Wave Computing and its subsidiaries including MIPS Tech, announced that the Company has reached an agreement with its secured lender Tallwood Technology Partners, LLC to restructure the Company's current capital structure and provide substantial recovery to the Company's unsecured creditors via amendments to the Company's proposed Chapter 11 plan of reorganization. The Company commenced an auction on December 21, 2020 seeking the highest or otherwise best offer to restructure or purchase the Company's business, and, after improving its initial restructuring bid by nearly $10 million, Tallwood was identified as the successful bidder the next day.
The conclusion of the auction and decision to move forward with the Tallwood restructuring moves Wave's Chapter 11 cases a large step toward conclusion. Wave initiated its restructuring in April 2020 and has since run a thorough marketing process. The restructuring will allow Wave to refocus its business around the continued commercialization of the Company's storied MIPS architectures, and position itself for sustainable long-term growth. The restructuring is expected to generate a high recovery for the Company's creditors, and represents a strong outcome for all the Company's stakeholders.
The restructuring proposal will be submitted to creditors for a vote and presented to the U.S. Bankruptcy Court for the Northern District of California for approval in early 2021, and if approved, will allow the Company to emerge from Chapter 11 protection shortly thereafter.
"We are pleased to find a partner in Tallwood that will be able to further develop Wave's landmark MIPS architectures," said Larry Perkins, Chief Restructuring Officer of Wave Computing. "We hope Tallwood's stewardship will allow Wave's groundbreaking technology to continue to transform the processor landscape and benefit a range of new customers. I'm thankful for the entire team at Wave, who have worked so hard throughout the Chapter 11 process to put the Company on the path to future success."
"Following productive discussions with all of our stakeholders, we are confident the Company's path forward under Tallwood ownership is a strong strategic fit as well as a successful financial outcome," said Tom FitzGerald, independent director of Wave Computing. "We believe this transaction represents the best possible conclusion to the Chapter 11 process for the Company as well as its employees, creditors, and customers."
A team from Sidley Austin LLP led by Sam Newman is serving as legal counsel to Wave, SierraConstellation Partners is serving as financial and restructuring adviser, and Armory Securities is serving as investment banker. Binder & Malter LLP is serving as legal counsel to Tallwood.