Powerwave Technologies, Inc. (NASDAQ: PWAV) designs, manufactures, and markets end-to-end wireless solutions for wireless communications networks worldwide.
On January 28, 2013, Powerwave Technologies (The Company) filed a voluntary petition for relief (the “Bankruptcy Filing”) under chapter 11 of title 11 of the United States Bankruptcy Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) case number 13-10134. The Company’s foreign and U.S. subsidiaries (collectively, the “Non-Filing Entities”) were not part of the Bankruptcy Filing. The Company will continue to operate its businesses as a “debtor in possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. The Non-Filing Entities will continue to operate in the ordinary course of business. The Company intends to use the protections afforded under Chapter 11 the Bankruptcy Code to, among other things, facilitate a reorganization or sale of the Company or its assets.
The Company’s stockholders are cautioned that trading in the shares of the Company’s common stock during the pendency of the Bankruptcy Filing will be highly speculative and will pose significant substantial risks. Trading prices for the Company’s common stock may bear little or no relationship to the actual recovery, if any, by holders thereof in the Company’s Bankruptcy Filing. Accordingly, the Company urges extreme caution with respect to existing and future investments in its common stock. In connection with the Bankruptcy Filing, no assurance can be given as to the value, if any, that may be ascribed to our various pre-petition liabilities or the Company’s common stock. The Company cannot predict what the ultimate value of its common stock may be or whether the holders of common stock will receive any distribution in the Company’s reorganization; however, it is likely that the Company’s common stock will have very little or no value given the amount of the Company’s liabilities compared to its assets.
The Company is subject to a number of risks and uncertainties associated with the Bankruptcy Filing, which may lead to potential adverse effects on the Company’s liquidity, results of operations, brand or business prospects. The Company cannot provide any assurance of the outcome of the Company’s chapter 11 proceeding. Risks associated with the Bankruptcy Filing may impact all entities, including the Non-Filing Entities, and include the following:
- the ability of the Company to continue as a going concern;
- the Company’s ability to obtain Bankruptcy Court approval with respect to motions in the chapter 11 case and the outcomes of Bankruptcy Court rulings of the case in general;
- the length of time the Company will operate under the chapter 11 case and its ability to successfully emerge;
- the ability of the Company and its subsidiaries to develop and consummate one or more plans of reorganization with respect to the chapter 11 case or to effectuate a sale in the chapter 11 case;
- the Company’s ability to obtain Bankruptcy Court and creditor approval of any reorganization plan and the impact of alternative proposals, views and objections of creditor committees and representatives, which may make it difficult to develop and consummate a reorganization plan in a timely manner;
- risks associated with third party motions in the chapter 11 case, which may interfere with the Company’s plan of reorganization or a sale of the Company or its assets;
- the ability to maintain sufficient liquidity throughout the chapter 11 proceedings;
- increased costs related to the bankruptcy filing and other litigation;
- the Company’s ability to manage contracts that are critical to its operations, to obtain and maintain appropriate terms with customers, suppliers and service providers;
- whether the Company’s non-U.S. subsidiaries continue to operate their businesses in the normal course; and
- the Company’s ability to retain its key employees who may choose to seek other opportunities due to the uncertainties surrounding the Company and its lack of financial resources.
On January 28, 2013, in light of the Bankruptcy Filing described above, the Company requested that the hearing before the Panel be cancelled. In response to the Bankruptcy Filing, by letter dated January 28, 2013, NASDAQ notified the Company that its common shares would be suspended at the open of business on January 30, 2013 and that NASDAQ will file a Form 25 Notification of Delisting with the Securities Exchange Commission in accordance with its internal procedures.