RELM Wireless settles lawsuit
RELM Wireless Corp. announced it has reached an agreement to settle an 11-year-old lawsuit that was originally filed against its predecessor, Adage Inc., in 1993. Under the terms of the agreement, the company will pay to the plaintiff cash totaling $120,000 and issue to the plaintiff 6,452 shares of restricted RELM common stock valued at the closing price on March 1, 2004, which was $3.10. The lawsuit related to the note of a former affiliate totaling $1.7 million, plus $2.6 million in alleged accrued interest, the company said in a press statement. The company also said the settlement would “eliminate the potential for an unfavorable verdict in the total amount of the note, accrued interest and legal fees.”
As a result of the settlement, RELM adjusted its fourth quarter 2003 earnings statement, recognizing an additional expense related to this matter totaling $140,000. Including the impact of this agreement, net income for Q4 2003 was $832,000, or $0.08 per diluted share, while net income for the full year was $868,000, or $0.09 per diluted share. Previously, the company reported net income for Q4 2003 of $972,000, or $0.09 per diluted share, and net income for the full year of $1.008 billion, or $0.11 per diluted share.