v3.26.1
Subsequent Events
6 Months Ended
Jun. 30, 2026
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

NOTE 11: SUBSEQUENT EVENTS

 

R.J. Reynolds Settlement and Patent License Agreement

 

On July 10, 2026, the Company entered into a Settlement and Patent License Agreement with R.J. Reynolds Vapor Company relating to litigation concerning the Company’s U.S. Patent No. 8,205,622 B2. Under the agreement, the Company is entitled to receive consideration of $14.9 million in exchange for resolving the litigation, providing mutual releases and granting R.J. Reynolds Vapor Company and its affiliates a non-exclusive, worldwide, fully paid-up, perpetual and irrevocable license to use the patent with respect to certain licensed products. On July 16, 2026, the Company received the $14.9 million in cash pursuant to the agreement. The Company is evaluating the appropriate accounting treatment and financial statement impact of the agreement.

 

Dissim Royalty Buyout

 

On July 15, 2026, the Company agreed to pay an aggregate of $135,000 to the former owners of the Dissim business in full satisfaction of the Company’s remaining royalty obligations associated with its September 2020 acquisition of the Dissim business and related assets. As a result, no further royalties will be payable to the former owners. The agreement does not affect the Company’s ownership of the previously acquired Dissim business, assets or intellectual property. The Company is evaluating the appropriate accounting treatment and financial statement impact of the agreement.

 

The agreement was entered into subsequent to June 30, 2026, and no liability related to the $135,000 buyout was outstanding as of June 30, 2026. Accordingly, no accrual was required as of June 30, 2026.

 

JUUL License and Release Agreement

 

On July 22, 2026, the Company entered into a License and Release Agreement with JUUL Labs, Inc. relating to the Company’s U.S. Patent No. 8,205,622 B2 and certain other patent claims. Under the agreement, the Company is entitled to receive aggregate consideration of $11.0 million, payable pursuant to an installment schedule. In exchange for the consideration and mutual releases, the Company granted JUUL Labs, Inc. and its affiliates a non-exclusive, worldwide, perpetual and irrevocable license to use the patent and certain other patent claims with respect to specified licensed products. On July 27, 2026, the Company received the initial $4.0 million cash payment pursuant to the installment schedule. The remaining consideration is payable in accordance with the terms of the agreement. The Company is evaluating the appropriate accounting treatment, including the timing of recognition, and the financial statement impact of the agreement.