40,674,714
              
              
              169,373,380
              
              
              
              
              
              210,048,094Total
                  costs and expenses
              
              
              44,558,857
              
              
              168,138,768
              
              
              
              
              
              212,697,625Net
                  operating income
              
              
              (3,884,143
              )
              
              1,234,612
              
              
              
              
              
              (2,649,531
              )Other
                  income (expenses)
              
              
              (748,990
              )
              
              132,067
              
              
              
              
              
              (616,923
              )Income
                  (loss) before taxes
              
              
              (4,633,133
              )
              
              1,366,679
              
              
              
              
              
              (3,266,454
              )Deferred
                  Federal and State income taxes
              
              
              (22,628
              )
              
              (225,798
              )
              
              
              
              
              (248,426
              )Net
                  income (loss)
              
              
              (4,610,505
              )
              
              1,592,477
              
              
              
              
              
              (3,018,028
              )
 
 F18
  HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 December
        31, 2005
 
 
 NOTE
        D -
        VARIABLE INTEREST ENTITIES
 
 In
        January 2003, the FASB issued FIN 46 and in December 2003, it issued a revised
        interpretation of FIN 46 (FIN 46-R), which supersedes FIN 46 and clarifies
        and
        expands current accounting guidance for determining whether certain entities
        should be consolidated in the Company’s consolidated financial statements. An
        entity is subject to FIN 46 and is called a Variable Interest Entity (VIE)
        if it
        has (1) equity that is insufficient to permit the entity to finance its
        activities without additional subordinated financial support from other parties,
        or (2) equity investors that cannot make significant decisions about the
        entity’s operations, or that do not absorb the expected losses or receive the
        expected returns of the entity. A VIE is consolidated by its primary
        beneficiary, which is the party that has a majority of the expected losses
        or a
        majority of the expected residual returns of the VIE, or both.
 
 The
        Company has concluded that three entities, Mundus Environmental Products,
        Inc.
        (“Mundus”) and Wyncrest Group, Inc. (“Wyncrest”) and PAR Investments, LLC are
        deemed to be VIEs under FIN 46 and accordingly they have been consolidated
        in
        the financial statements for 2005 and 2004.
 
 Mundus
        ,
        acquired in 2005, has assets of $12,866, liabilities of $142,425 and an
        accumulated deficit of $2,339,692 at December 31, 2005 and a net loss of
        $260,603 for the year then ended. Wyncrest had assets of $44,840 and $19,291,
        liabilities of $623,043 and $121,143 and an accumulated deficit of $749,058
        and
        $290,559 at December 31, 2005 and 2004 and net losses of $476,351 and $188,707
        for the years then ended, respectively. These companies, which are in the
        investment business, had no revenues during these years. Expenses consisted
        primarily of compensation, consulting expense and professional fees. Par
        Investments, LLC., a real estate holding company had assets of $2,003,385
        and
        $1,993,740, liabilities of $1,711,750 and $1,750,326 and retained earnings
        of
        $204,127 and $125,906 at December 31, 2005 and 2004 and net income of $78,221
        and $78,868 for the years then ended, respectively.
 
 NOTE
        E -
        INVENTORY
 
 Inventory
        consists of the following at December 31,
 
 2005
              
              2004Raw
                  material
              
              $
              1,155,336
              
              $
              959,692Work
                  in process - manufacturing
              
              
              135,539
              
              
              125,658Work
                  in process - home construction
              
              
              2,464,384
              
              
              1,108,892Land
                  held for development
              
              
              6,530,942
              
              
              2,734,677Finished
                  goods
              
              
              4,850
              
              
              3,710$
              10,291,051
              
              $
              4,932,629
 
 F19
  
 HEARTLAND,
        INC. AND SUBSIDIARIES
 (Formerly
        International Wireless, Inc.)
 
 NOTES
        TO
        CONSOLIDATED FINANCIAL STATEMENTS
 December
        31, 2005
 
 
 NOTE
        F -
        PROPERTY, PLANT, AND EQUIPMENT
 
 Property,
        plant, and equipment consists of the following at December 31,
 
 2005
              
              2004
              
              Years
                  of
                Average
                Uselful
                  LifeLand
              
              $
              473,400
              
              $
              717,400Leasehold
                  improvements
              
              
              87,715
              
              
              44,724
              
              
              5Buildings
              
              
              2,362,600
              
              
              2,362,600
              
              
              30Furniture
                  and fixtures
              
              
              172,149
              
              
              194,074
              
              
              10Machinery
                  and equipment
              
              
              2,530,108
              
              
              950,587
              
              
              10-15Automotive
                  equipment
              
              
              360,960
              
              
              331,061
              
              
              75,986,932
              
              
              4,600,446Less:
                  accumulated depreciation
              
              
              1,264,165
              
              
              816,069$
              4,722,767
              
              $
              3,784,377
 
 
 NOTE
        G -
        BANK LINES OF CREDIT
 
 A
        Company
        subsidiary has a $2,000,000 revolving line of credit with a bank through
        July
        2006 of which $939,011 is available at December 31, 2005. The line bears
        interest at 1.85% plus the London InterBank Offered Rate (“LIBOR”). At December
        31, 2005, the LIBOR was 3.10%. The line is limited to 80% of eligible accounts
        receivable plus 50% of eligible inventory. The line is collateralized by
        substantially all of the subsidiary’s assets and a $1,500,000 life insurance
        policy on the life of a stockholder. At December 31, 2005, the Company had
        an
        outstanding balance due of $1,060,989 on this line.
 
 A
        Company
        subsidiary has a $300,000 line of credit with a bank through July 2006 of
        which
        $0 is available at December 31, 2005. The line bears interest at prime plus
        0.75% and is collateralized by the assets of the subsidiary. At December
        31,
        2005, the Company had an outstanding balance of $300,000.
 
 NOTE
        H -
        NOTES PAYABLE - LAND PURCHASES
 
 The
        Monarch Homes, Inc. subsidiary acquires improved building lots for future
        home
        construction. The purchases are financed through two financial institutions
        -
        Contractors Capital Corporation and Premier Funding of Minnesota, or by
        developers. The Company’s outstanding indebtedness aggregated $5,740,160 and
        $1,965,698 at December 31, 2005 and 2004, respectively. The loans are secured
        by
        the land. See Note E - Inventory - land held for development. The notes bear
        interest at a rate of 1% - 2% over prime and are repayable at the time the
        constructed homes are sold.
 
