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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
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FORM 8-K
CURRENT REPORT
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PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
January 4, 1999
DATE OF REPORT (Date of earliest event reported)
BRASS EAGLE INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-23385 71-0578572
(State or other (Commission (IRS Employer
jurisidiction of File Number) Identification Number)
incorporation of
organization)
1203 A North Sixth Street, Rogers, Arkansas 72756
(Address of principal executive offices) (zip code)
(501) 986-9090
(Registrant's telephone number, including area code)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On January 4, 1999 Brass Eagle Inc. (the Registrant) acquired certain assets of
CM Support, Inc. of Dallas, Texas for $5 million in cash. The terms of this
transaction are described more fully in a press release issued January 6, 1999,
a copy of which is included as an exhibit hereto and incorporated herein by
reference. The acquisition will be accounted for as a purchase. Accordingly,
Brass Eagle Inc. expects to allocate the purchase price to the assets acquired
based on their relative fair value.
CM Support, Inc. manufactured feeder loaders, tubes and accessories used by
paintball players and was a vendor of some of these products to the Company.
Brass Eagle plans to transfer the manufacturing and distribution of the CM
Support products to its existing production facilities.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
2 Acquisition Agreement
99 Press Release dated January 6, 1999,issued by Registrant
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BRASS EAGLE INC.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BRASS EAGLE INC.
Date: 1/04/99 BY: /s/ J. R. Brian Hanna
J. R. Brian Hanna
Vice President _ Finance and Chief Financial
Officer and Treasurer
(on behalf of the Registrant and as the
Registrant's principal Financial and Accounting
Officer)
<PAGE>
BRASS EAGLE INC.
EXHIBIT INDEX
EXHIBIT NO. EXHIBIT
- ----------- -------
2 Acquisition Agreement
99 Press Release dated January 6, 1999,issued by
Registrant
<PAGE>
EXHIBIT 2
BRASS EAGLE INC.
ASSET ACQUISITION AGREEMENT
Asset Acquisition Agreement (`Agreement'), dated as of January 4, 1999, by and
between BRASS EAGLE INC. (`Buyer'), 1203A North Sixth Street, Rogers, AR 72756
and CM SUPPORT, INC., Rod Bell, David Bell and Lamar Lopez (hereinafter
collectively `Seller'), 4921 Olson Drive, Dallas, Texas 75227.
WHEREAS, the respective Boards of Directors of Buyer and Seller have approved
the sale of certain assets by Seller to Buyer;
WHEREAS, the respective Boards of Directors have each determined that this
Agreement and the underlying transaction are in the best interest of their
respective companies;
NOW, THEREFORE, in consideration of the representations, warranties, covenants
and agreement contained in this Agreement, the parties agree as follows:
ARTICLE I
1.1 Subject to the conditions to closing described herein, Seller agrees to
sell and Buyer agrees to buy all the assets of Seller including but not
limited to those assets listed on Exhibit A, but excepting the patent on
the Viewless Mounting System, all financial and business records of CM
Support, Inc. and accounts receivable (the `Assets').
1.2
(a) Buyer agrees to buy only the Assets and is acquiring no liabilities
of Seller. Seller agrees to indemnify Buyer from all liabilities of
Seller, and Seller specifically indemnifies Buyer from any
liabilities that may be imposed upon Buyer as a matter of law,
relating to this transaction.
(b) It is understood that Buyer is not obligated to hire any employees of
Seller, and Seller agrees to continue to be responsible for all
liabilities relating to employees, including but not limited to
pensions, benefits and severance pay (if any).
(c) Seller specifically indemnifies Buyer from any environmental
liabilities relating to the Assets or their use, to the extent
created or incurred prior to the date of closing.
1.3 The parties shall use their best efforts to close this transaction on or
before January 4, 1999.
1.4 At the closing, Seller shall deliver all the Assets, free and clear of any
liens, along with all paperwork necessary to evidence good title to the
Assets; including a general Bill of Sale in a form acceptable to Buyer and
specific assignment documents where appropriate.
<PAGE>
BRASS EAGLE INC.
ASSET ACQUISITION AGREEMENT (Continued)
1.5 At the closing, Buyer shall deliver by wire transfer to Seller's bank
$5,000,000, in full consideration for the Assets.
ARTICLE II
2.1 Seller, to the best of Seller's knowledge, makes the following
representations and warranties, which are true and correct at the date of
execution of the Agreement and are warranted to also be true and correct
at the date of closing:
(a) Seller is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is organized.
(b) Seller has all the requisite corporate power and authority to enter
into this Agreement, and entering into this Agreement will not
violate any loan agreement or other agreement or contract of Seller.
Seller certifies that the Board of Directors and shareholders of
Seller have approved this Agreement, pursuant to applicable laws.
(c) Seller is current on all reports, filings and permits, and is not in
violation of any laws or regulations, insofar as such violations
would impair the value of the Assets to Buyer.
(d) Seller certifies that the sale of goods in the ordinary course of
business, as Seller has been conducting and as reflected in sales on
Seller's income statement, does not violate any laws, rules or
regulations of any state or the Federal government.
(e) Seller is in compliance with all laws to the extent they would have a
material, adverse effect on the business or the value of the Assets,
in the hands of Buyer.
(f) The balance sheets and income statements presented to Buyer are true
and correct, and accurately reflect the financial condition of
Seller.
(g) Seller has paid all taxes, to the extent such taxes could constitute
a lien on the Assets in the hands of Buyer.
(h) Seller certifies there are no environmental liabilities relating to
the Assets and will hold Buyer harmless for any such liabilities to
the extent they are caused, created or originate prior to the date of
closing.
(i) Seller shall comply with any Bulk Sales Laws of the state of Texas,
to the extent applicable, and will hold Buyer harmless for any
liabilities related thereto.
(j) Seller has valid ownership and good title to the trademarks, licenses
and patents described on Exhibit A hereto. Seller will cooperate
with Buyer regarding all pending patents, patent applications and
patents under contract.
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BRASS EAGLE INC.
ASSET ACQUISITION AGREEMENT (Continued)
(k) Seller will provide Buyer with documentation allowing release of all
tooling from vendors to Buyer on or before the closing.
(l) Seller's employees are all non-union, and said employees are not
participants in any multi-employer pension plans.
ARTICLE III
3.1 The conditions to Seller's obligation to proceed with closing are as
follows:
(a) Receipt of funds as indicated in Section 1.5 of this Agreement.
3.2 The conditions to Buyer's obligation to proceed with closing are as
follows:
(a) All of Seller's representations and warranties in Article II are true
and correct to the best of Seller's and Buyer's knowledge, and Seller
has fulfilled all obligations thereunder as of the date of this
Agreement and as of the date of closing.
(b) Buyer shall have received an opinion of counsel for Seller as
outlined hereinafter.
(c) Seller shall fulfill its delivery obligations pursuant to Section 1.4
of this Agreement.
(d) Seller shall have delivered Confidentiality Noncompetition Agreements
covering Seller, Rod Bell, David Bell and Lamar Lopez, and a Retainer
Agreement covering David Bell.
(e) Seller shall have fulfilled all other obligations reasonably
requested by Buyer.
