InterDigital Inc (IDCC)

[F6]

Corp_Buyer -- IDCC has not disclosed the voting rights of the poison pill stock, and my recollection is that when asked a company representative made clear the company had no intention of making that disclosure (at least not unless/until the pill were triggered), so as to keep any potential hostile bidder in the dark as to just what it might/would be up against if it did trigger the pill (highly likely imo that the BOD retains the ability to determine the voting rights attributes of the poison pill stock at the time of such a trigger) -- and I strongly agree (as I have posted a number of times in the past few years) that the class voting rights you and I both surmise could/would be there would be an extremely strategic point, as such class voting rights would categorically enable the poison pill stock to block that final cram-down merger that would inevitably have to be the final step in a hostile takeover (not to mention the voting rights such poison pill stock might have in terms of elections of directors . . .)

the classified BOD is crucial because it serves to make sure a potential hostile bidder can't just instead do an end run around the poison pill, at least not via, or within the time frame of, just one ASM -- such an end run around the poison pill proceeding as follows: the bidder would stop its accumulation of IDCC shares JUST under the poison pill theshhold (and for that matter it might even elect to stay under the 13d/13g 5% filing threshhold); then it would conduct a good old-fashioned proxy contest to try to get ITS slate for (at least a majority of the positions on) the BOD elected; then once that new BOD (a majority of which is) of ITS choosing is in place, the bidder would submit a 'friendly' offer to the (ITS) new BOD, which 'friendly' offer said new BOD would of course then accept, so that the poison pill actually would never even be triggered (and, accordingly, among other things, the poison pill shares would never exist to vote separately as a class on that final cram-down merger) . . . so long as we retain the classified BOD, such a 'proxy war' approach would have to continue, would have to be sustained, through (at least) two ASMs -- which among other things would give the company that much more time, (at least) one more full year, to increase the share price by progress toward its fundamental 2G/3G licensing goals (as well as toward other goals such as chips and licensing other standards), which in turn could/would potentially enormously increase the cost to the bidder for all the shares from and beyond the poison pill ownership threshhold that it would ultimately acquire even with such a 'friendly' BOD, given that any 'friendly' offer accepted by such a 'friendly' BOD would have to at least match the current share price at the time such 'friendly' offer were finally able to be thus made and accepted -- a VERY potent disincentive to attempting a takeover via such a 'proxy war' approach, IN PARTICULAR in the case of IDCC . . .

I submit we all should be concerned re a potential hostile takeover ('hostile' of course understood to include any 'end run around the poison pill' takeover via proxy contest effected as described in the foregoing paragraph) for so long as IDCC's share price continues to be so far below what it will be once the 2G and 3G licensing battles are resolved (and those battles WILL be resolved -- and even if the ultimate royalty rates are less than, even say half of, the c. 0.5% for 2g handsets/devices that we're apparently getting from Sony-Ericsson and the c. 1% for 3g that it seems reasonable we can generally hope for [thanks Data_Rox], IDCC's share price will still be MUCH higher than it is now [I would think somewhere well north of 50, anyway] -- that very background reality of course being THE very reason IDCC is so clearly and so much at risk for such a potential hostile takeover) (. . .)

hope the foregoing (terribly rambling, I know -- sorry, in a hurry) helps explain why I think it is so important that we retain the classified BOD, at least for now -- and who knows, once IDCC has nailed down all these 2G and 3G licensing battles, and its share price reflects those resolutions, I might even be happy to join you in supporting getting rid of the classified BOD; but not until then

take care