Document:

EX-10.2

Exhibit 10.2

 

AGREEMENT AND PLAN OF MERGER

by and among

Energy West, Incorporated

Various Acquisition Subsidiaries

and

Lightning Pipeline Co., Inc.

Great Plains Natural Gas Company

Brainard Gas Corp.

and

Richard M. Osborne, Trustee

Rebecca Howell

Stephen G. Rigo

Marty Whelan

Thomas J. Smith

Dated as of June 29, 2009

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 
	1.	 	DEFINITIONS	 	 	2	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	1.1.	 	Defined Terms	 	 	2	 
	 
	 	 	 	1.2.	 	Construction of Certain Terms and Phrases	 	 	10	 
	 
	 	 	 	 	 	 	 	 	 	 
	2.	 	THE MERGERS	 	 	10	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	2.1.	 	The Mergers	 	 	11	 
	 
	 	 	 	2.2.	 	The Closing	 	 	11	 
	 
	 	 	 	2.3.	 	Effective Time	 	 	11	 
	 
	 	 	 	2.4.	 	Effects of Mergers	 	 	12	 
	 
	 	 	 	2.5.	 	Articles of Incorporation of each Surviving Corporation	 	 	12	 
	 
	 	 	 	2.6.	 	Code of Regulations of each Surviving Corporation	 	 	12	 
	 
	 	 	 	2.7.	 	Directors and Officers of each Surviving Corporation	 	 	12	 
	 
	 	 	 	2.8.	 	Effect on Capital Stock	 	 	12	 
	 
	 	 	 	2.9.	 	Change in Shares	 	 	13	 
	 
	 	 	 	2.10.	 	Exchange Procedures	 	 	13	 
	 
	 	 	 	2.11.	 	No Further Ownership Rights or Claims Relating to Company Common Stock	 	 	14	 
	 
	 	 	 	2.12.	 	No Fractional Shares of Parent Common Stock	 	 	14	 
	 
	 	 	 	2.13.	 	Lost Certificates	 	 	14	 
	 
	 	 	 	2.14.	 	Withholding Rights	 	 	14	 
	 
	 	 	 	2.15.	 	Further Assurances	 	 	15	 
	 
	 	 	 	2.16.	 	Stock Transfer Books	 	 	14	 
	 
	 	 	 	 	 	 	 	 	 	 
	3.	 	PRE-CLOSING COVENANTS AND UNDERTAKINGS	 	 	15	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	3.1.	 	Satisfaction of Closing Conditions	 	 	15	 
	 
	 	 	 	3.2.	 	Conduct of the Business of the Companies and Subsidiaries Prior to Closing	 	 	15	 
	 
	 	 	 	3.3.	 	Consents and Approvals	 	 	17	 
	 
	 	 	 	3.4.	 	Access, Information and Confidentiality	 	 	19	 
	 
	 	 	 	3.5.	 	Delivery of Financial Statements and Regulatory Filings	 	 	20	 
	 
	 	 	 	3.6.	 	Public Announcements	 	 	20	 
	 
	 	 	 	 	 	 	 	 	 	 
	4.	 	ADDITIONAL AGREEMENTS	 	 	20	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	4.1.	 	Tax Matters	 	 	20	 
	 
	 	 	 	4.2.	 	Employee and Benefit Matters	 	 	23	 
	 
	 	 	 	4.3.	 	Guaranties or Bonds	 	 	24	 
	 
	 	 	 	4.4.	 	Agreement Not to Solicit Employees	 	 	24	 
	 
	 	 	 	4.5.	 	Insurance Claims	 	 	24	 
	 
	 	 	 	 	 	 	 	 	 	 
	5.	 	REPRESENTATIONS AND WARRANTIES OF RMO REGARDING THE COMPANIES AND SUBSIDIARIES	 	 	25	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	5.1.	 	Organization and Good Standing of the Companies and Subsidiaries; Foreign Qualifications	 	 	25	 

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	 	 	 	5.2.	 	Capitalization of the Companies and Subsidiaries	 	 	25	 
	 
	 	 	 	5.3.	 	Financial Statements; Undisclosed Liabilities	 	 	26	 
	 
	 	 	 	5.4.	 	Taxes	 	 	26	 
	 
	 	 	 	5.5.	 	Tangible Personal Property	 	 	27	 
	 
	 	 	 	5.6.	 	Agreement Related to Other Instruments; Consents	 	 	27	 
	 
	 	 	 	5.7.	 	Absence of Changes	 	 	27	 
	 
	 	 	 	5.8.	 	Material Claims	 	 	28	 
	 
	 	 	 	5.9.	 	Permits; Compliance With Laws	 	 	29	 
	 
	 	 	 	5.10.	 	Real Property	 	 	29	 
	 
	 	 	 	5.11.	 	Intellectual Property; Software	 	 	30	 
	 
	 	 	 	5.12.	 	Material Contracts	 	 	31	 
	 
	 	 	 	5.13.	 	Labor Matters	 	 	33	 
	 
	 	 	 	5.14.	 	ERISA and Related Matters	 	 	33	 
	 
	 	 	 	5.15.	 	Guaranties or Bonds	 	 	34	 
	 
	 	 	 	5.16.	 	Employees	 	 	34	 
	 
	 	 	 	5.17.	 	Environmental Matters	 	 	34	 
	 
	 	 	 	5.18.	 	Insurance Coverage	 	 	35	 
	 
	 	 	 	5.19.	 	Governmental Filings: No Violations	 	 	35	 
	 
	 	 	 	5.20.	 	Accounts Receivable	 	 	36	 
	 
	 	 	 	5.21.	 	Gratuitous Payments	 	 	36	 
	 
	 	 	 	5.22.	 	Disclosures	 	 	37	 
	 
	 	 	 	5.23.	 	Litigation	 	 	37	 
	 
	 	 	 	5.24.	 	Brokers and Finders	 	 	37	 
	 
	 	 	 	5.25.	 	Regulatory Proceedings	 	 	38	 
	 
	 	 	 	 	 	 	 	 	 	 
	6.	 	REPRESENTATIONS AND WARRANTIES OF RMO REGARDING SHAREHOLDERS, THE COMPANIES, AND SUBSIDIARIES AND THE SHARES	 	 	38	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	6.1.	 	Power and Authority; Enforceability	 	 	38	 
	 
	 	 	 	6.2.	 	No Violation or Conflict by Shareholders or the Companies	 	 	38	 
	 
	 	 	 	6.3.	 	Shareholders and the Companies Governmental Approvals	 	 	38	 
	 
	 	 	 	6.4.	 	Title to the Shares of Company Common Stock	 	 	39	 
	 
	 	 	 	6.5.	 	Litigation Against Shareholders or the Companies	 	 	39	 
	 
	 	 	 	6.6.	 	Investment	 	 	39	 
	 
	 	 	 	 	 	 	 	 	 	 
	6A.	 	REPRESENTATIONS AND WARRANTIES OF HOWELL, RIGO, WHELAN AND SMITH	 	 	40	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	6A.1.	 	Power and Authority; Enforceability	 	 	40	 
	 
	 	 	 	6A.2.	 	Title to the Shares of Company Common Stock	 	 	40	 
	 
	 	 	 	6A.3.	 	Investment	 	 	40	 
	 
	 	 	 	 	 	 	 	 	 	 
	7.	 	REPRESENTATIONS AND WARRANTIES OF PARENT	 	 	41	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	7.1.	 	Organization and Standing	 	 	41	 
	 
	 	 	 	7.2.	 	Corporate Power and Authority; Enforceability	 	 	41	 
	 
	 	 	 	7.3.	 	No Violation or Conflict by Parent	 	 	41	 
	 
	 	 	 	7.4.	 	Parent Governmental Approvals	 	 	41	 
	 
	 	 	 	7.5.	 	Litigation Against Parent	 	 	42	 

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	 	 	 	7.6.	 	Purchase for Investment	 	 	42	 
	 
	 	 	 	7.7.	 	Knowledge of Inaccuracies	 	 	42	 
	 
	 	 	 	7.8.	 	Investigations	 	 	43	 
	 
	 	 	 	 	 	 	 	 	 	 
	8.	 	CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT	 	 	43	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	8.1.	 	Representations True at the Closing	 	 	43	 
	 
	 	 	 	8.2.	 	Covenants of Shareholders	 	 	43	 
	 
	 	 	 	8.3.	 	No Injunction, Etc.	 	 	43	 
	 
	 	 	 	8.4.	 	Consents, Approvals and Waivers	 	 	43	 
	 
	 	 	 	8.5.	 	Absence of Material Adverse Effect	 	 	44	 
	 
	 	 	 	8.6.	 	Consummation of Merger pursuant to the Other Merger Agreement	 	 	44	 
	 
	 	 	 	 	 	 	 	 	 	 
	9.	 	CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SHAREHOLDERS AND THE COMPANIES	 	 	44	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	9.1.	 	Representations True at Closing	 	 	44	 
	 
	 	 	 	9.2.	 	Covenants of Parent	 	 	44	 
	 
	 	 	 	9.3.	 	No Injunction, Etc.	 	 	45	 
	 
	 	 	 	9.4.	 	Consents, Approvals and Waivers	 	 	45	 
	 
	 	 	 	9.5.	 	Consummation of Merger pursuant to the Other Merger Agreement	 	 	45	 
	 
	 	 	 	 	 	 	 	 	 	 
	10.	 	TRANSACTIONS AT CLOSING	 	 	45	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	10.1.	 	Transactions at Closing	 	 	45	 
	 
	 	 	 	 	 	 	 	 	 	 
	11.	 	SURVIVAL OF REPRESENTATION AND WARRANTIES; INDEMNIFICATION	 	 	47	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	11.1.	 	Survival of Representations, Warranties and Agreements	 	 	47	 
	 
	 	 	 	11.2.	 	Agreements to Indemnify Parent Indemnitees	 	 	47	 
	 
	 	 	 	11.3.	 	Agreements to Indemnify the Shareholders Indemnitees	 	 	48	 
	 
	 	 	 	11.4.	 	Recoveries	 	 	48	 
	 
	 	 	 	11.5.	 	Survival	 	 	48	 
	 
	 	 	 	11.6.	 	Notice and Defense of Actions	 	 	49	 
	 
	 	 	 	11.7.	 	Exclusive Remedy	 	 	51	 
	 
	 	 	 	11.8.	 	Treatment	 	 	51	 
	 
	 	 	 	 	 	 	 	 	 	 
	12.	 	TERMINATION	 	 	51	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	12.1.	 	Method of Termination	 	 	51	 
	 
	 	 	 	12.2.	 	Procedure and Effect of Termination	 	 	52	 
	 
	 	 	 	 	 	 	 	 	 	 
	13.	 	GENERAL PROVISIONS	 	 	53	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	13.1.	 	Notices	 	 	53	 
	 
	 	 	 	13.2.	 	Brokers	 	 	54	 
	 
	 	 	 	13.3.	 	Expenses	 	 	55	 
	 
	 	 	 	13.4.	 	Further Assurances	 	 	55	 
	 
	 	 	 	13.5.	 	Attribution of Knowledge	 	 	55	 
	 
	 	 	 	13.6.	 	Waiver	 	 	56	 
	 
	 	 	 	13.7.	 	Assignment; Binding Effect; No Third-Party Beneficiaries	 	 	56	 

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	 	 	 	13.8.	 	Headings	 	 	56	 
	 
	 	 	 	13.9.	 	Entire Agreement	 	 	56	 
	 
	 	 	 	13.10.	 	Modifications	 	 	56	 
	 
	 	 	 	13.11.	 	Governing Law	 	 	57	 
	 
	 	 	 	13.12.	 	Severability	 	 	57	 
	 
	 	 	 	13.13.	 	Counterparts	 	 	57	 
	 
	 	 	 	13.14.	 	Exhibits and Schedules Incorporated	 	 	57	 
	 
	 	 	 	13.15.	 	Joint Preparation	 	 	57	 
	 
	 	 	 	13.16.	 	Performance by Affiliates	 	 	58	 
	 
	 	 	 	13.17.	 	Consent to Jurisdiction; Waivers of Trial by Jury	 	 	58	 
	 
	 	 	 	13.18.	 	Shareholder Obligations	 	 	58	 

iv

 

LIST OF EXHIBITS

	 	 	 
	Exhibit A

	 	Form of Shareholders’ and the Companies’ Closing Certificate
	 
	 	 
	Exhibit B

	 	Form of Parent’s Closing Certificate

v

 

LIST OF SCHEDULES

	 	 	 
	 

	 	The Schedules of the Other Merger Agreement and this
Agreement shall be the same.
	 
	Schedule 3.2(j)

	 	Pre-Closing Employee Payment Issues
	 
	Schedule 3.2(k)

	 	Pre-Closing Company and Non-Company Affiliate Agreements
	 
	Schedule 4.2.1

	 	Each Company’s or Subsidiary’s Employees
	 
	Schedule 4.2.2

	 	NEO and Orwell Vacation and Sick Leave Policy
	 
	Schedule 5.2.1

	 	Shareholders’ Ownership Allocation of Company Common Stocks
	 
	Schedule 5.3.1

	 	Financial Statements
	 
	Schedule 5.3.2.1

	 	Assumed Debt
	 
	Schedule 5.3.2.2

	 	Undisclosed Liabilities
	 
	Schedule 5.4

	 	Taxes
	 
	Schedule 5.5.1

	 	Tangible Personal Property
	 
	Schedule 5.5.2

	 	Companies’ Procedure to Collect Accounts Receivable
	 
	Schedule 5.7

	 	Absence of Changes
	 
	Schedule 5.8

	 	Material Claims
	 
	Schedule 5.9

	 	Permits; Compliance with Laws
	 
	Schedule 5.10.1

	 	Owned Real Property
	 
	Schedule 5.10.2

	 	Leased Real Property
	 
	Schedule 5.10.3

	 	Real Property Matters
	 
	Schedule 5.11.1

	 	Intellectual Property
	 
	Schedule 5.11.2(a)

	 	Each Company’s and Subsidiary’s Software
	 
	Schedule 5.11.2(b)

	 	Non-Company Affiliates’ Software
	 
	Schedule 5.12

	 	Material Contracts
	 
	Schedule 5.13

	 	Labor Matters
	 
	Schedule 5.14

	 	ERISA and Related Matters
	 
	Schedule 5.15

	 	Guaranties or Bonds
	 
	Schedule 5.16

	 	Employees
	 
	Schedule 5.17

	 	Environmental Compliance
	 
	Schedule 5.18

	 	Insurance Coverage
	 
	Schedule 5.19

	 	Government Filings
	 
	Schedule 5.20

	 	Accounts Receivable
	 
	Schedule 6.2

	 	No Violation or Conflict by Shareholders or the Companies
	 
	Schedule 6.4

	 	Title to the Shares of Company Common Stock
	 
	Schedule 6.5

	 	Litigation Against Shareholders or the Companies
	 
	Schedule 7.3

	 	No Violation or Conflict by Parent
	 
	Schedule 7.4

	 	Parent Governmental Approvals

vi

 

	 	 	 
	Schedule 13.5(a)

	 	Attribution of Knowledge for Shareholders
	 
	Schedule 13.5(b)

	 	Attribution of Knowledge for Parent

vii

 

AGREEMENT AND PLAN OF MERGER

     THIS AGREEMENT AND PLAN OF MERGER (this “Agreement”) is entered into as of this 29th
day of June, 2009 (the “Effective Date”), by and among Energy West, Incorporated, a corporation
incorporated under the laws of the State of Montana (“Parent”), three to-be-formed
wholly-owned Ohio subsidiary corporations of Parent (each an “Acquisition Sub” and
collectively, the “Acquisition Subs”), Lightning Pipeline Co., Inc., an Ohio corporation
(“Lightning”), Great Plains Natural Gas Company, an Ohio corporation (“Great
Plains”), and Brainard Gas Corp., an Ohio corporation (“BGC”), (Lightning, Great Plains
and BGC shall be collectively referred to as the “Companies” and each to be sometimes
referred to as a “Company”), RICHARD M. OSBORNE, TRUSTEE (“RMO”), REBECCA HOWELL
(“Howell”), STEPHEN G. RIGO (“Rigo”), MARTY WHELAN (“Whelan”), and THOMAS
J. SMITH (“Smith”) (RMO, Howell, Rigo, Whelan and Smith are hereinafter collectively
referred to as “Shareholders”).

W I T N E S S E T H:

     WHEREAS, the Shareholders collectively own one hundred percent (100%) of the outstanding
shares of common stock of Lightning, Great Plains, and BGC (collectively, the “Company Common
Stock”);

     WHEREAS, Orwell Natural Gas Company, an Ohio corporation (“ONG”), and Northeast Ohio
Natural Gas Corp., an Ohio corporation (“NEO”), are wholly owned subsidiaries of Lightning
and Great Plains, respectively (collectively the “Subsidiaries” and each to sometimes be
referred to as a “Subsidiary”);

     WHEREAS, Parent is a regulated utility company whose service area includes Montana, Wyoming,
Maine, and North Carolina;

     WHEREAS, ONG, NEO, and BGC are regulated utility companies whose service areas include
portions of Ohio and Pennsylvania;

     WHEREAS, Parent has entered into a merger agreement as of even date herewith with Great Plains
Land Development Company, LTD., an Ohio limited liability company of which RMO is the sole member
(“GPL”), GPL is an affiliate of Lightning, Great Plains and BGC, and GPL leases all of its
real estate to NEO (the “Other Merger Agreement”);

     WHEREAS, Parent desires to increase its service area into Ohio and Pennsylvania; and

     WHEREAS, the respective Board of Directors of Parent and the Companies as well as the
Shareholders have determined that a business combination between Parent and the Companies is fair
to and in the best interests of their respective stockholders and presents an opportunity for their
respective companies to achieve long-term strategic and financial benefits, and accordingly have
agreed to effect a business combination under the terms and subject to the conditions set forth in
this Agreement, have approved this Agreement and have declared this Agreement and the Mergers
advisable;

 

 

     WHEREAS, in furtherance of the foregoing, the Board of Directors of Parent and each of the
Companies have approved this Agreement and the Mergers, upon the terms and subject to the
conditions of this Agreement, pursuant to which shares of Company Common Stock issued and
outstanding immediately prior to the Effective Time will be converted into the right to receive
shares of common stock, par value $0.15 per share, of Parent (“Parent Common Stock”)as set
forth in Section 2, other than stock of the Companies owned or held directly or indirectly
by Parent, Acquisition Subs or the Companies (or any of their respective direct or indirect
subsidiaries); and

     WHEREAS, for federal income tax purposes, it is intended by the parties that (i) the Mergers
qualify as a reorganization within the meaning of Section 368(a) of the Code, and (ii) this
Agreement constitute a plan of reorganization within the meaning of Section 368 of the Code and
related Treasury Regulations.

     NOW, THEREFORE, in consideration of the foregoing and the mutual promises, representations,
warranties, covenants and agreement set forth in this Agreement, and intending to be legally bound
hereby, the parties agree as follows:

1. DEFINITIONS

          1.1. Defined Terms.

     As used herein, the following terms shall have the following meanings unless the context
otherwise requires:

     “Accounts Receivable” means any and all accounts receivable of the Companies and
Subsidiaries, as the term “accounts receivable” is understood under GAAP.

     “Accrued Tax Liability” means the aggregate amount of Tax liabilities (including
deferred Taxes) of the Companies, Subsidiaries, and Affiliates as reflected on the Closing Date
balance sheet.

     “Action” has the meaning set forth in Section 11.6.1.

     “Active Customers” means all customers that receive a gas bill for an active meter
from either NEO, BGC or ONG during the ninety (90) days prior to the Closing Date.

     “Adjustment Amount” means the product of the difference between (i) the actual number
of Active Customers as of the Closing Date and (ii) 20,900, which difference shall then multiplied
by $1,598.09; provided, however, that in no event shall the Adjustment Amount be greater than
$6,552,169.00 (the equivalent of an additional 4,100 Active Customers). By way of example, if the
actual number of Active Customers at Closing is 21,000, then the Adjustment Amount shall be
$159,809 [21,000 - 20,900 = 100 x $1,598.09]. If on the other hand the number of Active Customers
is 20,800, then the Adjustment Amount shall be ($159,809) [20,800 - 20,900 = (100) x $1,598.09].

     “Affiliate” means (a) with respect to RMO, the Companies, and each of the
Subsidiaries; and (b) with respect to any other Person, any Person that, directly or indirectly,
through one or

2

 

more intermediaries, Controls, is Controlled by, or is under common Control with, such first
Person. For purposes of this definition and this Agreement, the Companies and Subsidiaries shall
be deemed to be Affiliates of Shareholders prior to the Closing and Affiliates of Parent from and
after the Closing.

     “Agreement” has the meaning set forth in the Preamble.

     “Articles of Merger” has the meaning set forth in Section 2.3.

     “Assets” means all of the assets, rights, interests, contract rights, accounts,
claims, credits, franchises and properties of the Companies and the Subsidiaries, whether real,
personal, tangible or intangible.

     “Assumed Debt” means all long term debt obligations, including loans from RMO, of the
Companies and Subsidiaries, incurred in the Ordinary Course of Business, as reflected on the
respective balance sheets of the Companies for the month preceding the Closing; provided that if
the Assumed Debt at Closing exceeds $19,983,498.66 and any portion of the Assumed Debt at Closing
is comprised of loans from any Shareholder or any of its Affiliates (“Shareholder Debt”) in
excess of $49,360.65 (the “Excess Shareholder Debt”), then the Excess Shareholder Debt
shall be converted into equity of the Companies prior to Closing.

     “Average Closing Price” means the average of the closing prices per share of the
Parent Common Stock as reported on Nasdaq for the twenty (20) consecutive trading days ending seven
(7) calendar days before the Closing Date.

     “Benefit Plan” means: (a) each “employee benefit plan,” as such term is defined in
Section 3(3) of ERISA, (b) each plan that would be an “employee benefit plan”, as such term is
defined in Section 3(3) of ERISA, if it was subject to ERISA, such as foreign plans and plans for
directors, (c) each stock bonus, stock ownership, stock option, stock purchase, stock appreciation
rights, phantom stock, or other stock plan (whether qualified or nonqualified), and (d) each bonus
or incentive compensation plan; provided, however, the term “Benefit Plan” shall
not include (i) routine employment policies and procedures or payroll plans developed and applied
in the ordinary course of business and consistent with past practice, including wage, vacation,
holiday, and sick or other leave policies, (ii) workers’ compensation insurance, and (iii)
directors’ and officers’ liability insurance.

     “Business Day” means any day excluding Saturday, Sunday and any day that is a legal
holiday in the State of Ohio.

     “CERCLA” has the meaning given to it in the definition of “Environmental Law.”

     “Closing” has the meaning set forth in Section 2.2.

     “Closing Date” has the meaning set forth in Section 2.2.

     “Code” means the Internal Revenue Code of 1986, as amended, and the rules and
regulations promulgated thereunder (the “Treasury Regulations”).

3

 

     “Companies” has the meaning set forth in the Preamble.

     “Company” has the meaning set forth in the Preamble.

     “Company Common Stock” has the meaning set forth in the Preamble.

     “Companies’ Employees” has the meaning set forth in Section 4.2.1.

     “Company Insurance Policies” means policies of insurance with insurance carriers and
contractual arrangements with insurance adjusters maintained by the Company or Subsidiaries or by
any Non-Company Affiliate that covers the Company or Shareholders prior to the Closing.

     “Company Plans” means each Benefit Plan (other than the Shareholders Plans) that is
sponsored or maintained as of the date of this Agreement by any of the Companies, or the
Subsidiaries for the benefit of any of their current or former directors, officers or employees.

     “Confidential Information” means (a) all information concerning a party hereto and/or
its Affiliates furnished to another party hereto or any director, member, officer, employee, agent,
advisor, or other representative (a “Representative”) of such receiving party or any of its
Affiliates in writing, orally or electronically by such disclosing party or any Representative of
such disclosing party or any of its Affiliates in connection with this Agreement or the
transactions contemplated herein, whether before or after the date hereof, including, but not
limited to, any such information (i) concerning the business, financial condition, operations,
products, services, assets, customers, forecasts and/or liabilities of such disclosing party and/or
its Affiliates, (ii) which relates to technologies, intellectual property or capital, models,
concepts, or ideas of such disclosing party and/or its Affiliates, (iii) of third parties that such
disclosing party and/or its Affiliates is required under applicable Law or contracts to keep
confidential, or (iv) that has been clearly identified as confidential; and (b) terms and
conditions of this Agreement and any other agreement entered into pursuant hereto, the fact that
the parties hereto have entered into this Agreement, and that this Agreement exists;
provided, however, the term “Confidential Information” shall not include
information that: (i) is already known or in the possession of such receiving party at the time of
disclosure, as evidenced by such receiving party’s written documentation, unless received or
obtained as confidential information; (ii) becomes subsequently available to such receiving party
on a non-confidential basis from a source not known or reasonably suspected by such receiving party
to be bound by a confidentiality agreement or secrecy obligation owed to such disclosing party;
(iii) is or becomes generally available to the public other than as a result of a breach of
Section 3.4.2 by such receiving party or any Representative of such receiving party or any
of its Affiliates; or (iv) is independently developed by such receiving party without use, directly
or indirectly, of Confidential Information of such disclosing party, as evidenced by such receiving
party’s written documentation; provided further, however, if only a portion
of the Confidential Information falls under one of the foregoing exceptions, then only that portion
shall not be deemed Confidential Information.

     “Consolidated” means: (i) with respect to the financial statement(s) of the Companies
and the Subsidiaries, the presentation of the results of operations and the financial position of
the Companies and the Subsidiaries essentially as if the Companies and the Subsidiaries were a

4

 

single company with one or more branches or divisions; and (ii) with respect to any financial
item(s) of the Companies and the Subsidiaries, the presentation of such item(s) essentially as if
the Companies and the Subsidiaries were a single company with one or more branches or divisions, in
each case as determined in accordance with GAAP (whether or not the Companies and the Subsidiaries
would in fact be Consolidated under GAAP).

     “Consolidated Income Tax Returns” means any Income Tax Returns filed for any
consolidated, combined or unitary group of corporations under federal, state or local laws, the
common parent of which is Shareholders.

     “Contract” means any legally binding obligation or agreement (other than a Benefit
Plan) to which the Companies or any of the Subsidiaries is a party, whether or not reduced to
writing, and specifically including but not limited to any note, bond, mortgage, lease of real or
personal property, license agreement, construction contract, subcontract, engineering contract,
guarantee, suretyship agreement, pledge agreement, indemnity, joint venture or partnership
agreement, confidentiality agreement, non-competition agreement, insurance contract, employment
agreement or other contract or agreement.

     “Control” means (a) possession, directly or indirectly, of the power to direct or
cause the direction of management and policies of a Person, whether through the ownership of voting
securities, as a trustee or executor, by contract or credit arrangement or otherwise, or (b) the
ownership of more than fifty percent (50%) of the equity interest in a Person.

     “Deductible” has the meaning set forth in Section 11.5.

     “Default” shall mean (a) a material breach or default, or (b) the occurrence of an
event that with the passage of time or the giving of notice or both would constitute a material
breach or default.

     “DOJ” means the United States Department of Justice.

     “Dollar” or “$” means the lawful currency of the United States.

     “Effective Time” has the meaning set forth in Section 2.3.

     “Environmental Law” means any federal, state, provincial or local law, statute,
ordinance, rule, regulation, or order relating to the protection of the environment, including the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.)
(“CERCLA”), the Hazardous Material Transportation Act (49 U.S.C. § 1801 et seq.), the
Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Federal Water Pollution
Control Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the Toxic
Substances Control Act (15 U.S.C. § 2601 et seq.), and the Safe Drinking Water Act (42 U.S.C. § 300
et seq.), as amended or supplemented, that is in effect on the Closing Date.

     “Exchange Ratio” has the meaning set forth in Section 2.8(a).

     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

5

 

     “FERC” means the United States Federal Energy Regulatory Commission.

     “Financial Statements” means the Year-End Financial Statements.

     “FIRPTA Certificate” means a certificate, as described in Treasury Regulation Section
1.1445-2(b)(2), which is signed under penalties of perjury by an authorized representative of
Shareholders, and which (i) certifies that the Shareholders are not “foreign persons,” as defined
in Treasury Regulation Section 1.1445-2(b)(2), and (ii) provides Shareholders’ names, identifying
numbers (as defined in Section 6109 of the Code), and office addresses.

     “FTC” means the United States Federal Trade Commission.

     “GAAP” means generally accepted accounting principles as recognized by the American
Institute of Certified Public Accountants, as in effect from time to time.

     “Governmental Authority” means any nation, province, state, county, municipality and
any other political subdivision of any of the foregoing, and any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to government, including MPSC,
WPSC, PPUC, FERC, FTC, DOJ, PUCO, SEC and IRS.

     “GPL” has the meaning set forth in the Preamble.

     “Guaranty or Bond” means any guaranty, letter of credit, surety bond and any other
similar material agreement or arrangement pursuant to which Shareholders or one or more Non-Company
Affiliates has obligations with respect to any obligations of the Companies or the Subsidiaries,
and any security or collateral furnished in connection with any such guaranty, letter of credit,
surety bond or other similar agreement or arrangement.

     “Hazardous Substance” means and includes each substance designated as a hazardous
waste, hazardous substance, hazardous material, pollutant, contaminant or toxic substance under any
Environmental Law and any petroleum hydrocarbons.

     “Income Tax” means any Taxes imposed on, or measured by, net income.

     “Income Tax Returns” means any Tax Returns relating to Income Taxes.

     “Indemnified Party” means any Person seeking indemnification from another Person
pursuant to Section 11.

     “Indemnifying Party” means any Person against whom a claim for indemnification is
asserted pursuant to Section 11.

     “Index Price” on a given date means the closing value on such date of the American Gas
Stock Index as maintained by the American Gas Association.

     “Intellectual Property” means the following intellectual property rights, including
both statutory and common law rights, if applicable: (a) copyrights and registrations for
copyrights, (b) trademarks, service marks, trade names, slogans, domain names, logos, symbols, and
trade

6

 

dress, and registrations and applications for registrations thereof, and (c) trade secrets and
confidential information, including ideas, designs, concepts, compilations of information, methods,
techniques, procedures, processes and other know-how, whether or not patentable.

     “IRS” means the United States Internal Revenue Service.

     “Law” means any law, statute, code, ordinance, regulation, order, reporting or
licensing requirement, or rule, including those promulgated, interpreted or enforced by any
Governmental Authorities.

     “Lien” means any mortgage, pledge, lien, security interest, hypothecation, conditional
sale agreement, restriction, option, defect in title, easement, encumbrance, charge, or other
similar title exception; provided, however, that the term “Lien” shall not include
(a) liens for current Taxes not yet due and payable, including liens for nondelinquent ad valorem
taxes and nondelinquent statutory liens arising other than by reason of any default on the part of
any of the Companies, the Subsidiaries, Shareholders or any of their Affiliates, (b) liens in favor
of carriers, warehousemen, mechanics, landlords and materialmen imposed by mandatory provisions of
Law and incurred in the Ordinary Course of Business for sums not yet due and payable, and (c) as to
any leased Asset, the rights of the lessor or landlord with respect to such leased Asset.

     “Losses” has the meaning set forth in Section 11.2.1.

     “Major Customer” shall mean any customer of the Companies or any of the Subsidiaries
from which the Companies or the Subsidiaries recognized in accordance with GAAP at least
Twenty-Five Thousand Dollars ($25,000.00) in revenue between January 1, 2008, and December 31,
2008.

     “Material Adverse Effect” means any change (or changes taken together) in, or effect
on, the business, financial condition, prospects, or operations of any of the Companies or
Subsidiaries that is (are) materially adverse to the business, financial condition, prospects, or
operations of the Companies or Subsidiaries, taken as a whole, but excluding any change (or changes
taken together) or effect which is cured (including by the payment of money) before the earlier of
the Closing or the termination of this Agreement under Section 12.1. Without limiting the
foregoing and except for purposes of Sections 5.7(l) and 8.5, any uninsured loss or
damage suffered by the Companies or Subsidiaries individually of Twenty-Five Thousand Dollars
($25,000) (or in the aggregate in excess of One Hundred Thousand Dollars ($100,000.00) shall be
deemed to have a Material Adverse Effect.

     “Material Contracts” has the meaning set forth in Section 5.12.1.

     “Merger” or “Mergers” have the meanings set forth in Section 2.1.

     “Merger Consideration” has the meaning set forth in Section 2.8(a).

     “MPSC” means the Montana Public Service Commission.

     “New Guaranty or Bond” has the meaning set forth in Section 4.3.1.

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     “Non-Company Affiliate” means any Affiliate controlled by RMO other than the Companies
or the Subsidiaries.

     “Ordinary Course of Business” means, with respect to the Companies and Subsidiaries,
the ordinary course of business which is consistent with past practices of the Companies and the
Subsidiaries.

     “Organizational Documents” means articles of incorporation, articles of organization,
certificate of incorporation, charter, bylaws, code of regulations, certificate of formation,
limited liability company operating agreement, joint venture agreement or partnership agreement, as
applicable.

     “Other Merger Agreement” has the meaning set forth in the Preamble.

     “Parent” has the meaning set forth in the Preamble.

     “Parent Common Stock” has the meaning set forth in the Preamble.

     “Parent Indemnitees” has the meaning set forth in Section 11.2.1.

     “Patent” means (a) any patent granted by the U.S. Patent and Trademark Office or
comparable agency of any other country, as well as any reissued and reexamined patent and
extensions corresponding to such patent, and (b) any patent application filed with the U.S. Patent
and Trademark Office or comparable agency in any other country, as well as any related continuation
or continuation in part, any divisional application and patent issuing therefrom, and any
respective foreign counterpart patent application or foreign patent issuing therefrom.

     “Permits” means all licenses and permits issued by any Governmental Authority.

     “Person” means an individual, partnership, limited partnership, joint venture, limited
liability company or partnership, corporation, bank, trust, company, business entity, governmental
entity or organization, or unincorporated organization.

     “PPUC” means the Pennsylvania Public Utilities Commission.

     “Pre-Closing Income Tax Returns” has the meaning set forth in Section 4.1.1.

     “Property and Casualty Claims” has the meaning set forth in Section 4.5.

     “PUCO” means The Public Utilities Commission of Ohio.

     “Real Property Leases” has the meaning set forth in Section 5.10.2.

     “Regulatory Approval” means the approval by the MPSC, WPSC, PPUC and PUCO of the
transaction contemplated by this Agreement.

     “Regulatory Filings” has the meaning set forth in Section 3.3.3(a).

8

 

     “Representative” has the meaning given to it in the definition of “Confidential
Information.”

     “Restricted Period” means the period commencing on the Closing Date and expiring on
the second anniversary of the Closing Date.

     “Retained Employee Liabilities” has the meaning set forth in Section 4.2.1.

     “Scheduled Claim” means any of the matters set forth in Schedule 5.7.

     “SEC” means the United States Securities and Exchange Commission.

     “Shareholder” has the meaning set forth in the Preamble.

     “Shareholder Indemnitees” has the meaning set forth in Section 11.3.

     “Shareholders Plan” means each Benefit Plan (other than the Company Plans) that is
sponsored, maintained or contributed to as of the Closing Date by the Companies or Subsidiaries or
a Non-Company Affiliate and that covers the current or former directors, officers or employees of
the Companies or Subsidiary.

     “Separate Income Tax Returns” means Income Tax Returns of the Companies, its
Subsidiaries, and any Affiliate, other than Consolidated Income Tax Returns.

     “Share Consideration Value” shall mean a dollar amount equal to the aggregate number
of shares of Parent Common Stock being issued to Shareholders hereunder multiplied by the Average
Closing Price (where such calculation shall be made to the closest whole dollar).

     “Software” means computer software programs including operating systems, application
programs and software tools.

     “Starting Date” shall mean the last full trading day prior to September 12, 2008.

     “Straddle Returns” has the meaning set forth in Section 4.1.2.

     “Subsidiaries” has the meaning set forth in the Preamble.

     “Tangible Personal Property” means all machines, equipment, tools, computers,
terminals, telephones, telephone systems, furniture, automobiles, fixtures, leasehold improvements,
parts and other tangible personal property and fixtures owned or leased by the Companies or the
Subsidiaries, including the property listed on Schedule 5.5.1.

     “Tax” or “Taxes” means all United States, federal, state and local, and all
foreign, income, profits, franchise, gross receipts, payroll, transfer, sales, employment, use,
property, license, excise, value added, ad valorem, estimated, stamp, alternative or ad-on minimum,
recapture, environmental, withholding and any other taxes, charges, duties, impositions or
assessments, together with all interest and penalties and additions imposed on or with respect to

9

 

such amounts, or levied, assessed or imposed against the Companies or any of the Subsidiaries,
including any liability for taxes of any predecessor entity.

     “Tax Audit” has the meaning set forth in Section 4.1.7(a).

     “Tax Indemnified Person” has the meaning set forth in Section 4.1.7(a).

     “Tax Indemnifying Person” has the meaning set forth in Section 4.1.7(a)

     “Tax Return” means any return, declaration, report, claim for refund, or information
return or statement filed or required to be filed by the Companies, including any predecessor
entities, with any taxing authority under federal, state, local or any foreign laws in connection
with the determination, assessment, collection or imposition of any Taxes.

     “Third Party” means any Person other than Shareholders, the Companies, Parent, any
Indemnified Party or any Affiliate of Shareholders, Parent or any Indemnified Party.

     “Transfer Tax” has the meaning set forth in Section 4.1.6.

     “Transferred Employee” has the meaning set forth in Section 4.2.1.

     “Walkaway Determination Date” shall mean the date that is seven (7) calendar days
prior to the Closing Date.

     “WPSC” means the Wyoming Public Service Commission.

     “Year-End Financial Statements” means the unaudited, pro forma consolidated balance
sheet of the Companies dated December 31, 2008.