 NOTE
        I -
        CONVERTIBLE PROMISSORY NOTES PAYABLE
 
 The
        Company issued $1,680,700 in convertible promissory notes to various individuals
        and organizations. The notes are unsecured, due within 1 year from date of
        issue, and bear interest at the rate of 10%. The notes can be converted into
        common stock of the Company. Of the $1,026,550 outstanding, $695,550 are
        convertible at $1.00 per share and $331,000 are convertible at $.50 per share.
        Subsequent to December 31, 2005, $1,218,921 in notes and accrued interest
        were
        converted into 2,437,839 shares of the Company.
  F20
  HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 NOTE
          J -
          NOTES PAYABLE
 
 Notes
          payable consist of the following at December 31:
 
 2005
                    
                    
                    2005Note
                        payable to bank due December 2009, payable in 59 monthlyprincipal
                        installments of $775 plus interest at prime (5.25% atDecember
                        31, 2005). The note is collateralized by substantiallyall
                        of the subsidiary's assets and a $1,500,000 life insurancepolicy
                        on a Company stockholder
                    
                    $
                    35,760
                    
                    $
                    46,507Notes
                        payable to banks due February 2010 and March 2010, payable
                        in72
                        monthly installments of $734 and $284 including interest
                        at6.18%
                        and 6.27%, respectivelyThe
                        notes are collateralized by transportation equipment
                    
                    
                    
                    
                    
                    54,645Mortgage
                        notes payable to a bank due March 2017 and May 2017,
                        payablein
                        180 monthly installments of $2,260 and $2,739 includinginterest
                        at 7.50% and 7.25%, respectively. The notes arecollateralized
                        by buildings
                    
                    
                    
                    
                    
                    485,294Notes
                        payable to banks due November 2012, payable monthlyinstallments
                        of $7,563 bearing interest at 6.49%. The notes arecollateralized
                        by the land and building of a subsidiary
                    
                    
                    1,633,593Unsecured
                        notes payable
                    
                    
                    1,323,653Note
                        payable to a bank due April 2006, payable in 60 monthlyinstallments
                        of $512 bearing no interest. The note wascollateralized
                        by transportation equipment and was paid-in-full in 20053,497,676
                    
                    
                    586,446Less:
                        current portion
                    
                    
                    (660,841
                    )
                    
                    45,133Long-term
                        portion
                    
                    $
                    2,836,835
                    
                    $
                    541,313
 The
          Company is in default of a loan agreement with one of its subsidiaries
          as the
          agreement does not allow for a change in ownership without the bank’s
          approval.
 
 NOTE
          K -
          NOTE PAYABLE TO AN INDIVIDUAL
 
 In
          June
          2005, an individual contributed four parcels of land to the Company in
          exchange
          for 200,000 shares of the Company’s common stock and the assumption of a note in
          the amount of $150,000. The note is non-interest bearing and has no specific
          repayment date.
 
 NOTE
          L -
          CAPITAL LEASE OBLIGATION
 
 A
          subsidiary of the Company entered into a sale/leaseback arrangement with
          a bank
          in November 2004 on all of its property and equipment. The arrangement
          was for
          36 monthly payments of $11,141 each including interest at an effective
          rate of
          5.5% with a final payment of $40,500 due November 2007.
  F-21
  HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 NOTE
          L -
          CAPITAL LEASE OBLIGATION (CONTINUED)
 2005
                  
                  
                  2004Total
                      minimum lease payments
                  
                  $
                  285,602
                  
                  $
                  419,294Less:
                      amount representing interest
                  
                  
                  (16,502
                  )
                  
                  34,771Net
                      minimum lease payments
                  
                  
                  269,100
                  
                  
                  384,523Less:
                      current maturities
                  
                  
                  121,934
                  
                  
                  115,423Long-term
                      portion
                  
                  $
                  147,166
                  
                  $
                  269,100
  Minimum
          future lease payments as of December 31, 2005 were as follows:
 Year
                  
                  
                  Amount2006
                  
                  
                  133,6922007
                  
                  
                  151,910Total
                  
                  $
                  285,602
  NOTE
          M -
          PURCHASE COMMITMENTS
 
 Monarch
          Homes has 3 refundable land deposits in VIEs for $221,800. The Company
          is not
          the primary beneficiary as the deposits are refundable. The Company has
          future
          purchase commitments of $2,326,500 related to these deposits.
 
 NOTE
          N -
          RELATED PARTY TRANSACTIONS
 
 Advances
          to Related Party
 
 Evans
          Columbus, LLC, acquired by the Company in December 2005, advanced the former
          owner a net amount of $78,157 to cover operating costs of the manufacturing
          facility owned by the former stockholders and currently leased to Evans
          Columbus, LLC.
 
 Monarch
          Homes, Inc. has a loan to a joint venture partnership in the amount of
          $202,965
          in which Monarch’s former owner has a one third interest. The joint venture was
          created to construct a restaurant.
 
 Obligations
          to Related Parties
 
 In
          connection with the acquisition of Mound Technologies, Inc. in December
          2003,
          the Company assumed a loan of $470,907 payable to the former stockholder
          who
          currently is a significant stockholder of the Company.
 
 In
          connection with the acquisition of Karkela Construction, Inc., the former
          principal stockholder of Karkela declared a $200,000 dividend prior to
          the
          effective date of the acquisition, which was paid in January 2005.
 
 Monarch
          Homes, Inc. sold a home to its President for $135,000.
  F-22
  HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 
 NOTE
          N -
          RELATED PARTY TRANSACTIONS (CONTINUED)
 
 Transactions
          With Related Parties
 
 Compensation
          and consulting fees totaling $503,350 and $86,900 during the years ended
          December 31, 2005 and 2004, respectively, were paid to officers and major
          shareholders from Mundus, and Wyncrest (Consolidated VIEs see Note D).
 
 NOTE
          O
          STOCKHOLDERS’ EQUITY (DEFICIT)
 
 During
          the year 2004, the Company realized that the number of shares issued in
          connection with the reverse merger had to be adjusted. Accordingly, in
          2004,
          703,082 shares were issued to adjust the issuance of the reverse merger
          shares.
 
 During
          the year 2004, the Company issued 1,105,730 shares of its common stock
          to
          individuals for services rendered. The shares were valued at $0.05 per
          share.
          Accordingly, stock based compensation in the amount of $55,287 was
          recorded.
 
