**UNITED STATES**

**SECURITIES AND EXCHANGECOMMISSION**

**Washington D.C. 20549**

 

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**FORM 10-K/A**

 

**(Amendment No. 1)**

 

**(Mark one)**

**ý****      ****ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934**

 

**For the fiscal year endedJune 30, 2004**

** **

**or**

** **

**o****      ****TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934**

** **

**For the transition period from         to         **

 

**Commission File Number 000-1095478**

 

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**INTERWAVE COMMUNICATIONSINTERNATIONAL LTD.**

(Exact name of registrant asspecified in its charter)

 

| **Bermuda**                                                                                 | ** ** |                     |       | **98-0155633**                   |
|--------------------------------------------------------------------------------------------------|------------|--------------------------|------------|---------------------------------------|
| (State or other jurisdiction of  incorporation or organization)                                  | ** ** | ** **               |       | (I.R.S. Employer  identification No.) |
|                                                                                             | ** ** | ** **               |       |                                  |
| **Clarendon House, 2 Church Street**  **P.O. Box HM 1022****Hamilton HM DX, Bermuda**  | ** ** | **Not Applicable**  | ** ** | **441-295-5950**                 |
| (Address of principal executive offices)                                                         | ** ** | (Zip code)               | ** ** | (Telephone Number)                    |

 

| Title of each class                          |   | Name of each exchange on which registered |
|----------------------------------------------|--------|-------------------------------------------|
| **Common Shares, par value $0.01 per share** |   | **NASDAQ**                                |

 

Securities registered pursuant to Section 12(g) of the Act:

Common Shares, par value $0.01 per share

(Title of class)

 

Indicate by check mark whether Registrant (1) has filed allreports required to be filed by Section 13 or 15(d) of the SecuritiesExchange Act of 1934 during the preceding 12 months (or for such shorterperiod that the Registrant was required to file such reports), and (2) hasbeen subject to such filing requirements for the past 90 days.  Yes ý  No o

 

Indicate by check mark if disclosure of delinquent filers pursuant toItem 405 of Regulation S-K is not contained herein, and will not becontained, to the best of Registrant’s knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of thisForm 10-K or any amendment to this Form 10-K. o

 

Indicate by check mark whether Registrant is an accelerated filer (asdefined in Rule 12b-2 of the Act). Yes  ̈ No x

 

Aggregate market value of the voting and non-voting common shares heldby non-affiliates of the Registrant, based upon the closing price per share of$4.41 on December 31, 2003 on the NASDAQ was $20.9 million.  Calculation of holdings by non-affiliates ofthe Registrant is based upon the assumption, for these purposes only, thatexecutive officers, directors, nominees, and persons holding 5% or more ofRegistrant’s outstanding common shares are affiliates.  Number of outstanding Common Shares of theRegistrant on August 25, 2004: 9,185,765.

 

DOCUMENTS INCORPORATED BYREFERENCE:

None.

 

 

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**EXPLANATORY NOTE**

 

We are filing this Amendment No. 1 (this “Amendment”)to Registrant’s Annual Report on Form 10-K/A to provide the informationrequired by Part III, including Items 10, 11, 12, 13 and 14, and to replaceExhibit 23.2 to the Original Form 10-K (as defined below).  In our original Annual Report on Form 10-K,filed on October 13, 2004 (the “Original Form 10-K”), we incorporated much ofthe information required by Part III by reference to our proxy statement forour 2004 annual meeting of shareholders. We anticipate closing our pending amalgamation with Alvarion Ltd.prior to holding our annual shareholder meeting in 2004 and therefore do notanticipate filing a proxy statement at this time.

 

This Amendment only amends PartIII of the Original Form 10-K as set forth herein.  All incorporations by reference to the proxystatement within Part III are hereby deleted. Unaffected items contained within Items 10 through 14 and all otheritems in the Original Form 10-K have not been repeated in this Amendment.  This report still speaks as of the filingdate of the Original Form 10-K and, except as expressly stated herein, noattempt has been made to update this report to reflect events occurringsubsequent to the initial filing date of the Original Form 10-K.  All information contained in this Amendmentis subject to updating and supplementing, as provided in our periodic reportsfiled with the Securities and Exchange Commission subsequent to the date of thefiling of the Original Form 10-K.

 

This Amendment includes amendedExhibit 23.2, which replaces the original Exhibit 23.2 filed with theOriginal Form 10-K.

 

**TABLE OF CONTENTS**

 
| ** **    | ** **                                                                                       | ** ** |
|---------------|--------------------------------------------------------------------------------------------------|------------|
| PART III |                                                                                             |       |
| Item  10.     | Directors  and Executive Officers of the Registrant                                              | 3          |
| Item 11.      | Executive Compensation                                                                           | 7          |
| Item  12.     | Security  Ownership of Certain Beneficial Owners and Management and Related Stockholder  Matters | 11         |
| Item 13.      | Certain Relationships and  Related Transactions                                                  | 13         |
| Item 14.      | Principal Accountant Fees and  Services                                                          | 15         |

 

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**PART III**

 

 

**Item 10.  Directors and Executive Officers of theRegistrant**

 

*Executive Officers and Directors*

 

