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Michael D. Braun (l 67416)BRAUN LAW GROUP, P .C.12400 Wilshire Blvd .Suite 920Los Angeles, CA 90025Tel: 310 442-7755"Fax : _ 442-7756E-mail : serv s:ef@,braunlawLroui3 -.com

Michael A. SwickKim E. MillerKAHN GAUTHIER SWICK, LLC114 E. 39 `h Stree tNew York NY 10016Tel : 21 920-4310Fax : (504) 455-149 8

Lewis KahnKAHN GAUTHIER650 Poydras StreetNew Orleans LA ITel: (504) 455-14Fax : (504) 455-1 4

Counsel for Plainti

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111h1200t'f JCENTRAL DISTRICT OF CALIFORNIAY DEPUTY

UNITE!) STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

SOUTHERN DIVISION

JERRY MICHAEL CRAFTON,Individually and On Behalf of AllOthers Similarly Situated ,

Plaintiffs,

vs .

POWERWAVE TECHNOLOGIES,INC : BRUCE C. EDWARDSRONALD J . BUSCHUR ANI5KEVIN T. MICHAELS,

"BY FAP6ACV07 - 65 DOC (MLGx)

CASE NO. :

CLASS ACTIO N

CLASS ACTON COMPLAINT FORVIOLATIONS OF FEDERALSECURITIES LAWS

JURY TRIAL DEMANDED

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INTRODUCTION

This is a federal class action on behalf of purchasers of the common stock of

Powerwave Technologies, Inc . ("Powerwave" or the "Company") between May 2,

2005 and October 9, 2006 , inclusive (the "Class Period"), seeking to pursue

remedies under the Securities Exchange Act of 1934 (the "Exchange Act") . As

alleged herein, defendants published a series of materially false and misleading

statements which defendants knew and/or deliberately disregarded were false and

materially misleading at the time of such publication, and which omitted to reveal

material information necessary to make defendants' statements, in light of such

material omissions, not materially false and misleading .

OVERVIEW

1 . Throughout the Class Period, Powerwave was a Company that operated a s

a global supplier of end-to-end wireless solutions for wireless communications

networks. The Company designs, manufactures and markets antennas, and other

wireless communications products such as power amplifiers and advanced coverage

solutions, all for use in cellular, PCS and 3G networks throughout the world .

2. Throughout the Class Period, Powerwave presented itself as a company tha t

was growing both through organic sales growth, as well as through controlled growth

by acquisitions . Based on the purported success of this two-part growth formula, during

the Class Period, defendants repeatedly reported "record" setting revenue growth and

profitability . Thereafter, as shares of the Company traded higher - - trading from

approximately $8 .00 per share at the inception of the Class Period to a high of over

$15 .00 per share by February 2006 - - defendants also registered millions of shares of

freshly-minted Company stock that defendants then used to acquire even more assets .

3 . During the Class Period, as defendants led investors to believe that

Powerwave was achieving these record-setting revenues, defendants repeatedly issue d

guidance to investors that included quarterly revenue guidance of over $250 million pe r

quarter. At all times throughout the Class Period, however, defendants were well aware

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1 that the Company was not operating according to plan and that the integration of the

2 Company's acquired assets was costing much more than expected, these problems were

3 distracting management and they were not producing expected synergies . As defendants

4 knew but did not disclose, throughout the Class Period, the cost of integrating the

5 Company's acquired assets was running well above their expectations .

6 4. In addition, because defendants were also having difficulty implementing

7 new software and management systems, throughout the Class Period, defendants were

8 also well aware that the Company lacked significant internal controls and operational

9 procedures. Thus, defendants' representations concerning the Company's internal

10 systems and controls were also either patently untrue, or these systems were providing

11 defendants with information throughout the Class Period which they knew or

12 deliberately disregarded, was in stark contrast to the statements concerning the

13 Company's strength and profitability .

14 5. Accordingly, unbeknownst to investors, throughout the Class Period, the

15 Company was suffering from a host of undisclosed adverse factors which were

16 negatively impacting its business and which would cause it to report declining financial

17 results, materially less than the market expectations defendants had caused and

18 cultivated. In particular :

19 * At all times during the Class Period, the Company's purported

20 "success" was not the result of its integration of acquisitions or

21 defendants' competent management. Instead, throughout the Class

22 Period, defendants had propped up the Company's results by

23 manipulating Powerwave's accounting for operating and integration

24 expenses, or by otherwise manipulating the Company's revenue

25 recognition and/or inventory policies so as to effectively generate

26 revenues in current periods, that had the effect of negatively

27 impacting the revenues that could be generated in near-term future

28 periods.

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1 * At all times during the Class Period, unbeknownst to investors,

2 defendants had materially overstated Powerwave's profitability by

3 underreporting its rising and foreseeable expenses and integration

4 and acquisition costs, and by failing to make proper, timely

5 adjustments to the Company's reserves .

6

7 * Throughout the Class Period, Powerwave did not have adequate

8 systems of internal operational or financial controls, and as a result

9 its operational reports and financial statements were not true,

10 accurate or reliable .

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12 * As a result of the foregoing, throughout the Class Period, the

13 Company's financial statements and reports were not prepared in

14 accordance with GAAP and SEC rules .

15

16 * As a result of the aforementioned adverse conditions which

17 defendants failed to disclose, throughout the Class Period,

18 defendants lacked any reasonable basis to claim that Powerwave was

19 operating according to plan, or that Powerwave could achieve

20 guidance sponsored and/or endorsed by defendants .

21

22 6. It was only at the end of the Class Period that investors ultimately learned

23 that the Company was operating far below expectations and that Powerwave could

24 suddenly no longer produce revenues necessary to support its large acquisition costs and

25 expenses. In fact, on October 9, 2006, when defendants reported results for the third

26 quarter of 2006, investors first learned that the Company could achieve revenues of only

27 $155 million for the quarter - - and not the $230 to $250 million previously forecast .

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7 . These sudden and shocking disclosures had an immediate impact on th e

price of Powerwave stock and shares of the Company declined almost 20% in the singl e

trading day. This decline marked a loss of almost $10 .00 per share, compared to the

Class Period trading high for Powerwave stock reached only months before .

8. As investors ultimately learned, defendants were motivated to and di d

conceal the true operational and financial condition of Powerwave, and materially

misrepresented and failed to disclose the conditions that were adversely affecting

Powerwave throughout the Class Period, because this enabled defendants to : (i) deceive

the investing public regarding Powerwave's business, operations, management and the

intrinsic value of Powerwave common stock ; (ii) artificially inflate the price of

Powerwave's shares (iii) register for sale with the SEC millions of shares of Company

stock that they then either sold to the public or used to acquire the assets of other,

unwitting companies; (iv) make it possible for Powerwave insiders to sell millions of

dollars of their privately held Powerwave shares while in possession of material adverse

non-public information about the Company; and (v) cause plaintiff and other members

of the Class to purchase Powerwave common stock at artificially-inflated prices .

JURISDICTION AND VENU E

9. The claims asserted herein arise under and pursuant to Sections 10(b) an d

20(a) ofthe Exchange Act [15 U.S.C. §§ 78j(b) and 78t(a)] and Rule I Ob-5 promulgated

thereunder by the United States Securities and Exchange Commission ("SEC") [1 7

C.F.R. § 240.10b-5] .

10. This Court has jurisdiction over the subject matter of this action pursuan t

to 28 U.S .C . §§ 1331 and 1337, and Section 27 of the Exchange Act [15 U.S .C . § 78aa] .

11 . Venue is proper in this District pursuant to Section 27 of the Exchange Act ,

and 28 U.S .C . § 1391(b) . Powerwave maintains its principal place of business in this

District and many of the acts and practices complained of herein occurred in substantia l

part in this District .


1 12. In connection with the acts alleged in this complaint, defendants, directly

2 or indirectly, used the means and instrumentalities of interstate commerce, including,

3 but not limited to, the mails, interstate telephone communications and the facilities of

4 the national securities markets .

5 PARTIES

6 13. Plaintiff Jerry Michael Crafton , as set forth in the accompanying

7 certification, incorporated by reference herein, purchased the common stock of

8 Powerwave at artificially- inflated prices during the Class Period and has been damaged

9 thereby.

10 14. Defendant Powerwave Technologies, Inc . is a Delaware corporation with

11 its principal place of business at 1801 Estandrew Place, Santa Ana, CA 92705 .

12 According to the Company's profile, Powerwave purports to be a global supplier of end-

13 to-end wireless solutions for wireless communications networks. The Company designs,

14 manufactures and markets antennas, boosters, combiners, filters, repeaters, multi-carrier

15 RF power amplifiers and tower-mounted amplifiers and advanced coverage solutions,

16 all for use in cellular, PCS and 3G networks throughout the world .

17 15. Defendant Bruce C . Edwards ("Edwards") was, during the Class Period,

18 Executive Chairman of the Board of Directors of the Company . During the Class

19 Period, defendant Edwards signed the Company's SEC filings, including but not limited

20 to Powerwave's Form(s) 10-Q and Form 10-K and/or the materially false and misleading

21 SEC registration filings made in connection with the Company's stock sales and stock-

22 based acquisitions .

23 16. Defendant Ronald J. Buschur ("Buschur") was, during the Class Period,

24 Chief Executive Officer, President and a member of the Board of Directors of the

25 Company. During the Class Period, defendant Buschur signed the Company's SEC

26 registration filings, including but not limited to Powerwave's Form(s) 10-Q and Form

27 10-K and/or the materially false and misleading SEC filings made in connection with

28 the Company's stock sales and stock-based acquisitions .

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1 17. Defendant Kevin T. Michaels ("Michaels") was, during the Class Period,

2 Chief Financial Officer, Principal Accounting Officer and Senior . Vice President in

3 charge of Finance for the Company. During the Class Period, defendant Michaels

4 signed the Company's SEC filings, including but not limited to Powerwave's Form(s)

5 10-Q and Form 10-K and/or the materially false and misleading SEC registration filings

6 made in connection with the Company's stock sales and stock-based acquisitions .

7 18. The defendants referenced above in ¶¶ 15 - 17 are referred to herein as the

8 "Individual Defendants ."

9 19. Because of the Individual Defendants' positions with the Company, they

10 had access to the adverse undisclosed information about its business, operations,

11 products, operational trends, financial statements, markets and present and future

12 business prospects via access to internal corporate documents (including the Company's

13 operating plans, budgets and forecasts and reports of actual operations compared

14 thereto), conversations and connections with other corporate officers and employees,

15 attendance at management and Board of Directors meetings and committees thereof and

16 via reports and other information provided to them in connection therewith .

17 20. It is appropriate to treat the Individual Defendants as a group for pleading

18 purposes and to presume that the false, misleading and incomplete information conveyed

19 in the Company's public filings, press releases and other publications as alleged herein

20 are the collective actions of the narrowly-defined group of defendants identified above .

21 Each of the above officers of Powerwave, by virtue of their high-level positions with the

22, Company, directly participated in the management of the Company, was directly

23 involved in the day-to-day operations of the Company at the highest levels and was

24 privy to confidential proprietary information concerning the Company and its business,

25 operations, products, growth, financial statements, and financial condition, as alleged

26 herein. Said defendants were involved in drafting, producing, reviewing and/or

27 disseminating the false and misleading statements and information alleged herein, were

28 aware, or deliberately disregarded, that the false and misleading statements were being

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1 issued regarding the Company, and approved or ratified these statements, in violation

2 of the federal securities laws .

3 21. As officers and controlling persons of a publicly-held company whose

4 common stock was, and is, registered with the SEC pursuant to the Exchange Act, and

5 was traded on the Nasdaq National Market Exchange (the "Nasdaq"), and governed by

6 the provisions of the federal securities laws, the Individual Defendants each had a duty

7 to disseminate promptly, accurate and truthful information with respect to the

8 Company's financial condition and performance, growth, operations, financial

9 statements, business, products, markets, management, earnings and present and future

10 business prospects, and to correct any previously-issued statements that had become

11 materially misleading or untrue, so that the market price of the Company's publicly-

12 traded common stock would be based upon truthful and accurate information . The

13 Individual Defendants' misrepresentations and omissions during the Class Period

14 violated these specific requirements and obligations .

