Litigation Financing Research: Today I decided
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Posted On: 07/20/2018 2:28:28 PM
Litigation Financing Research:
Today I decided to read our latest 10Q again and see if I noticed anything that I didn't before. I did find something about the litigation financing:
"Note 7 – Contingent Payment Obligation
On September 6, 2017, the Company entered into a litigation funding agreement with Therium Inc. and VGL Capital, LLC (collectively the “Funders”). Under the agreement, the Company received $1,500,000 from the Funders to allow the Company to pursue patent enforcement actions against infringements of its patents (see Note 11). In exchange, the Funders are entitled to receive, after the payment of legal fees, the first $1,500,000 from the gross proceeds of any claims awarded, 10% of any additional claim proceeds until the Funders have received an additional $7,500,000, and 2.5% of any claim proceeds thereafter. The Funders shall be paid only in the event that the Company achieves recoveries of claim proceeds. The terms of the litigation funding agreement allow for additional funding of $1,500,000, between February 1, 2018 to January 31, 2019, which would require the Company to repay the funders an additional $5,000,000, plus a percentage of any claim proceeds thereafter. At March 31, 2018 and December 31, 2017, the Company has reflected the $1,500,000 as a contingent payment obligation to be paid only if claim proceeds are recovered. "
Therium Inc. is one of the funders, their website is here:
http://www.therium.com/
I don't know much about litigation financing other than my gut feeling tells me that you don't get this unless it is a sure thing pretty much. It spells that out right here on their website IMHO:
"Realise the value of your claim."
Today I decided to read our latest 10Q again and see if I noticed anything that I didn't before. I did find something about the litigation financing:
"Note 7 – Contingent Payment Obligation
On September 6, 2017, the Company entered into a litigation funding agreement with Therium Inc. and VGL Capital, LLC (collectively the “Funders”). Under the agreement, the Company received $1,500,000 from the Funders to allow the Company to pursue patent enforcement actions against infringements of its patents (see Note 11). In exchange, the Funders are entitled to receive, after the payment of legal fees, the first $1,500,000 from the gross proceeds of any claims awarded, 10% of any additional claim proceeds until the Funders have received an additional $7,500,000, and 2.5% of any claim proceeds thereafter. The Funders shall be paid only in the event that the Company achieves recoveries of claim proceeds. The terms of the litigation funding agreement allow for additional funding of $1,500,000, between February 1, 2018 to January 31, 2019, which would require the Company to repay the funders an additional $5,000,000, plus a percentage of any claim proceeds thereafter. At March 31, 2018 and December 31, 2017, the Company has reflected the $1,500,000 as a contingent payment obligation to be paid only if claim proceeds are recovered. "
Therium Inc. is one of the funders, their website is here:
http://www.therium.com/
I don't know much about litigation financing other than my gut feeling tells me that you don't get this unless it is a sure thing pretty much. It spells that out right here on their website IMHO:
"Realise the value of your claim."
(3)
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My comments are only my opinion and are not to be used for investment advice. Please conduct your own due diligence before choosing to buy or sell any investment.
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