The following table sets forth certain information regarding ourexecutive officers and directors as of October 19, 2004:

 
| **Name**                       | ** ** | **Age** | ** ** | **Position**                                       |
|--------------------------------|------------|---------|------------|----------------------------------------------------|
| William  E. Gibson             |       | 64      |       | Chairman  of the Board of Directors                |
| Erwin  F. Leichtle             |       | 55      |       | President,  Chief Executive Officer and Director   |
| Cal  R. Hoagland               |       | 48      |       | Senior  Vice President and Chief Financial Officer |
| Lars  Lindell                  |       | 40      |       | Vice  President and General Manager, CDMA Division |
| Padraig  Stapleton             |       | 36      |       | Vice  President of Engineering                     |
| Thomas  R. Gibian (1)          |       | 51      |       | Director                                           |
| Pratap  K. Kondamoori          |       | 43      |       | Director                                           |
| Dr.  Priscilla M. Lu           |       | 52      |       | Director                                           |
| Dr.  Nien Dak Sze (1) (2) |       | 57      |       | Director                                           |
| Dr.  Andrew C. Wang (1) (2)    |       | 67      |       | Director                                           |
| Dr.  Ker Zhang                 |       | 40      |       | Director                                           |

 

_____________________

(1)                                  Member of the Audit Committee.

 

(2)                                  Member of the Compensation Committee.

 

***Mr. William E. Gibson*** has served on our Board of Directors sinceJune 2001 and as Chairman of the Board since November 2003. Mr. Gibson wasa co-founder of Wireless, Inc. and served as Chairman of the board ofdirectors of Wireless since its inception in May 1997 until itsacquisition by interWAVE in June 2001. Prior to October 1999,Mr. Gibson also served as the President and Chief Executive Officer ofWireless. Mr. Gibson is the founder and has served as Managing Member ofCrossroads Venture Capital LLC, a private equity fund, since its inception inOctober 1996 and serves as Managing Partner of several private equityfunds of which Crossroads Venture Capital LLC is the General Partner.Mr. Gibson was a founder of Digital Microwave Corporation, a manufacturerof high-frequency digital microwave radios, and served as its President andChief Executive Officer from 1984 through 1991 and as President of DMC TelecomInternational from August 1991 until June 1995.  Mr. Gibson also currently serves as thePresident and Chief Executive Officer of Mobicom Corporation, a designer of GSMcellular telephone handsets. Prior to 1984, Mr. Gibson held variousmanagement positions at the Farinon division of Harris Corporation, amanufacturer of digital microwave radios, including Vice President and GeneralManager. Mr. Gibson also currently serves on the board of directors of severalprivately-held companies. Mr. Gibson holds a M.B.A. and a B.S. inEngineering from the College of Notre Dame.

 

***Mr. Erwin F. Leichtle*** has served as our President and ChiefExecutive Officer since July 2003 and on our Board of Directors sinceAugust 2003. From January 2002 to June 2003, Mr. Leichtle wasVice President and General Manager of Ericsson’s Eastern Europe and CentralAsia region. From October 1997 to December 2001, he was VicePresident, General Manager for Strategic Accounts, and Global Account Executivefor the WorldCom account, and reported to the Chief Executive Officer ofEricsson North America.  From 1985 to1997, Mr. Leichtle held other various senior management positions atEricsson, as well as at other companies such as Motorola and Compania Nacionalde Telefonos in Chile. Mr. Leichtle holds an M.S. in electrical engineeringfrom Royal Institute of Technology in Stockholm, Sweden, and a B.S. inElectrical Engineering from Technical University in Chile, and also attendedpostgraduate General Management and Leadership training at London BusinessSchool. Mr. Leichtle also served as a researcher at the Royal Institute of

 

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Technology in Stockholm Swedenbetween 1979 and 1984.

 

***Cal R. Hoagland*** has served as our Senior Vice President andChief Financial Officer since June 2003. Mr. Hoagland has served asour Chief Financial Officer since joining us in August 2001. FromMarch 1999 to June 2001, Mr. Hoagland served as Treasurer atPersistence Software, a caching software company. From July 1998 toMarch 1999, Mr. Hoagland served as Chief Financial Officer for Phasecom, acable modem company. From July 1997 to July 1998, Mr. Hoaglandwas Chief Financial Officer for Accom, a video caching company. FromApril 1995 to May 1997, Mr. Hoagland was Corporate Controller forADAC Laboratories, a medical imaging equipment company. Mr. Hoagland wasalso a former Audit Manager with Coopers & Lybrand, nowPricewaterhouseCoopers. Mr. Hoagland is a member of the Financial ExecutivesInstitute, a Certified Public Accountant and currently serves as an advisoryboard member to Santa Clara University’s School of Business AccountingDepartment. Mr. Hoagland holds a B.S. in Business Administration from SanJose State University.