3.3 Seller shall have the following post-closing obligations:
(a) Rod Bell personally agrees to be available to Buyer for consulting
purposes as needed for the first ten weeks not to exceed two hours
per week after closing, on various matters, including but not limited
to manufacturing processes, vendor relations, sales/marketing/
distribution issues, and such other matters as may occur in
transition.
(b) David Bell personally agrees to be available to Buyer pursuant to the
Agreement marked herein as Exhibit B.
3.4 Seller's opinion of counsel shall cover: Seller's obligations under
Section 1.4 of this Agreement, and Seller's representation and warranties
under Article II hereof, and shall be in substantially the form attached
hereto as Exhibit C.
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BRASS EAGLE INC.
ASSET ACQUISITION AGREEMENT (Continued)
ARTICLE IV
4.1 LEASES AND LICENSES:
(a) Buyer agrees to assume effective January 4, 1999, all payments
and all obligations and indemnify and hold harmless Seller from that
certain capital lease for a NW 16 Mill Tronics Machine attached
hereto as Exhibit E.
(b) Subject to approval by Licensor, Seller agrees to assign all
rights and Buyer agrees to assume effective January 4, 1999, all
obligations of Seller and indemnify and hold harmless Seller from
that certain License Agreement dated June 29, 1998, by and between
RockSolid Design and Seller, which is attached as Exhibit F. Seller
warrants that all license payments have been made on a timely basis.
4.2 The parties agree that should Seller fail to comply with all conditions to
closing, at Buyer's option, Buyer may nevertheless proceed to closing and
subsequently seek monetary damages for any shortcomings on Seller's part.
4.3 The parties agree that Seller is responsible for all warranties for goods
manufactured up to the date of closing, and Buyer shall be responsible for
all warranties for goods manufactured after the date of closing. If Buyer
receives goods back under warranty claim that are Seller's responsibility,
Buyer shall give Seller the option to repair. If Seller does not wish to
repair, Buyer shall repair and invoice Seller. If Seller does not repair
within two (2) weeks after receipt of notice, Buyer may repair and invoice
the Seller.
4.4 In consideration for the funds received hereunder, Seller, Rod Bell, David
Bell and Lamar Lopez and their directors, officers, employees, spouses and
assigns agree to be barred by non-compete agreements as indicated in
Exhibit D.
4.5 The parties reiterate that this is an asset sale and that Seller retains
all liabilities of every nature and kind relating to Seller's business or
its Assets, except as otherwise specified herein
4.6 Regarding Assets:
(a) As to inventory included in Assets, the parties agree that these are
goods acquired with a view to resale by Buyer.
(b) As to other tangible Assets, the parties assert that this is a
`casual and occasional sale' under Texas law, and as such is not
subject to sales tax.
4.7 Buyer agrees to reimburse Seller for $3,500 per month for the time period
that Buyer will occupy Seller's main facility in Mesquite, Texas. The
parties anticipate this will run through February 28, 1999, but this is
only an estimate.
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BRASS EAGLE INC.
ASSET ACQUISITION AGREEMENT (Continued)
4.8 This Agreement can only be amended or terminated by a written instrument
executed by both parties; provided, however, either party may terminate by
written notice to the other, effective immediately, if the conditions to
close listed herein are not fulfilled.
4.9 Seller understands that Buyer may require audited financial statements due
to SEC requirements. In this case, Buyer shall arrange for the audit and
the cost of the audit will be paid for by Buyer.
4.10 Seller and Buyer both agree and acknowledge that effective as of date of
closing, Buyer shall be solely responsible for and shall indemnify and
hold Seller harmless from any and all claims, demands, suits, and
judgments arising out of the Assets purchased from Seller (except for
those relating to events occurring before the closing), the continued
operation and use of the lease space referred to in sub-paragraph 4.7
above, and the use by Buyer of any employees of Seller for as long as
Buyer uses and occupies such lease space and Seller's employees. In this
connection, Buyer agrees to pay in advance to Seller all wages, health
insurance, and taxes for such employees in two (2) week intervals until
Buyer ceases operation at said location.
ARTICLE V
5.1 This constitutes the entire Agreement between the parties, along with
written financial statements from Seller.
5.2 Neither party may assign this Agreement without the written consent of the
other party.
5.3 This Agreement shall be governed by the laws of the state of Texas.
Executed and agreed to this 4th day of January, 1999.
SELLER: BUYER:
CM SUPPORT INC. BRASS EAGLE INC.
By: /s/ Roderick Bell By: /s/ Lynn Scott
Title: CHB & CEO Title: President / CEO
/s/ Roderick Bell
ROD BELL
/s/ David Bell
DAVID BELL
/s/ Lamar Lopez
LAMAR LOPEZ
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BRASS EAGLE INC.
ASSET ACQUISITION AGREEMENT (Continued)
The following exhibits are omitted from this document. These exhibits will be
furnished to the Securities and Exchange Commission upon request.
Exhibit A - Detailed Inventory Report and schedule of
assets.
Exhibit E - Security Agreement, dated August 21, 1997,
with LCA Leasing, 9400 Williamsburg Plaza, Suite
200, Louisville, KY 40222, 502-326-1071;
Contract #507-03594-002; Equipment: One
Milltronics Partner I Vertical Machining Center
with Full enclosures, 12 Station ATC, 7. 5 HP
High Torque Heavy Duty Spindle, Rigid Tapping,
14' Color Graphics, S/N M2251; Terms: The sum of
$39,443.40 is payable in 60 monthly installments
of $657.39 per month.
Exhibit F - Exclusive license agreement between
RockSolid Design and C.M. Support, Inc. for `An
Improved Paintball Loader and Paintball Gun
Hopper'.
PATENT ASSIGNMENT - Assignment of United States Patents from CM
Support, Inc. to Brass Eagle Inc.
<PAGE>
BRASS EAGLE INC.
EXHIBIT B
RETAINER AGREEMENT
This Agreement is executed this 4th day of January, 1999, by and between BRASS
EAGLE INC. (the `Company') and DAVID BELL (`Owner').
WHEREAS, the Company is entering into an Asset Acquisition Agreement with CM
Support, Inc., Rod Bell, David Bell and Lamar Lopez (collectively `Seller');
WHEREAS, Owner is willing to lend his expertise on an as-needed basis to aid
the Company in a post-acquisition transition period;
NOW, THEREFORE, the parties hereby agree as follows:
1. In consideration for the Company acquiring the assets of Seller and for
other good and valuable consideration, receipt of which is hereby
acknowledged, Owner agrees to make himself available as a consultant for a
period of one year from the date of this Agreement.
2. Owner shall consult with the Company on various matters relating to the
business including but not limited to:
(a) Technical, production and marketing details relating to the Vortex;
(b) Technical, production and marketing details relating to other
products produced, developed, or under development by Seller.
3. Owner shall be available from time to time, for such hours as may be
needed, at the discretion of the Company, at such locations as the Company
may designate or require and for no additional compensation other than the
consideration previously recited herein; provided however, Owners maximum
required hours shall be as follows:
(a) First two months _ as needed
(b) 3rd month _ 40 hours per month
(c) 4th month _ 20 hours per month
(d) 5th _ 12th month _ 16 hours per month
4. The Company shall reimburse Owner for all reasonable travel expenses plus
other expenses as reasonably required.