 In
          2004,
          the Company settled an outstanding law suit by issuing 170,000 shares of
          its
          common stock valued at $0.05 per share. Accordingly, stock based compensation
          of
          $8,500 was recorded.
 
 During
          the year 2004 at various dates, the Company issued 1,204,396 shares of
          its
          common stock for cash. The shares were issued at various prices ranging
          from
          $0.16 per share to $1.00 per share. The total consideration received aggregated
          $345,000.
 
 During
          2004, the Company acquired three parcels of land having an appraised value
          of
          approximately $600,000 for the issuance of 200,000 shares of its common
          stock
          and the assumption of debt aggregating $150,000. The shares were valued
          at $0.47
          per share.
 
 In
          December 2004, the Company completed three acquisitions. Part of the acquisition
          cost was the issuance of 1,767,000 shares of its common stock valued at
          $0.47
          per share or a consideration of $830,490.
 
 In
          2004,
          the Company settled an outstanding indebtedness of $15,000 by issuing 16,835
          shares of its common stock valued at $0.89 per share.
 
 In
          January 2005, the company approved the issuance of 1,500,000 shares of
          common
          stock to its President and Chief Executive Officer. The shares were valued
          at
          $0.46 per share. Accordingly, stock based compensation in the amount of
          $690,000
          was recorded.
 
 At
          various times during the year, the Company sold 1,696,236 shares of its
          common
          stock under private placement arrangements at prices ranging from $0.50
          to $1.00
          per share.
 
 During
          the year, convertible promissory note holders converted $80,000 of notes
          to
          common stock. The Company issued 100,000 shares of its common stock relating
          to
          the conversion.
 
 In
          June
          2005, the Company settled an old outstanding obligation in the amount of
          $77,190
          for the issuance of 75,000 shares of its common stock.
  F-23
 
 HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 
 NOTE
          O -
          STOCKHOLDERS’ EQUITY (DEFICIT) (CONTINUED)
 
 At
          various times during the year, the Company issued 875,770 shares of its
          common
          stock to individuals for services rendered to the Company and approved
          by the
          Board of Directors. The shares were valued at prices ranging from $0.50
          to $1.00
          per share. Accordingly, stock based compensation in the amount of $651,328
          was
          recorded.
 
 In
          December 2005, the Company issued 783,000 shares of its common stock to
          settle
          the contingent stock issuances relating to the December 2004 acquisitions.
          The
          shares were valued at $0.72 per share. The aggregate consideration was
          $562,250.
 
 At
          various times during the year, the Company issued 467,064 shares of its
          common
          stock to settle legal disputes against the Company. The shares were valued
          at
          $0.50 per share. Accordingly, stock based compensation in the amount of
          $311,657
          was recorded.
 
 The
          Company used 4,153 shares for interest relating to the conversion of its
          convertible promissory notes.
 
 NOTE
          P -
          INCOME TAXES
 
 The
          Company has not elected as at December 31, 2005, to file a consolidated
          Federal
          income tax return. Accordingly, the only carryforward losses available
          to the
          Company are losses incurred in the parent corporation, Heartland, Inc.,
          aggregating approximately $450,000 to offset future tax liabilities of
          the
          parent corporation. This net operating loss expires in 2019.
 
 Temporary
          differences which give rise to deferred taxes are summarized as follows
          for the
          year ended December 31, 2005:
 Timing
                        difference relating to the payment of taxes due todifferences in
                        tax and financial reporting fiscal year ends
                  
                  $
                  408,003Net
                      operating loss and other carry forwards
                  
                  
                  135,000Valuation
                      allowance
                  
                  
                  (135,000
                  )Net
                      deferred tax
                  
                  $
                  408,003
 The
          parent company has recorded a full valuation allowance to reflect the estimated
          amount of deferred tax assets that may not be realized since the generation
          of
          future taxable income is not assured beyond a reasonable doubt.
 
 There
          is
          no difference between the effective income tax rates for deferred income
          taxes
          from the statutory Federal income tax rate.
  F-24
  HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 
 NOTE
          Q -
          OPERATING SEGMENTS
 
 The
          Company presently organizes its business units into three reportable segments:
          steel fabrication, manufacturing and construction, and property management.
          The
          steel fabrication segment focuses on the fabrication of metal products.
          The
          manufacturing segment manufactures steel drums and also manufactures products
          for the heavy machinery industry. The construction and property management
          segment builds custom residential homes in the State of Minnesota and functions
          as a general contractor in the greater St. Paul and Minneapolis, Minnesota
          area.
          It also owns and manages industrial property in Ohio.
 
 The
          Company’s reportable business segments are strategic business units that offer
          different products and services. Each segment is managed separately because
          they
          require different technologies and market to different classes of
          customers.
 Reportable
                      SegmentsYear
                      ended December 31, 2005:
                  
                  
                  Parent
                      Company
                  
                  
                  SteelFabrication
                  
                  
                  Manufacturing
                  
                  
                  Construction
                          and Property Management
                  
                  
                  TotalREVENUES
                      (there are no inter-segment revenues)
                  
                  
                  
                  
                  $
                  7,764,997
                  
                  $
                  9,384,192
                  
                  $
                  23,525,525
                  
                  $
                  40,674,714NET
                      INCOME (LOSS)
                  
                  $
                  (5,095,008
                  )
                  
                  682,977
                  
                  
                  177,778
                  
                  
                  (376,252
                  )
                  
                  (4,610,505
                  )TOTAL
                      ASSETS
                  
                  
                  11,604,362
                  
                  
                  3,486,987
                  
                  
                  2,362,399
                  
                  
                  11,835,415
                  
                  
                  29,289,163OTHER
                      SIGNIFICANT ITEMSDepreciation
                      expense
                  
                  
                  
                  
                  
                  23,738
                  
                  
                  93,662
                  
                  
                  63,575
                  
                  
                  180,975Interest
                      expense
                  
                  
                  722,395
                  
                  
                  40,460
                  
                  
                  67,999
                  
                  
                  27,913
                  
                  
                  858,767Expenditures
                      for assets
  Reportable
                    SegmentsYear
                    ended December 31, 2004:
                
                
                Parent
                    Company
                
                
                SteelFabrication
                
                
                Manufacturing
                
                
                Construction
                          and Property Management
                
                
                TotalREVENUES
                    (there are no inter-segment revenues)
                
                
                
                
                $
                7,389,064
                
                
                
                
                
                
                
                $
                7,389,064NET
                    INCOME (LOSS)
                