 

***Lars Lindell***has served as our Vice President and GeneralManager of the CDMA Division since December 2003. From February 2002 to August2003, Mr. Lindell was a partner and director of Gilde IT, a Netherlands-basedinvestment management company, where he structured and negotiated technologyinvestments. From May 2000 to November 2001, Mr. Lindell was a partner andco-founder of nCoTec Ventures, where he structured and negotiatedtelecommunications technology investments. From June 1999 to May 2000, Mr. Lindell was Vice President, EquityResearch at Salomon Smith Barney, where he was responsible for researchcoverage of the telecommunications equipment sector. From December 1989 to June1998, Mr. Lindell held various positions with LM Ericsson, including positionsin Sweden, Japan, the United Kingdom and Mexico, where he was a director withresponsibility for wireless infrastructure equipment sales. Mr. Lindell holdsan M.B.A. from University of Cambridge, England and a Master of Science inElectrical Engineering with specialization in Telecommunications from LundInstitute of Technology, Sweden.

 

***Padraig Stapleton*** has served as our Vice President ofEngineering since August 2003. From September 1998 to July 2003,Mr. Stapleton served as our Director of Software Development. FromJune 1998 to August 1998, Mr. Stapleton was a consultant forCisco Systems in its internet telephony service unit. From October 1995 toJune 1998, Mr. Stapleton held managerial positions with SatCom Mediaand Centigram. Mr. Stapleton graduated with honors in Electronic Engineeringfrom the University of Limerick in Ireland.

 

***Mr. Thomas R. Gibian*** has served on our Board of Directors sinceMay 2000. Mr. Gibian has been a Managing Director for EmergingMarkets Partnership (EMP) and Chief Operating Officer for the AmericanInternational Group (AIG) African Infrastructure Fund since 1995. From 1987 to1995, Mr. Gibian was employed by Goldman Sachs Limited as an ExecutiveDirector and co-head of structured finance for the Asia-Pacific Region.Mr. Gibian is a director of several privately-held companies. Mr. Gibianholds a B.A. from the College of Wooster in Wooster, Ohio, and an M.B.A. fromthe Wharton School of Finance, University of Pennsylvania.

 

***Pratap K. Kondamoori*** has served on our Board of Directors since December 2003.  Since November 2000, Mr. Kondamoori hasserved as a partner at Charter Ventures, and has served as Chairman and ChiefExecutive Officer of Xalted Networks, a private company providing broadbandaccess technologies, since 1999. Mr. Kondamoori holds a B.S. in Engineeringfrom Clemson University and is a charter member of TiE (formerly known as TheIndus Entrepreneurs, a non-profit global network of entrepreneurs andprofessionals founded in 1992 in Silicon Valley).

 

***Dr. Priscilla M. Lu*** has served on our Board of Directors since 1994.  Dr. Lu founded Interwave in 1994 and servedas Chairwoman of the Board until October 2003. Dr. Lu also served as ourChief Executive Officer from June 1994 to February 2003 and as itsPresident from June 1994 to August 1999. Dr. Lu is currently an advisorto Mayfield Funds. From 1992 to 1994, Dr. Lu was Vice President andGeneral Manager of the Network Systems Division at Network EquipmentTechnologies, a wide-area network equipment provider. From June 1976 toDecember 1991, Dr. Lu worked for AT&T Bell Laboratories, a unitof AT&T that is now 

 

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LucentTechnologies, where she served as Business Unit Managing Director of theImaging and Multimedia Business Group and held other management positions.Dr. Lu serves on the Dean’s Advisory Board of California StateUniversity-San Francisco and the Dean’s Advisory Board of the School ofEngineering of Northwestern University. Dr. Lu holds a B.S. and M.S. inComputer Science and Mathematics from the University of Wisconsin and a Ph.D.in Electrical Engineering and Computer Science from Northwestern University.

 

***Dr. Nien Dak Sze*** has served on our Board of Directors sinceMay 2001. Dr. Sze is currently Chairman of Atmospheric andEnvironmental Research Inc., a company he founded in 1977. AER is aleading research and consulting firm specializing in atmospheric, space andenvironmental science and technology. Since 1999, Dr. Sze has been projectmanager and coordinator of Project 2022, a major regional study on HongKong/Pearl River Delta’s environment, infrastructure and urban planning aimedat enhancing the region’s competitive advantages. From 1997 to 2000,Dr. Sze was a board member on Atmospheric Sciences and Climate for the USNational Academy of Sciences and US National Research Council. From 1995 to1998, Dr. Sze was a Science and Technical Advisor of the StateEnvironmental Protection Agency of the People’s Republic of China. Dr. Szeholds a Ph.D. in Applied Mathematics from Harvard University and a B.S. inEngineering Sciences from Purdue University.

 

***Dr. Andrew C. Wang*** has served on our Board of Directors since1994. Dr. Wang has been Chairman of Industrial Technology InvestmentCorporation, a venture capital firm, since 1989. Dr. Wang was Chairman ofTaiwan Mask Corporation, a semiconductor manufacturer, from 1989 to 2000. From1992 to 1997, Dr. Wang was President and Chief Executive Officer ofOptical Microwave Network, Inc., a microwave component company. From 1994to 1997, Dr. Wang was Chairman and Chief Executive Officer of Mobile Telesystems, Inc.,a satellite communications company.   Dr.Wang has served as a director on OmniVision Technologies, Inc. (NASDAQ:  OVTI) since January 2004. Dr. Wang holdsa B.S. in Electrical Engineering from the National Taiwan University, a M.S. inElectrical Engineering from the University of California, Berkeley, and a Ph.D.in Electrical Engineering from Stanford University.