5. This Agreement shall be interpreted according to the laws of the State of
Arkansas.
Executed and agreed to this 4th day of January, 1999.
BRASS EAGLE INC. OWNER
By: /s/ Lynn Scott /s/ David Bell
Its: President / CEO DAVID BELL
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BRASS EAGLE INC.
EXHIBIT C
ATTORNEY OPINION LETTER
January 4, 1999
To: Brass Eagle Inc.
c/o John Flynn
Gentlemen:
I have acted as legal counsel for CM Support, Inc. (the `Seller') with regard
to the transaction whereby the Company is selling substantially all of its
assets to Brass Eagle Inc. (the `Buyer'). I have examined the Asset
Acquisition Agreement, all exhibits thereto, an all other such documents that I
deemed necessary in order to forumlate this opinion.
Having reviewed said documents, I declare to the best of my knowledge as
follows:
1. At the closing, occurring concurrently with the delivery of this opinion
letter, the Seller has delivered all the Assets (as defined in the Asset
Acquisition Agreement), free and clear of any liens, and the accompanying
paperwork effectively evidences good title in the Buyer.
2. Seller is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is organized.
3. Seller has all the requisite corporate power and authority to enter into
this Agreement, and entering into this Agreement will not violate any loan
agreement or other agreement or contract of Seller. Seller certifies that
the Board of Directors and shareholders of Seller have approved this
Agreement, pursuant to applicable laws.
4. Seller is current on all reports, filings and permits, and is not in
violation of any laws or regulations, insofar as such violations would
impair the value of the Assets to Buyer.
5. Seller certifies that the sale of goods in the ordinary course of
business, as Seller has been conducting and as reflected in sales on
Seller's income statement, does not violate any laws, rules or regulations
of any state or the Federal government.
6. Seller is in compliance with all laws to the extent they would have a
material, adverse effect on the business or the value of the Assets, in
the hands of Buyer.
7. The balance sheets and income statements presented to Buyer are true and
correct and accurately reflect the financial condition of Seller.
8. Seller has paid all taxes, to the extent such taxes could constitute a
lien on the Assets in the hands of Buyer.
<PAGE>
BRASS EAGLE INC.
EXHIBIT C
ATTORNEY OPINION LETTER (Continued)
9. Seller certifies there are no environmental liabilities relating to
the Assets and will hold Buyer harmless for any such liabilities to the
extent they are caused, created or originate prior to the date of closing.
10. Seller has complied with any Bulk Sales Laws of the State of Texas
to the extent applicable, and will hold Buyer harmless for any liabilities
related thereto.
11. Seller has valid ownership and good title to the trademarks,
licenses and patents described on Exhibit A of the Asset Acquisition
Agreement. Seller will cooperate with Buyer regarding all pending patents
and patent applications.
12. Seller has presented Buyer with documentation allowing release of
all tooling from vendors to Buyer on or before the closing, or thereafter,
at the Buyer's discretion.
13. Seller's employees are all non-union, and said employees are not
participants in any multi-employer pension plans.
This opinion is given solely for the benefit of Buyer, and is to be relied upon
solely in regard to the transaction described in the Asset Acquisition
Agreement.
Sincerely,
/s/ Paul R. Leake
Paul R. Leake
Attorney for CM Support, Inc.
<PAGE>
BRASS EAGLE INC.
EXHIBIT D
CONFIDENTIALITY NONCOMPETITION AGREEMENT
This Confidentiality Noncompetition Agreement (the `Agreement'), dated as of
January 4, 1999, is entered into between Brass Eagle Inc., a Delaware
corporation (the `Company'), and CM Support, Inc. (`Obligor').
RECITAL
The Company and CM Support, Inc., Rod Bell, David Bell and Lamar Lopez
(collectively `Seller') have entered into an Asset Acquisition Agreement of
even date with this Agreement, pursuant to which the Company is acquiring all
of the Assets of Seller, utilized in the operation of the business. The parties
acknowledge that the involvement of Obligor in business activities in
competition with those of the Company or Seller or the disclosure by Obligor of
proprietary or confidential information of the Company or Seller or relating to
the Company or Seller and its business would diminish the value of the business
being acquired by the Company pursuant to the Asset Acquisition Agreement. As
an inducement to the Company to enter into the Asset Acquisition Agreement and
as an integral part of the transactions contemplated by the Asset Acquisition
Agreement, Obligor has agreed to enter into this Agreement.
AGREEMENT
In consideration of the foregoing and of the mutual promises set forth in this
Agreement, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Company and Obligor agree as
follows:
1. CONFIDENTIALITY. Obligor acknowledges that as a result of past activities
Obligor's employees have knowledge of, and access to, all proprietary and
confidential information related to the Seller and its business,
including, without limitation, inventions, trade secrets, technical
information, know-how, products, products under development, sources,
leads or methods or obtaining new products or business, pricing methods of
formulas, cost of supplies, marketing strategies, plans, drawings,
specifications, methods of operations, financial and marketing
information, the identity of customers and suppliers and the Intangible
Property (consisting of patents, trademarks and technical know-how)
(collectively, the `Confidential Information'), and that such information,
even though it may be contributed, developed or acquired by Obligor,
constitutes valuable, special and unique assets of the Company which are
the exclusive property of the Company. Accordingly, Obligor shall not, at
any time, use, reveal, report, publish, transfer or otherwise disclose to
any person any of the Confidential Information without the prior written
consent of the Company's Board of Directors, except to responsible
officers and employees of the Company who have a need for such information
for purposes in the best interests of the Company. Obligor acknowledges
that the Company would not enter into the Asset Acquisition Agreement
without the assurance that all Confidential Information will be used for
the exclusive benefit of the Company. For purposes of this Agreement, the
term Person shall mean any natural person, corporation, unincorporated
organization, partnership, association, joint stock Company, joint
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BRASS EAGLE INC.
EXHIBIT D(Continued)
venture, trust or government, or any agency or political subdivision of
the government, or other entity.
2. NONCOMPETITION. Obligor agrees that in order to protect the value and
good will of the business being acquired, Obligor will not utilize its
special knowledge of the business of the Seller and its relationships with
customers, suppliers and others to compete with the Company for a period
of five years after execution of this Agreement. Obligor shall not engage
or have an interest, anywhere in the United States of America or any other
geographic area where the Company does business or in which its products
or services are marketed, alone or in association with others, as
principal, officer, agent, employee, director, partner or stockholder, or
through the investment of capital, lending of money or property, rendering
of services or otherwise, in any business competitive with or similar to
that engaged in by the Company, including without limitation,
manufacturing, marketing or sale of paintball products or accessories.
During the same period, Obligor shall not, and shall not permit any of
Seller's employees, agents or others under his control to, directly or
indirectly, on behalf of himself or any other Person, (i) call upon,
accept business from, or solicit the business of any Person who is, or who
had been at any time during the preceding two years, a customer of the
Company or Seller or any successor to the business of the Company, or
otherwise divert or attempt to divert any business from the Company or any
such successor, or (ii) recruit or otherwise solicit or induce any person
who is an employee of, or otherwise engaged by, the Company to terminate
his or her employment or other relationship with the Company or such
successor, or hire any person who has left the employ of the Seller or the
Company or any such successor during the preceding two years. Obligor
shall not at any time, directly or indirectly, use or purport to authorize
any Person to use any name, mark, logo, trade dress or other identifying
words or images which are the same as or similar to those used at any time
by the Company in connection with any product or service, whether or not
such use would be in a business competitive with that of the Company.