          1.2. Construction of Certain Terms and Phrases

     Unless the context of this Agreement otherwise requires, (a) words of any gender include the
other gender; (b) words using the singular or plural number also include the plural or singular
number, respectively; (c) the terms “hereof,” “herein,” “hereunder,” “hereby” and derivative or
similar words refer to this entire Agreement; (d) the terms “include,” “includes,” and “including”
shall be deemed to be followed by the words “but not limited to;” (e) the term “Section” refers to
the specified Section of this Agreement; (f) the term “Schedule” or “Exhibit” refers to a Schedule
or Exhibit attached to this Agreement; (g) references to time are to Cleveland, Ohio time; and (h)
the term “material” and derivative or similar words refer to materiality with respect to the
Companies and the Subsidiaries on an aggregate basis. Whenever this Agreement refers to a number
of days, such number shall refer to calendar days unless Business Days are specified. Except as
otherwise stated herein, all accounting terms used herein and not expressly defined herein shall
have the meanings given to them under GAAP.

2. THE MERGERS

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          2.1. The Mergers

     Upon the terms and subject to the conditions set forth in this Agreement, at the Effective
Time:

               (a) an Acquisition Sub shall be merged with and into Lightning in accordance with the
provisions of the Ohio Revised Code and this Agreement, and the separate corporate existence of
such Acquisition Sub shall thereupon cease and Lightning shall be the surviving corporation in the
Merger (sometimes referred to herein as a “Surviving Corporation”). Following the
Effective Time, Lightning, as the Surviving Corporation, shall succeed to and assume all of the
rights and obligations of such Acquisition Sub;

               (b) an Acquisition Sub shall be merged with and into Great Plains in accordance with the
provisions of the Ohio Revised Code and this Agreement, and the separate corporate existence of
such Acquisition Sub shall thereupon cease and Great Plains shall be the Surviving Corporation in
the Merger. Following the Effective Time, Great Plains, as the Surviving Corporation, shall
succeed to and assume all of the rights and obligations of such Acquisition Sub; and

               (c) an Acquisition Sub shall be merged with and into BGC in accordance with the provisions of
the Ohio Revised Code and this Agreement, and the separate corporate existence of such Acquisition
Sub shall thereupon cease and BGC shall be the Surviving Corporation in the Merger. Following the
Effective Time, BGC, as the Surviving Corporation, shall succeed to and assume all of the rights
and obligations of such Acquisition Sub.

Each of the actions taken in the above Section 2.1(a), (b) and (c) shall be referred to a
“Merger” and collectively as the “Mergers.”

          2.2. The Closing

     The closing of the Mergers (the “Closing”) shall take place on the first Business Day
of the first full month following the satisfaction or waiver (subject to applicable Law) of the
conditions (other than those conditions that by their nature are to be fulfilled at the Closing,
but subject to the fulfillment or waiver of such conditions) set forth in Section 8, unless
this Agreement has previously terminated pursuant to its terms or unless another date is agreed to
in writing by the parties (the actual date of Closing being referred to herein as the “Closing
Date”). The Closing shall be held at 10 a.m. at the offices of Kohrman Jackson & Krantz,
P.L.L., 1375 E. Ninth Street, 20th Floor, Cleveland, Ohio 44114, unless another place is
agreed to in writing by the parties.

          2.3. Effective Time

     At the Closing, the parties shall file three articles of merger (each “Articles of
Merger”) in such form as required by and executed in accordance with the relevant provisions of
the Ohio Revised Code. Each Merger shall become effective at the time of filing of the applicable
Articles of Merger with the Ohio Secretary of State in accordance with the Ohio Revised Code or
such later time as the Companies and Parent shall have agreed upon and designated in each

11

 

Articles of Merger as the effective time of each Merger (the time each Merger becomes
effective being the “Effective Time”).

          2.4. Effects of Mergers

     At and after the Effective Time, each Merger shall have the effects specified herein and in
the Ohio Revised Code. As a result of the Mergers, each Surviving Corporation shall become a
wholly-owned subsidiary of Parent.

          2.5. Articles of Incorporation of each Surviving Corporation

     As of the Effective Time, the articles of incorporation of each Acquisition Sub as in effect
immediately prior to the Effective Time shall be the articles of incorporation of such Surviving
Corporation, until thereafter amended as provided therein or by applicable Law; provided, however,
that the articles of incorporation of each Surviving Corporation shall be amended in the Merger to
provide that the Surviving Corporation shall have the name of each such Company.

          2.6. Code of Regulations of each Surviving Corporation

     As of the Effective Time, the code of regulations of each Acquisition Sub as in effect
immediately prior to the Effective Time shall be the code of regulations of such Surviving
Corporation, until thereafter amended as provided therein or by applicable Law; provided, however,
that each such code of regulations shall be amended to reflect the change of name of the Surviving
Corporation as provided in Section 2.5 above.

          2.7. Directors and Officers of each Surviving Corporation

     The directors and officers of each Acquisition Sub immediately prior to the Effective Time
shall be the officers and directors of such Surviving Corporation, from and after the Effective
Time, until their successors shall be elected and qualified or their earlier death, resignation or
removal in accordance with the articles of incorporation and code of regulations of such Surviving
Corporation.

          2.8. Effect on Capital Stock

               (a) At the Effective Time, by virtue of the Mergers and without any action on the part of each
Shareholder, each share of Company Common Stock issued and outstanding immediately prior to the
Effective Time (other than shares of common stock of the Companies to be cancelled without payment
of any consideration therefore pursuant to Section 2.8(c)) shall be converted into the
right to receive shares of validly issued, fully paid and non-assessable Parent Common Stock (the
“Merger Consideration”) based on the following calculation computed as of the Closing Date:

The total number of shares of Parent Common Stock that the Shareholders shall be
entitled to receive for Merger Consideration for the Companies shall be the

12

 

total of Thirty-One Million Two Hundred Four Thousand Dollars ($31,204,000.00)
(subject to adjustment up or down, as the case may be, by the Adjustment Amount)
less the Assumed Debt divided by $10 (the “Exchange Ratio”).

Prior to Closing, the parties shall amend this Agreement by Schedule 2.8(a) to
allocate the Merger Consideration in a share-for-share ratio by Company.

               (b) As a result of the Mergers and without any action on the part of the holders thereof, at
the Effective Time, all shares of Company Common Stock shall cease to be outstanding and shall be
canceled and retired and shall cease to exist, and each holder of a certificate previously
representing any such shares of Company Common Stock shall thereafter cease to have any rights with
respect to such shares of Company Common Stock, except the right to receive (i) the Merger
Consideration payable in respect of such shares of Company Common Stock, and (ii) any cash to be
paid in lieu of any fractional share of Parent Common Stock pursuant to Section 2.12.

               (c) At the Effective Time, each share of Company Common Stock issued and held in each
Company’s treasury and each share of Company Common Stock issued and owned immediately prior to the
Effective Time by Acquisition Sub or Parent (or any of their respective direct or indirect wholly
owned Subsidiaries) shall, by virtue of the Mergers, cease to be outstanding and shall be canceled
and retired and no Parent Common Stock or other consideration shall be delivered in exchange
therefor.

               (d) At the Effective Time, by virtue of the Mergers and without any action on the part of the
holder thereof, each share of common stock, par value $0.01 per share, of each Acquisition Sub
issued and outstanding immediately prior to the Effective Time shall be converted into one validly
issued, fully paid and nonassessable share of common stock, par value $0.01 per share, of each
Surviving Corporation.

          2.9 Change in Shares

     If, between the date of this Agreement and the Effective Time (and to the extent permitted by
this Agreement), the outstanding shares of Company Common Stock shall have been increased,
decreased, changed into or exchanged for a different number of shares or different class, in each
case by reason of any reclassification, recapitalization, subdivision, stock split, reorganization,
combination, contribution or exchange of shares, or a stock dividend or dividend payable in other
securities shall be declared with a record date within such period, or any similar event shall have
occurred, the Exchange Ratio and any other number or amount contained herein which is based upon
the number of shares of Company Common Stock shall be appropriately adjusted to provide to Parent
and the holders of Company Common Stock the same economic effect as contemplated by this Agreement
prior to such event.

          2.10 Exchange Procedures

     At Closing, the Shareholders shall be entitled to receive in exchange for their Company Common
Stock (A) one or more shares of Parent Common Stock (which shall be in certificated

13

 

form with the applicable restrictive legends) representing, in the aggregate, the whole number of
shares of Parent’s common stock that such Shareholder has the right to receive pursuant to
Section 2.8 and/or (B) a check in the amount equal to the cash that such holder has the
right to receive consisting of cash in lieu of fractional shares of Parent Common Stock pursuant to
Section 2.12 (the “Cash Payment”). No interest will be paid or accrued on any Cash
Payment.

          2.11 No Further Ownership Rights or Claims Relating to Company Common Stock 

     All Merger Consideration issued and any cash paid upon conversion of shares of Company Common
Stock pursuant to this Section 2 shall be deemed to have been issued and paid in exchange
for, and in full satisfaction of, all rights pertaining to such shares of Company Common Stock and
any claims for, relating to or arising out of shares of Company Common Stock or ownership thereof.

          2.12 No Fractional Shares of Parent Common Stock

     Notwithstanding any other provision of this Agreement, each Shareholder who would otherwise
have been entitled to receive a fraction of a share of Parent Common Stock (after taking into
account all shares of Company Common Stock delivered by such Shareholder) shall receive, in lieu
thereof, cash (without interest) in an amount equal to the product of (i) such fractional part of a
share of Parent Common Stock multiplied by (ii) the Average Closing Price. Such payment of cash
consideration is in lieu of fractional shares of Parent Common Stock.

          2.13 Lost Certificates

     If any certificate for shares of Company Common Stock shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming such certificate to
be lost, stolen or destroyed and, if required by Parent, the posting by such person of a bond in
such reasonable amount as Parent may direct as indemnity against any claim that may be made against
it with respect to such certificate Parent will deliver in exchange for such lost, stolen or
destroyed certificate the applicable Merger Consideration and any Cash Payment with respect to the
shares of Company Common Stock formerly represented thereby.

          2.14 Withholding Rights

     Each Surviving Corporation and Parent shall be entitled to deduct and withhold from the
consideration otherwise payable pursuant to this Agreement to Shareholders such amounts as it is
required to deduct and withhold with respect to the making of such payment under the Code and the
Treasury Regulations, or any provision of state, local or foreign tax law. To the extent that
amounts are so withheld by the Surviving Corporation or Parent, as the case may be, such withheld
amounts shall be treated for all purposes of this Agreement as having been paid to Shareholders in
respect of which such deduction and withholding was made by the Surviving Corporation or Parent, as
the case may be.

          2.15 Further Assurances

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     After the Effective Time, the officers and directors of each Surviving Corporation will be
authorized to execute and deliver, in the name and on behalf of the Companies or Acquisition Subs,
all deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf
of the Companies or Acquisition Subs, all other actions and things to vest, perfect or confirm of
record or otherwise in each Surviving Corporation all right, title and interest in, to and under
the rights, properties and assets acquired or to be acquired by the Surviving Corporation as a
result of, or in connection with, the Mergers.

          2.16 Stock Transfer Books

     The stock transfer books of the Companies shall be closed immediately upon the Effective Time
and there shall be no further registration of transfers of shares of Company Common Stock
thereafter on the records of the Companies. On or after the Effective Time, all shares of Company
Common Stock presented to Parent in accordance with the provisions of this Agreement shall be
converted into the Merger Consideration and any Cash Payment payable with respect to the shares of
Company Common Stock formerly represented thereby.

3. PRE-CLOSING COVENANTS AND UNDERTAKINGS

          3.1. Satisfaction of Closing Conditions

     The parties shall use their commercially reasonable efforts to bring about, as soon as
practical after the date hereof, the satisfaction of all the conditions set forth in
Sections 8 and 9.

          3.2. Conduct of the Business of the Companies and Subsidiaries
Prior to Closing

     Except as in the Ordinary Course of Business or with the prior written consent of Parent
(which consent shall not be unreasonably withheld, delayed or denied), or as otherwise provided in
Schedule 3.2 or in any other Schedule attached to this Agreement, and except as may be
required to effect the transactions contemplated by this Agreement, or as is otherwise authorized
by this Agreement, RMO covenants that he shall, and shall cause the Companies and Subsidiaries to,
during the period commencing on the date of this Agreement and terminating at the Closing:

               (a) preserve intact the legal existence of the Companies and Subsidiaries and carry on each
Company’s and each Subsidiary’s business in the Ordinary Course of Business, and use its
commercially reasonable efforts to preserve the goodwill of the Companies and Subsidiaries;

               (b) maintain the Tangible Personal Property in the Ordinary Course of Business;

               (c) keep in force at no less than their present limits all existing surety bonds and policies
of insurance insuring the Assets and each Company’s and Subsidiary’s business, except to the extent
that any such surety bond or insurance policy is no longer applicable or otherwise required
pursuant to the business of the Companies and Subsidiaries;

15

 

               (d) use commercially reasonable efforts to maintain in full force and effect all Permits held
by the Companies or Subsidiaries, except those Permits the failure of which to hold, individually
or in the aggregate, could not reasonably be expected to have a Material Adverse Effect;

               (e) neither enter into, modify, amend or terminate any Material Contract or Real Property
Lease, nor waive, release, compromise or assign any material rights or claims thereunder, nor
suffer, permit or incur any of the transactions or events described in Section 5.7 to the
extent such events or transactions are within the reasonable control of Shareholders, the
Companies, or the Subsidiaries;

               (f) not make any distributions of the Assets to Shareholders in the form of return of capital
or dividends;

               (g) not make or permit any change in each Company’s or Subsidiary’s Organizational Documents,
or in any Company’s or Subsidiary’s authorized, issued or outstanding securities;

               (h) not issue any additional shares of capital stock or other securities or ownership
interests of any Company or Subsidiary, grant any stock option or right to purchase any security or
ownership interest of any Company or Subsidiary, issue any security or ownership interest
convertible into such securities or ownership interests, purchase, redeem, retire or otherwise
acquire any of such securities or ownership interests, or declare, set aside or pay any dividend or
cash distribution in respect of the securities or ownership interests of any Company or Subsidiary,
except for the transfer of shares prior to Closing to Howell, Rigo, Whelan, and Smith in accordance
with the ownership allocation set forth in Schedule 5.2.1;

               (i) not make any changes in the accounting methods or practices of the Companies or
Subsidiaries;

               (j) not (i) pay, or incur any obligation for any payment of, any contribution or other amount
to, or with respect to, any Company Plan, (ii) pay any bonus to, make any loan, pay or transfer any
Assets to, or grant any increase in the compensation of, any Company or Subsidiary director,
officer, or employee, (iii) make any increase in the pension, retirement or other benefits of the
directors, officers, or employees, except as set forth in Schedule 3.2(j), or (iv) hire
any additional employees, even in the Ordinary Course of Business, without the prior written
consent of the Parent, which consent shall not be unreasonably withheld;

               (k) not have the Companies or Subsidiaries pay, lend or advance any amount to or in respect
of, or sell, transfer or lease any Assets to, or enter into any agreement, arrangement or
transaction with, Shareholders or any Non-Company Affiliate, except for the payments, agreements,
arrangements, leases, transactions and arrangements set forth in Schedule 3.2(k);

               (l) not permit the Companies or Subsidiaries to (i) incur or assume any indebtedness for
borrowed money or issue any debt securities, or (ii) assume, guarantee, endorse

16

 

or otherwise become liable or responsible (whether directly, contingently or otherwise) for
the obligations of any Person;

               (m) not permit the Companies or Subsidiaries to (i) make any loans, advances or capital
contributions to, or investments in, any Person, (ii) pledge or otherwise encumber shares of any
Company or Subsidiary capital stock, or (iii) mortgage or pledge any of the Assets, or create or
suffer to exist any Lien thereupon;

               (n) not permit the Companies or Subsidiaries to acquire, sell, lease or dispose of any
Assets;

               (o) not permit the Companies or Subsidiaries to (i) acquire any Person (or division thereof),
any equity interest therein or all or substantially all of the assets thereof whether through a
merger, consolidation or purchase, or (ii) enter into a joint venture, partnership or any other
equity alliance with any Person;

               (p) not permit RMO or any Non-Company Affiliate to hire away any essential employee of the
Companies or Subsidiaries without Parent’s prior written consent; and

               (q) not agree to do anything, or agree to permit the Companies or Subsidiaries to do anything,
that would violate any of the foregoing affirmative and negative covenants of this Section
3.2.

          3.3. Consents and Approvals

          3.3.1. Subject to the allocation of responsibility set forth in Section 3.3.2, RMO
agrees to, and agrees to cause the Companies or Subsidiaries, as the case may be, to apply for and
use commercially reasonable efforts to obtain no later than at the Closing (a) the Regulatory
Approval, (b) the waiver, consent and approval of all Persons whose waiver, consent or approval is
required by Law for each Company’s and Shareholder’s execution and delivery of this Agreement and
the Shareholders’ and each Company’s or Subsidiary’s consummation of the transactions contemplated
herein, and (c) the waiver, consent and approval of all Persons whose waiver, consent or approval
is required by any Material Contract, Real Property Lease, consent, judgment, decree, order or
Permit to which the Shareholders, the Companies, or Subsidiaries is a party or subject immediately
prior to the Closing, and which would prohibit or require the waiver, consent or approval of any
Person to, such transactions or under which, without such waiver, consent or approval, such
transactions would constitute an occurrence of Default under the provisions thereof,
provided, however, that neither RMO nor the Companies or Subsidiaries shall make
any agreements or understandings adversely affecting the Assets or the Companies or Subsidiaries,
or their business, as a condition to obtaining any waivers, consents or approvals required by this
Section 3.3.1, except as otherwise provided herein or with the prior written consent of
Parent, and further provided that if RMO fails to obtain any consents that are required under this
Section 3.3 prior to Closing (except any required governmental consents, consents of
lenders or consents relating to any of the pipelines), such failure shall not be deemed a Default
under this Agreement and/or cause this Agreement not to be consummated so long as the failure to
obtain the consent does not have a Material Adverse Effect on the consummation of this Agreement,
the Company, the Subsidiaries, or the Assets.

17

 

          3.3.2. Each of the parties hereto (a) will take all commercially reasonable actions necessary
to comply promptly with all Laws that may be imposed on such party with respect to the transactions
contemplated herein (including requesting all necessary approvals for and executing all necessary
agreements for the novation of any Material Contracts with any Governmental Authority, requesting
all necessary material approvals of subcontractors to such contracts, providing notices and
disclosures as required for foreign Persons, and furnishing all information required under any Law
in connection with approvals of or filings with any Governmental Authority (including without
limitation MPSC, PUCO, WPSC, FTC, DOJ, SEC, PPUC or IRS)); provided, however, the
foregoing shall not require any of the parties hereto or any of their Affiliates to sell or
otherwise divest of a material portion of their respective assets or properties or discontinue any
of their respective significant operations; and (b) will promptly cooperate with and furnish
information to each other in connection with any such legal requirements imposed upon any of them
in connection with the transactions contemplated herein. Any filings or approvals required to be
accomplished by Shareholders, the Companies, Subsidiaries or any Non-Company Affiliate in
accordance with this Section 3.3.1 shall be at Shareholders’ or such Non-Company
Affiliate’s expense.

          3.3.3. MPSC, WPSC, PPUC and PUCO Regulatory Filings.

               (a) Parent and each Company shall have joint responsibility for the preparation and filing
of the regulatory filings to be made to the MPSC, WPSC, PPUC and PUCO requesting Regulatory
Approval ( “Regulatory Filings”). Upon the request of the other party, each Company and
Parent shall use commercially reasonable efforts to cooperate with such other party to prepare
and file such Regulatory Filings [if necessary].

               (b) Parent and each Company shall use commercially reasonable efforts to file as soon as
practicable after the date hereof the Regulatory Filings, and execute all agreements and
documents, in each case, to obtain as promptly as practicable the Regulatory Approvals. Parent,
each Company and RMO shall act diligently, and shall coordinate in completing and submitting the
Regulatory Filings. Parent and RMO shall each have the right to review and approve (which such
approval shall not be unreasonably withheld, delayed or conditioned) in advance all of the
information relating to the transactions contemplated by this Agreement which appears in the
Regulatory Filings. Parent and RMO agree that all telephonic calls and meetings with the MPSC,
WPSC, PPUC or PUCO relating to the transactions contemplated by this Agreement shall be
conducted by Parent and RMO jointly. Each party will bear its own legal costs incurred in
connection with the preparation and filing of the Regulatory Filings.

          3.3.4. Nothing in this Agreement will require Parent, Shareholders, Companies or Subsidiaries
to accept any condition to, limitation on or other term concerning the grant of Regulatory Approval
if such condition, limitation or other term, alone or in the aggregate with such other conditions,
limitation or other terms would (i) require the disposition by Parent, Shareholders, Companies or
Subsidiaries of any material asset(s); (ii) have a Material Adverse Effect on Parent, Shareholders,
Companies or Subsidiaries in its acquisition, ownership, use, operation or disposition of any
property other than the Assets; or (iii) materially change or impair the commercial expectation of
the Parent, Shareholders, Companies or Subsidiaries with respect to the sale or distribution of gas
by the Companies or the Subsidiaries.

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          3.4. Access, Information and Confidentiality

          3.4.1. Prior to the Closing, Shareholders shall cause the Companies or Subsidiaries to (a)
give Parent and its authorized Representatives reasonable access, during normal business hours and
upon reasonable notice, to the books, records, files, documents and contracts of the Companies and
Subsidiaries, and (b) allow Parent (together with its authorized Representatives) to make a
reasonable number of visits to each office, facility and other property owned or leased by the
Companies or Subsidiaries.

          3.4.2. (a) Subject to the first sentence of subsection (b) of this Section 3.4.2, a
party hereto receiving Confidential Information from another party hereto shall not disclose and
shall keep strictly confidential all such Confidential Information of such disclosing party;
provided, however, that such receiving party may disclose Confidential Information of such
disclosing party (i) to any Representative of such receiving party or any of its Affiliates who
needs to know such information for purposes of consummating the transactions contemplated herein;
(ii) to any partner, Affiliate, lender or investor of such receiving party or any of its
Affiliates, or any Representative of such partner, Affiliate, lender or investor who needs to know
such information for purposes of consummating the transactions contemplated herein; and (iii) to
the extent that such receiving party or Representative is required to disclose such information in
order to avoid committing a violation of any applicable law, rule or regulation, including any
rules or regulations of any securities association, stock exchange or national securities quotation
system.

               (b) In the event that a receiving party or any Representative of such receiving party or any
of its Affiliates is requested or required, pursuant to any applicable court order, administrative
order, statute, regulation or other official order by any Governmental Authority, to disclose any
Confidential Information of a disclosing party, such receiving party shall (i) provide such
disclosing party with prompt written notice of any such request or requirement so that such
disclosing party may seek a protective order or other appropriate remedy and/or waive compliance
with the provisions of this Section 3.4.2, and (ii) reasonably cooperate with such
disclosing party to obtain such protective order or other remedy. In the event such protective
order or other remedy is not obtained and a disclosing party fails to waive compliance with the
relevant provisions of this Section 3.4.2, such receiving party agrees to (A) furnish only
that portion of the Confidential Information for which such receiving party is advised by written
opinion of its legal counsel obtained at the disclosing party’s expense, is legally required to be
disclosed, (B) upon such disclosing party’s request and expense, use its commercially reasonable
efforts to obtain assurances that confidential treatment will be accorded to such information, and
(C) give such disclosing party prior written notice of the Confidential Information to be
disclosed.

               (c) If this Agreement is terminated prior to the Closing or at any other time for any reason,
upon the written request of a disclosing party, each receiving party will, and will cause all
Representatives of such receiving party or any of its Affiliates to promptly, (i) deliver to such
disclosing party all original Confidential Information (whether written or electronic) furnished to
such receiving party or any Representative of such receiving party or any of its Affiliates by or
on behalf of such disclosing party, and (ii) if specifically requested by such disclosing party,
destroy (A) any copies of such Confidential Information (including any

19

 

extracts therefrom), and (B) any portion of such Confidential Information that may be found in
reports, analyses, notes, compilations, studies and other documents prepared by or for such
receiving party. From and after the Closing, Parent shall be released from all obligations owed by
it to Shareholders under this Section 3.4.2 with respect to the Confidential Information
owned by the Companies or Subsidiaries. This Section 3.4.2 shall survive any termination
of this Agreement.

          3.5. Delivery of Financial Statements and Regulatory Filings

     During the period commencing on the date of this Agreement and terminating at the Closing, RMO
shall cause to be delivered to Parent, within thirty (30) days of being available or filed, copies
of (a) all regularly prepared unaudited monthly, quarterly and annual consolidated financial
statements of the Companies and Subsidiaries prepared after the date of this Agreement, and (b) all
material filings or submissions by the Companies or Subsidiaries with any Governmental Authority
made after the date of this Agreement.

          3.6. Public Announcements

     No party hereto or any of its Affiliates shall make any public announcement of the execution
and delivery of this Agreement or the transactions contemplated by this Agreement without first
obtaining the prior written consent of the other party hereto, such consent not to be unreasonably
withheld, delayed or conditioned; provided, however, that nothing contained in this
Section 3.6 shall prohibit any party hereto or any of its Affiliates from (a) making any
disclosures or having any discussions with the MPSC, WPSC, PPUC or PUCO regarding this Agreement or
the transaction contemplated by this Agreement in accordance with Section 3.3.2, or (b)
making any public announcement in accordance with any required SEC filing, or (c) having
discussions with its lenders, or (d) making any public announcement if such party or its Affiliate
determines in good faith, on the advice of legal counsel, that such public disclosure is required
by applicable Law or any listing agreement with a national securities exchange or trading market;
provided further, that in such event, such party or its Affiliate shall consult
with the other party hereto prior to making such disclosure to the extent reasonably practicable.

4. ADDITIONAL AGREEMENTS

          4.1. Tax Matters 

          4.1.1. RMO shall (i) cause each Company and Subsidiary to prepare and file on a timely basis
all Tax Returns of the Companies and Subsidiaries for all Tax periods which end on or prior to the
Closing Date, which are filed before or after the Closing Date; and (ii) pay all Taxes of the
Companies and Subsidiaries with respect to such Tax periods, or, at Parent’s option, shall
reimburse Parent within fifteen (15) days after payment by Parent of such Taxes. RMO shall cause
to be prepared all Income Tax Returns of the Companies and Subsidiaries due after the Closing Date
that relate solely to periods ending on or before the Closing Date (such Separate Income Tax
Returns being referred to as “Pre-Closing Income Tax Returns”). RMO shall submit to Parent
any Pre-Closing Income Tax Returns at least thirty (30) days prior to the due date of such Tax
Return (taking into account any validly obtained extensions) for Parent’s review. Parent and
Shareholders shall collectively cause the Companies and Subsidiaries to timely and

20

 

appropriately file all Pre-Closing Income Tax Returns submitted by the Shareholders in
accordance with this Section 4.1.1. The parties acknowledge that Great Plains and
Lightning will lose their “S-Corporation” status and NEO and ONG will lose their “Qualified
Subchapter S-subsidiary” status, each as of the end of the day prior to the Closing Date.
Consequently, Shareholders agree that pursuant to the Code the books of Great Plains and Lightning
shall be closed as of the end of the day prior to the Closing Date, and the final Tax Returns for
these two companies shall be treated as Pre-Closing Income Tax Returns.

          4.1.2. Parent shall cause the Companies and Subsidiaries to prepare and file on a timely basis
all Tax Returns of the Companies and Subsidiaries (other than Pre-Closing Income Tax Returns) due
after the Closing Date, including all Tax Returns that relate to periods beginning before and
ending after the Closing Date (“Straddle Returns”). All Straddle Returns shall be prepared
on a basis consistent with procedures and practices of the Companies and Subsidiaries in effect as
of the date hereof for filing such Tax Returns. Parent shall submit all Straddle Returns related
to Income Taxes to Shareholders at least thirty (30) days prior to the due date of such Straddle
Return for Shareholders’ review and approval (which will not be unreasonably withheld, delayed or
conditioned).

          4.1.3. To the extent that the tax year of the Companies and Subsidiaries does not end on the
Closing Date such that the Tax Return is a Straddle Return, the Income Taxes payable on the
Straddle Return shall be allocated between the portion of the period ending on the Closing Date and
the portion of the period beginning after the Closing Date assuming that the taxable period for the
Straddle Return actually included two separate periods, one ending on the Closing Date and one
beginning on the date after the Closing Date, provided that all exemptions, allowances, or
deductions for the entire taxable for the Straddle Return which are calculated on an annual basis
(including, but not limited to, depreciation and amortization deductions) shall be allocated
between the two short periods in proportion to the number of days in each period.

          4.1.4. Access to Information

               (a) From and after the Effective Date, RMO shall grant to Parent (or its designees) access to
the information, books and records relating to the Companies and Subsidiaries (including without
limitation work papers and correspondence with taxing authorities, and shall afford Parent (or its
designees) the right to take extracts therefrom and to make copies thereof for purposes of
preparing Tax Returns, to conduct negotiations with taxing authorities, and to implement the
provisions of, or to investigate or defend any claims between the parties arising under, this
Agreement.

               (b) From and after the Effective Date, Parent shall grant to RMO (or its designees) access to
all of the information, books and records relating to the Companies and Subsidiaries within the
possession of Parent or the Companies and Subsidiaries (including without limitation work papers
and correspondence with taxing authorities), and shall afford RMO (or his designees) the right (at
RMO’s expense) to take extracts therefrom and to make copies thereof, to the extent reasonably
necessary to permit RMO (or his designees) to prepare Tax Returns, to conduct negotiations with
taxing authorities, and to implement the provisions of, or to investigate or defend any claims
between the parties arising under, this Agreement.

21

 

               (c) Each of the parties hereto will preserve and retain all schedules, work papers and other
documents relating to any Tax Returns of or with respect to the Companies or Subsidiaries or to any
claims, audits or other proceedings affecting the Companies or Subsidiaries until the expiration of
the statute of limitations (including extensions) applicable to the taxable period to which such
documents relate or until the final determination of any controversy with respect to such taxable
period, and until the final determination of any payments that may be required with respect to such
taxable period under this Agreement.

          4.1.5. Parent and RMO shall provide (and cause the Companies and Subsidiaries to provide) each
other with such assistance as may reasonably be requested by the other in connection with the
preparation of any Tax Return, any audit or other examination by any taxing authority, or any
judicial or administrative proceedings relating to liabilities for Taxes. Such assistance shall
include making employees available on a mutually convenient basis to provide additional information
or explanation of material provided hereunder and shall include providing copies of relevant tax
returns and supporting material. Parent and RMO will retain (and shall cause the Companies and
Subsidiaries to retain) for the full period of any statute of limitations any documents which may
be relevant to such preparation, audit, examination, proceeding or determination.

          4.1.6. Parent shall pay all federal, state, local, foreign and other transfers, sales, use or
similar tax (a “Transfer Tax”) applicable to, imposed upon or arising out of the transfer
of the shares of the Companies or any other transaction contemplated by this Agreement.

          4.1.7. Contest Provisions.

               (a) Each of Parent, on the one hand, and Shareholders, on the other hand (the “Tax
Indemnified Person”), shall promptly notify the chief tax officer (or other appropriate person)
of Shareholders or Parent, as the case may be (the “Tax Indemnifying Person”), in writing
upon receipt by the Tax Indemnified Person of written notice of any pending or threatened audits,
adjustments, claims, examinations, assessments or other proceedings (a “Tax Audit”) which
are likely to affect the liability for Taxes of such other party, provided, however, that failure
to file timely written notice to the other party shall not affect the other party’s indemnification
obligations hereunder unless such failure materially adversely affects the other party’s rights to
participate in the Tax Audit.

               (b) If such Tax Audit relates to any taxable period, or portion thereof, ending on or before
the Closing Date or for any Taxes for which RMO is liable in full under this Agreement, RMO shall,
at his expense, control the defense and settlement of such Tax Audit. If such Tax Audit relates to
any taxable period, or portion thereof, beginning on or after the Closing Date or for any
Taxes for which Parent is liable in full under this Agreement, Parent shall, at its expense,
control the defense and settlement of such Tax Audit.

               (c) If such Tax Audit relates to Taxes for which both RMO and Parent are liable under this
Agreement, to the extent practicable, such Tax items will be distinguished and each party will
control the defense and settlement of Taxes for which it is so liable. If such Tax Audit relates
to a taxable period, or portion thereof, beginning before and ending after the Closing Date and any
Tax item cannot be identified as being a liability of only one party or

22

 

cannot be separated from a Tax item for which the other party is liable, Parent may either
elect, at its expense, to control the defense and settlement of the Tax Audit or require RMO, at
his expense, to control the defense and settlement of the Tax Audit, provided that such party
defends the items as reported on the relevant Tax Return and provided further that no such matter
shall be settled without the written consent of both parties, not to be unreasonably withheld.

          (d) Any party whose liability for Taxes may be affected by a Tax Audit shall be entitled to
participate at its expense in such defense and to employ counsel of its choice at its expense and
shall have the right to consent to any settlement of such Tax Audit (not to be unreasonably
withheld) to the extent such settlement would have an adverse effect for a period for which that
party is not liable for Taxes, under this Agreement or otherwise.

          4.1.8. All Tax sharing or similar agreements that include RMO and the Companies or
Subsidiaries shall be cancelled prior to the Closing Date such that the Companies or Subsidiaries,
as the case may be, shall have no further rights or obligations under such agreements.

          4.1.9. FIRPTA Certificate. Prior to Closing, Shareholders or the Companies shall
deliver a FIRPTA Certificate to Parent.

          4.2. Employee and Benefit Matters

     4.2.1. Schedule 4.2.1 contains a list of employees who are actively employed by the
Companies or Subsidiaries (including individuals on vacation, short-term disability or similar
leave but excluding those persons on long-term disability leave) on the date hereof who the
parties agree and acknowledge will be treated as employees of the Companies and Subsidiaries for
purposes of this Agreement, which such Schedule 4.2.1 shall be amended as of the Closing
Date to include such employees employed in positions at the Companies and Subsidiaries as of the
Closing Date (“Company Employees”). Schedule 4.2.1 shall also include the amount
of accrued sick leave, flex time and vacation time for each of the Company Employees. From and
after the Closing Date, Parent shall have the right to terminate any or all of Company Employees
at will or to continue the employment of any or all of Company Employees with the Companies and
Subsidiaries upon terms and conditions acceptable to Parent in Parent’s sole and absolute
discretion. Parent shall provide Shareholders with written notification at least three (3) days
prior to the Closing Date of any employee who will be terminated as of the Closing Date. Each
Company Employee who continues employment with the Companies or Subsidiaries as of the Closing
Date shall hereinafter be referred to as a “Transferred Employee.” Shareholders shall
retain and satisfy any and all responsibility, and Parent shall have no liability or
responsibility whatsoever, for any and all claims, liabilities and obligations, whether contingent
or otherwise, relating to (i) any current, former or retired employee of the Companies or
Subsidiaries who is not a Transferred Employee, including, without limitation, any unpaid salary,
wages, bonuses or other compensation or severance pay or benefits, (ii) any Transferred Employee
arising out of or relating to any period, or otherwise incurred, prior to the Closing Date,
including, without limitation, any unpaid salary, wages, bonuses or other compensation or
severance pay, benefits or group health care coverage required by Section 4980B of the Code or
Section 601 of ERISA, and (iii) the Companies

23

 

Plans (such claims, liabilities and obligations, collectively the “Retained Employee
Liabilities”). Parent shall have no obligation to continue the employment of any Transferred
Employee for any period following the Closing Date, and may terminate the employment of any
Transferred Employee at will. Parent shall not receive assets from, nor be required to assume any
of the liabilities of, the Shareholders Plans.

     4.2.2. On the Closing Date, Parent shall assume all liabilities relating to each Transferred
Employee’s unused flexible holiday, vacation and sick time, if any. Schedule 4.2.2
provides the vacation and sick leave policies of NEO and ONG together with accrued vacation and
sick leave as of the date hereof, and Schedule 4.2.2 shall be updated within three (3)
business days of Closing.

          4.3. Guaranties or Bonds

          4.3.1. After the date hereof and prior to the Closing, RMO shall not, and shall cause the
Company or Subsidiaries not to, without the prior written consent of Parent, (a) enter into, issue
or obtain any Guaranty or Bond (each individually, a “New Guaranty or Bond”), or (b) amend
or otherwise modify any Guaranty or Bond; provided, however, that Parent shall not
unreasonably withhold, delay or condition its consent to any New Guaranty or Bond which is entered
into in the Ordinary Course of Business, and Parent shall not unreasonably withhold, delay or
condition its consent to any amendment or other modification of any Guaranty or Bond in the
Ordinary Course of Business if such amendment or other modification would not result in a breach of
any provision of this Agreement; and

          4.3.2. RMO shall promptly provide Parent with a true and correct copy of any New Guaranty or
Bond or amendment or other modification to a Guaranty or Bond.

          4.4. Agreement Not to Solicit Employees

     Unless otherwise consented to in writing by Parent, Shareholders agree that during the
Restricted Period, neither RMO nor any Non-Company Affiliate will solicit or hire away any
Transferred Employee.

          4.5. Insurance Claims

     RMO shall be solely responsible for the administration and, to the extent applicable, payment
of any Property and Casualty Claims with a date of occurrence prior to the Closing, and hereby
releases Parent, the Companies, Subsidiaries, and their Affiliates of any responsibility or
liability therefor. Parent shall be solely responsible for the administration and, to the extent
applicable, payment of any Property and Casualty Claims with a date of occurrence on or after the
Closing, and hereby releases Shareholders of any responsibility or liabilities therefor. For
purposes hereof, “Property and Casualty Claims” shall mean workers’ compensation, auto liability,
general liability, products liability, professional liability, fiduciary liability, pollution
liability and director and officer liability claims relating to the business of the Companies and
Subsidiaries and claims for damages caused to facilities of the Companies or Subsidiaries generally
insured under causes-of-loss — special form property and boiler and machinery insurance coverage,
in each case including reported claims and incurred but not reported claims. RMO shall be solely
responsible for the administration and payment of all costs associated with

24

 

claims for workers’ compensation and other occupational health or injury claims of employees
the Companies and Subsidiaries prior to the Closing Date and for any claim filed subsequent to the
Closing Date made in connection with any injury, event or occurrence taking place prior to the
Closing Date.

