The original deal between the two companies was a stock swap. Motorola acquired the company in exchange for 6.5 million of its own shares. But since that time a meltdown in the telecommunications sector, and for Motorola in particular, has gone from bad to worse, forcing the two companies to rework the terms of deal.
The acquisition could be significant for Motorola as it attempts to expand its line of wireless technology products.
A clause in the deal, originally announced in February, allowed Blue Wave to nix the deal if Motorola's share price dipped below $20.77. If the stock price rose to above $25 per share, Motorola would hand over a figure less than 6.5 million shares.
Motorola's stock price dipped below $20 less than two weeks after the original deal's terms were signed. It was trading at less than $15 per share Wednesday.
Motorola will now hand over 7.25 million shares to Blue Wave, according to a filing with the Securities and Exchange Commission. The two sides also eliminated any way for Motorola or Blue Wave to nix the deal based on changes in the stock price.
The deal was once valued around $165 million. But with the changes, that number dips to $135 million, according to the SEC filings.
The SEC will review the new deal's terms, according to a statement from Motorola.
"We felt this was the best resolution of this deal, given market conditions," a Blue Wave spokesman said.
The Blue Wave deal is expected to close by the end of Motorola's fiscal third quarter. Blue Wave, which makes hardware used to set up wireless systems, last week reported record net sales for its third fiscal quarter of $11.1 million, which was up 21 percent from the same quarter last year.
"The long-term changes occurring in the telecommunications industry still make this a necessary combination, but we obviously needed to address shareholder value in light of current market conditions," Rob Shaddock, chief executive of Blue Wave, said in a statement.