NOTICE OF PENDENCY AND PROPOSED SETTLEMENT OF CLASS ACTION

Transcription

1 UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA JERRY MICHAEL CRAFTON, Individually and on Behalf of All Others Similarly Situated Plaintiff, v. CASE NO. SACV PSG (MLGx) CLASS ACTION POWERWAVE TECHNOLOGIES, INC., BRUCE C. EDWARDS, RONALD J. BUSCHUR and KEVIN T. MICHAELS, Defendants. NOTICE OF PENDENCY AND PROPOSED SETTLEMENT OF CLASS ACTION IF YOU PURCHASED OR OTHERWISE ACQUIRED THE COMMON STOCK OF POWERWAVE TECHNOLOGIES, INC. ( POWERWAVE ) BETWEEN MAY 2, 2005 AND NOVEMBER 2, 2006, INCLUSIVE, AND HELD SHARES PURCHASED DURING THAT PERIOD THROUGH THE CLOSE OF TRADING ON NOVEMBER 2, 2006, YOU COULD GET A PAYMENT FROM A CLASS ACTION SETTLEMENT. A federal court authorized this Notice. This is not a solicitation from a lawyer. Security and Time Period: Powerwave (NASDAQ National Market symbol PWAV ; CUSIP ) common stock purchased or otherwise acquired between May 2, 2005 and November 2, 2006, inclusive (the Settlement Class Period ), and held through the close of trading on November 2, Settlement Amount: $3,150,000 in cash. Statement of Recovery: Your recovery will depend on the number of shares of Powerwave common stock purchased or otherwise acquired during the Settlement Class Period, the price paid for those shares and whether you retained shares through the close of trading on November 2, 2006 or sold shares during the Settlement Class Period. Approximately 88 million shares of Powerwave common stock were traded during the Settlement Class Period which may have been damaged. If claims are submitted for 100% of the eligible shares of Powerwave common stock (which is not expected to occur), the estimated average recovery per share will be approximately $ per share before deduction of Court-approved fees and expenses. A Settlement Class Member s actual recovery will be a proportion of the Net Settlement Fund determined by that Claimant s Recognized Claim as compared to the total Recognized Claims of all the Settlement Class Members who submit acceptable Proof of Claim and Release forms. Depending on the number of shares for which claims are submitted, when during the Settlement Class Period a Settlement Class Member purchased or otherwise acquired shares of Powerwave common stock, the purchase price paid, and whether those shares were held after the close of trading on November 2, 2006 or sold during the Settlement Class Period, and, if sold, when they were sold and amount received, an individual Settlement Class Member may receive more or less than this average amount. If your Settlement Class Period transactions resulted in a net gain, you will not have a Recognized Claim. See the Plan of Allocation beginning on page 6 for more information on your Recognized Claim. Reasons for Settlement: The principal reason for the Lead Plaintiff s consent to the Settlement is to provide a benefit to the Settlement Class. This benefit must be compared to the risk that no recovery might be achieved after contested motions, a contested trial and likely appeals, possibly years into the future. For the Defendants, who deny all allegations of wrongdoing or liability whatsoever, the principal reason for the

2 Settlement is to eliminate the expense, risks, and uncertain outcome of the litigation. The claims advanced by the Lead Plaintiff on behalf of the class involve numerous complex legal and factual issues, which would require extensive expert testimony and would add considerably to the expenses and duration of the Litigation. The parties disagree on both liability and the amount of money that could have been won if the Lead Plaintiff prevailed at trial. The parties further disagree about: (a) whether the statements made or facts allegedly omitted were material or otherwise actionable under the federal securities laws; (b) the amount by which the trading price of Powerwave common stock was allegedly artificially inflated (if at all) during the Settlement Class Period; (c) the extent to which external factors, such as general market and industry conditions affected the trading price of Powerwave common stock at various times during the Settlement Class Period; (d) the extent (if any) to which the various matters that plaintiffs allege were materially false or misleading affected the trading price of Powerwave common stock at various times during the Settlement Class Period; (e) the extent (if any) to which the various allegedly adverse material facts that plaintiffs allege were omitted affected the trading price of Powerwave common stock at various times during the Settlement Class Period; and (f) the appropriate economic model for determining the amount by which the trading price of Powerwave common stock was allegedly artificially inflated (if at all) during the Settlement Class Period. The Lead Plaintiff recognizes that it is possible that he may not have prevailed on any or all of his claims and that therefore the Settlement Class would have recovered nothing at all. The Defendants deny that they are liable to the Lead Plaintiff or the Settlement Class and deny that the Lead Plaintiff or the Settlement Class has suffered any damages. As a result, the Lead Plaintiff believes this Settlement is a fair, reasonable and adequate recovery for the Settlement Class. Attorneys Fees and Expenses: Court-appointed Plaintiffs Co-Lead Counsel have not received any payment for their work conducting this litigation since 2007 and negotiating the Settlement on behalf of the Lead Plaintiff and the Settlement Class. Plaintiffs Co-Lead Counsel have advanced the expenses of the litigation in the expectation that if they were successful in obtaining a recovery for the Settlement Class they would be paid from such recovery. In this type of litigation, typically counsel are awarded a percentage of the common fund recovery as their attorneys fees. Plaintiffs Co-Lead Counsel will ask the Court to award attorneys fees not to exceed 33 1/3% of the Settlement Fund, and for reimbursement of expenses incurred in connection with the prosecution of this Litigation in the approximate amount of $295,000 to be paid from the Settlement Fund. If the attorneys fees and expense amounts requested above are approved by the Court, the average cost per share will be approximately $ The Lead Plaintiff will also ask the Court for reimbursement of his reasonable costs and expenses (including lost wages) directly related to his representation of the Settlement Class in an amount not to exceed $30,000. Your legal rights are affected whether you act or do not act. Please read this Notice carefully. SUBMIT A CLAIM FORM BY NOVEMBER 4, 2009 OBJECT BY OCTOBER 5, 2009 GO TO A HEARING ON OCTOBER 19, 2009 REQUEST EXCLUSION (OR OPT-OUT) OF THE CLASS BY OCTOBER 5, 2009 DO NOTHING YOUR LEGAL RIGHTS AND OPTIONS IN THIS SETTLEMENT The only way to receive a payment. You may write to the Court if you do not like the Settlement. Your objection must be filed and served by mail by the date indicated You may ask to speak in Court about the fairness of the Settlement. Get no payment. This is the only option that allows you to participate in another lawsuit against the Defendants relating to the claims being released in this case. Your request to be excluded must be postmarked by the date indicated Receive no payment. Give up rights. 2

