Company: SONM
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001641172-25-022821
Chunk: 19

Company: SONIM TECHNOLOGIES INC
Filing Date: 2025-08-08
Form: 10-Q
Item: Item 8
Chunk 19
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. costs and 15 years for foreign costs. The new legislation will no longer require U.S. research and development
costs to be capitalized; however, foreign costs will continue to be capitalized and amortized over 15 years. U.S. costs that were capitalized
in tax years 2022 through 2024 can be expensed in 2025 or over a two-year period, 2025 and 2026. Since the legislation was enacted subsequent
to June 30, 2025, there was no accelerated deduction for prior year U.S. capitalized costs during the period ended June 30, 2025. The
Company is currently evaluating the impact the adoption of the OBBBA will have on its condensed consolidated financial statements.

NOTE
8 — Commitments and Contingencies

Purchase
Commitments

The
aggregate amount of noncancelable purchase orders as of June 30, 2025, and December 31, 2024, was approximately $15,959 and $15,753,
respectively, and were related to the purchase of inventory and components for the Company’s devices, and certification services.

Royalty
payments

The
Company is required to pay per unit royalties to wireless essential patent holders and other providers of integrated technologies on
mobile devices delivered, which, in aggregate, amount to less than 5% of net revenues associated with each unit and expire between 2025
and 2033. Royalty expense for the three months ended June 30, 2025, and 2024 was $201 and $252, respectively. Royalty expense for the
six months ended June 30, 2025, and 2024 was $434 and $482, respectively. Royalty expense is included in Cost of Revenues. The Company
may be required to pay additional royalties to additional patent holders and technology providers on future products.

    14

General
litigation

The
Company is involved in various legal proceedings arising in the normal course of business. The Company does not believe that the ultimate
resolution of these other matters will have a material adverse effect on its consolidated financial position, results of operations,
or cash flows.

AJP
and Orbic Litigation

On
April 24, 2025, AJP Holding Company, LLC (“AJP”) on behalf of itself and Orbic North America, LLC (“Orbic”),
filed a complaint in the Delaware Court of Chancery against the Company and directors Mike Mulica