	5.	 	REPRESENTATIONS AND WARRANTIES OF RMO REGARDING THE COMPANIES AND SUBSIDIARIES
	 
	 	 	RMO represents and warrants to Parent that:

	          5.1. Organization and Good Standing of the Companies and Subsidiaries; Foreign
Qualifications

          5.1.1. Lightning, Great Plains, BGC and the Subsidiaries are corporations duly incorporated,
validly existing and in good standing under the laws of the State of Ohio, USA, and each has all
requisite corporate power and authority to carry on its business as such business is currently
conducted.

          5.1.2. The Companies and Subsidiaries are duly licensed, registered and qualified to do
business as a foreign corporation, and are in good standing in all jurisdictions in which the
ownership, leasing or operation of their assets or the conduct of their business as currently
conducted requires such qualification under applicable Law.

          5.1.3. Shareholders have heretofore made available to Parent true, correct and complete copies
of the Organizational Documents, each as amended to the date hereof, of the Companies and
Subsidiaries.

          5.2. Capitalization of the Companies and Subsidiaries

          5.2.1. As of the date of this Agreement, the authorized capital stock of Lightning consists of
1,000,000 shares of common stock, $0 par value per share, of which 750 shares are issued and
outstanding. The authorized capital stock of Great Plains consists of 2,000,000 shares of common
stock, $0 par value per share, of which 300 shares are issued and outstanding. The authorized
capital stock of BGC consists of 750 shares of common stock, $0 par value per share, of which 100
shares are issued and outstanding. The authorized capital stock of ONG consists of 5,000 shares of
common stock, $0 par value per share, of which 2,100 shares are issued or outstanding. The
authorized capital stock of NEO consists of 750 shares of common stock, $0 par value per share, of
which 300 shares are issued or outstanding. The Shares (a) constitute all of the issued and
outstanding shares of capital stock of the Lightning, Great Plains, and BGC, (b) are validly
authorized and issued, fully paid, and nonassessable, and (c) will as of Closing be owned
beneficially and of record entirely by Shareholders as set forth in Schedule 5.2.1. No
shares were issued in violation of any preemptive, right of first refusal or other subscription
rights of any shareholder of Lightning, Great Plains, BGC, or any other Person, and all Shares were
offered and sold in compliance with all applicable federal, state and provincial securities Laws.
There are no outstanding options, warrants, calls, commitments or plans by the Companies to issue
any additional shares of its capital stock, or to pay any dividends on such shares, or to purchase,
redeem or retire any outstanding shares of their capital stock, nor are there outstanding

25

 

any securities or obligations which are convertible into or exchangeable for any shares of
capital stock of the Companies or membership units as the case may be. There are no stock
appreciation rights, phantom stock or similar rights in existence with respect to the Companies or
Subsidiaries. No Person other than Shareholders owns or otherwise has any rights to any equity
securities of the Companies.

          5.2.2. Lightning owns one hundred percent (100%) of the issued and outstanding equity
interests in ONG and Great Plains owns one hundred percent (100%) of the outstanding equity
interests of NEO. All of such issued and outstanding equity interests were duly authorized for
issuance and were not issued in violation of any preemptive, first refusal or other subscription
rights, and all equity interests in the Subsidiaries were offered and sold in compliance with all
applicable federal, state and provincial securities Laws. There are no outstanding options,
warrants, calls, commitments or plans by the Subsidiaries to issue any additional equity interests,
or to pay any dividends on such equity, or to purchase, redeem or retire any outstanding equity
interests, nor are there outstanding any securities or obligations which are convertible into or
exchangeable for any equity interest in the Subsidiaries. No person other than the Companies own
or otherwise has any rights to any equity interests in the Subsidiaries.

          5.2.3. Neither the Companies nor the Subsidiaries own, directly or indirectly, any capital
stock or other equity interest in any corporation, partnership, joint venture, limited liability
company or partnership, association or other legal entity.

          5.3. Financial Statements; Undisclosed Liabilities 

          5.3.1. Attached hereto as Schedule 5.3.1 are true, correct and complete copies of the
Financial Statements which have been generated in accordance with the books and records of the
Companies and Subsidiaries. Except as set forth in Schedule 5.3.1, the Financial
Statements (a) have been prepared in material accordance with GAAP, and (b) fairly and accurately
present in all material respects the financial position and the results of operations of the
Companies and the Subsidiaries on a consolidated, pro forma basis as of the dates and for the
periods indicated in accordance with GAAP.

          5.3.2. Neither the Companies nor the Subsidiaries have any material liability or obligation
that would be required to be disclosed on a balance sheet prepared in accordance with GAAP, except
for the liabilities and obligations of the Companies and Subsidiaries (a) disclosed or reserved
against in the Financial Statements and the Assumed Debt as set forth on Schedule 5.3.2.1,
(b) set forth in Schedule 5.3.2.2, or (c) incurred or accrued in the Ordinary Course of
Business since December 31, 2008.

          5.4. Taxes

     Except as provided in Schedule 5.4: (i) the Companies and the Subsidiaries have timely
extended or filed all Tax Returns known to the Companies or the Subsidiaries to be required to be
filed for the Companies or the Subsidiaries on a separate basis and all such Tax Returns are true,
correct and complete in all material respects; (ii) the Companies and the Subsidiaries have paid,
and until the Effective Time will, within the time and in the manner prescribed by Law,

26

 

pay, (or have established adequate reserves on their books and records amounts for) all Taxes
known to the Companies or the Subsidiaries to be due and payable in respect of such Tax Returns
except those being contested in good faith; (iii) the Companies and the Subsidiaries have withheld
all amounts known to the Companies or the Subsidiaries to be required to be withheld from payments
to employees and other third parties and have remitted such amounts to the appropriate taxing
authority in accordance with applicable Laws; (iv) neither the Companies nor the Subsidiaries have
executed or filed with any taxing authority (whether federal, state, local or foreign) any
agreement or other document (other than normal requests to extend the time for filing a Tax Return)
extending or waiving or having the effect of extending or waiving the period for assessment of any
Tax that is due with respect to a Tax Return that the Companies or the Subsidiaries are required to
file; (v) no federal, state, local or foreign Tax Audits or other administrative proceeding,
discussions or court proceedings are presently in progress with regard to any Tax Returns of the
Companies or the Subsidiaries; and (vi) there are no Liens for Taxes upon the Assets of the
Companies or the Subsidiaries. For federal Income Tax purposes, Great Plains and Lightning are
treated as “S-corporations” pursuant to Section 1361(a)(1) of the Code, and NEO and ONG are treated
as “Qualified Subchapter S-subsidiaries” pursuant to Section 1361(b)(3).

          5.5. Tangible Personal Property

          5.5.1. Schedule 5.5.1 sets forth a list of all Tangible Personal Property with a cost
greater than Five Thousand Dollars ($5,000.00) owned by the Companies or Subsidiaries. Except as
set forth in Schedule 5.5.1, the Companies and Subsidiaries have good and valid title (or,
in the case of leased Tangible Personal Property, a good and valid leasehold interest) to all of
the Tangible Personal Property used in the operation of the business of the Companies and
Subsidiaries as currently conducted, in each case free and clear of any material lien except
Assumed Debt.

          5.5.2. All of the Accounts Receivable shown on the Financial Statements and the Accounts
Receivable constituting a part of the Assets arose in the Ordinary Course of Business in connection
with bona fide transactions. Schedule 5.5.2 reflects the procedures the Companies use to
collect their Accounts Receivable.

          5.6. Agreement Related to Other Instruments; Consents

     The execution, delivery and performance by Shareholders and the Companies of this Agreement
and the other documents, instruments and agreements to be entered into by Shareholders and the
Companies pursuant hereto do not and will not, and the consummation of the transactions
contemplated hereby and thereby will not, conflict with or violate any provision of the
Organizational Documents of each Company and Subsidiary.

          5.7. Absence of Changes

     Since December 31, 2008 through the Effective Date, the Companies and Subsidiaries have not,
except as set forth in Schedule 5.7 or in the Ordinary Course of Business:

               (a) transferred, assigned or conveyed any material Assets;

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               (b) suffered any material destruction, damage or loss to any material Assets (casualty or
other), whether or not covered by insurance;

               (c) except as described in Schedule 5.12 or Schedule 3.2(k), entered into any
Material Contract;

               (d) except as described in Schedule 5.12 or Schedule 3.2(k), terminated or
amended or suffered the termination or amendment of, failed to perform in all material respects its
obligations under, or suffered or permitted any Default to exist under, any Material Contract or
Real Property Lease;

               (e) caused or consented to the imposition of a material Lien on any Asset except for the
Assumed Debt;

               (f) made any distributions to Shareholders in the form of the return of capital, dividends or
cash distributions;

               (g) incurred or assumed any indebtedness for borrowed money or issued any debt security except
as set forth in Schedule 5.12;

               (h) waived any material right of the Companies or Subsidiaries or cancelled any debt or claim
held by the Companies or Subsidiaries;

               (i) made any loan to any officer, director, employee or shareholder of the Companies or
Subsidiaries;

               (j) increased, directly or indirectly, the compensation paid or payable to any officer,
director, employee or agent of the Companies or Subsidiaries except in accordance with Section
3.2(j) hereof;

               (k) hired or fired any employees of the Companies or Subsidiaries or changed any such
employee’s terms or conditions of employment except in accordance with Section 3.2 hereof;

               (l) taken or suffered any other act that may reasonably be expected to cause or result in a
Material Adverse Effect;

               (m) received any adverse ruling or denial of any request by any Governmental Authority,
including but not limited to the MPSC, WPSC, PPUC, or PUCO; or

               (n) agreed to do any of the foregoing items of this Section 5.7.

          5.8. Material Claims

     Except as set forth in Schedule 5.8, there is no litigation, suit, action, proceeding
or claim pending or, to the knowledge of Shareholders or Shareholders’ counsel, any basis therefore
or threat thereof against the Companies or Subsidiaries that would be reasonably expected to result
in a Material Adverse Effect on the Company, Subsidiaries or Assets. Except as set forth in

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Schedule 5.8, there is no judgment, decree, injunction, order, determination, award,
finding or letter of deficiency of any Governmental Authority or arbitrator outstanding with
respect to the Agreement or against the Companies or Subsidiaries or any of the Assets, except for
existing tariffs issued by the PUCO.

          5.9. Permits; Compliance With Laws

     Except as set forth in Schedule 5.9 and for Environmental Matters, which are addressed
exclusively in Section 5.17, to Shareholders’ knowledge the Companies or Subsidiaries
possess all Permits that are required under applicable Law for the ownership or operation of the
business of the Companies or Subsidiaries as currently conducted, to Shareholders’ knowledge all
such Permits are in full force and effect, and to Shareholders’ knowledge the Companies and
Subsidiaries are in compliance with all of the terms and conditions of such Permits. No proceeding
is pending or, to Shareholders’ knowledge, threatened seeking the revocation, cancellation,
non-renewal or limitation, in whole or in part, of any such Permit. Neither the Companies nor the
Subsidiaries have received any written notice from any Governmental Authority alleging violation of
any applicable Law. 

          5.10. Real Property

          5.10.1. The Companies and Subsidiaries do not own any fee simple interest in real property
other than the real property, buildings and improvements described in Schedule 5.10.1. The
Companies owns good, valid and marketable fee simple title to such real property, free and clear of
any Lien other than the Mortgage or any other Liens that, individually or in the aggregate, could
not materially adversely affect the function of such property in connection with its use in the
Ordinary Course of Business. Except as set forth on Schedule 5.10.1 and except for
easements, conditions and other conditions of record, no part of such real property is subject to
any assignment, lease, license, sublease or other agreement granting to any Person any right to the
possession, use, occupancy or enjoyment of such property. All such real property complies in all
material respects with all federal, state, provincial and local Laws and all applicable private
restrictions.

          5.10.2. RMO has heretofore delivered to Parent true, correct and complete copies of all leases
(including all amendments thereto) of real property currently leased by the Companies or
Subsidiaries, a list of which is set forth in Schedule 5.10.2 (collectively, the “Real
Property Leases”). Each Real Property Lease is valid and binding on the Companies or
Subsidiaries that is a party thereto, and on the other parties thereto, and is enforceable against
the Companies and Subsidiaries and the other parties thereto in accordance with the terms thereof,
except as enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance,
fraudulent transfer, reorganization, moratorium, applicable equitable principles or other similar
Laws from time to time in effect affecting the enforcement of creditors’ rights generally. Except
as described in Schedule 5.10.2, the Companies and Subsidiaries have performed all material
obligations required to be performed by them to date under all such Real Property Leases, and
neither the Companies, Subsidiaries, nor any other party thereto is in Default under any of the
Real Property Leases. Except as set forth in Schedule 5.10.2 and to the knowledge of RMO,
no part of the property leased pursuant to a Real Property Lease is subject to any assignment,
lease,

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license, sublease, or other agreement granting to any Person other than as specified in such
Real Property Lease any right to the possession, use, occupancy or enjoyment of such leased
property.

          5.10.3. The real property listed in Schedules 5.10.1 and 5.10.2 shall collectively be
referred to herein as the “Real Property”. The Real Property includes all of the Real
Property used by the Companies and Subsidiaries in their business operations. To Shareholder’
knowledge, all improvements to the Real Property are located within the boundary lines of the Real
Property, and no structure, fixture, facility or improvement on any parcel adjacent to the Real
Property encroaches onto any portion of the Real Property. To Shareholders’ knowledge, the
Companies and Subsidiaries have good and valuable rights of physical and legal ingress and egress
to and from the Real Property from and to the public systems for all usual streets, roads and
utility purposes, and to Shareholders’ knowledge no condition exists that would reasonably be
expected to result in the termination of such ingress and egress. Except as set forth in
Schedule 5.10.3 to Shareholders’ knowledge the Real Property and any present or proposed
use of the Real Property comply with all applicable Laws and all covenants, conditions,
restrictions and similar matters affecting or applicable to the Real Property. To Shareholders’
knowledge, the Companies or Subsidiaries have obtained all Permits from Governmental Authorities
(including certificates of use and occupancy, licenses and other Permits), required in connection
with the construction, repair, maintenance, ownership, use and occupation of the Real Property.
To Shareholders’ knowledge, there are no pending, or threatened condemnation, fire, health,
safety, building or other land use regulatory proceedings, lawsuits or administration actions
related to any portion of the Real Property and neither the Companies nor the Subsidiaries have
received written notice of any pending or threatened special assessment proceedings affecting any
portion of the Real Property. Except for real property taxes with respect to the tax period in
which the Closing Date occurs, all real property taxes (and applicable penalties and interest, if
any) that are due and payable with respect to the Real Property have been paid or will be paid at
or prior to the Closing Date. There are no outstanding options, rights of first offer, rights of
refusal or similar contracts or rights to purchase the Real Property or any portion thereof or
interest therein. No work, repairs, installation, construction or other services have been
performed on any of the Real Property or materials supplied to the Real Property in the four (4)
month period prior to the Closing Date that could give rise to a materialmen’s, mechanic’s, repair
man’s, contractor’s, tax or other similar lien, or if such work, repairs, installation,
construction or other services have been performed on any of the Real Property or materials
supplied to the Real Property, all providers of such work or materials have been paid in full.

          5.11. Intellectual Property; Software

          5.11.1. Schedule 5.11.1 sets forth a list of all issued Patents and registered
copyrights, trademarks, service marks and trade names owned or licensed by the Companies and
Subsidiaries and currently used in conducting their respective businesses in the United States or
any foreign country, and the annual licensing fee to be paid by the Companies or Subsidiaries for
the use of such Intellectual Property, if any. The Companies and Subsidiaries own, or have the
license or right to use in the United States and in any foreign country in which they conduct
business, all Intellectual Property currently used and necessary to conduct the business of the
Companies and Subsidiaries as presently conducted, in each case in the United States and in each
foreign country where the Companies use such Intellectual Property.

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          5.11.2. Schedule 5.11.2(a) sets forth a list of all Software owned or licensed by the
Companies and Subsidiaries, and Schedule 5.11.2(b) sets forth a list of all Software owned
or licensed by any Non-Company Affiliate, which is currently used in conducting any Company or
Subsidiary business in the United States or any foreign country. Schedules 5.11.2(a) and
5.11.2(b) also set forth the annual licensing fee owed by the Companies or Subsidiaries to
utilize said Software. The Companies and Subsidiaries own, or have the license or right to use all
such Software currently used and necessary to conduct the business of the Companies or Subsidiaries
as presently conducted, in each case in the United States and in each foreign country where the
Companies or Subsidiaries use such Software.

          5.11.3. To the knowledge of Shareholders, (a) no Third Party is infringing upon, violating or
interfering with or otherwise engaging in the unlawful appropriation of any right, title, interest
of or the goodwill associates with any Intellectual Property which is owned by any Company or
Subsidiary, and (b) within the last three years no Company or Subsidiary nor any of the Affiliates
has brought or threatened a claim against any Third Party alleging that or otherwise has reason to
believe that any Intellectual Property owned by any Company, Subsidiary or any of the Affiliates is
being infringed upon, violated or interfered with or unlawfully appropriated.

          5.12. Material Contracts

          5.12.1. Schedule 5.12 sets forth a true, correct and complete list, as of the date
hereof, of all material Contracts (other than Real Property Leases and other than those material
Contracts which will be superseded by the Contracts listed in Schedule 3.2) of the
following categories (collectively, the “Material Contracts”):

               5.12.1.1. any Contract (including any confidentiality agreements) between the Companies or
Subsidiaries and one or more Major Customers;

               5.12.1.2. any Contract that by its terms limits or otherwise restricts each Company from
engaging or competing in any line of business or in any geographic area;

               5.12.1.3. any partnership agreement, joint venture agreement or non-wholly-owned limited
liability company operating agreement;

               5.12.1.4. any Contract evidencing the transportation agreements between BGC, NEO, and ONG, on
one hand, and Cobra Pipeline Company, Ltd. and Orwell-Trumbull Pipeline Company, LLC, on the other
hand;

               5.12.1.5. any Contracts evidencing the marketing agreements between BGC, NEO and ONG, on one
hand, and ONG Marketing, Inc., John D. Oil and Gas Marketing Company, LLC and NEO Gas Marketing,
LLC, on the other hand.

               5.12.1.6. any guaranty, surety bond or letter of credit issued or posted, as applicable, by
the Companies or Subsidiaries in which the Companies or Subsidiaries are the guarantor, indemnitor
or reimbursing party, as applicable;

               5.12.1.7. any agreement requiring payment to any Person of a commission or fee other than in
the Ordinary Course of Business;

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               5.12.1.8. any distributor, sales representative, independent contractor or similar
agreement;

               5.12.1.9. any agreement under which the Companies, the Subsidiaries or any of their officers
or directors are restricted from carrying on any business, or competing in any line of business, in
the State where any Company or Subsidiary does business;

               5.12.1.10. any indenture, trust agreement, loan agreement or note to which a Company or
Subsidiary is a party that involves or evidences outstanding indebtedness, obligation or
liabilities for borrowed monies;

               5.12.1.11. any agreement for the disposition of a material portion of any Company’s or
Subsidiary’s Assets (other than the sale of inventory in the Ordinary Course of Business);

               5.12.1.12. any stand-alone indemnification agreement providing for indemnification obligations
on the part of the Companies or Subsidiaries;

               5.12.1.13. any agreement for the acquisition of any of the properties, securities or other
ownership interest of the Companies or Subsidiaries or the grant to any Person of any options,
rights of first refusal, exclusive negotiation or preferential similar rights to purchase any of
such Assets, properties, securities or other ownership interest; and

               5.12.1.14. any commitment or agreement to enter into or post any of the foregoing items of
this Section 5.12.1.

          5.12.2. For purposes of Section 5.12.1 above, a contract will be deemed “material” if it
obligates the Company or Subsidiaries to a liability in excess of Ten Thousand Dollars
($10,000.00).

          5.12.3. As of the date of this Agreement, Shareholders have made available to Parent true,
correct and complete copies of all written Material Contracts. Each Material Contract is in full
force and effect, and is valid and binding on the Companies and Subsidiaries, the other parties
thereto, and is enforceable against the Companies and Subsidiaries and the other parties thereto in
accordance with the terms thereof, except as enforceability may be limited by bankruptcy,
insolvency, fraudulent conveyance, fraudulent transfer, reorganization, moratorium, applicable
equitable principles or similar laws from time to time in effect affecting the enforcement of
creditors’ rights generally. Except as set forth in Schedule 5.12, to Shareholders’
knowledge the Companies and Subsidiaries have performed all material obligations required to be
performed by them to date under such Material Contract, and to Shareholders’ knowledge neither the
Companies, Subsidiaries, nor any other party thereto is in Default under such Material Contract,
nor to Shareholders’ knowledge does any condition exist that with notice or lapse of time would
constitute a Default thereunder. No surety bond or letter of credit that constitutes a Material
Contract has been called or drawn upon.

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          5.13. Labor Matters

     Except as set forth on Schedule 5.13, within the last three (3) years, (a) the
Companies and Subsidiaries have not been the subject of any union activity, nor has there been any
strike of any kind called against the Companies or the Subsidiaries, nor has there been any lockout
or work stoppage involving the Companies or Subsidiaries, and (b) the Companies and Subsidiaries
have not violated any applicable federal, state or provincial Law relating to labor or labor
practices. Except as set forth on Schedule 5.13, neither the Companies nor the
Subsidiaries are a party to any collective bargaining agreement.

          5.14. ERISA and Related Matters

          5.14.1. Schedule 5.14 sets forth a true, correct and complete list, as of the date
hereof, of all Company Plans. Shareholders have made available to Parent true, correct and
complete copies of the most recent summary plan descriptions, if any, with respect to the Company
Plans.

          5.14.2. The Companies and Subsidiaries do not contribute or have any obligation to contribute,
and have not within six (6) years prior to the date of this Agreement contributed or had an
obligation to contribute, to a multiemployer plan (within the meaning of Section 3(37) of ERISA) or
a Benefit Plan (other than a Shareholders Plan) subject to Title IV of ERISA, Section 302 of ERISA
or Section 412 of the Code.

          5.14.3. With respect to any “employee benefit plan,” within the meaning of Section 3(3) of
ERISA, that is not a Company Plan, and which is sponsored, maintained, or contributed to, or has
been sponsored, maintained, or contributed to within six (6) years prior to the date of this
Agreement, by the Companies and Subsidiaries or any corporation, trade, business, or entity under
common control with the Companies and Subsidiaries, within the meaning of Section 414(b), (c), or
(m) of the Code or Section 4001 of ERISA, to Shareholders’ knowledge: (a) no withdrawal liability,
within the meaning of Section 4201 of ERISA, has been incurred, which withdrawal liability has not
been satisfied, (b) no liability to the Pension Benefit Guaranty Corporation has been incurred by
any such entity, which liability has not been satisfied, (c) no accumulated funding deficiency,
whether or not waived, within the meaning of Section 302 of ERISA or Section 412 of the Code has
been incurred, and (d) all contributions (including installments) to such plan required by Section
302 of ERISA and Section 412 of the Code have been timely made.

          5.14.4. In connection with the consummation of the transactions contemplated by this
Agreement, to Shareholders’ knowledge no payments of money or other property, acceleration of
benefits, or provision of other rights have been or will be made hereunder, under any agreement
contemplated herein, or under any Company Plan that would be reasonably likely to be nondeductible
under Section 280G of the Code, whether or not some other subsequent action or event would be
required to cause such payment, acceleration, or provision to be triggered.

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          5.15. Guaranties or Bonds

     Schedule 5.15 sets forth a true, correct and complete list, as of the date hereof, of
all Guaranties or Bonds.

          5.16. Employees

     Except as set forth on Schedule 5.16, the Companies and Subsidiaries do not have any
written or oral contract with any individual currently engaged, or previously engaged, in the
business of the Companies or Subsidiaries as an employee, independent contractor or otherwise.
Schedule 5.16 sets forth a true, correct and complete list, as of the date(s) set forth
therein, of the names, position and initial employment date of all current employees of the
Companies and Subsidiaries. No changes in such base pay for such employees have been promised or
authorized by the Companies or Subsidiaries, except in the Ordinary Course of Business or except as
described in Schedule 5.16. Except as set forth in Schedule 5.16, there are no
loans or other obligations payable or owing by the Companies or Subsidiaries to any officer,
director or employee of the Companies or Subsidiaries, except salaries, wages, vacation pay,
bonuses and salary advances and reimbursement of expenses incurred and accrued in the Ordinary
Course of Business, nor are any loans or debts payable or owing by any such individuals to the
Companies or Subsidiaries, nor have the Companies nor the Subsidiaries guaranteed any of such
individuals’ respective loans or material obligations. The Companies and Subsidiaries are not (a)
delinquent in the payment to any of their employees or independent contractors any wages, salaries,
commissions, bonuses or other direct compensation for any services performed by them or amounts
required to be reimbursed to such employees or consultants or any Taxes or any penalty for failure
to comply with any of the foregoing or (b) liable for any payment to any trust or other fund or to
any Governmental Authority, with respect to unemployment compensation benefits, social security or
other benefits or obligations for employees (other than routine payments to be made in the Ordinary
Course of Business and consistent with past practices). Shareholders are not aware and the
Companies and Subsidiaries have not received notice that any employee or independent contractor of
the Companies or Subsidiaries intends to terminate his or her employment relationship or engagement
with the Companies or Subsidiaries. Shareholders are not aware and the Companies and Subsidiaries
have not received notice that any employee, director or officer of the Companies and Subsidiaries
are obligated under any contract or subject to any judgment, decree or administrative order that
would conflict or interfere with (a) the performance of the Person’s duties as an employee,
director or officer of the Companies or Subsidiaries, or (b) the business of the Companies or
Subsidiaries as conducted or proposed to be conducted. Between the Effective Date and the Closing
Date, no more than twenty percent (20%) of the total employees engaged by the Companies or
Subsidiaries shall have resigned, been terminated for any reason, or had their working hours
materially reduced except in the Ordinary Course of Business.

          5.17. Environmental Matters

     Except as set forth in Schedule 5.17 to Shareholders’ knowledge:

          5.17.1. the Companies and Subsidiaries and their respective operations are in material
compliance with all applicable Environmental Laws;

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          5.17.2. the Companies and Subsidiaries are not subject to any pending or threatened claim,
action, suit, investigation, inquiry or proceeding under any Environmental Law and there is no such
action proposed or threatened;

          5.17.3. all Permits, if any, required to be obtained by the Companies and Subsidiaries under
any Environmental Law in connection with their respective operations as they are currently being
conducted, including those relating to the management of Hazardous Substances, have been obtained
by the Companies or Subsidiaries, and are in full force and effect on the date hereof;

          5.17.4. there have been no releases of Hazardous Substances on any real property owned or
leased by the Companies and Subsidiaries in connection with the operations of the Companies or
Subsidiaries that requires remediation under applicable Environmental Laws;

          5.17.5. no real property formerly owned or leased by each Company and Subsidiary in connection
with the operations of the operations and each Company and Subsidiary has been contaminated with
any Hazardous Substances during or prior to such period of ownership or operation which could
reasonably be expected to result in liability relating to or requiring any remediation under the
applicable Environmental Laws;

          5.17.6. no Company or Subsidiary is subject to any order, decree, injunction or other
arrangement with any Governmental Authority or any agreement with any third party pursuant to which
any Company or Subsidiary is indemnifying any third party for liability under any Environmental
Laws; and

          5.17.7. Shareholders and each Company and Subsidiary shall make available to Parent on a
confidential basis all environmental site assessment reports, studies and related documents in the
possession of each Company, Shareholders or any Non-Company Affiliate and relating to environmental
matters in connection with operation of the Assets.

          5.18. Insurance Coverage 

     Schedule 15.18 sets forth a true, correct and complete summary of all Company
Insurance Policies applicable to the Companies and Subsidiaries and any surety bonds (if
applicable) covering the Companies, Subsidiaries, the Assets, the business of the Companies and
Subsidiaries, and the employees of the Companies and Subsidiaries, other than any such insurance
policies related to Benefit Plans. There is no claim by the Companies or Subsidiaries pending
under any such policies or bonds as to which coverage has been questioned, denied or disputed by
the underwriters of such policies and bonds. All premiums due and payable under such policies and
bonds have been paid, and the Companies and Subsidiaries are otherwise in material compliance with
the terms and conditions of all such policies and bonds. To the knowledge of Shareholders, there
is no threatened termination of such policies and bonds.

          5.19. Governmental Filings: No Violations

          5.19.1. Except as disclosed on the attached Schedule 5.19, to Shareholders’ knowledge
no notices, reports or other filings are required to be made by Shareholders, the Companies or
Subsidiaries with, nor are any consents, registrations, approvals, permits or

35

 

authorizations required to be obtained by Shareholders, the Companies or Subsidiaries from,
any Governmental Authority in connection with the execution and delivery of this Agreement by
Shareholders and the consummation of the transactions contemplated hereby, except those that the
failure to make or obtain would not have a Material Adverse Effect.

          5.19.2. Subject to the filings, registrations, consents, approvals, permits, authorizations
and/or notices referred to in Schedule 5.19 and/or in Schedule 6.2, Shareholders’
and each Company’s execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated hereby will not constitute or result in (i) a breach or violation of
any provisions of the Organizational Documents of each Company or Subsidiary, (ii) a breach or
violation of any Law of any Governmental Authority by which each Company is bound or (iii) a breach
or violation of, or a default under, the acceleration of any obligations under, or the creation of
a Lien on the assets of any Company or Subsidiary (with or without notice, lapse of time or both)
pursuant to, any Contract binding upon any Company or Subsidiary, except, in the case of clauses
(ii) and (iii) above, for any breach, violation, default, acceleration or creation that would not
have a Material Adverse Effect.

     Except as disclosed on the attached Schedule 5.19, neither the Shareholders nor the
Companies needs to provide any notice to, or obtain any Permits from any Governmental Authority for
the consummation of the transactions contemplated by this Agreement.

          5.20. Accounts Receivable

     Schedule 5.20 sets forth a true and correct list of all Accounts Receivable of the
Companies and Subsidiaries as of the end of the business day on April 28, 2009. All Accounts
Receivable represent valid obligations and to Shareholders’ knowledge are not subject to any set
offs or counterclaims. All Accounts Receivable and all Accounts Receivable arising between the
Effective Date and the Closing Date are owned by the Companies and Subsidiaries. Except as set
forth in Schedule 5.20, no Account Receivable has been outstanding for more than sixty (60)
days. To Shareholders’ knowledge, the Companies and Subsidiaries have not received written notice
from an account debtor stating that any Account Receivable in an amount in excess of Ten Thousand
Dollars ($10,000.00) is subject to any contest, claim or set off by such account debtor. No
discount or allowance from any Account Receivable has been made or agreed to.

          5.21. Gratuitous Payments

     Neither the Companies, Subsidiaries, nor any of the directors, members, executives,
independent contractors or employees of the Companies or Subsidiaries, nor any agents acting on
behalf of or for the benefit of the Companies or Subsidiaries, directly or indirectly, has (i)
offered or paid any remuneration, in cash or in kind, to, or made any financial arrangements with,
any past or present customers or third party payors of the Companies, Subsidiaries, or potential
customers of the Companies or Subsidiaries in order to obtain business from such customers, other
than standard pricing or discount arrangements consistent with proper legal and business practices,
(ii) given, or agreed to give, or is aware that there has been made, or that there is an agreement
to make, any gift or gratuitous payment of any kind, nature or description (whether in money,
property or services) to any customer, third party payor, supplier, source of financing, landlord,
sub-tenant, licensee or anyone else other than in connection with promotional or

36

 

entertainment activities consistent with proper legal and business practices, (iii) made, or
has agreed to make, or is aware that there has been made, or that there is any agreement to make,
any illegal political contribution or gift, or any contributions, payments or gifts of its funds or
property to, or for the private use of, any governmental official, employee or agent, where either
the contribution, payment or gift or the purpose of such contribution, payment or gift is illegal
under the laws of the United States, or under the laws of any state thereof or any other
jurisdiction (foreign or domestic) under which such payment or gift was made, (iv) established or
maintained any unrecorded fund or asset for any purpose, or has made any false or artificial
entries on any of its books or records for any reason or (v) made, or has agreed to make, or is
aware that there has been made, or that there is any agreement to make, any payments to any person
with the intention or understanding that any part of such payment was to be used for any purpose
other than that described in the documents supporting the payments. No notice or claim
inconsistent with the representations in this Section 5.21 has been received by the
Companies or Subsidiaries.

          5.22. Disclosures

     Neither this Agreement, nor any other agreement entered into pursuant to the transactions
contemplated by this Agreement, nor any schedule, exhibit, report, document, certificate or
instrument prepared by and furnished by the Companies and the Shareholders to Parent or its counsel
in connection with the transactions contemplated by this Agreement contains or will contain any
untrue statement of a material fact or omits or will omit to state a material fact necessary in
order to make the statements contained herein or therein, in light of the circumstances under which
they were made, not misleading except to the extent that any such statement or omission will not be
reasonably likely to have a material effect on the business, financial condition, prospects, or
operation of the Companies, Subsidiaries or Assets.

          5.23. Litigation

     Except as set forth in Schedule 5.8, there is no action, suit or proceeding at law or
in equity against any Company or Subsidiary pending, or to the knowledge of Shareholders,
threatened, which (a) relates to or involves uninsured amounts of more than $5,000, (b) would, if
decided adversely to Shareholders or any Company or Subsidiary, prohibit the transactions
contemplated by this Agreement or (c) is reasonably likely to have a Material Adverse Effect. No
Company or Subsidiary has been permanently or temporarily enjoined or barred by order, judgment or
decree requiring any Company or Subsidiary to take, or refrain from taking, action with respect to
its business.

          5.24. Brokers and Finders

     No broker or finder has been retained or employed by Shareholders or the Companies in
connection with the transactions contemplated in this Agreement. Each Company and Subsidiary does
not have, and will not have, any financial obligation to any broker or finder.

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          5.25. Regulatory Proceedings

     As of the date hereof, neither the Companies nor the Subsidiaries, (a) have rates which have
been or are being collected subject to refund, pending final resolution of any proceeding pending
before a Governmental Authority or on appeal to the Courts or (b) are a party to any proceeding
before a Governmental Authority or on appeal from orders of a Governmental Authority which, in each
case, has resulted or would reasonably be expected to result in orders have a Material Adverse
Effect.

	6.	 	REPRESENTATIONS AND WARRANTIES OF RMO REGARDING SHAREHOLDERS, THE COMPANIES, AND
SUBSIDIARIES AND THE SHARES

     RMO represents and warrants to Parent that except as otherwise set forth in this Agreement:

          6.1. Power and Authority; Enforceability

     Shareholders, the Companies, and the Subsidiaries have all requisite power and authority to
execute and deliver this Agreement and the other documents, instruments and agreements to be
entered into by it pursuant hereto, to perform its obligations hereunder and thereunder, and to
consummate the transactions contemplated hereby and thereby. This Agreement has been duly and
validly executed and delivered by Shareholders and the Companies, and, on the Closing Date, all
other agreements to be entered into by Shareholders and the Companies pursuant hereto will have
been duly and validly executed and delivered by Shareholders and the Companies. This Agreement is,
and each and every agreement, document and instrument provided for herein to be executed and
delivered and to which Shareholders, the Companies, and the Subsidiaries are a party will be, when
executed and delivered by the parties thereto, valid and binding on Shareholders, the Companies,
and the Subsidiaries and enforceable against Shareholders, the Companies, and the Subsidiaries in
accordance with its respective terms, except as enforceability may be limited by applicable
equitable principles or by bankruptcy, insolvency, fraudulent conveyance, fraudulent transfer,
reorganization, moratorium or similar Laws from time to time in effect affecting the enforcement of
creditors’ rights generally.

          6.2. No Violation or Conflict by Shareholders or the
Companies

     Except as set forth in Schedule 6.2, the execution, delivery and performance by
Shareholders and the Companies of this Agreement and each and every other agreement, document and
instrument to be entered into by Shareholders, the Companies, or Subsidiaries pursuant hereto do
not and will not, and the consummation of the transactions contemplated hereby and thereby will
not, constitute an occurrence of a Default or require the consent or approval of any Person under
any provision of any Material Contract to which Shareholders, the Companies, or Subsidiaries are a
party or by which they are bound.

          6.3. Shareholders and the Companies Governmental Approvals

     Except as set forth in Schedule 5.19, the execution, delivery and performance by
Shareholders and the Companies of this Agreement, and the other documents, instruments and
agreements to be entered into by Shareholders, the Companies, or Subsidiaries pursuant hereto,

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do not and will not, and the consummation of the transactions contemplated hereby and thereby
will not (a) violate any consent, judgment, order or decree or any applicable rule or regulation of
any Governmental Authority to which Shareholders, the Companies, Subsidiaries or any Non-Company
Affiliate is a party or is subject to, (b) require of Shareholders, the Companies, Subsidiaries, or
any Non-Company Affiliate a filing or registration with any Governmental Authority, or (c) require
Shareholders, the Companies, Subsidiaries or any Non-Company Affiliate to obtain any consent,
approval, Permit, certificate or order of any Governmental Authority under applicable Law or by any
applicable consent, judgment, order or decree or any applicable rule or regulation of any
Governmental Authority.

          6.4. Title to the Shares of Company Common Stock

     As of the Closing Date, Shareholders will collectively own, beneficially and of record, all of
the shares of Company Common Stock free and clear of any and all Liens except as set forth on
Schedule 6.4. There are no outstanding subscriptions, options, warrants, rights of first
refusal or other agreements or commitments, other than this Agreement, obligating Shareholders to
transfer, or granting an option or right by Shareholders to any Person to purchase or acquire from
Shareholders the Company Common Stock or any other securities of the Companies or Subsidiaries.

