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ASSET PURCHASE AGREEMENT

Asset Purchase Agreement

ASSET PURCHASE AGREEMENT | Document Parties: AMISH NATURALS, INC. | Amish Natural Sub Inc | Schlabach Amish Bakery, LLC You are currently viewing:
This Asset Purchase Agreement involves

AMISH NATURALS, INC. | Amish Natural Sub Inc | Schlabach Amish Bakery, LLC

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Title: ASSET PURCHASE AGREEMENT
Governing Law: Ohio     Date: 11/16/2007

ASSET PURCHASE AGREEMENT, Parties: amish naturals  inc. , amish natural sub inc , schlabach amish bakery  llc
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Exhibit 10.18

ASSET PURCHASE AGREEMENT

        This Asset Purchase Agreement (the “ Agreement ”) is entered into as of October 15, 2007 (the “ Effective Date ”), by and among Schlabach Amish Bakery, LLC, an Ohio Limited Liability Company (“ Seller ”), and Vickie Moser, (“ Seller’s Owner ” and, the “ Seller Parties ”), and Amish Natural Sub Inc., an Ohio corporation (“ Buyer ”), which is a wholly-owned subsidiary of Amish Naturals, Inc., a Nevada corporation (“ ANI ”). Buyer and the Seller Parties shall hereinafter individually be referred to as a “ Party ” and collectively be referred to as the “ Parties .”

RECITALS

        WHEREAS, Seller is engaged in the business of manufacturing, sale and distribution of bakery goods and other products in Millersburg, Ohio (the “ Business ”); and

        WHEREAS, Buyer desires to purchase from Seller, and the Seller Parties desire that the Seller sell and transfer to Buyer, certain assets of Seller on the terms and subject to the conditions of this Agreement.

        NOW, THEREFORE, in consideration of the premises, and the representations, warranties, covenants, and agreements contained in the Transaction Documents (as hereinafter defined), and for such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto hereby agree as follows:

ARTICLE 1
PURCHASE AND SALE OF ASSETS

        1.      Purchase and Sale of Assets

              1.1     Purchase and Sale . Subject to the terms and conditions of this Agreement, on the Closing Date (as defined in Section  4.1 herein), Seller hereby agrees to sell, assign, transfer, and deliver to Buyer, and Buyer agrees to purchase, accept, and acquire from Seller, all of Seller’s right, title, and interest in and to the “Purchased Assets ”as follows:

                  (a)     Any and all assets and inventory of Seller relating to the Business, including, without limitation, that certain inventory set forth on Schedule 1.1(a) attached hereto (the “ Assets and Inventory ”). Schedule 1.1(a) shall include, but shall not be limited to, the name, location, description and identification number (to the extent available) of all the Assets and Inventory;

                  (b)     Any and all intellectual property of Seller relating to the Business, including without limitation that certain intellectual property set forth on Schedule 1.1(b) attached hereto (the “ IP ”). Schedule 1.1(b) shall include, without limitation, Seller’s tradename and website domain name, as used in the Business;


                 (c)     The real estate lease agreement set forth on Schedule 1.1(c) attached hereto (the “ Lease Agreement ”) and all improvements and fixtures which shall terminate upon Closing;

                 (d)     All customer lists, vendor lists, and other compilations of data used in or related to the Business;

                 (e)     Those books and records of Seller directly related to the Purchased Assets, including invoices, purchase orders, vendor and customer correspondence (if any);

                 (f)     To the extent transferable, all franchises, approvals, permits, licenses, registrations, certificates, and similar rights obtained from governmental bodies; and

                 (g)     All goodwill and other intangible assets associated with the Purchased Assets.

        1.2      Excluded Assets . Notwithstanding any term herein to the contrary, Seller is not agreeing to, and, accordingly, shall not, sell, assign, transfer, or deliver to Buyer, and Buyer is not agreeing to, and, accordingly, shall not, purchase, accept, or acquire from Seller, any of Seller’s assets other than those assets specifically set forth in Section 1.1 herein.

        1.3      Free and Clear of All Liens and Liabilities . The Purchased Assets shall be free and clear of all liens, liabilities, claims, and encumbrances, except as referred to in Section 1.1(c).

        1.4      Delivery of Purchased Assets . As of the Closing, Buyer shall take physical possession of the Purchased Assets at Seller’s warehouse facilities located in Millersburg, Ohio.