 

***Dr. Ker Zhang*** has served on our Board of Directors sinceAugust 2003 and since July 2001 has served as Chief Executive Officer of VIATelecom, Inc., a leading developer of CDMA subscriber chipsets. Prior tojoining VIA Telecom, Inc., Dr. Zhang foundedSynchronization, Inc. in July 1997 and served as its Chief ExecutiveOfficer until December 2000. From 1999 to 2001, he also was the General Managerof the Mobile Subscriber Group of Eastern Communications Co., Ltd. inHangzhou, China. Prior to 1997, Dr. Zhang was Vice President and GeneralManager of the Multimedia Communications Group of Microtek International andheld management and engineering positions at Motorola and the semiconductorgroup of Rockwell International (now Skyworks). Dr. Zhang holds a Ph.D.degree from Worcester Polytechnic Institute in Massachusetts. He is a seniormember of the Institute of Electrical and Electronics Engineers (IEEE).

 

The directorship terms for Mr. Gibson, Mr. Leichtle and Dr. Sze willexpire at our annual meeting in calendar 2004. The directorship terms for Dr. Lu, Dr. Zhang and Mr. Kondamoori willexpire at our annual meeting in calendar 2005. The directorship terms for Mr.Gibian and Dr. Wang will expire at our annual meeting in calendar 2006.

 

There are no family relationships among our directors or executiveofficers.

 

*Audit Committee Financial Expert*

 

The members of the Audit Committee of the Board of Directors areDr. Andrew C. Wang, Thomas R. Gibian and Dr. Nien Dak Sze, each of whom isindependent within the meaning of the Nasdaq Stock Market, Inc. directorindependence standards. The Board of Directors has determined that each of Dr.Wang, Mr. Gibian, and Dr. Sze is an “*audit committee financialexpert*” as defined in the SEC rules.

 

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*Section 16(a) Beneficial Ownership Reporting Compliance*

 

The members of our Board of Directors, our executive officers andpersons who hold more than 10% of our outstanding common shares are subject tothe reporting requirements of Section 16(a) of the Securities Exchange Actof 1934, as amended, which require them to file reports with respect to theirownership of our common shares and their transactions in such common shares.Based upon (i) the copies of Section 16(a) reports that we havereceived from such persons for their 2004 fiscal year transactions in thecommon shares and their common shares holdings and (ii) the writtenrepresentations received from one or more of such persons that no annualForm 5 reports were required to be filed by them for the 2004 fiscal year,we believe that all reporting requirements under Section 16(a) for suchfiscal year were met in a timely manner by our executive officers, members of ourBoard of Directors and shareholders who hold more than 10% of our outstandingcommon shares, with the following exceptions:

 

Mr. Gibian did not timely file a Form 4 reporting stockgrants for Board service on 5 occasions. Mr. Gibson did not timelyfile a Form 4 reporting stock grants for Board service on 5occasions.  Mr. Kondamoori did nottimely file his Form 3 and did not timely file a Form 4 reportingstock grants for Board service on 1 occasion. Dr. Lu did not timely file aForm 4 reporting stock grants for Board service on 2 occasions. Dr. Szedid not timely file a Form 4 reporting stock grants for Board serviceon 4 occasions. Dr. Wang did not timely file a Form 4 reporting stockgrants for Board service on 5 occasions. Dr. Zhang did not timely file hisForm 3 and did not timely file a Form 4 reporting stock grants for Boardservice on 3 occasions. Mr. Hoagland did not timely file a Form 4reporting option grants on 2 occasions. Mr. Lindell did not timely file aForm 4 reporting option grants on 2 occasions. Mr. Stapleton did nottimely file a Form 4 reporting option grants on 2 occasions.Traditionally, we file these section 16(a) reports on behalf of our directorsand executive officers.

 

GBase Communications failed to file a Form 3 when it became thebeneficial owner of greater than 10% of our outstanding common shares.

 

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**Item11.  Executive Compensation**

 

*Compensation of Named Executive Officers*

 

The following table presents information about compensation paid by thecompany for the last three fiscal years for services by our chief executiveofficer and our four other most highly-compensated executive officerswhose total salary and bonus for the fiscal year exceeded $100,000 in fiscal2004.  These executives are referred toas the Named Executive Officers elsewhere in this Annual Report of Form 10-K/A.

 