          6.5. Litigation Against Shareholders or the Companies

     Except as set forth in Schedule 6.5, to Shareholders’ knowledge there is no
litigation, suit, action, proceeding, claim or investigation pending or, to the knowledge of
Shareholders, proposed or threatened against Shareholders, the Companies, or Subsidiaries that (a)
affects Shareholders, any Non-Company Affiliate, the Companies, Subsidiaries, or the Assets, and
could, individually or in the aggregate, if pursued or resulting in a judgment against
Shareholders, reasonably be expected to materially adversely effect on the ability of Shareholders
to consummate the transactions described herein, or (b) seeks restraint, prohibition, or other
injunctive relief in connection with this Agreement or the consummation of the transactions
contemplated hereby. There is no judgment, decree, injunction, order, determination, award,
finding or letter of deficiency of any Governmental Authority or arbitrator outstanding against
Shareholders, the Companies, or Subsidiaries with respect to this Agreement.

          6.6 Investment

     RMO is receiving the Parent Common Stock as the Merger Consideration pursuant to the exemption
provided by Section 4(2) of the Securities Act of 1933, as amended, and has made, independently and
without reliance on Parent (except to the extent that RMO has relied upon the representations and
warranties of Parent contained herein), his own analysis of Parent Common Stock, and RMO has had
reasonable and sufficient access to such documents and other information and materials as he
considers appropriate to make his necessary evaluation. RMO is acquiring Parent Common Stock
solely for his own account for investment and not with a view to or for the distribution thereof.
RMO acknowledges that Parent Common Stock to be issued to him in connection with the Mergers is not
registered under the Securities Act of 1933, as amended, and that such Parent Common Stock may not
be transferred or sold except pursuant to the registration provisions of the Securities Act of
1933, as amended, or pursuant to an

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applicable exemption therefrom. RMO is able to bear the economic risk of his investment in
Parent Common Stock pursuant to this Agreement, and has sufficient knowledge and experience in
financial and business matters in that he is capable of evaluating the merits and risks of the
acquisition of Parent Common Stock, and RMO is able to financially bear the risk thereof.

6A. REPRESENTATION AND WARRANTIES OF HOWELL, RIGO, WHELAN AND SMITH

          6A.1 Power and Authority; Enforceability

     Each of Howell, Rigo, Whelan and Smith has all requisite power and authority to execute and
deliver this Agreement and the other documents, instruments and agreements to be entered into by
her or him pursuant hereto, to perform her or his obligations hereunder and thereunder, and to
consummate the transactions contemplated hereby and thereby. This Agreement has been duly and
validly executed and delivered by her or him, all other agreements to be entered into by her or him
pursuant hereto will have been duly and validly executed and delivered. This Agreement is, and
each and every agreement, document and instrument provided for herein to be executed and delivered
and to which each of Howell, Rigo, Whelan and Rigo is a party will be, when executed and delivered
by her or him thereto, valid and binding on her or him, and enforceable against each of them in
accordance with its respective terms, except as enforceability may be limited by applicable
equitable principles or by bankruptcy, insolvency, fraudulent conveyance, fraudulent transfer,
reorganization, moratorium or similar Laws from time to time in effect affecting the enforcement of
creditors’ rights generally.

          6A.2 Title to the Shares of Company Common Stock

     As of the Closing Date, each of Howell, Rigo, Whelan and Smith will own, beneficially and of
record, the shares of Company Common Stock, free and clear of any and all Liens, as set forth on
Schedule 5.2.1. There are no outstanding subscriptions, options, warrants, rights of first
refusal or other agreements or commitments, other than this Agreement, obligating any of them to
transfer, or granting an option or right by them to any Person to purchase or acquire from them the
Company Common Stock or any other securities of the Companies or Subsidiaries.

          6A.3 Investment

     Each of Howell, Rigo, Whelan and Smith is receiving the Parent Common Stock as the Merger
Consideration pursuant to the exemption provided by Section 4(2) of the Securities Act of 1933, as
amended, and has made, independently and without reliance on Parent (except to the extent that each
has relied upon the representations and warranties of Parent contained herein), her or his own
analysis of Parent Common Stock, and has had reasonable and sufficient access to such documents and
other information and materials as she or he considers appropriate to make her or his necessary
evaluation. Each of Howell, Rigo, Whelan and Smith is acquiring Parent Common Stock solely for her
or his own account for investment and not with a view to or for the distribution thereof. Each of
Howell, Rigo, Whelan and Smith acknowledges that Parent Common Stock to be issued to her or him in
connection with the Mergers is not registered under the Securities Act of 1933, as amended, and
that such Parent Common Stock may not be transferred or sold except pursuant to the registration
provisions of the Securities Act of 1933, as

40

 

amended, or pursuant to an applicable exemption therefrom. Each of them is able to bear the
economic risk of the investment in Parent Common Stock pursuant to this Agreement, and has
sufficient knowledge and experience in financial and business matters in that she or he is capable
of evaluating the merits and risks of the acquisition of Parent Common Stock, and is able to
financially bear the risk thereof.

	7.	 	REPRESENTATIONS AND WARRANTIES OF PARENT

     Parent represents and warrants to Shareholders and the Companies that:

          7.1. Organization and Standing

     Parent is a corporation duly incorporated, validly existing and in good standing under the
laws of the State of Montana.

          7.2. Corporate Power and Authority; Enforceability

     Parent has all requisite corporate power and authority to execute and deliver this Agreement
and the other documents, instruments and agreements to be entered into by it pursuant hereto, to
perform its obligations hereunder and thereunder, and to consummate the transactions contemplated
hereby and thereby. The execution, delivery and performance by Parent of this Agreement and each
and every other agreement, document and instrument to be executed, delivered and performed by
Parent in connection herewith have been duly authorized and approved by all requisite corporate
action on the part of Parent. This Agreement has been duly and validly executed and delivered by
Parent, and, on the Closing Date, all other agreements to be entered into by Parent pursuant hereto
will have been duly and validly executed and delivered by Parent. This Agreement is, and each and
every agreement, document and instrument provided for herein to be executed and delivered and to
which Parent is a party will be, when executed and delivered by the parties thereto, valid and
binding on Parent, and enforceable against Parent in accordance with their respective terms, except
as enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency,
fraudulent conveyance, fraudulent transfer, reorganization, moratorium or similar Laws from time to
time in effect affecting the enforcement of creditors’ rights generally.

          7.3. No Violation or Conflict by Parent

     Except as set forth in Schedule 7.3, the execution, delivery and performance by Parent
of this Agreement and each and every other agreement, document and instrument to be entered into by
Parent pursuant hereto do not and will not, and the consummation of the transactions contemplated
hereby and thereby will not, conflict with or violate any provisions of the articles of
incorporation or the bylaws of Parent, or constitute an occurrence of Default or require the
consent or approval of any Person under any provision of any contract or agreement to which Parent
is a party or by which it is bound.

          7.4. Parent Governmental Approvals

     Except as set forth in Schedule 7.4, the execution, delivery and performance by Parent
of this Agreement, and the other documents, instruments and agreements to be entered into by

41

 

Parent pursuant hereto, do not and will not, and the consummation of the transactions
contemplated hereby and thereby will not (a) violate any consent, judgment, order or decree or any
rule or regulation of any Governmental Authority to which Parent or any Affiliate of Parent is a
party or is subject to, (b) require of Parent or any Affiliate of Parent a filing or registration
with any Governmental Authority, or (c) require Parent or any Affiliate of Parent to obtain any
consent, approval, Permit, certificate or order of any Governmental Authority under applicable Law
or by any applicable consent, judgment, order or decree or any applicable rule or regulation of any
Governmental Authority.

          7.5. Litigation Against Parent

     There is no litigation, suit, action, proceeding, claim or investigation pending or, to the
knowledge of Parent, proposed or threatened against Parent that (a) affects Parent or any Affiliate
of Parent and could, individually or in the aggregate, if pursued or resulting in a judgment
against Parent or such Affiliate, reasonably be expected to materially adversely effect the ability
of Parent to consummate the transactions described herein, or (b) seeks restraint, prohibition, or
other injunctive relief in connection with this Agreement or the consummation of the transactions
contemplated hereby. There is no judgment, decree, injunction, order, determination, award,
finding or letter of deficiency of any Governmental Authority or arbitrator outstanding against
Parent with respect to this Agreement.

          7.6. Purchase for Investment

     Parent is acquiring the Company Common Stock pursuant to the exemption provided by Section
4(2) of the Securities Act of 1933, as amended, and has made, independently and without reliance on
Shareholders (except to the extent that Parent has relied upon the representations and warranties
of Shareholders contained herein), its own analysis of the Company Common Stock, the Companies and
Subsidiaries and the Assets for the purpose of acquiring the Company Common Stock, and Parent has
had reasonable and sufficient access to such documents and other information and materials as it
considers appropriate to make its necessary evaluation. Parent is acquiring the Company Common
Stock solely for its own account for investment and not with a view to or for the distribution
thereof. Parent acknowledges that the Company Common Stock is not registered under the Securities
Act of 1933, as amended, and that none of the Company Common Stock may be transferred or sold
except pursuant to the registration provisions of the Securities Act of 1933, as amended, or
pursuant to an applicable exemption therefrom. Parent is able to bear the economic risk of its
investment in the Company Common Stock pursuant to this Agreement, and has sufficient knowledge and
experience in financial and business matters in that it is capable of evaluating the merits and
risks of the acquisition of the Company Common Stock, and Parent is able to financially bear the
risk thereof.

          7.7. Knowledge of Inaccuracies 

     Parent shall promptly notify Shareholders and the Companies if at any time prior to the
Closing Parent acquires knowledge of any inaccuracy in any of the representations made by the
Shareholders in this Agreement, provided, however, that Parent’s failure to inform Shareholders
shall not be considered a breach hereunder.

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          7.8. Investigations

     Parent acknowledges that it has been furnished with and has an opportunity to read this
Agreement to which it is a party and all materials relating to the Company, the Subsidiaries and
the Assets that have been requested by Parent. Parent further acknowledges that it has been given
ample opportunity to ask questions and request information of, and receive answers from
Shareholders concerning the Companies, the Subsidiaries and the Assets, including but not limited
to information relating to the business, finances, operations and prospects of the Companies and
the Subsidiaries.

	8.	 	CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT

     The obligations of Parent to consummate the Mergers and the transactions contemplated by this
Agreement shall be subject to the satisfaction, on or before the Closing, of each and every one of
the following conditions, all or any of which may be waived, in whole or in part, by Parent for
purposes of consummating the Mergers and such other transactions:

          8.1. Representations True at the Closing

     The representations and warranties made by RMO or of RMO on behalf of the Companies and
Subsidiaries in this Agreement shall be true and correct in all material respects when made, and
immediately prior to the Closing with the same force and effect as though such representations and
warranties had been made as of such time.

          8.2. Covenants of Shareholders

     Shareholders, the Companies, and Subsidiaries shall have duly performed in all material
respects all of the covenants, acts and undertakings to be performed by them respectively on or
prior to the Closing pursuant to the Agreement, and a duly authorized officer of the Companies and
Subsidiaries, and RMO himself shall have delivered to Parent a certificate in the form attached
hereto as Exhibit A dated as of the Closing Date certifying to the fulfillment of this
condition and the condition set forth in Section 8.1.

          8.3. No Injunction, Etc.

     No action, proceeding, investigation, regulation or legislation shall have been instituted or
threatened by any Person other than Parent or any Affiliate of Parent before any court or
Governmental Authority to enjoin, restrain, or prohibit the consummation of the Mergers or the
transactions contemplated hereby.

          8.4. Consents, Approvals and Waivers

     Shareholders’ and the Companies; execution and delivery of this Agreement and consummation of
the transactions contemplated hereby shall have been approved by (a) all Governmental Authorities,
including the Regulatory Approval, (b) all of Shareholders’ and the Companies’ lenders whose
approval is required under any applicable loan documents, and (c) Parent’s lenders, LaSalle Bank
N.A. and the holders of those current unsecured bond debt notes due June 29, 2017, but only if such
lender approvals are required under the applicable loan

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documents, and no such approvals, independently or in the aggregate, shall have resulted in a
Material Adverse Effect on the regulatory treatment of the Companies or Subsidiaries. In addition,
this Agreement shall have been approved by the special committee of the board of directors of
Parent, the board of directors of Parent (other than Richard M. Osborne in his individual capacity,
and Thomas J. Smith), and Parent’s shareholders. Either (i) Parent shall have received a true,
correct and complete copy of each consent, approval, waiver and agreement required to be obtained
by Shareholders and the Companies no later than the Closing pursuant to Section 3.3, or
(ii) if Shareholders and the Companies were unable to obtain such consent, approval, waiver or
agreement after having complied with their obligations under Section 3.3, Shareholders
shall have obtained for, or provided Parent with, in a form reasonably acceptable to Parent, the
economic practical benefit to Parent as if such consent, approval, waiver or agreement had been
received.

          8.5. Absence of Material Adverse Effect

     No Material Adverse Effect that is not as of the Effective Date hereof contained in a schedule
shall have occurred between the Effective Date and the Closing Date.

          8.6 Consummation of Merger pursuant to the Other Merger Agreement

     The merger and other transactions contemplated by the Other Merger Agreement shall have been
consummated.

	9.	 	CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SHAREHOLDERS AND THE COMPANIES

     The obligations of Shareholders and the Companies to consummate the Mergers and the
transactions contemplated by this Agreement shall be subject to the satisfaction, on or before the
Closing, of each and every one of the following conditions, all or any of which may be waived, in
whole or in part, by Shareholders and the Companies for purposes of consummating the Mergers and
such other transactions:

          9.1. Representations True at Closing

     The representations and warranties made by Parent in this Agreement shall be true and correct
in all material respects when made, and immediately prior to the Closing with the same force and
effect as though such representations and warranties had been made on and as of such time.

          9.2. Covenants of Parent

     Parent shall have duly performed in all material respects all of the covenants, acts and
undertakings to be performed by it on or prior to the Closing pursuant to the Agreement, and the
President of Parent shall have delivered to Shareholders and the Companies a certificate in the
form attached hereto as Exhibit B dated as of the Closing Date certifying to the
fulfillment of this condition and the condition set forth in Section 9.1.

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          9.3. No Injunction, Etc.

     No action, proceeding, investigation, regulation or legislation shall have been instituted or
threatened by any Person other than Shareholders, the Companies, Subsidiaries, or any Non-Company
Affiliate before any court or Governmental Authority to enjoin, restrain or prohibit the
consummation of the Mergers and the transactions contemplated hereby.

          9.4. Consents, Approvals and Waivers

     Parent’s execution and delivery of this Agreement and the consummation of the Mergers and the
transactions contemplated hereby shall have been approved by (a) the special committee of the board
of directors of Parent, the board of directors of Parent (other than Richard M. Osborne in his
individual capacity, and Thomas J. Smith), and approval by Parent’s shareholders, (b) all
Governmental Authorities whose approvals are required by Law, (c) Parent’s lenders, LaSalle Bank
N.A. and the holders of those current unsecured bond debt notes due June 29, 2017, but only if such
lender approvals are required under the applicable loan documents, and (d) all of Shareholders’ and
the Companies’ lenders whose approval is required under any applicable loan documents. Shareholders
and the Companies shall have received a true, correct and complete copy of each consent, approval,
waiver and agreement required to be obtained by Parent no later than the Closing pursuant to
Section 3.3. Shareholders’ and the Companies’ execution and delivery of this Agreement and
the consummation of the Mergers and the transactions contemplated hereby shall have been approved
by all Governmental Authorities whose approvals are required by Law, except for any such approval
which could not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect on the ability of Shareholders and the Companies to consummate the Mergers and the
transactions described herein.

          9.5 Consummation of Merger pursuant to the Other Merger Agreement

     The merger and other transactions contemplated by the Other Merger Agreement shall have been
consummated.

	10.	 	TRANSACTIONS AT CLOSING

          10.1. Transactions at Closing

     At the Closing, each of the following shall occur:

          10.1.1. Shareholders’ and the Companies’ Performance. At the Closing, Shareholders
and the Companies shall deliver to Parent each of the following:

               10.1.1.1. all certificates representing the Company Common Stock or, if applicable,
replacement certificates together with lost certificate affidavits and indemnifications (in form
and substance reasonably acceptable to Parent), duly endorsed for transfer or accompanied with
executed blank stock powers (in form and substance reasonably acceptable to Parent), together with
a new certificate representing such shares issued in the name of Parent;

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               10.1.1.2. original stock ledgers, articles of incorporation, certificates of incorporation,
charters, certificates of formation, bylaws, joint venture agreements, partnership agreements,
limited liability company operating agreements, and board of directors’, shareholders’ and members’
minutes of the Companies and Subsidiaries;

               10.1.1.3. the certificate of Shareholders as described in Section 8.4;

               10.1.1.4. evidence of the consents, approvals, waivers and agreements described in
Section 8.4 in a form reasonably satisfactory to Parent;

               10.1.1.5. certificates of existence or good standing of the Companies and Subsidiaries, as
of the most recent practicable date, from the appropriate Governmental Authority of the
jurisdiction of their respective incorporations or formations and the jurisdictions in which each
is qualified to do business;

               10.1.1.6. resignations, or evidence of termination of his or her office, by each director,
manager, and officer of the Companies and Subsidiaries, unless otherwise agreed by the parties;

               10.1.1.7. such other evidence of the performance of all covenants and satisfaction of all
conditions required of Shareholders or the Companies by this Agreement, at or prior to the Closing,
as Parent may reasonably require;

               10.1.1.8. all books and records relating to the operation of the Companies and Subsidiaries,
including but not limited to all such electronic records, files, ledgers and other documentation
reasonably required by Parent in connection with the ongoing operation of the Companies and
Subsidiaries; and

               10.1.1.9. any acknowledgments or consents of any lender’s of Assumed Debt.

     10.1.2. Parent’s Performance. At the Closing, Parent shall deliver to Shareholders
each of the following:

               10.1.2.1. the certificate of the President of Parent described in Section 9.2;

               10.1.2.2. certificates of existence or good standing of Parent and the Acquisition Subs, as
of the most recent practicable date, from the appropriate Governmental Authority of the
jurisdiction of its incorporation;

               10.1.2.3. Secretary or Assistant Secretary certified copies of resolutions of the board of
directors of Parent approving the transactions contemplated by this Agreement;

               10.1.2.4. Secretary or Assistant Secretary certificates of incumbency for the officers of
Parent who sign on behalf of Parent this Agreement and any other documents, instruments or
agreements to be entered into by Parent pursuant hereto;

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               10.1.2.5. such other evidence of the performance of all covenants and satisfaction of all
conditions required of Parent by this Agreement, at or prior to the Closing, as Shareholders or the
Companies may reasonably require; and

               10.1.2.6. a receipt of Parent evidencing Parent’s receipt of the Company Common Stock.

11. SURVIVAL OF REPRESENTATION AND WARRANTIES; INDEMNIFICATION

          11.1. Survival of Representations, Warranties and Agreements

               11.1.1. All representations, warranties, covenants, indemnities and obligations made or
undertaken by Shareholders in this Agreement are material, have been relied upon by Parent and
shall survive the Closing hereunder as set forth in Section 11.5, and shall not merge in
the performance of any obligation by any party hereto.

               11.1.2. All representations, warranties, covenants, indemnities and obligations made or
undertaken by Parent in this Agreement are material, have been relied upon by Shareholders and
shall survive the Closing hereunder as set forth in Section 11.5, and shall not merge in
the performance of any obligation by any party hereto.

          11.2. Agreements to Indemnify Parent Indemnitees

               11.2.1. Subject to the other provisions of this Section 11 and subject to Section
5.25, RMO hereby agrees to indemnify and hold harmless Parent, each Affiliate of Parent, their
respective directors and officers, and their respective successors and assigns (collectively,
“Parent Indemnitees”), from and against any and all liability, obligation, loss, Lien,
damage, injury, cost and expense (including reasonable attorneys’ fees and costs and expenses
related thereto) (collectively, “Losses”) suffered or incurred by any Parent Indemnitee
arising from: (a) any material breach of any indemnity, covenant, representation or warranty of
Shareholders contained in this Agreement, (b) any misrepresentation in the certificate delivered at
the Closing pursuant to Section 8.2, (c) the Shareholders Plans, (d) all Taxes of the
Companies and Subsidiaries (including Taxes of any other Person for which the Companies or
Subsidiaries is liable under Treasury Regulation section 1.1502-6 or similar provision of foreign,
state or local law) for periods (or portions thereof) ending on or prior to the Closing Date to the
extent such Taxes exceed the Accrued Tax Liability; or (e) any Scheduled Claim, which claims the
parties acknowledge and agree that Shareholders have acknowledged their duty to defend in
accordance with Section 11.6.2 and, thereby, Shareholders have a right to control the
defense of in accordance with the provisions of Section 11.6.2

               11.2.2. For all purposes of this Section 11, after the Closing, any Loss suffered or
incurred by the Companies or Subsidiaries arising from any breach of any indemnity, covenant,
representation or warranty by RMO referenced in Section 11.2.1 shall be deemed suffered and
incurred by Parent for purposes of such Section 11.2.1, and Parent shall be entitled to
seek indemnification under such Section 11.2.1 against RMO alone for any such Loss.

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          11.3. Agreements to Indemnify the Shareholders Indemnitees

     Subject to the other provisions of this Section 11, Parent hereby agrees to indemnify
and hold harmless Shareholders, each Non-Company Affiliate, their respective directors and
officers, and their respective successors and assigns (collectively, the “Shareholders
Indemnitees”), from and against all Losses suffered or incurred by any Shareholders Indemnitee
arising from: (a) any material breach of any indemnity, covenant, representation, or warranty of
Parent contained in this Agreement, (b) any misrepresentation in the certificate delivered at the
Closing pursuant to Section 9.2, or (c) any Income Taxes incurred as a result of any
transaction engaged in by the Companies, Subsidiaries after the Closing.

          11.4. Recoveries

     The determination of the amount of any Loss for purposes of this Section 11 shall take
into account the amount of insurance proceeds payable with respect thereto pursuant to any Third
Party insurance policy, but only to the extent such amounts are actually paid to the Indemnified
Party.

          11.5. Survival

          11.5.1. All claims by a Parent Indemnitee for indemnification pursuant to this Section
11 resulting from breaches of representations or warranties herein shall be forever barred
unless Shareholders are notified:

               11.5.1.1. in the case of a claim based upon a breach of Section 5.4 with respect to
any taxable period ending on or prior to the Closing Date, within the statutory period of
limitations (including any extensions thereof), unless such claim is raised by the taxing authority
by way of an offset against any claim or suit for refund by or on behalf of the Companies or
Subsidiaries, or pursuant to the mitigation provisions contained in the Code or any applicable
statutes, in which case a claim may be made within one (1) year after such offset or assessment; or

               11.5.1.2. in all other cases within eighteen (18) months after the Closing Date;
provided that if written notice for a claim of indemnification has been given by
Parent pursuant to Section 11.6.1 on or prior to the last day of the foregoing 18-month
period, then the obligation of Shareholders to indemnify any Parent Indemnitee pursuant to this
Section 11 shall survive with respect to such claim until such claim is finally resolved;
provided, further, however, that claims based upon a breach of Section
5.2.1, Section 5.2.2, the first three sentences of Section 6.1, or Section
6.4 may be brought at any time within the statute of limitations that applies to such claim or
claims.

          11.5.2. All claims by a Shareholders Indemnitee for indemnification pursuant to this
Section 11 resulting from breaches of representations or warranties herein shall be forever
barred unless Parent is notified within eighteen (18) months after the Closing Date;
provided that if written notice for a claim of indemnification has been given by
Shareholders on behalf of any Shareholders Indemnitee pursuant to Section 11.6.1 on or
prior to the last day of the foregoing twelve (12) month period, then the obligation of Parent to
indemnify any Shareholders Indemnitee pursuant to this Section 11 shall survive with
respect to such claim until such claim is

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finally resolved; provided, further, however, that claims based upon a
breach of the first three sentences of Section 7.2 may be brought at any time within the
statute of limitations that applies to such claim or claims.

          11.6. Notice and Defense of Actions

     The obligations and liabilities of each Indemnifying Party hereunder shall be subject to the
following terms and conditions:

               11.6.1. Notice. Except with respect to any Scheduled Claim, the Indemnified Party
shall give written notice to the Indemnifying Parties promptly after it becomes aware of any claim,
action or proceeding (each, an “Action”) as to which indemnity may be sought under this
Section 11; provided that in any event, the Indemnified Parties shall give
written notice of an Action within thirty (30) days after being served with the related process or
legal proceeding. Such notice shall state the nature and basis of such claims or events and the
amounts thereof, to the extent known, and shall attach copies of any complaint, demand or
arbitration notice received by the Indemnified Party. Such notice shall be given in accordance
with Section 13.1. The failure of the Indemnified Party to give notice as provided herein
shall relieve the Indemnifying Party of any obligation under this Section 11 only if and to
the extent that such failure materially prejudices the ability of the Indemnifying Party to defend
such Action, and such failure shall in no event relieve the Indemnifying Party of any liability
that the Indemnifying Party may have to the Indemnified Party otherwise under this Section
11.

          11.6.2. Defense of Actions.

               11.6.2.1. (a) Except with respect to any Scheduled Claim, in the event that the Indemnifying
Parties acknowledge in writing a duty to defend with respect to such Action, the Indemnifying
Parties shall have the right, at their expense, to control the defense of any such Action. If the
Indemnifying Parties wish to control the defense of such Action, they shall deliver written notice
thereof to the Indemnified Parties within sixty (60) days after receipt of the notice described in
Section 11.6.1. After such notice, the Indemnifying Parties shall engage independent
internal or external legal counsel (and reasonably acceptable to the Indemnified Parties) to assume
the defense of such Action; provided, however, that the Indemnified Party may also
participate in such defense, at its own expense; and provided, further,
that any Indemnifying Party shall not be entitled to assume the defense or control of any
Action if (i) the Indemnifying Party fails to acknowledge its duty to defend as set forth in the
preceding sentence, (ii) the Indemnified Party agrees, in writing, to assume the defense of such
Action and forego any indemnity claimed under this Section 11, (iii) in the reasonable
opinion of legal counsel for the Indemnified Party, such Action involves the potential imposition
of a criminal liability on the Indemnified Party, its directors, officers, employees or agents,
(iv) in the reasonable opinion of legal counsel for the Indemnified Party, an actual or potential
conflict of interest exists where it is advisable for such Indemnified Party to be represented by
separate legal counsel, or (v) with respect to Parent only, failure to stay the enforcement of such
Action will result in the imminent risk of sale, forfeiture or loss of all or any material portion
of the Assets or a material disruption in the operation of the acquired business. In the
circumstances identified in the foregoing subsections 11.6.2(a)(i) through (v), the
Indemnified Party shall be entitled to control and assume responsibility for the defense of such
Action, at the cost and expense of the

49

 

Indemnifying Party. The Indemnifying Party may, in any event, participate in such proceedings
at its own cost and expense.

                    (b) With respect to any Scheduled Claim, Shareholders shall have the right and obligation, at
its expense, to control the defense of such Scheduled Claim. Parent also may participate in such
defense, at its own expense. Shareholders shall have the right to select and engage internal or
external legal counsel (which shall be reasonably acceptable to Parent if selected and engaged
after the date of this Agreement) to assume the defense of such Scheduled Claim. From and after
the Effective Date, the cost of the defense of all Scheduled Claims and any claims that arise or
are filed between the Effective Date and the Closing Date shall be borne by the Parent provided,
however, the cost of the defense of any claims that arise after the date of this Agreement, but
before the Closing Date, shall be borne by Shareholders.

               11.6.2.2. The Indemnifying Party, in the defense of any such Action, shall have the right in
its sole discretion to settle such Action only if (a) settlement involves only the payment of money
and execution of appropriate releases of the Indemnified Party and its Affiliates, as the case may
be, (b) there is no finding or admission of any violation of Law or violation of the rights of any
Person by the Indemnified Party or its Affiliates, as the case may be, and (c) the Indemnified
Party or its Affiliates, as the case may be, will have no liability with respect to such compromise
or settlement. Otherwise, no such Action shall be settled or agreed to without the prior written
consent of the Indemnified Party (which consent shall not be unreasonably withheld, delayed or
conditioned). If the Indemnified Party withholds, delays or conditions its consent in an
unreasonable manner, the Indemnified Party shall not be entitled to indemnification under this
Section 11 for any Loss in excess of the amount for which the Action could reasonably have
been compromised but for such withholding, delay or conditioning of consent.

               11.6.2.3. Except with respect to any Scheduled Claim, in the event that the Indemnifying
Parties shall not agree in writing to assume the defense of such Action or in the event the
Indemnified Party assumes control of such Action pursuant to Section 11.6.2, the
Indemnified Parties may engage internal or external legal counsel acceptable to them to assume the
defense and may contest, pay, settle or compromise any such Action on such terms and conditions
reasonably acceptable to the Indemnified Parties. If the Indemnifying Parties are obligated to
indemnify the Indemnified Parties in respect to such Action under this Agreement, the fees and
expenses of such counsel retained by the Indemnified Parties shall constitute litigation expenses
subject to indemnification under this Section 11.

               11.6.2.4. In the defense of any Action, regardless of who is in control, the Indemnified
Parties and the Indemnifying Parties shall fully cooperate in good faith in connection with such
defense and shall cause their legal counsel, accountants and Affiliates to do so, and shall make
available to the other party all relevant books, records, and information (in such Person’s
control) during normal business hours, and shall furnish to each other, at the Indemnifying Party’s
expense, such other assistance as the other party may reasonably require in connection with such
defense.

50

 

          11.7. Exclusive Remedy

     Except for remedies that cannot be waived as a matter of law and remedies available for
breaches under Section 13.2, the indemnification obligations under this Section 11
shall be the sole and exclusive remedies of the parties hereto with respect to any breach of any
representation, warranty, covenant, indemnity, or agreement under this Agreement or any certificate
delivered pursuant hereto by any party hereto, except that nothing contained herein shall be
construed as limiting or impairing the rights and remedies that the parties hereto may have at
equity for injunctive relief and specific performance, including such equitable remedies with
respect to enforcement of rights and obligations under Sections 2, 3.4.2, 4.3, 4.4 and 4.5.

          11.8. Treatment

     All indemnification payments under this Agreement shall be treated as adjustments to the
Merger Consideration.

12. TERMINATION

          12.1. Method of Termination

     This Agreement constitutes the binding and irrevocable agreement of the parties hereto to
consummate the transactions contemplated hereby subject to the terms and conditions contained
herein, the consideration for which is the covenants set forth in Sections 2, 3 and
4, and expenditures and obligations incurred and to be incurred by Parent, on the one hand,
and by Shareholders, the Companies, and Subsidiaries, on the other hand, in respect of this
Agreement, and this Agreement may be terminated or abandoned only as follows:

          12.1.1. By the unanimous written consent of Shareholders and Parent, notwithstanding prior
approval (if any) by the board of directors of either Parent or the Companies;

          12.1.2. If any condition to the Closing under Sections 8 and 9 has not been
satisfied (or waived) by 5:00 p.m. on the one (1) year anniversary of the Effective Date or at such
other time and date as may be mutually agreed upon by the parties in writing, Shareholders may
terminate this Agreement by written notice given to Parent if Shareholders has neither (a)
proximately contributed to the occurrence of the failure to satisfy the conditions set forth in
Sections 8 and 9 by such date, nor (b) failed to use its commercially reasonable
efforts to satisfy the conditions set forth in Sections 8 and 9;

          12.1.3. If any condition to the Closing under Sections 8 and 9 has not been
satisfied (or waived) by 5:00 p.m. on the one (1) year anniversary of the Effective Date or at such
other time and date as may be mutually agreed upon by the parties in writing, Parent may terminate
this Agreement by written notice given to Shareholders and the Companies if Parent has neither (a)
proximately contributed to the occurrence of the failure to satisfy the conditions set forth in
Sections 8 and 9 by such date, nor (b) failed to use its commercially reasonable
efforts to satisfy the conditions set forth in Sections 8 and 9; or

51

 

          12.1.4. By either Shareholders or Parent if (a) there shall be any Law that makes consummation
of the transactions contemplated herein illegal or otherwise prohibited; or (b) any judgment,
injunction, order or decree permanently enjoining any of the parties hereto from consummating the
transactions contemplated herein is entered and such judgment, injunction, order or decree shall
become final and non-appealable.

          12.1.5. By Shareholders at any time during the five (5) day period ending two (2) calendar
days before the Closing Date, if:

	 	(i)	 	the Average Closing Price is less than $9.49;
and
	 
	 	(ii)	 	(A) the number obtained by dividing the Average
Closing Price by $9.49 shall be less than (B) the number obtained by
dividing the Index Price on the Walkaway Determination Date by the
Index Price on the Starting Date and subtracting 0.20 from such
quotient.

     If Shareholders elect to exercise this termination right, RMO shall give written notice to be
received by Parent no later than one day following the Walkaway Determination Date; provided that,
such notice of termination may be withdrawn by Shareholders at any time prior to two calendar days
before the Closing Date. For five days after receipt of such a notice, Parent shall have the
irrevocable right to increase the number of shares of Parent Common Stock being issued to
Shareholders hereunder so that the Share Consideration Value is equal to the Merger Consideration
less the Assumed Debt. If Parent makes this election, it shall give written notice to Shareholders
of such election and the revised number of shares of Parent Common stock being issued hereunder.
In such event, no termination will occur pursuant to this Section 12.1.5, and this
Agreement shall remain in effect in accordance with its terms (except that the number of shares of
Parent Common Stock being issued to Shareholders hereunder shall have been so modified), and any
reference in this Agreement to the issuance of shares of Parent Common Stock to Shareholders shall
be deemed to refer to the share issuance after giving effect to the adjustment made pursuant to
this Section.

     If Parent declares or affects a stock dividend, reclassification, recapitalization, split-up,
combination or similar transaction between the Starting Date and the Walkaway Determination Date
(or establishes a record date in respect thereof), the price of Parent Common Stock shall be
appropriately adjusted for the purposes of applying this Section.

     Notwithstanding anything in this Section 12.1 to the contrary, no party hereto that is
in breach of a material obligation under this Agreement shall be entitled to terminate this
Agreement except with the prior written consent of the other party hereto. In the event the
Shareholders exercise their right to terminate this Agreement pursuant to this Section 12.1.5 then
RMO shall pay Parent One Hundred Thousand Dollars ($100,000) as consideration for such termination.

          12.2. Procedure and Effect of Termination

          12.2.1. In the event of a termination by any party pursuant to and in accordance with
Section 12.1, such terminating party shall give prompt written notice thereof as provided

52

 

therein to the other party, and the transactions contemplated hereby shall be abandoned and
terminated, without further action by any of the parties hereto, except as provided in Section
12.2.1.

          12.2.2. In the event of a termination pursuant to Section 12.1:

               12.2.2.1.   All filings, applications and other submissions relating to the consummation of
the transactions contemplated herein shall, to the extent practicable, be withdrawn from the
Governmental Authority or other Person to which made; and

               12.2.2.2.   No party hereto, or any of its Affiliates, nor any shareholder, member, partner,
director, officer, employee, or agent of any such party or any of its Affiliates, shall have any
liability or further obligation to any other party hereto or any of its Affiliates, nor to any
shareholder, member, partner, director, officer, employee, or agent of such other party or any of
its Affiliates pursuant to this Agreement, except (a) that the provisions of Sections
3.4.2, 12.2, 13.2, and 13.3  (and associated defined terms) shall
survive any such termination and not be extinguished thereby, provided that the
provisions of Section 3.4.2 shall terminate on the later of the second anniversary of such
termination or the date the Confidential Information loses its status as a trade secret or no
longer qualify as confidential under applicable Law; and (b) any party hereto nevertheless shall be
entitled to seek any remedy to which it may be entitled at law or in equity for the violation or
breach by the other party hereto of any agreement, covenant, indemnity, representation or warranty
contained in this Agreement that occurs prior to the termination.

13. GENERAL PROVISIONS

          13.1. Notices

     All notices, demands and requests hereunder by any party hereto to the other party hereto
shall be in writing, and shall be delivered by hand, nationally recognized overnight courier,
facsimile, or registered or certified mail, return receipt requested, first class postage prepaid,
addressed as follows:

13.1.1. If to Shareholders:

Richard M. Osborne

8500 Station St., Suite 113

Mentor, OH 44060

Facsimile No. (440) 255-8645

and copies to legal counsel to Shareholders:

Dworken & Bernstein Co., LPA

60 South Park Place

Painesville, OH 44077

Attn: Melvyn E. Resnick and Jodi Littman Tomaszewski

Facsimile No.: (440) 352-3469

53

 

13.1.2. If to Parent:

Energy West Incorporated

P.O. Box 2229

Great Falls, MT 59403

Attn: Kevin Degenstein, President and Chief Operating Officer

Facsimile No.: (406) 791-7560

and copies to legal counsel to Parent:

Kohrman, Jackson & Krantz., PLL

1375 E. Ninth Street

One Cleveland Center

Twentieth Floor

Cleveland, Ohio 44114

Attn: Marc Krantz

Facsimile No.: (216) 621-6536

and

McCarthy, Lebit, Crystal & Liffman Co., L.P.A.

101 West Prospect Avenue, Suite 1800

Cleveland, Ohio 44115-1088

Attn: Kenneth B. Liffman

Facsimile No. (216) 696-1210

          13.1.3. If delivered by hand or nationally recognized overnight courier, the day on which a
notice, demand or request is delivered shall be the date on which such delivery is made, if
delivered by facsimile, the day upon which sender receives from its facsimile machine the correct
answerback of the addressee and confirmation of uninterrupted transmission by a transmission report
or the recipient confirming by telephone to the sender that the recipient has received the
facsimile message shall be the date on which such delivery is made (provided a hard copy of such
transmission is dispatched by first class mail within 48 hours), and, if delivered by mail, the day
on which such notice, demand or request is received shall be the date of delivery; provided
that a notice given in accordance with this Section 13.1 but received on any day
other than a Business Day or after business hours in the place of receipt, will be deemed to be
received on the next Business Day in that place.

