WiSA Technologies, Inc. Mails Definitive Proxy and Encourages All Stockholders to Vote

Rhea-AI Summary

WiSA Technologies (NASDAQ: WISA) has mailed its Definitive Proxy Statement for the 2024 Annual Meeting of Stockholders, scheduled for December 20, 2024. The key focus is the planned $210 million acquisition of Data Vault Holdings' assets, including AI, blockchain, and Data Web 3.0 IP assets.

The purchase price comprises 40 million WiSA common shares at $5 per share, a $10 million 3-year Note, and a 3% royalty on applicable product revenues. The board unanimously recommends stockholders vote in favor of the Asset Purchase, which includes High-Performance Computing software and acoustic technologies IP. Stockholders of record as of November 6, 2024, can vote online, by phone, or mail.

Positive

• Acquisition of valuable IP assets in AI, blockchain, and Data Web 3.0 technologies
• Expansion into multiple high-growth sectors including bioengineering, healthcare, and fintech
• Board's unanimous support for the strategic acquisition

Negative

• Significant shareholder dilution through issuance of 40 million new shares
• Addition of $10 million in debt through 3-year Note
• 3% royalty payment obligation on future product revenues

Insights

Financial Analyst

The proposed $210 million Data Vault asset acquisition represents a significant strategic pivot for WiSA Technologies, currently valued at just $13.2 million market cap. The deal structure raises several red flags: The $200 million stock component at $5 per share represents massive dilution, as it's priced significantly above current trading levels. This would result in existing shareholders owning a minimal portion of the transformed company.

The acquisition targets emerging technology areas (AI, blockchain, Web 3.0) that are completely different from WiSA's core audio technology business. While the diverse industry applications could open new revenue streams, the dramatic shift in business model and lack of operational synergies increase execution risk. The 3% royalty structure on applicable revenues provides some ongoing value, but depends heavily on successful commercialization.

The deal's ambitious valuation and extreme dilution warrant careful scrutiny from shareholders before the December 20 vote. Integration challenges and the company's experience in the target markets present significant risks.

Tech Expert

The planned acquisition of Data Vault's High-Performance Computing software and IP portfolio marks an ambitious technological transformation. The assets span multiple cutting-edge domains including AI, blockchain and Web 3.0 - a dramatic departure from WiSA's historical focus on wireless audio solutions. While the broad application potential across industries like bioengineering, healthcare and fintech is promising, successfully integrating and monetizing such diverse technologies requires deep domain expertise and established market relationships.

The inclusion of acoustic technologies IP in the asset package provides some connection to WiSA's core competencies, but the company faces significant challenges in building credibility and capabilities across multiple new technology verticals simultaneously. The success of this pivot will heavily depend on retaining key technical talent and effectively commercializing the acquired IP portfolio.

- WiSA’s board unanimously recommends vote in favor of Data Vault asset purchase -

BEAVERTON, Ore.--(BUSINESS WIRE)-- WiSA Technologies, Inc. (NASDAQ: WISA), which is in a definitive agreement to acquire AI, blockchain and Data Web 3.0 IP assets of Data Vault Holdings, Inc.® (“Data Vault”) to form a data technology & licensing company leveraging IP & proprietary HPC software, has mailed a Definitive Proxy Statement for its 2024 Annual Meeting of Stockholders (the “Annual Meeting”), which is to be held on December 20, 2024, and included information regarding its planned acquisition of Data Vault’s ADIO® and Data Vault assets (the “Asset Purchase”). WiSA’s stockholders of record at the close of business on November 6, 2024 (the “Record Date”) will be entitled to vote at the Annual Meeting.

WiSA’s board of directors unanimously recommends that stockholders vote in favor of the Asset Purchase.

How to Vote
Stockholders of record can vote in one of three convenient ways. Have your 11-digit control number provided on your proxy card ready when voting by Internet or phone.

1. Online: Go to www.FCRvote.com/WISA and follow the prompts to vote your shares.
2. Phone: Call 1 866 402-3905 and follow the voting instructions to cast your vote.
3. Mail: Complete, sign, and return the proxy card in the postage-paid envelope provided.

Beneficial owners holding shares through a broker, bank, or other nominee should follow the voting instructions provided by their financial institution.

For additional information about the meeting and the proposals, please refer to the proxy materials available at https://web.viewproxy.com/WISA/2024.

Questions or Assistance
Stockholders who need assistance voting their shares may contact Alliance Advisors, which is serving as Proxy Solicitor:

Alliance Advisors
855-643-7310
WISA@allianceadvisors.com

The Asset Purchase Agreement
On September 4, 2024, as amended on November 14, 2024, WiSA Technologies executed a $210 million Definitive Agreement to purchase assets, including High-Performance Computing (HPC) software and acoustic technologies IP, from Data Vault, to create a licensing and technology company with an extensive patent portfolio serving multiple industry and government entities in bioengineering, energy, education, finance & fintech, healthcare, sports entertainment, consumer, restaurants, automotive, and more. The $210 million purchase price consists of 40 million shares of WiSA common stock to be issued at $5 per share plus a $10 million 3-year Note, along with a 3% royalty on applicable product revenues.

