ASSET PURCHASE AGREEMENT
This Agreement is made and entered into this 28th day of February,
2005, by and
between Los Cabos Beverage a Nevada corporation ("Seller"), and
/Blaine
Wendtland. ("Buyer") The parties hereto are collectively and
individually
referred to herein as the "Parties."
RECITALS:
WHEREAS, Seller, who is in the business of marketing of
nutritional, health and
dietary supplements and products along with water, wishes to sell
to Buyer its
Assets and company stock (sometimes referred to hereinafter as
"Business");
WHEREAS, Buyer desires to acquire assets of Seller used in the
operation of the
business and Seller desires to sell, transfer and assign same to
Buyer;
WHEREAS, Blaine Wendtland ("Wendtland") and Gateway Distributors
Ltd are the
owners of Los Cabos Beverage.
NOW THEREFORE, in consideration of the mutual promises and
covenants herein
contained, the Parties, intending to be legally bound, agree as
follows:
1. Assets to be conveyed. On the Closing Date and at the
Closing Place, Seller
will sell, assign, convey, transfer and deliver to Buyer, and Buyer
will
acquire, purchase and accept all of the following (hereinafter
collectively
referred to as the "Assets"), free and clear of all debts, liens,
security
interests, mortgages, trusts, claims, liabilities and encumbrances,
except as
specifically assumed by Buyer as listed on attached Exhibit A: All
accounts
payable are the responsibility of the Buyer.
(a) All of the tangible personal property, physical assets and
equipment used or
intended to be used in the operation of the business, including but
not limited
to those assets set forth in Exhibit A attached hereto, except for
those items
of tangible personal property specifically identified as excluded
assets on
Exhibit A, together with any replacements thereof or additions
thereto made
between the date hereof and the Closing Date, less any retirements
made in the
ordinary and usual course of business in connection with the
acquisition of
similar property or assets of greater or equal value (hereinafter
referred to as
the "Personal Tangible Assets");
(b)
All right, title and interest to any and all rights, licenses,
permits,
trademark names, websites, authorizations and other intangibles, to
the extent
lawfully transferable, which are used, useful or intended to be
used in the
operation of Business listed on Exhibit A Assets.
(c)
Payables are the burden of Buyer and Seller assumes no
payables.
2. Excluded Assets, Liabilities and Contracts. Seller shall be solely
responsible for, and there shall be no assumption of liability by
Seller of, any
liabilities, obligations or commitments of Seller of any nature
whatsoever.
3. Purchase Price. It
is agreed to by all parties that the startup of Los Cabos
Beverage does not fit in with the Gateway Distributors Ltd core
business model,
therefore it is
1
<PAGE>
determined that it is in the best interest of all parties to
discontinue the
operation. The disbursements of inventory and equipment will be
given to the
Buyer who personally paid for these items.
4. Allocation. It is
agreed between the Parties hereto that there is no cash
being exchanged and no revenues received to date from sale of the
product.
Therefore, the
Seller has no obligation regarding taxes and licensing. It will
be the Buyer's responsibility going forward to report their federal
income tax.
5. Representations, Warranties and Covenants of Seller.
Seller represents,
warrants and covenants to Buyer that:
(a) Organization and Standing. February 28, 2005 is the official
closing date
and signature of this agreement which consummates the entire
agreement.
(b) Authorization.
Seller has full right, power and authority to enter into and
perform this Agreement and the transactions contemplated hereby.
All necessary
corporate action to approve the execution, delivery and performance
of this
Agreement and the consummation of the transaction contemplated
hereby has been
taken by Seller, and this Agreement constitutes a valid and binding
agreement of
Seller enforceable in accordance with its terms;
(c) Personal Property.
All of the Personal Tangible Assets are listed and
described in Exhibit A, attached hereto.
6. Litigation. No
judgment is issued or outstanding against the Business.
To
the best of Seller's knowledge as of the Closing Date there is no
litigation,
action, claim, special assessment, suit, fine, judgment, proceeding
or
investigation pending or outstanding before any arbitrator, forum,
court or
governmental body, department or agency of any kind, to which
Seller or the
Business is a party.
To the best of Seller's knowledge, no such litigation,
action, claim, special assessment, suit, fine, proceeding or
investigation is
now or on the Closing Date shall be threatened, which might result
in any
material adverse change in the business, prospects or financial
conditions of
the Business.
7. Contracts. With
respect to the Business, Seller has no existing contract,
agreement, lease, commitment or understanding, written or oral,
expressed or
implied.
8. Absence of Restrictions. The execution, delivery and
performance of this
Agreement and the transaction contemplated hereby by Seller do not
and on the
Closing Date will not:
(i) violate any material provision of law applicable to
Seller or conflict with, result in the termination or breach of any
term,
condition of provision of, or constitute a default under, the
Articles of
Incorporation or by-laws of Seller, or of any contract, lease,
agreement or
other instrument or condition to which Seller is a party or to
which the Assets
are subject, or result in the creation of any lien, charge, claim,
pledge,
security interest or encumbrance on any of the Assets; or (iii)
cause or result
in the advancement or acceleration of maturity of any liability of
the Seller or
the alteration or modification to the detriment of Buyer of the
terms,
conditions or provisions of any contract, lease agreement or other
instrument or
condition by which Seller is bound or to which any of the Assets
are subject;
9. Disclosure. Seller
has made full disclosure of all material events and facts
pertaining to the operation of the Business, of which it has
knowledge,
including but not limited to any material eve