          13.1.4. Any party hereto may change its address or facsimile number specified for notices
herein by designating a new address or facsimile number for notices by notice to the other party in
accordance with this Section 13.1.

          13.2. Brokers

               13.2.1. Parent represents and warrants to Shareholders and the Companies that no investment
banker, broker or finder has acted for Parent in connection with this

54

 

Agreement or the transactions. Parent hereby agrees to indemnify and hold harmless
Shareholders, the Companies, and Subsidiaries and their respective Affiliates against any fee, loss
or expense arising out of any claim by any investment banker, broker or finder employed or alleged
to have been employed by Parent or any of its Affiliates in connection with this Agreement or the
transactions contemplated herein.

               13.2.2. Shareholders represent and warrant to Parent that no investment banker, broker or
finder has acted for Shareholders, the Companies, or Subsidiaries or any of their Affiliates in
connection with this Agreement or the transactions contemplated herein. Shareholders hereby agree
to indemnify and hold harmless Parent, any Affiliate of Parent, and, after the Closing, the
Companies, and Subsidiaries against any fee, loss or expense arising out of any claim by any
investment banker, broker or finder employed or alleged to have been employed by Shareholders, the
Companies, Subsidiaries or any of their Affiliates in connection with this Agreement or the
transactions contemplated herein.

          13.3. Expenses

     All expenses incurred by a party hereto in connection with or related to the authorization,
preparation, negotiation and execution of this Agreement and the Closing of the transactions
contemplated hereby, including all fees and expenses of agents, representatives, legal counsel,
accountants and other technical consultants employed by such party, shall be borne solely and
entirely by the party that has incurred the same (except as otherwise expressly provided herein),
and provided that all expenses incurred by Shareholders shall be paid by Shareholders, as opposed
to the Companies or Subsidiaries.

          13.4. Further Assurances

     Each party covenants that at any time, and from time to time, after the Closing, it will
execute such additional instruments and take such actions as may be reasonably requested by the
other party to confirm or perfect or otherwise to carry out the intent and purposes of this
Agreement.

          13.5. Attribution of Knowledge

     With respect to any representation or warranty set forth in this Agreement or any other
agreements, certificates or instruments delivered pursuant hereto that is expressly qualified by:
(a) the phrase “to the knowledge of Shareholders” or “to the best knowledge of Shareholders” and
variations thereof when used with respect to Shareholders shall refer to matters actually known,
and not constructively known, to any of the individuals listed on Schedule 13.5(a); and (b)
the phrase “to the knowledge of Parent” or “to the best knowledge of Parent” and variations thereof
when used with respect to Parent shall refer only to matters actually known, and not constructively
known, to any of the individuals listed on Schedule 13.5(b). Without limiting the
foregoing, a matter shall be deemed to be “actually known” by an individual listed on Schedule
13.5 if such individual has received written notice of such matter.

55

 

          13.6. Waiver

     Any failure on the part of any party hereto to comply with any of its obligations, agreements
or conditions hereunder may be waived in writing by the other party to whom such compliance is
owed. No waiver of any provision of this Agreement shall be deemed, or shall constitute, a waiver
of any other provision, whether or not similar, nor shall any waiver constitute a continuing
waiver.

          13.7. Assignment; Binding Effect; No Third-Party Beneficiaries

     Neither this Agreement nor any of the rights, interests or obligations under this Agreement
may be assigned or delegated, in whole or in part, by operation of law or otherwise by any party
hereto without the prior written consent of the other party hereto, and any such assignment without
such prior written consent shall be null and void, except that Parent may assign this contract to
its parent company without Shareholders’ or the Companies’ consent, but in such case Parent shall
provide Shareholders and the Companies with written notice of such assignment. Subject to the
preceding sentence, this Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the parties hereto and their respective successors and permitted assigns. No
provision of this Agreement or any agreement referenced herein shall create a third-party
beneficiary relationship or otherwise confer any benefit, entitlement or right upon any Person
other than the parties to this Agreement or such referenced agreement, as the case may be, except
for Sections 11.2 and 11.3, which are intended to benefit and be enforceable by any
of the Parent Indemnitees or the Shareholders Indemnitees, respectively.

          13.8. Headings

     The section and other headings in this Agreement are inserted solely as a matter of
convenience and for reference, and are not a part of this Agreement. References to any “Section”
herein (such as “Section 5”) shall be construed to include a reference to all subsections
thereunder (i.e., 5.1, 5.1.1, ... 5.5, 5.6 ... etc).

          13.9. Entire Agreement

     This Agreement constitutes the entire agreement between the parties hereto with respect to the
subject matter herein and supersedes and cancels any prior agreements, representations, warranties,
or communications, whether oral or written, between the parties hereto relating to the transactions
contemplated hereby or the subject matter herein.

          13.10. Modifications

     Neither this Agreement nor any provision hereof may be modified, amended, changed, waived,
discharged or terminated orally, but only by an agreement in writing signed by the party against
whom or which the enforcement of such modification, amendment, change, waiver, discharge or
termination is sought.

56

 

          13.11. Governing Law

     This Agreement shall be governed by and construed in accordance with the laws of the State of
Ohio, without regards to the principles of conflicts of laws thereof.

          13.12. Severability

     The provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or enforceability of the other
provisions hereof. If any provision of this Agreement, or the application thereof to any Person or
any circumstance, is invalid or unenforceable, (a) a suitable and equitable provision shall be
substituted therefor in order to carry out, so far as may be valid and enforceable, the intent and
purpose of such invalid or unenforceable provision, and (b) the remainder of this Agreement and the
application of such provision to other Persons or circumstances shall not be affected by such
invalidity or unenforceability, nor shall such invalidity or unenforceability affect the validity
or enforceability of such provision, or the application thereof, in any other jurisdiction.

          13.13. Counterparts

     This Agreement may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. Execution by
facsimile signature shall be deemed to be, and shall have the same effect as, execution by original
signature.

          13.14. Exhibits and Schedules Incorporated

     All Exhibits and Schedules attached hereto are incorporated herein by reference. The section
numbers in the Schedules correspond to the section numbers in this Agreement; provided, however,
that any information disclosed in the Schedules under any section number shall be deemed to be
disclosed and incorporated in any other section of this Agreement where such disclosure is made
with such specificity, or in such a context, that it is reasonably apparent that such disclosure is
applicable to such other section numbers. Prior to the Closing Date, Shareholders shall supplement
or amend the Schedules with respect to any matter relating to the subject matter thereof hereafter
arising which, if existing or occurring at the date of this Agreement, would have been required to
be set forth or described in the Schedules. No supplement or amendment of any Schedule made
pursuant to this Section 13.14 shall be deemed to cure any breach of, or expand or limit
the scope of, or otherwise modify or affect any representations or warranty made in this Agreement
unless the parties agree thereto in writing unless the omitted item is an obligation, liability or
other matter which occurred or was incurred by the Companies or the Subsidiaries in the Ordinary
Course of Business.

          13.15. Joint Preparation

     The parties have participated jointly in the negotiation and drafting of this Agreement. In
the event an ambiguity or question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by the parties and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any of the provisions of this
Agreement.

57

 

          13.16. Performance by Affiliates

     Any obligation of any party hereto owed to any other party hereto under this Agreement, which
obligation is performed, satisfied or fulfilled by an Affiliate of such party, shall be deemed to
have been performed, satisfied or fulfilled by such party.

          13.17. Consent to Jurisdiction; Waivers of Trial by Jury 

     Each party irrevocably agrees that any legal action or proceeding arising out of or relating
to this Agreement or for recognition and enforcement of any judgment in respect hereof or thereof
brought by another party hereto or its successors or assigns may be brought and determined in the
United States District Court, Northern District of Ohio and each party hereby irrevocably submits
with regard to any action or proceeding for itself and in respect to its property, generally and
unconditionally, to the nonexclusive jurisdiction of the aforesaid courts. Each party hereto
hereby irrevocably waives, and agrees not to assert, by way of motion, as a defense, counterclaim
or otherwise, in any action or proceeding with respect to this Agreement, (a) any claim that it is
not personally subject to the jurisdiction of the above-named courts for any reason other than the
failure to lawfully serve process, (b) that it or its property is exempt or immune from
jurisdiction of any such court or from any legal process commenced in such courts (whether through
service of notice, attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise), and (c) to the fullest extent permitted by applicable law,
that (i) the suit, action or proceeding in any such court is brought in an inconvenient forum,
(ii) the venue of such suit, action or proceeding is improper and (iii) this Agreement, or the
subject matter hereof or thereof, may not be enforced in or by such courts. Each party hereto
further agrees that service of any process, summons, notice or document by U.S. registered mail to
such party’s respective address set forth in Section 13 shall be effective service of
process for any action, suit or proceeding with respect to any matters to which it has submitted to
jurisdiction in this Section 13.17. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY
WAIVES TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING RELATING TO A DISPUTE AND FOR ANY
COUNTERCLAIM WITH RESPECT THERETO.

          13.18. Shareholder Obligations 

     Each party irrevocably agrees that Howell, Rigo, Whelan and Smith shall have no liability
under this Agreement in regard to any breach of a representation or warranty or covenant. Where in
this Agreement provision is made for an action to be taken or not taken by Shareholders, RMO shall
cause Shareholders to take or not take such action, as the case may be.

[Signatures On The Following Page]

58

 

     IN WITNESS WHEREOF, each party hereto has caused this Agreement and Plan of Merger to be
executed on its behalf, all as of the day and year first above written.

	 	 	 	 	 
	 

	 	The Companies:	 	 
	 
	 	 	 	 
	 

	 	LIGHTNING PIPELINE CO., INC.	 	 
	 
	 	 	 	 
	 

	 	/s/ Richard M. Osborne
 

Richard M. Osborne, Chairman of the Board
	 	 
	 
	 	 	 	 
	 

	 	GREAT PLAINS NATURAL GAS COMPANY	 	 
	 
	 	 	 	 
	 

	 	/s/ Richard M. Osborne
 

Richard M. Osborne, Chairman of the Board
	 	 
	 
	 	 	 	 
	 

	 	BRAINARD GAS CORP.	 	 
	 
	 	 	 	 
	 

	 	/s/ Richard M. Osborne
 

Richard M. Osborne, Chairman of the Board
	 	 
	 
	 	 	 	 
	 

	 	Shareholders:	 	 
	 
	 	 	 	 
	 

	 	/s/ Richard M. Osborne
 

Richard M. Osborne, Trustee
	 	 
	 
	 	 	 	 
	 

	 	/s/ Rebecca Howell
 

Rebecca Howell
	 	 
	 
	 	 	 	 
	 

	 	/s/ Stephen G. Rigo
 

Stephen G. Rigo
	 	 
	 
	 	 	 	 
	 

	 	/s/ Marty Whelan
 

Marty Whelan
	 	 
	 
	 	 	 	 
	 

	 	/s/ Thomas J. Smith
 

Thomas J. Smith
	 	 

59

 

 Parent:

	 	 	 	 	 
	 	ENERGY WEST, INCORPORATED

 	 
	 	By:  	/s/ Kevin J. Degenstein
 	 
	 	Kevin J. Degenstein, President 	 
	 	 	 	 
	 

60

 

EXHIBIT A

to

Agreement and Plan of Merger

Form of Shareholders’ Closing Certificate

[TO COME]

A-1

 

EXHIBIT B

to

Agreement and Plan of Merger

Form of Parent’s Closing Certificate

[TO COME]

B-1EX-10.3

Exhibit 10.3

 

AGREEMENT AND PLAN OF MERGER

by and among

Energy West, Incorporated

An Acquisition Subsidiary

and

Great Plains Land Development Company, LTD.

and

Richard M. Osborne, Trustee

Dated as of June 29, 2009

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	1.	 	 	DEFINITIONS
	 	 	1	 
	 
	 	 	 	 	1.1. Defined Terms
	 	 	2	 
	 	 	 	 	1.2. Construction of Certain Terms and Phrases
	 	 	9	 
	 	 	 	 	 
	 	 	 	 
	 	2.	 	 	THE MERGERS
	 	 	9	 
	 
	 	 	 	 	2.1. The Merger
	 	 	9	 
	 	 	 	 	2.2. The Closing
	 	 	10	 
	 	 	 	 	2.3. Effective Time
	 	 	10	 
	 	 	 	 	2.4. Effects of Merger
	 	 	10	 
	 	 	 	 	2.5. Articles of Organization of the Surviving Corporation
	 	 	10	 
	 	 	 	 	2.6. Operating Agreement of the Surviving Corporation
	 	 	10	 
	 	 	 	 	2.7. Directors and Officers of the Surviving Corporation
	 	 	10	 
	 	 	 	 	2.8. Effect on Company Interests
	 	 	11	 
	 	 	 	 	2.9. Change in Interests
	 	 	11	 
	 	 	 	 	2.10. Exchange Procdures
	 	 	12	 
	 	 	 	 	2.11. No Further Ownership Rights or Claims Relating to Company Interests
	 	 	12	 
	 	 	 	 	2.12. No Fractional Shares of Parent Common Stock
	 	 	12	 
	 	 	 	 	2.13. Lost Certificates
	 	 	12	 
	 	 	 	 	2.14. Withholding Rights
	 	 	12	 
	 	 	 	 	2.15. Further Assurances
	 	 	13	 
	 	 	 	 	2.16. Unit Transfer Books
	 	 	13	 
	 	 	 	 	 
	 	 	 	 
	 	3.	 	 	PRE-CLOSING COVENANTS AND UNDERTAKINGS
	 	 	13	 
	 
	 	 	 	 	3.1. Satisfaction of Closing Conditions
	 	 	13	 
	 	 	 	 	3.2. Conduct of the Business of the Company and Subsidiaries Prior to Closing
	 	 	13	 
	 	 	 	 	3.3. Consents and Approvals
	 	 	15	 
	 	 	 	 	3.4. Access, Information and Confidentiality
	 	 	16	 
	 	 	 	 	3.5. Delivery of Financial Statements
	 	 	17	 
	 	 	 	 	3.6. Public Announcements
	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	 	4.	 	 	ADDITIONAL AGREEMENTS
	 	 	18	 
	 
	 	 	 	 	4.1. Tax Matters
	 	 	18	 
	 	 	 	 	4.2. Employee and Benefit Matters
	 	 	20	 
	 	 	 	 	4.3. Guaranties or Bonds
	 	 	21	 
	 	 	 	 	4.4. Agreement Not to Solicit Employees
	 	 	21	 
	 	 	 	 	4.5. Insurance Claims
	 	 	21	 
	 	 	 	 	 
	 	 	 	 
	 	5.	 	 	REPRESENTATIONS AND WARRANTIES OF RMO REGARDING THE COMPANY
	 	 	22	 
	 
	 	 	 	 	5.1. Organization and Good Standing of the Company; Foreign Qualifications
	 	 	22	 
	 	 	 	 	5.2. Capitalization of the Company
	 	 	22	 
	 	 	 	 	5.3. Financial Statements; Undisclosed Liabilities
	 	 	23	 

i

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	5.4. Taxes
	 	 	23	 
	 	 	 	 	5.5. Tangible Personal Property
	 	 	23	 
	 	 	 	 	5.6. Agreement Related to Other Instruments; Consents
	 	 	24	 
	 	 	 	 	5.7. Absence of Changes
	 	 	24	 
	 	 	 	 	5.8. Material Claims
	 	 	25	 
	 	 	 	 	5.9. Permits; Compliance With Laws
	 	 	25	 
	 	 	 	 	5.10. Real Property
	 	 	25	 
	 	 	 	 	5.11. Intellectual Property; Software
	 	 	27	 
	 	 	 	 	5.12. Material Contracts
	 	 	27	 
	 	 	 	 	5.13. Labor Matters
	 	 	29	 
	 	 	 	 	5.14. ERISA and Related Matters
	 	 	29	 
	 	 	 	 	5.15. Guaranties or Bonds
	 	 	29	 
	 	 	 	 	5.16. Employees
	 	 	30	 
	 	 	 	 	5.17. Environmental Matters
	 	 	30	 
	 	 	 	 	5.18. Insurance Coverage
	 	 	31	 
	 	 	 	 	5.19. Governmental Filings: No Violations
	 	 	31	 
	 	 	 	 	5.20. Accounts Receivable
	 	 	32	 
	 	 	 	 	5.21. Gratuitous Payments
	 	 	32	 
	 	 	 	 	5.22. Disclosures
	 	 	33	 
	 	 	 	 	5.23. Litigation
	 	 	33	 
	 	 	 	 	5.24. Brokers and Finders
	 	 	33	 
	 	 	 	 	5.25. Regulatory Proceedings
	 	 	33	 
	 	 	 	 	 
	 	 	 	 
	 	6.	 	 	REPRESENTATIONS AND WARRANTIES OF RMO REGARDING THE COMPANY, AND THE COMPANY INTERESTS
	 	 	33	 
	 
	 	 	 	 	6.1. Power and Authority; Enforceability
	 	 	34	 
	 	 	 	 	6.2. No Violation or Conflict by RMO or the Company
	 	 	34	 
	 	 	 	 	6.3. RMO and the Company Governmental Approvals
	 	 	34	 
	 	 	 	 	6.4. Title to the Company Interests
	 	 	34	 
	 	 	 	 	6.5. Litigation Against RMO or the Company
	 	 	35	 
	 	 	 	 	6.6. Taxes
	 	 	35	 
	 	 	 	 	6.7. Investment
	 	 	35	 
	 	 	 	 	 
	 	 	 	 
	 	7.	 	 	REPRESENTATIONS AND WARRANTIES OF PARENT
	 	 	36	 
	 
	 	 	 	 	7.1. Organization and Standing
	 	 	36	 
	 	 	 	 	7.2. Corporate Power and Authority; Enforceability
	 	 	36	 
	 	 	 	 	7.3. No Violation or Conflict by Parent
	 	 	36	 
	 	 	 	 	7.4. Parent Governmental Approvals
	 	 	36	 
	 	 	 	 	7.5. Litigation Against Parent
	 	 	37	 
	 	 	 	 	7.6. Purchase for Investment
	 	 	37	 
	 	 	 	 	7.7. Knowledge of Inaccuracies
	 	 	37	 
	 	 	 	 	7.8. Investigations
	 	 	38	 
	 	 	 	 	 
	 	 	 	 
	 	8.	 	 	CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT
	 	 	38	 
	 
	 	 	 	 	8.1. Representations True at the Closing
	 	 	38	 
	 	 	 	 	8.2. Covenants of RMO
	 	 	38	 

ii

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	8.3. No Injunction, Etc.
	 	 	38	 
	 	 	 	 	8.4. Consents, Approvals and Waivers
	 	 	38	 
	 	 	 	 	8.5. Absence of Material Adverse Effect
	 	 	39	 
	 	 	 	 	8.6. Consummation of Mergers pursuant to Other Merger Agreement
	 	 	39	 
	 	 	 	 	 
	 	 	 	 
	 	9.	 	 	CONDITIONS PRECEDENT TO THE OBLIGATIONS OF RMO AND THE COMPANY
	 	 	39	 
	 
	 	 	 	 	9.1. Representations True at Closing
	 	 	39	 
	 	 	 	 	9.2. Covenants of Parent
	 	 	39	 
	 	 	 	 	9.3. No Injunction, Etc.
	 	 	39	 
	 	 	 	 	9.4. Consents, Approvals and Waivers
	 	 	40	 
	 	 	 	 	9.5. Consummation of Mergers pursuant to Other Merger Agreement
	 	 	40	 
	 	 	 	 	 
	 	 	 	 
	 	10.	 	 	TRANSACTIONS AT CLOSING
	 	 	40	 
	 
	 	 	 	 	10.1. Transactions at Closing
	 	 	40	 
	 	 	 	 	 
	 	 	 	 
	 	11.	 	 	SURVIVAL OF REPRESENTATION AND WARRANTIES; INDEMNIFICATION
	 	 	41	 
	 
	 	 	 	 	11.1. Survival of Representations, Warranties and Agreements
	 	 	42	 
	 	 	 	 	11.2. Agreements to Indemnify Parent Indemnitees
	 	 	42	 
	 	 	 	 	11.3. Agreements to Indemnify the Shareholder Indemnitees
	 	 	42	 
	 	 	 	 	11.4. Recoveries
	 	 	43	 
	 	 	 	 	11.5. Survival
	 	 	43	 
	 	 	 	 	11.6. Notice and Defense of Actions
	 	 	43	 
	 	 	 	 	11.7. Exclusive Remedy
	 	 	45	 
	 	 	 	 	11.8. Treatment
	 	 	45	 
	 	 	 	 	 
	 	 	 	 
	 	12.	 	 	TERMINATION
	 	 	46	 
	 
	 	 	 	 	12.1. Method of Termination
	 	 	46	 
	 	 	 	 	12.2. Procedure and Effect of Termination
	 	 	46	 
	 	 	 	 	 
	 	 	 	 
	 	13.	 	 	GENERAL PROVISIONS
	 	 	47	 
	 
	 	 	 	 	13.1. Notices
	 	 	47	 
	 	 	 	 	13.2. Brokers
	 	 	48	 
	 	 	 	 	13.3. Expenses
	 	 	49	 
	 	 	 	 	13.4. Further Assurances
	 	 	49	 
	 	 	 	 	13.5. Attribution of Knowledge
	 	 	49	 
	 	 	 	 	13.6. Waiver
	 	 	49	 
	 	 	 	 	13.7. Assignment; Binding Effect; No Third-Party Beneficiaries
	 	 	50	 
	 	 	 	 	13.8. Headings
	 	 	50	 
	 	 	 	 	13.9. Entire Agreement
	 	 	50	 
	 	 	 	 	13.10. Modifications
	 	 	50	 
	 	 	 	 	13.11. Governing Law
	 	 	50	 
	 	 	 	 	13.12. Severability
	 	 	50	 
	 	 	 	 	13.13. Counterparts
	 	 	51	 
	 	 	 	 	13.14. Exhibits and Schedules Incorporated
	 	 	51	 

iii

 

	 	 	 	 	 	 	 	 	 
	 	 	 	 	13.15. Joint Preparation
	 	 	51	 
	 	 	 	 	13.16. Performance by Affiliates
	 	 	51	 
	 	 	 	 	13.17. Consent to Jurisdiction; Waivers of Trial by Jury
	 	 	51	 

iv

 

LIST OF EXHIBITS

	 	 	 
	Exhibit A

	 	Form of RMO’s and the Company’s Closing Certificate
	 
	 	 
	Exhibit B

	 	Form of Parent’s Closing Certificate

v

 

LIST OF SCHEDULES

	 	 	 
	 	 	The Schedules of the Other Merger Agreement and this
Agreement shall be the same.

	 
	Schedule 3.2(j)
	 	Pre-Closing Employee Payment Issues

	 
	Schedule 3.2(k)
	 	Pre-Closing Company and Non-Company Affiliate Agreements

	 
	Schedule 4.2.1
	 	The Company’s Employees

	 
	Schedule 4.2.2
	 	NEO and Orwell Vacation and Sick Leave Policy

	 
	Schedule 5.2.1
	 	Ownership of Company Interests

	 
	Schedule 5.3.1
	 	Financial Statements

	 
	Schedule 5.3.2.1
	 	Assumed Debt

	 
	Schedule 5.3.2.2
	 	Undisclosed Liabilities

	 
	Schedule 5.4
	 	Taxes

	 
	Schedule 5.5.1
	 	Tangible Personal Property

	 
	Schedule 5.5.2
	 	Company’s Procedure to Collect Accounts Receivable

	 
	Schedule 5.7
	 	Absence of Changes

	 
	Schedule 5.8
	 	Material Claims

	 
	Schedule 5.9
	 	Permits; Compliance with Laws

	 
	Schedule 5.10.1
	 	Owned Real Property

	 
	Schedule 5.10.2
	 	Leased Real Property

	 
	Schedule 5.10.3
	 	Real Property Matters

	 
	Schedule 5.11.1
	 	Intellectual Property

	 
	Schedule 5.11.2(a)
	 	The Company’s Software

	 
	Schedule 5.11.2(b)
	 	Non-Company Affiliates’ Software

	 
	Schedule 5.12
	 	Material Contracts

	 
	Schedule 5.13
	 	Labor Matters

	 
	Schedule 5.14
	 	ERISA and Related Matters

	 
	Schedule 5.15
	 	Guaranties or Bonds

	 
	Schedule 5.16
	 	Employees

	 
	Schedule 5.17
	 	Environmental Compliance

	 
	Schedule 5.18
	 	Insurance Coverage

	 
	Schedule 5.19
	 	Government Filings

	 
	Schedule 5.20
	 	Accounts Receivable

	 
	Schedule 6.2
	 	No Violation or Conflict by RMO or the Company

	 
	Schedule 6.4
	 	Title to the Company Interests

	 
	Schedule 6.5
	 	Litigation Against RMO or the Company

	 
	Schedule 7.3
	 	No Violation or Conflict by Parent

	 
	Schedule 7.4
	 	Parent Governmental Approvals

vi

 

	 	 	 
	Schedule 13.5(a)
	 	Attribution of Knowledge for RMO

	 
	Schedule 13.5(b)
	 	Attribution of Knowledge for Parent

vii

 

AGREEMENT AND PLAN OF MERGER

     THIS AGREEMENT AND PLAN OF MERGER (this “Agreement”) is entered into as of this 29th
day of June, 2009 (the “Effective Date”), by and among Energy West, Incorporated, a corporation
incorporated under the laws of the State of Montana (“Parent”), one-to-be-formed
wholly-owned Ohio subsidiary limited liability company of Parent (the “Acquisition Sub”),
Great Plains Land Development Company, LTD, an Ohio limited liability company (“GPL” or the
“Company”), and RICHARD M. OSBORNE, TRUSTEE (“RMO” or the “Member”) of the
Richard M. Osborne Trust, the sole member of GPL.

W I T N E S S E T H:

     WHEREAS, the Member owns one hundred percent (100%) of the outstanding limited liability
company membership interests or units of GPL (the “Company Interests”);

     WHEREAS, Parent is a regulated utility company whose service area includes Montana, Wyoming,
Maine, and North Carolina;

     WHEREAS, Parent has entered into a merger agreement as of even date herewith with Lightning
Pipeline Company, Inc. (“Lightning”), Great Plains Natural Gas Company (“Great
Plains”) and Brainard Gas Corp. (“BGC”), each an affiliate of GPL (the “Other
Merger Agreement”);

     WHEREAS, GPL leases its real estate to a subsidiary of Great Plains; and

     WHEREAS, Board of Directors of Parent and the sole Member of the Company have determined that
a business combination between Parent and the Company is fair to and in the best interests of their
respective stockholders/member and presents an opportunity for their respective companies to
achieve long-term strategic and financial benefits, and accordingly have agreed to effect a
business combination under the terms and subject to the conditions set forth in this Agreement,
have approved this Agreement and have declared this Agreement and the Merger advisable;

     WHEREAS, in furtherance of the foregoing, the Board of Directors of Parent and the sole Member
of the Company have approved this Agreement and the Merger, upon the terms and subject to the
conditions of this Agreement, pursuant to which the Company Interests issued and outstanding
immediately prior to the Effective Time will be converted into the right to receive shares of
common stock, par value $0.15 per share, of Parent (“Parent Common Stock”)as set forth in
Section 2.

     NOW, THEREFORE, in consideration of the foregoing and the mutual promises, representations,
warranties, covenants and agreement set forth in this Agreement, and intending to be legally bound
hereby, the parties agree as follows:

1. DEFINITIONS

 

 

     1.1. Defined Terms.

     As used herein, the following terms shall have the following meanings unless the context
otherwise requires:

     “Accounts Receivable” means any and all accounts receivable of the Company, as the
term “accounts receivable” is understood under GAAP.

     “Accrued Tax Liability” means the aggregate amount of Tax liabilities (including
deferred Taxes) of the Company as reflected on the Closing Date balance sheet.

     “Action” has the meaning set forth in Section 11.6.1.

     “Affiliate” means (a) with respect to RMO and the Company; and (b) with respect to any
other Person, any Person that, directly or indirectly, through one or more intermediaries,
Controls, is Controlled by, or is under common Control with, such first Person. For purposes of
this definition and this Agreement, the Company shall be deemed to be an Affiliate of the Member
prior to the Closing and an Affiliate of Parent from and after the Closing.

     “Agreement” has the meaning set forth in the Preamble.

     “Articles of Merger” has the meaning set forth in Section 2.3.

     “Assets” means all of the assets, rights, interests, contract rights, accounts,
claims, credits, franchises and properties of the Company, whether real, personal, tangible or
intangible.

     “Assumed Debt” means all long term debt obligations, including loans from RMO, of the
Company, incurred in the Ordinary Course of Business, as reflected on the balance sheet of the
Company for the month preceding the Closing; provided that if the Assumed Debt at Closing does not
exceed $884,366.97.

     “Average Closing Price” means the average of the closing prices per share of the
Parent Common Stock as reported on Nasdaq for the twenty (20) consecutive trading days ending seven
(7) calendar days before the Closing Date.

     “Benefit Plan” means: (a) each “employee benefit plan,” as such term is defined in
Section 3(3) of ERISA, (b) each plan that would be an “employee benefit plan”, as such term is
defined in Section 3(3) of ERISA, if it was subject to ERISA, such as foreign plans and plans for
directors, (c) each unit bonus, unit ownership, option, unit purchase, membership unit appreciation
rights, phantom unit, or other unit plan (whether qualified or nonqualified), and (d) each bonus or
incentive compensation plan; provided, however, the term “Benefit Plan” shall not
include (i) routine employment policies and procedures or payroll plans developed and applied in
the ordinary course of business and consistent with past practice, including wage, vacation,
holiday, and sick or other leave policies, (ii) workers’ compensation insurance, and
(iii) directors’ and officers’ liability insurance.

     “Business Day” means any day excluding Saturday, Sunday and any day that is a legal
holiday in the State of Ohio.

2

 

     “CERCLA” has the meaning given to it in the definition of “Environmental Law.”

     “Closing” has the meaning set forth in Section 2.2.

     “Closing Date” has the meaning set forth in Section 2.2.

     “Code” means the Internal Revenue Code of 1986, as amended, and the rules and
regulations promulgated thereunder (the “Treasury Regulations”).

     “Company” has the meaning set forth in the Preamble.

     “Company Interests” has the meaning set forth in the Preamble.

     “Company’s Employees” has the meaning set forth in Section 4.2.1.

     “Company Insurance Policies” means policies of insurance with insurance carriers and
contractual arrangements with insurance adjusters maintained by the Company or by any Non-Company
Affiliate that covers the Company or Member prior to the Closing.

     “Company Plans” means each Benefit Plan (other than the Member Plans) that is
sponsored or maintained as of the date of this Agreement by the Company, for the benefit of any of
its current or former manager, members, officers or employees.

     “Confidential Information” means (a) all information concerning a party hereto and/or
its Affiliates furnished to another party hereto or any director, member, officer, employee, agent,
advisor, or other representative (a “Representative”) of such receiving party or any of its
Affiliates in writing, orally or electronically by such disclosing party or any Representative of
such disclosing party or any of its Affiliates in connection with this Agreement or the
transactions contemplated herein, whether before or after the date hereof, including, but not
limited to, any such information (i) concerning the business, financial condition, operations,
products, services, assets, customers, forecasts and/or liabilities of such disclosing party and/or
its Affiliates, (ii) which relates to technologies, intellectual property or capital, models,
concepts, or ideas of such disclosing party and/or its Affiliates, (iii) of third parties that such
disclosing party and/or its Affiliates is required under applicable Law or contracts to keep
confidential, or (iv) that has been clearly identified as confidential; and (b) terms and
conditions of this Agreement and any other agreement entered into pursuant hereto, the fact that
the parties hereto have entered into this Agreement, and that this Agreement exists;
provided, however, the term “Confidential Information” shall not include
information that: (i) is already known or in the possession of such receiving party at the time of
disclosure, as evidenced by such receiving party’s written documentation, unless received or
obtained as confidential information; (ii) becomes subsequently available to such receiving party
on a non-confidential basis from a source not known or reasonably suspected by such receiving party
to be bound by a confidentiality agreement or secrecy obligation owed to such disclosing party;
(iii) is or becomes generally available to the public other than as a result of a breach of
Section 3.4.2 by such receiving party or any Representative of such receiving party or any
of its Affiliates; or (iv) is independently developed by such receiving party without use, directly
or indirectly, of Confidential Information of such disclosing party, as evidenced by such receiving
party’s written documentation; provided further, however, if only a portion
of the Confidential Information falls

3

 

under one of the foregoing exceptions, then only that portion shall not be deemed Confidential
Information.

     “Consolidated” means: (i) with respect to the financial statement(s) of the Company
and any Affiliates, the presentation of the results of operations and the financial position of the
Company and the Affiliates essentially as if the Company and the Affiliates were a single company
with one or more branches or divisions; and (ii) with respect to any financial item(s) of the
Company and the Affiliates, the presentation of such item(s) essentially as if the Company and the
Affiliates were a single company with one or more branches or divisions, in each case as determined
in accordance with GAAP (whether or not the Company and the Affiliates would in fact be
Consolidated under GAAP).

     “Consolidated Income Tax Returns” means any Income Tax Returns filed for any
consolidated, combined or unitary group of corporations under federal, state or local laws, the
common parent of which is RMO.

     “Contract” means any legally binding obligation or agreement (other than a Benefit
Plan) to which the Company is a party, whether or not reduced to writing, and specifically
including but not limited to any note, bond, mortgage, lease of real or personal property, license
agreement, construction contract, subcontract, engineering contract, guarantee, suretyship
agreement, pledge agreement, indemnity, joint venture or partnership agreement, confidentiality
agreement, non-competition agreement, insurance contract, employment agreement or other contract or
agreement.

     “Control” means (a) possession, directly or indirectly, of the power to direct or
cause the direction of management and policies of a Person, whether through the ownership of voting
securities, as a trustee or executor, by contract or credit arrangement or otherwise, or (b) the
ownership of more than fifty percent (50%) of the equity interest in a Person.

     “Deductible” has the meaning set forth in Section 11.5.

     “Default” shall mean (a) a material breach or default, or (b) the occurrence of an
event that with the passage of time or the giving of notice or both would constitute a material
breach or default.

     “DOJ” means the United States Department of Justice.

     “Dollar” or “$” means the lawful currency of the United States.

     “Effective Time” has the meaning set forth in Section 2.3.

     “Environmental Law” means any federal, state, provincial or local law, statute,
ordinance, rule, regulation, or order relating to the protection of the environment, including the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq.)
(“CERCLA”), the Hazardous Material Transportation Act (49 U.S.C. § 1801 et seq.), the
Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Federal Water Pollution
Control Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.),

4

 

the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), and the Safe Drinking Water Act
(42 U.S.C. § 300 et seq.), as amended or supplemented, that is in effect on the Closing Date.

     “Exchange Ratio” has the meaning set forth in Section 2.8(a).

     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

     “FERC” means the United States Federal Energy Regulatory Commission.

     “Financial Statements” means the Year-End Financial Statements.

     “FIRPTA Certificate” means a certificate, as described in Treasury Regulation Section
1.1445-2(b)(2), which is signed under penalties of perjury by RMO, and which (i) certifies that RMO
is not “foreign persons,” as defined in Treasury Regulation Section 1.1445-2(b)(2), and (ii)
provides RMO’s name, identifying number (as defined in Section 6109 of the Code), and office
address.

     “FTC” means the United States Federal Trade Commission.

     “GAAP” means generally accepted accounting principles as recognized by the American
Institute of Certified Public Accountants, as in effect from time to time.

     “Governmental Authority” means any nation, province, state, county, municipality and
any other political subdivision of any of the foregoing, and any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to government, including MPSC,
WPSC, PPUC, FERC, FTC, DOJ, PUCO, SEC and IRS.

     “Guaranty or Bond” means any guaranty, letter of credit, surety bond and any other
similar material agreement or arrangement pursuant to which RMO or one or more Non-Company
Affiliates has obligations with respect to any obligations of the Company, and any security or
collateral furnished in connection with any such guaranty, letter of credit, surety bond or other
similar agreement or arrangement.

     “Hazardous Substance” means and includes each substance designated as a hazardous
waste, hazardous substance, hazardous material, pollutant, contaminant or toxic substance under any
Environmental Law and any petroleum hydrocarbons.

     “Income Tax” means any Taxes imposed on, or measured by, net income.

     “Income Tax Returns” means any Tax Returns relating to Income Taxes.

     “Indemnified Party” means any Person seeking indemnification from another Person
pursuant to Section 11.

     “Indemnifying Party” means any Person against whom a claim for indemnification is
asserted pursuant to Section 11.

5

 

     “Index Price” on a given date means the closing value on such date of the American Gas
Stock Index as maintained by the American Gas Association.

     “Intellectual Property” means the following intellectual property rights, including
both statutory and common law rights, if applicable: (a) copyrights and registrations for
copyrights, (b) trademarks, service marks, trade names, slogans, domain names, logos, symbols, and
trade dress, and registrations and applications for registrations thereof, and (c) trade secrets
and confidential information, including ideas, designs, concepts, compilations of information,
methods, techniques, procedures, processes and other know-how, whether or not patentable.

     “IRS” means the United States Internal Revenue Service.

     “Law” means any law, statute, code, ordinance, regulation, order, reporting or
licensing requirement, or rule, including those promulgated, interpreted or enforced by any
Governmental Authorities.

     “Lien” means any mortgage, pledge, lien, security interest, hypothecation, conditional
sale agreement, restriction, option, defect in title, easement, encumbrance, charge, or other
similar title exception; provided, however, that the term “Lien” shall not include
(a) liens for current Taxes not yet due and payable, including liens for nondelinquent ad valorem
taxes and nondelinquent statutory liens arising other than by reason of any default on the part of
any of the Company, RMO or any of their Affiliates, (b) liens in favor of carriers, warehousemen,
mechanics, landlords and materialmen imposed by mandatory provisions of Law and incurred in the
Ordinary Course of Business for sums not yet due and payable, and (c) as to any leased Asset, the
rights of the lessor or landlord with respect to such leased Asset.

