Pretty strange that MTVX traded about 450 mil today of all days. Day that APT needed to pay 150k or be in default of MOTOPED deal. If not for the paint job of 136 bucks worth of shares this would still be at .0002. Also find it strange a lot of new faces here painting blue skies and rainbows. Hmmm I wonder why???
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Purchase Price. Buyer shall pay to Sellers the following as purchase price for the Assets:
(a)
$50,000 payment to Cameron Woods upon execution of the Asset Purchase Agreement;
(b)
$150,000 payment to Sellers on October 31, 2014, specifically apportioned as follows:
(i)
$30,0000 payable to Charles Carothers;
(ii)
$60,000 payable to International Motorsport Marketing Services, LLC; and
(iii)
$60,000 payable to Cameron Woods.
(c)
Earn-Outs. Buyer shall make periodic payments to Sellers based on Buyers’ revenue stream from sales of Products for the remainder of 2014, as follows:
(i)
Buyer shall pay to Sellers 200% of the gross revenue derived from sales of Products, commencing from November 1, 2013 through and including September 15, 2014, subject to the payment schedule under subsections (iii) and (iv) below;
(ii)
Buyer shall pay Sellers 100% of the gross revenue derived from sales of Products between September 16, 2014 and December 31, 2014, subject to the payment schedule under subsections (iii) and (iv) below;
(iii)
For the first $1,000,000 in gross revenue derived from sales of Products, Buyer shall pay to Sellers, on a quarterly basis, 25% of the gross profit from sales of each and every Product;
(iv)
For the second $1,000,000 in gross revenue derived from sales of Products, Buyer shall pay to Sellers, on a quarterly basis, 20% of the gross profit from sales of each and every Product, until the total payment to Sellers reach the combined gross revenue amount in subsections (i) and (ii) hereinabove; and
(v)
For all payments to Sellers under section 4(c) herein, the payments shall be split between the Sellers as follows:
(1)
20% of the payment to Charles Carothers;
(2)
40% of the payment to International Motorsport Marketing Services, LLC; and
(3)
40% of the payment to Cameron Woods.
5.
Off Sets on Deposit Liabilities. In the event any of the 162 delivered units or 329 pre-ordered units of complete Motopeds are returned after delivery or canceled prior to delivery, Buyer’s payment to Sellers under section 4(c) of this Asset Purchase Agreement for earn-outs shall be off set by the value of the return or cancellation plus 10% of that value, as a carrying charge.
2
6.
Royalty Payments. Subject to Sellers’ assignment and conveyance of all rights, ownership, and interest in the Intellectual Properties to Buyer and in addition to the Purchase Price set forth in section 4 above, Buyer shall pay for use of the Intellectual Properties as follows:
(a)
Patent Royalty. 5% of the cost incurred or paid by Sellers for the Jackshaft/Crank shown in Schedule A, Bill of Materials, accruing from execution of the Asset Purchase Agreement for a period of two (2) years.
(b)
Design Royalty. 3% of the cost of all parts, components, products, or kits based on the current Motoped design, exclusive of any parts, components for the engine, as further defined by the Bill of Materials, accruing from execution from execution of the Asset Purchase Agreement for a period of two (2) years or until the design for the frame of Motoped changes more than 20% cosmetically, whichever occurs first.
(c)
All payments for royalty under section 5 of this Purchase Agreement shall be made on a quarterly basis and be split equally between International Motorsport Marketing Services, LLC and Cameron Woods.
7.
Equity Participation. Buyer shall grant to Sellers equity interest in MotoVox as follows:
(a)
For every $200 of gross revenue derived from sales of Products in 2014 and 2015, Buyer shall issue to Charles Carothers one (1) preferred non-voting share of MotoVox;
(b)
For every $200 of gross revenue derived from sales of Products in 2014 and 2015, Buyer shall issue to International Motorsport Marketing Services, LLC one (1) preferred non-voting share of MotoVox;
(c)
For every $200 of gross revenue derived from sales of Products in 2014 and 2015, Buyer shall issue to Cameron Woods one (1) preferred non-voting share of MotoVox;
(d)
Each preferred share is convertible into 500 common shares and may not be converted within 18 months from issuance of the share; and
(e)
All qualified or earned shares shall vest and be issued on a quarterly basis based on gross revenue from that quarter, except for shares derived from sales of Products, commencing from November 1, 2013 through and including September 15, 2014, which shares shall be issued by October 15, 2014.
8.
Service Agreement. Buyer and Sellers shall enter into separate agreements with each of the individual Sellers for services related to development and/or marketing of Products, which agreements shall contain the following principal terms and conditions:
(a)
Charles Carothers: A 12-month independent sales and marketing contractor agreement at $70,000 annually with potential bonuses. The first 6 months of the agreement shall not be subject to a dismissal of any kind or for any reason with the exception of gross negligence or intentional harm to Buyer. The agreement shall contain a one year contractor renewal. Carothers agrees to give his best efforts as a private contractor for Buyer.
(b)
International Motorsport Marketing Services, LLC: A 12-month independent marketing contractor agreement at $120,000 for the 12-month term paid in monthly installments. The first six months of the agreement shall not be subject to a dismissal of any kind or for any reason with the exception of gross negligence or intentional harm to Buyer. The agreement shall contain a one year contractor renewal. The Member of the LLC shall give his best efforts as a private contractor for Buyer.
(c)
Cameron Woods: A 2-year independent product development contractor agreement at $50,000 annual salary for the first year and $60,000 for the second year. The first six months of the agreement shall not be subject to a dismissal of any kind or for any reason with the exception of gross negligence or intentional harm to the Buyer. Woods agrees to give his best efforts as a private contractor for Buyer.
