NeoMagic Corporation (NASDAQ:NMGC) , a leader and pioneer in developing and delivering low-power solutions for multimedia-rich mobile phones and handheld devices, announced today that it has signed an agreement to sell selected patents and patent applications to Faust Communications Holdings, LLC for $12.5 million, providing net proceeds of $9.5 million after agency commissions. The patents and patent applications sold relate to certain of NeoMagic’s non-essential patents. NeoMagic will retain a worldwide, non-exclusive, royalty-free license to use the technology covered by these patents and patent applications for all of its current and future products. The transaction is anticipated to close and fund within approximately 35 days, subject to customary closing conditions.

“We are particularly pleased with this patent sale transaction, as it reflects a true acknowledgement of the value of this technology,” stated Douglas Young, President and CEO of NeoMagic Corporation. “We also want to recognize the innovative contributions of Deepraj Puar, our Vice President of Operations, and inventor of the embedded DRAM patents sold in this transaction. We wish to acknowledge and thank Deep for his technology developments along with his contributions to the monetization of these patents,” concluded Young.