     “Losses” has the meaning set forth in Section 11.2.1.

     “Major Customer” shall mean any customer of the Company from which the Company
recognized in accordance with GAAP at least Twenty-Five Thousand Dollars ($25,000.00) in revenue
between January 1, 2008, and December 31, 2008.

     “Material Adverse Effect” means any change (or changes taken together) in, or effect
on, the business, financial condition, prospects, or operations of the Company that is (are)
materially adverse to the business, financial condition, prospects, or operations of the Company,
but excluding any change (or changes taken together) or effect which is cured (including by the
payment of money) before the earlier of the Closing or the termination of this Agreement under
Section 12.1. Without limiting the foregoing and except for purposes of Sections
5.7(l) and 8.5, any uninsured loss or damage suffered by the Company of Twenty-Five
Thousand Dollars ($25,000) shall be deemed to have a Material Adverse Effect.

     “Material Contracts” has the meaning set forth in Section 5.12.1.

     “Member” has the meaning set forth in the Preamble.

     “Member Plan” means each Benefit Plan (other than the Company Plans) that is
sponsored, maintained or contributed to as of the Closing Date by the Company or a Non-

6

 

Company Affiliate and that covers the current or former directors, officers or employees of
the Company.

     “Merger” has the meaning set forth in Section 2.1.

     “Merger Consideration” has the meaning set forth in Section 2.8(a).

     “Mortgage” means any real estate mortgages which secure land and buildings owned by
GPL.

     “MPSC” means the Montana Public Service Commission.

     “New Guaranty or Bond” has the meaning set forth in Section 4.3.1.

     “Non-Company Affiliate” means any Affiliate controlled by RMO other than the Company,
Great Plains, Lightning, BGC or their subsidiaries.

     “Ordinary Course of Business” means, with respect to the Company, the ordinary course
of business which is consistent with past practices of the Company.

     “Organizational Documents” means articles of incorporation, articles of organization,
certificate of incorporation, charter, bylaws, code of regulations, certificate of formation,
limited liability company operating agreement, joint venture agreement or partnership agreement, as
applicable.

     “Other Merger Agreement” has the meaning set forth in the Preamble.

     “Parent” has the meaning set forth in the Preamble.

     “Parent Common Stock” has the meaning set forth in the Preamble.

     “Parent Indemnitees” has the meaning set forth in Section 11.2.1.

     “Patent” means (a) any patent granted by the U.S. Patent and Trademark Office or
comparable agency of any other country, as well as any reissued and reexamined patent and
extensions corresponding to such patent, and (b) any patent application filed with the U.S. Patent
and Trademark Office or comparable agency in any other country, as well as any related continuation
or continuation in part, any divisional application and patent issuing therefrom, and any
respective foreign counterpart patent application or foreign patent issuing therefrom.

     “Permits” means all licenses and permits issued by any Governmental Authority.

     “Person” means an individual, partnership, limited partnership, joint venture, limited
liability company or partnership, corporation, bank, trust, company, business entity, governmental
entity or organization, or unincorporated organization.

     “PPUC” means the Pennsylvania Public Utilities Commission.

     “Pre-Closing Income Tax Returns” has the meaning set forth in Section 4.1.1.

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     “Property and Casualty Claims” has the meaning set forth in Section 4.5.

     “PUCO” means The Public Utilities Commission of Ohio.

     “Real Property Leases” has the meaning set forth in Section 5.10.2.

     “Regulatory Approval” means the approval by the MPSC, WPSC, PPUC and PUCO of the
transaction contemplated by this Agreement.

     “Representative” has the meaning given to it in the definition of “Confidential
Information.”

     “Restricted Period” means the period commencing on the Closing Date and expiring on
the second anniversary of the Closing Date.

     “Retained Employee Liabilities” has the meaning set forth in Section 4.2.1.

     “RMO Indemnitees” has the meaning set forth in Section 11.3.

     “Scheduled Claim” means any of the matters set forth in Schedule 5.7.

     “SEC” means the United States Securities and Exchange Commission.

     “Separate Income Tax Returns” means Income Tax Returns of the Company and any
Affiliate, other than Consolidated Income Tax Returns.

     “Software” means computer software programs including operating systems, application
programs and software tools.

     “Straddle Returns” has the meaning set forth in Section 4.1.2.

     “Subsidiaries” has the meaning set forth in the Preamble.

     “Tangible Personal Property” means all machines, equipment, tools, computers,
terminals, telephones, telephone systems, furniture, automobiles, fixtures, leasehold improvements,
parts and other tangible personal property and fixtures owned or leased by the Company, including
the property listed on Schedule 5.5.1.

     “Tax” or “Taxes” means all United States, federal, state and local, and all
foreign, income, profits, franchise, gross receipts, payroll, transfer, sales, employment, use,
property, license, excise, value added, ad valorem, estimated, stamp, alternative or ad-on minimum,
recapture, environmental, withholding and any other taxes, charges, duties, impositions or
assessments, together with all interest and penalties and additions imposed on or with respect to
such amounts, or levied, assessed or imposed against the Company, including any liability for taxes
of any predecessor entity.

     “Tax Audit” has the meaning set forth in Section 4.1.7(a).

     “Tax Indemnified Person” has the meaning set forth in Section 4.1.7(a).

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     “Tax Indemnifying Person” has the meaning set forth in Section 4.1.7(a)

     “Tax Return” means any return, declaration, report, claim for refund, or information
return or statement filed or required to be filed by the Company or which includes information
relating to income or losses of the Company, or otherwise relates to the Company, including any
predecessor entities, with any taxing authority under federal, state, local or any foreign laws in
connection with the determination, assessment, collection or imposition of any Taxes.

     “Third Party” means any Person other than RMO, the Company, Parent, any Indemnified
Party or any Affiliate of RMO, Parent or any Indemnified Party.

     “Transfer Tax” has the meaning set forth in Section 4.1.6.

     “Transferred Employee” has the meaning set forth in Section 4.2.1.

     “WPSC” means the Wyoming Public Service Commission.

     “Year-End Financial Statements” means the unaudited, pro forma consolidated balance
sheet of the Company dated December 31, 2008.

   1.2. Construction of Certain Terms and Phrases

     Unless the context of this Agreement otherwise requires, (a) words of any gender include the
other gender; (b) words using the singular or plural number also include the plural or singular
number, respectively; (c) the terms “hereof,” “herein,” “hereunder,” “hereby” and derivative or
similar words refer to this entire Agreement; (d) the terms “include,” “includes,” and “including”
shall be deemed to be followed by the words “but not limited to;” (e) the term “Section” refers to
the specified Section of this Agreement; (f) the term “Schedule” or “Exhibit” refers to a Schedule
or Exhibit attached to this Agreement; (g) references to time are to Cleveland, Ohio time; and (h)
the term “material” and derivative or similar words refer to materiality with respect to the
Company. Whenever this Agreement refers to a number of days, such number shall refer to calendar
days unless Business Days are specified. Except as otherwise stated herein, all accounting terms
used herein and not expressly defined herein shall have the meanings given to them under GAAP.

2. THE MERGER

   2.1. The Merger

     Upon the terms and subject to the conditions set forth in this Agreement, at the Effective
Time, the Acquisition Sub shall be merged with and into GPL in accordance with the provisions of
the Ohio Revised Code and this Agreement, and the separate corporate existence of the Acquisition
Sub shall thereupon cease and GPL shall be the surviving limited liability company in the Merger
(sometimes referred to herein as a “Surviving Corporation”). Following the Effective Time,
GPL, as the Surviving Corporation, shall succeed to and assume all of the rights and obligations of
the Acquisition Sub. The actions taken in this Section 2.1 shall be referred to the
“Merger.”

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   2.2. The Closing

     The closing of the Merger (the “Closing”) shall take place on the first Business Day
of the first full month following the satisfaction or waiver (subject to applicable Law) of the
conditions (other than those conditions that by their nature are to be fulfilled at the Closing,
but subject to the fulfillment or waiver of such conditions) set forth in Section 8, unless
this Agreement has previously terminated pursuant to its terms or unless another date is agreed to
in writing by the parties (the actual date of Closing being referred to herein as the “Closing
Date”). The Closing shall be held at 10 a.m. at the offices of Kohrman Jackson & Krantz,
P.L.L., 1375 E. Ninth Street, 20th Floor, Cleveland, Ohio 44114, unless another place is
agreed to in writing by the parties.

   2.3. Effective Time

     At the Closing, the parties shall file the articles of merger (each “Articles of
Merger”) in such form as required by and executed in accordance with the relevant provisions of
the Ohio Revised Code. The Merger shall become effective at the time of filing of the Articles of
Merger with the Ohio Secretary of State in accordance with the Ohio Revised Code or such later time
as the Company and Parent shall have agreed upon and designated in the Articles of Merger as the
effective time of the Merger (the time the Merger becomes effective being the “Effective
Time”).

   2.4. Effects of Merger

     At and after the Effective Time, the Merger shall have the effects specified herein and in the
Ohio Revised Code. As a result of the Merger, the Surviving Corporation shall become a
wholly-owned subsidiary of Parent.

   2.5. Articles of Organization of the Surviving Corporation

     As of the Effective Time, the articles of organization of the Acquisition Sub as in effect
immediately prior to the Effective Time shall be the articles of organization of the Surviving
Corporation, until thereafter amended as provided therein or by applicable Law; provided, however,
that the articles of organization of the Surviving Corporation shall be amended in the Merger to
provide that the Surviving Corporation shall have the name of the Company.

   2.6. Operating Agreement of the Surviving Corporation

     As of the Effective Time, the operating agreement of the Acquisition Sub as in effect
immediately prior to the Effective Time shall be the operating agreement of the Surviving
Corporation, until thereafter amended as provided therein or by applicable Law; provided, however,
that the operating agreement shall be amended to reflect the change of name of the Surviving
Corporation as provided in Section 2.5 above.

   2.7. Directors and Officers of the Surviving Corporation

     The directors and officers of the Acquisition Sub immediately prior to the Effective Time
shall be the officers and directors of the Surviving Corporation, from and after the Effective

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Time, until their successors shall be elected and qualified or their earlier death,
resignation or removal in accordance with the articles of organization and operating agreement of
the Surviving Corporation.

     2.8. Effect on Capital Stock

               (a) At the Effective Time, by virtue of the Merger and without any action on the part of the
Member, each Company Interest issued and outstanding immediately prior to the Effective Time shall
be converted into the right to receive shares of validly issued, fully paid and non-assessable
Parent Common Stock (the “Merger Consideration”) based on the following calculation
computed as of the Closing Date:

The total number of shares of Parent Common Stock that the Member shall be entitled
to receive for Merger Consideration for the Company shall be the total of Three
Million One Hundred Thousand Dollars ($3,100,000.00) less the Assumed Debt divided
by $10 (the “Exchange Ratio”).

Parent shall prepare an allocation of the Merger Consideration (and all other capitalized
costs) among the Assets in accordance with Section 1060 of the Code and the applicable
Treasury Regulations (and any similar provision of state or local law, as appropriate),
which allocation shall be binding upon the Company. Parent shall deliver such allocation
to the Company within 60 days after the Closing Date. Parent and the Company and their
Affiliates shall report, act and file Tax Returns (including, but not limited to Internal
Revenue Service Form 8594) in all respects and for all purposes consistent with such
allocation by Parent. The Company shall timely and properly prepare, execute, file and
deliver all such documents, forms and other information as Parent may reasonably request to
prepare such allocation. Neither Parent nor the Company shall take any position (whether
in audits, tax returns or otherwise) that is inconsistent with such allocation unless
required to do so by applicable Law.

               (b) As a result of the Merger and without any action on the part of the Member, at the
Effective Time, the Company Interests shall cease to be outstanding and shall be canceled and
retired and shall cease to exist, and the Member shall thereafter cease to have any rights with
respect to the Company Interests, except the right to receive (i) the Merger Consideration payable
in respect of such Company Interests, and (ii) any cash to be paid in lieu of any fractional share
of Parent Common Stock pursuant to Section 2.12.

               (c) At the Effective Time, by virtue of the Merger and without any action on the part of the
Member, each membership interest of the Acquisition Sub issued and outstanding immediately prior to
the Effective Time shall be converted into one validly issued, fully paid and nonassessable
membership interest of the Surviving Corporation.

     2.9 Change in Shares

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     If, between the date of this Agreement and the Effective Time (and to the extent permitted by
this Agreement), the number of Company Interests shall have been increased, decreased, changed into
or exchanged for a different number Company Intersts by reason of any reclassification,
recapitalization, subdivision, stock split, reorganization, combination, contribution or exchange
of shares, or a stock dividend or dividend payable in other securities shall be declared with a
record date within such period, or any similar event shall have occurred, the Exchange Ratio and
any other number or amount contained herein which is based upon the number of Company Interests
shall be appropriately adjusted to provide to Parent and the Member the same economic effect as
contemplated by this Agreement prior to such event.

          2.10 Exchange Procedures

     At Closing, the Member shall be entitled to receive in exchange for his Company Interests (A)
one or more shares of Parent Common Stock (which shall be in certificated form with the applicable
restrictive legends) representing, in the aggregate, the whole number of shares of Parent Common
Stock that such Member has the right to receive pursuant to Section 2.8 and/or (B) a check
in the amount equal to the cash that such holder has the right to receive consisting of cash in
lieu of fractional shares of Parent Common Stock pursuant to Section 2.12 (the “Cash
Payment”). No interest will be paid or accrued on any Cash Payment.

          2.11 No Further Ownership Rights or Claims Relating to Company Interests

     All Merger Consideration issued and any cash paid upon conversion of the Company Interests
pursuant to this Section 2 shall be deemed to have been issued and paid in exchange for,
and in full satisfaction of, all rights pertaining to such Company Interests and any claims for,
relating to or arising out of the Company Interests or ownership thereof.

          2.12 No Fractional Shares of Parent Common Stock

     Notwithstanding any other provision of this Agreement, the Member who would otherwise have
been entitled to receive a fraction of a share of Parent Common Stock (after taking into account
all Company Interests delivered by such Member) shall receive, in lieu thereof, cash (without
interest) in an amount equal to the product of (i) such fractional part of a share of Parent Common
Stock multiplied by (ii) the Average Closing Price. Such payment of cash consideration is in lieu
of fractional shares of Parent Common Stock.

          2.13 Lost Certificates

     If any certificate for Company Interests shall have been lost, stolen or destroyed, upon the
making of an affidavit of that fact by the person claiming such certificate to be lost, stolen or
destroyed and, if required by Parent, the posting by such person of a bond in such reasonable
amount as Parent may direct as indemnity against any claim that may be made against it with respect
to such certificate Parent will deliver in exchange for such lost, stolen or destroyed certificate
the applicable Merger Consideration and any Cash Payment with respect to the Company Interests
formerly represented thereby.

          2.14 Withholding Rights

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     The Surviving Corporation and Parent shall be entitled to deduct and withhold from the
consideration otherwise payable pursuant to this Agreement to Member such amounts as it is required
to deduct and withhold with respect to the making of such payment under the Code and the Treasury
Regulations, or any provision of state, local or foreign tax law. To the extent that amounts are so
withheld by the Surviving Corporation or Parent, as the case may be, such withheld amounts shall be
treated for all purposes of this Agreement as having been paid to Member in respect of which such
deduction and withholding was made by the Surviving Corporation or Parent, as the case may be.

          2.15 Further Assurances

     After the Effective Time, the officers and directors of the Surviving Corporation will be
authorized to execute and deliver, in the name and on behalf of the Company or the Acquisition Sub,
all deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf
of the Company or the Acquisition Sub, all other actions and things to vest, perfect or confirm of
record or otherwise in the Surviving Corporation all right, title and interest in, to and under the
rights, properties and assets acquired or to be acquired by the Surviving Corporation as a result
of, or in connection with, the Merger.

          2.16 Unit Transfer Books

     The unit transfer books of the Company shall be closed immediately upon the Effective Time and
there shall be no further registration of transfers of Company Interests thereafter on the records
of the Company. On or after the Effective Time, all Company Interests presented to Parent in
accordance with the provisions of this Agreement shall be converted into the Merger Consideration
and any Cash Payment payable with respect to the Company Interests formerly represented thereby.

	3.	 	PRE-CLOSING COVENANTS AND UNDERTAKINGS

   3.1. Satisfaction of Closing Conditions

     The parties shall use their commercially reasonable efforts to bring about, as soon as
practical after the date hereof, the satisfaction of all the conditions set forth in
Sections 8 and 9.

   3.2. Conduct of the Business of the Company Prior to Closing

     Except as in the Ordinary Course of Business or with the prior written consent of Parent
(which consent shall not be unreasonably withheld, delayed or denied), or as otherwise provided in
Schedule 3.2 or in any other Schedule attached to this Agreement, and except as may be
required to effect the transactions contemplated by this Agreement, or as is otherwise authorized
by this Agreement, RMO covenants that he shall, and shall cause the Company to, during the period
commencing on the date of this Agreement and terminating at the Closing:

               (a) preserve intact the legal existence of the Company and carry on the Company’s business in
the Ordinary Course of Business, and use its commercially reasonable efforts to preserve the
goodwill of the Company;

13

 

               (b) maintain the Tangible Personal Property in the Ordinary Course of Business;

               (c) keep in force at no less than their present limits all existing surety bonds and policies
of insurance insuring the Assets and the Company’s business, except to the extent that any such
surety bond or insurance policy is no longer applicable or otherwise required pursuant to the
business of the Company;

               (d) use commercially reasonable efforts to maintain in full force and effect all Permits held
by the Company, except those Permits the failure of which to hold, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect;

               (e) neither enter into, modify, amend or terminate any Material Contract or Real Property
Lease, nor waive, release, compromise or assign any material rights or claims thereunder, nor
suffer, permit or incur any of the transactions or events described in Section 5.7 to the
extent such events or transactions are within the reasonable control of the Member or the Company;

               (f) not make any distributions of the Assets to the Member in the form of return of capital or
cash distributions;

               (g) not make or permit any change in the Company’s Organizational Documents, or in the
Company’s authorized, issued or outstanding securities;

               (h) not issue any additional membership interests or other securities or ownership interests
of the Company, grant any stock option or right to purchase any security or ownership interest of
the Company, issue any security or ownership interest convertible into such securities or ownership
interests, purchase, redeem, retire or otherwise acquire any of such securities or ownership
interests, or declare, set aside or pay any cash distribution in respect of the securities or
ownership interests of the Company;

               (i) not make any changes in the accounting methods or practices of the Company;

               (j) not (i) pay, or incur any obligation for any payment of, any contribution or other amount
to, or with respect to, any Company Plan, (ii) pay any bonus to, make any loan, pay or transfer any
Assets to, or grant any increase in the compensation of, the Company director, officer, or
employee, (iii) make any increase in the pension, retirement or other benefits of the directors,
officers, or employees, except as set forth in Schedule 3.2(j), or (iv) hire any
additional employees, even in the Ordinary Course of Business, without the prior written consent of
the Parent, which consent shall not be unreasonably withheld;

               (k) not have the Company pay, lend or advance any amount to or in respect of, or sell,
transfer or lease any Assets to, or enter into any agreement, arrangement or transaction with, the
Member or any Non-Company Affiliate, except for the payments, agreements, arrangements, leases,
transactions and arrangements set forth in Schedule 3.2(k);

14

 

               (l) not permit the Company to (i) incur or assume any indebtedness for borrowed money or issue
any debt securities, or (ii) assume, guarantee, endorse or otherwise become liable or responsible
(whether directly, contingently or otherwise) for the obligations of any Person;

               (m) not permit the Company to (i) make any loans, advances or capital contributions to, or
investments in, any Person, (ii) pledge or otherwise encumber the Company Interests, or (iii)
mortgage or pledge any of the Assets, or create or suffer to exist any Lien thereupon;

               (n) not permit the Company to acquire, sell, lease or dispose of any Assets;

               (o) not permit the Company to (i) acquire any Person (or division thereof), any equity
interest therein or all or substantially all of the assets thereof whether through a merger,
consolidation or purchase, or (ii) enter into a joint venture, partnership or any other equity
alliance with any Person;

               (p) not permit RMO or any Non-Company Affiliate to hire away any essential employee of the
Company without Parent’s prior written consent; and

               (q) not agree to do anything, or agree to permit the Company to do anything, that would
violate any of the foregoing affirmative and negative covenants of this Section 3.2.

     3.3. Consents and Approvals

          3.3.1. Subject to the allocation of responsibility set forth in Section 3.3.2, RMO
agrees to, and agrees to cause the Company to apply for and use commercially reasonable efforts to
obtain no later than at the Closing (a) the waiver, consent and approval of all Persons whose
waiver, consent or approval is required by Law for the Company’s and the Member’s execution and
delivery of this Agreement and the Member’s and the Company’s consummation of the transactions
contemplated herein, and (b) the waiver, consent and approval of all Persons whose waiver, consent
or approval is required by any Material Contract, Real Property Lease, consent, judgment, decree,
order or Permit to which the Member or the Company is a party or subject immediately prior to the
Closing, and which would prohibit or require the waiver, consent or approval of any Person to, such
transactions or under which, without such waiver, consent or approval, such transactions would
constitute an occurrence of Default under the provisions thereof, provided,
however, that neither RMO nor the Company shall make any agreements or understandings
adversely affecting the Assets or the Company, or its business, as a condition to obtaining any
waivers, consents or approvals required by this Section 3.3.1, except as otherwise provided
herein or with the prior written consent of Parent, and further provided that if RMO fails to
obtain any consents that are required under this Section 3.3 prior to Closing (except any
required governmental consents, consents of lenders or consents relating to any of the properties),
such failure shall not be deemed a Default under this Agreement and/or cause this Agreement not to
be consummated so long as the failure to obtain the consent does not have a Material Adverse Effect
on the consummation of this Agreement, the Company, or the Assets.

15

 

          3.3.2. Each of the parties hereto (a) will take all commercially reasonable actions necessary
to comply promptly with all Laws that may be imposed on such party with respect to the transactions
contemplated herein (including requesting all necessary approvals for and executing all necessary
agreements for the novation of any Material Contracts with any Governmental Authority, requesting
all necessary material approvals of subcontractors to such contracts, providing notices and
disclosures as required for foreign Persons, and furnishing all information required under any Law
in connection with approvals of or filings with any Governmental Authority (including without
limitation MPSC, PUCO, WPSC, FTC, DOJ, SEC, PPUC or IRS)); provided, however, the
foregoing shall not require any of the parties hereto or any of their Affiliates to sell or
otherwise divest of a material portion of their respective assets or properties or discontinue any
of their respective significant operations; and (b) will promptly cooperate with and furnish
information to each other in connection with any such legal requirements imposed upon any of them
in connection with the transactions contemplated herein. Any filings or approvals required to be
accomplished by the Member, the Company or any Non-Company Affiliate in accordance with this
Section 3.3.1 shall be at the Member’s or such Non-Company Affiliate’s expense.

     3.4. Access, Information and Confidentiality

          3.4.1. Prior to the Closing, the Member shall cause the Company to (a) give Parent and its
authorized Representatives reasonable access, during normal business hours and upon reasonable
notice, to the books, records, files, documents and contracts of the Company, and (b) allow Parent
(together with its authorized Representatives) to make a reasonable number of visits to each
office, facility and other property owned or leased by the Company.

          3.4.2. (a) Subject to the first sentence of subsection (b) of this Section 3.4.2, a
party hereto receiving Confidential Information from another party hereto shall not disclose and
shall keep strictly confidential all such Confidential Information of such disclosing party;
provided, however, that such receiving party may disclose Confidential Information of such
disclosing party (i) to any Representative of such receiving party or any of its Affiliates who
needs to know such information for purposes of consummating the transactions contemplated herein;
(ii) to any partner, Affiliate, lender or investor of such receiving party or any of its
Affiliates, or any Representative of such partner, Affiliate, lender or investor who needs to know
such information for purposes of consummating the transactions contemplated herein; and (iii) to
the extent that such receiving party or Representative is required to disclose such information in
order to avoid committing a violation of any applicable law, rule or regulation, including any
rules or regulations of any securities association, stock exchange or national securities quotation
system.

               (b) In the event that a receiving party or any Representative of such receiving party or any
of its Affiliates is requested or required, pursuant to any applicable court order, administrative
order, statute, regulation or other official order by any Governmental Authority, to disclose any
Confidential Information of a disclosing party, such receiving party shall (i) provide such
disclosing party with prompt written notice of any such request or requirement so that such
disclosing party may seek a protective order or other appropriate remedy and/or waive compliance
with the provisions of this Section 3.4.2, and (ii) reasonably cooperate with such
disclosing party to obtain such protective order or other remedy. In the

16

 

event such protective order or other remedy is not obtained and a disclosing party fails to
waive compliance with the relevant provisions of this Section 3.4.2, such receiving party
agrees to (A) furnish only that portion of the Confidential Information for which such receiving
party is advised by written opinion of its legal counsel obtained at the disclosing party’s
expense, is legally required to be disclosed, (B) upon such disclosing party’s request and expense,
use its commercially reasonable efforts to obtain assurances that confidential treatment will be
accorded to such information, and (C) give such disclosing party prior written notice of the
Confidential Information to be disclosed.

               (c) If this Agreement is terminated prior to the Closing or at any other time for any reason,
upon the written request of a disclosing party, each receiving party will, and will cause all
Representatives of such receiving party or any of its Affiliates to promptly, (i) deliver to such
disclosing party all original Confidential Information (whether written or electronic) furnished to
such receiving party or any Representative of such receiving party or any of its Affiliates by or
on behalf of such disclosing party, and (ii) if specifically requested by such disclosing party,
destroy (A) any copies of such Confidential Information (including any extracts therefrom), and (B)
any portion of such Confidential Information that may be found in reports, analyses, notes,
compilations, studies and other documents prepared by or for such receiving party. From and after
the Closing, Parent shall be released from all obligations owed by it to the Member under this
Section 3.4.2 with respect to the Confidential Information owned by the Company. This
Section 3.4.2 shall survive any termination of this Agreement

   3.5. Delivery of Financial Statements

     During the period commencing on the date of this Agreement and terminating at the Closing, RMO
shall cause to be delivered to Parent, within thirty (30) days of being available or filed, copies
of (a) all regularly prepared unaudited monthly, quarterly and annual consolidated financial
statements of the Company prepared after the date of this Agreement, and (b) all material filings
or submissions by the Company with any Governmental Authority made after the date of this
Agreement.

   3.6. Public Announcements

     No party hereto or any of its Affiliates shall make any public announcement of the execution
and delivery of this Agreement or the transactions contemplated by this Agreement without first
obtaining the prior written consent of the other party hereto, such consent not to be unreasonably
withheld, delayed or conditioned; provided, however, that nothing contained in this
Section 3.6 shall prohibit any party hereto or any of its Affiliates from (a) making any
disclosures or having any discussions with the MPSC, WPSC, PPUC or PUCO regarding the Other
Agreement or the transaction contemplated by this Agreement in accordance with Section
3.3.2, or (b) making any public announcement in accordance with any required SEC filing, or (c)
having discussions with its lenders, or (d) making any public announcement if such party or its
Affiliate determines in good faith, on the advice of legal counsel, that such public disclosure is
required by applicable Law or any listing agreement with a national securities exchange or trading
market; provided further, that in such event, such party or its Affiliate shall
consult with the other party hereto prior to making such disclosure to the extent reasonably
practicable.

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	4.	 	ADDITIONAL AGREEMENTS

     4.1. Tax Matters 

          4.1.1. With respect to the Company or arising out of the operations of the Company, RMO shall
(i) cause all Tax Returns to be prepared and filed on a timely basis for all Tax periods which end
on or prior to the Closing Date, which are filed before or after the Closing Date; and (ii) pay all
Taxes with respect to such Tax periods, or, at Parent’s option, shall reimburse Parent within
fifteen (15) days after payment by Parent of such Taxes. Except as otherwise provided herein, RMO
shall submit to Parent any such Tax Returns at least thirty (30) days prior to the due date of such
Tax Return (taking into account any validly obtained extensions) for Parent’s review.
Notwithstanding the foregoing, RMO shall not be required to submit to Parent his personal IRS Form
1040, US. Individual Income Tax Return. RMO shall, however, submit to Parent all schedules or
attachments to his personal IRS Form 1040, which include information relating to the income, gain,
deductions, losses or operation of the Company. Parent and RMO shall collectively cause the
Company to timely and appropriately file all such Tax Returns submitted by RMO accordance with this
Section 4.1.1.

          4.1.2. Parent shall cause the Company to prepare and file on a timely basis all Tax Returns of
the Company due after the Closing Date, including all Tax Returns that relate to periods beginning
before and ending after the Closing Date (“Straddle Returns”). All Straddle Returns shall
be prepared on a basis consistent with procedures and practices of the Company in effect as of the
date hereof for filing such Tax Returns.

          4.1.3. To the extent that the tax year of the Company does not end on the Closing Date such
that the Tax Return is a Straddle Return, the Taxes payable on the Straddle Return shall be
allocated between the portion of the period ending on the Closing Date and the portion of the
period beginning after the Closing Date assuming that the taxable period for the Straddle Return
actually included two separate periods, one ending on the Closing Date and one beginning on the
date after the Closing Date, provided that all exemptions, allowances, or deductions for the entire
taxable for the Straddle Return which are calculated on an annual basis (including, but not limited
to, depreciation and amortization deductions) shall be allocated between the two short periods in
proportion to the number of days in each period.

          4.1.4. Access to Information

               (a) From and after the Effective Date, RMO shall grant to Parent (or its designees) access to
the information, books and records relating to the Company (including without limitation work
papers and correspondence with taxing authorities, and shall afford Parent (or its designees) the
right to take extracts therefrom and to make copies thereof for purposes of preparing Tax Returns,
to conduct negotiations with taxing authorities, and to implement the provisions of, or to
investigate or defend any claims between the parties arising under, this Agreement.

               (b) From and after the Effective Date, Parent shall grant to RMO (or its designees) access to
all of the information, books and records relating to the Company within the possession of Parent
or the Company (including without limitation work papers and

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correspondence with taxing authorities), and shall afford RMO (or his designees) the right (at
RMO’s expense) to take extracts therefrom and to make copies thereof, to the extent reasonably
necessary to permit RMO (or his designees) to prepare Tax Returns, to conduct negotiations with
taxing authorities, and to implement the provisions of, or to investigate or defend any claims
between the parties arising under, this Agreement.

               (c) Each of the parties hereto will preserve and retain all schedules, work papers and other
documents relating to any Tax Returns of or with respect to the Company to any claims, audits or
other proceedings affecting the Company until the expiration of the statute of limitations
(including extensions) applicable to the taxable period to which such documents relate or until the
final determination of any controversy with respect to such taxable period, and until the final
determination of any payments that may be required with respect to such taxable period under this
Agreement.

          4.1.5. Parent and RMO shall provide (and cause the Company to provide) each other with such
assistance as may reasonably be requested by the other in connection with the preparation of any
Tax Return, any audit or other examination by any taxing authority, or any judicial or
administrative proceedings relating to liabilities for Taxes. Such assistance shall include making
employees available on a mutually convenient basis to provide additional information or explanation
of material provided hereunder and shall include providing copies of relevant tax returns and
supporting material. Parent and RMO will retain (and shall cause the Company to retain) for the
full period of any statute of limitations any documents which may be relevant to such preparation,
audit, examination, proceeding or determination.

          4.1.6. Parent shall pay all federal, state, local, foreign and other transfers, sales, use or
similar tax (a “Transfer Tax”) applicable to, imposed upon or arising out of the transfer
of the Company Interests or any other transaction contemplated by this Agreement.

          4.1.7. Contest Provisions.

               (a) Each of Parent, on the one hand, and RMO, on the other hand (the “Tax Indemnified
Person”), shall promptly notify the chief tax officer (or other appropriate person) of RMO or
Parent, as the case may be (the “Tax Indemnifying Person”), in writing upon receipt by the
Tax Indemnified Person of written notice of any pending or threatened audits, adjustments, claims,
examinations, assessments or other proceedings (a “Tax Audit”) which are likely to affect
the liability for Taxes of such other party, provided, however, that failure to file timely written
notice to the other party shall not affect the other party’s indemnification obligations hereunder
unless such failure materially adversely affects the other party’s rights to participate in the Tax
Audit.

               (b) If such Tax Audit relates to any taxable period, or portion thereof, ending on or before
the Closing Date or for any Taxes for which RMO is liable in full under this Agreement, RMO shall,
at his expense, control the defense and settlement of such Tax Audit. If such Tax Audit relates to
any taxable period, or portion thereof, beginning on or after the Closing Date or for any
Taxes for which Parent is liable in full under this Agreement, Parent shall, at its expense,
control the defense and settlement of such Tax Audit.

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               (c) If such Tax Audit relates to Taxes for which both RMO and Parent are liable under this
Agreement, to the extent practicable, such Tax items will be distinguished and each party will
control the defense and settlement of Taxes for which it is so liable. If such Tax Audit relates
to a taxable period, or portion thereof, beginning before and ending after the Closing Date and any
Tax item cannot be identified as being a liability of only one party or cannot be separated from a
Tax item for which the other party is liable, Parent may either elect, at its expense, to control
the defense and settlement of the Tax Audit or require RMO, at his expense, to control the defense
and settlement of the Tax Audit, provided that such party defends the items as reported on the
relevant Tax Return and provided further that no such matter shall be settled without the written
consent of both parties, not to be unreasonably withheld.

               (d) Any party whose liability for Taxes may be affected by a Tax Audit shall be entitled to
participate at its expense in such defense and to employ counsel of its choice at its expense and
shall have the right to consent to any settlement of such Tax Audit (not to be unreasonably
withheld) to the extent such settlement would have an adverse effect for a period for which that
party is not liable for Taxes, under this Agreement or otherwise.

          4.1.8. All Tax sharing or similar agreements that include RMO and the Company shall be
cancelled prior to the Closing Date such that the Company, as the case may be, shall have no
further rights or obligations under such agreements.

          4.1.9. FIRPTA Certificate. Prior to Closing, RMO or the Company shall deliver a
FIRPTA Certificate to Parent.

     4.2. Employee and Benefit Matters

          4.2.1. Schedule 4.2.1 contains a list of employees who are actively employed by the
Company (including individuals on vacation, short-term disability or similar leave but excluding
those persons on long-term disability leave) on the date hereof who the parties agree and
acknowledge will be treated as employees of the Company for purposes of this Agreement, which such
Schedule 4.2.1 shall be amended as of the Closing Date to include such employees employed
in positions at the Company as of the Closing Date (“Company Employees”). Schedule
4.2.1 shall also include the amount of accrued sick leave, flex time and vacation time for
each of the Company Employees. From and after the Closing Date, Parent shall have the right to
terminate any or all of Company Employees at will or to continue the employment of any or all of
Company Employees with the Company upon terms and conditions acceptable to Parent in Parent’s sole
and absolute discretion. Parent shall provide RMO with written notification at least three (3)
days prior to the Closing Date of any employee who will be terminated as of the Closing Date.
Each Company Employee who continues employment with the Company as of the Closing Date shall
hereinafter be referred to as a “Transferred Employee.” RMO shall retain and satisfy any
and all responsibility, and Parent shall have no liability or responsibility whatsoever, for any
and all claims, liabilities and obligations, whether contingent or otherwise, relating to (i) any
current, former or retired employee of the Company who is not a Transferred Employee, including,
without limitation, any unpaid salary, wages, bonuses or other compensation or severance pay or
benefits, (ii) any Transferred Employee arising out of or relating to any period, or otherwise
incurred, prior to the Closing Date,

20

 

including, without limitation, any unpaid salary, wages, bonuses or other compensation or
severance pay, benefits or group health care coverage required by Section 4980B of the Code or
Section 601 of ERISA, and (iii) the Company Plans (such claims, liabilities and obligations,
collectively the “Retained Employee Liabilities”). Parent shall have no obligation to
continue the employment of any Transferred Employee for any period following the Closing Date, and
may terminate the employment of any Transferred Employee at will. Parent shall not receive assets
from, nor be required to assume any of the liabilities of, the Member Plans.

          4.2.2. On the Closing Date, Parent shall assume all liabilities relating to each Transferred
Employee’s unused flexible holiday, vacation and sick time, if any. Schedule 4.2.2
provides the vacation and sick leave policies of the Company together with accrued vacation and
sick leave as of the date hereof, and Schedule 4.2.2 shall be updated within three (3)
business days of Closing.

   4.3. Guaranties or Bonds

          4.3.1. After the date hereof and prior to the Closing, RMO shall not, and shall cause the
Company not to, without the prior written consent of Parent, (a) enter into, issue or obtain any
Guaranty or Bond (each individually, a “New Guaranty or Bond”), or (b) amend or otherwise
modify any Guaranty or Bond; provided, however, that Parent shall not unreasonably
withhold, delay or condition its consent to any New Guaranty or Bond which is entered into in the
Ordinary Course of Business, and Parent shall not unreasonably withhold, delay or condition its
consent to any amendment or other modification of any Guaranty or Bond in the Ordinary Course of
Business if such amendment or other modification would not result in a breach of any provision of
this Agreement; and

          4.3.2. RMO shall promptly provide Parent with a true and correct copy of any New Guaranty or
Bond or amendment or other modification to a Guaranty or Bond.

   4.4. Agreement Not to Solicit Employees

     Unless otherwise consented to in writing by Parent, RMO agrees that during the Restricted
Period, neither RMO nor any Non-Company Affiliate will solicit or hire away any Transferred
Employee.

