CHICAGO, Dec. 3, 2012 /CNW/ - Lexington Technology Group Inc. (LTG)
recently appointed veteran IP executive Jeff Ronaldi as chief executive
officer of the company, as it prepares for a merger with Document
Security Systems Inc. (NYSE MKT: DSS). Ronaldi will continue as CEO
following the merger. Ronaldi, a former board advisor to Lexington,
replaced Will Rosellini, who now assumes an advisor role to LTG's
wholly owned subsidiary, Bascom Research, LLC.
Ronaldi has spent the last ten years specializing in monetizing
patents. Ronaldi brings expertise in leading successful patent
lawsuits, including winning a $50 million verdict for Shelbyzyme
against Genzyme and a $20 million willful infringement verdict versus
Citrix Systems Inc. in 2012. He also managed a venture capital group
for SPX Corp, in which he was behind a patent infringement lawsuit
against Microsoft that resulted in a $62.3 million verdict, which later
settled for $60 million. Prior to LTG, Ronaldi served as CEO of Turtle
Bay Technologies, Ltd, a wholly owned subsidiary of Juridica Capital.
There, he used his financial expertise to determine the value of
different patent technologies.
"In many ways, leading Lexington is a perfect opportunity to leverage
the two phases of my career: leading technology startups and monetizing
IP," Ronaldi stated about his appointment. "One of the things that
attracted me to Lexington is the quality of the portfolio. I've been
monetizing patents for more than 10 years and I've had a lot of
success. I expect this portfolio to be every bit as successful as any
of the others I've managed."
Also, DSS has promoted Robert Bzdick to acting CEO. Bzdick , DSS's
current President and Chief Operating Officer, brings an extensive
background in managing manufacturing operations. He will assume this
role until the merger of the two companies become finalized, projected
for the in the first half of 2013.
While LTG owns intellectual property assets, DSS specializes in
anticounterfeit, authenticication, and mass-serialization
technologies. Its technologies are designed to determine the
authenticity of different products in various forums. This combination
will help strengthen DSS's intellectual property portfolio and
potentially enhance its revenue through the monetization of the
combined company's intellectual property assets. If the merger closes,
LTG will bringing over $7 to $10 million in debt free cash to DSS.
LTG acquired patent assets from Thomas L. Bascom, president of
LinkSpace, LLC. LTG and Linksys are currently collaborating, through
Bascom Research, to pursue research and development of radio frequency
identification (RFID) software for use in the electronic health records
space. Bascom Research hopes to increase the safety of patents in
hospitals through utilizing its assets with LinkSpace's
enterprise-level software framework and DSS's digital security.
Bascom Research also owns several patents regarding the means for
companies to utilize social media. For the most part, Bascom Research
is enforcing these patents by suing major social media platforms for
patent infringement. Bascom Research could bring hundreds of millions
of dollars to the new combined LTG/DSS entity if it can win any of its
lawsuits filed against five companies, including Facebook (FB),
LinkedIn (LNKD), and Jive Software (JIVE), which are pending in federal
court for the Eastern District of Virgina. For its claims against
Facebook, Bascom is seeking past damages dating back to 2006. Since
that time, the social media giant has generated $7.38 billion, so a potential damages award could be massive. A hearing is scheduled
for December 7, 2012 to determine whether the case will remain before
the "rocket docket" in Virginia or be moved elsewhere.
DSS 3rd Quarter Results
DSS reported several improvements in its Q3 results including a 15% revenue jump from Q3 of 2011. Year-to-date, total
revenue is $11.7 million, which is a 27% increase from 2011 and put ths
company on pace for its strongest year.
Increased sales in the packaging division led the way for DSS, rising
39% during the quarter. Licensing and digital sales also increased by
13% from the prior quarter. Overall, for the first nine months of 2012,
packaging sales are up by 54% from the first nine month of 2011 and
licensing and digital sales have increased 27%.
DSS also made strides in its gross profit performance during Q3, which
saw gross profit increase by 20% from Q3 2011. This resulted in gross
profits reaching $1.52 million for the quarter. DSS has made efforts to
streamline operating costs and focus its attention on sales efforts
with higher margin opportunities. These decisions have paid off for DSS
mainly in its printing division, where gross profit for the year to
date has increased by 149%.
When measuring performance using adjusted EBITDA, the third quarter
reflected a 7% improvement over adjusted EBITDA of Q3 of 2011.
These results seem to be promising for DSS, as it has an opportunity to
build on its 3rd quarter momentum in the fourth quarter, which has historically been the
DSS's former CEO Patrick White stated, "We are very pleased with our
third quarter results, where we saw strength in all of our business
divisions. As we enter the final quarter of 2012, we expect to
continue to build upon our revenue and gross profit growth that allowed
us to reach the important financial milestone of positive adjusted
EBITDA in the month of September."
DSS stock last traded at $2.70 with a market capitalization of $58.6
million. Over the last year, the company has traded between $2.26 and
$5.12 per share.
SOURCE: Rob Amaefule's Office
For further information: