Exhibit 99.1
InterDigital Receives Final Award in Arbitration
Proceeding with Nokia Corporation
KING OF PRUSSIA, Pa.--(BUSINESS WIRE)--July 1, 2005--InterDigital
Communications Corporation (Nasdaq:IDCC), a leading designer,
developer and provider of wireless technology and product platforms,
today announced that the Arbitral Tribunal operating under the
auspices of the International Court of Arbitration of the
International Chamber of Commerce (ICC) has delivered its Final Award
in the arbitration proceeding between InterDigital Communications
Corporation, InterDigital Technology Corporation (ITC), one of the
company's wholly-owned subsidiaries, and Nokia Corporation (Nokia).
The Tribunal has established royalty rates which are applicable to
Nokia's sales of covered products for the period beginning January 1,
2002 through December 31, 2006 and reflect Nokia's leading market
position. Based on the royalty rates established by the Tribunal,
InterDigital estimates that Nokia's royalty obligations for covered
infrastructure and handset sales from January 1, 2002 through December
31, 2003 will be approximately $112 million. In addition, InterDigital
estimates that royalty obligations for covered infrastructure and
handset sales for the period January 1, 2004 through December 31, 2006
will be in the range of $120 million to $140 million depending upon
whether Nokia avails itself of a prepayment option for the eighteen
month period from July 1, 2005 through December 31, 2006. 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. Estimates
of post-2003 royalty obligations are based on third party and
InterDigital's estimates of Nokia's sales of covered products for the
applicable periods and InterDigital's assumptions as to market
forecasts and Nokia's sales mix, selling prices and market share.
The Final Award relates to Nokia's royalty obligations on its
worldwide sales of 2G GSM/TDMA and 2.5G GSM/GPRS/EDGE products under
its existing patent license agreement with ITC. The company expects to
recognize revenue associated with the Final Award after all criteria
for revenue recognition have been met.
"We are pleased with the Tribunal's decision," said Harry G.
Campagna, InterDigital's Chairman of the Board. "I would like to thank
the many talented people both inside InterDigital and outside the
company who remained steadfast in their resolve and tireless in their
support of this effort."
William J. Merritt, InterDigital's President and Chief Executive
Officer, added, "While Nokia maintained a very aggressive position in
this matter, we are hopeful that Nokia will comply with its
contractual requirements and pay past and future amounts owed.
Nonetheless, to enforce the ICC's decision, today we filed an action
against Nokia in the U.S. District Court for the Southern District of
New York."
InterDigital continues to be a party to an arbitration proceeding
with Samsung Electronics Co., Ltd. (Samsung) with the evidentiary
hearing scheduled to commence in October 2005. In 2002, Samsung
exercised its most favored licensee rights under its patent license
agreement with InterDigital and elected to have its royalty
obligations be defined by the terms of the Nokia Patent License
Agreement. The company is currently reviewing the impact of the Final
Award on the Samsung patent license agreement, but believes that it
should have a significant impact on Samsung's royalty obligations.
InterDigital will host a conference call on Tuesday, July 5, 2005
at 8:00 a.m. Eastern Daylight Time, to discuss the Final Award and its
impact on the Company. To access the conference call within the U.S.,
please dial 1-800-289-0569. International participants may access the
call by dialing 1-913-981-5542. Please dial in to the call by 7:50
a.m. Eastern Daylight Time on July 5, 2005 and ask the operator for
the InterDigital conference call.
InterDigital also will provide access to the call on its web site
at: www.interdigital.com. The company encourages participants to take
advantage of the Internet option if possible. For the Internet
broadcast, click on the microphone icon next to "Live Web Cast" on the
Home Page and you will link to the web cast. In preparation for the
web cast, InterDigital recommends that you complete the Pre-Event
System Test.
In addition, a replay of the conference call will be available for
one week after completion of the call. To access the recorded replay,
dial 1-888-203-1112 and use the confirmation code 1690544.
International participants may access the replay by dialing
1-719-457-0820 and using the confirmation code 1690544. A replay of
the conference call also will be available on the company's web site.
About InterDigital
InterDigital designs, develops and provides advanced wireless
technologies and products that drive voice and data communications.
The company offers technology and product solutions for wireless
applications that deliver time-to-market, performance and cost
benefits, as well as product differentiation advantages to its
commercial and government/military customers. InterDigital has a
strong portfolio of patented technologies covering 2G, 2.5G, 3G and
802 standards, which it licenses worldwide. For more information,
please visit InterDigital's web site: www.interdigital.com.
InterDigital is a registered trademark of InterDigital Communications
Corporation.
This press release contains forward-looking statements regarding
our current beliefs, plans, and expectations as to the receipt, amount
and calculation of past and future royalty obligations of Nokia under
the Final Award, and the effect of the Final Award on the royalty
obligations under the Samsung patent license agreement. Words such as
"believe", "expect", "may", "could" or similar expressions are
intended to identify such forward-looking statements.
Forward-looking statements are subject to risks and uncertainties,
and actual outcomes could differ materially from those expressed in or
anticipated by such forward-looking statements due to a variety of
factors including, without limitation, those contained herein and: (i)
InterDigital's interpretation of and Nokia's compliance with the Final
Award; (ii) adjustments in the estimated and actual amounts of sales
of Nokia covered products derived from InterDigital or third party
data or assumptions, or inaccuracies in sales figures supplied during
the Nokia arbitration; (iii) the company's application of an available
prepayment option; (iv) unanticipated results in enforcement
proceedings relating to the Final Award; and (v) application of the
terms of the Final Award to the Samsung patent license. InterDigital
undertakes no duty to update any forward-looking statements, whether
as a result of new information, future events or otherwise.
CONTACT: InterDigital Communications Corporation
Janet Point, 610-878-7800
janet.point@interdigital.com