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ParkerVision Reports Second Quarter 2019 Results; Touts Litigation Financing of its IP Claims for Reduction in Operating Costs

By John Freund |

JACKSONVILLE, FL / ACCESSWIRE / August 14, 2019 / ParkerVision, Inc. (PRKR), a developer and marketer of technologies and products for wireless applications, today announced results for the three and six months ended June 30, 2019.

Second Quarter 2019 Summary and Recent Developments

  • Louis Freeh and Freeh Sporkin & Sullivan LLP joined the ParkerVision litigation team in June 2019.
    • Freeh, former federal judge and FBI Director, has been admitted as the Company’s counsel alongside Mintz Levin and Mckool Smith in the Company’s two district court patent infringement cases in Florida.
  • The District Court in the Middle District of Florida (Jacksonville division) issued an order denying Apple’s motion for summary judgment in the pending patent litigation against Qualcomm and Apple and also issued its claim construction (Markman) order, in which the Court adopted the Company’s proposed construction for two terms and the “plain and ordinary meaning” on the remaining terms.
    • A case management schedule has been submitted to the court with a proposed trial date in August 2020.
  • The District Court for the Middle District of Florida (Orlando division) granted the Company’s proposed selection of patent claims from four asserted patents and denied Qualcomm’s request to limit the claims and patents, including claims that survived Qualcomm’s validity challenges through Inter Partes Review (“IPR”).
    • The court also agreed that the Company may elect to pursue accused products that were at issue at the time the case was stayed, as well as new products that were released by Qualcomm during the pendency of the stay.
    • A case management schedule has been submitted to the court with a proposed trial date in December 2020.
  • The Company has withdrawn its pursuit of appellate actions in Germany.
    • The Company declined to appeal the April 2019 decision by the District Court of Munich Germany that Apple does not infringe the Company’s German ‘853 patent.
    • The Company recently withdrew its appeal of the October 2018 decision by the Federal Patent Court in Munich that ruled the Company’s German ‘831 patent is invalid.

Second Quarter and First Half Financial Results

  • Net loss for the second quarter of 2019 was $1.6 million, or $0.05 per common share, compared to a $4.5 million net loss, or $0.18 per common share, for the second quarter of 2018.
  • Net loss for the first half of 2019 was $3.7 million, or $0.12 per common share, compared to an $8.8 million net loss, or $0.39 per common share, for the first half of 2018.
  • Cash used for operations decreased approximately 68% in the second quarter of 2019 compared to the same period in 2018 as a result of the Company’s cost reduction measures.
  • The Company sold $1.64 million in five-year, 8% convertible notes during the first half of 2019. Of this amount, $1.3 million have a fixed conversion price of $0.25 per share and $0.34 million have a fixed conversion price of $0.10 per share. The majority of the proceeds were used to finance operations, with $0.15 million used for retention payments to legal counsel engaged to assist in a wide range of litigation related activities.

Jeffrey Parker, Chairman and Chief Executive Officer, commented, “We are pleased with the recent decisions from the two district courts in Florida and are looking forward to having trial dates set in both of those cases. Our decisions to abandon our appellate actions in Germany were made based on the lengthy timeframe that this process requires, and our belief that the best return for our shareholders and the fairest compensation for the unauthorized use of our technologies can be achieved by focusing our resources on the two U.S. district court actions.”

Mr. Parker continued, “We have significantly reduced operating costs over the past year, and we believe those reductions, paired with additional litigation financing for the completion of our cases in Florida, will enable us to see these cases through to conclusion. Our longer-term goal is to rebuild ParkerVision’s innovative culture and to continue to bring new solutions to the challenges of a wireless world.”

About ParkerVision

ParkerVision, Inc. has designed and developed proprietary radio-frequency (RF) technologies which enable advanced wireless solutions for current and next generation wireless communication products. ParkerVision is engaged in a number of patent enforcement actions to protect patented rights that it believes are broadly infringed by others. For more information, please visit www.parkervision.com. (PRKR-I)

Safe Harbor Statement

This press release contains forward-looking information. Readers are cautioned not to place undue reliance on any such forward-looking statements, each of which speaks only as of the date made. Such statements are subject to certain risks and uncertainties which are disclosed in the Company’s SEC reports, including the Form 10-K for the year ended December 31, 2018 and the Forms 10-Q for the quarters ended March 31 and June 30, 2019. These risks and uncertainties could cause actual results to differ materially from those currently anticipated or projected.

