So to be clear, you are suggesting that PTSC spent $394,000 on Legal Fees. . This seems acturate based on the filing.
However, you are further suggesting that of that $394K, there were "leftover" substantial legale fees paid that could have gone to the negotiation and consumation of the agreement with TPL as per YOUR emphasis added in support of administrative and strategic changes for our Company" suggest that this language would leave that open.
Assuming your are correct, based on the next sentence, which you left out, that would have left $23,000 for such expenditures for outside counsel review as you suggest that would be "in support of administrative and strategic changes for our Company" because PTSC goes on to clarify "Legal expenses amounting to approximately $371,000, were incurred by our attorneys and recognized as expenses by us in the fiscal year ended May 31, 2005 in connection with intellectual property enforcement efforts."
It seems clear that, in their language, PTSC differentiates between "intellectual property enforcement efforts", such as licensing, and prosectution of infringers, and "adminstrative and strategic changes" such as shuffling of managment and BOD positions/titles, and a change in strategic direction by dropping litigation and partnering with your former adversary.
Considering that FY2005 was the year that AMD was signed up, which was a $3.5M deal that also included royalty fees on tech outside the MMP, which makes it presumably more complicated than the typical MMP deal, and considering $371K would amount to slightly over 10% of the AMD deal, which is well within the range of the typical legal fees we're experiencing with MMP licensing, it doesn't seem to pass the smell test that the $394K spent included any "leftover" substantial legal fees to have gone towards such a monumental agreement, one that should have been reviewed not only for compliance with all SEC requirements including Reg FD and the like, but also by someone with expertise and focus on M&A specialty issues. Rather, it's seems likely that those other $23K went toward settling with Wallin and crew, and instituting Pohl and crew, and dotting the i's and crossing the t's with respect to such "administrative and strategic changes", wouldn't you agree?
Furthermore, if that's the case, what "efforts" exactly were Pohl, Johnson, Felcyn and Falk being compensated to the tune of $170K for 3 months of effort? They are clearly efforts in the consumation of the transaction with TPL. Did they throw some cocktail parties to schmooze DL & ML? Did they take Wallin on a trip to help him see the light in the new direction they envisioned and that he should leave? In all seriousness, considering PTSC is quite specific about the expenditures of their legal fees, even to the point where they mention the law firm who previously represented them was now suing them at that time, I think it's pretty disingenous to think they would specify those costs, specify the BOD payments for the consumation of the agreement, and somehow leave it ambiguous about what they spent for legal representation for the BIGGEST MOST IMPORTANT deal they ever made.