15 22. The Individual Defendants participated in the drafting, preparation, and/or

16 approval of the various public and shareholder and investor reports and other

17 communications complained of herein and were aware of, or deliberately disregarded,

18 the misstatements contained therein and omissions therefrom, and were aware of their

19 materially false and misleading nature. Because of their Board membership and/or

20 executive and managerial positions with Powerwave, each of the Individual Defendants

21 had access to the adverse undisclosed information about Powerwave's business

22 prospects and financial condition and performance as particularized herein and knew (or

23 deliberately disregarded) that these adverse facts rendered the positive representations

24 made by or about Powerwave and its business issued or adopted by the Company

25 materially false and misleading.

26 23. The Individual Defendants, because of their positions of control and

27 authority as officers and/or directors of the Company, were able to and did control the

28 content of the various SEC filings, press releases and other public statements pertaining

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1 to the Company during the Class Period . Each Individual Defendant was provided with

2 copies of the documents alleged herein to be misleading prior to or shortly after their

3 issuance and/or had the ability and/or opportunity to prevent their issuance or cause

4 them to be corrected . Accordingly, each of the Individual Defendants is responsible for

5 the accuracy of the public reports and releases detailed herein and is therefore primarily

6 liable for the representations contained therein .

7 24. Each of the defendants is liable as a participant in a fraudulent scheme and

8 course of business that operated as a fraud or deceit on purchasers of Powerwave

9 common stock by disseminating materially false and misleading statements and/or

10 concealing material adverse facts . The scheme : (i) deceived the investing public

11 regarding Powerwave's business, operations, management and the intrinsic value of

12 Powerwave common stock ; (ii) enabled defendants to artificially inflate the price of

13 Powerwave's shares ; (iii) enabled defendants to register for sale with the SEC, millions

14 of shares of Company stock, that they then either sold to the public or used to acquire

15 the assets of other, unwitting companies ; (iv) enabled Powerwave insiders to sell

16 millions of dollars of their privately held Powerwave shares while in possession of

17 material adverse non-public information about the Company ; and (v) caused plaintiff

18 and other members of the Class to purchase Powerwave common stock at artificially-

19 inflated prices .

20 PLAINTIFF'S CLASS ACTION ALLEGATIONS

21 25. Plaintiff brings this action as a class action pursuant to Federal Rule of

22 Civil Procedure 23(a) and (b)(3) on behalf of a Class, consisting of all those who

23 purchased or otherwise acquired the common stock ofPowerwave between May 2, 2005

24 and October 9, 2006, inclusive (the "Class") and who were damaged thereby .

25 Excluded from the Class are defendants, the officers and directors of the Company, at

26 all relevant times, members of their immediate families and their legal representatives,

27 heirs, successors or assigns and any entity in which defendants have or had a controlling

28 interest.

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1 26. The members of the Class are so numerous that joinder of all members is

2 impracticable . Throughout the Class Period, Powerwave common shares were actively

3 traded on the Nasdaq. As of August 4, 2006, the Company had over 112 .54 million

4 shares of common stock issued and outstanding . While the exact number of Class

5 members is unknown to plaintiff at this time and can only be ascertained through

6 appropriate discovery, plaintiff believes that there are hundreds or thousands of

7 members in the proposed Class . Record owners and other members of the Class may

8 be identified from records maintained by Powerwave or its transfer agent and may be

9 notified of the pendency of this action by mail, using the form of notice similar to that

10 customarily used in securities class actions .

11 27. Plaintiff's claims are typical of the claims of the members of the Class as

12 all members of the Class are similarly affected by defendants' wrongful conduct in

13 violation of federal law that is complained of herein .

14 28. Plaintiff will fairly and adequately protect the interests of the members of

15 the Class and has retained counsel competent and experienced in class and securities

16 litigation .

17 29. Common questions of law and fact exist as to all members of the Class and

18 predominate over any questions solely affecting individual members of the Class .

19 Among the questions of law and fact common to the Class are :

20 a. whether the federal securities laws were violated by defendants' acts

21 as alleged herein;

22 b. whether statements made by defendants to the investing public

23 during the Class Period misrepresented material facts about the business, operations and

24 management of Powerwave; and

25 c. to what extent the members ofthe Class have sustained damages and

26 the proper measure of damages .

27 30. A class action is superior to all other available methods for the fair and

28 efficient adjudication of this controversy since joinder of all members is impracticable .

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1 Furthermore, as the damages suffered by individual Class members may be relatively

2 small, the expense and burden of individual litigation make it impossible for members

3 of the Class to individually redress the wrongs done to them. There will be no difficulty

4 in the management of this action as a class action .

5 SUBSTANTIVE ALLEGATIONS

6 Defendants ' Materially False and MisleadingStatements Made During the Class Period

7

8 31. 1Q : 05 Results . On May 2, 2005, the inception of the Class Period,

9 Powerwave published a release announcing results for the fiscal first quarter ended April

10 3, 2005 . This release stated, in part, the following :

11 Powerwave Technologies Reports First Quarter Results

1 2

13 SANTA ANA, Calif., May 02, 2005 - Powerwave Technologies, Inc .

14 (NASDAQ:PWAV) today reported net sales of $162 .2 million for its first

15 quarter ended April 3, 2005, compared to first quarter fiscal 2004 revenues

16 of $63 .2 million. Powerwave also reported first quarter net income of $5 .4

17 million, which includes a total of $3 .9 million of acquisition related

18 intangible asset amortization and a one-time charge of $0 .4 million related

19 to the allocation of a portion of the purchase price associated with

20 Powerwave's acquisition of certain assets of Kaval Wireless to in-process

21 research and development expenses . The net income equates to fully

22 diluted earnings per share of 5 cents for the first quarter, and a basic

23 earnings per share of 5 cents for the same period . This compares to a net

24 loss of $3.3 million, or a basic loss per share of 5 cents for the prior year

25 period. Powerwave completed the acquisition of LGP Allgon Holding AB

26 during the second quarter of 2004 and therefore the results reported herein

27 include the results of LGP Allgon Holding AB for the entire first quarter

28 of fiscal year 2005, but are not included in the first quarter of 2004 .

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1 Powerwave completed the acquisition of certain assets of Kaval Wireless

2 on February 9, 2005, and the results reported herein include the results for

3 Kaval Wireless from February 9, 2005 through April 3, 2005. For the first

4 quarter of fiscal 2005, excluding the acquisition related charges and

5 intangible asset amo rtization, Powerwave would have repo rted operating

6 income of $ 10 .4 million, net income after taxes of $9 .0 million and diluted

7 earnings per share of 8 cents .

8

9

10 Balance Sheet

11

12 At April 3, 2005 , Powerwave had total cash and cash equivalents of $275 .7

13 million , which includes restricted cash of $6 .8 million . Total net

14 inventories were $61 .2 million and net accounts receivable were $148 .9

15 million.

16

17 32. In addition to the foregoing, the Company ' s May 2, 2005 release quoted

18 defendant Buschur , in part, as follows:

19 "For this first quarter of our fiscal year, we are proud to report

20 sequential quarterly revenue growth and the largest revenue quarter in

21 Powerwave 's history," stated Ronald Buschur, President and Chief

22 Executive Officer of Powerwave Technologies . "This excellent

23 performance by our worldwide Powerwave team took place during the

24 first quarter, which is normally a slow period in the wireless

25 infrastructure industry . We believe that we are off to a strong start for

26 2005 and clearly we are recognizing the benefits from our acquisition of

27 LGP Aligon as well as realizing the synergies of our combined global

28 organization. During the first quarter, we further strengthened our

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1 portfolio of infrastructure products and services for the wireless

2 communications industry through our purchase of Kaval Wireless, a

3 leading supplier of in-building wireless coverage solutions . We believe

4 that the Powerwave suite of global wireless infrastructure products and

5 services is enabling us to enhance our leadership position in both the OEM

6 and direct to operator markets. We remain extremely positive with regards

7 to our longer term outlook for increasing demand within the wireless

8 communications infrastructure industry." [Emphasis added . ]

9

10 33. Following the publication of the Company's earnings announcement and

11 forward guidance, the price of Powerwave rallied - - trading from a close of $7 .22 per

12 share on April 28, 2005, to a close of $8 .36 per share the following trading day on May

13 3, 2005 - - a single day increase of almost 15% .

14 34. Analyst Presentations . As shares of the Company traded higher, in mid-

15 May 2005, Powerwave announced that defendants would participate in a series of

16 analyst and investor conferences . These conferences included: (i) the Baird 2005

17 Growth Stock Conference in Chicago, Illinois, May 10, 2005 ; (ii) the CIBC Annual

18 Communications & Technology Conference in New York City, May 11, 2005 ; (iii) the

19 Piper Jaffray Technology Conference in New York City, May 12, 2005 ; (iv) the JP

20 Morgan Technology Conference in San Francisco, California May 19, 2005 ; and (v) the

21 Lehman Brothers 2005 Worldwide Wireless and Wireline Conference in New York

22 City, June 2, 2005 . At each of these conferences, defendants reviewed Powerwave's

23 purported wireless strategy, its financial results, market opportunities, growth forecasts

24 and historical financial results .

25 35. 1Q :05 Form 10-Q. On or about May 13, 2005, defendants filed with the

26 SEC the Company's 1Q:05 Form 10-Q for the quarter ended April 3, 2005, signed

27 and/or certified by defendants Michaels and Buschur. In addition to making

28 substantially similar statements concerning the Company operations and financial

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condition as had been made previously by defendants and published in the Company' s

May 2, 2005 release, the 1Q :05 Form 10-Q also stated, in part, the following :

Note 2. Summary of Significant Accounting Policie s

Basis of Presentatio n

The accompanying condensed consolidated financial statements of

Powerwave have been prepared in accordance with accounting principles

generally accepted in the United States of America for interim financia l

information and in accordance with the instructions to Form 10-Q and

Article 10 of Regulation S-X . . . . The interim financial information is

unaudited, but reflects all normal adjustments and accruals, which are, in

the opinion of management, considered necessary to provide a fair

presentation for the interim periods presented. All intercompany balances

and transactions have been eliminated in the accompanying consolidate d

financial statements . Certain prior period amounts have been reclassified

to conform to the current period presentation . '

36. Controls & Procedures . The 1Q :05 Form 10-Q also contained statements

that attested to the purported sufficiency and adequacy of the Company's internal

financial controls and operational procedures . In this regard, the 1Q :05 Form 10-Q

~ stated, in part, the following :

' During the second quarter of fiscal 2004, Powerwave completed its

acquisition of LGP Allgon. Therefore, these condensed consolidated financial

statements include the operations of LGP Allgon for the entire first quarter of fiscalyear 2005, but such results are not included in the first quarter of fiscal year 2004 .

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ITEM 4. CONTROLS AND PROCEDURE S

Controls and Procedures

We have established disclosure controls and procedures to ensure that

material information relating to Powerwave and its consolidated

subsidiaries is made known to the officers who certify the Company's

financial reports, as well as other members of senior management and

the Board of Directors, to allow timely decisions regarding required

disclosures . As of the end of the period covered by this report, Powerwav e

carried out an evaluation, under the supervision and with the participation

of the Company's management, including the Company's Chief Executive

Officer and Chief Financial Officer, of the effectiveness of the design and

operation of the Company's disclosure controls and procedures pursuan t

to Rule 13a-15 of the Securities and Exchange Act of 1934 . Based upon

that evaluation, the Chief Executive Officer and Chief Financial Officer

concluded that the Company 's disclosure controls and procedures are

effective in timely alerting them to material information related to the

Company that is required to be included in Powerwave's annual an d

periodic SEC filings.

