MGTI MGT Capital Investments Inc (PK)

Item 1.01 Entry into a Material Definitive Agreement

On May 26, 2016, MGT Capital Investment Inc., a Delaware corporation (the “ Company ”) and MGT Cybersecurity, Inc., a Delaware corporation wholly owned by the Company, entered into an asset purchase agreement (the “ APA ”) with Demonsaw LLC, a Delaware company (“ Demonsaw ”) and the shareholders of Demonsaw, for the purchase of certain technology and assets of Demonsaw.

Demonsaw is in the business of developing and marketing certain secure and anonymous information sharing applications (the “ Business ”). Pursuant to the terms of the APA, the Company has agreed to purchase assets (“ Purchased Assets ”) integral to Demonsaw’s Business, including but not limited to the source code for the Demonsaw solution, intellectual property, customer lists, databases, sales pipelines, proposals and project files, licenses and permits. Among the Purchased Assets is the Demonsaw application which is designed for use in Windows and Apple operating systems.

Upon the closing of the transaction contemplated in the APA, the Company will acquire the Purchased Assets in consideration of (i) 4 million unregistered shares of Common Stock of the Company (the “ Escrow Shares ”) to be held in escrow for six months pending satisfaction of the representation and warranties in the APA; and (iii) 16 million unregistered shares of Common Stock of the Company (the “ Closing Shares ” together with Escrow Shares as “ Purchase Price Shares ”)

The APA includes customary representation and warranties of the parties as well as termination and closing conditions. The closing of the transaction contemplated in the APA is contingent on satisfaction or waiver of the closing conditions set therein including the approval of the Company’s shareholders and an appraisal report of the Assets from independent investment bank or other qualified institutions. The Company also agreed as part of the closing conditions to enter into an employment agreement with Eric J. Anderson who shall be appointed as Chief Technology Officer of the Company upon closing of the transaction contemplated in the APA. There can be no assurance that the conditions to closing the transactions described herein can be obtained nor that the transaction will be closed.

The foregoing descriptions of the APA does not purport to be complete and is qualified in its entirety by reference to the full text of the APA, which are filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.