Akiaki, I'll try to offer some ideas on estimating a number. This is a bit of a WAG (Wild Assumed Guess) I'm presenting, but it might help you to do your own estimate.
First, GOOG was in deep trouble in 2010 because of it's poor video performance with YouTube and other products. Their miraculous improvement (mysteriously at the same time they were working with VSL) was a major part of pumping up their revenues and stock value every year since. I think it's something like five times the value now. While there were other factors involved in GOOG's growth, I think the impact could have been over a $ billion, plus whatever license fees they've pulled in since.
The Engineered Architecture side is potentially more significant. For whatever reason, GOOG's own people estimated a value of the technology at $120 BILLION ANNUALLY. I don't know if their coffee had been spiked that day, but I can see how there would be a significant income potential as a result of the intial software purchase, tied to annual license use fees and recurring updates revenues.
MAXD gets only a portion of any settlement; the legal firms and the founders of VSL and Engineered Architecture get a share. I know the share amounts are on the MAXD 10-Q reports somewhere, and you can look that up. Here, for the sake of convenience, I'm going to split any award as one third legal firms, one third VSL/EA, and one third MAXD.
I'll use a $1 billion dollar settlement/award as a base. That would give MAXD $333 million. Let's give $33 million to zero MAXD debt. The remaining $300 million would give MAXD a cash value(PRE-TAX) of $0.75 per share (based on 400 million shares. Keep in mind the recent preferred share conversion reverse split of 9-1 skewed the total shares number, but assuming a pre reverse split volume, it was getting close to 400 million, so that's why I use this number.) The $0.75 value would be just for the settlement result, and would not include the core MAXD technology sales and growth potential. The share value on the market could actually be higher.
So that's kind of a way to guesstimate a number. A $3 billion settlement would be around $2.25 share value, a $333 million settlement would be around $0.25 share value, etc.
Also, something I think worth noting; the recent preferred share conversion was odd. The only purpose I see in it is that it provides the holders of those preferred shares as much as 70% of dividends tax free. That's obviously huge, and I don't know where the loophole comes from, but it is real. Given that, I can see a motivation to immediately distribute a dividend from any settlement proceeds. Any dividends must be issued to all shareholders; preferred holders can not limit dividends to themselves. My point here is that there may be an immediate dividend opportunity for investors. This is something better reviewed by an expert on preferred shares, but I wanted to make you aware of it.
My personal fantasy is that GOOG will just flat out purchase the MAXD technology and the lawsuits for, say, $5 billion. Then I can cash out and move on. Who knows?
Any other thoughts on a settlement value are welcome; please post if you have any.