   4.5. Insurance Claims

     RMO shall be solely responsible for the administration and, to the extent applicable, payment
of any Property and Casualty Claims with a date of occurrence prior to the Closing, and hereby
releases Parent, the Company, and their Affiliates of any responsibility or liability therefor.
Parent shall be solely responsible for the administration and, to the extent applicable, payment of
any Property and Casualty Claims with a date of occurrence on or after the Closing, and hereby
releases RMO of any responsibility or liabilities therefor. For purposes hereof, “Property and
Casualty Claims” shall mean workers’ compensation, auto liability, general liability, products
liability, professional liability, fiduciary liability, pollution liability and director and
officer liability claims relating to the business of the Company and claims for damages caused to
facilities of the Company generally insured under causes-of-loss — special form property and
boiler and machinery insurance coverage, in each case including reported

21

 

claims and incurred but not reported claims. RMO shall be solely responsible for the
administration and payment of all costs associated with claims for workers’ compensation and other
occupational health or injury claims of employees the Company prior to the Closing Date and for any
claim filed subsequent to the Closing Date made in connection with any injury, event or occurrence
taking place prior to the Closing Date.

	5.	 	REPRESENTATIONS AND WARRANTIES OF RMO REGARDING THE COMPANY
	 
	 	 	RMO represents and warrants to Parent that:

     5.1. Organization and Good Standing of the Company; Foreign Qualifications

          5.1.1. The Company is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Ohio, USA, and has all requisite limited liability company
power and authority to carry on its business as such business is currently conducted.

          5.1.2. The Company is duly licensed, registered and qualified to do business as a foreign
corporation or limited liability company, as the case may be, and is in good standing in all
jurisdictions in which the ownership, leasing or operation of their assets or the conduct of their
business as currently conducted requires such qualification under applicable Law.

          5.1.3. RMO has heretofore made available to Parent true, correct and complete copies of the
Organizational Documents, each as amended to the date hereof, of the Company.

     5.2. Capitalization of the Company

          5.2.1. As of the date of this Agreement, the Company has 100 membership units issued and
outstanding. The Company Interests (a) constitute all of the issued and outstanding membership
units of the Company, (b) are validly authorized and issued, fully paid, and nonassessable, and (c)
will as of Closing be owned beneficially and of record entirely by RMO as set forth in Schedule
5.2.1. No Company Interests were issued in violation of any preemptive, right of first refusal
or other subscription rights of any member of the Company or any other Person, and all Company
Interests were offered and sold in compliance with all applicable federal, state and provincial
securities Laws. There are no outstanding options, warrants, calls, commitments or plans by the
Company to issue any additional membership units, or to pay any cash distribution, or to purchase,
redeem or retire any outstanding membership units, nor are there outstanding any securities or
obligations which are convertible into or exchangeable for membership units. There are no
membership appreciation rights, phantom units or similar rights in existence with respect to the
Company. No Person other than RMO owns or otherwise has any rights to any securities of the
Company.

          5.2.2. The Company does not own, directly or indirectly, any capital stock or other equity
interest in any corporation, partnership, joint venture, limited liability company or partnership,
association or other legal entity.

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   5.3. Financial Statements; Undisclosed Liabilities 

          5.3.1. Attached hereto as Schedule 5.3.1 are true, correct and complete copies of the
Financial Statements which have been generated in accordance with the books and records of the
Company. Except as set forth in Schedule 5.3.1, the Financial Statements (a) have been
prepared in material accordance with GAAP, and (b) fairly and accurately present in all material
respects the financial position and the results of operations of the Company on a consolidated, pro
forma basis as of the dates and for the periods indicated in accordance with GAAP.

          5.3.2. The Company does not have any material liability or obligation that would be required
to be disclosed on a balance sheet prepared in accordance with GAAP, except for the liabilities and
obligations of the Company (a) disclosed or reserved against in the Financial Statements and the
Assumed Debt as set forth on Schedule 5.3.2.1, (b) set forth in Schedule 5.3.2.2,
or (c) incurred or accrued in the Ordinary Course of Business since December 31, 2008.

   5.4. Taxes

     Except as provided in Schedule 5.4: (i) the Company or RMO has timely extended or
filed all Tax Returns known to the Company or RMO to be required to be filed for the Company on a
separate basis and all such Tax Returns are true, correct and complete in all material respects;
(ii) the Company or RMO has paid, and until the Effective Time will, within the time and in the
manner prescribed by Law, pay, (or have established adequate reserves on their books and records
amounts for) all Taxes known to the Company to be due and payable in respect of such Tax Returns
except those being contested in good faith; (iii) the Company has withheld all amounts known to the
Company to be required to be withheld from payments to employees and other third parties and have
remitted such amounts to the appropriate taxing authority in accordance with applicable Laws; (iv)
the Company has not executed or filed with any taxing authority (whether federal, state, local or
foreign) any agreement or other document (other than normal requests to extend the time for filing
a Tax Return) extending or waiving or having the effect of extending or waiving the period for
assessment of any Tax that is due with respect to a Tax Return that the Company is required to
file; (v) no federal, state, local or foreign Tax Audits or other administrative proceeding,
discussions or court proceedings are presently in progress with regard to any Tax Returns of the
Company; and (vi) there are no Liens for Taxes upon the Assets of the Company. The Company is
treated for federal Income Tax purposes as “disregarded as an entity separate from its owner”
pursuant to Section 301.7701-3(b)(1)(ii) of the Treasury Regulations.

   5.5. Tangible Personal Property

          5.5.1. Schedule 5.5.1 sets forth a list of all Tangible Personal Property with a cost
greater than Five Thousand Dollars ($5,000.00) owned by the Company. Except as set forth in
Schedule 5.5.1, the Company have good and valid title (or, in the case of leased Tangible
Personal Property, a good and valid leasehold interest) to all of the Tangible Personal Property
used in the operation of the business of the Company as currently conducted, in each case free and
clear of any material lien except Assumed Debt.

23

 

          5.5.2. All of the Accounts Receivable shown on the Financial Statements and the Accounts
Receivable constituting a part of the Assets arose in the Ordinary Course of Business in connection
with bona fide transactions. Schedule 5.5.2 reflects the procedures the Company uses to
collect its Accounts Receivable.

   5.6. Agreement Related to Other Instruments; Consents

     The execution, delivery and performance by the Member and the Company of this Agreement and
the other documents, instruments and agreements to be entered into by the Member and the Company
pursuant hereto do not and will not, and the consummation of the transactions contemplated hereby
and thereby will not, conflict with or violate any provision of the Organizational Documents of the
Company.

   5.7. Absence of Changes

     Since December 31, 2008 through the Effective Date, the Company has not, except as set forth
in Schedule 5.7 or in the Ordinary Course of Business:

               (a) transferred, assigned or conveyed any material Assets ;

               (b) suffered any material destruction, damage or loss to any material Assets (casualty or
other), whether or not covered by insurance;

               (c) except as described in Schedule 5.12 or Schedule 3.2(k), entered into any
Material Contract;

               (d) except as described in Schedule 5.12 or Schedule 3.2(k), terminated or
amended or suffered the termination or amendment of, failed to perform in all material respects its
obligations under, or suffered or permitted any Default to exist under, any Material Contract or
Real Property Lease;

               (e) caused or consented to the imposition of a material Lien on any Asset except for the
Assumed Debt;

               (f) made any distributions to its members or RMO in the form of the return of capital,
dividends or cash distributions;

               (g) incurred or assumed any indebtedness for borrowed money or issued any debt security except
as set forth in Schedule 5.12;

               (h) waived any material right of the Company or cancelled any debt or claim held by the
Company;

               (i) made any loan to any officer, director, employee or member of the Company;

               (j) increased, directly or indirectly, the compensation paid or payable to any officer,
director, employee or agent of the Company except in accordance with Section 

24

 

3.2(j) hereof;

               (k) hired or fired any employees of the Company or changed any such employee’s terms or
conditions of employment except in accordance with Section 3.2 hereof;

               (l) taken or suffered any other act that may reasonably be expected to cause or result in a
Material Adverse Effect;

               (m) received any adverse ruling or denial of any request by any Governmental Authority,
including but not limited to the MPSC, WPSC, PPUC, or PUCO; or

               (n) agreed to do any of the foregoing items of this Section 5.7.

   5.8. Material Claims

     Except as set forth in Schedule 5.8, there is no litigation, suit, action, proceeding
or claim pending or, to the knowledge of RMO or RMO’s counsel, any basis therefore or threat
thereof against the Company that would be reasonably expected to result in a Material Adverse
Effect on the Company. Except as set forth in Schedule 5.8, there is no judgment, decree,
injunction, order, determination, award, finding or letter of deficiency of any Governmental
Authority or arbitrator outstanding with respect to the Agreement or against the Company or any of
the Assets.

   5.9. Permits; Compliance With Laws

     Except as set forth in Schedule 5.9 and for Environmental Matters, which are addressed
exclusively in Section 5.17, to RMO’s knowledge the Company possesses all Permits that are
required under applicable Law for the ownership or operation of the business of the Company as
currently conducted, to RMO’s knowledge all such Permits are in full force and effect, and to RMO’s
knowledge the Company is in compliance with all of the terms and conditions of such Permits. No
proceeding is pending or, to RMO’s knowledge, threatened seeking the revocation, cancellation,
non-renewal or limitation, in whole or in part, of any such Permit. The Company has not received
any written notice from any Governmental Authority alleging violation of any applicable Law.

   5.10. Real Property

          5.10.1. The Company does not own any fee simple interest in real property other than the real
property, buildings and improvements described in Schedule 5.10.1. The Company owns good,
valid and marketable fee simple title to such real property, free and clear of any Lien other than
the Mortgage or any other Liens that, individually or in the aggregate, could not materially
adversely affect the function of such property in connection with its use in the Ordinary Course of
Business. Except as set forth on Schedule 5.10.1 and except for easements, conditions and
other conditions of record, no part of such real property is subject to any assignment, lease,
license, sublease or other agreement granting to any Person any right to the possession, use,
occupancy or enjoyment of such property. All such real property complies in all material respects
with all federal, state, provincial and local Laws and all applicable private restrictions.

25

 

          5.10.2. RMO has heretofore delivered to Parent true, correct and complete copies of all leases
(including all amendments thereto) of real property currently leased by the Company, a list of
which is set forth in Schedule 5.10.2 (collectively, the “Real Property Leases”).
Each Real Property Lease is valid and binding on the Company that is a party thereto, and on the
other parties thereto, and is enforceable against the Company and the other parties thereto in
accordance with the terms thereof, except as enforceability may be limited by bankruptcy,
insolvency, fraudulent conveyance, fraudulent transfer, reorganization, moratorium, applicable
equitable principles or other similar Laws from time to time in effect affecting the enforcement of
creditors’ rights generally. Except as described in Schedule 5.10.2, the Company has
performed all material obligations required to be performed by it to date under all such Real
Property Leases, and neither the Company, nor any other party thereto, is in Default under any of
the Real Property Leases. Except as set forth in Schedule 5.10.2 and to the knowledge of
RMO, no part of the property leased pursuant to a Real Property Lease is subject to any assignment,
lease, license, sublease, or other agreement granting to any Person other than as specified in such
Real Property Lease any right to the possession, use, occupancy or enjoyment of such leased
property.

          5.10.3. The real property listed in Schedules 5.10.1 and 5.10.2 shall
collectively be referred to herein as the “Real Property”. The Real Property includes all
of the Real Property used by the Company in its business operations. To RMO’s knowledge, all
improvements to the Real Property are located within the boundary lines of the Real Property, and
no structure, fixture, facility or improvement on any parcel adjacent to the Real Property
encroaches onto any portion of the Real Property. To RMO’s knowledge, the Company has good and
valuable rights of physical and legal ingress and egress to and from the Real Property from and to
the public systems for all usual streets, roads and utility purposes, and to RMO’s knowledge no
condition exists that would reasonably be expected to result in the termination of such ingress
and egress. Except as set forth in Schedule 5.10.3 to RMO’s knowledge the Real Property
and any present or proposed use of the Real Property comply with all applicable Laws and all
covenants, conditions, restrictions and similar matters affecting or applicable to the Real
Property. To RMO’s knowledge, the Company has obtained all Permits from Governmental Authorities
(including certificates of use and occupancy, licenses and other Permits), required in connection
with the construction, repair, maintenance, ownership, use and occupation of the Real Property.
To RMO’s knowledge, there are no pending, or threatened condemnation, fire, health, safety,
building or other land use regulatory proceedings, lawsuits or administration actions related to
any portion of the Real Property and the Company has not received written notice of any pending or
threatened special assessment proceedings affecting any portion of the Real Property. Except for
real property taxes with respect to the tax period in which the Closing Date occurs, all real
property taxes (and applicable penalties and interest, if any) that are due and payable with
respect to the Real Property have been paid or will be paid at or prior to the Closing Date.
There are no outstanding options, rights of first offer, rights of refusal or similar contracts or
rights to purchase the Real Property or any portion thereof or interest therein. No work,
repairs, installation, construction or other services have been performed on any of the Real
Property or materials supplied to the Real Property in the four (4) month period prior to the
Closing Date that could give rise to a materialmen’s, mechanic’s, repair man’s, contractor’s, tax
or other similar lien, or if such work, repairs, installation, construction or other services have
been performed on any of the Real Property or

26

 

materials supplied to the Real Property, all providers of such work or materials have been
paid in full.

     5.11. Intellectual Property; Software

          5.11.1. Schedule 5.11.1 sets forth a list of all issued Patents and registered
copyrights, trademarks, service marks and trade names owned or licensed by the Company and
currently used in conducting its businesses in the United States or any foreign country, and the
annual licensing fee to be paid by the Company for the use of such Intellectual Property, if any.
The Company owns, or has the license or right to use in the United States and in any foreign
country in which it conducts business, all Intellectual Property currently used and necessary to
conduct the business of the Company as presently conducted, in the United States and in each
foreign country where the Company uses such Intellectual Property.

          5.11.2. Schedule 5.11.2(a) sets forth a list of all Software owned or licensed by the
Company, and Schedule 5.11.2(b) sets forth a list of all Software owned or licensed by any
Non-Company Affiliate, which is currently used in conducting the Company business in the United
States or any foreign country. Schedules 5.11.2(a) and 5.11.2(b) also set forth
the annual licensing fee owed by the Company to utilize said Software. The Company own, or have
the license or right to use all such Software currently used and necessary to conduct the business
of the Company as presently conducted, in the United States and in each foreign country where the
Company uses such Software.

          5.11.3. To the knowledge of RMO, (a) no Third Party is infringing upon, violating or
interfering with or otherwise engaging in the unlawful appropriation of any right, title, interest
of or the goodwill associates with any Intellectual Property which is owned by the Company, and (b)
within the last three years neither the Company nor any of the Affiliates has brought or threatened
a claim against any Third Party alleging that or otherwise has reason to believe that any
Intellectual Property owned by the Company or any of the Affiliates is being infringed upon,
violated or interfered with or unlawfully appropriated.

     5.12. Material Contracts

          5.12.1. Schedule 5.12 sets forth a true, correct and complete list, as of the date
hereof, of all material Contracts (other than Real Property Leases and other than those material
Contracts which will be superseded by the Contracts listed in Schedule 3.2) of the
following categories (collectively, the “Material Contracts”):

               5.12.1.1. any Contract (including any confidentiality agreements) between the Company and
one or more Major Customers;

               5.12.1.2. any Contract that by its terms limits or otherwise restricts the Company from
engaging or competing in any line of business or in any geographic area;

               5.12.1.3. any partnership agreement, joint venture agreement or non-wholly-owned limited
liability company operating agreement;

27

 

               5.12.1.4. any guaranty, surety bond or letter of credit issued or posted, as applicable, by
the Company in which the Company is the guarantor, indemnitor or reimbursing party, as applicable;

               5.12.1.5. any agreement requiring payment to any Person of a commission or fee other than in
the Ordinary Course of Business;

               5.12.1.6. any distributor, sales representative, independent contractor or similar
agreement;

               5.12.1.7. any agreement under which the Company or any of its officers or directors are
restricted from carrying on any business, or competing in any line of business, in the State where
the Company does business;

               5.12.1.8. any indenture, trust agreement, loan agreement or note to which the Company is a
party that involves or evidences outstanding indebtedness, obligation or liabilities for borrowed
monies;

               5.12.1.9. any agreement for the disposition of a material portion of the Company’s Assets
(other than the sale of inventory in the Ordinary Course of Business);

               5.12.1.10. any stand-alone indemnification agreement providing for indemnification obligations
on the part of the Company;

               5.12.1.11. any agreement for the acquisition of any of the properties, securities or other
ownership interest of the Company or the grant to any Person of any options, rights of first
refusal, exclusive negotiation or preferential similar rights to purchase any of such Assets,
properties, securities or other ownership interest; and

               5.12.1.12. any commitment or agreement to enter into or post any of the foregoing items of
this Section 5.12.1.

          5.12.2. For purposes of Section 5.12.1 above, a contract will be deemed “material” if it
obligates the Company to a liability in excess of Ten Thousand Dollars ($10,000.00).

          5.12.3. As of the date of this Agreement, RMO has made available to Parent true, correct and
complete copies of all written Material Contracts. Each Material Contract is in full force and
effect, and is valid and binding on the Company, the other parties thereto, and is enforceable
against the Company and the other parties thereto in accordance with the terms thereof, except as
enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance, fraudulent
transfer, reorganization, moratorium, applicable equitable principles or similar laws from time to
time in effect affecting the enforcement of creditors’ rights generally. Except as set forth in
Schedule 5.12, to RMO’s knowledge the Company has performed all material obligations
required to be performed by them to date under such Material Contract, and to RMO’s knowledge
neither the Company, nor any other party thereto is in Default under such Material Contract, nor to
RMO’s knowledge does any condition exist that with notice or lapse of

28

 

time would constitute a Default thereunder. No surety bond or letter of credit that
constitutes a Material Contract has been called or drawn upon.

   5.13. Labor Matters

     Except as set forth on Schedule 5.13, within the last three (3) years, (a) the Company
has not been the subject of any union activity, nor has there been any strike of any kind called
against the Company, nor has there been any lockout or work stoppage involving the Company, and (b)
the Company has not violated any applicable federal, state or provincial Law relating to labor or
labor practices. Except as set forth on Schedule 5.13, the Company is not a party to any
collective bargaining agreement.

   5.14. ERISA and Related Matters

          5.14.1. Schedule 5.14 sets forth a true, correct and complete list, as of the date
hereof, of all Company Plans. RMO has made available to Parent true, correct and complete copies
of the most recent summary plan descriptions, if any, with respect to the Company Plans.

          5.14.2. The Company does not contribute or have any obligation to contribute, and has not
within six (6) years prior to the date of this Agreement contributed or had an obligation to
contribute, to a multiemployer plan (within the meaning of Section 3(37) of ERISA) or a Benefit
Plan (other than a Member Plans) subject to Title IV of ERISA, Section 302 of ERISA or Section 412
of the Code.

          5.14.3. With respect to any “employee benefit plan,” within the meaning of Section 3(3) of
ERISA, that is not a Company Plan, and which is sponsored, maintained, or contributed to, or has
been sponsored, maintained, or contributed to within six (6) years prior to the date of this
Agreement, by the Company or any corporation, trade, business, or entity under common control with
the Company, within the meaning of Section 414(b), (c), or (m) of the Code or Section 4001 of
ERISA, to RMO’s knowledge: (a) no withdrawal liability, within the meaning of Section 4201 of
ERISA, has been incurred, which withdrawal liability has not been satisfied, (b) no liability to
the Pension Benefit Guaranty Corporation has been incurred by any such entity, which liability has
not been satisfied, (c) no accumulated funding deficiency, whether or not waived, within the
meaning of Section 302 of ERISA or Section 412 of the Code has been incurred, and (d) all
contributions (including installments) to such plan required by Section 302 of ERISA and Section
412 of the Code have been timely made.

          5.14.4. In connection with the consummation of the transactions contemplated by this
Agreement, to RMO’s knowledge no payments of money or other property, acceleration of benefits, or
provision of other rights have been or will be made hereunder, under any agreement contemplated
herein, or under any Company Plan that would be reasonably likely to be nondeductible under Section
280G of the Code, whether or not some other subsequent action or event would be required to cause
such payment, acceleration, or provision to be triggered.

   5.15. Guaranties or Bonds

     Schedule 5.15 sets forth a true, correct and complete list, as of the date hereof, of
all Guaranties or Bonds.

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   5.16. Employees

     Except as set forth on Schedule 5.16, the Company do not have any written or oral
contract with any individual currently engaged, or previously engaged, in the business of the
Company as an employee, independent contractor or otherwise. Schedule 5.16 sets forth a
true, correct and complete list, as of the date(s) set forth therein, of the names, position and
initial employment date of all current employees of the Company. No changes in such base pay for
such employees have been promised or authorized by the Company, except in the Ordinary Course of
Business or except as described in Schedule 5.16. Except as set forth in Schedule
5.16, there are no loans or other obligations payable or owing by the Company to any officer,
director or employee of the Company, except salaries, wages, vacation pay, bonuses and salary
advances and reimbursement of expenses incurred and accrued in the Ordinary Course of Business, nor
are any loans or debts payable or owing by any such individuals to the Company, nor has the Company
guaranteed any of such individuals’ respective loans or material obligations. The Company is not
(a) delinquent in the payment to any of its employees or independent contractors any wages,
salaries, commissions, bonuses or other direct compensation for any services performed by them or
amounts required to be reimbursed to such employees or consultants or any Taxes or any penalty for
failure to comply with any of the foregoing or (b) liable for any payment to any trust or other
fund or to any Governmental Authority, with respect to unemployment compensation benefits, social
security or other benefits or obligations for employees (other than routine payments to be made in
the Ordinary Course of Business and consistent with past practices). RMO is not aware and the
Company has not received notice that any employee or independent contractor of the Company intends
to terminate his or her employment relationship or engagement with the Company. RMO is not aware
and the Company has not received notice that any employee, director or officer of the Company is
obligated under any contract or subject to any judgment, decree or administrative order that would
conflict or interfere with (a) the performance of the Person’s duties as an employee, director or
officer of the Company, or (b) the business of the Company as conducted or proposed to be
conducted. Between the Effective Date and the Closing Date, no more than twenty percent (20%) of
the total employees engaged by the Company shall have resigned, been terminated for any reason, or
had their working hours materially reduced except in the Ordinary Course of Business.

   5.17. Environmental Matters

     Except as set forth in Schedule 5.17 to RMO’s knowledge:

          5.17.1. the Company and its respective operations are in material compliance with all
applicable Environmental Laws;

          5.17.2. the Company is not subject to any pending or threatened claim, action, suit,
investigation, inquiry or proceeding under any Environmental Law and there is no such action
proposed or threatened;

          5.17.3. all Permits, if any, required to be obtained by the Company under any Environmental
Law in connection with its respective operations as it is currently being

30

 

conducted, including those relating to the management of Hazardous Substances, have been
obtained by the Company, and are in full force and effect on the date hereof;

          5.17.4. there have been no releases of Hazardous Substances on any real property owned or
leased by the Company in connection with the operations of the Company that requires remediation
under applicable Environmental Laws;

          5.17.5. no real property formerly owned or leased by the Company in connection with the
operations of the operations and the Company has been contaminated with any Hazardous Substances
during or prior to such period of ownership or operation which could reasonably be expected to
result in liability relating to or requiring any remediation under the applicable Environmental
Laws;

          5.17.6. the Company is not subject to any order, decree, injunction or other arrangement with
any Governmental Authority or any agreement with any third party pursuant to which the Company is
indemnifying any third party for liability under any Environmental Laws; and

          5.17.7. RMO and the Company shall make available to Parent on a confidential basis all
environmental site assessment reports, studies and related documents in the possession of the
Company, RMO or any Non-Company Affiliate and relating to environmental matters in connection with
operation of the Assets.

   5.18. Insurance Coverage 

     Schedule 5.18 sets forth a true, correct and complete summary of all Company Insurance
Policies applicable to the Company and any surety bonds (if applicable) covering the Company, the
Assets, the business of the Company, and the employees of the Company, other than any such
insurance policies related to Benefit Plans. There is no claim by the Company pending under any
such policies or bonds as to which coverage has been questioned, denied or disputed by the
underwriters of such policies and bonds. All premiums due and payable under such policies and
bonds have been paid, and the Company is otherwise in material compliance with the terms and
conditions of all such policies and bonds. To the knowledge of RMO, there is no threatened
termination of such policies and bonds.

   5.19. Governmental Filings: No Violations

          5.19.1. Except as disclosed on the attached Schedule 5.19, to RMO’s knowledge no
notices, reports or other filings are required to be made by RMO or the Company with, nor are any
consents, registrations, approvals, permits or authorizations required to be obtained by RMO or the
Company from, any Governmental Authority in connection with the execution and delivery of this
Agreement by RMO or the Company and the consummation of the transactions contemplated hereby,
except those that the failure to make or obtain would not have a Material Adverse Effect.

          5.19.2. Subject to the filings, registrations, consents, approvals, permits, authorizations
and/or notices referred to in Schedule 5.19 and/or in Schedule 6.2, RMO’s and the
Company’s execution, delivery and performance of this Agreement and the consummation of the

31

 

transactions contemplated hereby will not constitute or result in (i) a breach or violation of
any provisions of the Organizational Documents of the Company, (ii) a breach or violation of any
Law of any Governmental Authority by which the Company is bound or (iii) a breach or violation of,
or a default under, the acceleration of any obligations under, or the creation of a Lien on the
assets of the Company (with or without notice, lapse of time or both) pursuant to, any Contract
binding upon the Company, except, in the case of clauses (ii) and (iii) above, for any breach,
violation, default, acceleration or creation that would not have a Material Adverse Effect.

     Except as disclosed on the attached Schedule 5.19, neither the RMO nor the Company
needs to provide any notice to, or obtain any Permits from any Governmental Authority for the
consummation of the transactions contemplated by this Agreement.

   5.20. Accounts Receivable

     Schedule 5.20 sets forth a true and correct list of all Accounts Receivable of the
Company as of the end of the business day on April 28, 2009. All Accounts Receivable represent
valid obligations and to RMO’s knowledge are not subject to any set offs or counterclaims. All
Accounts Receivable and all Accounts Receivable arising between the Effective Date and the Closing
Date are owned by the Company. Except as set forth in Schedule 5.20, no Account Receivable
has been outstanding for more than sixty (60) days. To RMO’s knowledge, the Company has not
received written notice from an account debtor stating that any Account Receivable in an amount in
excess of Ten Thousand Dollars ($10,000.00) is subject to any contest, claim or set off by such
account debtor. No discount or allowance from any Account Receivable has been made or agreed to.

   5.21. Gratuitous Payments

     Neither the Company, nor any of the directors, members, executives, independent contractors or
employees of the Company, nor any agents acting on behalf of or for the benefit of the Company,
directly or indirectly, has (i) offered or paid any remuneration, in cash or in kind, to, or made
any financial arrangements with, any past or present customers or third party payors of the
Company, or potential customers of the Company in order to obtain business from such customers,
other than standard pricing or discount arrangements consistent with proper legal and business
practices, (ii) given, or agreed to give, or is aware that there has been made, or that there is an
agreement to make, any gift or gratuitous payment of any kind, nature or description (whether in
money, property or services) to any customer, third party payor, supplier, source of financing,
landlord, sub-tenant, licensee or anyone else other than in connection with promotional or
entertainment activities consistent with proper legal and business practices, (iii) made, or has
agreed to make, or is aware that there has been made, or that there is any agreement to make, any
illegal political contribution or gift, or any contributions, payments or gifts of its funds or
property to, or for the private use of, any governmental official, employee or agent, where either
the contribution, payment or gift or the purpose of such contribution, payment or gift is illegal
under the laws of the United States, or under the laws of any state thereof or any other
jurisdiction (foreign or domestic) under which such payment or gift was made, (iv) established or
maintained any unrecorded fund or asset for any purpose, or has made any false or artificial
entries on any of its books or records for any reason or (v) made, or has agreed to make,

32

 

or is aware that there has been made, or that there is any agreement to make, any payments to
any person with the intention or understanding that any part of such payment was to be used for any
purpose other than that described in the documents supporting the payments. No notice or claim
inconsistent with the representations in this Section 5.21 has been received by the
Company.

   5.22. Disclosures

     Neither this Agreement, nor any other agreement entered into pursuant to the transactions
contemplated by this Agreement, nor any schedule, exhibit, report, document, certificate or
instrument prepared by and furnished by the Company and RMO to Parent or its counsel in connection
with the transactions contemplated by this Agreement contains or will contain any untrue statement
of a material fact or omits or will omit to state a material fact necessary in order to make the
statements contained herein or therein, in light of the circumstances under which they were made,
not misleading except to the extent that any such statement or omission will not be reasonably
likely to have a material effect on the business, financial condition, prospects, or operation of
the Company or Assets.

   5.23. Litigation

     Except as set forth in Schedule 5.8, there is no action, suit or proceeding at law or
in equity against the Company pending, or to the knowledge of RMO, threatened, which (a) relates to
or involves uninsured amounts of more than $5,000, (b) would, if decided adversely to RMO or the
Company, prohibit the transactions contemplated by this Agreement or (c) is reasonably likely to
have a Material Adverse Effect. The Company has not been permanently or temporarily enjoined or
barred by order, judgment or decree requiring the Company to take, or refrain from taking, action
with respect to its business.

   5.24. Brokers and Finders

     No broker or finder has been retained or employed by RMO or the Company in connection with the
transactions contemplated in this Agreement. The Company does not have, and will not have, any
financial obligation to any broker or finder.

   5.25. Regulatory Proceedings

     As of the date hereof, the Company, (a) has no rates which have been or are being collected
subject to refund, pending final resolution of any proceeding pending before a Governmental
Authority or on appeal to the Courts or (b) is not a party to any proceeding before a Governmental
Authority or on appeal from orders of a Governmental Authority which, in each case, has resulted or
would reasonably be expected to result in orders have a Material Adverse Effect.

	6.	 	REPRESENTATIONS AND WARRANTIES OF RMO REGARDING THE COMPANY AND THE COMPANY INTERESTS

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     RMO represents and warrants to Parent that except as otherwise set forth in this Agreement:

   6.1. Power and Authority; Enforceability

     RMO and the Company have all requisite power and authority to execute and deliver this
Agreement and the other documents, instruments and agreements to be entered into by it pursuant
hereto, to perform its obligations hereunder and thereunder, and to consummate the transactions
contemplated hereby and thereby. This Agreement has been duly and validly executed and delivered
by RMO and the Company, and, on the Closing Date, all other agreements to be entered into by RMO
and the Company pursuant hereto will have been duly and validly executed and delivered by RMO and
the Company. This Agreement is, and each and every agreement, document and instrument provided for
herein to be executed and delivered and to which RMO and the Company are a party will be, when
executed and delivered by the parties thereto, valid and binding on RMO and the Company and
enforceable against RMO and the Company in accordance with its respective terms, except as
enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency,
fraudulent conveyance, fraudulent transfer, reorganization, moratorium or similar Laws from time to
time in effect affecting the enforcement of creditors’ rights generally.

   6.2. No Violation or Conflict by RMO or the Company

     Except as set forth in Schedule 6.2, the execution, delivery and performance by RMO
and the Company of this Agreement and each and every other agreement, document and instrument to be
entered into by RMO and the Company pursuant hereto do not and will not, and the consummation of
the transactions contemplated hereby and thereby will not, constitute an occurrence of a Default or
require the consent or approval of any Person under any provision of any Material Contract to which
RMO or the Company are a party or by which they are bound.

   6.3. RMO and the Company Governmental Approvals

     Except as set forth in Schedule 5.19, the execution, delivery and performance by RMO
and the Company of this Agreement, and the other documents, instruments and agreements to be
entered into by RMO and the Company pursuant hereto, do not and will not, and the consummation of
the transactions contemplated hereby and thereby will not (a) violate any consent, judgment, order
or decree or any applicable rule or regulation of any Governmental Authority to which RMO, the
Company or any Non-Company Affiliate is a party or is subject to, (b) require of RMO, the Company
or any Non-Company Affiliate a filing or registration with any Governmental Authority, or (c)
require RMO, the Company or any Non-Company Affiliate to obtain any consent, approval, Permit,
certificate or order of any Governmental Authority under applicable Law or by any applicable
consent, judgment, order or decree or any applicable rule or regulation of any Governmental
Authority.

   6.4. Title to the Company Interests

     As of the Closing Date, RMO will collectively own, beneficially and of record, all of the
shares of Company Interest free and clear of any and all Liens except as set forth on Schedule
6.4. There are no outstanding subscriptions, options, warrants, rights of first refusal or
other

34

 

agreements or commitments, other than this Agreement, obligating RMO to transfer, or granting
an option or right by RMO to any Person to purchase or acquire from RMO the Company Interests or
any other securities of the Company.

   6.5. Litigation Against RMO or the Company

     Except as set forth in Schedule 6.5, to RMO’s knowledge there is no litigation, suit,
action, proceeding, claim or investigation pending or, to the knowledge of RMO, proposed or
threatened against RMO or the Company that (a) affects RMO, any Non-Company Affiliate, the Company,
or the Assets, and could, individually or in the aggregate, if pursued or resulting in a judgment
against RMO, reasonably be expected to materially adversely effect on the ability of RMO to
consummate the transactions described herein, or (b) seeks restraint, prohibition, or other
injunctive relief in connection with this Agreement or the consummation of the transactions
contemplated hereby. There is no judgment, decree, injunction, order, determination, award,
finding or letter of deficiency of any Governmental Authority or arbitrator outstanding against RMO
or the Company with respect to this Agreement.

   6.6. Taxes

     RMO has (i) timely extended or filed all Income Tax Returns known to RMO to be required to be
filed with respect to the Company and all such Income Tax Returns are true, correct and complete in
all material respects; (ii) paid, and until the Effective Time will, within the time and in the
manner prescribed by Law, pay, all Income Taxes known to RMO to be due and payable in respect of
such Income Tax Returns related to the Company except those being contested in good faith; (iii)
RMO has not executed or filed with any taxing authority (whether federal, state, local or foreign)
any agreement or other document (other than normal requests to extend the time for filing a Income
Tax Return) extending or waiving or having the effect of extending or waiving the period for
assessment of any Income Tax that is due with respect to a Income Tax Return related to the Company
and is required to file; (iv) no federal, state, local or foreign Income Tax Audits or other
administrative proceeding, discussions or court proceedings are presently in progress with regard
to any Income Tax Returns related to the Company; and (v) there are no Liens for Income Taxes upon
the Assets of the Company. RMO acknowledges that the Company is treated for federal Income Tax
purposes as “disregarded as an entity separate from its owner” pursuant to Section
301.7701-3(b)(1)(ii) of the Treasury Regulations.

   6.7 Investment

     RMO is receiving the Parent Common Stock as the Merger Consideration pursuant to the exemption
provided by Section 4(2) of the Securities Act of 1933, as amended, and has made, independently and
without reliance on Parent (except to the extent that RMO has relied upon the representations and
warranties of Parent contained herein), his own analysis of Parent Common Stock, and RMO has had
reasonable and sufficient access to such documents and other information and materials as he
considers appropriate to make his necessary evaluation. RMO is acquiring Parent Common Stock
solely for his own account for investment and not with a view to or for the distribution thereof.
RMO acknowledges that Parent Common Stock to be issued to him in connection with the Mergers is not
registered under the Securities Act of 1933, as amended, and that such Parent Common Stock may not
be transferred or sold except pursuant to

35

 

the registration provisions of the Securities Act of 1933, as amended, or pursuant to an
applicable exemption therefrom. RMO is able to bear the economic risk of his investment in Parent
Common Stock pursuant to this Agreement, and has sufficient knowledge and experience in financial
and business matters in that he is capable of evaluating the merits and risks of the acquisition of
Parent Common Stock, and RMO is able to financially bear the risk thereof.

	7.	 	REPRESENTATIONS AND WARRANTIES OF PARENT

     Parent represents and warrants to RMO and the Company that:

   7.1. Organization and Standing

     Parent is a corporation duly incorporated, validly existing and in good standing under the
laws of the State of Montana.

   7.2. Corporate Power and Authority; Enforceability

     Parent has all requisite corporate power and authority to execute and deliver this Agreement
and the other documents, instruments and agreements to be entered into by it pursuant hereto, to
perform its obligations hereunder and thereunder, and to consummate the transactions contemplated
hereby and thereby. The execution, delivery and performance by Parent of this Agreement and each
and every other agreement, document and instrument to be executed, delivered and performed by
Parent in connection herewith have been duly authorized and approved by all requisite corporate
action on the part of Parent. This Agreement has been duly and validly executed and delivered by
Parent, and, on the Closing Date, all other agreements to be entered into by Parent pursuant hereto
will have been duly and validly executed and delivered by Parent. This Agreement is, and each and
every agreement, document and instrument provided for herein to be executed and delivered and to
which Parent is a party will be, when executed and delivered by the parties thereto, valid and
binding on Parent, and enforceable against Parent in accordance with their respective terms, except
as enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency,
fraudulent conveyance, fraudulent transfer, reorganization, moratorium or similar Laws from time to
time in effect affecting the enforcement of creditors’ rights generally.

   7.3. No Violation or Conflict by Parent

     Except as set forth in Schedule 7.3, the execution, delivery and performance by Parent
of this Agreement and each and every other agreement, document and instrument to be entered into by
Parent pursuant hereto do not and will not, and the consummation of the transactions contemplated
hereby and thereby will not, conflict with or violate any provisions of the articles of
incorporation or the bylaws of Parent, or constitute an occurrence of Default or require the
consent or approval of any Person under any provision of any contract or agreement to which Parent
is a party or by which it is bound.

   7.4. Parent Governmental Approvals

     Except as set forth in Schedule 7.4, the execution, delivery and performance by Parent
of this Agreement, and the other documents, instruments and agreements to be entered into by

36

 

Parent pursuant hereto, do not and will not, and the consummation of the transactions
contemplated hereby and thereby will not (a) violate any consent, judgment, order or decree or any
rule or regulation of any Governmental Authority to which Parent or any Affiliate of Parent is a
party or is subject to, (b) require of Parent or any Affiliate of Parent a filing or registration
with any Governmental Authority, or (c) require Parent or any Affiliate of Parent to obtain any
consent, approval, Permit, certificate or order of any Governmental Authority under applicable Law
or by any applicable consent, judgment, order or decree or any applicable rule or regulation of any
Governmental Authority.