3 For More Information Contact: Claims Administrator: Plaintiffs Co-Lead Counsel: Powerwave Technologies Richard B. Brualdi, Esq. Securities Litigation The Brualdi Law Firm, P.C. c/o Berdon Claims Administration LLC 29 Broadway, Suite 2400 P.O. Box 9014 New York, NY Jericho, NY Telephone: (212) Toll-Free Phone: (800) Toll Free Phone: (877) Fax: (516) or Website: Jordan Lurie, Esq. Weiss & Lurie Wilshire Boulevard, Suite 2300 Los Angeles, CA Telephone: (310) Your rights and options and the deadlines to exercise them are explained in this Notice. The Court in charge of this case still has to decide whether to approve the Settlement. Payments will be made if the Court approves the Settlement and after appeals, if any, are resolved. Please be patient. 1. Why Did I Get this Notice Package? BASIC INFORMATION You or someone in your family may have purchased Powerwave common stock during the period from May 2, 2005 to November 2, 2006, inclusive. While this alone does not qualify you to be eligible for a payment from this Settlement, it is sufficient to identify you as a potential participant in this action. Please read this Notice carefully for further details. The Court directed that you be sent this Notice because you have a right to know about a proposed Settlement of a class action lawsuit, and about all of your options, before the Court decides whether to approve the Settlement. If the Court approves the Settlement, and after objections and appeals are resolved, the Claims Administrator appointed by the Court will make the payments that the Settlement allows. This package explains the lawsuit, the Settlement, your legal rights, what benefits are available, who is eligible for them, and how to get them. The Court in charge of the case is the United States District Court for the Central District of California, and the case is known as Crafton v. Powerwave Technologies Inc., et al., Case No. SACV PSG. This case is assigned to United States District Judge Philip S. Gutierrez. The people who sued are called plaintiffs, and those they sued are called Defendants. The Defendants in this case are Powerwave, Bruce C. Edwards ( Edwards ), Ronald J. Buschur ( Buschur ) and Kevin T. Michaels ( Michaels ). Defendants Edwards, Buschur and Michaels are collectively referred to as the Individual Defendants. John Both was appointed by the Court to serve as the Lead Plaintiff. 2. What Is this Lawsuit About? Powerwave designs, manufactures and markets antennas, boosters, combiners, filters, repeaters, multicarrier RF power amplifiers, tower-mounted amplifiers and advanced coverage solutions, all for use in cellular, PCS and 3G networks. In this lawsuit, the Lead Plaintiff asserts that, during the period between May 2, 2005 and November 2, 2006, Defendants made material misrepresentations and/or material omissions about, among other things, Powerwave s purported financial condition, operations, accounting, growth, income, earnings and prospects. 3

