One of the early pioneers of the VoIP industry, VocalTec (News - Alert) Communications announced that it has signed a Patent Purchase Agreement (PPA) to sell selected patents — half of their VoIP related portfolio — to Karo Millennium J.P., L.L.C.

 

VocalTec agreed to sell 11 of its 22 patents and certain patent-related rights for the price of $12.5 million. The package being sold to Karo Millenium comprises nine U.S. patents, one Israel patent and one Australian patent. The transaction is subject to a series of legal conditions, and when completed, VocalTec will maintain certain rights, including a “geographically unlimited, non-exclusive license to use the sold patents and other patent-related rights in connection with the development and marketing of its products.”

 

VocalTec will hang on to an additional 11 patents as well as several trademarks, which includes the term “Internet Phone.”

 

Yosi Albagli, VocalTec’s Chief Executive Officer, commented, “We are happy to have entered into an agreement with Karo Millennium J.P., L.L.C. that demonstrates the value attributed to VocalTec’s technology and solutions. The funds that we will receive from the monetization of the patents and patent-related rights to be sold will allow us to continue expanding our sales and marketing efforts, as we move forward with our growth plans. We believe that there is great potential for our VoIP solutions, and we look forward to exploring the opportunities that lie ahead.”

 

Far from its high-flier days of the late 90’s, VocalTec has had a bumpy road recently, and was warned of delisting by NASDAQ as recently as February of this year. The company received a NASDAQ Staff Deficiency Letter, indicating failure to comply with the minimum bid price requirement for continued listing (set forth in Marketplace Rule 4320(e)(2)(E)(ii)).

 

NASDAQ has given VocalTec until August 4, 2008 to regain compliance. What this means is that VocalTec’s shares must close at $1.00 per share or more for a minimum of 10 consecutive business days leading into the August 4 deadline.

 

Still, VocalTec continues to win customers and deploy systems. Earlier this year, the company announced that Nexus Telecom (News - Alert), a Brazilian CLEC and VoIP operator had selected their Essentra VoIP Peering (News - Alert) and Trunking solution. Also, in January, VocalTec announced deployment at a leading PTT in Latin America to provide voice services over its WiMAX (News - Alert) network. The deployment involves the provision of VoIP/NGN services over a WiMAX Access Network and includes the Essentra iCX media gateway controller.