Internal Control Over Financial Reportin g

There has been no change in the Company's internal control over

financial reporting during the first fiscal quarter that has materially

affected, or is reasonable likely to materially affect, the Company's internal

control over financial reporting . [Emphasis added . ]

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1 37. Certifications . In addition to the foregoing, the Company's 1 Q :05 Form

2 10-Q also contained certifications by defendants Buschur and Michaels that attested to

3 the purported accuracy and completeness of the Company's financial and operational

4 reports, as follows:

5 CEO CERTIFICATION / CFO CERTIFICATION

67 1. I have reviewed this report on Form 10-Q of Powerwave

8 Technologies, Inc. (the "Registrant") ;

9

10 2. Based on my knowledge, this report does not contain any

11untrue statement of a material fact or omit to state a material fact

12 necessary to make the statements made, in light . of the circumstances

13under which such statements were made, not misleading with respect to

14theperiod covered by this report;

15

163 . Based on my knowledge, the financial statements, and other

17 financial information included in this report, fairly present in all

1 g material respects the financial condition, results ofoperations and cash

19flows of the Registrant as of,, and for, the periods presented in this report;

20

21 4. The Registrant's other certifying officer and I are responsible

22 for establishing and maintaining disclosure controls and procedures (as

23 defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal

24 control over financial reporting (as defined in Exchange Act Rules 13a-

25 15(f) and 15d-15(f)) for the Registrant and have :

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27 (a) Designed such disclosure controls and procedures, or caused

28 such disclosure controls and procedures to be designed under ou r

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1 supervision, to ensure that material information relating to the

2 Registrant, including its consolidated subsidiaries, is made known to us

3 by others within those entities, particularly during the period in which

4 this report is beingprepared;

5

6 (b) Designed such internal control over financial reporting, or

7 caused such internal control over financial reporting to be designed

8 under our supervision , to provide reasonable assurance regarding the

9 reliability of financial reporting and the preparation of financial

10 statementsfor externalpurposes in accordance with generally accepted

11 accounting principles;

12

13 (c) Evaluated the effectiveness of the Registrant 's disclosure

14 controls and procedures and presented in this report our conclusions

15 about the effectiveness of the disclosure controls and procedures, as of

16 the end of the period covered by this report based on such evaluation;

17 and

18

19 (d) Disclosed in this report any change in the Registrant's internal

20 control over financial reporting that occurred during the Registrant's most

21 recent fiscal quarter that has materially affected, or is reasonably likely to

22 materially affect, the Registrant 's internal control over financial reporting;

23 and

24

25 5. The Registrant's other certifying officer and I have disclosed,

26 based on our most recent evaluation of internal control over financial

27 reporting, to the Registrant's auditors and the audit committee of the

28 Registrant's board of directors :

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1 (a) All significant deficiencies and material weaknesses in the

2 design or operation of internal control over financial reporting which

3 are reasonably likely to adversely affect the Registrant 's ability to record,

4 process, summarize and report financial information ; and

5

6 (b) Any fraud, whether or not material, that involves management

7 or other employees who have a significant role in the Registrant ' s internal

8 control over financial reporting.

9

10 Date: May 13, 2005

1 1

12 By: /s/ RONALD J. BUSCHUR

13 Ronald J . Buschur

14 President and Chief Executive Officer

15 Powerwave Technologies, Inc .

16

17 * *

1 8

19 Date : May 13, 2005

20

21 By: /s/ KEVIN T. MICHAELS

22 Kevin T. Michaels

23 Senior Vice President , Finance and

24 Chief Financial Officer


26

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CEO CERTIFICATION OF PERIODIC REPORT

I, Ronald J. Buschur, Chief Executive Officer of Powerwave

Technologies, Inc. (the "Company"), certify, pursuant to Section 906 ofthe

Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that :

1 . the Quarterly Report on Form 10-Q of the Company for the

quarterly period ended April 3, 2005 (the "Report") fully complies with the

requirements of Section 13(a) or 15(d) of the Securities Exchange Act of

1934 (15 U.S .C . 78m or 780(d)); and

2. the information contained in the Report fairly presents, in

all material respects, the financial condition and results of operations of

the Company.

Date:

May 13, 200 5

By : /s/ RONALD J. BUSCHUR

Ronald J. Buschur

President and Chief Executive Officer

Powerwave Technologies, Inc .

CFO CERTIFICATION OF PERIODIC REPORT

I, Kevin T. Michaels, Senior Vice President, Finance and Chief Financial

Officer of Powerwave Technologies, Inc. (the "Company"), certify,

pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U .S .C.

Section 1350, that :

18\\Fileserver\sha reddocs\BLG\POW ERWAVE\PLD-W PD\Complaint .wpd

1 1. the Quarterly Report on Form 10-Q of the Company for the

2 quarterly period ended April 3, 2005 (the "Report") fully complies with the

3 requirements of Section 13(a) or 15(d) of the Securities Exchange Act of

4 1934 (15 U.S.C. 78m or 780(d)) ; and

5

6 2. the information contained in the Report fairly presents, in

7 all material respects, the financial condition and results of operations of

8 the Company.

9

10 Date : May 13, 2005



13 Senior Vice President, Finance and

14 Chief Financial Office r


1 6

17 38. The statements contained in Powerwave's May 2, 2005 release and those

18 statements contained in the Company's IQ : 05 Form 10-Q, referenced above, were each

19 materially and misleading when made and were known by defendants to be false at that

20 time, or were deliberately disregarded as such thereby, for the following reasons, among

21 others :

22 (a) At all times during the Class Period, it was not true that the

23 Company's purported success was the result of its integration of

24 acquisitions or defendants' competent management when, in fact,

25 throughout the Class Period, defendants had propped up the Company's

26 results by manipulating Powerwave's accounting for operating and

27 integration expenses, or by otherwise manipulating the Company's revenue

28 recognition or inventory policies so as to effectively generate revenues in

1 9\\Filese rver\sha reddocs \BLG\POW ERWAVE\PLD-W P D \Compla int.wpd

1 current periods, that had the effect of negatively impacting the revenues

2 that could be generated in near-tenn future periods ;

3 (b) At all times during the Class Period, unbeknownst to

4 investors, defendants had materially overstated the Company's profitability

5 by underreporting Powerwave's rising and foreseeable expenses and

6 integration and acquisition costs, and by failing to make proper, timely

7 adjustments to the Company's stated reports ;

8 (c) Throughout the Class Period, Powerwave did not have

9 adequate systems of internal operational or financial controls, and as a

10 result Powerwave's operational reports and financial statements were not

11 true, accurate or reliable;

12 (d) As a result of the foregoing, throughout the Class Period, the

13 Company's financial statements and reports were not prepared in

14 accordance with GAAP ad SEC rules ; and

15 (e) As a result of the aforementioned adverse conditions which

16 defendants failed to disclose, throughout the Class Period, defendants

17 lacked any reasonable basis to claim that Powerwave was operating

18 according to plan, or that Powerwave could achieve guidance sponsored

19 and/or endorsed by defendants .

20 39. On July 12, 2005, defendants filed with the SEC a Registration Statement

21 pursuant to Form S-4, in connection with the registration of 10 million shares of

22 Company stock used to acquire the wireless assets of REMEC, a transaction previously

23 announced on March 14, 2005 . In addition to making many of the same or substantially

24 similar materially false and misleading statements about the Company, its operations

25 and its finances, as had been made by defendants previously, this Form S-4 stated in

26 part, the following :

27

28

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1 Powerwave's offer to purchase the selected wireless assets of REMEC

2 reflects its strategy to expand its position within the wireless infrastructure

3 marketplace while expanding its customer base . Powerwave believes this

4 acquisition will enable it to significantly expand its RF conditioning

5 product lines, filter products, as well as complement its existing tower

6 mounted amplifier products . With this acquisition, Powerwave believes

7 that it will be able to further leverage one of the broadest portfolios of

8 products and services in the wireless infrastructure industry to bolster its

9 position in both OEM and network operator channels . In addition,

10 Powerwave believes that it will be able to achieve significant cost

11 synergies while leveraging its increased global purchasing power .

12

13 40. 2Q:05 Results : "Record " Revenues . On July 28, 2005, Powerwave

14 published a release announcing results for the fiscal second quarter ended July 3, 2005 .

15 This release also stated, in part, the following :

16 Powerwave Technologies Reports Second Quarter Results

1 7

18 SANTA ANA, Calif., July 28, 2005 - Powerwave Technologies, Inc .

19 (NASDAQ:PWAV) today reported net sales of $186 .3 million for its

20 second quarter ended July 3, 2005, compared to second quarter fiscal 2004

21 revenues of $116.0 million. Powerwave also reported second quarter net

22 income of $13 .0 million, which includes a total of $3 .7 million of

23 acquisition related intangible asset amortization. The net income equates

24 to diluted earnings per share of 11 cents for the second quarter, and a basic

25 earnings per share of 13 cents for the same period . This compares to a net

26 loss of $30.2 million, or a basic and diluted loss per share of 33 cents for

27 the prior year period. Powerwave completed the acquisition of LGP

28 Allgon Holding AB during the second quarter of 2004 and, therefore, the

2 1\\Fi leserver\sha reddocs\BLG\POW E RWAVE \PLD-W PD\Compla int.wpd

1 results reported herein include the results of LGP Allgon Holding AB for

2 the entire second quarter of fiscal year 2005, but only include the months

3 of May and June 2004 in the second quarter of 2004 . For the second

4 quarter of fiscal 2005, excluding the acquisition related intangible asset

5 amortization, Powerwave would have reported operating income of $14 .8

6 million, net income after taxes of $16.4 million and diluted earnings per

7 share of 14 cents .

8

9

10 Balance Sheet

11

12 At July 3, 2005, Powerwave had total cash and cash equivalents of $284.0

13 million, which includes restricted cash of $6.5 million. Total net


15 million.

16

17 41. In addition to the foregoing, the Company's July 28, 2005 release quoted

18 defendant Buschur, in part, as follows :

19 "For our second quarter, we are proud to report sequential quarterly

20 revenue and income growth and, once again , a record revenue quarter

21 for Powerwave," stated Ronald Buschur , President and Chief Executive

22 Officer of Powerwave Technologies . "As we stated previously, we believe

23 that we are off to a strong startfor 2005 and we are very excited about

24 the increased demand we are experiencing within the wireless

25 communications infrastructure industry. While we continue to work to

26 improve the synergies of ourglobal organization , we are poised to build

27 upon our market leadingposition andproductportfolio with thepending

28 acquisition of the selected assets of REMEC 's Wireless business . We

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1 believe that the addition of REMEC's wireless product portfolio to

2 Powerwave's existing suite of global wireless infrastructure products and

3 services will further enhance our leadership position in both the OEM and

4 direct to operator markets ." [Emphasis added .]

56 42. 2Q : 05 Form 10-Q. On or about August 12, 2005, defendants filed with

7 the SEC the Company's 2Q :05 Form 10-Q, for the quarter ended July 3, 2005, signed


9 substantially similar statements concerning the Company's operations and financial

10 condition as had been made by defendants previously and published in the Company's

11 May 2, 2005 release, the 2Q:05 Form 10-Q also stated, in part, the following :

12 Basis of Presentation

1 3

14The accompanying condensed consolidatedfinancial statements of

15Powerwave have been prepared in accordance with accounting

16principles generally accepted in the United States of America for

17 interim financial information and in accordance with the instructions to

18 Form 10-Q and Article 10 of Regulation S-X . Accordingly, they do not

19 include certain footnotes and financial presentations normally required

20 under accounting principles generally accepted in the United States of

21 America for complete financial reporting . The interim financial

22 information is unaudited, but reflects all normal adjustments and

23 accruals, which are, in the opinion of management, considered

24 necessary to provide a fairpresentationfor the interim periods

25 presented. All intercompany balances and transactions have been

26 eliminated in the accompanying consolidated financial statements .

27 Certain prior period amounts have been reclassified to conform to the

28 current period presentation .

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During the second quarter of fiscal 2004, Powerwave completed its

acquisition of LGP Allgon. Therefore, these condensed consolidated

financial statements include the operations of LGP Allgon from May 2004

forward. [Emphasis added .]

43 . Controls & Procedures . The 2Q:05 Form 10-Q also contained statements

that attested to the purported sufficiency and adequacy of the Company 's internal

financial controls and operational procedures . In this regard, the 2Q :05 Form 10-Q

I stated, in part, the following :

ITEM 4. CONTROLS AND PROCEDURES




subsidiaries is made known to the officers who certify the Company's

financial reports, as well as other members of senior management an d


disclosures . As of the end of the period covered by this report ,

Powerwave carried out an evaluation, under the supervision and wit h

the participation of the Company's management, including the

Company's Chief Executive Officer and Chief Financial Officer, of the

effectiveness of the design and operation of the Company's disclosure

controls and procedures pursuant to Rule 13a-15 of the Securities an d

Exchange Act of 1934 . Based upon that evaluation , the Chief

Executive Officer and ChiefFinancial Officer concluded that the

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1 Company's disclosure controls and procedures are effective in timely

2 alerting them to material information related to the Company that is

3 required to be included in Powerwave's annual and periodic SEC

4 filings.