                $
                (476,129
                )
                
                72,460
                
                
                
                
                
                
                
                
                (403,669
                )TOTAL
                    ASSETS
                
                
                380,594
                
                
                2,646,848
                
                
                
                
                
                
                
                
                3,027,442OTHER
                    SIGNIFICANT ITEMSDepreciation
                    expense
                
                
                
                
                
                21,729
                
                
                
                
                
                
                
                
                21,729Interest
                    expense
                
                
                18,886
                
                
                5,256
                
                
                
                
                
                
                
                
                24,142Expenditures
                    for assets
                
                
                
                
                
                56,776
                
                
                
                
                
                
                
                
                56,776
 NOTE
          R -
          COMMITMENTS AND CONTINGENCIES
 
 In
          June
          of 2004, an individual, in an exchange for 200,000 shares of the Company’s stock
          and the assumption of a note for $150,000, transferred four parcels of
          land to
          the Company with an appraised value of $600,000. (See Note K) One of the
          parcels
          was given as collateral to the Internal Revenue Service for unpaid payroll
          taxes
          relating to the Mound Technologies acquisition in 2003.
 
 A
          subsidiary of the Company leases its manufacturing facility from a related
          party. The lease calls for monthly lease payments of $20,000 and expires
          on
          September 30, 2007. Renewal options are for four terms of five years each.
          The
          subsidiary has guaranteed the related party’s obligation under its mortgage
          obligation on the facility. Management believes that the value of the premises
          pledged as collateral for the guaranteed obligation are in excess of any
          future
          amount of the payments that may be required pursuant to the terms of the
          guarantee. Minimum future lease payments under the lease are as
          follows:
  F-25
   HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 NOTE
          R -
          COMMITMENTS AND CONTINGENCIES (CONTINUED)
 For
                    the Years
                    EndingDecember
                    31,
                  
                  
                  Amount2006
                  
                  $
                  27,1362007
                  
                  
                  27,6482008
                  
                  
                  28,1602009
                  
                  
                  28,672Total
                  
                  $
                  111,616
 
 Three
          of
          the facilities are rented on a month to month basis from stockholders of
          the
          Company. Rent
          expense amounted to $280,082 and $522,782 for the years ended December
          31, 2005
          and 2004, respectively.
 
 The
          Company is obligated under the terms of a lease dated February 25, 2005
          with the
          Receivership of Mound Properties, LP in Springboro, Ohio owned by a related
          party on behalf of Mound for a month to month term beginning January 2005
          at a
          monthly rent of $16,250. Each party has the right to terminate this lease
          with
          30 days notice. Under the terms of the lease, the Company is responsible
          for
          utilities, personal property taxes, and repairs and maintenance.
 
 The
          Company is also obligated under the terms of a five year lease terminating
          December 31, 2009 in Plymouth, Minnesota for annual rents of $26,624, $27,136,
          $27,648, $28,160 and $28,672, respectively. Under the terms of the lease
          the
          Company is responsible for a pro rata share of real estate taxes and operating
          expenses as additional rental.
 
 As
          indicated in Note C - Acquisitions, the Company is liable for interest
          and
          promissory notes if not paid by due dates and additional shares of stock
          if the
          common stock of the Company is not trading at minimum share prices in the
          future.
 
 NOTE
          S -
          RESTATEMENT - 2004
 
 The
          financial statements for 2004 have been restated in order to account for
          the
          issuance of 1,256,000 shares of common stock in exchange for all the issued
          and
          outstanding shares of Mound as a capital transaction equivalent to the
          issuance
          of stock by Mound for the net monetary assets of the Company accompanied
          by a
          recapitalization. Accordingly no goodwill was recorded and the accumulated
          deficit of the Company after the transaction is equal to the accumulated
          deficit
          of Mound. The accumulated deficit of the Company at the date of acquisition
          was
          eliminated with an offsetting entry to additional paid-in capital.
 
 The
          consolidated statement of operations for the year ended December 31, 2004
          has
          been restated to eliminate sales and expenses for the three acquisitions
          referred to in Note C showing instead this information separately in Note
          C.
  F-26
 
 
 HEARTLAND,
          INC. AND SUBSIDIARIES
 (Formerly
          International Wireless, Inc.)
 
 NOTES
          TO
          CONSOLIDATED FINANCIAL STATEMENTS
 December
          31, 2005
 
 
 NOTE
          S -
          RESTATEMENT - 2004 (CONTINUED)
 
 The
          Balance Sheet at December 31, 2005 has been restated to reflect the additional
          contingent shares that would be required to be issued at December 31, 2005
          should the shares issued at December 31, 2005 not reach minimum trading
          values
          at that date. (See Note C). The effect of this was to increase paid-in
          capital
          and goodwill by $7,504,510 at December 31, 2004.
 
 NOTE
          T -
          SUBSEQUENT EVENTS
 
 On
          March
          15, 2006, Mundus Environmental Products, Inc. (“Mundus”), a consolidated VIE
          (“Twin Hills”) (See Note D) entered into an agreement to acquire Twin Hills
          Acquisitions and Twin Hills Collectibles, companies engaged in the business
          of
          NASCAR Collectibles, in exchange for 1,333,000 newly issued shares of Mundus
          and
          a non-interest bearing promissory note for $75,000 payable within two years.
          If
          the common stock of Mundus is not selling for at least $2.50, 30 days prior
          to
          the expiration of the two year period, the Company is required to repurchase
          up
          to 100% of 1,000,000 of the shares. At January 31, 2006 Twin Hills had
          current
          assets of $1,708,031, total assets of $2,028,849, current liabilities of
          $1,863,770, total liabilities of $1,866,327 and retained earnings of $296,616.
          Unaudited operating results for the year ended January 31, 2006 reflected
          a loss
          of $233,698.
 
 At
          May
          19, 2006, Ron Evans, former owner of Evans Columbus, LLC has advised the
          Company
          he intends to rescind the original agreement because the Company has not
          fulfilled its contractual obligations. This matter is presently under
          negotiation.
  F-27







23


**ITEM
      8.**  **CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE**




None.




**Item
                8A.****Controls
                and Procedures**




Management
      of the Company is responsible for establishing and maintaining adequate internal
      control over financial reporting and for the assessment of the effectiveness
      of
      internal controls over financial reporting. The Company's internal control
      system over financial reporting is a process designed under the supervision
      of
      the Company's chief executive officer and chief financial officer to provide
      reasonable assurance regarding the reliability of financial reporting and the
      preparation of the consolidated financial statements in accordance with U.S.
      generally accepted accounting principles.