3. REMEDIES. The restrictions set forth in Sections 1 and 2 are considered
by the parties to be reasonable for the purposes of protecting the value
of the business and goodwill of the Company and Seller. Obligor
acknowledges that the Company would be irreparably harmed and that
monetary damages would not provide an adequate remedy in the event of a
breach of the provisions of Sections 1 or 2. Accordingly, Obligor agrees
that, in addition to any other remedies available to the Company, the
Company shall be entitled to injunctive and other equitable relief to
secure the enforcement of these provisions, and shall be entitled to
receive reimbursement from Obligor for all attorneys' fees and expenses
incurred by the Company in enforcing these provisions. If Obligor
breaches any of the provisions of Sections 1 or 2, in addition to its
other rights and remedies, the Company shall have the right to require
Obligor to account for and pay over to the Company all compensation,
profits, money, accruals and other benefits derived or received, directly
or indirectly, by Obligor from the action constituting such breach. If
Obligor breaches the covenant set forth in Section 2, the running of the
five-year noncompete period described therein shall be tolled for so long
as such breach continues. It is the desire and intent of the parties that
the provisions of Sections 1, 2 and 3 be enforced to the fullest extent
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
permissible under the laws and public policies of each jurisdiction which
enforcement is sought. If any provisions of Sections 1, 2 or 3 relating
to the time period, scope of activities or geographic area of restrictions
is declared by a court of competent jurisdiction to exceed the maximum
permissible time period, scope of activities or geographic area, the
maximum time period, scope of activities of geographic area, as the case
may be, shall be reduced to the maximum which such court deems
enforceable. If any provisions of Sections 1, 2, or 3 other than those
described in the preceding sentence are adjudicated to be invalid or
unenforceable, the invalid or unenforceable provisions shall be deemed
amended (with respect only to the jurisdiction in which such adjudication
is made) in such manner as to render them enforceable and to effectuate as
nearly as possible the original intentions and agreement of the parties.
4. INVENTIONS. Obligor agrees to fully and promptly disclose in writing to
any officer of the Company designated to receive such disclosure, all
discoveries, designs, inventions, developments, improvements and the like
(the `Inventions') whether patentable or not, which arose out of or
otherwise relate to Obligor's business, which Obligor's employees make,
conceive, reduce to practice, work on or advance, whether alone or with
others, during this term of engagement. Obligor understands that all
right, title, interest in and to the Inventions shall be the sole and
exclusive property of the Company, and at the request of the Company,
Obligor shall execute, without charge to the Company, irrevocable
assignments to the Company or its nominees of his entire right, title, and
interest in and to the Inventions throughout the world, including all
patent applications and patents relating thereto and all right to file and
obtain and maintain such applications and patents and to execute any and
all documents necessary or desirable to permit the Company to file such
patent applications. At the Company's request, Obligor shall assist in
securing, defending or enforcing such rights, title and interest.
5. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
of the parties and merges and supersedes any prior or contemporaneous
agreements between the parties pertaining to the subject matter
hereof.
(b) MODIFICATION. This Agreement may not be modified or terminated
orally, and no modification, termination or attempted waiver of any
of the provisions hereof shall be binding unless in writing and
signed by both parties.
(c) WAIVER. Failure of a party to enforce one or more of the provisions
of this Agreement or to require at any time performance of any of the
obligations hereof shall not be construed to be a waiver of such
provisions by such party nor to in any way affect the validity of
this Agreement or such party's right thereafter to enforce any
provision of this Agreement, nor to preclude such party from taking
any other action at any time which it would legally be entitled to
take.
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of, and be binding upon, the parties hereto and their legal
representatives, heirs, successors and assigns.
(e) GOVERNING LAW. This Agreement is made and executed and shall be
governed by the laws of the State of Texas, without regard to the
conflicts of law principles thereof.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement as of the date set forth above.
BRASS EAGLE INC.
By: /s/ Lynn Scott
Its: President / CEO
OBLIGOR:
CM SUPPORT, INC.
By: /s/ Roderick Bell
Its: CHB & CEO
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
CONFIDENTIALITY NONCOMPETITION AGREEMENT
This Confidentiality Noncompetition Agreement (the `Agreement'), dated as of
January 4, 1999, is entered into between Brass Eagle Inc., a Delaware
corporation (the `Company'), and Rod Bell (`Owner').
RECITAL
The Company and CM Support, Inc., Rod Bell, David Bell and Lamar Lopez
(collectively `Seller') have entered into an Asset Acquisition Agreement of
even date with this Agreement, pursuant to which the Company is acquiring all
of the Assets of Seller, utilized in the operation of the business. Owner has
been an owner and an officer of Seller and has substantial knowledge of, and
experience in the business and affairs of the Seller. The parties acknowledge
that the involvement of Owner in business activities in competition with those
of the Company or Seller or the disclosure by Owner of proprietary or
confidential information of the Company or Seller or relating to the Company or
Seller and its business would diminish the value of the business being acquired
by the Company pursuant to the Asset Acquisition Agreement. As an inducement
to the Company to enter into the Asset Acquisition Agreement and as an integral
part of the transactions contemplated by the Asset Acquisition Agreement, Owner
has agreed to enter into this Agreement.
AGREEMENT
In consideration of the foregoing and of the mutual promises set forth in this
Agreement, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Company and Owner agree as
follows:
1. CONFIDENTIALITY. Owner acknowledges that as a result of his past
employment with the Seller and his discussions with the Company, Owner has
knowledge of, and access to, all proprietary and confidential information
related to the Seller and its business, including, without limitation,
inventions, trade secrets, technical information, know-how, products,
products under development, sources, leads or methods or obtaining new
products or business, pricing methods of formulas, cost of supplies,
marketing strategies, plans, drawings, specifications, methods of
operations, financial and marketing information, the identity of customers
and suppliers and the Intangible Property (consisting of patents,
trademarks and technical know-how) (collectively, the `Confidential
Information'), and that such information, even though it may be
contributed, developed or acquired by Owner, constitutes valuable, special
and unique assets of the Company which are the exclusive property of the
Company. Accordingly, Owner shall not, at any time, use, reveal, report,
publish, transfer or otherwise disclose to any person any of the
Confidential Information without the prior written consent of the
Company's Board of Directors, except to responsible officers and employees
of the Company who have a need for such information for purposes in the
best interests of the Company. Owner acknowledges that the Company would
not enter into the Asset Acquisition Agreement without the assurance that
all Confidential Information will be used for the exclusive benefit of the
Company. For purposes of this Agreement, the term Person shall mean any
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
natural person, corporation, unincorporated organization, partnership,
association, joint stock Company, joint venture, trust or government, or
any agency or political subdivision of the government, or other entity.