5

6

7

8 Internal Control Over Financial Reportin g

9

10 There has been no change in the Company 's internal control over

11 financial reporting during the first six months of 2005 that has materially

12 affected, or is reasonable likely to materially affect, the Company's internal

13 control over financial reporting . [Emphasis added . ]

14

15 44. Certifications . In addition to the foregoing, the Company's 2Q:05 Form



18 reports, as follows :

19 CEO CERTIFICATION OF PERIODIC REPORT

20

21 I, Ronald J. Buschur , Chief Executive Officer of Powerwave

22 Technologies, Inc . (the "Company"), certify, pursuant to Section 906 ofthe

23 Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that :

24


26 quarterly period ended July 3, 2005 (the "Report") fully complies with the


28 1934 (15 U.S .C . 78m or 780(d)) ; and

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the Company.

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I Date: August 12, 2005


Ronald J. Buschur



CFO CERTIFICATION OF PERIODIC REPORT

I, Kevin T. Michaels , Senior Vice President , Finance and ChiefFinancial

Officer of Powerwave Technologies , Inc . (the "Company"), certify,

pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S .C.

Section 1350, that :

1 . the Quarterly Report on Form 10-Q of the Company for the

quarterly period ended July 3, 2005 (the "Report") fully complies with the


1934 (15 U.S .C . 78m or 780(d)) ; and



the Company.

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1 Date : August 12, 2005


3 Kevin T. Michael s

4 Senior Vice President, Finance and



7 [Emphasis added. ]

8 45. Those statements contained in the Company's July 28, 2005 press release

9 and in Powerwave's 2Q :05 Form 10-Q, were each materially false and misleading when

10 made and were known by defendants to be false at that time, or were deliberately

11 disregarded as such thereby, for the reasons stated herein in ¶ 38, supra .

12 46. 3Q : 05 Results : "Record" Revenues . On November 3, 2005, Powerwave

13 published a release announcing results for the fiscal third quarter ended October 2, 2005 .

14 This release also stated, in part, the following :

15 Powerwave Technologies Reports Third Quarter Results

1 6

17 SANTA ANA, Calif., November 03, 2005 - Powerwave Technologies, Inc .

18 (NASDAQ:PWAV) today reported net sales of $217 .8 million for its third

19 quarter ended October 2, 2005, compared to third quarter fiscal 2004

20 revenues of $138 .3 million. Powerwave also reported third quarter net

21 income of $13 .1 million, which includes a pre-tax total of $5 .7 million of

22 acquisition related charges and expenses, including costs and expenses

23 resulting from a preliminary purchase price allocation of the acquisition of

24 selected assets and liabilities ofREMEC, Inc .'s Wireless Systems Business

25 (the "REMEC Acquisition"), which closed on September 2, 2005 .

26

27

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For the third quarter of 2005, Powerwave's net income equates to diluted

earnings per share of 11 cents, and basic earnings per share of 13 cents for

the same period. This compares to net income of $2 .8 million, or basic an d

diluted earnings per share of 3 cents for the prior year period . . . . For the

third quarter of fiscal 2005, excluding all acquisition related charges and

expenses, Powerwave would have reported operating income of $22 .0

million, net income after taxes of $18 .2 million and diluted earnings per

share of 15 cents .

Balance Sheet

At October 2, 2005, Powerwave had total cash and cash equivalents of

$224 .4 million, which included restricted cash of $6 .6 million. Total net

inventories were $111 .8 million and net accounts receivable were $210 .9

million .

47. The November 3, 2005 release also quoted defendant Buschur who stated ,

in part, the following:

"For our third quarter, we are happy to report the successful completion

of our acquisition of selected wireless assets and liabilitiesfrom REMEC

as well as extremely proud to report sequential quarterly revenue growth

and, once again, a record revenue quarter for Powerwave," stated

Ronald Buschur, President and Chief Executive Officer of Powerwav e

Technologies . "While we are focused on integrating our recent acquisition

of the selected assets and liabilities of REMEC 's wireless business, w e

continue to refine our manufacturing excellence as well as drive additional

synergies and improvements through our global organization . We believe

that we are poised to build upon our market leading position and product

28\\Fileserver\shareddocs\BLG\POWERWAVE\PLD-W PD\Complaint.wpd

1 portfolio with the addition of REMEC's wireless product portfolio to

2 Powerwave 's existing suite ofglobal wireless infrastructure products and

3 services. This will further enhance our leadership position in both the

4 OEM and direct to operator markets ." [Emphasis added.]

5

6 48. 3Q :05 Form 10-Q. On or about November 14, 2005, defendants filed with

7 the SEC the Company's 3Q :05 Form 10-Q for the quarter ended October 2, 2005, signed


9 substantially similar statements concerning the Company operations and financial

10 condition as had been made by defendants previously and published in the Company's

11 November 3, 2005 release, the Company's 3Q :05 Form 10-Q also stated, in part, the

12 following :

13 Basis of Presentation

1 4

15 The accompanying condensed consolidated financial statements of

16 Powerwave have been prepared in accordance with accounting principles

17 generally accepted in the United States ofAmerica for interim financial

18 information and in accordance with the instructions to Form 10-Q and

19 Article 10 of Regulation S-X. Accordingly, they do not include certain

20 footnotes and financial presentations normally required under accounting

21 principles generally accepted in the United States of America for complete

22 financial reporting . The interim financial information is unaudited, but

23 reflects all normal adjustments and accruals, which are, in the opinion

24 of management, considered necessary to provide a fairpresentation for

25 the interim periods presented . All intercompany balances and transactions

26 have been eliminated in the accompanying consolidated financial

27

28

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1 statements. Certain prior period amounts have been reclassified to conform

2 to the current period presentation.2 [Emphasis added .]

3

4 49. Controls & Procedures . The 3Q:05 Form 10-Q also contained statements

5 that attested to the purported sufficiency and adequacy of the Company 's internal

6 financial controls and operational procedures. In this regard, the 3Q:05 Form 10-Q

7 stated, in part, the following :

8 ITEM 4. CONTROLS AND PROCEDURES

9 Controls and Procedures

10

11 We have established disclosure controls and procedures to ensure that

12 material information relating to Powerwave and its consolidated

13 subsidiaries is made known to the officers who certify our financial

14 reports, as well as other members ofsenior management and the Board

15 ofDirectors, to allow timely decisions regarding required disclosures . As

16 of the end of the period covered by this report, we carried out an

17 evaluation, under the supervision and with the participation of our

18 management, including our Chief Executive Officer and Chief Financial

19 Officer, of the effectiveness of the design and operation of our disclosure

20 controls and procedures pursuant to Rule 13a-15 of the Securities and

21 Exchange Act of 1934 . Based upon that evaluation, the ChiefExecutive

22 Officer and Chief Financial Officer concluded that our disclosure

23

24 2 On September 2, 2005, Powerwave completed the acquisition of selectedassets and liabilities of REMEC, Inc .'s Wireless Systems Business (the "REMEC

25 Acquisition") . These condensed consolidated financial statements include th e26 operations of the REMEC Acquisition from September 3, 2005 forward . During the

27 second quarter of fiscal 2004, Powerwave completed its acquisition of LGP Allgon .

Therefore, these condensed consolidated financial statements include the operations

28 of LGP Allgon from May 2004 forward .

30\\Fileserver\shareddocs\BLG\POW ERWAVE \PLD-W PD \Compla int .wpd

1 controls and procedures are effective in timely alerting them to material

2 information related to us that is required to be included in our annual

3 and periodic SEC filings.

4

5

6 Internal Control Over Financial Reportin g7

8 There has been no change in our internal control over financial reporting

9 during the first nine months of 2005 that has materially affected, or is

10 reasonable likely to materially affect, our internal control over financial

11 reporting. [Emphasis added.]

12

13 50. Certifications . In addition to the foregoing, the Company's 3Q :05 Form



16 reports, as follows:

17


1 9

20 I, Ronald J. Buschur , Chief Executive Officer of Powerwave

21 Technologies, Inc. (the "Company"), certify, pursuant to Section 906 ofthe

22 Sarbanes-Oxley Act of 2002, 18 U .S .C. Section 1350, that :

23


25 quarterly period ended October 2, 2005 (the "Report") fully complies with

26 the requirements of Section 13(a) or 15(d) of the Securities Exchange Act

27 of 1934 (15 U.S .C . 78m or 780(d)) ; and

28

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1 2. the information contained in the Reportfairly presents, in

2 all material respects, the f nancial condition and results of operations of

3 the Company.

4 Date: November 11, 2005

5

6 By: /s/ RONALD J. B USCHUR



9 Powerwave Technologies, Inc.

10

11 CFO CERTIFICATION OF PERIODIC REPORT

1 2

13 I, Kevin T. Michaels, Chief Financial Officer of Powerwave


15 Sarbanes-Oxley Act of 2002, 18 U.S .C . Section 1350, that :

16


18 quarterly period ended October 2, 2005 (the "Report") fully complies with

19 the requirements of Section 13(a) or 15(d) of the Securities Exchange Act

20 of 1934 (15 U.S .C . 78m or 780(d)); and

21



24 the Company.

25

26

27

28 ///

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1 Date: November 11, 2005

2

3 By: /s/ K EVIN T. M ICHAELS

4 Kevin T. Michael s




8

9 51. Credit Suisse Presentation . As shares of the Company continued to trade

10 higher, in late November 2005 Powerwave announced that defendants would make a

11 presentation at the Credit Suisse First Boston Annual Technology Conference in

12 Scottsdale, Arizona, on Wednesday, November 30, 2005 . At this Conference,

13 defendants purported to review Powerwave's wireless strategy, its market opportunities,

14 forward guidance and historical financial results .

15 52. The statements made by defendants and contained in the Company's

16 November 3, 2005 press release and in Powerwave's 3Q :05 Form 10-Q, were materially

17 false and misleading and were known by defendants to be false at that time, or were

18 deliberately disregarded as such thereby, for the reasons stated herein in ¶38, supra.

19 53. Taking full advantage of the artificial inflation in the price of Powerwave

20 shares, cased in substantial part as a result of the publication and dissemination of

21 defendants' materially false and misleading information about the Company, between

22 mid-August and early November 2005, insiders raced to the market to liquidate

23 substantial amounts of their personally held Company stock, while in possession of

24 materially false and misleading information, as follows :

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Date Insider Shares Sale Price Per Valu eShare

8-Nov-05 EDWARDS 2000,000 13 .10 2,620,000 .00BRUCE C .Officer

14-Sep-05 MICHAELS 11,250 12.26* 137,925 .00KEVIN T .Officer

12-Sep-05 LEGENDRE 50,000 11 .10 555,000 .0 0ROBERTOfficer

15-Aug-05 EDWARDS 50,613 11 .16 564,841 .00BRUCE C .Officer

54 . 4Q & FY:2004 Results: "Record " Results. On January 31, 2006,

Powerwave published a release announcing results for the fourth quarter and full year

ended January 1, 2006. This release stated, in part, the following :

Powerwave Technologies Reports Fourth Quarter Results

SANTA ANA, Calif., January 31, 2006 - Powerwave Technologies, Inc .

(NASDAQ:PWAV) today reported net sales of $258 .7 million for its

fourth quarter ended January 1, 2006, compared to fou rth quarter fiscal

2004 revenues of $156 .4 million. Powerwave also reported fourth

quarter net income of $19 .2 million, which includes a pre-tax total of

$6.6 million of acquisition related charges and intangible asset

amortization. For the fourth quarter of 2005, Powerwave's net income

equates to diluted earnings per share of 15 cents, and basic earnings pe r

share of 17 cents for the same period . This compares to a net loss o f

$41 .5 million, or basic loss per share of 41 cents for the prior year

period. The net loss for the fourth quarter of 2004 included a $45 .0

million non-cash charge to reflect the recording of a full valuatio n

allowance on Powerwave's US deferred tax assets . . . . . For the fourth

34

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1 quarter of fiscal 2005, excluding all acquisition related charges an d

2 expenses, Powerwave would have reported operating income of $25 . 3

3 million, net income of $22 .9 million and diluted earnings per share of 17

4 cents .

5

6 For the entire fiscal year 2005, Powerwave reported total net sales o f

7 $825.1 million compared with $473 .9 million for all of fiscal year 2004 .

8 Fiscal year 2005 includes the results of LGP Allgon for the entire period

9 while fiscal year 2004 only includes the results of LGP Allgon fro m

10 May 2004. The results of the selected wireless assets of REMEC, Inc .

11 are only included from September 2005 . Powerwave reported total net

12 income for fiscal 2005 of $50 .6 million and diluted earnings per share of

13 42 cents, compared to a net loss of $72.1 million or a basic and diluted

14 loss per share of 80 cents for fiscal 2004. The results for fiscal year

15 2005 include $20 .2 million of acquisition related charges and expenses

16 and an effective annual tax rate of approximately 6 percent, and th e

17 results for fiscal year 2004 include $38.9 million of acquisition and

18 restructuring related charges and expenses, as well as a non-cash charge

19 of $45.0 million related to the establishment of a full valuatio n

20 allowance against our US deferred tax assets .

