Business Context and Reporting Period
InterDigital, Inc. filed a Form 8-K Current Report on January 30, 2009, regarding the termination of a material definitive agreement. The company is incorporated in Pennsylvania and operates primarily in the patent licensing sector.
Key Financial Metrics
This filing does not provide specific financial data such as revenue, profit, cash flow, margins, debt, or liquidity. The report focuses exclusively on a contractual event rather than financial performance metrics.
Material Changes
The primary material change reported is the termination of the "1996 Agreement," a patent license agreement between InterDigital Technology Corporation and Samsung Electronics Co., Ltd. dated January 22, 1996. Key details include:
- Agreement Scope: The terminated agreement granted Samsung a non-exclusive, worldwide, royalty-bearing, perpetual license for 2G single-mode TDMA-based products.
- Most Favored Licensee Clause: The 1996 agreement included a clause reducing Samsung's royalty obligations if a third party secured a lower royalty rate for similar products.
- Termination Trigger: The termination occurred on January 30, 2009, pursuant to a new patent license agreement effective November 24, 2008, and entered into on January 14, 2009, between InterDigital Communications, LLC (a wholly-owned subsidiary) and Samsung.
Guidance, Outlook, and Risks
The filing does not contain forward-looking guidance, management commentary on future outlook, or specific risk factors beyond the context of the agreement termination. No unusual items or contingencies were disclosed in this specific report.
Investor Verification Checklist
- Verify the financial impact of replacing the 1996 perpetual license with the new 2008/2009 agreement terms.
- Confirm the specific royalty rates and duration of the new agreement entered into on January 14, 2009.
- Assess whether the termination of the "most favored licensee" clause affects royalty obligations for other licensees.
- Review subsequent filings for any litigation or disputes arising from the transition between the two agreements.