2. NONCOMPETITION. Owner agrees that in order to protect the value and good
will of the business being acquired, Owner will not utilize his special
knowledge of the business of the Seller and his relationships with
customers, suppliers and others to compete with the Company for a period
of five years after execution of this Agreement. Owner shall not engage
or have an interest, anywhere in the United States of America or any other
geographic area where the Company does business or in which its products
or services are marketed, alone or in association with others, as
principal, officer, agent, employee, director, partner or stockholder, or
through the investment of capital, lending of money or property, rendering
of services or otherwise, in any business competitive with or similar to
that engaged in by the Company, including without limitation,
manufacturing, marketing or sale of paintball products or accessories.
During the same period, Owner shall not, and shall not permit any of
Seller's employees, agents or others under his control to, directly or
indirectly, on behalf of himself or any other Person, (i) call upon,
accept business from, or solicit the business of any Person who is, or who
had been at any time during the preceding two years, a customer of the
Company or Seller or any successor to the business of the Company, or
otherwise divert or attempt to divert any business from the Company or any
such successor, or (ii) recruit or otherwise solicit or induce any person
who is an employee of, or otherwise engaged by, the Company to terminate
his or her employment or other relationship with the Company or such
successor, or hire any person who has left the employ of the Seller or the
Company or any such successor during the preceding two years. Owner shall
not at any time, directly or indirectly, use or purport to authorize any
Person to use any name, mark, logo, trade dress or other identifying words
or images which are the same as or similar to those used at any time by
the Company in connection with any product or service, whether or not such
use would be in a business competitive with that of the Company.
3. REMEDIES. The restrictions set forth in Sections 1 and 2 are considered
by the parties to be reasonable for the purposes of protecting the value
of the business and goodwill of the Company and Seller. Owner
acknowledges that the Company would be irreparably harmed and that
monetary damages would not provide an adequate remedy in the event of a
breach of the provisions of Sections 1 or 2. Accordingly, Owner agrees
that, in addition to any other remedies available to the Company, the
Company shall be entitled to injunctive and other equitable relief to
secure the enforcement of these provisions, and shall be entitled to
receive reimbursement from Owner for all attorneys' fees and expenses
incurred by the Company in enforcing these provisions. If Owner breaches
any of the provisions of Sections 1 or 2, in addition to its other rights
and remedies, the Company shall have the right to require Owner to account
for and pay over to the Company all compensation, profits, money, accruals
and other benefits derived or received, directly or indirectly, by Owner
from the action constituting such breach. If Owner breaches the covenant
set forth in Section 2, the running of the five-year noncompete period
described therein shall be tolled for so long as such breach continues.
It is the desire and intent of the parties that the provisions of Sections
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
1, 2 and 3 be enforced to the fullest extent permissible under the laws
and public policies of each jurisdiction which enforcement is sought. If
any provisions of Sections 1, 2 or 3 relating to the time period, scope of
activities or geographic area of restrictions is declared by a court of
competent jurisdiction to exceed the maximum permissible time period,
scope of activities or geographic area, the maximum time period, scope of
activities of geographic area, as the case may be, shall be reduced to the
maximum which such court deems enforceable. If any provisions of Sections
1, 2, or 3 other than those described in the preceding sentence are
adjudicated to be invalid or unenforceable, the invalid or unenforceable
provisions shall be deemed amended (with respect only to the jurisdiction
in which such adjudication is made) in such manner as to render them
enforceable and to effectuate as nearly as possible the original
intentions and agreement of the parties.
4. INVENTIONS. Owner agrees to fully and promptly disclose in writing to any
officer of the Company designated to receive such disclosure, all
discoveries, designs, inventions, developments, improvements and the like
(the `Inventions') whether patentable or not, which arose out of or
otherwise relate to Owner's engagement for Seller which Owner makes,
conceives, reduces to practice, works on or advances, whether alone or
with others, during this term of engagement. Owner understands that all
right, title, interest in and to the Inventions shall be the sole and
exclusive property of the Company, and at the request of the Company,
Owner shall execute, without charge to the Company, irrevocable
assignments to the Company or its nominees of his entire right, title, and
interest in and to the Inventions throughout the world, including all
patent applications and patents relating thereto and all right to file and
obtain and maintain such applications and patents and to execute any and
all documents necessary or desirable to permit the Company to file such
patent applications. At the Company's request, Owner shall assist in
securing, defending or enforcing such rights, title and interest.
5. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
of the parties and merges and supersedes any prior or contemporaneous
agreements between the parties pertaining to the subject matter
hereof.
(b) MODIFICATION. This Agreement may not be modified or terminated
orally, and no modification, termination or attempted waiver of any
of the provisions hereof shall be binding unless in writing and
signed by both parties.
(c) WAIVER. Failure of a party to enforce one or more of the provisions
of this Agreement or to require at any time performance of any of the
obligations hereof shall not be construed to be a waiver of such
provisions by such party nor to in any way affect the validity of
this Agreement or such party's right thereafter to enforce any
provision of this Agreement, nor to preclude such party from taking
any other action at any time which it would legally be entitled to
take.
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of, and be binding upon, the parties hereto and their legal
representatives, heirs, successors and assigns.
(e) GOVERNING LAW. This Agreement is made and executed and shall be
governed by the laws of the State of Texas, without regard to the
conflicts of law principles thereof.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement as of the date set forth above.
BRASS EAGLE INC.
By: /s/ Lynn Scott
Its: President / CEO
OWNER:
/s/ Roderick Bell
ROD BELL
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
CONFIDENTIALITY NONCOMPETITION AGREEMENT
This Confidentiality Noncompetition Agreement (the `Agreement'), dated as of
January 4, 1999, is entered into between Brass Eagle Inc., a Delaware
corporation (the `Company'), and David Bell (`Owner').
RECITAL
The Company and CM Support, Inc., Rod Bell, David Bell and Lamar Lopez
(collectively `Seller') have entered into an Asset Acquisition Agreement of
even date with this Agreement, pursuant to which the Company is acquiring all
of the Assets of Seller, utilized in the operation of the business. Owner has
been an owner and an officer of Seller and has substantial knowledge of, and
experience in the business and affairs of the Seller. The parties acknowledge
that the involvement of Owner in business activities in competition with those
of the Company or Seller or the disclosure by Owner of proprietary or
confidential information of the Company or Seller or relating to the Company or
Seller and its business would diminish the value of the business being acquired
by the Company pursuant to the Asset Acquisition Agreement. As an inducement
to the Company to enter into the Asset Acquisition Agreement and as an integral
part of the transactions contemplated by the Asset Acquisition Agreement, Owner
has agreed to enter into this Agreement.