4 The Lead Plaintiff alleges that as a result of Defendants misrepresentations, Powerwave common stock traded at artificially inflated prices during the Settlement Class Period in violation of the federal securities laws resulting in substantial damages to Settlement Class Members. The lawsuit seeks money damages against the Defendants for violation of the federal securities laws, specifically Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the Exchange Act ), and Rule 10b-5 promulgated thereunder by the Securities & Exchange Commission (the SEC ). Defendants deny that they did anything wrong. Defendants also deny that the Lead Plaintiff or the Settlement Class suffered damages or that the price of Powerwave common stock was artificially inflated due to the alleged misrepresentations, non-disclosures or otherwise. 3. Why Is this a Class Action? In a class action, one or more people called class representative(s) (in this case the Court-appointed Lead Plaintiff), sue on behalf of people who have similar claims. Here, all these people are called a Settlement Class or Settlement Class Members. One court resolves the issues for all class members, except for those who exclude themselves. Bringing a case such as this one as a class action allows adjudication of many similar claims of persons and entities that might be economically too small to bring in individual actions. 4. Why Is There a Settlement? The Court did not decide the merits of this case in favor of the Lead Plaintiff or Defendants. Instead, the parties participated in mediation at arm s length under the supervision of United States District Judge Nicholas H. Politan (Ret.) and agreed to a settlement. That way, they avoid the risks and costs of a trial, and eligible Settlement Class Members who submit valid claims will receive compensation. The Lead Plaintiff and his attorneys believe the Settlement is in the best interest of the Settlement Class Members. 5. Procedural History of the Litigation Beginning on January 17, 2007, four putative class actions were filed in the United States District Court for the Central District of California, (the Court ) on behalf of purchasers of common stock in Powerwave during the time period May 2, 2005 through October 9, 2006, and alleging violations of the federal securities laws. These actions were captioned Crafton v. Powerwave Technologies, Inc., et. al., Case No. SACV PSG, Kwan v. Powerwave Technologies, Inc. et al., Case No. SACV PSG; Tedesco v. Powerwave Technologies, Inc. et. al., Case No. SACV PSG; and Etemadieh v. Powerwave Technologies, Inc., et al., Case No. SACV JVX (RNBx) (the Actions ). Subsequently, these cases were consolidated, the Lead Plaintiff and Co-Lead Counsel for Plaintiffs were appointed pursuant to the Private Securities Litigation Reform Act of 1995 (the PSLRA ), and plaintiffs First Amended Consolidated Class Action Complaint (the FACC ) was filed. The FACC was brought on behalf of a putative class of public shareholders who purchased Powerwave common stock during the period from May 2, 2005 through November 2, 2006, inclusive, and against Defendants. The FACC alleged that the Defendants made material misrepresentations and/or material omissions about, among other things, Powerwave s purported financial condition, operations, accounting, growth, income, earnings and prospects. On December 11, 2007, Defendants filed a Motion to Dismiss the FACC in its entirety. On April 17, 2008, the Court granted in part and denied in part the Motion to Dismiss. Specifically, the Court sustained the Section 10(b) and Rule 10b-5 claims against Powerwave and the Section 20(a) claims against the Individual Defendants based on alleged misstatements in Powerwave s 2005 financial statements. However, the Court dismissed the Section 10(b) and Rule 10b-5 claims against Powerwave and all claims against the Individual Defendants based on Defendants revenue projections in 2006 on the ground that those projections were protected as forward-looking statements. The Court also dismissed the remaining claims against the Individual Defendants that alleged violations of Section 10(b) of the Exchange Act and SEC Rule 10b-5. On July 15, 2008, the Court denied Defendants Motion for Partial Reconsideration of the Court s April 17, 2008 Order. 4

5 Thereafter, Defendants answered the FACC, the parties filed initial disclosures pursuant to Federal Rule of Civil Procedure 26(a)(1) and the Lead Plaintiff propounded discovery and filed a motion for class certification. Between December 11, 2008 and January 8, 2009, Defendants produced approximately 55,000 pages of documents in response to Lead Plaintiff s First Request for the Production of Documents. On January 10, 2009, Defendants took the deposition of the Lead Plaintiff. On January 14, 2009, the parties participated in mediation at arm s length under the supervision of United States District Judge Nicholas H. Politan (Ret.), at which time this matter was resolved, subject to approval by the Court. On May 13, 2009, Plaintiffs Co-Lead Counsel conducted an interview of Powerwave s Vice President of Finance concerning the allegations of the FACC sustained by the Court. WHO IS IN THE SETTLEMENT To see if you potentially can get money from this Settlement, you first have to determine if you are a Settlement Class Member. 6. How Do I Know If I Am Part of the Settlement? The Court decided that everyone who fits this description is a Settlement Class Member: All persons who purchased or otherwise acquired the common stock of Powerwave Technologies, Inc., between May 2, 2005 and November 2, 2006, inclusive, and held shares purchased during that period through the close of trading on November 2, 2006, except those persons and entities that are excluded, as described below. 7. What Are the Exceptions to Being Included? You are not a Settlement Class Member if you are a Defendant, an entity in which any Defendant or any excluded Person has or had a controlling ownership interest, a current or former officer or director of Powerwave, a member of any such excluded person s immediate family, and the legal affiliates, representatives, heirs, controlling persons, successors, and predecessors in interest or assigns of any such excluded Person. The Settlement Class also excludes those Persons who timely and validly request exclusion from the Settlement Class pursuant to this Notice. If one of your mutual funds purchased shares of Powerwave common stock during the Settlement Class Period, that alone does not make you a Settlement Class Member. Only those shares of Powerwave common stock that were purchased directly or were acquired by way of corporate merger or acquisition may be included in your claim. Check your investment records or contact your broker to see if you purchased Powerwave common stock during the Settlement Class Period. If you sold Powerwave common stock during the Settlement Class Period, that alone does not make you a Settlement Class Member. You are a Settlement Class Member only if you purchased Powerwave common stock between May 2, 2005 and November 2, 2006, inclusive, and held shares purchased during that period through the close of trading on November 2, What If I Am Still Not Sure If I Am Included? If you are still not sure whether you are included, you can ask for free help. You can call Richard Brualdi toll free at (877) or Jordan Lurie at (310) for more information, you can contact the Claims Administrator toll free at (800) , or on its website at or you can fill out and return the claim form described in Question 11 below to see if you qualify. 5