**Summary Compensation Table**

 
| ** **                                         | ** ** | **Annual Compensation** | ** ** | ** **     | ** ** | **Long-Term Compensation Awards** | ** ** |
|----------------------------------------------------|------------|-------------------------|------------|----------------|------------|-----------------------------------|------------|
| **Name and  Principal Position**                   | ** ** | **Year**                | ** ** | **Salary ($)** | ** ** | **Bonus ($)**                     | ** ** | **Other Annual Compensation ($)** | ** ** | **Number of Securities Underlying Options (#)** | ** ** |
| Erwin F. Leichtle (1)                              |       | 2004                    |       | 272,885        |       | 150,000                           | (2)        | 21,660 | (3) | — |   |
| President and Chief Executive Officer              |       | 2003                    |       | N/A            |       | N/A                               |       | N/A |   | 250,000 |   |
|                                               |       | 2002                    |       | N/A            |       | N/A                               |       | N/A |   | N/A |   |
| Cal R. Hoagland                                    |       | 2004                    |       | 225,000        |       | 70,000                       | (2)        | — |   | 21,000 |   |
| Senior Vice President and Chief Financial  Officer |       | 2003                    |       | 170,742        |       | —                            |       | — |   | 25,000 |   |
|                                               |       | 2002                    |       | 159,280        |       | —                            |       | — |   | 40,000 |   |
| William T. Carlin (4)                         |       | 2004                    |       | 200,000        |       | —                            |       | 193,423 | (5) | — |   |
| Senior Vice President and Chief Operating  Officer |       | 2003                    |       | 186,154        |       | —                            |       | 118,781 | (5) | 25,000 |   |
|                                               |       | 2002                    |       | 188,462        |       | —                            |       | 198,202 | (5) | 40,000 |   |
| Lars Lindell (6)                                   |       | 2004                    |       | 108,143        |       | 69,577                            | (7)        | 32,800 | (8) | 45,000 |   |
| Vice President and General Manager, CDMA  Dvision  |       | 2003                    |       | N/A            |       | N/A                               |       | N/A |   | N/A |   |
|                                               |       | 2002                    |       | N/A            |       | N/A                               |       | N/A |   | N/A |   |
| Padraig Stapleton (9)                              |       | 2004                    |       | 164,623        |       | 30,000                            | (2)        | — |   | 26,000 |   |
| Vice President of Engineering                      |       | 2003                    |       | 148,229        |       | 20,000                            | (10)       | — |   | 25,000 |   |
|                                               |       | 2002                    |       | 141,900        |       | 23,000                            | (11)       | — |   | 3,000 |   |

 

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(1)                                  Mr. Liechtle was hired as President and ChiefExecutive Officer in July 2003.

 

(2)                                  Represents FY04 performance bonus earned byemployee.

 

(3)                                  Represents $9,660 paid to Mr. Liechtle forrelocation expenses and $12,000 for per diems while searching for new housing.

 

(4)                                  Mr. Carlin resigned as Senior VicePresident and Chief Operating Officer in October 2004.

 

(5)                                  Represents sales commissions earned byMr. Carlin.

 

(6)                                  Lars Lindell was hired as Vice President andGeneral Manager of the CDMA Division in December 2003.

 

(7)                                  Represents a $25,577 signing bonus and a$44,000 FY04 performance bonus earned by Mr. Lindell.

 

(8)                                  Represents $30,000 paid to Mr. Lindell forrelocation expenses and $2,800 paid to Mr. Lindell as an automobile allowance.

 

(9)                                  Mr. Stapleton was promoted to VicePresident of Engineering in August 2003.

 

(10)                            Represents key employee bonus given toMr. Stapleton.

 

(11)                            Represents key employee bonus and bonusrelating to patent filings given to Mr. Stapleton.

 

 

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* *

*Option Grants to Named Executive Officers During the Fiscal Year EndedJune 30, 2004*

 

The following table sets forth information with respect to stockoptions granted during the fiscal year ended June 30, 2004 to our NamedExecutive Officers. During the fiscal year ended June 30, 2004, options topurchase 487,350 common shares were granted to employees at a weighted-averageexercise price of $3.21.

 
| ** **        | ** ** | **Individual Grants**                               | ** ** | **Potential Realizable Value  at Assumed Annual Rates   of Share Price Appreciation  for Option Term** | ** ** |
|-------------------|------------|-----------------------------------------------------|------------|--------------------------------------------------------------------------------------------------------|------------|
| **Name**          | ** ** | **Number of Securities Underlying Options Granted** | ** ** | **Percentage of Total Options Granted to Employees in Fiscal Year**                                    | ** ** | **Exercise Price Per Share** | ** ** | **Fair Market Value at Time of Grant** | ** ** | **Expiration Date** | ** ** | **0%** | ** ** | **5%** | ** ** | **10%** | ** ** |
| Erwin F. Leichtle |       | —                                              |       | —                                                                                                 |       | — |   | — |   | — |   | — |   | — |   | — |   |
| Cal R. Hoagland   |       | 10,000                                              |       | 2.05                                                                                                   | %          | $2.20 |   | $2.20 |   | 10/02/13 |   | — |   | $13,836 |   | $35,062 |   |
| Cal R. Hoagland   |       | 11,000                                              |       | 2.26                                                                                                   | %          | $3.34 |   | $3.34 |   | 05/09/14 |   | — |   | $23,106 |   | $58,554 |   |
| William T. Carlin |       | —                                              |       | —                                                                                                 |       | — |   | — |   | — |   | — |   | — |   | — |   |
| Lars Lindell      |       | 40,000                                              |       | 8.21                                                                                                   | %          | $2.18 |   | $4.87 |   | 12/08/13 |   | $107,600 |   | $230,109 |   | $418,061 |   |
| Lars Lindell      |       | 5,000                                               |       | 1.03                                                                                                   | %          | $3.34 |   | $3.34 |   | 05/09/14 |   | — |   | $10,503 |   | $26,615 |   |
| Padraig Stapleton |       | 15,000                                              |       | 3.08                                                                                                   | %          | $2.53 |   | $2.53 |   | 08/07/13 |   | — |   | $23,867 |   | $60,483 |   |
| Padraig Stapleton |       | 11,000                                              |       | 2.26                                                                                                   | %          | $3.34 |   | $3.34 |   | 05/09/14 |   | — |   | $23,106 |   | $58,554 |   |

 

In accordance with the rules of the SEC, the above table shows thepotential realizable value over the term of the option (the period from thegrant date to the expiration date) based on assumed rates of share priceappreciation of 5% and 10%, compounded annually. These amounts do not representour estimate of future share prices. Actual gains, if any, on option exerciseswill depend on the future performance of our common shares.