AGREEMENT
In consideration of the foregoing and of the mutual promises set forth in this
Agreement, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Company and Owner agree as
follows:
1. CONFIDENTIALITY. Owner acknowledges that as a result of his past
employment with the Seller and his discussions with the Company, Owner has
knowledge of, and access to, all proprietary and confidential information
related to the Seller and its business, including, without limitation,
inventions, trade secrets, technical information, know-how, products,
products under development, sources, leads or methods or obtaining new
products or business, pricing methods of formulas, cost of supplies,
marketing strategies, plans, drawings, specifications, methods of
operations, financial and marketing information, the identity of customers
and suppliers and the Intangible Property (consisting of patents,
trademarks and technical know-how) (collectively, the `Confidential
Information'), and that such information, even though it may be
contributed, developed or acquired by Owner, constitutes valuable, special
and unique assets of the Company which are the exclusive property of the
Company. Accordingly, Owner shall not, at any time, use, reveal, report,
publish, transfer or otherwise disclose to any person any of the
Confidential Information without the prior written consent of the
Company's Board of Directors, except to responsible officers and employees
of the Company who have a need for such information for purposes in the
best interests of the Company. Owner acknowledges that the Company would
not enter into the Asset Acquisition Agreement without the assurance that
all Confidential Information will be used for the exclusive benefit of the
Company. For purposes of this Agreement, the term Person shall mean any
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
natural person, corporation, unincorporated organization, partnership,
association, joint stock Company, joint venture, trust or government, or
any agency or political subdivision of the government, or other entity.
2. NONCOMPETITION. Owner agrees that in order to protect the value and good
will of the business being acquired, Owner will not utilize his special
knowledge of the business of the Seller and his relationships with
customers, suppliers and others to compete with the Company for a period
of five years after execution of this Agreement. Owner shall not engage
or have an interest, anywhere in the United States of America or any other
geographic area where the Company does business or in which its products
or services are marketed, alone or in association with others, as
principal, officer, agent, employee, director, partner or stockholder, or
through the investment of capital, lending of money or property, rendering
of services or otherwise, in any business competitive with or similar to
that engaged in by the Company, including without limitation,
manufacturing, marketing or sale of paintball products or accessories.
During the same period, Owner shall not, and shall not permit any of
Seller's employees, agents or others under his control to, directly or
indirectly, on behalf of himself or any other Person, (i) call upon,
accept business from, or solicit the business of any Person who is, or who
had been at any time during the preceding two years, a customer of the
Company or Seller or any successor to the business of the Company, or
otherwise divert or attempt to divert any business from the Company or any
such successor, or (ii) recruit or otherwise solicit or induce any person
who is an employee of, or otherwise engaged by, the Company to terminate
his or her employment or other relationship with the Company or such
successor, or hire any person who has left the employ of the Seller or the
Company or any such successor during the preceding two years. Owner shall
not at any time, directly or indirectly, use or purport to authorize any
Person to use any name, mark, logo, trade dress or other identifying words
or images which are the same as or similar to those used at any time by
the Company in connection with any product or service, whether or not such
use would be in a business competitive with that of the Company.
3. REMEDIES. The restrictions set forth in Sections 1 and 2 are considered
by the parties to be reasonable for the purposes of protecting the value
of the business and goodwill of the Company and Seller. Owner
acknowledges that the Company would be irreparably harmed and that
monetary damages would not provide an adequate remedy in the event of a
breach of the provisions of Sections 1 or 2. Accordingly, Owner agrees
that, in addition to any other remedies available to the Company, the
Company shall be entitled to injunctive and other equitable relief to
secure the enforcement of these provisions, and shall be entitled to
receive reimbursement from Owner for all attorneys' fees and expenses
incurred by the Company in enforcing these provisions. If Owner breaches
any of the provisions of Sections 1 or 2, in addition to its other rights
and remedies, the Company shall have the right to require Owner to account
for and pay over to the Company all compensation, profits, money, accruals
and other benefits derived or received, directly or indirectly, by Owner
from the action constituting such breach. If Owner breaches the covenant
set forth in Section 2, the running of the five-year noncompete period
described therein shall be tolled for so long as such breach continues.
It is the desire and intent of the parties that the provisions of Sections
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
1, 2 and 3 be enforced to the fullest extent permissible under the laws
and public policies of each jurisdiction which enforcement is sought. If
any provisions of Sections 1, 2 or 3 relating to the time period, scope of
activities or geographic area of restrictions is declared by a court of
competent jurisdiction to exceed the maximum permissible time period,
scope of activities or geographic area, the maximum time period, scope of
activities of geographic area, as the case may be, shall be reduced to the
maximum which such court deems enforceable. If any provisions of Sections
1, 2, or 3 other than those described in the preceding sentence are
adjudicated to be invalid or unenforceable, the invalid or unenforceable
provisions shall be deemed amended (with respect only to the jurisdiction
in which such adjudication is made) in such manner as to render them
enforceable and to effectuate as nearly as possible the original
intentions and agreement of the parties.
4. INVENTIONS. Owner agrees to fully and promptly disclose in writing to any
officer of the Company designated to receive such disclosure, all
discoveries, designs, inventions, developments, improvements and the like
(the `Inventions') whether patentable or not, which arose out of or
otherwise relate to Owner's engagement for Seller which Owner makes,
conceives, reduces to practice, works on or advances, whether alone or
with others, during this term of engagement. Owner understands that all
right, title, interest in and to the Inventions shall be the sole and
exclusive property of the Company, and at the request of the Company,
Owner shall execute, without charge to the Company, irrevocable
assignments to the Company or its nominees of his entire right, title, and
interest in and to the Inventions throughout the world, including all
patent applications and patents relating thereto and all right to file and
obtain and maintain such applications and patents and to execute any and
all documents necessary or desirable to permit the Company to file such
patent applications. At the Company's request, Owner shall assist in
securing, defending or enforcing such rights, title and interest.
5. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
of the parties and merges and supersedes any prior or contemporaneous
agreements between the parties pertaining to the subject matter
hereof.
(b) MODIFICATION. This Agreement may not be modified or terminated
orally, and no modification, termination or attempted waiver of any
of the provisions hereof shall be binding unless in writing and
signed by both parties.
(c) WAIVER. Failure of a party to enforce one or more of the provisions
of this Agreement or to require at any time performance of any of the
obligations hereof shall not be construed to be a waiver of such
provisions by such party nor to in any way affect the validity of
this Agreement or such party's right thereafter to enforce any
provision of this Agreement, nor to preclude such party from taking
any other action at any time which it would legally be entitled to
take.
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of, and be binding upon, the parties hereto and their legal
representatives, heirs, successors and assigns.
(e) GOVERNING LAW. This Agreement is made and executed and shall be
governed by the laws of the State of Texas, without regard to the
conflicts of law principles thereof.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement as of the date set forth above.
BRASS EAGLE INC.
By: /s/ Lynn Scott
Its: President / CEO
OWNER:
/s/ David Bell
DAVID BELL
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
CONFIDENTIALITY NONCOMPETITION AGREEMENT
This Confidentiality Noncompetition Agreement (the `Agreement'), dated as of
January 4, 1999, is entered into between Brass Eagle Inc., a Delaware
corporation (the `Company'), and Lamar Lopez (`Owner').
RECITAL
The Company and CM Support, Inc., Rod Bell, Dave Bell and Lamar Lopez
(collectively `Seller') have entered into an Asset Acquisition Agreement of
even date with this Agreement, pursuant to which the Company is acquiring all
of the Assets of Seller, utilized in the operation of the business. Owner has
been an owner of Seller and has substantial knowledge of, and experience in the
business and affairs of the Seller. The parties acknowledge that the
involvement of Owner in business activities in competition with those of the
Company or Seller or the disclosure by Owner of proprietary or confidential
information of the Company or Seller or relating to the Company or Seller and
its business would diminish the value of the business being acquired by the
Company pursuant to the Asset Acquisition Agreement. As an inducement to the
Company to enter into the Asset Acquisition Agreement and as an integral part
of the transactions contemplated by the Asset Acquisition Agreement, Owner has
agreed to enter into this Agreement.