6 9. What Does the Settlement Provide? THE SETTLEMENT BENEFITS WHAT YOU GET In exchange for the Settlement and dismissal of the Litigation, Defendants have agreed to pay $3,150,000 in cash to be divided among all eligible Settlement Class Members who send in valid claim forms showing a Recognized Claim, after the payment of Court-approved attorneys fees and expenses, any amount approved by the Court for reimbursement of the Lead Plaintiff for his time and expenses incurred in representing the Settlement Class and the costs of claims administration, which include the costs of printing and mailing this Notice, the cost of publishing notice and the cost of processing claims (the Net Settlement Fund ). 10. How Much Will My Payment Be? The $3,150,000 million cash settlement amount and the interest earned thereon shall be the Gross Settlement Fund. The Gross Settlement Fund less taxes, approved costs, fees and expenses (the Net Settlement Fund ) shall be distributed to members of the Settlement Class who submit valid Proofs of Claim ( Authorized Claimants ). The Claims Administrator, under the direction of Plaintiffs Co-Lead Counsel, shall determine each Authorized Claimant s proportionate share of the Net Settlement Fund based upon each Authorized Claimant s net Recognized Claim. The Recognized Claim formula is not intended to be an estimate of the amount of what a Settlement Class Member lost or might have been able to recover after a trial; nor is it an estimate of the amount that will be paid to Authorized Claimants pursuant to the Settlement. The Recognized Claim formula is simply the basis upon which the Net Settlement Fund will be proportionately allocated to Authorized Claimants. For the purposes of this Settlement, the Recognized Claims shall be calculated pursuant to the following Plan of Allocation: a. For shares of Powerwave common stock purchased or otherwise acquired from May 2, 2005 through November 2, 2006, and: (i) sold prior to the close of trading on November 2, 2006, the Recognized Claim per share is $0; (ii) sold during the period from November 3, 2006 through January 30, 2007, the Recognized Claim per share is the lesser of (a) $0.17 per share, or (b) the purchase price minus the Rolling Average Closing Price of Powerwave common stock on the date of sale, as indicated in Table 1 on page 8; (iii) retained at the close of trading on January 30, 2007, the Recognized Claim is the lesser of (i) $0.17 per share, or (ii) the purchase price minus $6.34 (the 90-day average closing price of Powerwave common stock from November 3, 2006 through January 30, 2007). b. To the extent that a Claimant realized a profit from overall market transactions in Powerwave common stock during the Settlement Class Period, the value of the final Recognized Claim shall be zero. To the extent that a Claimant sustained a loss from overall market transactions in Powerwave common stock during the Settlement Class Period, but that loss was less than the Recognized Claim computed above, the value of the final Recognized Claim shall be limited to the amount of the market loss. c. Market profits and losses for each share of Powerwave common stock shall be computed as the difference between the purchase price and the sale price for the shares purchased during the Settlement Class Period and sold during the period May 2, 2005 through January 30, 2007; and the difference between the purchase price and $6.34 for the shares purchased during the Settlement Class Period and retained through the close of trading on January 30, Market profits will be subtracted from market losses, both computed in this manner, in order to determine the net market profit or loss. 6

7 General Provisions: a The date of a purchase or sale of Powerwave common stock is the trade date, and not the settlement date. b. In processing claims, the first-in, first-out basis ( FIFO ) will be applied to both purchases and sales. c. Shares of Powerwave common stock acquired during the Settlement Class Period through the exercise of a call option shall be treated as a purchase on the date of exercise for the strike price plus the option premium. Shares of Powerwave common stock sold during the Settlement Class Period through the assignment of a call option shall be treated as a sale on the date of exercise for the strike price plus the option premium. Shares of Powerwave common stock acquired during the Settlement Class Period through the assignment of a put option shall be treated as a purchase on the date the put option was assigned for the strike price minus the option premium. Shares of Powerwave common stock sold through the exercise of a put option shall be treated as a sale on the date of exercise for the strike price minus the option premium. Shares of Powerwave common stock acquired pursuant to any Powerwave stock option plan shall have a Recognized Claim of zero. d. The receipt or grant by gift, devise or operation of law of Powerwave common stock during the Settlement Class Period shall not be deemed a purchase or sale of Powerwave common stock for the calculation of an Authorized Claimant s Recognized Claim. If, however, such stock was purchased during the Settlement Class Period by the donor, descendent or transferor, then the recipient s Recognized Claim will be computed by using the price of such stock on the original date of purchase and not the date of transfer. e. The receipt of Powerwave common stock during the Settlement Class Period in exchange for securities of any other company shall be deemed a purchase of Powerwave common stock on the date the acquisition closed at the closing price of Powerwave stock on that date. f. The price paid or received should exclude all commissions, taxes and fees. g. Shares originally sold short shall have a Recognized Claim of zero. h. All profits will be subtracted from all losses to determine the net Recognized Claim of each Authorized Claimant. i. No cash payment will be made on a claim where the potential distribution amount is $10 or less. j. The Court has reserved jurisdiction to allow, disallow or adjust the claim of any Settlement Class Member on equitable grounds. k. No person shall have any claim against Plaintiffs Co-Lead Counsel, the Claims Administrator or other agent designated by Plaintiffs Co-Lead Counsel, or any Defendant or any Defendant s counsel based on the distribution made substantially in accordance with the Stipulation and this Plan of Allocation, or further orders of the Court. l. Settlement Class Members who do not submit valid Proofs of Claim will not share in the Settlement proceeds. Settlement Class Members who do not either submit a request for exclusion or submit a valid Proof of Claim will nevertheless be bound by the terms of this Settlement. m. Distributions will be made to Authorized Claimants after all claims have been processed and after the Court has finally approved the Settlement. If any funds remain in the Net Settlement Fund by reason of uncashed checks or otherwise, then, after the Claims Administrator has made reasonable and diligent efforts to have Settlement Class Members who are entitled to participate in the distribution of the Net Settlement Fund cash their distributions, any balance remaining in the Net Settlement Fund one (1) year after the initial distribution of such funds shall be re-distributed to Settlement Class Members who have cashed their initial distributions and who would receive at least $10 from such re-distribution, after payment of any unpaid costs or fees incurred in administering the Net Settlement Fund for such re-distribution. If after six months after such re-distribution any funds shall remain in the Net Settlement Fund, then such balance shall be contributed to non-sectarian, not-for-profit, 501(c)(3) organization(s) approved by the Court. 7