 

The exercise price of Mr. Lindell’s option to purchase 40,000 shares isbelow the market price of the underlying security at the date of grant.  In accordance with the rules of the SEC, theabove column entitled “0%” shows the value of that option at the grant-datemarket price.

 

*Aggregated Option Exercises in Fiscal Year Ended June 30, 2004 and Year-EndOption Values for Named Executive Officers*

 
| ** **        | ** ** | ** **                          | ** ** | ** **              | ** ** | **Number of Securities  Underlying Unexercised  Options at FY-End (#)** | ** ** | **Value of Unexercised   In the Money Options   At FY-End ($)** | ** ** |
|-------------------|------------|-------------------------------------|------------|-------------------------|------------|-------------------------------------------------------------------------|------------|-----------------------------------------------------------------|------------|
| **Name**          | ** ** | **Shares Acquired on Exercise (#)** | ** ** | **Value  Realized ($)** | ** ** | **Exercisable/Unexercisable**                                           | ** ** | **Exercisable/Unexercisable (1)**                               | ** ** |
| Erwin F. Leichtle |       | —                              |       | —                  |       | 0                                                                       |       | 250,000                                                         |       | $0.00 |   | $762,500.00 |   |
| Cal R. Hoagland   |       | —                              |       | —                  |       | 52,628                                                                  |       | 33,370                                                          |       | $75,949.42 |   | $42,740.58 |   |
| William T. Carlin |       | —                              |       | —                  |       | 51,145                                                                  |       | 13,855                                                          |       | $70,750.00 |   | $0.00 |   |
| Padraig Stapleton |       | —                              |       | —                  |       | 17,379                                                                  |       | 23,621                                                          |       | $19,087.21 |   | $49,022.79 |   |
| Lars Lindell      |       | —                              |       | —                  |       | 104                                                                     |       | 44,896                                                          |       | $180.96 |   | $124,519.04 |   |

_________________

 

(1)                                  The amount set forth represents thedifference between the fair market value of the underlying common shares as ofJune 30, 2004 ($5.08) and the exercise price of the option, multiplied by thenumber of shares underlying the option.

 

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*Compensation of Directors*

 

All of our directors are eligible to receive grants of stock options.All non-employee directors receive compensation of $10,000 per year, plus$1,000 per meeting attended and $500 per telephone meeting for servicesprovided as a non-employee director. We also pay compensation to non-employeedirectors of $1,000 per meeting attended and $500 per telephone meeting forcommittee participation that is not in connection with a meeting of the Board.During calendar year 2003, each non-employee director received thiscompensation in common shares valued at the closing market price on the day theBoard or committee meeting or action took place. As payment for Board servicefrom July 1, 2003 through December 31, 2003, we granted 1,919 shares,2,938 shares, 116 shares, 1,348 shares, 2,344 shares, 2,639 shares, and 1,171shares to directors Gibian, Gibson, Kondamoori, Lu, Sze, Wang and Zhang,respectively, in connection with this compensation arrangement.  As payment for Board service from January 1,2004 through June 30, 2004, we have paid or will pay in the aggregate $12,000,$11,500, $8,000, $11,500, $11,000, $12,000 and $4,500 to directors Gibian,Gibson, Kondamoori, Lu, Sze, Wang and Zhang, respectively.

 

Non-employee directors are eligible to receive options under our 1999Option Plan. Each individual who first joins the Board of Directors as anon-employee director will receive at that time an option for 5,000 commonshares. The shares subject to each new non-employee director’s initial optionvests monthly over four years from the date of appointment to the Board. Inaddition, at each of our annual shareholders’ meetings, each non-employeedirector who continues to be a director after that meeting will automaticallybe granted an option for 1,000 common shares which will vest one-twelfth permonth following the date of grant. However, any non-employee director whoreceives an option for 5,000 shares under the 1999 Option Plan will firstbecome eligible to receive the annual option for 1,000 shares at the annualmeeting that occurs during the calendar year following the year in which hereceived the option for 5,000 shares. Directors are further eligible for stockoption grants at the discretion of the Compensation Committee. InDecember 2003, we granted an option to purchase 1,000 shares at anexercise price of $5.05 per share to each of directors Gibian, Gibson, Lu,Sze and Wang. In August 2003, we granted an option to purchase 5,000 shares atan exercise price of $2.53 per share to Dr. Zhang. In December 2003, wegranted an option to purchase 5,000 shares at an exercise price of $5.05 pershare to Mr. Kondamoori.

