Here is the Litigation Breakdown:
Everyone can figure out what GDSI gets which is in Exhibit 10.55 which is written in legaleze but here is the breakdown. You can refer to the paragraphs that I am siting to which is right there.
Schdule 1 is on Page 7.
It says All 100% of the litigation proceeds distributed to seller/client pursuant to section 3Ai. (THE SELLER IS GDSI IN CASE YOU'RE WONDERING.
All of the litigation proceeds distributable to seller/client under 3Aii of the agreement until the buyer receives what it paid out (MEANS TO GDSI WHICH MEANS THE 1,200,000 IF ALL PAID PLUS WHAT IT PAID TO LAW FIRM) and then the buyer receives 27.5% or only 25.5% if the lawsuit survives a motion to dismiss.
Follow so far.
SECTION 3Aii OF THE CONTRACT IS THE KEY
The 3Ai says the buyer gets what they paid (means what they gave GDSI and law firm)
Here is the key:
The litigation proceeds shall be distributed to law firm and client with the less of x equal to the applicable percent (means either 25.5% or 27.5% and NOW here is the key.
IT SAYS
43% of litigation proceeds, allocated to law firm (MEANS THAT LAW FIRM GETS THEIR FEES PLUS 43%, and the remaining portion allocated to client (MEANS GDSI)
So here is the summary.
IF investor pays 4,000,000 to GDSI and law firm, they get that back first if the law suit is won. Then they either get 27.5% or 25.5% and law firm gets 43%.
Which means that if there is judgment of $50,000,000, here is the breakdown
50000000 - 4000000 = 46,000,000
Investor gets lets just say 27.5% of 46,000,000 which is $12,650,000.
Now there is 33,350,000 left.
Law firm gets 43 % of that which is $14,340,500.
There is 19,010,000 left.
Gets who gets that GDSI.
Read the agreement and you'll see my math is sound