2 1

22

23

24 Balance Sheet

25

26 At January 1, 2006, Powerwave had total cash and cash equivalents of

27 $237.2 million, which included restricted cash of $5 .0 million. Total net

28

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1 inventories were $101 .5 million and net accounts receivable were $234.9

2 million .

3

4 55. In addition to the foregoing, the Company's January 31, 2006 release

5 quoted defendant Buschur, in part, as follows :

6 "For our fourth quarter, we are extremely proud to report record

7 revenuesfor Powerwave for both the quarter and ourfiscal year," stated

8 Ronald Buschur, President and Chief Executive Officer of Powerwave

9 Technologies. "On a sequential basis, our quarterly revenues grew 19%,

10 while on year-over-year basis our revenues grew over 65%. For all of fiscal

11 2005, we had record revenues of $825 million, which represents an annual

12 growth rate of 74%. During fiscal 2005, we delivered consistent profitable

13 growth while we significantly expanded our product offerings and

14 geographic capabilities while integrating and consolidating various

15 acquisitions . We now enter fiscal 2006 with a renewed focus on

16 delivering best in class products and services to the global wireless

17 infrastructure marketplace while maintaining the highest levels of

18 customer satisfaction . While we continue to focus on integrating our

19 recent acquisition of the selected assets and liabilities of REMEC's

20 wireless business, we believe that we are in an excellent position to

21 continue to refine our manufacturing excellence as well as drive additional

22 synergies and improvements through our global organization . We believe

23 that our market leading position and product portfolio will further

24 enhance our leadership position in both the OEM and direct to operator

25 markets ." [Emphasis added.]

26

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56 . Analyst Presentations . As shares of the Company continued to trad e

higher, in mid-March and into February 2006, defendants made a series of additiona l

presentations at analyst and stockholder conferences . Accordingly, on Thursday,

February 16, 2006, Powerwave presented at the JPMorgan Small Cap Conference in

Philadelphia, Pennsylvania and, on Friday, February 17, 2006, Powerwave presented at

the Deutsche Bank Small Cap Growth Conference in Naples, Florida . Thereafter, on

Wednesday, March 15, 2006, Powerwave also presented at the Deutsche Bank

Technology Conference in Miami, Florida. According to the Company, at thes e

presentations defendants reviewed the Company's purported wireless strategy, it s

market opportunities, guidance and historical financial results .

57. 2005 Form 10-K. On or about March 17, 2006, defendants filed with the

SEC the Company's 2005 Form 10-K for the fourth quarter and year end January 1,

2006, signed and/or certified by defendants Michaels and Buschur, among others . In

addition to making substantially similar statements concerning the Company operations

and financial condition as had been made previously and published in the Company's

January 31, 2006 release, the Company's 2005 Form 10-K also reported Powerwave's

"Critical Accounting Policies," in part, as follows :

Critical Accounting Policies and Estimates

We prepare our condensed consolidated financial statements in

conformity with accountingprinciples generally accepted in the United

States of America . As such, we are required to make certain estimates,

judgments and assumptions that we believe are reasonable based upon the

information currently available . These estimates and assumptions affect the

reported amounts of assets and liabilities at the date of the financial

statements and the reported amounts of revenues and expenses during the

periods presented. Any future changes to these estimates and assumptions

could cause a material change to our reported amounts of revenue ,

37\\Fileserver\sha reddocs\BLG\POW ERWAVE\PLD-WPD\Compla int.wpd

1 expenses, assets and liabilities . The critical accounting policies that we

2 believe are the most sign ificant for purposes of fully understanding and

3 evaluating our reportedfinancial results include thefollowing:

4

5 Revenue Recognition

6

7 The majority of our revenue is derived from the sales of products . We

8 recognize revenuefrom product sales at the time ofshipment or delivery

9 and passage of title depending upon the terms of the sale. We offer

10 certain of our customers the right to return products within a limited time

11 after delivery under specified circumstances . We monitor and track such

12 product returns and record a provision for the estimated amount of such

13 future returns based on historical experience and any notification we

14 receive of pending returns . . .

15

16 Accounts Receivable

1 7

18 We perform ongoing credit evaluations of our customers and adjust

19 credit limits based upon payment history , the customer's credit

20 worthiness and various other factors, as determined by our review of

21 their credit information . We monitor collections and payments from our

22 customers and maintain an allowance for estimated credit losses based

23 upon our historical experience and any specific customer collection issues

24 that we have identified. . .

25 Inventories

26

27 We value our inventory at the lower of the actual cost to purchase and/or

28 manufacture the inventory or the current estimated market value of the

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1 inventory. We regularly review inventory quantities on hand and on

2 order and record a provision for excess and obsolete inventory and/or

3 vendor cancellation charges related to purchase commitments .

4 Depending on the product line, such provisions are established based on

5 historical usage for the preceding twelve months, adjusted for known

6 changes in demands for such products, or the estimated forecast of product

7 demand and production requirements for the next twelve months . . . . .


9

10 58. Controls & Procedures . The 2005 Form 10-K also contained statements

11 that attested to the purported sufficiency and adequacy of the Company's internal

12 financial controls and operational procedures . In this regard, the 2005 Form 10-K

13 stated, in part, the following :

14

15 ITEM 9A. CONTROLS AND PROCEDURES

1 6

17 Controls and Procedures

1 8

19 We have established disclosure controls and procedures to ensure that

20 material information relating to Powerwave and its consolidated

21 subsidiaries is made known to the officers who certify' the Company's

22 financial reports, as well as other members of senior management and

23 the Board of Directors, to allow timely decisions regarding required

24 disclosures . As of the end of the period covered by this report, Powerwave

25 carried out an evaluation, under the supervision and with the participation

26 of the Company's management, including the Company's Chief Executive

27 Officer and Chief Financial Officer, of the effectiveness of the design and

28 operation of the Company's disclosure controls and procedures pursuant

3 9\\Fileserver\shareddocs\BLG\POWERWAVE\PLD-W PD \Complaint .wpd

1 to Rule 13a-15 of the Securities and Exchange Act of 1934 . Based upon

2 that evaluation, the Chief Executive Officer and ChiefFinancial Officer

3 concluded that the Company's disclosure controls and procedures

4 excluding disclosure controls and procedures related to REMEC, Inc.'s

5 Wireless Systems Business acquired on September 2, 2005 are effective

6 in timely alerting them to material information related to the Company

7 that is required to be included in Powerwave 's annual andperiodic SEC

8 filings.

9

10 There were no changes in our internal controls over financial reporting

11 during the year ended January 1, 2006 that have materially affected, or

12 are reasonably likely to materially affect our internal controls over

13 financial reporting .

14

15

16

17 Management 's Report on Internal Control Over Financial Reportin g

18

19 In making its assessment of the effectiveness of our internal controls over

20 financial reporting, our management used the criteria set forth by the

21 Committee of Sponsoring Organizations of the Treadway Commission

22 ("COSO") in Internal Control-Integrated Framework . Based on these

23 criteria, our management has concluded that, as of January 1, 2006, our

24 internal control over financial reporting, excluding internal controls

25 over financial reporting with respect to REMEC, are effective . Our

26 independent registered public accounting firm, Deloitte & Touche LLP,

27 has issued an audit report on our assessment of our internal control over

28 financial reporting, which is included herein. [Emphasis added.]

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59. Certifications . In addition to the foregoing, the Company's 2005 Form 10-

K also contained certifications by defendants Buschur and Michaels that attested to the

purported accuracy and completeness of the Company's financial and operational

reports, as follows :

CEO CERTIFICATION OF PERIODIC REPORT

I, Ronald J . Buschur, Chief Executive Officer of Powerwave

Technologies, Inc . (the "Company"), certify, pursuant to Section 906 ofthe

Sarbanes-Oxley Act of 2002, 18 U .S.C . Section 1350, that :

1 . the Annual Report on Form 10-K of the Company for the

annual period ended January 1, 2006 (the "Report") fully complies with the


1934 (15 U.S.C . 78m or 780(d)) ; and



the Company.

Date: March IT, 2006


Ronald J . Buschur



41\\Fileserver\shareddocs\BLG\POW ERWAVE\PLD-W PD\Compla int .wpd


2



5 Sarbanes-Oxley Act of 2002, 18 U .S.C. Section 1350, that :

6

7 1. the Annual Report on Form 10-K of the Company for the

8 annual period ended January 1, 2006 (the "Report") fully complies with the


10 1934 (15 U.S .C. 78m or 780(d)) ; and

11



14 the Company.

15

16 Date: March 17, 2006

1 7

18 By : /s/ KEVIN T. MICHAELS




22 [Emphasis added .]

23

24 60. The statements made by defendants during the Credit Suisse analyst and

25 investor presentation, and those statements contained in the Company's January 31,

26 2006 press release and in Powerwave's 2005 Form 10-K, were materially false and

27 misleading and were known by defendants to be false at that time, or were deliberately

28 disregarded as such thereby, for the reasons stated herein in ¶38, supra.

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61 . Taking full advantage of the artificial inflation in the price of Powerwave

shares, cased in substantial part as a result of the publication and dissemination of

defendants' materially false and misleading information about the Company, between

early February and early March 2006, insiders raced to the market to liquidate

substantial amounts of their personally-held Company stock, while in possession of

materially false and misleading information, as follows :

Date Insider Shares Sale Price ValuePer Share

2-Mar-06 GOTTSCHLICH 1,000,000 $15 .22 $15,220,000 .00MIKAELDirector

17-Feb-06 MICHAELS 25,000 15 .18 379,500 .00KEVIN T .Officer

17-Feb-06 LEGENDRE 60,000 15 .00 900,000 .00ROBERTOfficer

14-Feb-06 GOTTSCHLICH 13,125 14.55 190,968.00MIKAELDirector

10-Feb-06 GAINES 1,395 14 .47 20,185 .00GREGORY K.Officer

3-Feb-06 EDWARDS 150,000 14 .02 2,103,000.00BRUCE C .Officer

62. 1Q:F06 Update . On April 3, 2006, defendants published a release that

purported to provide investors with an "Update : on the first quarter 2006 . This release

stated, in part, the following :

Powerwave Technologies Provides First Quarter Updat e

SANTA ANA, Calif., April 03, 2006 - Powerwave Technologies, Inc .

(NASDAQ:PWAV) today provided preliminary revenue information for

its first quarter ending April 2, 2006. Powerwave announced that it no w

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anticipates that revenues for its first quarter ending April 2, 2006 will be

in the range of $190 million to $200 million . This updates previous

expectations of revenues in the range of $240 million to $250 million fo r

the first quarter.

"For the first quarter, we have experienced stronger seasonality than we

expected, which has resulted in a slower start to the year than we were

anticipating ," stated Ronald Buschur , President and Chief Executive

Officer of Powerwave Technologies. "Coupled with this stronger

seasonality, we have experienced slower-than-expected demand from a

major North American wireless network operator, which has als o

significantly impacted our first quarter . While we are disappointed with

this slow start to the year, we do remain very optimistic that demand

should increase as expected throughout the remainder of this year ."

[Emphasis added.]

63 . 1Q :06 Results. On May 2, 2006, Powerwave published a release

announcing results for the fiscal fist quarter ended April 2, 2006 . This release also

stated, in part, the following :

Powerwave Technologies Reports First Quarter Result s

SANTA ANA, Calif., , May 02, 2006 - Powerwave Technologies, Inc .

(NASDAQ :PWAV) today reported net sales of $193 .1 million for its first

quarter ended April 2, 2006, compared to first quarter fiscal 2005 revenues

of $162.2 million. Powerwave also reported first quarter net loss of $2 . 3

million, which includes a pre-tax total of $5 .3 million of acquisition related

charges and intangible asset amortization . For the first quarter , the net loss

equates to a basic loss per share of 2 cents for the first quarter. This

44\\Fi leserver\sha reddocs\ BLG\POW E RWAVE\PLD-W PD\Complaint.wpd

1 compares to net income of $5 .4 million, or diluted earnings per share of 5

2 cents for the prior year period. For the first quarter of fiscal 2006,

3 excluding all acquisition related charges and expenses, Powerwave would

4 have reported operating income of $2 .4 million, net income after taxes of

5 $2.8 million and diluted earnings per share of 3 cents .