 

*Employment Agreements with Named Executive Officers*

 

In July 2003, we entered into an employment agreement with ErwinF. Leichtle, our President and Chief Executive Officer. The agreement providedfor an annual base salary of $275,000 and an annual bonus of $150,000 based onmeeting or exceeding mutually agreed-to-objectives with respect to revenues,margins, cash flow and profitability. The agreement also providesMr. Leichtle with a stock option to purchase 250,000 common shares subjectto time-based vesting over a four-year period. The agreement provides thatMr. Leichtle is an employee-at-will, which means that his employment maybe terminated at any time at our sole discretion. The agreement also providesthat if Mr. Leichtle is terminated without cause, we will owe himseverance to be paid over 12 months equal to 12-months of his then currentannual base salary, continued health benefits coverage over the same12 month period and continued vesting of his stock option for a period of12 months following his termination. In the event of a change-in-control ofInterwave and termination without cause, the vesting of Mr. Leichtle’sstock option will fully accelerate.

 

In June 2003, we entered into a new employment agreement with CalR. Hoagland, our Senior Vice President and Chief Financial Officer. Theagreement provided for an annual base salary of $225,000 and additionalcompensation of thirty percent of his annual base salary earned as a result ofa Management Bonus Offer Program or a Management Incentive Plan. The agreementprovides that Mr. Hoagland is an employee-at-will, which means that hisemployment may be terminated at any time at our sole discretion. The agreementalso provides that in the event of a termination without cause, we will owe himseverance to be paid over 9 months equal to 9 months of his then currentannual base salary, continued health benefits coverage over the same9 month period and continued vesting of all stock options for a period of12 months following his termination.

 

In September 2003, we entered into an employment agreement with LarsLindell, our Vice President 

 

9

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andGeneral Manager of the CDMA Division. The agreement provided for an annual basesalary of $190,000 and an annual bonus of $75,000 based on meeting or exceedingmutually agreed-to-objectives associated with market penetration, revenues, neworders, expenses and new product integration. The agreement also providesMr. Lindell with a stock option to purchase 40,000 common shares subjectto time-based vesting over a four-year period. The agreement also provides fora taxable monthly automobile allowance of $400 and reimbursement for allreasonable coach travel expenses associated with return trips once every othermonth for a period of one year to Amsterdam, Netherlands. The agreementprovides that Mr. Lindell is an employee-at-will, which means that hisemployment may be terminated at any time at our sole discretion. The agreementalso provides that if Mr. Lindell is terminated without cause, we will owehim severance to be paid over 6 months equal to 6 months of his thencurrent annual base salary, continued health benefits coverage over the same6 month period and continued vesting of his stock options for a period of12 months following his termination. In the event of a change-in-control ofInterwave and termination without cause, the vesting of Mr. Lindell’sstock options will fully accelerate.

 

In May 2004, the company entered into a new employment agreementwith Padraig Stapleton, our Vice President of Engineering. The agreementprovided for an annual base salary of $165,000. The agreement also providesthat Mr. Stapleton is an employee-at-will, which means that his employmentmay be terminated at any time at our sole discretion. The agreement also providesthat if Mr. Stapleton is terminated without cause, we will owe him severance tobe paid over 3 months equal to 3 months of his then current annual basesalary, continued health benefits coverage over the same 3 month periodand accelerated vesting of 3 months of unvested stock options.

 

In June 2003, we entered into a new employment agreement withWilliam T. Carlin, our Senior Vice President and Chief Operating Officer. Theagreement provided for an annual base salary of $200,000 and all commissionsearned and payable under our sales commissions plan and any other bonuscompensation earned under either a Management Bonus Offer program or ManagementIncentive Plan. The agreement provides that Mr. Carlin is anemployee-at-will, which means that his employment may be terminated at any timeat our sole discretion. The agreement also provides that in the event of atermination without cause, we will owe him severance to be paid over9 months equal to 9 months of his then current annual base salary, continuedhealth benefits coverage over the same 9 month period and continuedvesting of all stock options for a period of 12 months following histermination. Mr. Carlin resigned as Senior Vice President and Chief OperatingOfficer in October 2004.  We arecurrently negotiating a severance arrangement with Mr. Carlin, which would providehim with severance benefits substantially similar to those provided for in hisemployment agreement referenced above, and which would contain a standardrelease of claims against us.

 

*Compensation Committee Interlocks and Insider Participation*

 

None of the members of the Compensation Committee is currently, or hasbeen at any time since our formation, one of our officers or employees. Duringthe fiscal year ended June 30, 2004, none of our executive officers hasserved as a member of the board of directors or compensation committee of anyentity that has one or more officers serving as a member of our Board ofDirectors or Compensation Committee.

 

10

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**Item12.  Security Ownership of CertainBeneficial Owners and Management and Related Stockholder Matters**

 

                The followingtable shows the common shares beneficially owned as of October 19, 2004by: 

•              eachperson who is known by us to beneficially own 5% or more of our outstandingcommon shares; 

•              eachof our Named Executive Officers; 

•              eachof our directors; and 

•              allour executive officers and directors as a group. 

