ASSET PURCHASE AND SALE AGREEMENT
Exhibit 10.17
This Asset Purchase and Sale Agreement (this “Agreement”) is made and entered into effective
as of August 31, 2009, by and between BCINET, INC., a Delaware corporation (“Buyer”), and OCZ
TECHNOLOGY GROUP, INC., a Delaware corporation (“Seller”).
RECITALS:
A. Seller owns and operates a business relating to video game controller, together with the
Neural Impulse Actuator (the “NIA”) product line, and related technology (the “Business”).
B. Buyer desires to purchase from Seller the Business as a going concern and to acquire
substantially all the assets relating to the Business, and Seller is willing to sell and convey
such assets to Buyer, on the terms and subject to the conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations, and
warranties contained in this Agreement, the parties hereto agree as follows:
1. Purchase and Sale.
1.1 Sale and Purchase of Assets. Subject to the terms and conditions of this
Agreement, at the Closing (as defined below), Seller shall sell, transfer, assign and convey to
Buyer, and Buyer shall purchase from Seller all of the following tangible and intangible assets,
materials, support and services used or useful primarily in the operation of the Business (the
“Assets”):
(a) Inventory. Certain inventory, including all of the NIA products currently owned
by the Seller, as described in Exhibit A attached hereto (the “Inventory”), together with
related agreements.
(b) Other Assets. Certain patents, patent applications, copyrights, trademarks,
proprietary material, trade right, trade secrets, and such other assets as described in Exhibit
B attached hereto (the “Other Assets”) as well as the services described in Exhibit B
attached hereto.
(c) Goodwill. The goodwill associated with the Business (the “Goodwill”).
2. Purchase Price. The purchase price to be paid by Buyer for the Assets shall
consist the following (the “Purchase Price”):
2.1 Secured Promissory Notes. Buyer shall issue to Seller three secured promissory
notes as follows:
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(a) A secured promissory note in the amount of $311,215.00,
representing the value of the Inventory being transferred, in the form attached hereto as
Exhibit C (“Inventory Note”). The Inventory Note will carry an interest rate of 1% per
annum, and the entire principal amount of the Inventory Note together with all accrued and unpaid
interest shall become due and payable eleven months from the date of issuance.
(b) A secured promissory note, in the form attached hereto as Exhibit D, in the amount
of $170,000.00, representing the value of the Other Assets as well as the value of services
referred to in Section 1.1(b) (“Other Assets Note”). Other Assets Note will carry an interest rate
of 1% per annum, and the entire principal amount of the Other Assets Note together with all accrued
and unpaid interest shall become due and payable two years from the date of issuance.
(c) A secured convertible promissory note in the amount of $414,200.00, representing part of
the total value of the Goodwill, in the form attached hereto as Exhibit E (“Goodwill
Note”). The Goodwill Note will carry an interest rate of 3% per annum, and the entire principal
amount of the Goodwill Note together with all accrued and unpaid interest shall become due and
payable five (5) years from the date of issuance.
(d) The Inventory Note, Other Assets Note, and Goodwill Note (collectively, the “Notes”) shall
be issued pursuant to a security agreement in the form attached hereto as Exhibit F (the
“Security Agreement”).
2.2 Stock. As consideration for part of the Goodwill, Buyer shall issue to Seller or
its assigns 2,633,333 shares of Buyer’s Series A Preferred Stock at the price of $0.31 per share,
for a total purchase price of $816,333.23, pursuant to a Series A Preferred Stock Purchase
Agreement substantially in the form attached hereto as Exhibit G (the “Stock Purchase
Agreement”).
3. Support and Service Contract. To assist Buyer with certain overhead and other
costs, Seller shall provide or make available to Buyer certain technical support and operational
and other services pursuant to a services agreement substantially in the form attached hereto as
Exhibit H.
4. Representations and Warranties of Seller. As of the date hereof, Seller represents
and warrants to Buyer as follows:
4.1 Organization and Good Standing. Seller is a corporation validly existing and in
good standing under the laws of the State of Delaware. The Company has all requisite power to own,
operate and lease its properties, to perform all of its obligations under the agreements and
instruments to which it is a party or by which it is bound, and to carry on its business as it is
now being conducted.
4.2 Authorization and Enforceability. Seller has the legal power and authority to
execute and deliver this Agreement and each of the documents contemplated hereby to which Seller is
a party, and to perform its obligations hereunder and thereunder, and the execution, delivery and
performance of this Agreement and each of the documents contemplated hereby to which Seller is a
party, have been duly and validly authorized and approved by all necessary and proper company
action on the part of Seller. This Agreement and each of the documents
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contemplated hereby to which Seller is a party, constitute legal, valid and binding
obligations of Seller and are enforceable against Seller in accordance with their respective terms.
4.3 Title to the Assets. Seller has good, valid and marketable title to the Assets,
subject to certain approval as described in Schedule 4.3 attached hereto.
4.4 Compliance With Law. The operation of the Business complies in all material
respects with the applicable rules and regulations of all federal, state, local or other laws,
statutes, ordinances, regulations, and any applicable order, writ, injunction or decree of any
court, commission, board, agency or other instrumentality.
5. Representations and Warranties of Buyer.
Buyer represents and warrants to Seller as follows:
5.1 Organization and Good Standing. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. Buyer has all requisite
corporate power to own, operate and lease its properties and carry on its business as it is now
being conducted.