6

7

8 Balance Sheet

9 At April 2, 2006, Powerwave had total cash and cash equivalents of $244 .5

10 million , which includes restricted cash of $5 .1 million. Total net


12 million.

13

14 64. In addition to the foregoing, the Company's May 2, 2006 release quoted

15 defendant Buschur, in part, as follows :

16 "I want to stress that we at Powerwave are extremely disappointed with our

17 results for the first quarter and we are utilizing all of our resources to

18 ensure that we get back on track starting with our second quarter," stated

19 Ronald Buschur, President and Chief Executive Officer of Powerwave

20 Technologies . "While we did encounter an unexpected slowdown in our

21 North American business, we do believe that the wireless infrastructure

22 industry has a number of growth opportunities and we continue to

23 believe that Powerwave is in excellentposition to build upon and capture

24 these opportunities in our markets throughout the world." [Emphasis

25 added.]

26

27

28 ///

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65. Additional Stock Presentations . On May 10, 2006, defendants als o

presented at the Baird Stock Growth Conference in Chicago, Illinois . The following

day, on Thursday, May 11, 2006, defendants also presented at the Piper Jaffray

Hardware Communication Conference in New York . At these presentations defendant s

again reviewed Powerwave's purported wireless strategy, its reported marke t

opportunities, guidance and historical financial results .

66. 1Q:06 Form 10-Q. On or about May 12, 2006, defendants filed with the

SEC the Company's 2Q :06 Form 10-Q, for the quarter ended April 2, 2006, signed

and/or certified by defendants Michaels and Buschur. In addition to making

substantially similar statements concerning the Company operations and financial

condition as had been made previously and published in the Company's May 2, 2006

release, the Company's 1Q:06 Form 10-Q also stated, in part, the following :

Basis of Presentation

The accompanying condensed consolidated financial statements of

Powerwave have been prepared in accordance with accountingprinciples

generally accepted in the United States of America for interim financial

information and in accordance with the instructions to Form 10-Q and

Article 10 of Regulation S-X . Accordingly, they do not include certai n

footnotes and financial presentations normally required under accounting

principles generally accepted in the United States of America for complete

financial reporting . The interim financial information is unaudited, but

reflects all normal adjustments and accruals, which are, in the opinion

of management, considered necessary to provide a fair presentation for

the interim periods presented. All intercompany balances and transactions

have been eliminated in the accompanying consolidated financial

statements. Certain prior period amounts have been reclassified to conform

to the current period presentation. [Emphasis added.]

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67. Controls & Procedures . The 1 Q :06 Form 10-Q also contained statements

that reported to attest to the sufficiency and adequacy of the Company's internal

financial controls and operational procedures . In this regard, the 1 Q:06 Form 10-Q

I stated, in part, the following :

ITEM 4. CONTROLS AND PROCEDURE S




subsidiaries is made known to the officers who certify' the Company's

financial reports, as well as other members ofsenior management and


disclosures . As of the end of the period covered by this report, Powerwav e

carried out an evaluation , under the supervision and with the participation

of the Company' s management, including the Company's Chief Executive

Officer and ChiefFinancial Officer, of the effectiveness of the design and

operation of the Company' s disclosure controls and procedures pursuan t

to Rule 13a-15 of the Securities Exchange Act of 1934 . Based upon that

evaluation, the Chief Executive Officer and Chief Financial Officer

concluded that the Company's disclosure controls and procedures ar e

effective in timely alerting them to material information related to the

Company that is required to be included in Powerwave 's annual and

periodic SEC filings.

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1 Internal Control Over Financial Reporting

2

3 There has been no change in the Company's internal control over

4 financial reporting during the first quarter of fiscal 2006 that has

5 materially affected, or is reasonable likely to materially affect, the

6 Company's internal control over financial reporting. [Emphasis added .]

7

8 68. Certifications . The Company's 2Q :06 Form 10-Q also contained

9 certifications by defendants Buschur and Michaels that attested to the purported

10 accuracy and completeness of the Company's financial and operational reports, as

11 follows:


1 3

14 I, Ronald J. Buschur, Chief Executive Officer of Powerwave


16 Sarbanes-Oxley Act of 2002, 18 U .S .C . Section 1350, that :

17




21 1934 (15 U.S.C . 78m or 780(d)) ; and

22



25 the Company.

26 III

27 III

28 II!

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1 Date : May 12, 2006

2

3 By : /s/ RONALD J. BUSCHUR





8



11 Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that :

12




16 1934 (15 U.S .C . 78m or 780(d)) ; and

17


19 all material respects , the financial condition and results of operations

20 of the Company.

21

22 Date : May 12, 2006

23





28 [Emphasis added.]

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69. The statements made by defendants during the Credit Suisse analyst and

investor presentation , and those statements contained in the Company's May 2, 200 6

press release and in Powerwave's I Q :06 Form 10-Q, were materially false an d

misleading and were known by defendants to be false at that time, or were deliberately

disregarded as such thereby, for the reasons stated herein in ¶ 38, supra .

70. Additional Stock Presentations . On May 23, 2006, defendants presente d

at the Lehman Brothers Worldwide Wireless Wireline Conference in New York . The

following day, on Wednesday, May 24, 2006, defendants also presented at the JP

Morgan Technology Conference in San Francisco, California . At these presentations

defendants again reviewed Powerwave's purported wireless strategy, its reported market

opportunities, guidance and historical financial results .

71 . 20.7M Share Filtronic Acquisition . Taking further advantage of th e

artificial inflation in the price of Powerwave shares caused as a result of the publication

of defendants' materially false and misleading statements about the Company, on June

12, 2006, defendants announced that Powerwave would acquire the wireless

infrastructure business of Filtronic plc . - - using at least 20 .7 million shares of Company

stock to complete this acquisition .' This release stated, in part, the following :

SANTA ANA, Calif. and LONDON , England , June 12, 2006 - Powerwave

Technologies, Inc. (NASDAQ: PWAV) and Filtronic plc (LSE : FTC) today

announced that they have signed a definitive agreement for Powerwave to

acquire the majority ofFiltronic ' s Wireless Infrastructure division business

for a combination of 20 .7 million newly issued shares of Powerwav e

1 Later, on September 5, 2006, Powerwave announced that the Company hadchanged the terms of its agreement to buy Filtronic's wireless infrastructure divisionbusiness and reduced the number of shares and increased the amount of cash to be

paid as consideration . Accordingly, under the original terms of the deal, announced

June 12, Powerwave would give $150 million in cash and 20 .7 million newly issued

shares of common stock for the business . Now, Filtronic will receive $185 million in

cash and issue 17.7 million shares .

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1 common stock and $150 million in cash . The specific product lines

2 included in this proposed transaction comprise transmit/receive filters,

3 integrated remote radio heads and power amplifier products, all for use in

4 commercial wireless infrastructure base station equipment (the "Wireless

5 Infrastructure business") . The proposed acquisition does not include point

6 to point radio backhaul equipment, as well as Filtronic's other divisions,

7 of Compound Semiconductors and Defence Electronics .

8

9 Powerwave currently estimates that it will easily achieve in excess of $10

10 million in annual cost savings following integration of the acquisition,

11 coming from efficiencies in manufacturing, purchasing, research and

12 development, and general and administrative overhead . Powerwave

13 currently anticipates achieving these cost savings within the first year

14 after completion of the proposed acquisition .

15

16 The transaction is expected to be accretive without synergies to

17 Powerwave' s earnings per share in the first full quarter following the

18 completion of the acquisition, excluding any acquisition related expenses .

19 Powerwave believes that combined revenues for calendar year 2007 will

20 easily exceed $1 .4 billion . Powerwave also currently estimates that the

21 proposed acquisition will be accretive to Powerwave 's fiscal year 2007

22 earnings per share in the range of 8 to 12 cents with synergies.

23

24 Deutsche Bank Securities acted as sole financial advisor to Powerwave and

25 JP Morgan Cazenove acted as sole financial advisor to Filtronic in relation

26 to the transaction. [Emphasis added . ]

27 72. In connection with this proposed stock-backed acquisition, this release also


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1 Ronald J. Buschur , President and Chief Executive Officer of Powerwave,

2 stated: "Our proposed acquisition of the Wireless Infrastructure business

3 of Filtronic will further expand Powerwave's leadership position in the

4 wireless infrastructure marketplace while deepening and strengthening our

5 relationships with our customers . We will be able to significantly expand

6 our transmit and receive filter product lines, as well as complement our

7 existing remote radio head products and RF conditioning products . We are

8 also excited about the opportunity to add one of the premier design and

9 engineering resources in the wireless infrastructure industry along with

10 Filtronic's excellent management capabilities to enhance our global

11 position in both OEM and network operator channels . In addition, we

12 believe that the increased purchasing power from this acquisition will

13 enable Powerwave to achieve significant cost synergies while further

14 leveraging our global manufacturing capabilities . " [Emphasis added.]

1 5

16 73. 2Q : 06 Results . On July 31, 2006, Powerwave published a release

17 announcing results for the fiscal second quarter ended July 2, 2006 . This release also

18 stated, in part, the following:

19 Powerwave Technologies Reports Second Quarter Results

20

21 Santa Ana, CA, July 31, 2006 - Powerwave Technologies, Inc .

22 (NASDAQ:PWAV) today reported net sales of $232.4 million for its

23 second quarter ended July 2, 2006, compared to second quarter fiscal 2005

24 revenues of $186 .3 million. Powerwave also reported second quarter net

25 income of $12 .6 million, which includes a total of $5 .6 million of

26 acquisition related charges and intangible asset amortization . The net

27 income equates to diluted earnings per share of 10 cents for the second

28 quarter, and a basic earnings per share of 11 cents for the same period . This

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1 compares to net income of $13 .0 million, or diluted earnings per share of

2 11 cents for the prior year period . For the second quarter of fiscal 2006,

3 excluding all acquisition related charges and expenses, Powerwave would

4 have reported operating income of $18 .7 million, net income after taxes of

5 $17.5 million and diluted earnings per share of 13 cents .

6

7

8 Balance Sheet

9

10 At July 2, 2006, Powerwave had total cash and cash equivalents of $220.2

11 million , which includes restricted cash of $11 .8 million. Total net

12 inventories were $132.1 million and net accounts receivable were $253 .7

13 million.

14

15 74. In addition to the foregoing, the Company's July 31, 2006 release that


17 "For our second quarter, we encountered less than expected demand

18 from our North American operator customers which impacted our

19 revenuesfor the quarter ," stated Ronald Buschur, President and Chief

20 Executive Officer of Powerwave Technologies . "In spite of this, we were

21 able to achieve both improvements to our gross and operating margins,

22 as well as pro forma earnings per share which were well within our

23 stated guidance . We will continue to aggressively pursue business globally

24 while at the same time work to continue to improve our operating

25 performance." [Emphasis added . ]

26 III

27 III

28 III

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75 . Additional Analyst Presentations . Following the publication of the July

31, 2006 release, on August 8, 2006, defendants also presented at the Pacific Cres t

Technology Forum in Vail, Colorado . The following day, August 9, 2006, defendants

also presented at the Canaccord Adams Summer Seminar in Boston, Massachusetts . At

these presentations defendants again reviewed Powerwave's purported wireless strategy,

its reported market opportunities, guidance and historical financial results .

76. The statements made by defendants during the Credit Suisse analyst and

investor presentation , and those statements contained in the Company's July 31, 2006

press release and in Powerwave's 2Q:05 Form 10-Q, were materially false an d

misleading and were known by defendants to be false at that time, or were deliberately

disregarded as such thereby, for the reasons stated herein in ¶ 38, supra.

THE TRUE FINANCIAL AND OPERATIONA L

CONDITION OF POWERWAVE IS BELATED DISCLOSE D

77. On October 9, 2006, prior to the opening of trading, defendants shocke d

investors after Powerwave issued a release which announced financial and operationa l

results , well below analysts' expectations - - with revenues for 3Q:06 now projected to

be as low as $155 million -- compared to original estimates as high as $250 million and

revised estimates as high as $230 million . At that time, defendants also significantly

lowered guidance for the remainder of the year . In addition this release also stated, in

part , the following:

Powerwave Technologies Provides Third Quarter Updat e

Monday October 9, 7 :15 am ET

SANTA ANA, Calif.--(BUSINESS WIRE )--Powerwave Technologies, Inc .