8 Table 1 Rolling Average Rolling Average Date Closing Price Date Closing Price 11/3/06 $ /15/06 $ /6/ /18/ /7/ /19/ /8/ /20/ /9/ /21/ /10/ /22/ /13/ /26/ /14/ /27/ /15/ /28/ /16/ /29/ /17/ /3/ /20/ /4/ /21/ /5/ /22/ /8/ /24/ /9/ /27/ /10/ /28/ /11/ /29/ /12/ /30/ /16/ /1/ /17/ /4/ /18/ /5/ /19/ /6/ /22/ /7/ /23/ /8/ /24/ /11/ /25/ /12/ /26/ /13/ /29/ /14/ /30/ HOW TO GET A PAYMENT-SUBMITTING A PROOF OF CLAIM FORM 11. How Can I Get a Payment? To qualify for a payment, you must be an eligible Settlement Class Member, send in a valid Proof of Claim and Release form and properly document your claim as requested in the form. A Proof of Claim and Release form is enclosed with this Notice. You may also download a Proof of Claim and Release form from the Claims Administrator s website at Read the instructions carefully, fill out the Proof of Claim and Release form, include all the documents the form asks for, sign it and mail it to the address on the front page of the form postmarked no later than November 4, When Would I Get My Payment? The Court will hold a hearing on October 19, 2009, to decide whether to approve the Settlement. If the Court approves the Settlement after that, there may be appeals. It is always uncertain whether these appeals can be resolved favorably, and resolving them can take time, perhaps several years. It also takes time for all the Proofs of Claim to be processed. Please be patient. 8

9 13. What Am I Giving up to Get a Payment? Unless you exclude yourself, you are staying in the Settlement Class, and that means you cannot sue, continue to sue, or be part of any other lawsuit against the Defendants about the Released Claims (as defined below) in this case. It also means that all of the Court s orders will apply to you and legally bind you and you will release all Released Claims (defined below) against the Released Persons (defined below) upon the Effective Date (defined below). The terms of the release are included in the enclosed Proof of Claim and Release form. Released Claims means and includes any and all claims, rights, demands, liabilities and causes of actions, including Unknown Claims (defined below), whether based on federal, state, local, statutory or common law or any other law, rule or regulation, whether known or unknown, suspected or unsuspected, fixed or contingent, accrued or un-accrued, liquidated or un-liquidated, matured or un-matured, class or individual in nature, that have been, might have been, or could be asserted (or threatened, alleged, or litigated) at law, in equity, or otherwise, at any time against any of the Released Parties by any Member of the Settlement Class, in any capacity, in the Litigation and which arises out of or relates in any way whatsoever to: (a) purchases or sales of Powerwave common stock during the Settlement Class Period; (b) the allegations, transactions, facts, matters or occurrences, representations or omissions involved, set forth, referred to or that could have been asserted in the FACC; or (c) any alleged misrepresentation or omission occurring during the Settlement Class Period concerning or relating to the financial condition, results of operations, financial statements, press releases, public filings, or any public disclosures by Powerwave or any of the Released Parties relating in any way to Powerwave; or (d) this Settlement or the entry into it, except for breach of this Settlement. Excluded from the Released Claims are any claims asserted derivatively on behalf of Powerwave in Cucci v. Powerwave Technologies Inc., et. al., Case No. SACV PSG (C.D. Cal.). Unknown Claims means any and all Released Claims that Lead Plaintiff or any Settlement Class Member do not know or suspect to exist in his, her or its favor at the time of the release of the Released Parties, and any claims against Lead Plaintiff, any Settlement Class Member or Plaintiffs Co-Lead Counsel which any Defendant does not know or suspect to exist in their favor as of the Effective Date, which if known, might have affected his, her or it(s) decision(s) with respect to the Settlement and/or the release of the Released Parties. With respect to any and all such claims, the parties stipulate and agree that upon the Effective Date, Lead Plaintiff and Defendants shall expressly, and each Settlement Class Member shall be deemed to have, and by operation of the Final Judgment shall have, waived any and all provisions, rights and benefits conferred by any law of any state or territory of the United States, or principle of common law, or international or foreign law, which is similar, comparable, or equivalent to California Civ. Code 1542, which provides: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. Upon the Effective Date, Defendants, Lead Plaintiff and each of the Settlement Class Members shall be deemed to have, and by operation of Judgment shall have, expressly waived any and all provisions, rights, and benefits conferred by any law of any state or territory of the United States, or principle of common law or international or foreign law, which is similar, comparable, or equivalent to California Civil Code Defendants, Lead Plaintiff and Settlement Class Members may hereafter discover facts in addition to or different from those which they now know or believe to be true with respect to the subject matter of the Released Claims, but upon the Effective Date, Defendants and Lead Plaintiff shall expressly, and each Settlement Class Member shall be deemed to have, fully, finally, and forever settled and released any and all Released Claims, known or unknown, suspected or unsuspected, contingent or non-contingent, liquidated or unliquidated, matured or unmatured, apparent or unapparent, whether or not concealed or hidden, which now exist, or heretofore have existed, upon any theory of law or equity now existing or coming into existence in the future, including, but not limited to, conduct which is negligent, intentional, with or without malice, or a breach of any duty, law, or rule, without regard to the subsequent discovery or existence of such different or additional facts. The Settling Parties acknowledge, and Settlement Class Members shall be deemed by operation of the Judgment to have acknowledged, that the foregoing waiver was separately bargained for and a material element of the Settlement of which this release is a part. 9