All
      internal control systems, no matter how well designed, have inherent
      limitations. Therefore, even those systems determined to be effective can
      provide only reasonable assurance with respect to financial statement
      preparation and presentation. Also, projections of any evaluation of
      effectiveness to future periods are subject to the risk that controls may become
      inadequate because of changes in conditions.




As
      of the
      end of the period covered by this report, we carried out an evaluation of the
      effectiveness of the design and operation of our disclosure controls and
      procedures pursuant to Exchange Act Rule 13a-15. This evaluation was done under
      the supervision and with the participation of our principal executive officer
      and principal financial officer. Based on their evaluation of our disclosure
      controls and procedures (as defined in the Exchange Act Rule 13a-15e), our
      principal executive officer and principal financial officer have concluded
      that
      during the period covered by this report, such disclosure controls and
      procedures were not effective to detect the inappropriate application of US
      GAAP
      rules as more fully described below. This was due to deficiencies that existed
      in the design or operation of our internal control over financial reporting
      that
      adversely affected our disclosure controls and that may be considered to be
      "material weaknesses." The Public Company Accounting Oversight Board has defined
      a material weakness as a "significant deficiency or combination of significant
      deficiencies that results in more than a remote likelihood that a material
      misstatement of the annual or interim financial statements will not be prevented
      or detected."




We
      identified deficiencies in our internal controls and disclosure controls related
      to the accounting of our acquisitions.




As
      a
      result of the identification of the misapplication of US GAAP rules, our
      management has concluded that, as of December 31, 2005, our internal control
      over financial reporting was not effective.




Remediation
      of Material Weaknesses




We
      have
      formulated a program to remedy the material weaknesses identified above. In
      the
      first phase of the program, to be implemented during the second and third
      quarters of 2006, we intend to hire a Chief Financial Officer, a Controller
      and
      a Senior Accountant to augment our accounting, financial reporting and financial
      control function in our finance department.





In
      the
      second phase of the program, we expect to increase our auditor's review work
      quarterly, as well as, increase the areas reviewed and discussed with the audit
      committee and auditors beforehand, on any changes in accounting principles
      or
      revenue or expense recognition.




Changes
      in Internal Control Over Financial Reporting




Except
      as
      set forth above, there have been no changes in our internal control over
      financial reporting that occurred during the year ended December 31, 2005 that
      have materially affected, or are reasonably likely to materially affect, our
      internal control over financial reporting.




**Item
                8B.****Other
                Information**




None.




24


**PART
      III**




**ITEM
                9.****DIRECTORS,
                EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS: COMPLIANCE WITH
                SECTION
                16(A) OF THE EXCHANGE ACT**




The
      directors and officers of our Company and its subsidiaries, as of October 12,
      2005, are set forth below. The directors hold office for their respective term
      and until their successors are duly elected and qualified. Vacancies in the
      existing Board are filled by a majority vote of the remaining directors. The
      officers serve at the will of the Board of Directors.




**Name**
            
            **Age**
            
            **With
                Company**
              **Since**
            
            **Director/Position**Trent
                Sommerville
            
            39
            
            12/2003
            
            Chief
                Executive Officer,
              Chairman
                of the Board,
              and
                DirectorJerry
                Gruenbaum
            
            51
            
            01/2001
            
            Secretary,
                General Counsel
              and
                DirectorKenneth
                B. Farris
            
            46
            
            01/2004
            
            Director






**MR.
      TRENT SOMMERVILLE - CHIEF EXECUTIVE OFFICER AND CHAIRMAN OF THE
      BOARD**




Mr.
      Sommerville was elected as Director, Chairman of the Board and appointed as
      our
      Chief Executive Officer in December 1, 2003. Mr. Sommerville attended
      Perkingston College. Mr. Sommerville worked at Anjet where he obtained NASD
      Series 22 and Series 63 licenses. Following his experience there, Mr.
      Sommerville started IGE Capital where he has been actively involved in many
      venture capital opportunities including FYBX Corporation, Cyber Operations,
      Way
      Cool 3D, and PMI Wireless.




**JERRY
      GRUENBAUM - CORPRATE SECRETARY, GENERAL COUNSEL AND
      DIRECTOR**




Mr.
      Gruenbaum is our Corporate Secretary, General Counsel, and member of our Board
      of Directors. He was appointed as our Corporate Secretary and General Counsel
      in
      December 2001 and was elected to our board on November 12, 2003. He has been
      admitted to practice law since 1979 and is a licensed attorney in various states
      including the State of Connecticut where he maintains his practice as a member
      of SEC Attorneys, LLC, specializing in Securities Law, Mergers and Acquisitions,
      Corporate Law, Tax Law, International Law and Franchise Law. He is the CEO
      of a
      licensed brokerage firm in Westport, Connecticut where he maintains a Series
      7,
      24, 27 63 and 65 licenses. He is a former President and Chairman of the Board
      of
      Directors of a multinational publicly-traded company with operations in Hong
      Kong and the Netherlands. He previously worked for the tax departments for
      Peat
      Marwick Mitchell & Co. (now KPMG Peat Marwick LLP) and Arthur Anderson &
Co. He has served as Compliance Director for CIGNA Securities, a division of
      CIGNA Insurance. He has lectured and taught at various Universities throughout
      the United States in the areas of Industrial and financial Accounting, taxation,
      business law, and investments. Attorney Gruenbaum graduated with a B.S. degree
      from Brooklyn College - C.U.N.Y. Brooklyn, New York; has a M.S. degree in
      Accounting from Northeastern University Graduate School of Professional
      Accounting, Boston, Massachusetts; has a J.D. degree from Western New England
      College School of Law, Springfield, Massachusetts; and an LL.M. in Tax Law
      from
      the University of Miami School of Law, Coral Gables, Florida.