Contact:
Cindy Poehlman
Chief Financial Officer
ParkerVision, Inc.
904-732-6100
cpoehlman@parkervision.com

ParkerVision, Inc.
Balance Sheet Highlights

(in thousands)
(unaudited)
June 30, 2019
December 31, 2018
Cash and cash equivalents$63$1,527
Prepaid expenses637538
Accounts receivable and other current assets51122
Finished goods inventories5898
Property and equipment, net96129
Operating lease right-of-use assets364–
Intangible assets & other3,3573,917
Total assets4,6266,331
Accounts payable and other accrued expenses2,8101,833
Operating lease liabilities, current portion26486
Notes payable, current portion1,9332,437
Long-term liabilities28,30527,285
Shareholders’ deficit(28,686)(25,310)
Total liabilities and shareholders’ deficit$4,626$6,331

ParkerVision, Inc.
Summary of Results of Operations (unaudited)

Three Months EndedSix Months Ended
(in thousands, except per share amounts)June 30,June 30,
2019201820192018
Product revenue$25$38$35$115
Cost of sales(25)(31)(35)(84)
Write down of obsolete inventory–(42)–(42)
Gross margin–(35)–(11)
Research and development expenses–1,0013341,875
Selling, general and administrative expenses1,8512,9024,0075,879
Total operating expenses1,8513,9034,3417,754
Interest and other income (expense)(76)(18)(138)(32)
Change in fair value of contingent payment obligation365(538)823(987)
Total interest and other289(556)685(1,019)
Net loss$(1,562)$(4,494)$(3,656)$(8,784)
Basic and diluted net loss per common share$(0.05)$(0.18)$(0.12)$(0.39)
Weighted average shares outstanding30,88824,56430,04222,672

ParkerVision, Inc.
Condensed Consolidated Statements of Cash Flows (unaudited)

Three Months EndedSix Months Ended
(in thousands)June 30,June 30,
2019201820192018
Net cash used in operating activities$(877)$(2,775)$(2,550)$(6,126)
Net cash provided by (used in) investing activities–2617
Net cash provided by (used in) financing activities5652,6021,0804,854
Net decrease in cash and cash equivalents(312)(171)(1,464)(1,255)
Cash and cash equivalents – beginning of period3752701,5271,354
Cash and cash equivalents – end of period$63$99$63$99

SOURCE: ParkerVision, Inc.

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John Freund

John Freund

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Announcements Commercial People Moves

ALFA Welcomes Mackay Chapman as Newest Associate Member

By Harry Moran |

In a post on LinkedIn, The Association of Litigation Funders of Australia (ALFA) announced that it is welcoming Mackay Chapman as its newest Associate Member. Mackay Chapman becomes the 12th Associate Member of ALFA, following the inclusion of Litica in April of this year.

Mackay Chapman is a boutique legal and advisory firm, specialising in high-stakes regulatory, financial services and insolvency disputes. The Melbourne-based law firm was founded in 2016 by Dan Mackay and Michael Chapman, who bring 25 years of experience in complex disputes to the business.More information about Mackay Chapman can be found on its website.

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Announcements Commercial Fundraising

CASL Targets Australian Investors in Launch of New $150M Litigation Fund

By Harry Moran |

Leading Australian litigation funder CASL today launched a $150 million fund giving local investors the opportunity to participate in funding of selected new class actions including product liability and other mass consumer claims, commercial litigation and insolvency claims. 

CASL Fund 2 is expected to appeal to Australian sophisticated investors seeking exposure to a truly alternative asset class with attractive risk-adjusted returns and a capital-protected option. The fund is well suited to high-net worth individuals, family offices and foundations seeking to diversify into uncorrelated ESG assets. 

Co-founded in 2020 by two of Australia’s most experienced litigation funders, John Walker and Stuart Price, CASL has quickly established a reputation as an astute backer of legal claims in the competitive Australian market. The two completed actions filed with the backing of CASL’s inaugural $156 million fund since 2022 have returned 165% to investors; another 11 actions are in progress. 