10 The Released Parties means each and all of the Defendants and each of a Defendant s past or present successors, parents, subsidiaries and affiliates, and their respective directors, officers, employees, partners, agents, underwriters, insurers, co-insurers, re-insurers, controlling shareholders, attorneys, accountants, auditors, banks, investment banks, consultants, associates, personal or legal representatives, predecessors, successors, assigns, spouses, heirs, parents, subsidiaries, related or affiliated entities, joint ventures, any entity in which any Defendant has a controlling interest, any member of any Individual Defendant s immediate family, or any trust of which any Individual Defendant is the settler or which is for the benefit of any Individual Defendant s family. The Effective Date will occur when an Order entered by the Court approving the Settlement becomes final and not subject to appeal. 14. Can I Exclude Myself from the Settlement Class? Yes. If you do not want to receive a payment from this Settlement, but you want to keep the right to sue or continue to sue the Defendants on your own for the Released Claims in this case, then you must take steps to get out of the Settlement Class. This is called excluding yourself or is sometimes referred to as opting out of the Settlement Class. If you do not wish to be included in the Settlement Class and you do not wish to participate in the proposed Settlement described in this Notice you may request to be excluded. To exclude yourself from the Settlement Class, you must send a letter by mail stating that you want to be excluded from Crafton v. Powerwave Technologies, Inc., et al., Case No. SACV PSG (MLGx), postmarked no later than October 5, 2009 to the Claims Administrator at the address below. You must include: (a) your name, current address, day-time or evening telephone numbers and your signature; (b) the number of shares of Powerwave common stock you purchased and/or sold during the Settlement Class Period and the dates and prices of such purchase(s) and/or sale(s); and (c) a clear and unambiguous statement that you wish to be excluded from the Settlement Class. The request for exclusion must be addressed to the Claims Administrator as follows: Powerwave Technologies Securities Litigation EXCLUSION c/o Berdon Claims Administration LLC P.O. Box 9014 Jericho, NY NO REQUEST FOR EXCLUSION WILL BE CONSIDERED VALID UNLESS ALL OF THE INFORMATION DESCRIBED ABOVE IS INCLUDED IN ANY SUCH REQUEST. You cannot exclude yourself on the phone or by . If you validly request exclusion from the Settlement Class: (a) you will be excluded from the Settlement Class, (b) you will not share in the proceeds of the Settlement described herein, (c) you will not be bound by any judgment entered in the Litigation, and (d) you will not be precluded, by reason of your decision to request exclusion from the Settlement Class, from otherwise prosecuting an individual claim, if timely, against the Defendants based on the matters complained of in the Litigation. 15. If I Do Not Exclude Myself, Can I Sue the Defendants for the Same Thing Later? No. Unless you exclude yourself, you give up any right to sue the Defendants for the Released Claims in this Settlement. If you have a pending lawsuit against any of the Defendants, speak to your lawyer in that case immediately. Remember, the exclusion request must be postmarked no later than October 5, If I Exclude Myself, Can I Receive Money from this Settlement? No. If you exclude yourself, you will not be a part of this Settlement, and you will not receive any money from this Settlement. Accordingly, if you decide to exclude yourself, you should not submit a claim form. But, you may sue, continue to sue, or be part of a different lawsuit involving the Released Claims against the Defendants. 10