25


**DR.
      KENNETH B. FARRIS - DIRECTOR**




Dr.
      Farris was appointed a director of our Company on January 8, 2004. Dr. Farris,
      a
      resident of New Orleans, Louisiana is a graduate of Tulane University’s School
      of Medicine where he received his MD and MPH degrees in1975. He is a graduate
      of
      Carnegie-Mellon University where he received his BS degree in 1971.
      Dr. Farris is board certified in Pathology. He has been teaching at Tulane
      University School of Medicine since 1975 where he has received numerous awards
      for outstanding teaching. Since 1991 he has held the position of Clinical
      Associate Professor, Department of Pathology and Clinical Associate Professor
      Department of Pediatrics. In addition, Dr Ferris holds the position of Director
      of Pathology at West Jefferson Medical Center in Marrero, Louisiana, and Medical
      Director, Laboratory at Pendleton Memorial Methodist Hospital. Dr. Farris is
      a
      member of various medical societies and has published extensively. Among his
      many accomplishments in his field, as of 1982 he holds the position of
      Laboratory Accreditation Program Inspector for the College of American
      Pathologists. He is a founding member and past President of the Greater New
      Orleans Pathology Society. He is currently a Delegate to the House of Delegates
      to the American Medical Association. He has held various positions including
      past President, Speaker to the House of Delegates, member of the Board of
      Governors and a current Delegate to the House of Delegates to the Louisiana
      State Medical Society. He has held the position of President, Vice President,
      Secretary and Treasurer for the Tulane Medical Alumni Association. He is a
      former Drug Control Crew Chief to the United States Olympic
      Committee.




Our
      bylaws currently provide for a board of directors comprised of such number
      as is
      determined by the Board.




**FAMILY
      RELATIONSHIPS**




None.




**BOARD
      COMMITTEES**




We
      currently have no compensation committee, audit committee or other board
      committee performing equivalent functions. Currently, all members of our board
      of directors participate in all discussions concerning the company.




**LEGAL
      PROCEEDINGS**




No
      officer, director, or persons nominated for such positions, promoter or
      significant employee has been involved in legal proceedings that would be
      material to an evaluation of our management.





**Compliance
      with Section 16(a) of the Exchange Act**




Section
      16(a) of the Securities Exchange Act of 1934 requires our directors and
      executive officers, and persons who own more then 10 percent of our Common
      Stock, to file with the SEC the initial reports of ownership and reports of
      changes in ownership of common stock. Officers, directors and greater than
      10
      percent stockholders are required by SEC regulation to furnish us with copies
      of
      all Section 16(a) forms they file.




Specific
      due dates for such reports have been established by the Commission and we are
      required to disclose any failure to file reports. Except as otherwise set forth
      herein, based solely on review of the copies of such forms furnished to us,
      or
      written representations that no reports were required, we believe that to date
      all required forms have been filed, and that there was no failure to comply
      with
      Section 16(a) filing requirements applicable to our officers, directors and
      ten
      percent stockholders.





**CODE
      OF ETHICS**





Because
      we are an early stage company with limited resources, we have not yet adopted
      a
      "code of ethics", as defined by the SEC, that applies to the Company's Chief
      Executive Officer, Chief Financial Officer, principal accounting officer or
      controller and persons performing similar functions. We are in the process
      of
      drafting and adopting a Code of Ethics




26


**ITEM
                10.****EXECUTIVE
                COMPENSATION**





The
      following table provides summary information for the years 2003, 2004 and 2005
      concerning cash and noncash compensation paid or accrued by us to or on behalf
      of the president and the only other employee(s) to receive compensation in
      excess of $100,000.




**SUMMARY
      COMPENSATION TABLE**




**Name/
                Position**
            
            **Year**
            
            **Salary**
            
            **Bonus**
            
            **Stock**
            
            **Other**
            
            **Total**Trent
                Sommerville
            
            
            2005
            
            $
            205,000
            
            $
            0
            
            $
            690,000
            
            $
            0
            
            $
            895,000Chairman
                and CEO
            
            
            2004
            
            $
            164,976
            
            $
            0
            
            $
            0
            
            $
            0
            
            $
            164,9762003
            
            $
            0
            
            $
            0
            
            $
            0
            
            $
            0
            
            $
            0Jerry
                Gruenbaum
            
            
            2005
            
            $
            25,000
            
            $
            0
            
            
            
            
            $
            $0
            
            $
            25,000Secretary,
                General Counsel
            
            
            2004
            
            $
            109,500
            
            $
            0
            
            $
            25,000
            
            $
            0
            
            $
            134,5002003
            
            $
            0
            
            $
            0
            
            $
            0
            
            $
            0
            
            $
            0







**COMPENSATION
      AGREEMENTS**




The
      Company has no employment agreement with employees and officers of the company
      as of this date.




No
      other
      annual compensation, including a bonus or other form of compensation; and no
      long-term compensation, including restricted stock awards, securities underlying
      options, LTIP payouts, or other form of compensation, were paid to these
      individuals during this period.




**BOARD
      COMPENSATION**




Members
      of our Board of Directors do not receive cash compensation for their services
      as
      Directors, although some Directors are reimbursed for reasonable expenses
      incurred in attending Board or committee meetings. All corporate actions are
      conducted by unanimous written consent of the Board of Directors.




**STOCK
      OPTION PLAN**




The
      Company has no Stock Option Plan as of this date.




**WARRANTS**




The
      Company has no Warrants outstanding as of this date.




**ITEM
                11.****SECURITY
                OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
                MANAGEMENT**





The
      following table sets forth as of October 12, 2005, information with respect
      to
      the beneficial ownership of the Company’s Common Stock by (i) each person known
      by the Company to own beneficially 5% or more of such stock, (ii) each Director
      of the Company who owns any Common Stock, and (iii) all Directors and Officers
      as a group, together with their percentage of beneficial holdings of the
      outstanding shares.




The
      information presented below regarding beneficial ownership of our voting
      securities has been presented in accordance with the rules of the Securities
      and
      Exchange Commission and is not necessarily indicative of ownership for any
      other
      purpose. Under these rules, a person is deemed to be a "beneficial owner" of
      a
      security if that person has or shares the power to vote or direct the voting
      of
      the security or the power to dispose or direct the disposition of the security.
      A person is deemed to own beneficially any security as to which such person has
      the right to acquire sole or shared voting or investment power within 60 days
      through the conversion or exercise of any convertible security, warrant, option
      or other right. More than one person may be deemed to be a beneficial owner
      of
      the same securities. The percentage of beneficial ownership by any person as
      of
      a particular date is calculated by dividing the number of shares beneficially
      owned by such person, which includes the number of shares as to which such
      person has the right to acquire voting or investment power within 60 days,
      by
      the sum of the number of shares outstanding as of such date plus the number
      of
      shares as to which such person has the right to acquire voting or investment
      power within 60 days. Consequently, the denominator used for calculating such
      percentage may be different for each beneficial owner. Except as otherwise
      indicated below and under applicable community property laws, we believe that
      the beneficial owners of our common stock listed below have sole voting and
      investment power with respect to the shares shown.