ARTICLE 2
PURCHASE PRICE

2. Purchase Price .

(a) Purchase Price . The purchase price for the Purchased Assets (the “ Purchase Price ”) shall be Two Hundred Fifty Thousand Dollars ($250,000) payable to Seller at Closing by wire transfer or delivery of certified funds for such amount.

                 2.2      Purchase Price Allocation . The Purchase Price shall be allocated among the Purchased Assets as set forth on Schedule 2.2 attached hereto. Seller and Buyer agree that the allocation will bind them for federal, state, local, and foreign income tax purposes in connection with the purchase and sale of the Purchased Assets and will be consistently reflected by them on any tax returns or reports they file or prepare. Seller and Buyer shall consult with each other concerning all issues relating to such allocation in connection with any tax audit and shall not initiate any positions inconsistent with such allocation in connection with any tax audit.


ARTICLE 3
ASSUMPTION OF SPECIFIED LIABILITIES

3.     Assumption of Specified Liabilities .

        3.1      No Assumption of Liabilities Unless Expressly Assumed . Unless as specifically provided in Section 3.2 below, Buyer does not assume and shall not have any duty or obligation with respect to any liability, duty, contract, agreement, or obligation of Seller or Seller’s Owners, whether by the terms of this Agreement, by operation of law, or otherwise, whether or not associated with the Business or any of the Purchased Assets.

        3.2      Specification of Liabilities Assumed . Seller hereby agrees that Buyer has the right, but not the obligation, to assume, satisfy, and perform when due all liabilities, duties, contracts, agreements, and obligations of Seller arising or accruing from and after the Closing Date directly and solely related to the Lease Agreement and any purchase orders that had been received by the Seller prior to the Closing Date, which related to the purchase of products from the Business, if such purchase orders had not been fulfilled, in whole or in part, as of the Closing Date (collectively, the “ Assumed Liabilities ”). Buyer shall have no obligation to tender to Seller any economic benefit received by Seller in respect of fulfilling any such purchase orders.

ARTICLE 4
CLOSING DATE

4.     Closing Date .

        4.1      Closing Date . Provided that all conditions precedent set forth in this Agreement have been satisfied or waived, the closing of the transactions contemplated hereby (the “ Closing ”) shall occur on October 15, 2007, or such other date as shall be mutually agreed upon by the Parties hereto (the “ Closing Date ”). The Closing shall be held on the Closing Date at 10:00 a.m. EST at the offices of ANI, unless another place and time is mutually agreed upon by the Parties.

        4.2      Date of Transfer . Provided that the Closing occurs, it is the intent of the Parties that the Purchased Assets be transferred to Buyer effective as of the Closing Date. Further, the Assumed Liabilities shall be transferred to and assumed by Buyer effective as of the Closing Date.

ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF SELLER PARTIES

5.      Representations and Warranties of Seller Parties . As a material inducement to Buyer to enter into this Agreement, the Seller Parties, jointly and severally, make the following representations and warranties to Buyer, each of which the Seller Parties, jointly and severally, represent to be true and correct. The schedules delivered pursuant to this Article 5 (the “ Disclosure Schedules ”) shall be arranged in paragraphs corresponding to the numbered and lettered paragraphs contained in this Article 5, and the disclosure in any paragraph shall qualify other paragraphs in this Article 5 only to the extent that it is reasonably apparent from a reading of such disclosure through appropriate cross-referencing that it also qualifies or applies to such other paragraphs.

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        5.1      Organization and Qualification . Seller is a Limited Liability Company duly organized, validly existing, and in good standing under the laws of the State of Ohio, with all necessary corporate power and authority to own or use its property that it now owns or uses and to carry on its business as it is now being conducted. Seller is duly qualified to do business and is in good standing in each jurisdiction where the ownership, lease, or operation of its property or the conduct of its business requires such qualification, except where the failure to be in good standing or so qualified would not have a material adverse effect on Seller or the Business. At the date hereof, Seller has one Member Interest (the “ Seller Member Interest ”) validly issued and outstanding. The Seller Member Interest is fully paid, non-assessable, and is entirely owned of record and beneficially by Seller’s Owner, who has not granted any options in the Seller Member Interest to any person. There are no options, warrants, or other securities exercisable or convertible into, or any calls, commitments, agreements, or obligations of any kind relating to, any unissued equity securities of Seller.