11 17. Can I Change My Mind about Excluding Myself? Yes. Even if you have already submitted a request for exclusion, if you change your mind and decide that you do want to be included in the Settlement Class and participate in the proposed Settlement described in this Notice, you may retract or withdraw your original request. To do so, you must state in writing that you wish to retract or withdraw the request for exclusion previously submitted, and include your name, address and signature. Submit your statement to the Claims Administrator by mail at: Powerwave Technologies Securities Litigation RETRACTION c/o Berdon Claims Administration LLC P.O. Box 9014 Jericho, NY or by fax: (516) To obtain the address you may use for overnight mail, call the Claims Administrator toll free at (800) To be valid, your retraction must be received no later than October 15, Do I Have a Lawyer in this Case? THE LAWYERS REPRESENTING THE CLASS The Court ordered that the law firms of The Brualdi Law Firm, P.C., New York, New York and Weiss & Lurie, Los Angeles, California will represent you and the other Members of the Settlement Class. These lawyers are called Plaintiffs Co-Lead Counsel. You will not be separately charged for these lawyers. If you want to be represented by your own lawyer, you may hire one at your own expense. 19. How Will the Lawyers Be Paid? Plaintiffs Co-Lead Counsel will ask the Court for attorneys fees in an amount not to exceed 33 1/3% of the Settlement Fund and for reimbursement of their expenses in the approximate amount of $295,000, which counsel advanced in connection with the Litigation, plus interest on such expenses at the same rate as earned by the Settlement Fund, to be paid from the Settlement Fund. The Lead Plaintiff also will ask the Court for reimbursement for his costs and expenses (including lost wages) incurred in representing the Settlement Class not to exceed $30,000, also to be paid from the Settlement Fund. Settlement Class Members are not personally liable for any such fees or expenses. The attorneys fees and expenses requested will be the only payment to Plaintiffs Co-Lead Counsel for their efforts in achieving this Settlement and for their risk in undertaking this representation on a wholly contingent basis. Plaintiffs Co-Lead Counsel have committed a significant amount of time and substantial expenses in litigating this case for the benefit of the Settlement Class since its inception in To date, Plaintiffs Co-Lead Counsel have not been paid for their services in conducting this Litigation on behalf of the Lead Plaintiff and the Settlement Class, nor for their substantial expenses incurred in the Litigation. The fees requested will compensate counsel for the Lead Plaintiff for their work in achieving this Settlement and are well within the range of fees awarded to class counsel under similar circumstances in other cases of this type. The Court may award less than the amounts requested. The Court may also without further notice to the Settlement Class approve payment of the Claims Administrator s fees and expenses incurred in connection with giving notice, administering the Settlement and distributing the Settlement proceeds to the Members of the Settlement Class. 11

12 OBJECTING TO THE SETTLEMENT You can tell the Court that you do not agree with the Settlement or some part of it. 20. How Do I Tell the Court That I Do Not like the Settlement? If you are a Settlement Class Member you can object to the Settlement if you do not like any part of it. You may write to the Court setting out your objection and give reasons why you think the Court should not approve any or all of the Settlement terms. The Court will consider your views. To object, you must send a signed letter or other document stating that you object to the proposed Settlement in Crafton v. Powerwave Technologies, Inc., et. al., Case No. SACV PSG (MLGx) within the deadline identified below and according to the following procedures. Be sure to include your name, address, telephone number, and your signature, the date(s), price(s), and number(s) of shares of all purchases and sales of Powerwave common stock you made during the Settlement Class Period, and state the reasons why you object to the Settlement. Your objection must be mailed or delivered such that it is filed with the Clerk of the Court and served on each of the following counsel no later than October 5, 2009: COURT PLAINTIFFS CO-LEAD COUNSEL Clerk of the Court Richard B. Brualdi, Esq. United States District Court The Brualdi Law Firm, P.C. for the Central District of California 29 Broadway, Suite 2400 Western Division New York, NY Roybal Federal Building and U.S. Courthouse Jordan L. Lurie, Esq. 255 East Temple Street Weiss & Lurie Los Angeles, CA Wilshire Boulevard, Suite 2300 Los Angeles, CA DEFENDANTS COUNSEL Seth Aronson, Esq. Amy Jane Longo, Esq. O Melveny & Myers LLP 400 South Hope Street Los Angeles, CA You do not need to go to the Settlement Fairness Hearing to have your written objection considered by the Court. At the Settlement Fairness Hearing, any Settlement Class Member who has not previously submitted a request for exclusion from the Settlement Class and who has complied with the procedures set out in this Question 20 below for filing with the Court and providing to Plaintiffs Co-Lead Counsel and to Defendants Counsel a statement of an intention to appear at the Settlement Fairness Hearing may also appear and be heard, to the extent allowed by the Court, to state any objection to the Settlement, the Plan of Allocation, Lead Plaintiff s application for reimbursement of his costs and expenses (including lost time) incurred in representing the Settlement Class or Plaintiffs Co-Lead Counsel s request for an award of attorneys fees and reimbursement of expenses. Any such objector may appear in person or arrange, at that objector's expense, for a lawyer to represent the objector at the Settlement Fairness Hearing. 21. What Is the Difference Between Objecting and Excluding? Objecting is simply telling the Court that you do not like something about the Settlement. You can object only if you stay in the Settlement Class. Excluding yourself is telling the Court that you do not want to be part of the Settlement Class. If you exclude yourself, you have no basis to object because the case no longer affects you. 12

