About Wave

Wave Systems is a leading provider of client and server software for hardware-based digital security, enabling organizations to know who is connecting to their critical IT infrastructure, protect corporate data, and strengthen the boundaries of their networks. Wave’s core products are based around the Trusted Platform Module (TPM), the industry-standard hardware security chip that is included as standard equipment on most enterprise-class PCs shipping today. A TPM is a highly secure cryptographic support system. It generates, stores and processes keys, which can be used to encrypt information and harden identities. It provides a broad range of security features, but because the TPM works independently of the operating system, it can serve as a “root of trust,” verifying the integrity of the machine and user.

Wave’s comprehensive suite of client and server tools leverage and manage these capabilities, so any organization can implement a safer, more trusted computing environment within their enterprise today (see Trusted Computing Pioneer). Today, Wave’s flagship software offering, EMBASSY® Trust Suite, comes installed on every business-class laptop computer shipping from Dell.

In 2007, the company expanded its presence in hardware security by joining forces with global hard drive manufacturer Seagate Technology, LLC. Wave is now the leading provider of support and management tools for Seagate’s full disk encrypting (FDE) hard drives, which are available through Dell and other distributors. Fully integrated with Wave’s TPM solutions, the company’s FDE offering delivers a powerful security solution for protecting an enterprise’s high-value information assets.

Wave subsidiary Wavexpress provides broadband media technology and services. Wave’s eSign Systems division provides software enabling organizations to create, sign, store, access and manage the lifecycle of legally binding electronic records.

Incorporated in 1988 as Indata Corp., the company eventually changed its name to Wave Systems Corp. in 1993. Wave went public the following year and is listed on the NASDAQ exchange under the WAVX ticker symbol. The company’s 110 employees are located in Lee, MA, Cupertino, CA, Princeton, N.J. and Paris, France. Its sales force is dispersed throughout the U.S. and Europe.

For more information please visit www.wave.com.

Mr. Steven K. Sprague
President and CEO
WAVE Systems Corp.
www.wave.com
Nasdaq: WAVX

SecurityStockWatch.com: Thank you for joining us today, Steven. Much has happened with WAVX during the past year: revenues are up, the stock is up and the list of impressive partners working with you keeps growing. Please give us an overview of Wave Systems’ solutions and provide us with some background on the company.

Steven K. Sprague: Wave Systems is the leading provider of client and server software for hardware-based security on personal computers. We’re traded on the NASDAQ Capital Market Exchange under the symbol WAVX, and today we have about 100 employees worldwide.

Our business is based on providing the tools for the world to leverage the new hardware-based security solutions shipping on most PCs. Hardware security can mean different things, but in our world it revolves around a security chip called the Trusted Platform Module or TPM. The PC industry has spent ten years developing this hardware security chip to address the obvious security problems inherent in software products.

TPMs ship with virtually every business-class laptop and most enterprise desktops. These chips change the PC security paradigm, acting as a strongly protected system for securely generating and storing encryption keys. Since the TPM provides advanced security for keys and is invulnerable to both network and software attacks, the TPM chip can authenticate hardware devices. Therefore, an organization that turns on the TPM chips on its laptops can restrict all but “known” PCs to its network. That’s a simple, yet very powerful step to increase network security. The TPM can perform a host of other functions, too, from encrypting individual files to storing passwords, digital certificates and cryptographic keys. These chips can also perform a function called “remote attestation,” creating an unalterable summary of the hardware, boot and operating system’s configuration so that a third party can verify the state of the software to determine if it can be ‘trusted’ and that it has not been tampered with. Because information and functions occur within the security chip, it is far more secure from external software attacks and physical theft than other methods. More

Mr. Lark Allen
Executive Vice President
WAVE Systems Corp.
www.wave.com
Nasdaq: WAVX

SecurityStockWatch.com: Lark, please give us an overview of your background and role at Wave.

Lark Allen: My primary IT industry background came from 28 years at IBM where I held a wide range of positions in sales and marketing, development and consulting. I joined Wave in 1998 after retiring from IBM having seen firsthand the dramatic impact that personal computers and distributed technologies had on highly centralized IT infrastructures, including mainframes. Wave was a vocal proponent for establishing “trust” in end user devices even back then. I fully realized the great potential that this strategic design represented to again revolutionize IT architectures, and I still believe that embedding “trust” in user devices is the future for all networks.

For the past 13 years at Wave, I have been involved in the business and corporate development activities associated with this vision. My focus has been on developing a wide range of relationships with technology providers, distribution chains and developing partnerships. Work in this arena has focused on the development of trusted applications in such areas as identity and access management, data protection, secure transactions and content distribution. I’ve also been fairly active on the company’s behalf helping form, and serving on, a number of industry standards groups, including the Trusted Computing Group, OpenID and Information Card Foundations, International Security, Trust and Privacy Alliance (ISTPA) and the Liberty Alliance.

Most recently, I’ve been involved in the industry initiative to move data encryption and platform authentication out of software and into the trusted hardware of storage devices. That work culminated in the publishing of the first open industry specifications around encryption and access control by the "Trusted Computing Group's Storage Work Group" in January, 2009, and announcements of self-encrypting drives by at least six major drive OEMs. Wave has taken a leadership role in this effort, working with most of the major storage vendors to develop the most robust management and control infrastructure for self-encrypting drives based on these standards. More