KING OF PRUSSIA, Pa. -(Dow Jones)- InterDigital Communications Corp. (IDCC) said an arbitration panel has ruled that Nokia Corp. (NOK) should pay the company between $232 million and $252 million in royalty obligations.
In a press release Friday, InterDigital said it expects to recognize revenue from this final award.
The arbitration took place to determine Nokia's royalty obligations under an agreement with Interdigital.
Nokia had requested arbitration in connection with its royalties for its sales of some products under a patent license agreement with an Interdigital unit.
In after-hours trading, InterDigital's shares rose $3.94, or 22%, to $21.44, according to Inet.
The arbitration took place in the International Court of Arbitration of the International Chamber of Commerce.
Based on the royalty rates established by the arbitration tribunal, InterDigital estimates that Nokia's royalty obligations for infrastructure and handset sales from Jan. 1, 2002, through Dec. 31, 2003, will be about $112 million.
In addition, InterDigital estimates that Nokia's royalty obligations for infrastructure and handset sales for the period Jan. 1, 2004, through Dec. 31, 2006, will be in the range of $120 million to $140 million. The amount of that payment depends on whether Nokia chooses a prepayment option.
The above amounts are exclusive of awarded interest, net of any applicable contractual discount and based on Nokia achieving sales volume that entitles Nokia to obtain the lowest applicable royalty rate.
In 2004, Interdigital posted revenue of $103.7 million.
InterDigital will host a conference call at 8 a.m. EDT Tuesday concerning the award and its impact on the company.
-Anjali Cordeiro; Dow Jones Newswires; 201-938-5400; AskNewswires@dowjones.com
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Posted to the site on 2nd July 2005
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