13 THE COURT S SETTLEMENT FAIRNESS HEARING The Court will hold a hearing to decide whether to approve the Settlement. You may attend and you may ask to speak, but you do not have to. 22. When and Where Will the Court Decide Whether to Approve the Settlement? The Court will hold a Settlement Fairness Hearing at 2:30 p.m. on Monday, October 19, 2009 at the United States District Court for the Central District of California, Western Division, Roybal Federal Building and U.S. Courthouse, 255 East Temple Street, Los Angeles, CA At this hearing the Court will consider whether the Settlement is fair, reasonable and adequate. Judge Gutierrez also will consider the proposed Plan of Allocation of the Net Settlement Fund, the application of Lead Plaintiff for reimbursement for his costs and expenses incurred in representing the Settlement Class and the application of Plaintiffs Co-Lead Counsel for attorneys fees and reimbursement of expenses. If there are any objections filed in accordance with the instructions and deadline identified above at Question 20, the Court will consider them. The Court also may listen to people who have properly requested, within the deadline identified above, to speak at the hearing; but decisions regarding the conduct of the hearing will be made by the Court. See Question 24 for more information about speaking at the hearing. The Court may decide these issues at the hearing or take them under consideration and issue an order later. We do not know how long these decisions will take. You should be aware that the Court may change the date and time of the Settlement Fairness Hearing without any further notice. Thus, if you want to come to the hearing, you should check with Plaintiffs Co- Lead Counsel before coming to be sure that the date and/or time has not changed. 23. Do I Have to Come to the Hearing? No. Plaintiffs Co-Lead Counsel will answer questions the Court may have. But, you are welcome to come at your own expense. If you send an objection, you are not required to come to Court to talk about it. As long as you mailed your written objection on time, the Court will consider it. You may also pay your own lawyer to attend, but it is not required. Settlement Class Members are not required to appear at the hearing or take any other action to indicate their approval, although they may do so if they wish. 24. May I Speak at the Hearing? You may ask the Court for permission to speak at the Settlement Fairness Hearing. To do so, you must include with your objection (see Question 20 above) a statement stating that it is your intention to appear in Crafton v. Powerwave Technologies, Inc., et al., Case No. SACV PSG. Be sure to include your name, address, telephone number, your signature and the number of shares of Powerwave common stock acquired between May 2, 2005 and November 2, 2006 and retained through the close of trading on November 2, Your notice of intention to appear must be mailed or delivered such that it is filed with the Clerk of the Court and served on each of Plaintiffs Co-Lead Counsel and the counsel for the Defendants no later than October 5, You cannot speak at the hearing if you exclude yourself from the Settlement Class. Persons who intend to object to the Settlement, the Plan of Allocation, and/or counsel's application for an award of attorneys fees and expenses and who wish to present evidence at the Settlement Fairness Hearing must include in their written objections the identity of any witnesses they may call to testify and exhibits they intend to introduce into evidence at the Settlement Fairness Hearing. 25. What Happens If I Do Nothing at All? IF YOU DO NOTHING If you do nothing, you will get no money from this Settlement. But, unless you exclude yourself, you won t be able to start a lawsuit, continue a lawsuit or be part of any other lawsuit against the Defendants and the other Released Parties about the Released Claims ever again. 13

14 26. Are There More Details about the Settlement? This Notice summarizes the Settlement. More details are in the Stipulation and Agreement of Settlement dated May 14, 2009 (the Stipulation ). You can get a copy of the Stipulation by writing to Richard B. Brualdi, Esq., The Brualdi Law Firm, P.C., 29 Broadway, Suite 2400, New York, New York or Jordan Lurie, Esq., Weiss & Lurie, Wilshire Boulevard, Suite 2300, Los Angeles, California You also can contact the Claims Administrator: by mail at Powerwave Technologies Securities Litigation, c/o Berdon Claims Administration LLC, P.O. Box 9014, Jericho, NY ; by toll free phone at (800) ; by fax at (516) to help you determine whether you are a Settlement Class Member and whether you are eligible for a payment; or visit the Claims Administrator s website at where you will find a Proof of Claim and Release form, plus other information. 27. How Do I Get More Information? For even more detailed information concerning the matters involved in this Action, you can refer to the pleadings, to the Stipulation, to the Orders entered by the Court and to the other papers filed in the Litigation, which may be inspected at the Office of the Clerk of the United States District Court for the Central District of California, Western Division, Roybal Federal Building and U.S. Courthouse, 255 East Temple Street, Los Angeles, CA 90012, during regular business hours. DO NOT TELEPHONE THE COURT REGARDING THIS NOTICE SPECIAL NOTICE TO SECURITIES BROKERS AND OTHER NOMINEES The Court has ordered that if you held shares of Powerwave (NASDAQ National Market symbol PWAV ; CUSIP ) common stock acquired during the period between May 2, 2005 to November 2, 2006, inclusive, as a nominee for a beneficial owner other than yourself, then, after seven (7) days after you receive this Notice, you must either: (a) send a copy of this Notice by first class mail to all such Persons or organizations; or (b) provide to the Claims Administrator the names and last known addresses of all such Persons or organizations, preferably in an MS Excel data table setting forth: (i) title/registration, (ii) street address, (iii) city/state/zip; or on electronic mailing labels in MS or WordPerfect files; or printed out on physical mailing labels sent to: Powerwave Technologies Securities Litigation c/o Berdon Claims Administration LLC P.O. Box 9014 Jericho, NY Fax: (516) Website: If you choose to mail the Notice and Proof of Claim and Release form yourself, you may obtain from the Claims Administrator (without cost to you) as many additional copies of the documents as you will need to complete the mailing and provide the Claims Administrator with written confirmation that the mailing was made as directed. Regardless whether you choose to complete the mailing yourself or elect to have the mailing performed for you, you may obtain reimbursement for reasonable administrative costs actually incurred or expected to be incurred in connection with forwarding the Notice and which would not have been incurred but for the obligation to forward the Notice. Those expenses will be paid after request and submission of appropriate supporting documentation. All communications concerning the foregoing should be addressed to the Claims Administrator at the address above. Dated: August 12, 2009 BY ORDER OF THE UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA 14