OCZ Technology Group,
Inc. OCZ, a leading provider of high-performance solid
state drives (SSDs) for computing devices and systems, today
announced that on November 25, 2013, it received notices that
Hercules Technology Growth Capital, Inc. HTGC took exclusive
control of the Company's depository accounts at Silicon Valley Bank
and Wells Fargo Bank, National Association. As set forth in the
Company's recent SEC filings, Hercules and the Company are parties to
a loan and security agreement. As previously reported, the Company is
not in compliance with certain of the operating ratios and covenants
in the loan agreement. As a result of such action and pursuant to
Hercules' written instruction, the depository institutions disbursed
the cash in the Company's respective accounts to accounts under the
control of Hercules.
The Company has received an offer from Toshiba Corporation to acquire
substantially all of the Company's assets in a bankruptcy proceeding.
The parties have substantially completed negotiations on an asset
purchase agreement and OCZ believes that all the material terms have
been agreed to. The agreement is subject to various conditions: the
preservation of the value of the business, including the retention of
employees, the negotiation and execution of definitive documentation,
the filing of bankruptcy petitions by the Company and certain of its
subsidiaries, Toshiba's offer being accepted by the bankruptcy court
as the highest and best offer under the circumstances after an
auction process conducted under the relevant provisions of the United
States Bankruptcy Code, and other customary closing conditions. The
Company expects to file a petition for bankruptcy shortly after
completing final documentation with Toshiba and Hercules, and to
conduct the court-supervised auction process to attempt to maximize
the value of the Company's assets and operations in an orderly
process. More details will become available when the Company files
its petition for bankruptcy.
If the Company is not able to agree to final documentation with
Toshiba, the Company expects to imminently file a petition for
bankruptcy and liquidate.
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