        5.2      Authorization and Validity . Each of the Seller Parties has the requisite power and is duly authorized to execute and deliver and to carry out the terms of this Agreement and to execute, deliver and perform its respective obligations under the documents required at the Closing pursuant to Article 10 (the “ Closing Documents”) and any other documents this Agreement contemplates. All action required, by law and/or Seller’s Articles of Organization and Bylaws or otherwise, to authorize the execution and delivery of this Agreement, the Closing Documents and the consummation of the transactions contemplated hereby has been taken. This Agreement, the Closing Documents and all other documents contemplated by this Agreement are, or will be upon execution, legal, valid and binding obligations of the Seller Parties, duly enforceable against the Seller Parties according to their terms, except as may be limited by (i) bankruptcy, insolvency, moratorium, or other similar laws affecting creditors’ rights generally, and (ii) general principles of equity relating to the availability of equitable remedies.

        5.3      Consents and Approvals . Except for that stated on Schedule 5.3 , no consent, approval, notification or authorization is required in connection with the execution, delivery, and performance of this Agreement or any Closing Document by the Seller Parties or the consummation of any transactions contemplated hereby, including but not limited to any “bulk sale”notice or similar filing, publication or notice by any Party under the laws of the State of Ohio in connection with the transactions contemplated hereby.

        5.4      No Defaults . Seller is not in default under or in violation of (i) any provision of its Certificate of Incorporation or Bylaws; (ii) any material provision of any indenture, mortgage, deed of trust, lease, loan agreement, or other agreement or instrument to which it is a party or by which it is bound or to which any of Seller’s property is subject (including without limitation the Contracts, as that term is defined hereinafter), if such default would have a material adverse effect on Seller, the Business, or the Purchased Assets; or (iii) any statute, law, ordinance, order, judgment, rule, regulation, permit, franchise, or other approval or authorization of any court or governmental agency or body having jurisdiction over it or any of Seller’s properties which, if enforced, would have a material adverse effect on Seller, the Business, or the Purchased Assets. The execution and delivery of this Agreement, the Closing Documents and any other documents contemplated hereunder or thereunder; the Seller Parties’ performance of their respective obligations under this Agreement, the Closing Documents and other documents; or the consummation of the transactions contemplated herein will not conflict with, result in a breach of or, constitute a default under any of the foregoing, require the payment of any prepayment or other penalties, or result in the creation of any lien, mortgage, pledge, charge, or encumbrance upon any asset of Seller. Furthermore, no consents or waivers thereunder are required to be obtained or notices be given in connection therewith in order to execute and deliver this Agreement, the Closing Documents and/or any other documents contemplated hereunder or thereunder or to consummate the transactions contemplated by this Agreement.

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        5.5      Documents . The copies and/or originals of all agreements, books and records related to the Purchased Assets, and other instruments (including any financial statements relating to the Business provided to Buyer prior to Closing) that have been delivered by the Seller Parties to Buyer are true, correct, and complete copies and/or originals of such agreements, books, records, and instruments, and include all amendments thereto.

        5.6      Litigation . There are no actions, suits, proceedings, orders, investigations, or claims (collectively, “Proceedings ”) pending or threatened against or affecting Seller, the Business or the Purchased Assets, or that may interfere with the timely consummation of the transactions contemplated by this Agreement, at law or in equity, or before or by any governmental department, commission, board, bureau, agency, or instrumentality. Seller is not operating under or subject to, or in default with respect to, any order, writ, injunction, or decree of any court or federal, state, municipal, or other governmental department, commission, board, agency, or instrumentality. Neither of the Seller Parties has any Knowledge (defined below) of the basis for any such action, suit, proceeding, order, investigation, or claim. “ Knowledge ” is defined to include actual knowledge and what a reasonably prudent person would discover upon due inquiry and investigation.

        5.7      Products . During its existence, Seller has not had (a) any notification, in writing or otherwise, relating to or (b) any claims, demands, causes of action (including third-party claims, demands, and causes of action, whether directly or for contribution or indemnification), losses, damages, expenses (including attorney’s fees), and/or liabilities of any kind and nature asserted by any person that arises out of or results from any one or more of the following, with respect to products sold by the Seller in relation to the Business: (i) any breach by any manufacturer of any of its representations, warranties, or covenants; (ii) without limiting the preceding, any defective product; (iii) any recall of any product, regardless of who initiated the product recall; and/or (iv) any negligent act or omission by a manufacturer. In addition, the Seller has not issued or been required to issue any notification, in writing or otherwise, to any person about the quality, manner of consumption, or spoilage of any products sold by the Seller in relation to the Business, or for any other reason. Furthermore, there has been no, or any notice received of, death, personal injury, or loss of property to unrelated third parties, whether during any warranty period or after its expiration, in connection with any products of the Business.

