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Investor Presentation Overview - Canaccord Genuity 32nd Annual Growth Conference
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Corporate Overview
Jim Skippen, President & CEO Canaccord Genuity 32nd Annual Growth Conference August 15, 2012
Safe Harbour
Certain statements in this presentation, other than statements of historical fact, may include forward-looking information that involves various risks and uncertainties that face the Company; such statements may contain such words as “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions, and may be based on management’s current assumptions and expectations related to all aspects of the wireless and wireline telecommunications industries and the global economy. There can be no assurance that any statements of forward-looking information contained in this document will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral statements containing forward-looking information are based on the estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. Except as required by applicable laws, the Company assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change. Readers are cautioned not to place undue reliance on any statements of forward-looking information that speak only as of the date of this release. Additional information identifying risks and uncertainties relating to the Company’s business are contained under the heading “Risk Factors” in WiLAN’s current Annual Information Form and its other filings with the various Canadian securities regulators which are available online at www.sedar.com.
Unless otherwise noted, all dollar amounts are in United States currency.
August 15, 2012 2
WiLAN
August 15, 2012
• Leader in IP licensing
• TSX (WIN) and NASDAQ (WILN) listed
• S&P/TSX Composite and Dividend Indexes
TSX: WIN
Recent Share Price * CDN $4.96
Market Capitalization * CDN $590M
Total Shareholder Return since 2006 550%
Cash $191M
Long-term Debt $0
Annual Dividend CDN $0.14 * Canadian Dollars
3
Investment Highlights
August 15, 2012
Compelling Growth Opportunities
Experienced Management Team with a Proven Track Record of Success
4
Diversified and High-Margin Recurring Subscription Business Model
Large, Attractive and Untapped Market Opportunity
Strong Financial Performance and Well Capitalized
Large Corporations Actively Monetizing Patents
August 15, 2012
$4.5 Billion
Nortel Patent Sale – July 2011
$12.5 Billion
Google / Motorola Acquisition – August 2011
AOL / Microsoft / Facebook Sale – April 2012
$1.1 Billion
800 Patents
Samsung / Microsoft – September 2011
Royalties paid for all Android phones
Estimated $5-10 per handset
Pursuing Monetization Strategies
Over 17,000 patents
$550 Million 650 Patents sold,
300 licensed
5
Annual U.S. Patent Licensing Revenue: $500B *
August 15, 2012
40% 60%
99%
Patent Ownership Revenues Generated 1%
Large corporations
Small companies, individual inventors, universities and research labs
* Sources: Deloitte, Intellectual Asset Management, July 2009, http://www.deloitte.com; Acacia Research; Intellectual Ventures
…BUT LARGEST OWNERSHIP GROUP IS NOT GENERATING FAIR SHARE OF REVENUES
6
Business Model
August 15, 2012
P A T E N T L I C E N S I N G P A T E N T
A G G R E G A T O R
• Heavy R&D investment • Owned patents
• Zero R&D investment • Partner owned patents
• Modest R&D investment • Owned and partner
patents
7
Diversified Business
August 15, 2012
G L A D I O S License partner owned patents
C O R E License owned patents
Recurring subscription model
Ownership Partnership
R E V E N U E
8
Wireless Access
TV and Digital Display
Cloud Computing
3,000 patents, 250 essential 7 partnerships
Large, Untapped Market Opportunity
August 15, 2012
Wi-Fi, DSL, Bluetooth
TV and Display
Handsets
Cellular Infrastructure
Cloud Computing
$80B
$920B
$250B
$140B
* Estimated using market research data from various sources including Display Search, Dell’Oro, Strategy Analytics, IDC, WiLAN
$40B
Over $1.5 Trillion
Unlicensed Global Equipment Market 5 Years *
9
Gladios
$100B
Portfolio Growth
20 270 300
750 970
3,000+
2006 2007 2008 2009 2010 2011
CORE PATENTS Number of Issued and Pending Patents
WHERE DO OUR PATENTS
COME FROM? • R&D • Acquisitions
• Inbound inquiries • Brokers and
investment bankers • Proactive
identification
10 August 15, 2012
Licensing Success
August 15, 2012
COMPANIES LICENSED AGREEMENTS WORTH 100’s OF $MILLIONS 260+
Agreement Types
80% 20%
Fixed Payments Running Royalties
4+ Years of Revenue Backlog
11
Strong Track Record of Revenue Growth
August 15, 2012
ANNUAL REVENUE INCREASE
1 Cash Revenues
OVER $100M IN 5 YEARS
2006 2007 2008 2009 2010 2011 2005
$1.9M
$17.5M $25.9M
$30.6M
$49.2M
$105.8M
$0
1
12
115% INCREASE
Litigation Catalysts
August 15, 2012
Case Companies Recent Events Upcoming Events
3GPP
Markman Order • Believe constructions
enable demonstration of infringement
• All 10 of defendants’ constructions rejected
Trial – April 2013
Handset 2 Markman Hearing – February 2013 Trial – March 2014
HTC Markman Hearing – February 2013 Trial – August 2013
RIM Trial – February 2014
LG USPTO validated all claims in V-Chip patent, allowed 30 new claims
Appeal Hearing – Q4 2012 (estimated)
13
World-Class Team
August 15, 2012
Michael Vladescu COO
Shaun McEwan CFO
Paul Lerner Senior Legal
Counsel
Dan Henry VP Business Development
Jim Skippen CEO
Education and Designations *
Engineers 32
Masters/PhDs 27
Lawyers 9
MBAs 3
Patent Agents 6
Accountants 2 * Indicates number of employees with given education/designation,
not number of employees serving in specific role
14
ANALYSTS TSX: WIN NASD: WILN
Public Market Presence
August 15, 2012
Analyst Rating
Byron Capital Markets Buy
Canaccord Genuity Buy
CIBC World Markets Sector Outperform
Clarus Securities Buy
Craig-Hallum Capital Buy
Davenport & Co. Buy
Fraser Mackenzie Strong Buy
Northland Capital Sector Outperform
Paradigm Capital Buy
Versant Partners Buy
All Recommend “Buy”
15
Conclusion
August 15, 2012
Value + Growth
16
Just beginning to realize business potential
August 15, 2012
APPENDIX
17
August 15, 2012
Key Litigations
COURT: Texas 3GPP Case
HSPA
Defendants
Technology
2012 2013
Markman – April 2012
Trial – April 2013
Mediation
18
Key Litigations
August 15, 2012
Wi-Fi, CDMA
Defendant
Technologies
2012 2013
Markman – February 2013
Trial – August 2013
HTC Case COURT: Texas
19
August 15, 2012
Key Litigations
Wi-Fi, CDMA
2012 2013 2014
Markman – February 2013
Trial – March 2014
COURT: Texas Handset2 Case
Defendants
Technologies
20
COURT: New York
August 15, 2012
Key Litigations
V-Chip
2012 2013
Appeal Hearing – Q4 2012 (estimated)
Trial – Q4 2013 (estimated)
Defendant
Technology
LG Case
21
COURT: Florida
August 15, 2012
Key Litigations
Bluetooth, Email/Text Editing
2012 2013
Trial – February 2014
RIM Case
Defendant
Technologies
2014
Markman – February 2013
22
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