(NASDAQ :PWAV - News ) today provided preliminary revenue

information for its third quarter ending October 1 , 2006 . Powerwave

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1 announced that it now anticipates that revenues for its third quarter

2 ending October 1 , 2006 will be in the range of $155 million to $160

3 million. This updates previous expectations of revenues in the range of

4 $200 million to $210 million for the third quarter .

5

6 "During the third quarter, we experienced several issues which have

7 impacted our results for the quarter," stated Ronald Buschur, President and

8 Chief Executive Officer of Powerwave Technologies . "These issues

9 included difficulties in implementing our new ERP system in our

10 European operations during the quarter, coupled with delays in the

11 transfer of production from one ofour manufacturing locations. These

12 issues combined resulted in both delayed production and shipments

13 which significantly reduced our actual revenues for the quarter.

14 Combining these issues with the traditional slow seasonality of the third

15 quarter, which is normally heavily weighted towards the month of

16 September, helped to mask the impact of these issues during the quarter.

17 We are implementing steps to ensure that we do not encounter these issues

18 going forward. In addition to these factors, we experienced some additional

19 slowness during the third quarter in both the OEM and operator direct

20 channels. While we are extremely disappointed with the preliminary results

21 for the third quarter, we do believe the long-term outlook for our business

22, remains strong and we continue to believe that we are well positioned with

23 our products and customers. I want to assure you that we are focused and

24 confident in our ability to overcome this setback." [Emphasis added .]

25

26 78. Based on the huge disparity between defendants' prior guidance, the

27 Company's past performance and the results announced by defendants that day, on

28 October 9, 2006, Powerwave stock plummeted - - falling almost 20% in the single

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1

2

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trading day, and trading to a low of $6 .30 per share in regular trading on the Nasdaq

after closing on October 6, 2005 at $7 .80 per share - - a decline of $1 .50 per share . That

day, over 18 .3 million shares traded, many times the average trading volume fo r

Powerwave shares .

79. The same day, the Associated Press reported that, prior to lowering revenue

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guidance as low as $155 million, analysts had expected revenues as high as $210

million, with a Wall Street consensus estimate of $206 .2 million according to Thompson

Financial / First Call . This AP report also quoted Jefferies analyst Bill Choi who stated

that, "we believe its credibility took a big hit today given the size and company -specific

nature of the miss. "

80. Moreover, after reporting the third revenue shortfall in as many reporte d

quarters, it became obvious to analysts and investors that the problems facing the

Company were not minor, one-time issues as previously characterized by defendants

but, rather, systemic internal problems that existed and continue to exist within the

Company. As further evidence of this, later the same day, TheStreet.com also quoted

JPMorgan analyst Kim Anderson who stated, "demand for wireless infrastructure is

worse than we thought. We had been expecting demand to bounce back in the fourth

quarter. "

81 . In addition to internal control and reporting weaknesses, operationa l

problems related to production, mangled software upgrades and a bungled factory shift,

the massive order slow-down belatedly revealed by defendants on October 9, 2006, was

so severe that it evidenced problems existing well before defendants' announcement .

As Oppenheimer & Co . analyst Lawrence M. Harris pointed out in a Fortune report, not

only would the Company's weakness now open it up to further competition but

Powerwave's manufacturing problems and system integration issues are also expected

to have a lingering effect on the Company - - adversely impacting Powerwave' s

performance in the foreseeable near term .

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82. Robert W. Baird & Co. analyst Kenneth Muth summarized the conditio n

of the Company, following the publication defendants' belated disclosures on October

9, 2006, and stated, that the problems at Powerwave are "self-inflicted" and not

"industry -driven."

83 . The market for Powerwave's common stock was open, well-developed and

efficient at all relevant times. As a result of these materially false and misleading

statements and failures to disclose, Powerwave common stock traded at artificially-

inflated prices during the Class Period. Plaintiff and other members of the Class

purchased or otherwise acquired Powerwave common stocking upon the integrity of the

market price of Powerwave common stock and market information relating to

Powerwave, and have been damaged thereby .

84 . During the Class Period, defendants materially misled the investing public ,

thereby inflating the price of Powerwave common stock by publicly issuing false and

misleading statements and omitting to disclose material facts necessary to make

defendants' statements, as set forth herein, not false and misleading . Said statements

and omissions were materially false and misleading in that they failed to disclos e

material adverse information and misrepresented the truth about the Company, its

business and operations, as alleged herein .

85 . At all relevant times, the material misrepresentations and omission s

particularized in this Complaint directly or proximately caused or were a substantial

contributing cause of the damages sustained by plaintiff and other members of the Class .

As described herein, during the Class Period, defendants made or caused to be made a

series of materially false or misleading statements about Powerwave's business,

prospects and operations. These material misstatements and omissions had the cause

and effect of creating in the market an unrealistically positive assessment of Powerwave

and its business, prospects and operations, thus causing the Company's common stock

to be overvalued and artificially inflated at all relevant times . Defendants' materially

false and misleading statements during the Class Period resulted in plaintiff and othe r

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members of the Class purchasing the Company's common stock at artificially-inflated

prices, thus causing the damages complained of herein .

CAUSATION AND ECONOMIC LOS S

86. During the Class Period, as detailed herein, defendants engaged in a schem e

to deceive the market, and a course of conduct that artificially inflated Powerwave's

stock price and operated as a fraud or deceit on Class Period purchasers of Powerwave's

stock by misrepresenting the Company's financial results and operating position . Over

a period of approximately eighteen months, defendants issued a series of materially false

and misleading statements about the Company that had the effect of inflating its share

prices. Ultimately, however, when defendants' prior misrepresentations and fraudulent

conduct came to be revealed and was apparent to investors, shares of Powerwave

declined precipitously - - evidence that the prior artificial inflation in the price of

Powerwave's shares was eradicated . As a result of their purchases of Powerwave stock

during the Class Period, plaintiff and other members of the Class suffered economic

losses, i.e. damages under the federal securities laws.

87 . By improperly characterizing the Company's operational and financial

condition and misrepresenting Powerwave's prospects, defendants presented a

misleading image of Powerwave's business and future growth prospects . During the

Class Period, defendants repeatedly emphasized the ability of the Company to monitor

and control its operations, and consistently reported results within the range of guidanc e

sponsored or endorsed by the Company. These claims caused and maintained th e

artificial inflation in Powerwave's stock price throughout the Class Period and until th e

truth about the Company was ultimately revealed to investors .

88. As a direct result of defendants' statements on October 9, 2006, whic h

indicated that the Company was operating well below plan and was suffering from a

host of internal company-specific problems, Powerwave's stock price traded to a lo w

of $6.30 per share - - a decline of over 20% compared to the price of Powerwave share s

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1 on October 6, 2006, before news of Powerwave's scheme reached the market, and well

2 over 50% from the Class Period high of over $15 .00 reached during l Q:06. This

3 dramatic share price decline eliminated much of the artificial inflation from

4 Powerwave's share price causing real economic loss to investors who purchased this

5 stock during the Class Period .

6 89. In sum, as the truth about defendants' fraud and illegal course of conduct

7 became known to investors, and as the artificial inflation in the price of Powerwave

8 shares was eliminated, plaintiff and the other members of the Class were damaged,

9 suffering a direct economic loss for each share purchased during the Class Period .

10 90. The decline in Powerwave's stock price at the end of the Class Period was

11 a direct result of the nature and extent of defendants' fraud being revealed to investors

12 and to the market . The timing and magnitude of Powerwave's stock price decline

13 negates any inference that the losses suffered by plaintiff and the other members of the

14 Class was caused by changed market conditions, macroeconomic or industry factors or

15 even Company-specific facts unrelated to defendants' fraudulent conduct . During the

16 same period in which Powerwave's share price fell over 50% as a result of defendants

17 fraud being revealed, the Standard & Poor's 500 securities index was relatively

18 unchanged .

19 91 . The economic loss, i.e. damages suffered by plaintiff and other members

20 of the Class, was a direct result of defendants' fraudulent scheme to artificially inflate

21 the price of Powerwave's stock and the subsequent significant decline in the value of

22 the Company's shares when defendants' prior misstatements and other fraudulent

23 conduct was revealed .

24ADDITIONAL SCIENTER ALLEGATIONS

2592. As alleged herein, defendants acted with scienter in that each defendant

26knew that the public documents and statements issued or disseminated in the name of

27 the Company were materially false and misleading ; knew that such statements or28

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documents would be issued or disseminated to the investing public ; and knowingly and

I substantially participated or acquiesced in the issuance or dissemination of such

statements or documents as primary violations of the federal securities laws . As set

forth elsewhere herein in detail, defendants, by virtue of their receipt of informatio n

reflecting the true facts regarding Powerwave, their control over, and/or receipt and/o r

modification ofPowerwave's allegedly materially misleading misstatements and/or their

associations with the Company which made them privy to confidential proprietary

information concerning Powerwave, participated in the fraudulent scheme allege d

herein.

93 . Defendants were motivated to materially misrepresent to the SEC an d

I investors the true financial condition of the Company because this scheme : (i) enabled

defendants to artificially inflate the price ofPowerwave's shares; (ii) enabled defendant s

to register for sale with the SEC millions of shares of Company stock that they then

either sold to the public or used to acquire the assets of other, unwitting companies ; (iii )

enabled Powerwave insiders to sell millions of dollars of their privately held Powerwav e

shares while in possession of material adverse non-public information about th e

Company ; and (iv) caused plaintiff and other members of the Class to purchase

Powerwave common stock at artificially-inflated prices .

94. The insider stock sales that occurred within the Class Period are set forth

below:

Date Insider Shares Sale PricePer Share

Value

2-Mar-06 GOTTSCHLICH 1,000,000 $15 .22 $15,220,000 .00MIKAELDirector

17-Feb-06 MICHAELS 25,000 15 .18 379,500.00KEVIN T .Officer

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17-Feb-06 LEGENDRE 60,000 15 .00 900,000 .0 0ROBERTOfficer

14-Feb-06 GKTSSCHLICH 13,125 14 .55 190,968 .00A

Director

10-Feb-06 GAINES 1,395 14 .47 20,185 .00GREGORY K.Officer

3-Feb-06 EDWARDS 150,000 14.02 2,103,000 .00BRUCE C .Officer

8-Nov-05 EDWARDS 200,000 13 .10 2,620,000 .00BRUCE C .Officer

14-Sep-05 MICHAELS 11,250 12 .26* 137,925 .00KEVIN T.Officer

12-Sep-05 LEGENDRE 50,000 11 .10 555,000.00ROBERTOfficer

15-Aug-05 EDWARDS 50,613 11 .16 564,841 .00BRUCE C .Officer

TOTAL ALL DEFENDANTS $22,691 ,419.00

*Disposition - Non Open Market.

Applicability Of Presumption Of Reliance :

Fraud-On-The-Market Doctrin e

95 . At all relevant times, the market for Powerwave's common stock was an

efficient market for the following reasons, among others :

a. Powerwave's stock met the requirements for listing, and was listed

and actively traded on the Nasdaq national market exchange, a highly-efficient and

automated market;

b . As a regulated issuer, Powerwave filed periodic public reports with

the SEC and the Nasdaq ;

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c . Powerwave regularly communicated with public investors via

I established market communication mechanisms, including through regula r

disseminations of press releases on the national circuits of major newswire services and

through other wide-ranging public disclosures, such as communications with the

financial press and other similar reporting services ; and

d. Powerwave was followed by several securities analysts employed by

major brokerage firm(s) who wrote reports which were distributed to the sales force and

certain customers of their respective brokerage firm(s) . Each of these reports wa s

publicly available and entered the public marketplace .

96. As a result of the foregoing, the market for Powerwave securities promptly

digested current information regarding Powerwave from all publicly available sources

and reflected such information in Powerwave stock price . Under these circumstances ,

all purchasers of Powerwave common stock during the Class Period suffered similar

injury through their purchase ofPowerwave common stock at artificially inflated price s

and a presumption of reliance applies .

NO SAFE HARBOR

97. The statutory safe harbor provided for forward- looking statements unde r

certain circumstances does not apply to any of the allegedly false statements pleaded in

this complaint. Many of the specific statements pleaded herein were not identified as

"forward-looking statements" when made . To the extent there were any forward-

looking statements, there were no meaningful cautionary statements identifying

important factors that could cause actual results to differ materially from those in th e

purportedly forward- looking statements .

