QUALCOMM Announces ICC Arbitration Decision
Regarding Royalty Dispute with ETRI
Business Editors/High-Tech Writers
SAN DIEGO--(BUSINESS WIRE)--Dec. 11, 2000--QUALCOMM Incorporated
(Nasdaq:QCOM) today announced that the International Court of
Arbitration (ICA) of the International Chamber of Commerce (ICC) has
issued its decision and award arising from the arbitration between
QUALCOMM and the Korean Electronics and Telecommunications Research
Institute (ETRI).
As a result of the award by the ICC, QUALCOMM will report, in its
first fiscal quarter of 2001 ending in December 2000, a one-time
charge of approximately $80 million for additional royalties to be
shared with ETRI as well as interest and other costs for the period
from inception of the Joint Development Agreement between the parties
in 1992 to September 27, 2000. In addition, the ICA ordered that
QUALCOMM continue to share with ETRI a part of the royalties that
QUALCOMM receives only on sales of certain Code Division Multiple
Access (CDMA) equipment for use in Korea. The continuing payments
ordered in the ICA decision are expected to have little impact, on the
order of $4 million per quarter depending on the sales of phones and
infrastructure in Korea, on the revenues and earnings of QUALCOMM in
future quarters.
"While we are disappointed by the ICA's decision, we continue to
look forward to receiving strong royalty revenues from sales of CDMA
equipment in Korea," said Louis M. Lupin, senior vice president and
general counsel of QUALCOMM. "The ICA's decision does not in any way
affect QUALCOMM's ability to collect royalties on CDMA, WCDMA or other
CDMA-based standards, and has no impact on the ability of QUALCOMM to
collect royalties from sales of CDMA equipment in Korea."
The Company is evaluating its options with respect to the award.
QUALCOMM Incorporated (www.qualcomm.com) is a leader in developing
and delivering innovative digital wireless communications products and
services based on the Company's CDMA digital technology. The Company's
business areas include integrated CDMA chipsets and system software;
technology licensing; Eudora(R) email software for Windows(R) and
Macintosh(R) computing platforms; digital cinema systems; and
satellite-based systems including portions of the Globalstar(TM)
system and wireless fleet management systems, OmniTRACS(R) and
OmniExpress(TM). QUALCOMM owns patents that are essential to all of
the CDMA wireless telecommunications standards that have been adopted
or proposed for adoption by standards-setting bodies worldwide.
QUALCOMM has licensed its essential CDMA patent portfolio to more than
90 telecommunications equipment manufacturers worldwide. Headquartered
in San Diego, Calif., QUALCOMM is included in the S&P 500 Index and is
a 2000 FORTUNE 500(R) company traded on The Nasdaq Stock Market(R)
under the ticker symbol QCOM.
Except for the historical information contained herein, this news
release contains forward-looking statements that are subject to risks
and uncertainties, including the Company's ability to successfully
design and have manufactured significant quantities of CDMA components
on a timely and profitable basis, the extent and speed to which CDMA
is deployed, change in economic conditions of the various markets the
Company serves, as well as the other risks detailed from time to time
in the Company's SEC reports, including the report on Form 10-K for
the year ended September 24, 2000, and most recent Form 10-Q.
QUALCOMM, OmniTRACS and Eudora are registered trademarks and
OmniExpress is a trademark of QUALCOMM Incorporated. Globalstar is a
trademark of Loral QUALCOMM Satellite Services, Incorporated. Windows
is a registered trademark of Microsoft Corp. Macintosh is a registered
trademark of Apple Computer Inc. All other trademarks are the property
of their respective owners.
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CONTACT: QUALCOMM Incorporated
Christine Trimble, Corporate Public Relations
858/651-3628, Fax 858/651-2590
ctrimble@qualcomm.com
or
Julie Cunningham, Investor Relations
858/658-4224, Fax 858/651-9303
jcunningham@qualcomm.com |
