yahoo.brand.edgar-online.com/fetchFi... From gross proceeds of any payment (whether in kind or otherwise) received relating to the Patents, whether in satisfaction of a judgment, in settlement of litigation, for a license or covenant not to sue, or otherwise relating to a resolution in its litigation and licensing program, without deduction for any attorneys’ fees, expenses or court costs relating to such litigation or licensing program (collectively, the “Proceeds”), Patriot will pay Fish and the Trust, on a quarterly basis, as follows:

To Fish:

(a) Patriot will pay Fish eleven and one half percent of the Proceeds until Fish receives $99 million;

....

``

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I have reread PTSC`s 2004 contract with Fish cited above, and some disturbing thoughts occurred to me. Here are my concerns:

1. ``12% of GROSS RECEIPTS`` The contract calls for 11.9% of the gross receipts to be paid to Fish and the Fish family Trust (up to $100M combined). This amount is before any deductions for legal expenses, etc.

Note that the words do not say ``payments to Patriot``, but rather ``gross proceeds of any payment... received``.

Since the words in the contract do not refer to ``receipts to Patriot``, I am concerned that a judge may rule that Fish is entitled to the 12 percent based on total receipts to the joint venture (as opposed to the cash disbursed to Patriot from the joing venture.) That would mean that if Fish prevailed in the lawsuit, Patriot will have to pay 12% of whatever amount is received by both TPL and PTSC.

For example, if this contract were enforced the way I think it reads, of the total of $78 million received to date, Fish and the Fish Family Trust would be entitled to $9.36 million from PTSC. So of the $36 million or so received by PTSC, the amount available to distribute to shareholders as dividends or buy back stock would be substantially received.

2. Nowhere in the contract is the payment of the amounts to Fish and family made contingent on PTSC succeeding in its attempts to obtain sole ownership of the patents that PTSC believed was invented solely by Fish.

Note the actual wording:

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``WHEREAS, Patriot has commenced a litigation and licensing program involving the Patents;

WHEREAS, Patriot desires to enter into an agreement under which Fish could share in the proceeds of its litigation and licensing program;

WHEREAS, Patriot seeks the cooperation of Fish in its litigation and licensing program....(omissions here)

WHEREAS, Fish asserts that he has no prior binding agreement with Patriot that will compensate him for his contributions to the Patents;

WHEREAS, Patriot believes that: Fish appears to be the sole inventor of several of the Patents; Charles H. Moore (“Moore”) appears to be the sole inventor of others; and Fish and Moore appear to have jointly invented the others; but the correct statement of inventorship for all sever patents has never been made;

WHEREAS, Patriot believes that it and the Trust entered into a prior agreement dated April 24, 2003, under which the Trust was to receive a portion of the proceeds derived by Patriot from the Patents; and the Trust disputes the existence of such an agreement;

WHEREAS, Patriot and the Trust desire to resolve any dispute regarding the existence of an April 24, 2003 agreement, and desire to extinguish any April 24, 2003, agreement, if such an agreement ever existed, and instead enter into this new agreement.

THE PARTIES, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH IS ACKNOWLEDGED, AGREE AS FOLLOWS:

1. From gross proceeds of any payment (whether in kind or otherwise) received relating to the Patents, whether in satisfaction of a judgment, in settlement of litigation, for a license or covenant not to sue, or otherwise relating to a resolution in its litigation and licensing program, without deduction for any attorneys’ fees, expenses or court costs relating to such litigation or licensing program (collectively, the “Proceeds”), Patriot will pay Fish and the Trust, on a quarterly basis, as follows: ``

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IMHO, the Fish contract was poorly drafted from PTSC`s standpoint since it exposed PTSC to the risk that was eventually realized... a defeat of the bid for sole ownership of the `336 and other key patents without a related automatic voiding of the compensation contract with Fish.

Note that Fish is not even making a stipulation that he is the sole inventor of the patents that PTSC believes him to be the sole inventor. So the payments to Fish appear to be conditional only on his cooperation with PTSC. If this is the case, then it would appear that the strongest chance PTSC has of winning against Fish is his non-performance of the conditions spelled out in the contract.

These are all my layman`s opinion. I will welcome any intelligent discussion of these points from the attorneys o n this board, or others who can place themselves in the role of a jury and try to guess our chances of winning the lawsuit against Fish.

I am not a basher. But I believe the Fish lawsuit carefully and try to anticipate the possible bumps in the road ahead for our beloved PTSC. GLTAL

--Knixx_99