   7.5. Litigation Against Parent

     There is no litigation, suit, action, proceeding, claim or investigation pending or, to the
knowledge of Parent, proposed or threatened against Parent that (a) affects Parent or any Affiliate
of Parent and could, individually or in the aggregate, if pursued or resulting in a judgment
against Parent or such Affiliate, reasonably be expected to materially adversely effect the ability
of Parent to consummate the transactions described herein, or (b) seeks restraint, prohibition, or
other injunctive relief in connection with this Agreement or the consummation of the transactions
contemplated hereby. There is no judgment, decree, injunction, order, determination, award,
finding or letter of deficiency of any Governmental Authority or arbitrator outstanding against
Parent with respect to this Agreement.

   7.6. Purchase for Investment

     Parent is acquiring the Company Interests pursuant to the exemption provided by Section 4(2)
of the Securities Act of 1933, as amended, and has made, independently and without reliance on RMO
(except to the extent that Parent has relied upon the representations and warranties of RMO
contained herein), its own analysis of the Company Interest, the Company and the Assets for the
purpose of acquiring the Company Interests, and Parent has had reasonable and sufficient access to
such documents and other information and materials as it considers appropriate to make its
necessary evaluation. Parent is acquiring the Company Interests solely for its own account for
investment and not with a view to or for the distribution thereof. Parent acknowledges that the
Company Interests are not registered under the Securities Act of 1933, as amended, and that none of
the Company Interests may be transferred or sold except pursuant to the registration provisions of
the Securities Act of 1933, as amended, or pursuant to an applicable exemption therefrom. Parent
is able to bear the economic risk of its investment in the Company Interests pursuant to this
Agreement, and has sufficient knowledge and experience in financial and business matters in that it
is capable of evaluating the merits and risks of the acquisition of the Company Interests, and
Parent is able to financially bear the risk thereof.

   7.7. Knowledge of Inaccuracies 

     Parent shall promptly notify RMO and the Company if at any time prior to the Closing Parent
acquires knowledge of any inaccuracy in any of the representations made by the RMO in this
Agreement, provided, however, that Parent’s failure to inform RMO shall not be considered a breach
hereunder.

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   7.8. Investigations

     Parent acknowledges that it has been furnished with and has an opportunity to read this
Agreement to which it is a party and all materials relating to the Company and the Assets that have
been requested by Parent. Parent further acknowledges that it has been given ample opportunity to
ask questions and request information of, and receive answers from RMO concerning the Company and
the Assets, including but not limited to information relating to the business, finances, operations
and prospects of the Company.

	8.	 	CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT

     The obligations of Parent to consummate the Merger and the transactions contemplated by this
Agreement shall be subject to the satisfaction, on or before the Closing, of each and every one of
the following conditions, all or any of which may be waived, in whole or in part, by Parent for
purposes of consummating the Merger and such other transactions:

   8.1. Representations True at the Closing

     The representations and warranties made by RMO or of RMO on behalf of the Company in this
Agreement shall be true and correct in all material respects when made, and immediately prior to
the Closing with the same force and effect as though such representations and warranties had been
made as of such time.

   8.2. Covenants of RMO

     RMO and the Company shall have duly performed in all material respects all of the covenants,
acts and undertakings to be performed by them respectively on or prior to the Closing pursuant to
the Agreement, and a duly authorized officer of the Company, and RMO himself shall have delivered
to Parent a certificate in the form attached hereto as Exhibit A dated as of the Closing
Date certifying to the fulfillment of this condition and the condition set forth in Section
8.1.

   8.3. No Injunction, Etc.

     No action, proceeding, investigation, regulation or legislation shall have been instituted or
threatened by any Person other than Parent or any Affiliate of Parent before any court or
Governmental Authority to enjoin, restrain, or prohibit the consummation of the Merger or the
transactions contemplated hereby.

   8.4. Consents, Approvals and Waivers

     RMO and the Company’s execution and delivery of this Agreement and consummation of the
transactions contemplated hereby shall have been approved by (a) all Governmental Authorities, (b)
all of RMO and the Company’s lenders whose approval is required under any applicable loan
documents, and (c) Parent’s lenders, LaSalle Bank N.A. and the holders of those current unsecured
bond debt notes due June 29, 2017, but only if such lender approvals are required under the
applicable loan documents, and no such approvals, independently or in the aggregate, shall have
resulted in a Material Adverse Effect on the regulatory treatment of the

38

 

Company. In addition, this Agreement shall have been approved by the special committee of the
board of directors of Parent, the board of directors of Parent (other than Richard M. Osborne in
his individual capacity, and Thomas J. Smith), and Parent’s shareholders. Either (i) Parent shall
have received a true, correct and complete copy of each consent, approval, waiver and agreement
required to be obtained by RMO and the Company no later than the Closing pursuant to Section
3.3, or (ii) if RMO and the Company were unable to obtain such consent, approval, waiver or
agreement after having complied with their obligations under Section 3.3, RMO shall have
obtained for, or provided Parent with, in a form reasonably acceptable to Parent, the economic
practical benefit to Parent as if such consent, approval, waiver or agreement had been received.

   8.5. Absence of Material Adverse Effect

     No Material Adverse Effect that is not as of the Effective Date hereof contained in a schedule
shall have occurred between the Effective Date and the Closing Date.

   8.6 Consummation of Mergers pursuant to the Other Merger Agreement

     The mergers and other transactions contemplated by the Other Merger Agreement shall have been
consummated.

	9.	 	CONDITIONS PRECEDENT TO THE OBLIGATIONS OF RMO AND THE COMPANY

     The obligations of RMO and the Company to consummate the Merger and the transactions
contemplated by this Agreement shall be subject to the satisfaction, on or before the Closing, of
each and every one of the following conditions, all or any of which may be waived, in whole or in
part, by RMO and the Company for purposes of consummating the Merger and such other transactions:

   9.1. Representations True at Closing

     The representations and warranties made by Parent in this Agreement shall be true and correct
in all material respects when made, and immediately prior to the Closing with the same force and
effect as though such representations and warranties had been made on and as of such time.

   9.2. Covenants of Parent

     Parent shall have duly performed in all material respects all of the covenants, acts and
undertakings to be performed by it on or prior to the Closing pursuant to the Agreement, and the
President of Parent shall have delivered to RMO and the Company a certificate in the form attached
hereto as Exhibit B dated as of the Closing Date certifying to the fulfillment of this
condition and the condition set forth in Section 9.1.

   9.3. No Injunction, Etc.

     No action, proceeding, investigation, regulation or legislation shall have been instituted or
threatened by any Person other than RMO, the Company or any Non-Company Affiliate

39

 

before any court or Governmental Authority to enjoin, restrain or prohibit the consummation of
the Merger and the transactions contemplated hereby.

   9.4. Consents, Approvals and Waivers

     Parent’s execution and delivery of this Agreement and the consummation of the Merger and the
transactions contemplated hereby shall have been approved by (a) the special committee of the board
of directors of Parent, the board of directors of Parent (other than Richard M. Osborne in his
individual capacity, and Thomas J. Smith), and approval by Parent’s shareholders, (b) all
Governmental Authorities whose approvals are required by Law, (c) Parent’s lenders, LaSalle Bank
N.A. and the holders of those current unsecured bond debt notes due June 29, 2017, but only if such
lender approvals are required under the applicable loan documents, and (d) all of RMO’s and the
Company’s lenders whose approval is required under any applicable loan documents. RMO and the
Company shall have received a true, correct and complete copy of each consent, approval, waiver and
agreement required to be obtained by Parent no later than the Closing pursuant to Section
3.3. RMO’s and the Company’s execution and delivery of this Agreement and the consummation of
the Merger and the transactions contemplated hereby shall have been approved by all Governmental
Authorities whose approvals are required by Law, except for any such approval which could not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on the
ability of RMO and the Company to consummate the Merger and the transactions described herein.

   9.5 Consummation of Mergers pursuant to the Other Merger Agreement

     The mergers and other transactions contemplated by the Other Merger Agreement shall have been
consummated.

	10.	 	TRANSACTIONS AT CLOSING

   10.1. Transactions at Closing

     At the Closing, each of the following shall occur:

          10.1.1. RMO’s and the Company’s Performance. At the Closing, RMO and the Company
shall deliver to Parent each of the following:

               10.1.1.1. all certificates representing the Company Interests or, if applicable, replacement
certificates together with lost certificate affidavits and indemnifications (in form and substance
reasonably acceptable to Parent), duly endorsed for transfer or accompanied with executed blank
stock powers (in form and substance reasonably acceptable to Parent), together with a new
certificate representing such shares issued in the name of Parent;

               10.1.1.2. original stock ledgers, articles of incorporation, certificates of incorporation,
charters, certificates of formation, bylaws, joint venture agreements, partnership agreements,
limited liability company operating agreements, and board of directors’, and members’ minutes of
the Company;

               10.1.1.3. the certificate of RMO as described in Section 8.4;

40

 

               10.1.1.4.    evidence of the consents, approvals, waivers and agreements described in
Section 8.4 in a form reasonably satisfactory to Parent;

               10.1.1.5.   certificate of existence or good standing of the Company, as of the most recent
practicable date, from the appropriate Governmental Authority of the jurisdiction of its respective
incorporations or formations and the jurisdictions in which each is qualified to do business;

               10.1.1.6.    resignations, or evidence of termination of his or her office, by each director,
manager, and officer of the Company, unless otherwise agreed by the parties;

               10.1.1.7.   such other evidence of the performance of all covenants and satisfaction of all
conditions required of RMO or the Company by this Agreement, at or prior to the Closing, as Parent
may reasonably require;

               10.1.1.8. all books and records relating to the operation of the Company, including but not
limited to all such electronic records, files, ledgers and other documentation reasonably required
by Parent in connection with the ongoing operation of the Company; and

               10.1.1.9. any acknowledgments or consents of any lender’s of Assumed Debt.

     10.1.2. Parent’s Performance. At the Closing, Parent shall deliver to RMO each of the
following:

               10.1.2.1.   the certificate of the President of Parent described in Section 9.2;

               10.1.2.2.   certificates of existence or good standing of Parent and the Acquisition Sub, as
of the most recent practicable date, from the appropriate Governmental Authority of the
jurisdiction of its incorporation;

               10.1.2.3.   Secretary or Assistant Secretary certified copies of resolutions of the board of
directors of Parent approving the transactions contemplated by this Agreement;

               10.1.2.4.   Secretary or Assistant Secretary certificates of incumbency for the officers of
Parent who sign on behalf of Parent this Agreement and any other documents, instruments or
agreements to be entered into by Parent pursuant hereto;

               10.1.2.5.     such other evidence of the performance of all covenants and satisfaction of all
conditions required of Parent by this Agreement, at or prior to the Closing, as RMO or the Company
may reasonably require; and

               10.1.2.6. a receipt of Parent evidencing Parent’s receipt of the Company Interests.

11. SURVIVAL OF REPRESENTATION AND WARRANTIES; INDEMNIFICATION

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     11.1. Survival of Representations, Warranties and Agreements

               11.1.1. All representations, warranties, covenants, indemnities and obligations made or
undertaken by RMO in this Agreement are material, have been relied upon by Parent and shall survive
the Closing hereunder as set forth in Section 11.5, and shall not merge in the performance
of any obligation by any party hereto.

               11.1.2. All representations, warranties, covenants, indemnities and obligations made or
undertaken by Parent in this Agreement are material, have been relied upon by RMO and shall survive
the Closing hereunder as set forth in Section 11.5, and shall not merge in the performance
of any obligation by any party hereto.

     11.2. Agreements to Indemnify Parent Indemnitees

               11.2.1. Subject to the other provisions of this Section 11 and subject to Section
5.25, RMO hereby agrees to indemnify and hold harmless Parent, each Affiliate of Parent, their
respective directors and officers, and their respective successors and assigns (collectively,
“Parent Indemnitees”), from and against any and all liability, obligation, loss, Lien,
damage, injury, cost and expense (including reasonable attorneys’ fees and costs and expenses
related thereto) (collectively, “Losses”) suffered or incurred by any Parent Indemnitee
arising from: (a) any material breach of any indemnity, covenant, representation or warranty of RMO
contained in this Agreement, (b) any misrepresentation in the certificate delivered at the Closing
pursuant to Section 8.2, (c) the Member Plans, (d) all Taxes of the Company (including
Taxes of any other Person for which the Company is liable under Treasury Regulation section
1.1502-6 or similar provision of foreign, state or local law) for periods (or portions thereof)
ending on or prior to the Closing Date to the extent such Taxes exceed the Accrued Tax Liability;
or (e) any Scheduled Claim, which claims the parties acknowledge and agree that RMO has
acknowledged his duty to defend in accordance with Section 11.6.2 and, thereby, RMO has a
right to control the defense of in accordance with the provisions of Section 11.6.2

               11.2.2. For all purposes of this Section 11, after the Closing, any Loss suffered or
incurred by the Company arising from any breach of any indemnity, covenant, representation or
warranty by RMO referenced in Section 11.2.1 shall be deemed suffered and incurred by
Parent for purposes of such Section 11.2.1, and Parent shall be entitled to seek
indemnification under such Section 11.2.1 against RMO alone for any such Loss.

     11.3. Agreements to Indemnify the RMO Indemnitees

     Subject to the other provisions of this Section 11, Parent hereby agrees to indemnify
and hold harmless RMO, each Non-Company Affiliate, their respective directors and officers, and
their respective successors and assigns (collectively, the “RMO Indemnitees”), from and
against all Losses suffered or incurred by any RMO Indemnitee arising from: (a) any material breach
of any indemnity, covenant, representation, or warranty of Parent contained in this Agreement, (b)
any misrepresentation in the certificate delivered at the Closing pursuant to Section 9.2,
or (c) any Taxes incurred as a result of any transaction engaged in by the Company after the
Closing.

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   11.4. Recoveries

     The determination of the amount of any Loss for purposes of this Section 11 shall take
into account the amount of insurance proceeds payable with respect thereto pursuant to any Third
Party insurance policy, but only to the extent such amounts are actually paid to the Indemnified
Party.

   11.5. Survival

          11.5.1. All claims by a Parent Indemnitee for indemnification pursuant to this Section
11 resulting from breaches of representations or warranties herein shall be forever barred
unless RMO is notified:

               11.5.1.1.   in the case of a claim based upon a breach of Section 5.4 with respect to
any taxable period ending on or prior to the Closing Date, within the statutory period of
limitations (including any extensions thereof), unless such claim is raised by the taxing authority
by way of an offset against any claim or suit for refund by or on behalf of the Company, or
pursuant to the mitigation provisions contained in the Code or any applicable statutes, in which
case a claim may be made within one (1) year after such offset or assessment; or

               11.5.1.2. in all other cases within eighteen (18) months after the Closing Date;
provided that if written notice for a claim of indemnification has been given by
Parent pursuant to Section 11.6.1 on or prior to the last day of the foregoing 18-month
period, then the obligation of RMO to indemnify any Parent Indemnitee pursuant to this Section
11 shall survive with respect to such claim until such claim is finally resolved;
provided, further, however, that claims based upon a breach of Section
5.2.1, Section Error! Reference source not found., the first three sentences of
Section 6.1, or Section 6.4 may be brought at any time within the statute of
limitations that applies to such claim or claims.

          11.5.2. All claims by a RMO Indemnitee for indemnification pursuant to this Section 11
resulting from breaches of representations or warranties herein shall be forever barred unless
Parent is notified within eighteen (18) months after the Closing Date; provided
that if written notice for a claim of indemnification has been given by RMO on behalf of
any RMO Indemnitee pursuant to Section 11.6.1 on or prior to the last day of the foregoing
twelve (12) month period, then the obligation of Parent to indemnify any RMO Indemnitee pursuant to
this Section 11 shall survive with respect to such claim until such claim is finally
resolved; provided, further, however, that claims based upon a breach of
the first three sentences of Section 7.2 may be brought at any time within the statute of
limitations that applies to such claim or claims.

   11.6. Notice and Defense of Actions

     The obligations and liabilities of each Indemnifying Party hereunder shall be subject to the
following terms and conditions:

               11.6.1. Notice. Except with respect to any Scheduled Claim, the Indemnified Party
shall give written notice to the Indemnifying Parties promptly after it becomes aware of any claim,
action or proceeding (each, an “Action”) as to which indemnity may be

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sought under this Section 11; provided that in any event, the
Indemnified Parties shall give written notice of an Action within thirty (30) days after being
served with the related process or legal proceeding. Such notice shall state the nature and basis
of such claims or events and the amounts thereof, to the extent known, and shall attach copies of
any complaint, demand or arbitration notice received by the Indemnified Party. Such notice shall
be given in accordance with Section 13.1. The failure of the Indemnified Party to give
notice as provided herein shall relieve the Indemnifying Party of any obligation under this
Section 11 only if and to the extent that such failure materially prejudices the ability of
the Indemnifying Party to defend such Action, and such failure shall in no event relieve the
Indemnifying Party of any liability that the Indemnifying Party may have to the Indemnified Party
otherwise under this Section 11.

          11.6.2. Defense of Actions.

               11.6.2.1.   (a)  Except with respect to any Scheduled Claim, in the event that the
Indemnifying Parties acknowledge in writing a duty to defend with respect to such Action, the
Indemnifying Parties shall have the right, at their expense, to control the defense of any such
Action. If the Indemnifying Parties wish to control the defense of such Action, they shall deliver
written notice thereof to the Indemnified Parties within sixty (60) days after receipt of the
notice described in Section 11.6.1. After such notice, the Indemnifying Parties shall
engage independent internal or external legal counsel (and reasonably acceptable to the Indemnified
Parties) to assume the defense of such Action; provided, however, that the
Indemnified Party may also participate in such defense, at its own expense; and provided,
further, that any Indemnifying Party shall not be entitled to assume the defense or
control of any Action if (i) the Indemnifying Party fails to acknowledge its duty to defend as set
forth in the preceding sentence, (ii) the Indemnified Party agrees, in writing, to assume the
defense of such Action and forego any indemnity claimed under this Section 11, (iii) in the
reasonable opinion of legal counsel for the Indemnified Party, such Action involves the potential
imposition of a criminal liability on the Indemnified Party, its directors, officers, employees or
agents, (iv) in the reasonable opinion of legal counsel for the Indemnified Party, an actual or
potential conflict of interest exists where it is advisable for such Indemnified Party to be
represented by separate legal counsel, or (v) with respect to Parent only, failure to stay the
enforcement of such Action will result in the imminent risk of sale, forfeiture or loss of all or
any material portion of the Assets or a material disruption in the operation of the acquired
business. In the circumstances identified in the foregoing subsections 11.6.2(a)(i)
through (v), the Indemnified Party shall be entitled to control and assume responsibility
for the defense of such Action, at the cost and expense of the Indemnifying Party. The
Indemnifying Party may, in any event, participate in such proceedings at its own cost and expense.

                    (b) With respect to any Scheduled Claim, RMO shall have the right and obligation, at his
expense, to control the defense of such Scheduled Claim. Parent also may participate in such
defense, at its own expense. RMO shall have the right to select and engage internal or external
legal counsel (which shall be reasonably acceptable to Parent if selected and engaged after the
date of this Agreement) to assume the defense of such Scheduled Claim. From and after the
Effective Date, the cost of the defense of all Scheduled Claims and any claims that arise or are
filed between the Effective Date and the Closing Date shall be borne by the Parent provided,
however, the cost of the defense of any claims that arise after the date of this Agreement, but
before the Closing Date, shall be borne by RMO.

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               11.6.2.2.   The Indemnifying Party, in the defense of any such Action, shall have the right in
its sole discretion to settle such Action only if (a) settlement involves only the payment of money
and execution of appropriate releases of the Indemnified Party and its Affiliates, as the case may
be, (b) there is no finding or admission of any violation of Law or violation of the rights of any
Person by the Indemnified Party or its Affiliates, as the case may be, and (c) the Indemnified
Party or its Affiliates, as the case may be, will have no liability with respect to such compromise
or settlement. Otherwise, no such Action shall be settled or agreed to without the prior written
consent of the Indemnified Party (which consent shall not be unreasonably withheld, delayed or
conditioned). If the Indemnified Party withholds, delays or conditions its consent in an
unreasonable manner, the Indemnified Party shall not be entitled to indemnification under this
Section 11 for any Loss in excess of the amount for which the Action could reasonably have
been compromised but for such withholding, delay or conditioning of consent.

               11.6.2.3.   Except with respect to any Scheduled Claim, in the event that the Indemnifying
Parties shall not agree in writing to assume the defense of such Action or in the event the
Indemnified Party assumes control of such Action pursuant to Section 11.6.2, the
Indemnified Parties may engage internal or external legal counsel acceptable to them to assume the
defense and may contest, pay, settle or compromise any such Action on such terms and conditions
reasonably acceptable to the Indemnified Parties. If the Indemnifying Parties are obligated to
indemnify the Indemnified Parties in respect to such Action under this Agreement, the fees and
expenses of such counsel retained by the Indemnified Parties shall constitute litigation expenses
subject to indemnification under this Section 11.

               11.6.2.4.   In the defense of any Action, regardless of who is in control, the Indemnified
Parties and the Indemnifying Parties shall fully cooperate in good faith in connection with such
defense and shall cause their legal counsel, accountants and Affiliates to do so, and shall make
available to the other party all relevant books, records, and information (in such Person’s
control) during normal business hours, and shall furnish to each other, at the Indemnifying Party’s
expense, such other assistance as the other party may reasonably require in connection with such
defense.

   11.7. Exclusive Remedy

     Except for remedies that cannot be waived as a matter of law and remedies available for
breaches under Section 13.2, the indemnification obligations under this Section 11
shall be the sole and exclusive remedies of the parties hereto with respect to any breach of any
representation, warranty, covenant, indemnity, or agreement under this Agreement or any certificate
delivered pursuant hereto by any party hereto, except that nothing contained herein shall be
construed as limiting or impairing the rights and remedies that the parties hereto may have at
equity for injunctive relief and specific performance, including such equitable remedies with
respect to enforcement of rights and obligations under Sections 2, 3.4.2, 4.3, 4.4 and 4.5.

   11.8. Treatment

     All indemnification payments under this Agreement shall be treated as adjustments to the
Merger Consideration.

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12. TERMINATION

   12.1. Method of Termination

     This Agreement constitutes the binding and irrevocable agreement of the parties hereto to
consummate the transactions contemplated hereby subject to the terms and conditions contained
herein, the consideration for which is the covenants set forth in Sections 2, 3 and
4, and expenditures and obligations incurred and to be incurred by Parent, on the one hand,
and by RMO and the Company, on the other hand, in respect of this Agreement, and this Agreement may
be terminated or abandoned only as follows:

          12.1.1. By the unanimous written consent of RMO and Parent, notwithstanding prior approval (if
any) by the board of directors of either Parent or the Company;

          12.1.2. If any condition to the Closing under Sections 8 and 9 has not been
satisfied (or waived) by 5:00 p.m. on the one (1) year anniversary of the Effective Date or at such
other time and date as may be mutually agreed upon by the parties in writing, RMO may terminate
this Agreement by written notice given to Parent if RMO has neither (a) proximately contributed to
the occurrence of the failure to satisfy the conditions set forth in Sections 8 and
9 by such date, nor (b) failed to use its commercially reasonable efforts to satisfy the
conditions set forth in Sections 8 and 9;

          12.1.3. If any condition to the Closing under Sections 8 and 9 has not been
satisfied (or waived) by 5:00 p.m. on the one (1) year anniversary of the Effective Date or at such
other time and date as may be mutually agreed upon by the parties in writing, Parent may terminate
this Agreement by written notice given to RMO and the Company if Parent has neither (a) proximately
contributed to the occurrence of the failure to satisfy the conditions set forth in Sections
8 and 9 by such date, nor (b) failed to use its commercially reasonable efforts to
satisfy the conditions set forth in Sections 8 and 9; or

          12.1.4. By either RMO or Parent if (a) there shall be any Law that makes consummation of the
transactions contemplated herein illegal or otherwise prohibited; or (b) any judgment, injunction,
order or decree permanently enjoining any of the parties hereto from consummating the transactions
contemplated herein is entered and such judgment, injunction, order or decree shall become final
and non-appealable.

Notwithstanding anything in this Section 12.1 to the contrary, no party hereto that is in
breach of a material obligation under this Agreement shall be entitled to terminate this Agreement
except with the prior written consent of the other party hereto.

     12.2. Procedure and Effect of Termination

          12.2.1. In the event of a termination by any party pursuant to and in accordance with
Section 12.1, such terminating party shall give prompt written notice thereof as provided
therein to the other party, and the transactions contemplated hereby shall be abandoned and
terminated, without further action by any of the parties hereto, except as provided in Section
12.2.1.

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          12.2.2. In the event of a termination pursuant to Section 12.1:

               12.2.2.1.   All filings, applications and other submissions relating to the consummation of
the transactions contemplated herein shall, to the extent practicable, be withdrawn from the
Governmental Authority or other Person to which made; and

               12.2.2.2.   No party hereto, or any of its Affiliates, nor any shareholder, member, partner,
director, officer, employee, or agent of any such party or any of its Affiliates, shall have any
liability or further obligation to any other party hereto or any of its Affiliates, nor to any
shareholder, member, partner, director, officer, employee, or agent of such other party or any of
its Affiliates pursuant to this Agreement, except (a) that the provisions of Sections
3.4.2, 12.2, 13.2, and 13.3  (and associated defined terms) shall
survive any such termination and not be extinguished thereby, provided that the
provisions of Section 3.4.2 shall terminate on the later of the second anniversary of such
termination or the date the Confidential Information loses its status as a trade secret or no
longer qualify as confidential under applicable Law; and (b) any party hereto nevertheless shall be
entitled to seek any remedy to which it may be entitled at law or in equity for the violation or
breach by the other party hereto of any agreement, covenant, indemnity, representation or warranty
contained in this Agreement that occurs prior to the termination.

13. GENERAL PROVISIONS

   13.1. Notices

     All notices, demands and requests hereunder by any party hereto to the other party hereto
shall be in writing, and shall be delivered by hand, nationally recognized overnight courier,
facsimile, or registered or certified mail, return receipt requested, first class postage prepaid,
addressed as follows:

13.1.1. If to RMO:

Richard M. Osborne

8500 Station St., Suite 113

Mentor, OH 44060

Facsimile No. (440) 255-8645

and copies to legal counsel to RMO:

Dworken & Bernstein Co., LPA

60 South Park Place

Painesville, OH 44077

Attn: Melvyn E. Resnick and Jodi Littman Tomaszewski

Facsimile No.: (440) 352-3469

13.1.2. If to Parent:

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Energy West Incorporated

P.O. Box 2229

Great Falls, MT 59403

Attn: Kevin Degenstein, President and Chief Operating Officer

Facsimile No.: (406) 791-7560

and copies to legal counsel to Parent:

Kohrman, Jackson & Krantz., PLL

1375 E. Ninth Street

One Cleveland Center

Twentieth Floor

Cleveland, Ohio 44114

Attn: Marc Krantz

Facsimile No.: (216) 621-6536

and

McCarthy, Lebit, Crystal & Liffman Co., L.P.A.

101 West Prospect Avenue, Suite 1800

Cleveland, Ohio 44115-1088

Attn: Kenneth B. Liffman

Facsimile No. (216) 696-1210

          13.1.3. If delivered by hand or nationally recognized overnight courier, the day on which a
notice, demand or request is delivered shall be the date on which such delivery is made, if
delivered by facsimile, the day upon which sender receives from its facsimile machine the correct
answerback of the addressee and confirmation of uninterrupted transmission by a transmission report
or the recipient confirming by telephone to the sender that the recipient has received the
facsimile message shall be the date on which such delivery is made (provided a hard copy of such
transmission is dispatched by first class mail within 48 hours), and, if delivered by mail, the day
on which such notice, demand or request is received shall be the date of delivery; provided
that a notice given in accordance with this Section 13.1 but received on any day
other than a Business Day or after business hours in the place of receipt, will be deemed to be
received on the next Business Day in that place.

          13.1.4. Any party hereto may change its address or facsimile number specified for notices
herein by designating a new address or facsimile number for notices by notice to the other party in
accordance with this Section 13.1.

     13.2. Brokers

               13.2.1. Parent represents and warrants to RMO and the Company that no investment banker,
broker or finder has acted for Parent in connection with this Agreement or the transactions.
Parent hereby agrees to indemnify and hold harmless RMO and the Company and their respective
Affiliates against any fee, loss or expense arising out of any claim by any

48

 

investment banker, broker or finder employed or alleged to have been employed by Parent or any
of its Affiliates in connection with this Agreement or the transactions contemplated herein.

               13.2.2. RMO represent and warrant to Parent that no investment banker, broker or finder has
acted for RMO or the Company or any of their Affiliates in connection with this Agreement or the
transactions contemplated herein. RMO hereby agrees to indemnify and hold harmless Parent, any
Affiliate of Parent, and, after the Closing, the Company, against any fee, loss or expense arising
out of any claim by any investment banker, broker or finder employed or alleged to have been
employed by RMO, the Company or any of their Affiliates in connection with this Agreement or the
transactions contemplated herein.

   13.3. Expenses

     All expenses incurred by a party hereto in connection with or related to the authorization,
preparation, negotiation and execution of this Agreement and the Closing of the transactions
contemplated hereby, including all fees and expenses of agents, representatives, legal counsel,
accountants and other technical consultants employed by such party, shall be borne solely and
entirely by the party that has incurred the same (except as otherwise expressly provided herein),
and provided that all expenses incurred by RMO shall be paid by RMO, as opposed to the Company.

   13.4. Further Assurances

     Each party covenants that at any time, and from time to time, after the Closing, it will
execute such additional instruments and take such actions as may be reasonably requested by the
other party to confirm or perfect or otherwise to carry out the intent and purposes of this
Agreement.

   13.5. Attribution of Knowledge

     With respect to any representation or warranty set forth in this Agreement or any other
agreements, certificates or instruments delivered pursuant hereto that is expressly qualified by:
(a) the phrase “to the knowledge of RMO” or “to the best knowledge of RMO” and variations thereof
when used with respect to RMO shall refer to matters actually known, and not constructively known,
to RMO; and (b) the phrase “to the knowledge of Parent” or “to the best knowledge of Parent” and
variations thereof when used with respect to Parent shall refer only to matters actually known, and
not constructively known, to any of the individuals listed on Schedule 13.5(b). Without
limiting the foregoing, a matter shall be deemed to be “actually known” by an individual listed on
Schedule 13.5 if such individual has received written notice of such matter.

   13.6. Waiver

     Any failure on the part of any party hereto to comply with any of its obligations, agreements
or conditions hereunder may be waived in writing by the other party to whom such compliance is
owed. No waiver of any provision of this Agreement shall be deemed, or shall constitute, a waiver
of any other provision, whether or not similar, nor shall any waiver constitute a continuing
waiver.

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   13.7. Assignment; Binding Effect; No Third-Party Beneficiaries

     Neither this Agreement nor any of the rights, interests or obligations under this Agreement
may be assigned or delegated, in whole or in part, by operation of law or otherwise by any party
hereto without the prior written consent of the other party hereto, and any such assignment without
such prior written consent shall be null and void, except that Parent may assign this contract to
its parent company without RMO’s or the Company’s consent, but in such case Parent shall provide
RMO and the Company with written notice of such assignment. Subject to the preceding sentence,
this Agreement shall be binding upon, inure to the benefit of, and be enforceable by, the parties
hereto and their respective successors and permitted assigns. No provision of this Agreement or
any agreement referenced herein shall create a third-party beneficiary relationship or otherwise
confer any benefit, entitlement or right upon any Person other than the parties to this Agreement
or such referenced agreement, as the case may be, except for Sections 11.2 and
11.3, which are intended to benefit and be enforceable by any of the Parent Indemnitees or
the RMO Indemnitees, respectively.

   13.8. Headings

     The section and other headings in this Agreement are inserted solely as a matter of
convenience and for reference, and are not a part of this Agreement. References to any “Section”
herein (such as “Section 5”) shall be construed to include a reference to all subsections
thereunder (i.e., 5.1, 5.1.1, ... 5.5, 5.6 ... etc).

   13.9. Entire Agreement

     This Agreement constitutes the entire agreement between the parties hereto with respect to the
subject matter herein and supersedes and cancels any prior agreements, representations, warranties,
or communications, whether oral or written, between the parties hereto relating to the transactions
contemplated hereby or the subject matter herein.

   13.10. Modifications

     Neither this Agreement nor any provision hereof may be modified, amended, changed, waived,
discharged or terminated orally, but only by an agreement in writing signed by the party against
whom or which the enforcement of such modification, amendment, change, waiver, discharge or
termination is sought.

   13.11. Governing Law

     This Agreement shall be governed by and construed in accordance with the laws of the State of
Ohio, without regards to the principles of conflicts of laws thereof.

   13.12. Severability

     The provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or enforceability of the other
provisions hereof. If any provision of this Agreement, or the application thereof to any Person or
any circumstance, is invalid or unenforceable, (a) a suitable and equitable provision shall be

50

 

substituted therefor in order to carry out, so far as may be valid and enforceable, the intent
and purpose of such invalid or unenforceable provision, and (b) the remainder of this Agreement and
the application of such provision to other Persons or circumstances shall not be affected by such
invalidity or unenforceability, nor shall such invalidity or unenforceability affect the validity
or enforceability of such provision, or the application thereof, in any other jurisdiction.

   13.13. Counterparts

     This Agreement may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. Execution by
facsimile signature shall be deemed to be, and shall have the same effect as, execution by original
signature.

   13.14. Exhibits and Schedules Incorporated

     All Exhibits and Schedules attached hereto are incorporated herein by reference. The section
numbers in the Schedules correspond to the section numbers in this Agreement; provided, however,
that any information disclosed in the Schedules under any section number shall be deemed to be
disclosed and incorporated in any other section of this Agreement where such disclosure is made
with such specificity, or in such a context, that it is reasonably apparent that such disclosure is
applicable to such other section numbers. Prior to the Closing Date, RMO shall supplement or amend
the Schedules with respect to any matter relating to the subject matter thereof hereafter arising
which, if existing or occurring at the date of this Agreement, would have been required to be set
forth or described in the Schedules. No supplement or amendment of any Schedule made pursuant to
this Section 13.14 shall be deemed to cure any breach of, or expand or limit the scope of,
or otherwise modify or affect any representations or warranty made in this Agreement unless the
parties agree thereto in writing unless the omitted item is an obligation, liability or other
matter which occurred or was incurred by the Company in the Ordinary Course of Business.

   13.15. Joint Preparation

     The parties have participated jointly in the negotiation and drafting of this Agreement. In
the event an ambiguity or question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by the parties and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any of the provisions of this
Agreement.

   13.16. Performance by Affiliates

     Any obligation of any party hereto owed to any other party hereto under this Agreement, which
obligation is performed, satisfied or fulfilled by an Affiliate of such party, shall be deemed to
have been performed, satisfied or fulfilled by such party.

   13.17. Consent to Jurisdiction; Waivers of Trial by Jury 

     Each party irrevocably agrees that any legal action or proceeding arising out of or relating
to this Agreement or for recognition and enforcement of any judgment in respect hereof or

51

 

thereof brought by another party hereto or its successors or assigns may be brought and
determined in the United States District Court, Northern District of Ohio and each party hereby
irrevocably submits with regard to any action or proceeding for itself and in respect to its
property, generally and unconditionally, to the nonexclusive jurisdiction of the aforesaid courts.
Each party hereto hereby irrevocably waives, and agrees not to assert, by way of motion, as a
defense, counterclaim or otherwise, in any action or proceeding with respect to this Agreement,
(a) any claim that it is not personally subject to the jurisdiction of the above-named courts for
any reason other than the failure to lawfully serve process, (b) that it or its property is exempt
or immune from jurisdiction of any such court or from any legal process commenced in such courts
(whether through service of notice, attachment prior to judgment, attachment in aid of execution of
judgment, execution of judgment or otherwise), and (c) to the fullest extent permitted by
applicable law, that (i) the suit, action or proceeding in any such court is brought in an
inconvenient forum, (ii) the venue of such suit, action or proceeding is improper and (iii) this
Agreement, or the subject matter hereof or thereof, may not be enforced in or by such courts. Each
party hereto further agrees that service of any process, summons, notice or document by U.S.
registered mail to such party’s respective address set forth in Section 13 shall be
effective service of process for any action, suit or proceeding with respect to any matters to
which it has submitted to jurisdiction in this Section 13.17. EACH PARTY HERETO
IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING RELATING TO
A DISPUTE AND FOR ANY COUNTERCLAIM WITH RESPECT THERETO.

[Signatures On The Following Page]

52

 

     IN WITNESS WHEREOF, each party hereto has caused this Agreement and Plan of Merger to be
executed on its behalf, all as of the day and year first above written.

	 	 	 
	 

	 	The Company:
	 
	 	 
	 

	 	Great Plains Land Development Company, LTD
	 
	 	 
	 

	 	/s/ Richard M. Osborne
	 

	 	 
	 

	 	Richard M. Osborne, Sole Member
	 
	 	 
	 

	 	Member:
	 
	 	 
	 

	 	/s/ Richard M. Osborne
	 

	 	 
	 

	 	Richard M. Osborne, Trustee
	 
	 	 
	 

	 	Parent:
	 
	 	 
	 

	 	ENERGY WEST, INCORPORATED
	 
	 	 
	 

	 	By: /s/ Kevin J. Degenstein
	 

	 	 
	 

	 	Kevin J. Degenstein, President

53

 

EXHIBIT A

to

Agreement and Plan of Merger

Form of RMO’s and the Company’s Closing Certificate

[TO COME]

A-1

 

EXHIBIT B

to

Agreement and Plan of Merger

Form of Parent’s Closing Certificate

[TO COME]

B-1

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