27


**SECURITY
      OWNERSHIP OF BENEFICIAL OWNERS** (1):




**Title
                of Class**
            
            **Name**
            
            **Shares**
            
            **Percent**Common
                Stock
            
            The
                Good One Inc.
            
            1,700,000
            (2)
            6.77
            %Lavonne
                Adams
            
            1,155,000
            
            4.60
            %John
                Zavoral
            
            1,125,000
            
            4.48
            %First
                Union Venture Group, LLC
            
            1,500,000
            (3)
            5.97
            %




**SECURITY
      OWNERSHIP OF MANAGEMENT** :




**Title
                of Class**
            
            **Name**
            
            **Shares**
            
            **Percent**Common
                Stock
            
            Trent
                Sommerville
            
            4,500,100
            
            17.91
            %Jerry
                Gruenbaum
            
            1,000,000
            (4)
            3.98
            %Kenneth
                B. Farris
            
            50,000
            
            0.20
            %Thomas
                Miller
            
            1,200,000
            
            4.78
            %All
                Directors and Executive Officers as a group (4 persons)
            
            6,750,100
            
            26.86
            %







(1)
            These
                tables are based upon 25,128,858 shares outstanding as of May 17,
                2006 and
                information derived from our stock records. Unless otherwise indicated
                in
                the footnotes to these tables and subject to community property laws
                where
                applicable, we believes unless otherwise noted that each of the
                shareholders named in this table has sole or shared voting and investment
                power with respect to the shares indicated as beneficially owned.
                For
                purposes of this table, a person or group of persons is deemed to
                have
                "beneficial ownership" of any shares which such person has the right
                to
                acquire within 60 days as of October 12, 2005. For purposes of computing
                the percentage of outstanding shares held by each person or group
                of
                persons named above on October 12, 2005 any security which such person
                or
                group of persons has the right to acquire within 60 days after such
                date
                is deemed to be outstanding for the purpose of computing the percentage
                ownership for such person or persons, but is not deemed to be outstanding
                for the purpose of computing the percentage ownership of any other
                person.




(2)
            The
                Good One, Inc. owns 1,500,000 directly and 200,000 indirectly through
                its
                sole shareholder June Stevens.




(3)
            First
                Union Venture Group, LLC is owned one half by Atty. Jerry Gruenbaum,
                Secretary, General Counsel and Director of the Company and one half
                by
                another individual who is not related to Atty. Gruenbaum or under
                his
                control. In addition Jerry Gruenbaum owns 500,000 shares in his own
                name.




28


(4)
            Jerry
                Gruenbaum holds 500,000 shares as a result of a 50% interest in First
                Union Venture Group, LLC. and 500,000 directly in his own
                name.





**ITEM
                12.****CERTAIN
                RELATIONSHIPS AND RELATED
                TRANSACTIONS.**





No
      director, executive officer or nominee for election as a director of our
      company, and no owner of five percent or more of our outstanding shares or
      any
      member of their immediate family has entered into or proposed any transaction
      in
      which the amount involved exceeds $60,000 except as set forth
      below.




Our
      management is involved in other business activities and may, in the future
      become involved in other business opportunities. If a specific business
      opportunity becomes available, such persons may face a conflict in selecting
      between our business and their other business interests. We have not and do
      not
      intend in the future to formulate a policy for the resolution of such
      conflicts.




In
      Springboro, Ohio we lease approximately 39,000 square feet on a month to month
      lease for $8,500 per month from a major shareholder of our company. The
      facilities include 34,000 square feet which is used for manufacturing and 5,000
      square feet for office space. The space is used by Mound.




In
      Columbus, Ohio we lease approximately 70,000 square feet on a five (5) year
      term
      from January 1, 2002 through December 31, 2007 for $20,000 per month from Par
      Investments, a company related to the president of Evans. The facilities include
      approximately 67,000 square feet for manufacturing and 3,000 square feet for
      offices. The space is used by Evans.




In
      Ramsey, Minnesota we lease approximately 3,000 square feet on a month to month
      lease for $7,000 per month from Brad Fritch, the President of Monarch. The
      facilities include approximately 1,800 square feet of office space and 1,200
      square feet for storage. The space is used by Monarch.




In
      St.
      Louis Park, Minnesota we lease approximately 6,975 square feet on a 63 month
      lease beginning January 1, 2005. The facilities are used as offices for our
      Karkela employees. The lessor is Larry Karkela, the President of the Karkela
      subsidiary. The lease required an initial security deposit of $5,356. We pay
      our
      proportionate share of utilities and real estate tax based upon our percentage
      of occupancy which is 60.1%.




**ITEM
                13.  EXHIBITS AND
                REPORTS ON FORM 8-K**





**Exhibit
                Number**
            **Document
                Description**




3.1
            Certificate
                of Incorporation of Origin Investment Group, Inc. as filed with the
                Maryland Secretary of State on April 6, 1999, incorporated by reference
                to
                the Company’s Registration Statement on Form 10-KSB filed with the
                Securities and Exchange Commission on August 16,
                1999.




3.2
            Amended
                Certificate of Incorporation of International Wireless, Inc. as filed
                with
                the Maryland Secretary of State on June 12, 2003, incorporated by
                reference to the Company’s Current Report on Form 8-K filed with the
                Securities and Exchange Commission on June 12,
                2003.




3.3
            Amended
                Certificate of Incorporation of International Wireless, Inc. to change
                name to Heartland, Inc. as filed with the Maryland Secretary of State
                on
                June 12, 2003, incorporated by reference to the Company’s Current Report
                on Form 8-K filed with the Securities and Exchange Commission on
                June 15,
                2004.




3.4
            Bylaws
                of Origin Investment Group, Inc., incorporated by reference to the
                Company’s Registration Statement on Form 10-SB filed with the Securities
                and Exchange Commission on August 16,
                1999.




29


10.1
            Acquisition
                Agreement between Evans Columbus, LLS (“Evans”) and Heartland to acquire
                Evans dated December 30, 2004, incorporated by reference to the Company’s
                Current Report on Form 8-K filed with the Securities and Exchange
                Commission on January 4, 2005.




10.2
            Acquisition
                Agreement between Karkela Construction, Inc. (“Karkela”) and Heartland to
                acquire Karkela dated December 31, 2004, incorporated by reference
                to the
                Company’s Current Report on Form 8-K filed with the Securities and
                Exchange Commission on January 6,
                2005.




