SOURCE: Marathon Patent Group

Marathon Patent Group

January 06, 2016 08:45 ET

Marathon Patent Group and Uniloc Provide Update on Proposed Merger

LOS ANGELES, CA--(Marketwired - Jan 6, 2016) - Marathon Patent Group, Inc. (NASDAQ: MARA) ("Marathon" or "Company"), a patent licensing company, and Uniloc Luxembourg S.A. ("Uniloc"), provided today an update on their previously announced proposed merger.

On August 14, 2015, Marathon Patent Group, Inc. and Uniloc announced that they had entered into a definitive business combination agreement, (the "Agreement") according to which the companies will be combined in an all-stock transaction intended to qualify as a tax-free reorganization. The new company will be called Marathon Group SA. (the "New Company").

The New Company's combined assets under management will be balanced between patents purchased from third parties and patents internally developed. The New Company will begin with a current portfolio of approximately 624 patent assets. These patents cover products and methods in the automotive, medical device, software, identity management, device authentication, mobile communication and Internet fields of use.

At the time of the signed definitive Agreement, the combined entity's value proposition included the following:

  • Industry leading management team with proven track record
  • Highly scalable business model with significant operating leverage
  • $93.6 million pro forma combined licensing revenue over last 30 months of operations (unaudited)
  • $37.5 million pro forma combined licensing revenue over trailing twelve months of operations (unaudited)
  • 119 active defendants and 101 trials projected through 2017
  • Up to 150 additional potential licensees
  • Large, diversified and active patent portfolio
  • Scale and diversification potentially eliminates dependence on large, binary licensing or litigation outcomes
  • Gross margin improvement potential on future cases expected from economies of scale and Uniloc's relationship with law firms that work on a contingency fee basis

In connection with the proposed merger, Marathon previously announced its intent to file a registration statement on Form S-4 with the Securities and Exchange Commission. The filing of the S-4 has been delayed pending availability of the required historical audited financial statements for Uniloc. Although Uniloc's Luxembourg statutory audit has been completed by Uniloc's auditor, the Luxembourg office of Ernst & Young, certain additional actions must be taken in order for Uniloc's financial statements to be in a format suitable for filing with the Form S-4. Marathon expects the S-4 filing will be made promptly upon receipt of such audited financial statements. The parties expect the filing to be made as early as practicable in the first quarter of 2016.

About Marathon Patent Group:

Marathon is a patent acquisition and monetization company. The Company acquires patents from a wide-range of patent holders from individual inventors to Fortune 500 companies. Marathon's strategy of acquiring patents that cover a wide-range of subject matter allows the Company to achieve diversity within its patent asset portfolio. Marathon generates revenue with its diversified portfolio through actively managed concurrent patent rights enforcement campaigns. This approach is expected to result in a long-term, diversified revenue stream. To learn more about Marathon Patent Group, visit www.marathonpg.com.

About Uniloc:

Uniloc is an intellectual property company which has invented and owns a foundational patent portfolio in information security that targets large end markets where information security is critical. In addition to its invented patent portfolio, Uniloc also develops and acquires IP which it monetizes through global licensing and active enforcement campaigns. The company has developed a proprietary technology platform which enables it to cost effectively develop and prosecute patents; identify and acquire new high-value patent assets; and manage multiple, simultaneous licensing and enforcement campaigns with the potential to generate revenue faster than competitors at much higher margins. Uniloc won the fifth largest jury verdict in history at the time against a large, global software provider.

Safe Harbor Statement:

Certain statements in this press release constitute "forward-looking statements" within the meaning of the federal securities laws. Words such as "may," "might," "will," "should," "believe," "expect," "anticipate," "estimate," "continue," "predict," "forecast," "project," "plan," "intend" or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to us on the date of this release. These forward looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including without limitation those set forth in the company's filings with the Securities and Exchange Commission (the "SEC"), not limited to Risk Factors relating to its patent business contained therein and the timing of filing of the Form S-4 and the expected consummation of the business combination. Thus, actual results could be materially different. The Company expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law.

No Offer or Solicitation:

This communication is for informational purposes only and is neither an offer to purchase, nor a solicitation of an offer to sell, subscribe for or buy any securities or the solicitation of any vote in any jurisdiction pursuant to the proposed transactions or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.

Additional Information and Where to Find It:

In connection with the proposed transaction, a registration statement on Form S-4 will be filed with the SEC. YOU ARE ENCOURAGED TO READ THE REGISTRATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE PROXY STATEMENT-PROSPECTUS THAT WILL BE PART OF THE REGISTRATION STATEMENT, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE BUSINESS COMBINATION. The final proxy statement-prospectus will be mailed to shareholders of Marathon and shareholders of Uniloc. Investors and security holders will be able to obtain the proxy statement-prospectus and other documents free of charge at the SEC's web site, www.sec.gov, or download them from www.marathonpg.com/investors.

Participants In The Solicitation:

Marathon, Uniloc and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the business combination. Information concerning Marathon's participants is set forth in the proxy statement dated, July 2, 2015, for Marathon's 2015 annual meeting of stockholders as filed with the SEC on Schedule 14A. Messrs. Etchegoyen and Turner beneficially own 21% and 2%, respectively, of the fully diluted shares of Uniloc Luxembourg SA. Their address is c/o Uniloc USA, Inc., 7160 Dallas Parkway, Plano, Texas 75024. Additional information in respect of the merger will be included in the registration statement and proxy statement-prospectus to be filed with the SEC.

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