98. Alternatively, to the extent that the statutory safe harbor does apply to any

forward-looking statements pleaded herein, defendants are liable for those false

forward-looking statements because at the time each of those forward-looking

statements was made, the particular speaker knew that the particular forward-looking

statement was false, and/or the forward-looking statement was authorized and/o r

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1 approved by an executive officer of Powerwave who knew that those statements were

2 false when made .

3 BASIS OF ALLEGATIONS

4 99. Plaintiff has alleged the following based upon the investigation of

5 plaintiff's counsel, which included a review of SEC filings by Powerwave, as well as

6 regulatory filings and reports, securities analysts' reports and advisories about the

7 Company, press releases and other public statements issued by the Company, and media

8 reports about the Company, and plaintiff believes that substantial additional evidentiary

9 support will exist for the allegations set forth herein after a reasonable opportunity for

10 discovery .

11 FIRST CLAIM

12 Violation Of Section 10(b) OfThe Exchange Act And Rule 10b-5

13 Promulgated Thereunder Against All Defendant s

14 100. Plaintiff repeats and realleges each and every allegation contained above

15 as if fully set forth herein .

16 101 . During the Class Period, defendants carried out a plan, scheme and course

17 of conduct which was intended to and, throughout the Class Period, did : (i) deceive the

18 investing public regarding Powerwave's business, operations, management and the

19 intrinsic value ofPowerwave common stock; (ii) enable defendants to artificially inflate

20 the price of Powerwave's shares ; (iii) enable defendants to register for sale with the

21 SEC, millions of shares of Company stock, that they then either sold to the public or

22 used to acquire the assets of other, unwitting companies ; (iv) enable Powerwave insiders

23 to sell millions of dollars of their privately held Powerwave shares while in possession

24 of material adverse non-public information about the Company ; and (v) cause plaintiff

25 and other members of the Class to purchase Powerwave common stock at artificially

26 inflated prices .

27 102. In furtherance of this unlawful scheme, plan and course of conduct,

28 defendants, jointly and individually (and each of them) took the actions set forth herein .

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103 . Defendants (a) employed devices, schemes, and artifices to defraud ;

(b) made untrue statements of material fact and/or omitted to state material facts

necessary to make the statements not misleading ; and (c) engaged in acts, practices, and

a course of business which operated as a fraud and deceit upon the purchasers of the

Company's common stock in an effort to maintain artificially high market prices for

Powerwave's common stock in violation of Section 10(b) of the Exchange Act and Rule

1 Ob-5 . All defendants are sued either as primary participants in the wrongful and illegal

conduct charged herein or as controlling persons as alleged below .

104 . Defendants, individually and in concert, directly and indirectly, by the use ,

means or instrumentalities of interstate commerce and/or of the mails, engaged and

participated in a continuous course of conduct to conceal adverse material informatio n

about the business, operations and future prospects of Powerwave as specified herein .

105. These defendants employed devices, schemes and artifices to defraud,

while in possession of material adverse non-public information and engaged in acts,

practices, and a course of conduct as alleged herein in an effort to assure investors of

Powerwave's value and performance and continued substantial growth, which included

the making of, or the participation in the making of, untrue statements of material fact s

and omitting to state material facts necessary in order to make the statements made

about Powerwave and its business operations and future prospects in the light of the

circumstances under which they were made, not misleading, as set forth more

particularly herein, and engaged in transactions, practices and a course of business

which operated as a fraud and deceit upon the purchasers of Powerwave common stock

during the Class Period.

106. Each ofthe Individual Defendant's primary liability, and controlling person

liability, arises from the following facts : (i) the Individual Defendants were high-level

executives and/or directors at the Company during the Class Period and members of the

Company's management team or had control thereof; (ii) each of these defendants, by

virtue of his responsibilities and activities as a senior officer and/or director of th e

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I Company was privy to and participated in the creation, development and reporting of

2 the Company's internal budgets, plans, projections and/or reports ; (iii) each of these

3 defendants enjoyed significant personal contact and familiarity with the other defendants

4 and was advised of and had access to other members of the Company's management

5 team, internal reports and other data and information about the Company's finances,

6 operations, and sales at all relevant times; and (iv) each of these defendants was aware

7 of the Company's dissemination of information to the investing public which they knew

8 or deliberately disregarded was materially false and misleading .

9 107. The defendants had actual knowledge of the misrepresentations and

10 omissions of material facts set forth herein, or acted with deliberate disregard for the

11 truth in that they failed to ascertain and to disclose such facts . Such defendants'

12 material misrepresentations and/or omissions were done knowingly or with deliberately

13 for the purpose and effect of concealing Powerwave's operating condition and future

14 business prospects from the investing public and supporting the artificially-inflated price

15 of its common stock . As demonstrated by defendants' overstatements and misstatements

16 of the Company's business, operations and earnings throughout the Class Period,

17 defendants, if they did not have actual knowledge of the misrepresentations and

18 omissions alleged, were deliberate in failing to obtain such knowledge by deliberately

19 refraining from taking those steps necessary to discover whether those statements were

20 false or misleading .

21 108. As a result of the dissemination of the materially false and misleading

22 information and failure to disclose material facts, as set forth above, the market price of

23 Powerwave common stock was artificially inflated during the Class Period . In

24 ignorance of the fact that market prices of Powerwave's publicly-traded common stock

25 were artificially inflated, and relying directly or indirectly on the false and misleading

26 statements made by defendants, or upon the integrity of the market in which the

27 securities trade, and/or on the absence of material adverse information that was known

28 to or deliberately disregarded by defendants but not disclosed in public statements by

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1 defendants during the Class Period, plaintiff and the other members of the Class

2 acquired Powerwave common stock during the Class Period at artificially-high prices

3 and were damaged thereby .

4 109. At the time of said misrepresentations and omissions, plaintiff and other

5 members of the Class were ignorant of their falsity, and believed them to be true . Had

6 plaintiff and the other members of the Class and the marketplace known the truth

7 regarding the problems that Powerwave was experiencing, which were not disclosed by

8 defendants, plaintiff and other members of the Class would not have purchased or

9 otherwise acquired their Powerwave common stock, or, if they had acquired such

10 common stock during the Class Period, they would not have done so at the artificially

11 inflated prices which they paid .

12 110. By virtue of the foregoing, defendants have violated Section 10(b) of the

13 Exchange Act, and Rule I Ob-5 promulgated thereunder .

14 111 . Asa direct and proximate result of defendants' wrongful conduct, plaintiff

15 and the other members of the Class suffered damages in connection with their respective

16 purchases and sales of the Company's common stock during the Class Period .

17 SECOND CLAIM

18 Violation Of Section 20(a) Of

19 The Exchange Act Against Individual Defendants

20

21 112. Plaintiff repeats and realleges each and every allegation contained above

22 as if fully set forth herein .

23 113. The Individual Defendants acted as controlling persons of Powerwave

24 within the meaning of Section 20(a) of the Exchange Act as alleged herein . By virtue

25 of their high-level positions, and their ownership and contractual rights, participation

26 in and/or awareness of the Company's operations and/or intimate knowledge ofthe false

27 financial statements filed by the Company with the SEC and disseminated to the

28 investing public, the Individual Defendants had the power to influence and control and

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did influence and control, directly or indirectly, the decision-making of the Company,

including the content and dissemination of the various statements which plaintif f

contends are false and misleading . The Individual Defendants were provided with or

had unlimited access to copies of the Company's reports, press releases, public filings

and other statements alleged by plaintiff to be misleading prior to and/or shortly after

these statements were issued and had the ability to prevent the issuance of the statement s

or cause the statements to be corrected .

114 . In particular, each of these defendants had direct and supervisory

involvement in the day-to-day operations of the Company and, therefore, is presumed

to have had the power to control or influence the particular transactions giving rise to

the securities violations as alleged herein, and exercised the same .

115 . As set forth above, Powerwave and the Individual Defendants each violated

Section 10(b) and Rule l Ob-5 by their acts and omissions as alleged in this Complaint .

By virtue of their positions as controlling persons, the Individual Defendants are liable

pursuant to Section 20(a) of the Exchange Act. As a direct and proximate result of

defendants' wrongful conduct, plaintiff and other members of the Class suffered

damages in connection with their purchases of the Company's common stock during the

Class Period .

WHEREFORE, plaintiff prays for relief and judgment, as follows :

A. Determining that this action is a proper class action, designating plaintif f

as Lead Plaintiff and certifying plaintiff as a class representative under Rule 23 of th e

Federal Rules of Civil Procedure and plaintiff's counsel as Lead Counsel ;

B . Awarding compensatory damages in favor of plaintiff and the other Clas s

members against all defendants, jointly and severally, for all damages sustained as a

result of defendants' wrongdoing, in an amount to be proven at trial, including interes t

thereon ;

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C . Awarding plaintiff and the Class their reasonable costs and expenses

incurred in this action, including counsel fees and expert fees ;

D. Awarding extraordinary, equitable and/or injunctive relief as permitted by

law, equity and the federal statutory provisions sued hereunder, pursuant to Rules 64

and 65 and any appropriate state law remedies to assure that the Class has an effectiv e

remedy; and

E. Such other and further relief as the Court may deem just and proper .

JURY TRIAL DEMANDED

Plaintiff hereby demands a trial by jury .

I Dated : January 16, 2007

By:

Michael D. BraunBRAUN LAW GROUP, P.C .

12400 Wilshil Blv ., Suite 920Los Angeles, 002 5Tel : 310 442-7755Fax: (310) 442-775 6E-mail : service@braunlawgroup .com

Michael A. SwickKim E. MillerKAHN GAUTHIER SWICK, LLC114 E. 39th StreetNew York, NY 10016Tel : (212) 920-4310Fax: (504) 455-1498

Lewis KahnKAHN GAUTHIER SWICK LLC650 Poydras Street Suite 21 SONew Orleans LA 1013 0Tel : 504 455-1400Fax: (504) 455-149 8

Counsel for Plaintiff

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CERTIFICATION IN SUPPORT OF APPLICATION FOR LEAD PLAINTIFF

-5tfr4mi Cc\4ekG t (name) ("plaintiff ') declares , as to the claims asserted under the federalsecurities law, that:

1 . Plaintiff has fully reviewed the facts of the complaint(s) filed in this action alleging

violations of the securities laws and plaintiff is willing to serve as a lead plaintiff in this case and all other

related cases that may be consolidated with it .

2 Plaintiff did not purchase securities of Powerwave at the direction of counsel or in order

to participate in a private action under the federal securities laws .

3 . Plaintiff is willing to serve as a representative party on behalf of a class, including

providing testimony at deposition and trial, if necessary .

4 . During the Class Period, plaintiff has executed transactions in the securities of

Powerwave as follows. See Attached Schedule.

5 . In the last three years, plaintiff has not sought to serve as a representative party on behalf

of a class in an action filed under the federal securities laws, except as indicated herein.

6 Plaintiff will not accept payment for se rving as a lead plaintiff beyond its pro rata share

of any recovery, except such reasonable costs and expenses ( including lost wages) directly relating to the

representation of the Class as ordered or approved by the Court .

I declare under penalty of perjury that the foregoing is true and correct to the best of my

knowledge, information and belief.

Dated: November--7,

6Qec~n bit DOO(o

Plaintiff

Jerry Michael Crafton Powerwave Tech Inc Trade Data

5/11/2006 BUY 1,000 $ 10.77 $ 10,770.005/18/2006 BUY 500 $ 10.20 $ 5,100.005/31/2006 BUY 500 $ 9.73 $ 4,865.006/7/2006 BUY 500 $ 9.10 $ 4,550 .0 0

6/28/2006 BUY 500 $ 9.08 $ 4,540.007/7/2006 BUY 500 $ 8.53 $ 4,265.007/7/2006 BUY 500 $ 8.80 $ 4,400.00

7/10/2006 BUY 1,000 $ 8.27 $ 8,270.007/18/2006 BUY 1,000 $ 8.02 $ 8,020 .0 07/20/2006 BUY 1,000 $ 7.80 $ 7,800.007/27/2006 BUY 1,000 $ 7.56 $ 7,560.00

7/28/2006 SELL 1,000 $ 7.86 $ 7,860 .008/4/2006 SELL 1,000 $ 6.54 $ 6,540 .008/9/2006 SELL 1,000 $ 6.83 $ 6,830 .008/11/2006 SELL 2,500 $ 6.38 $15,950 .008/17/2006 SELL 2,500 $ 6.88 $17,200 .00

, LODGED - SOUTHERN DIVISIO N 111h120...

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