Considered a pioneer of litigation funding in Australia, CASL Executive Chair John Walker co-founded IMF Bentham, now Omni Bridgeway, in 1998 while CASL CEO Mr Price was CEO of Litigation Lending Services for six years prior to co-founding CASL. 

Mr Price said litigation funding had an important role to play in levelling the legal playing field for victims of corporate or government misconduct, and investors were important partners in this process. 

“In global terms Australia is a receptive jurisdiction for the filing of group claims and funded actions but there is increasingly a premium on funders with proven expertise in sourcing and qualifying claims, and managing them to a successful resolution,” Mr Price said. 

“CASL brings that – our team has a proven record for deploying funds efficiently in support of worthy claims and generating strong financial outcomes for both claimants and investors. 

“We see a healthy pipeline of potential new actions in Australia with good prospects and considerable upside for investors willing to fund them. This fund will be a rare opportunity for investors to participate in a purely domestic litigation funding play backed by an experienced local team with a proven record for generating returns for investors. Early indications are we have $30 million in investor pre-commitments so there is clearly an appetite for litigation funding as an alternative asset class.” 

The combined success rate of 183 funded claims involving Mr Walker or Mr Price since 1996 is 92%. These cases have delivered settlement proceeds of $2.6 billion with an average duration of two and half years. 

The launch of CASL Fund 2 comes amid a changing landscape for class actions in Australia, with consumer actions overtaking securities actions as the leading type of funded claim, reflecting the development of effective legislation to hold large corporates to account. 

An innovative feature of the CASL Fund 2 offer is the ability of investors to elect a capital-protected allocation option with a discounted target return.

Key features of the offer include:

 CASL Fund 2: Up to $150m, Class A and Class B Units
 Class AClass B
Capital protectionYesNo
Fund term5 years
(2 years investment, 3 years harvest)
Hurdle rate per annum10%12%
Performance fee (after hurdle, fees and costs)40%25%
Management fee (% of capital commitment) per annum2%2%

Funds raised will be deployed only into new actions, with all existing funded matters funded by CASL Fund 1. No distinction will be made between Class A and B funds for the purposes of funding actions. 

An estimated $200m to $300m is deployed by litigation funders supporting legal claims in Australia, excluding law firms’ funding of actions from their own balance sheets. The most active sources of funding for Australian actions are based offshore and include hedge funds and specialist asset managers, many domiciled in tax-friendly jurisdictions such as the Cayman Islands and Channels Islands, attracted to Australia’s relatively receptive environment for group claims. 

CASL’s Fund 2 will be an Australian-domiciled unit trust. Bell Potter is lead manager for the CASL Fund 2 capital raise. 

Mr Price said: “Agility and responsiveness are important in selecting claims and bringing litigation – being based locally, CASL has the advantage of being able to move and make decisions quickly when required.” 

To coincide with the fundraise CASL announced that Ian Stone, former Group Managing Director and CEO of RAA, would join the Board of CASL’s Trustee entity CASL Funder Pty Limited. Tania Sulan, former Managing Director and Chief Investment Officer - Australia for Omni Bridgeway will also join the CASL Investment Committee. Visit www.casl.com.au for more information about CASL Fund 2.

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Announcements Commercial Deals

Almaden Announces Litigation Financing of up to $9.5 million

By Harry Moran |

Almaden Minerals Ltd. (“Almaden” or “the Company”; TSX: AMM; OTCQB: AAUAF) is pleased to announce that further to its press release of June 17, 2024, it has confirmed non-recourse litigation funding in the amount of up to US$9.5 million to pursue its international arbitration proceedings against the United Mexican States (“Mexico”) under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (“CPTPP”). The Company has also agreed with Almadex Minerals Ltd. (“Almadex”) to an extension to the maturity of its gold loan, and a litigation management agreement to help streamline corporate management of the arbitration process.

  • Non-recourse funding secured to pursue international arbitration proceedings against Mexico;
  • Globally leading counterparty validates quality of legal claims;
  • Gold loan maturity pushed out from March 31, 2026 to March 31, 2030;
  • Litigation Management Agreement streamlines corporate management of the arbitration proceedings to save money and time.