Stockholders’ Meeting
The Company filed a Definitive Proxy Statement (Amendment No. 1) on November 26, 2024, for the Annual Meeting to be held on December 20, 2024 at 1:00 p.m., Pacific Time, at the Company’s offices at 15268 NW Greenbrier Pkwy, Beaverton, Oregon 9700. Stockholders have an opportunity to vote at the Annual Meeting to approve the Asset Purchase, along with the various other proposals included in the Definitive Proxy Statement. If approved by stockholders, WiSA expects that the Asset Purchase will close shortly after the Annual Meeting, subject to satisfaction of customary closing conditions.

About Data Vault Holdings, Inc.
Data Vault Holdings Inc. is a technology holding company that provides a proprietary, cloud-based platform for the delivery of blockchain objects. Data Vault Holdings Inc. provides businesses with the tools to monetize data assets securely over its Information Data Exchange® (IDE). The company is in the process of finalizing the consolidation of its affiliates Data Donate Technologies, Inc., ADIO LLC, and Datavault Inc. as wholly owned subsidiaries under one corporate structure. Learn more about Data Vault Holdings Inc. here.

LEGAL DISCLAIMER

Forward-Looking Statements
This press release of WiSA Technologies, Inc. (NASDAQ: WISA) (the “Company”, “us”, “our” or “WiSA”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements, include, among others, the Company’s and Data Vault Holdings, Inc.’s (“Datavault”) expectations with respect to the proposed asset purchase (the “Asset Purchase) between them, including statements regarding the benefits of the Asset Purchase, the anticipated timing of the Asset Purchase, the implied valuation of Datavault, the products offered by Datavault and the markets in which it operates, and the Company’s and Datavault’s projected future results and market opportunities, as well as information with respect to WiSA’s future operating results and business strategy. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of a variety of factors, including, but not limited to: (i) risks and uncertainties impacting WiSA’s business including, risks related to its current liquidity position and the need to obtain additional financing to support ongoing operations, WiSA’s ability to continue as a going concern, WiSA’s ability to maintain the listing of its common stock on Nasdaq, WiSA’s ability to predict the timing of design wins entering production and the potential future revenue associated with design wins, WiSA’s ability to predict its rate of growth, WiSA’s ability to predict customer demand for existing and future products and to secure adequate manufacturing capacity, consumer demand conditions affecting WiSA’s customers’ end markets, WiSA’s ability to hire, retain and motivate employees, the effects of competition on WiSA’s business, including price competition, technological, regulatory and legal developments, developments in the economy and financial markets, and potential harm caused by software defects, computer viruses and development delays, (ii) risks related to the Asset Purchase, including WiSA’s ability to close the Asset Purchase in a timely manner or at all, or on the terms anticipated, whether due to WiSA’s ability to satisfy the applicable closing conditions and secure stockholder approval from WiSA stockholders or otherwise, as well as risks related to WiSA’s ability to realize some or all of the anticipated benefits from the Asset Purchase, (iii) any risks that may adversely affect the business, financial condition and results of operations of Datavault, including but not limited to cybersecurity risks, the potential for AI design and usage errors, risks related to regulatory compliance and costs, potential harm caused by data privacy breaches, digital business interruption and geopolitical risks, and (iv) other risks as set forth from time to time in WiSA’s filings with the U.S. Securities and Exchange Commission (the “SEC”). The information in this press release is as of the date hereof and neither the Company nor Datavault undertakes any obligation to update such information unless required to do so by law. The reader is cautioned not to place under reliance on forward looking statements. Neither the Company nor Datavault gives any assurance that either the Company or Datavault will achieve its expectations.

This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, nor will there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of such state or jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act, or an exemption therefrom.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241205434149/en/

Investors Contact for WiSA Technologies and Data Vault Holdings:

David Barnard, Alliance Advisors Investor Relations, 415-433-3777, wisa@lhai.com

Source: WiSA Technologies, Inc.

FAQ

What is the value of WiSA Technologies' Data Vault asset purchase agreement?

The total purchase price is $210 million, consisting of 40 million shares at $5 per share, a $10 million 3-year Note, and a 3% royalty on applicable product revenues.

When is WiSA Technologies' Annual Meeting for the Data Vault acquisition vote?

The Annual Meeting is scheduled for December 20, 2024, at 1:00 p.m. Pacific Time at the company's offices in Beaverton, Oregon.

What assets is WISA acquiring from Data Vault Holdings?

WISA is acquiring AI, blockchain, Data Web 3.0 IP assets, High-Performance Computing software, and acoustic technologies IP from Data Vault Holdings.