        5.8      Inventory . Except for obsolete items and items below standard quality, all of which will have been written off or written down to net realizable value, all Inventory will (a) consist of inventory manufactured or acquired in bona fide transactions in the ordinary course of business; (b) be of a quality and quantity usable and salable in the ordinary course of business; and (c) not exceed the shelf life that would adversely affect the qualitative performance characteristics or the quality of the ingredients. All inventories not written off will be reflected in the appropriate documents at the lower of average cost or market on a [last-in, first-out basis] . The quantities of each item of Inventory (whether raw materials, work-in-process or finished goods) will not be excessive, but will be reasonable in the circumstances of the Business.

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        5.9      Title to Properties . Seller is the sole owner of and has good, complete, and marketable title to, and full rights to utilize, the Purchased Assets, free and clear of liens, claims, and encumbrances. At the Closing, Seller will convey and transfer to Buyer good, complete, and marketable title to all of the Purchased Assets, free and clear of restrictions or conditions to transfer or assignment, and free and clear of all liens, claims, and encumbrances.

        5.10      Real Property . Schedule 5.10 sets forth a description of all real property and real property interests currently owned, leased or otherwise held by Seller (“ Real Property ”). Schedule 5.10 also sets forth a list of all leases of real property to which Seller is a signatory or by which it is bound or affected (collectively, the “ Real Property Leases ”). Seller owns valid and binding leasehold interests in the Real Property Leases. The Real Property Leases are in full force and effect and have not been terminated. No event has occurred and no condition exists which, with the giving of notice or the lapse of time or both, will constitute a default under any of the Real Property Leases. Seller has not sublet or assigned any portion of the Real Property. To Seller Parties’ Knowledge, none of the Real Property is the subject of any condemnation action and, to Seller Parties’ Knowledge, there is no proposal under consideration by any governmental body to take or use any of the Real Property. To Seller Parties’ Knowledge, the Real Property has direct access on a public way with sufficient road frontage to satisfy all necessary Laws.

        5.11      Condition and Sufficiency of Assets . To Seller Parties’ Knowledge, the buildings, plants, structures, furniture, fixtures and/or equipment owned or used by Seller and included in the Purchased Assets: (a) are structurally sound, are in good operating condition and repair, are adequately serviced by all required utilities and are adequate for the uses to which they are being put; (b) do not need maintenance or repairs except for ordinary, routine maintenance and repairs; and (c) are sufficient for the continued conduct of the Business as it is currently being conducted.

        5.12      Compliance with Laws . Seller has complied with and is not in violation of any federal, state, county, or local statute, law, rule, regulation, ordinance, guidance, code, license, use, permit, franchise, judgment, decree, writ, injunction, and/or order (collectively, “ Laws ”) applicable to the Purchased Assets. Neither of the Seller Parties has received any notice alleging non-compliance with any Law. There are no present or past conditions relating to the Purchased Assets arising from or related to any past or present storage, spill, discharge, leak, emission, injection, escape, dumping, or release of any kind whatsoever of any hazardous material or any generation, transportation, treatment, storage, or disposal of waste materials, raw material, or other products of any kind or from the storage, use, or handling of any hazardous material or other substances. Seller has no reason to anticipate that any existing circumstances are likely to result in a violation of any Laws.

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        5.13      Permits and Licenses . To Seller Parties’ Knowledge, all governmental authorizations necessary to carry on the Business as presently conducted are set forth in Schedule 5.13 and have been timely obtained, are in full force and effect and have been complied with. All fees and charges incident to those governmental authorizations have been fully paid and are current, and no suspension or cancellation of any governmental authorization has been threatened or to Seller Parties’ Knowledge could result by reason of the transactions contemplated by this Agreement.

        5.14      Liabilities . Seller has no liabilities or obligations, including without limitation any debt, accounts payable, indebtedness, commitment, unpaid tax liability or other obligation of any nature, incurred in connection with the Purchased Assets (whether known or unknown and whether absolute, accrued, contingent, unasserted, secured, unsecured or otherwise), except those set forth in Schedule 5.14 . Schedule 5.14 also sets forth any liabilities and/or obligations of Seller that are being assumed by Buyer at Closing.

