XpresSpa Group Inc (XSPA)

[PennyPincher12]

so $696mil X 3 = $2.088 billion dollars if the jury sides with Vringo in the case (willful infringement..triple damages).

Assuming a .5% royalty for the next 4 years, based on previous numbers of $67 billion in revs from Google as of 2001 (10 years, 6.7 billion a year on average). .5% on $6.7 billion a year is $33,500,000 X 4 = $134,000,000. Vringo will probably want their damages in the settlement ($700 million ish) + the $134,000,000 over the next 4 years. Out of that $700 mil, Vringo gets 80% (lawyers get 20%) so we're looking at a true-ish value, based on my estimate, of $694,000,000.

On share value alone (91mil shares), that represents a $7.62 per share value. Add that to today's current price of $3.25 and we're looking at $11 before any multiple is applied. I am still of the opinion that Google will settle out of court before the trial begins, probably the weekend before. Vringo could also end up settling for a bit less if they thought Google would cave more quickly, so I see Vringo's settlement range at this point being $500-700 million. At the low end ($500mil), the math still points to Vringo getting $535mil or so ($5.88/share). Apply a 2x multiple to either of these outcomes (before adding in current share value) and I'm looking at $15-$18.5 as a settlement range for Vringo. This is all just my opinion.

PS: James Altucher referenced VHC's win over Microsoft in his Sept 4th article on SA - he recalled that VHC obtained a 10x multiple when they beat Microsoft. So I think a 2x multiple is very low but I want to keep things realistic. I'm with James - if we get a 10x multiple on a huge settlement, I might die of a heart attack too lol.