5.2 Authorization and Enforceability. Buyer has the legal power and
authority to execute and deliver this Agreement and each of the documents contemplated hereby to
which Buyer is a party, and to perform its obligations hereunder and thereunder, and the execution,
delivery and performance of this Agreement and each of the documents contemplated hereby to which
Buyer is a party, have been duly and validly authorized and approved by all necessary and proper
company action on the part of Buyer. This Agreement and each of the documents contemplated hereby
to which Buyer is a party, constitute legal, valid and binding obligations of Buyer and are
enforceable against Buyer in accordance with their respective terms.
6. Closing.
6.1 Closing. The closing shall take place at the offices of Seller or at such other
place as the parties agree (the “Closing”) on August 31, 2009.
6.2 Consummation of Sale. At Closing, Seller shall sell, assign, transfer, convey and
deliver to Buyer all of its right, title and interest in and to all of the Assets, and Buyer shall
purchase from Seller the Assets for the Purchase Price.
6.3 Documents to Be Delivered to Buyer by Seller. At the Closing, Seller shall
deliver to Buyer the following:
(a) A xxxx of sale and other instruments of transfer and conveyance transferring to Buyer the
Assets.
(b) Such additional information and materials as Buyer shall have reasonably requested.
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6.4 Documents to Be Delivered to Seller by Buyer. At the Closing, Buyer shall
deliver or cause to be delivered to Seller the following:
(a) The Notes as described in Section 1.2(a).
(b) The Security Agreement as described in Section 1.2(a).
(c) The Stock Purchase Agreement as described in Section 1.2(b) and other related documents as
set forth in such Stock Purchase Agreement.
(d) Such additional information and materials as Seller shall have reasonably requested.
7. Miscellaneous.
7.1 All notices, demands or consents required or permitted to be given under this Agreement
shall be in writing and shall be effective upon delivery.
7.2 No waiver, amendment or modification of any provision hereof or of any right or remedy
hereunder shall be effective unless in writing and signed by the parties. No failure by any party
in exercising any right, power or remedy secured hereunder shall operate as a waiver of any such
right, power or remedy.
7.3 This Agreement shall be binding upon and inure to the benefit of the permitted successors
and assigns of the parties hereto.
7.4 The validity, construction and performance of this Agreement shall be governed by the
substantive laws of the State of California, as applicable to contracts entered into and performed
within the State of California. In the event that any provision of this Agreement or the
application of such provision shall be held by a court of competent jurisdiction to be contrary to
law, the remaining provisions of this Agreement shall remain in full force and effect. The parties
agree to submit to the in personal jurisdiction of the state courts of the State of California
located in Santa Xxxxx County, California and of the United States District Court for the Northern
District of California for the purpose of any suit, action or proceeding arising out of or based on
this Agreement.
7.5 This Agreement may be executed in two or more counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same instrument. A facsimile
signature page shall be deemed an original.
7.6 This Agreement shall be deemed to have been drafted by all parties and, in the event of
dispute, no party hereto shall be entitled to claim than any provision should be construed against
any other party by reason of the fact that it was drafted by one particular party.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first written.
| OCZ Technology Group, Inc. |
||||
| By: | ||||
| Xxxx X. Xxxxxxxx | ||||
| President & CEO | ||||
| BCInet, Inc. |
||||
| By: | ||||
| Xxxxxx X. Xxxxxxxx | ||||
| President & CEO | ||||
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Schedule 4.3
APPROVAL REQUIREMENT
| Silicon Valley Bank | ||
| Faunus Group International, Inc. |
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Schedule 4.3
Exhibit A
INVENTORY
Inventory includes:
1. 4,597 units of new Neural Impulse Actuator products (the “NIA Products”).
2. All component and other parts, packaging and other materials relating to NIA Products not
included in whole unit SKUs.
3. All RMA returned NIA Products.
4. All Intellectual Property relating to the design, manufacture and use of NIA Products.
5. All registered trademarks, licenses, domain names and other associated materials.
6. All other materials and documentation related to the NIA Products.
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Exhibit A
Exhibit B
OTHER ASSETS
The Other Assets include:
| 1. | The following U.S. provisional pending patents, including all of their related international patents and patent applications: |
| a. | 00000000000 for a gaming headset with integrated microphone and adapted for olfactory stimulation | ||
| b. | 20090009475 for a wireless computer mouse with battery switching capability | ||
| c. | 12/406,405 for a method and apparatus for using biosignals for simultaneous multiple control functions in computer systems |
| 2. | The following materials, services and support: |
| a. | Facilities for inventory storage and business operations; | ||
| b. | Administrative; reception; | ||
| c. | Accounting and bookkeeping; | ||
| d. | Operational support; | ||
| e. | Sales channels; | ||
| f. | Design; | ||
| g. | Engineering; | ||
| h. | Marketing; | ||
| i. | Technical support: | ||
| j. | Computers and other office equipment; and | ||
| k. | Other necessary and appropriate support. |
The provision of the services described in this Section 2 of this Exhibit B shall be set forth
in the Services Agreement as attached to this Agreement as Exhibit H.
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Exhibit B
Exhibit C
SECURED
PROMISSORY NOTE – Inventory
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Exhibit C
Exhibit D
SECURED
PROMISSORY NOTE – Other Assets
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Exhibit D
Exhibit E
SECURED CONVERTIBLE PROMISSORY NOTE – Goodwill
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Exhibit E
Exhibit F
SECURITY AGREEMENT
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Exhibit F
Exhibit G
SERIES A PREFERRED STOCK PURCHASE AGREEMENT
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Exhibit G
Exhibit H
SERVICES AGREEMENT
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Exhibit H
