Wave Receives Nasdaq Notice of Minimum Bid Price Non-Compliance

Lee, MASeptember 16, 2009 — Wave Systems Corp. (NASDAQ:WAVX www.wave.com) announced that on September 15, 2009, it received notification from the Listing Qualifications Department of The Nasdaq Stock Market indicating that the Company’s Class A Common Stock is subject to potential delisting from The Nasdaq Capital Market because, for a period of 30 consecutive business days, the bid price of the Company’s Class A Common Stock has closed below the minimum $1.00 per share requirement for continued inclusion under Nasdaq Marketplace Rule 5550(a)(2) (the "Bid Price Rule").

The Nasdaq notice indicated that, in accordance with Nasdaq Marketplace Rule 5810(c)(3)(A), Wave will be provided 180 calendar days, or until March 15, 2010 to regain compliance. If, at any time before March 15, 2010, the bid price of the Company’s Class A Common Stock closes at $1.00 per share or more for a minimum of 10 consecutive business days, Nasdaq staff will provide written notification that it has achieved compliance with the Rule.

If Wave fails to regain compliance with the Bid Price Rule before March 15, 2010, but meets all of the other applicable standards for initial listing on The Nasdaq Capital Market with the exception of the minimum bid price, then Wave will have an additional 180 calendar days, or until September 13, 2010, to regain compliance with the Bid Price Rule. Wave currently meets The Nasdaq Capital Market initial listing requirements set forth in Nasdaq Marketplace Rules 5505(a) and 5505(b)(2) except for the minimum bid price and the $4 million shareholders’ equity requirements.

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About Wave Systems Corp.

Wave is a pioneer in hardware-based PC security that provides software to help solve critical enterprise PC security challenges such as data protection, strong authentication, network access control and the management of these enterprise functions.  Wave is a founding member of the Trusted Computing Group (TCG), a consortium of more than 100 companies that forged open standards for hardware security.  Wave’s EMBASSY® line of client- and server-side software leverages and manages the security functions of the TCG’s industry standard hardware security chip, the Trusted Platform Module (TPM) as well as hard drives that comply with TCG’s “Opal” self-encrypting drive (SED) standard.  Self-encrypting drives are a growing segment of the data protection market, offering increased security and better performance than most existing software-based encryption solutions.  TPMs are standard equipment on many enterprise-class PCs shipping today and have shipped on an estimated 300 million PCs worldwide.  Using TPMs and/or SEDs and Wave software, enterprises can substantially and cost-effectively strengthen their current security solutions.  Visit http://www.wave.com for more information.

Safe Harbor for Forward Looking Statements

Except for the statements of historical fact, the information presented herein constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  Such factors include general economic and business conditions, the ability to fund operations, the ability to forge partnerships required for deployment, changes in consumer and corporate buying habits, chip development and production, the rapid pace of change in the technology industry and other factors over which Wave Systems Corp. has little or no control.  Wave Systems assumes no obligation to publicly update or revise any forward-looking statements.

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For more information please contact:

Gerard T. Feeney, CFO
Wave Systems Corp.