Litigation Financing

The Company has signed a litigation funding agreement (“LFA”) with a leading legal finance provider. The facility is available for immediate draw down for Almaden to pursue damages against Mexico under the CPTPP resulting from Mexico’s actions which blocked the development of the Ixtaca project and ultimately retroactively terminated the Company’s mineral concessions, causing the loss of the Company’s investments in Mexico.

The LFA provides funding which is expected to cover all legal, tribunal and external expert costs of the legal claims, as well as some corporate operating expenses as may be required. The funding is repayable in the event that a damages award is recovered from Mexico, with such repayment being a contingent entitlement to those damages.

The financing follows extensive due diligence by the finance provider. The financing size as well as the quality of the provider is testament to the strength of the Company’s legal claims against Mexico.

Gold Loan Amendment

The Company is also pleased to report that it has agreed with Almadex to extend the maturity of the gold loan (see press release of May 14, 2019) from March 31, 2026 to the earlier of March 31, 2030 or the receipt by Almaden or its subsidiary of any amount relating to its legal claims against Mexico.

In return for this amendment, in addition to its obligation to repay the gold loan, the Company has agreed to pay Almadex 2.0% of the gross amount of any damages award that Almaden may receive as a result of the legal claims, such repayment to be subordinate to amounts due under the LFA, and any additional legal and management fees.

Litigation Management Agreement

Finally, the Company has agreed with Almadex and its Mexican subsidiary to streamline the management of the arbitration proceedings by entering into a Litigation Management Agreement (“LMA”). Under the LMA, Almaden will bear the up-front costs of the arbitration and provide overall direction to the arbitration process for itself and its subsidiaries, as well as Almadex and its subsidiaries, with certain limitations. Almadex will remain a party to the arbitration and continue in its cooperation and support of the process. As noted above, Almaden has already secured litigation funding in the amount anticipated to be needed to fully prosecute the arbitration proceedings.

Should the arbitration proceedings result in an award of damages, the pro rata portion of those damages, if any, which may be attributable to Almadex from the 2.0% NSR royalty it held on the Ixtaca project will be determined. Almadex’s award will consist of this pro rata portion, less its pro rata share of the costs of pursuing the legal claims, including the financing costs (the “Almadex Award”). Almadex will compensate Almaden in the amount of 10% of the Almadex Award in exchange for managing the claim proceedings.

Safe Harbor Statement

Certain of the statements and information in this news release constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian provincial securities laws. All statements, other than statements of historical fact, are forward-looking statements or information. Forward-looking statements or information in this news release relate to, among other things, the total potential cost of the legal claims and the sufficiency of the money available under the LFA to cover these costs, the ability of the LMA to streamline corporate management of the legal claims, and the result and damages arising from the Company’s request for arbitration.

These forward-looking statements and information reflect the Company’s current views with respect to future events and are necessarily based upon a number of assumptions that, while considered reasonable by the Company, are inherently subject to significant legal, regulatory, business, operational and economic uncertainties and contingencies, and such uncertainty generally increases with longer-term forecasts and outlook. These assumptions include: stability and predictability in Mexico’s response to the arbitration process under the CPTPP; stability and predictability in the application of the CPTPP and arbitral decisions thereon; the ability to continue to finance the arbitration process, and continued respect for the rule of law in Mexico. The foregoing list of assumptions is not exhaustive.

The Company cautions the reader that forward-looking statements and information involve known and unknown risks, uncertainties and other factors that may cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements or information contained in this news release. Such risks and other factors include, among others, risks related to: the application of the CPTPP and arbitral decisions thereon; continued respect for the rule of law in Mexico; political risk in Mexico; crime and violence in Mexico; corruption in Mexico; uncertainty as to the outcome of arbitration; as well as those factors discussed the section entitled "Risk Factors" in Almaden's Annual Information Form and Almaden's latest Form 20-F on file with the United States Securities and Exchange Commission in Washington, D.C. Although the Company has attempted to identify important factors that could affect the Company and may cause actual actions, events or results to differ materially from those described in forward-looking statements or information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that our forward-looking statements or information will prove to be accurate. Accordingly, readers should not place undue reliance on forward-looking statements or information. Except as required by law, the Company does not assume any obligation to release publicly any revisions to on forward-looking statements or information contained in this news release to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

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