SACRAMENTO, CA--(Marketwire -01/10/12)- Internet Patents Corporation (NASDAQ: PTNT), formerly InsWeb Corporation (NASDAQ: INSW - News), today announced that its Board of Directors has declared a special cash distribution of $5.00 per share on the Company's common stock, for a total distribution payment of approximately $33 million based on the current shares outstanding.
"We are pleased to announce the special distribution for our shareholders. We have begun the operation of our new intellectual property-focused company and are excited by the licensing opportunities that we believe are available to us based on our strong portfolio of e-commerce and online insurance distribution patents," said Hussein Enan, Chairman and CEO of Internet Patents Corporation.
Special Distribution Information
The special distribution will be payable to shareholders of record as of February 10, 2012 and will be paid on March 9, 2012. As of January 4, 2012, the Company had 6,608,967 shares of its common stock outstanding and 1,403,027 in outstanding and exercisable options. The special distribution follows the acquisition of substantially all of the assets of InsWeb Corporation relating to its insurance lead generation and marketing business by Bankrate, Inc., via a transaction that closed on December 21, 2011. The Board made a determination regarding the size of the distribution based on its current assessment of the working capital needs in connection with the development and operation of the Company's new Patent Licensing Business, among other factors. The distributions made in the 2012 fiscal year will be treated as dividends to the extent of the Company's current earnings and profits for the 2012 fiscal year for U.S. federal income tax purposes. To the extent the distributions made in the 2012 fiscal year exceed the Company's current earnings and profits, the distributions will constitute a return of capital to the extent of the shareholder's tax basis and then will be treated as gain from the sale of the common stock. The Company will provide further direction on the potential tax treatment of the distribution for U.S. federal income tax purposes.
In addition, the Board plans to evaluate the potential to make another special cash distribution to its stockholders pending the determination of several items related to the Bankrate transaction including a working capital adjustment and transaction-related expenses, as well as the outcome of the Company's efforts to further optimize its ongoing expense structure.
Internet Patents Corporation Information
Internet Patents Corporation is retaining a portfolio of e-commerce and online insurance distribution patents and will focus on a new business model in which it expects to license its patented technologies. The Company believes its intellectual property comprises valuable technologies for a wide range of e-commerce companies and is in the process of developing its go-forward strategy geared towards monetizing its patent portfolio. The Company has not been previously engaged in the Patent Licensing Business and expects no significant revenues from this business in the near future. At the same time, the Company is actively engaged in modifying its expense structure to align with its go-forward operations.
The Company also announced the completion of its name change process by formally amending its articles of incorporation to replace "InsWeb Corporation" with "Internet Patents Corporation." The Company, which began operating under the new name on December 21, 2011, has also been assigned a new ticker symbol: PTNT. The new ticker symbol, which replaces the symbol INSW, becomes effective with the opening of trading on January 11, 2012. The company is traded on the NASDAQ Capital Market.
This news release contains forward-looking statements, which include statements expressing the intent, belief or current expectations of Internet Patents Corporation that are subject to significant risks and uncertainties and are subject to change based on various factors, many of which are beyond our control. The words "may," "could," "should," "would," "believe," "anticipate," "estimate," "expect," "intend," "plan," "target," "goal," and similar expressions are intended to identify forward-looking statements. Actual results might differ materially from those stated or implied by such forward-looking statements due to risks and uncertainties associated with Internet Patent Corporation's business, which include, but are not limited to: the unpredictable nature of patent licensing; potential changes in the laws and regulations relating to patents; the risk that we are not currently engaged in the patent licensing business, and our patent portfolio has never generated revenues; future changes we may make in our patent licensing strategy; and changes in the taxation of distributions to shareholders due to current year earnings. Unless legally required, Internet Patents Corporation undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.