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patent lawsuit at $1 million and the cost of defending a patent
lawsuit at $2 million.2
Over the years from its founding in 1988 until the October
1997 acquisition by ATMI, management of ADCS, of petitioner, of
Holdings LLC and Operating LLC, and of ADCS-Limited generally
maintained a policy of funding their activities and growth with
internally generated funds, and they did not seek or obtain
outside long-term financing to fund research and development of
new products, corporate moves, new plant and office construction,
or working capital. With the exception of the $72,000 bank loan
obtained in 1990, all of the growth and expansion of ADCS, of
petitioner, and of the affiliated companies was financed with
funds raised within the affiliated companies.
During the calendar years of 1996 and 1997, Siegele was paid
by ADCS-Limited a salary of approximately $2 million. Other
senior management personnel of ADCS-Limited and of the affiliated
companies also were paid, apparently by ADCS-Limited, annual
salaries of approximately $300,000 each.
For each of the 1996 and 1997 calendar years, a consolidated
income statement of ADCS, of petitioner, of the affiliated
limited liability companies, and of ADCS-Limited reflected sales
2 In 1999, ATMI paid approximately $2.7 million in
connection with patent litigation relating to the business
activities of petitioner and of its affiliated companies.
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