10.3
            Acquisition
                Agreement between Monarch Homes, Inc. (“Monarch”) and Heartland to acquire
                Monarch dated December 30, 2004, incorporated by reference to the
                Company’s Current Report on Form 8-K filed with the Securities and
                Exchange Commission on January 4,
                2005.




10.4
            Acquisition
                Agreement between Persinger’s Equipment, Inc. (“Persinger”) and Heartland
                to acquire Persinger dated July 14, 2005, incorporated by reference
                to the
                Company’s Current Report on Form 8-K filed with the Securities and
                Exchange Commission on August 3,
                2005.




10.5
            Acquisition
                Agreement between Lee Oil Company, Inc. (“Lee Oil”) and Heartland to
                acquire Lee Oil dated August 3, 2005, incorporated by reference to
                the
                Company’s Current Report on Form 8-K filed with the Securities and
                Exchange Commission on September 22,
                2005.




10.6
            Acquisition
                Agreement between Ney Oil Company (“Ney Oil”) and Heartland to acquire
                Persinger dated September 12, 2005, incorporated by reference to
                the
                Company’s Current Report on Form 8-K filed with the Securities and
                Exchange Commission on September 22,
                2005.




10.7
            Acquisition
                Agreement between Shultz Oil Company, Inc. (“Schultz”) and Heartland to
                acquire Schultz dated September 21, 2005, incorporated by reference
                to the
                Company’s Current Report on Form 8-K filed with the Securities and
                Exchange Commission on September 27,
                2005.




10.8
            Letter
                of Intent between NKR, Inc. d.b.a. Ohio Valley Lumber (“Ohio Valley
                Lumber”) and Heartland to acquire Ohio Valley Lumber dated September 12,
                2005, incorporated by reference to the Company’s Current Report on Form
                8-K filed with the Securities and Exchange Commission on September
                27,
                2005.




31.1
            Certification
                of Chief Executive Officer and the Principal Financial Officer pursuant
                to
                Section 302 of the Sarbanes Oxley
                Act.






32.1
            Certification
                of Chief Executive Officer and the Principal Financial Officer Pursuant
                to
                18 U.S.C. Section 1350 as adopted Pursuant to Section 906 of the
                Sarbanes
                Oxley Act of 2002.







**ITEM
                14.****PRINCIPAL
                ACCOUNTANT FEES AND
                SERVICES**




The
      following table sets forth fees billed to us by our auditors during the fiscal
      years ended December 31, 2004 and December 31, 2003 for: (i) services rendered
      for the audit of our annual financial statements and the review of our quarterly
      financial statements, (ii) services by our auditor that are reasonably related
      to the performance of the audit or review of our financial statements and that
      are not reported as Audit Fees, (iii) services rendered in connection with
      tax
      compliance, tax advice and tax planning, and (iv) all other fees for services
      rendered.




30


(i)
      Audit
      Fees




FIRM
            
            FISCAL
                YEAR 2005
            
            FISCAL
                YEAR 2004Meyler
                & Company, LLC
            
            $190,000
            
            $
                100,000




(ii)
      Audit Related Fees




None




(iii)
      Tax
      Fees




None





(iv)
      All
      Other Fees




None




**TOTAL
      FEES**




FIRM
            
            FISCAL
                YEAR 2005
            
            FISCAL
                YEAR 2004Meyler
                & Company, LLC
            
            $190,000
            
            $
                100,000






AUDITFEES.
            Consists
                of fees billed for professional services rendered for the audit of
                our
                consolidated financial statements and review of the interim consolidated
                financial statements included in quarterly reports and services that
                are
                normally provided in connection with statutory and regulatory filings
                or
                engagements.




AUDIT-RELATED
                FEES.
            Consists
                of fees billed for assurance and related services that are reasonably
                related to the performance of the audit or review of our consolidated
                financial statements and are not reported under “Audit Fees.” There were
                no Audit-Related services provided in fiscal 2004 or
                2003.




TAX
                FEES.
            Consists
                of fees billed for professional services for tax compliance, tax
                advice
                and tax planning.




ALL
                OTHER FEES.
            Consists
                of fees for products and services other than the services reported
                above.




**POLICY
      ON AUDIT COMMITTEE PRE-APPROVAL OF AUDIT AND PERMISSIBLE NON-AUDIT SERVICES
      OF
      INDEPENDENT AUDITORS**




The
      Company currently does not have a designated Audit Committee, and accordingly,
      the Company’s Board of Directors’ policy is to pre-approve all audit and
      permissible non-audit services provided by the independent auditors. These
      services may include audit services, audit-related services, and tax services
      and other services. Pre-approval is generally provided for up to one year and
      any pre-approval is detailed as to the particular service or category of
      services and is generally subject to a specific budget. The independent auditors
      and management are required to periodically report to the Company’s Board of
      Directors regarding the extent of services provided by the independent auditors
      in accordance with this pre-approval, and the fees for the services performed
      to
      date. The Board of Directors may also pre-approve particular services on a
      case-by-case basis.


31


**SIGNATURES**




In
      accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
      this report to be signed on its behalf by the undersigned, there unto duly
      authorized.












**HEARTLAND INC.**
              (Registrant)Date:
                May 19, 2006
            By:/s/Trent
                SommervilleTrent
                Sommerville
              Chief
                Executive Officer, Principal
              Financial
                Officer and
              Chairman
                of the Board




Date:
                May 19, 2006
            By:/s/Jerry Gruenbaum, Esq.Jerry
              Gruenbaum, Esq.
              Secretary
                and Director




Date:
                May 19, 2006
            By:/s/Dr. Kenneth B. FarrisDr.
                Kenneth B. Farris
              Director






In
      accordance with the Exchange Act, this report has been signed below by the
      following persons on behalf of the registrant and in the capacities and on
      the
      dates indicated.






**SIGNATURE**
            
            **NAME**
            
            **TITLE**
            
            **DATE**/s/Trent
                Sommerville
            
            Trent
                Sommerville
            
            CEO,
                Principal Financial Officer & Chairman of the Board
            
            May
                19, 2006/s/Jerry Gruenbaum
            
            Jerry
                Gruenbaum
            
            Secretary
                & Director
            
            May
                19, 2006/s/Kenneth B. Farris
            
            Kenneth
                B. Farris
            
            Director
            
            May
                19, 2006






32