AGREEMENT
In consideration of the foregoing and of the mutual promises set forth in this
Agreement, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Company and Owner agree as
follows:
1. CONFIDENTIALITY. Owner acknowledges that as a result of his past
employment with the Seller and his discussions with the Company, Owner has
knowledge of, and access to, all proprietary and confidential information
related to the Seller and its business, including, without limitation,
inventions, trade secrets, technical information, know-how, products,
products under development, sources, leads or methods or obtaining new
products or business, pricing methods of formulas, cost of supplies,
marketing strategies, plans, drawings, specifications, methods of
operations, financial and marketing information, the identity of customers
and suppliers and the Intangible Property (consisting of patents,
trademarks and technical know-how) (collectively, the `Confidential
Information'), and that such information, even though it may be
contributed, developed or acquired by Owner, constitutes valuable, special
and unique assets of the Company which are the exclusive property of the
Company. Accordingly, Owner shall not, at any time, use, reveal, report,
publish, transfer or otherwise disclose to any person any of the
Confidential Information without the prior written consent of the
Company's Board of Directors, except to responsible officers and employees
of the Company who have a need for such information for purposes in the
best interests of the Company. Owner acknowledges that the Company would
not enter into the Asset Acquisition Agreement without the assurance that
all Confidential Information will be used for the exclusive benefit of the
Company. For purposes of this Agreement, the term Person shall mean any
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
natural person, corporation, unincorporated organization, partnership,
association, joint stock Company, joint venture, trust or government, or
any agency or political subdivision of the government, or other entity.
2. NONCOMPETITION. Owner agrees that in order to protect the value and good
will of the business being acquired, Owner will not utilize his special
knowledge of the business of the Seller and his relationships with
customers, suppliers and others to compete with the Company for a period
of five years after execution of this Agreement. Owner shall not engage
or have an interest, anywhere in the United States of America or any other
geographic area where the Company does business or in which its products
or services are marketed, alone or in association with others, as
principal, officer, agent, employee, director, partner or stockholder, or
through the investment of capital, lending of money or property, rendering
of services or otherwise, in any business competitive with or similar to
that engaged in by the Company, but only to the extent that Owner's new
business utilizes products manufactured, sold, conceived, designed or
partially designed by Seller on or before January 4, 1999. As indicated
in the Asset Acquisition Agreement, the Viewless Mounting System is also
expressly excepted. Owner shall not at any time, directly or indirectly,
use or purport to authorize any Person to use any name, mark, logo, trade
dress or other identifying words or images which are the same as or
similar to those used at any time by the Company in connection with any
product or service, whether or not such use would be in a business
competitive with that of the Company.
2. REMEDIES. The restrictions set forth in Sections 1 and 2 are considered
by the parties to be reasonable for the purposes of protecting the value
of the business and goodwill of the Company and Seller. Owner
acknowledges that the Company would be irreparably harmed and that
monetary damages would not provide an adequate remedy in the event of a
breach of the provisions of Sections 1 or 2. Accordingly, Owner agrees
that, in addition to any other remedies available to the Company, the
Company shall be entitled to injunctive and other equitable relief to
secure the enforcement of these provisions, and shall be entitled to
receive reimbursement from Owner for all attorneys' fees and expenses
incurred by the Company in enforcing these provisions. If Owner breaches
any of the provisions of Sections 1 or 2, in addition to its other rights
and remedies, the Company shall have the right to require Owner to account
for and pay over to the Company all compensation, profits, money, accruals
and other benefits derived or received, directly or indirectly, by Owner
from the action constituting such breach. If Owner breaches the
covenant set forth in Section 2, the running of the five-year noncompete
period described therein shall be tolled for so long as such breach
continues. It is the desire and intent of the parties that the provisions
of Sections 1, 2 and 3 be enforced to the fullest extent permissible under
the laws and public policies of each jurisdiction which enforcement is
sought. If any provisions of Sections 1, 2 or 3 relating to the time
period, scope of activities or geographic area of restrictions is declared
by a court of competent jurisdiction to exceed the maximum permissible
time period, scope of activities or geographic area, the maximum time
period, scope of activities of geographic area, as the case may be, shall
be reduced to the maximum which such court deems enforceable. If any
provisions of Sections 1, 2, or 3 other than those described in the
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
preceding sentence are adjudicated to be invalid or unenforceable, the
invalid or unenforceable provisions shall be deemed amended (with respect
only to the jurisdiction in which such adjudication is made) in such
manner as to render them enforceable and to effectuate as nearly as
possible the original intentions and agreement of the parties.
4. INVENTIONS. Owner agrees to fully and promptly disclose in writing to any
officer of the Company designated to receive such disclosure, all
discoveries, designs, inventions, developments, improvements and the like
(the `Inventions') whether patentable or not, which arose out of or
otherwise relate to Owner's engagement for Seller which Owner makes,
conceives, reduces to practice, works on or advances, whether alone or
with others, during this term of engagement. Owner understands that all
right, title, interest in and to the Inventions shall be the sole and
exclusive property of the Company, and at the request of the Company,
Owner shall execute, without charge to the Company, irrevocable
assignments to the Company or its nominees of his entire right, title, and
interest in and to the Inventions throughout the world, including all
patent applications and patents relating thereto and all right to file and
obtain and maintain such applications and patents and to execute any and
all documents necessary or desirable to permit the Company to file such
patent applications. At the Company's request, Owner shall assist in
securing, defending or enforcing such rights, title and interest, at the
Company's expense.
5. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
of the parties and merges and supersedes any prior or contemporaneous
agreements between the parties pertaining to the subject matter
hereof.
(b) MODIFICATION. This Agreement may not be modified or terminated
orally, and no modification, termination or attempted waiver of any
of the provisions hereof shall be binding unless in writing and
signed by both parties.
(c) WAIVER. Failure of a party to enforce one or more of the provisions
of this Agreement or to require at any time performance of any of the
obligations hereof shall not be construed to be a waiver of such
provisions by such party nor to in any way affect the validity of
this Agreement or such party's right thereafter to enforce any
provision of this Agreement, nor to preclude such party from taking
any other action at any time which it would legally be entitled to
take.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of, and be binding upon, the parties hereto and their legal
representatives, heirs, successors and assigns.
(e) GOVERNING LAW. This Agreement is made and executed and shall be
governed by the laws of the State of Texas, without regard to the
conflicts of law principles thereof.
<PAGE>
BRASS EAGLE INC.
EXHIBIT D(Continued)
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement as of the date set forth above.
BRASS EAGLE INC.
By: /s/ Lynn Scott
Its: President / CEO
OWNER:
/s/ Lamar Lopez
LAMAR LOPEZ
<PAGE>
BRASS EAGLE INC.
BILL OF SALE
CM Support, Inc. (`Seller') of Dallas, Texas hereby sells to Brass Eagle Inc.
