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Transmeta Corp. said on Wednesday that it had begun to seek for an investor that would acquire the company. Transmeta said that after exploring a full range of strategic alternatives over the past few months and after strengthening its balance sheet, Transmeta plans to explore a possible sale of the company as a way to enhance value for all its stockholders.

“This year, as a result of our successful licensing activities, we will collect at least $265 million of cash payments for our intellectual property and patents. We expect that our intellectual property portfolio and licensing business, combined with our solid balance sheet, will be attractive to potential bidders, and we look forward to conducting a timely process to maximize value for our stockholders. As we proceed with the process, we remain focused on working with potential licensees, as well as developing and validating our IP blocks so that we can broaden our target market,” said Les Crudele, president and chief executive of Transmeta.

Interested parties are invited to contact the Transmeta’s financial advisor. The company noted that there can be no assurance that the process will result in a transaction that the company’s board determines is in the best interests of the company or its stockholders.  Further, there is no assurance concerning the type, form, structure, nature, results, timing or terms and conditions of any such transaction, even if a transaction does result from this process. 

In a news press release today, Transmeta announced that it has entered into two agreements with Intel. The first agreement is a fully paid-up, non-exclusive technology licensing agreement that provides for Transmeta to deliver a copy of certain proprietary Transmeta computing technologies to Intel and grants to Intel a non-exclusive license to use and exploit those technologies commercially. The second agreement is an amendment to the previously announced settlement, release and license agreement that Transmeta and Intel entered into on December 31, 2007.

That settlement agreement granted to Intel a perpetual non-exclusive license to all Transmeta patents and patent applications, including any patent rights later acquired by Transmeta, now existing or as may be filed on or before December 31, 2017. Among other things, that settlement agreement provided for Intel to make five annual future payments to Transmeta of $20 million per year for each year from 2009 though 2013. This amendment accelerates Intel's remaining future payment obligations under the settlement agreement. The afreement will result in a one-time, non-refundable payment of $91.5 million in the third quarter of 2008. 

“We are very pleased to have achieved the two agreements with Intel. Receiving these one-time payments strengthens our balance sheet and allows potential buyers to more accurately evaluate our company,” Mr. Crudele said.

The company does not intend to release additional information about the status of this sale process but will publicly report all required information on a timely basis.

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