Company: ACTG
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0000934549-25-000054
Chunk: 88

Company: ACACIA RESEARCH CORP
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 1
Chunk 88
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2025, if recognized $758,000 of tax benefits would impact the Company’s effective tax rate subject to valuation allowance. The Company does not expect that the long-term liability for unrecognized benefits will change significantly within the next 12 months. The Company recognizes interest and penalties with respect to unrecognized tax benefits in income tax expense (benefit).

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. 

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ASC 740, “Income Taxes,” requires the effects of changes in tax rates and laws to be recognized in the period in which the legislation is enacted. The Company has implemented OBBBA in the current quarter calculations.

Liquidity and Capital Resources

General

Our foreseeable material cash requirements as of September 30, 2025, are recognized as liabilities or generally are otherwise described in Note 15, “Commitments and Contingencies,” to the consolidated financial statements included elsewhere herein. In particular, our facilities lease obligations, guarantees and certain contingent obligations are further described in Note 15 to the accompanying consolidated financial statements. Historically, we have not entered into off-balance sheet financing arrangements. In addition, the obligations of our Energy Operations Business related to the Benchmark Revolving Credit Facility and the obligations of our Manufacturing Operations Business related to the Deflecto Facility are further described in Note 11 to the accompanying consolidated financial statements. The obligations of our Energy Operations Business related to the asset retirement obligations are further described in Note 10 to the accompanying consolidated financial statements.

Additional cash requirements are generally derived from our operating and investing activities including expenditures for working capital (discussed below), property and equipment, additions to oil and gas properties, human capital, business development, investments in equity securities and intellectual property, and business combinations. 

Certain of our Intellectual Property Operations operating subsidiaries are often required to engage in litigation to enforce their patents and patent rights. In connection with any of our operating subsidiaries’ patent enforcement actions, it is possible that a defendant may request and/or a court may rule that an operating subsidiary has violated statutory authority, regulatory authority, federal rules, local court rules, or governing standards relating to the substantive or procedural aspects