(`Buyer') of Rogers, Arkansas all of its assets, tangible and intangible,
including but not limited to those listed on Exhibit A of the Asset Acquisition
Agreement of even date herewith, but excepting the patent on the Viewless
Mounting System, all bank accounts of CM Support, Inc., all financial and
business records of CM Support, Inc. and accounts receivable, for the sum of
$5,000,000.00
Seller hereby gives warrant of good title and warranties of merchantability and
fitness for a particular purpose.
Seller warrants that there are no liens on any of the property, except as
indicated on the Asset Acquisition Agreement of even date herewith.
Executed and Agreed to this 4th day of January, 1999.
CM SUPPORT, INC. BRASSE EAGLE INC.
By: /s/ Roderick Bell By: /s/ Lynn Scott
Its: CHB & CEO Its: President / CEO
<PAGE>
BRASS EAGLE INC.
TRADEMARK ASSIGNMENT
WHEREAS, CM Support, Inc., a Texas corporation having its principal place
of business at 4921 Olson Dr., Dallas, Texas 75227 (hereinafter `ASSIGNOR'), is
the owner of the following United States trademarks and trademark applications
(hereinafter "the Trademarks"):
MARK: Viewloader Common Law Usage
Serial No. 75/364,648
Registration Application Filed: September 29, 1997
WHEREAS, BRASS EAGLE INC., a Delaware corporation having its principal
place of business at 1203 North 6th Street, Rogers, Arkansas 72756 (hereinafter
`ASSIGNEE'), is desirous of acquiring all of the right, title and interest of
ASSIGNOR in and to the Trademarks;
NOW, THEREFORE, for and in consideration of the sum of One Dollar ($1.00)
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, ASSIGNOR hereby sells, assigns, transfers and conveys
to ASSIGNEE all right, title and interest in and to the Trademarks, free and
clear of all liens and encumbrances, to be held and enjoyed by ASSIGNEE, its
successors and assigns, as fully and entirely as the same would have been held
and enjoyed by ASSIGNOR had this Assignment and sale not been made.
The United States Patent and Trademark Office is hereby authorized to
deliver to ASSIGNEE, its attorneys, agents, successors or assigns, all official
documents and communications as may be warranted by this Assignment.
In testimony whereof, ASSIGNOR has caused this Assignment to be signed by
its duly authorized officer and its seal to be affixed this 4th day of January,
1999.
CM SUPPORT, INC.
(SEAL) By: /s/ Roderick Bell
Title: CHB & CEO
CERTIFICATE OF EXECUTION
Before me this 4th day of January, 1999, personally appeared Roderick Bell,
known to me to be the person who executed this Assignment, and who acknowledged
that such Assignment was executed for the purpose therein expressed.
/s/ Vicki Feuerbacher
Notary Seal Notary Public
My Commission Expires: 6-21-99
<PAGE>
BRASS EAGLE INC.
January 4, 1999
To: CM Support, Inc.
Brass Eagle Inc.
Re: TOOLING IN POSSESSION OF VENDOR
Vendor hereby affirms that all tooling of CM Support, Inc. (see attached
Addendum A) in vendor's possession will be released to Brass Eagle Inc. at
Brass Eagle's request, without requiring a payment from Brass Eagle Inc. of any
kind.
Vendor hereby waives any mechanics' liens or other liens it may claim against
such tooling.
Vendor acknowledges ownership of all such tooling to reside in Brass Eagle
Inc., free and clear of all liens.
VENDOR
C & G Plastics Inc.
VENDOR NAME
By: /s/ Glenda Seargeant
Its: Owner / VP
<PAGE>
BRASS EAGLE INC.
TOOLING IN POSSESSION OF VENDOR (Continued)
ADDENDUM A
Tooling in Vendor's Possession:
V1200 MOLD
V1REV MOLD
TUBE2 MOLD
TUBE3 MOLD
ADDFER MOLD
V1LID MOLD
TUBELID MOLD
<PAGE>
BRASS EAGLE INC.
January 4, 1999
INDEMNITY
CM Support, Inc., Rod Bell, David Bell and Lamar Lopez (collectively `Seller')
hereby agree to indemnify and hold Brass Eagle Inc. (`Buyer') harmless from any
liability to third party vendors holding Seller's tooling. Seller asserts that
Buyer may recover all such tooling from third party vendors without cost to
Buyer, and Seller agrees to take all steps to achieve release of such tooling
to Buyer at no cost to Buyer.
CM SUPPORT, INC.
By: /s/ Roderick Bell
Its: CHB & CEO
/s/ Roderick Bell
ROD BELL
/s/ David Bell
DAVID BELL
/s/ Lamar Lopez
LAMAR LOPEZ
<PAGE>
EXHIBIT 99
BRASS EAGLE INC.
PRESS RELEASE
Company Contact: J. R. Brian Hanna
Brass Eagle Inc.
Chief Financial Officer
(501) 986-6630
FOR IMMEDIATE RELEASE
Investor Relations: Chad A. Jacobs / Thomas M. Ryan
Integrated Corporate Relations
(203) 222-9013
[email protected]
BRASS EAGLE INC. ACQUIRES ASSETS OF CM SUPPORT, INC.
Rogers, AR, January 6, 1999 _ Brass Eagle Inc. (Nasdaq: XTRM) the worldwide
leader in the manufacturing, marketing and distribution of paintball products
today announced the acquisition of certain assets of CM Support, Inc. of
Dallas, Texas for $5 million in cash.
CM Support, Inc. is the leading manufacturer and marketer of feeder loaders,
tubes and accessories used in the paintball industry sold under the highly
recognized ViewLoader _TM- trademark. The CM Support, Inc. product line,
regarded as first quality in the industry, includes the VL 200 standard
loaders, the VL 104 Attitubes, the VL Revolution electronic agitator loaders,
the VL squeegees, the VL hopper elbows and the VL barrel plugs.
Lynn Scott, Brass Eagle President and CEO stated, `We are very excited about
acquiring one of the leading product lines in paintball today. CM Support has
previously been a primary supplier to Brass Eagle of select products, and the
company's overall line has historically been sold direct or through
distributors to the traditional paintball industry. Our plans are to maintain
the current customer base while using Brass Eagle's retail distribution network
to greatly expand the availability and accessibility to the broader ViewLoader
- -TM- product line.'
According to the company, the acquisition will result in increased market
share, improved margins, expanded retail product offerings and further
penetration into the traditional paintball market. The acquisition will be
accretive to income in 1999.
Mr. Scott concluded, `We continue to look for underdeveloped brands and
products with the highest reputations for quality and innovative designs to
strengthen our product offering. We remain excited about the prospects of our
business and the continued growth in the popularity of paintball which appeals
to a wide demographic including, in particular, the youth market which
represents 66 million individuals and $500 billion in spending power.'
Brass Eagle is unique in providing a full line of paintball guns and accessory
products from beginner through competition level. The Company is the dominant
supplier of products for this rapidly growing sport. Brass Eagle has been
named one of the `Top 100' Hot Growth Companies by Business Week magazine and
one of the IW Growing Companies 25, America's Most Successful Small
Manufacturers by Industry Week magazine.<PAGE>