        5.15      No Other Agreements to Sell the Assets . Neither the Seller Parties nor any of Seller’s officers or affiliates has any commitment or legal obligation, absolute or contingent, to any other person or entity other than Buyer to sell, assign, transfer, or effect a sale of any of the Purchased Assets, to sell or effect a sale of any of the capital stock of Seller, to effect any merger, consolidation, liquidation, dissolution, or other reorganization of Seller, or to enter into any agreement or cause the entering into of an agreement with respect to any of the foregoing.

        5.16      Taxes . All tax returns or statements required to be filed with respect to the operations or assets of Seller prior to the Closing Date have been correctly prepared in all material respects and timely filed, and all taxes, and penalties and interest, if any, required to be paid in respect of the periods covered by such returns have been paid in full or adequate reserves have been established for the payment of such taxes. All known deficiencies of any tax, assessment, or government charge or duty have been paid in full or adequate reserves have been established for the payment of such taxes. No audits or investigations by federal or state authorities are currently pending or threatened. Furthermore, Seller has complied in all material respects with all applicable Laws relating to the payment and withholding of taxes and has, within the time and the manner prescribed by such Laws, withheld and paid over to the proper governmental authorities all amounts required to be so withheld and paid over under the applicable Laws.

        5.17      Intellectual Property . To Seller Parties’ Knowledge, Seller owns or has the right to use, pursuant to license, sublicense, agreement or permission, all intellectual property. The use of IP has not infringed any intellectual property of any other person and, to Seller Parties’Knowledge, there is no infringement of or unlawful use by any other person of any of the IP. Schedule 5.17 also sets forth a list of all contracts relating to IP to which Seller or any affiliate is a party or by which Seller or any affiliate is bound or affected to any material extent, excluding: (i) license agreements for “off the shelf” computer software and other commercially available products and (ii) any licenses implied by the sale of a product. None of the IP owned or used by Seller is subject to any pending, or threatened, Proceedings, and there is no valid basis for asserting any such Proceeding. No IP owned or used by Seller is subject to any outstanding order restricting the use by Seller (or Buyer following the Closing) of that IP. The IP included among the Purchased Assets is all that is necessary for the operation of the Business as presently conducted.

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        5.18      Subsidiaries . (a) Seller has no subsidiaries; (b) Seller does not own, beneficially, of record or otherwise, any securities of any entity; (c) Seller is not a party or subject to any partnership, joint venture, or similar agreement or arrangement; and (d) except shares of common stock of ANI owned of record or beneficially by Seller’s Owners (or Seller’s Owners’ spouses), no Seller Party owns, directly or indirectly, any security or financial interest in any other entity or concern which competes with or does business with Seller or which would interfere with the performance of any duties it/they owe to Seller.

        5.19      Employees, Labor Relations.

                 (a)     Schedule 5.19 contains, as of a recent date specified therein, the following information for each employee of Seller (including each employee on leave of absence or layoff status): name; job title; hire date; current compensation paid or payable; vacation accrued; eligibility to participate under any Employee Benefit Plan; and citizenship. Seller Parties have no Knowledge that any employee intends either to (i) discontinue employment with Seller either prior or subsequent to the Closing or (ii) refuse employment by Buyer (taking into account the employment arrangements and policies to be implemented after the Closing).

                 (b)     Neither Seller, nor any affiliate of Seller, is now or has ever been a party to any collective bargaining or other labor contract. In the last five (5) years there has not been, there is not presently pending or existing, and to Seller Parties’ Knowledge there is not threatened, with respect to Seller or any of its premises: (i) any strike, slowdown, picketing, work stoppage, lockout, organizational activity or other labor dispute or Proceeding; (ii) any application or complaint filed by any employee or union with any governmental body; or (iii) any application or demand for recognition or certification of a collective bargaining agent. To Seller Parties’ Knowledge, there is not currently, nor has there been in the past five years, any internal investigation of any charge or complaint by any employee of Seller alleging harassment, discrimination or other employment conduct which could give rise to liability. To Seller Parties’ Knowledge, all Laws relating to Seller’s employees, including Laws relating to terms of employment, immigration and employment of illegal aliens, the payment of social se


 
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