 

                Beneficialownership is determined in accordance with SEC rules. In computing the numberof shares beneficially owned by a person, we have included shares for which thenamed person has sole or shared power over voting or investment decisions. Thenumber of shares beneficially owned includes common shares which the namedperson has the right to acquire, through conversion, option or warrantexercise, or otherwise, within 60 days after October 19, 2004.Percentage of beneficial ownership is based on 9,388,302 shares outstanding asof October 19, 2004. Beneficial ownership calculations for 5% shareholdersare based solely on publicly-filed Schedule 13Ds or 13Gs, which 5%shareholders are required to file with the SEC, and which generally set forthownership interests as of October 19, 2004. Except as otherwise noted, theaddress of each person listed in the table is c/o Interwave CommunicationsInternational Ltd., 2495 Leghorn Street, Mountain View, CA 94043. 

 
| **Name  and Address of Beneficial Owner**                                                                       | ** **     | **Shares**

**Beneficially**

**Owned** | ** **     | **Percent of**

**Class** | ** **     |
|-----------------------------------------------------------------------------------------------------------------|----------------|-----------------------------------------|----------------|---------------------------|----------------|
| **5% Shareholders**                                                                                             |           |                                    |           |                      |           |
| Empire  Capital Partners, L.P. and affiliated entities (a)                                                 |           | 1,549,603                               |           | 16.5                      | %              |
| GBase  Communications (b)                                                                                  |           | 1,265,848                               |           | 13.5                      | %              |
|  

**Directors and Named Executive Officers**                                                              |  

  |  

                           |  

  |  

             |  

  |
| Thomas  Gibian (c)                                                                                         |           | 53,556                                  |           | *                         |           |
| William  E. Gibson (d)                                                                                     |           | 110,006                                 |           | 1.2                       | %              |
| Robert  Kondamoori (e)                                                                                     |           | 1,566                                   |           | *                         |           |
| Priscilla  M. Lu (f)                                                                                       |           | 409,653                                 |           | 4.3                       | %              |
| Nien  Dak Sze (g)                                                                                          |           | 15,613                                  |           | *                         |           |
| Andrew  C. Wang (h)                                                                                        |           | 19,506                                  |           | *                         |           |
| Ker  Zhang (i)                                                                                             |           | 4,838                                   |           | *                         |           |
| William  T. Carlin (j)                                                                                     |           | 37,929                                  |           | *                         |           |
| Cal  R. Hoagland (k)                                                                                       |           | 59,835                                  |           | *                         |           |
| Erwin  F. Leichtle (l)                                                                                     |           | 88,602                                  |           | *                         |           |
| Padraig  Stapleton (m)                                                                                     |           | 21,180                                  |           | *                         |           |
| Lars  Lindell (n)                                                                                          |           | 12,396                                  |           | *                         |           |
| All  directors and executive officers of the Company as a group (12 persons,  including the foregoing) (o) |           | 834,680                                 |           | 8.6                       | %              |

 

----

 

*              Less than one percent. 

(a)                                  Empire GP, L.L.C. ("Empire GP") isthe general partner of Empire Capital Partners, L.P. ("EmpireCapital"), which holds directly 1,256,300 of our common shares. EmpireCapital Management L.L.C. ("Empire CM") is the investment managerwith respect to 293,300 of our common shares collectively held by Empire CapitalPartners, Ltd., Empire Capital Partners II, Ltd., Charter OakPartners L.P. and Charter Oak II Partners L.P. (the "ManagedFunds") and is the management company to Empire Capital. Scott Fine andPeter J. Richards are 

11

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themanaging members of Empire GP and Empire CM. For purposes of Rule 13d-3under the Securities Exchange Act of 1934, as amended: Empire GP may be deemedto own beneficially 1,256,300 shares held by Empire Capital; Empire CM may bedeemed to own beneficially 293,300 shares held by the Managed Funds; andMessrs. Fine and Richards, each, may be deemed to own beneficially1,549,603 shares held by Empire Capital and the Managed Funds. The address forEmpire GP, Empire Capital, Empire CM and Messrs. Fine and Richards is 1 GorhamIsland, Westport, CT 06880. 

 

(b)                                 Shares currently held in trust by GBaseCommunications Liquidating Trust, c/o Kiomars Anvari and Jonathan Chang,Co-trustees, 420 N. Wiget Lane, Walnut Creek, California 94598 or940 Mission Court, Fremont, California 94539. 

 

(c)                                  Includes 9,979 shares issuable upon exerciseof options exercisable within 60 days of October 19, 2004. 

 

(d)                                 Includes 34,773 shares held by CrossroadsVenture Capital L.L.C., 588 shares held by a trust for Mr. Gibson'sgrandson, 29 shares held by a trust for Mr. Gibson's mother-in-law, 1,906shares held by a charitable remainder trust and 1,239 shares held by CrossroadsVenture Investors II L.P. Mr. Gibson disclaims beneficial ownershipof these shares, except to the extent of his pecuniary interest therein.Includes 56,375 shares issuable upon exercise of options exercisable within60 days of October 19, 2004. 

 

(e)                                  Includes 1,250 shares issuable upon exerciseof options exercisable within 60 days of October 19, 2004. 

 

(f)                                    Includes 200,000 shares held by BestVentures. Includes 8,000 shares held by Douglas Lu-Hill Irrevocable Trust;8,000 shares held by Olivia Lu-Hill Irrevocable Trust; and 8,000 shares held byFelicity Lu-Hill Irrevocable Trust. Dr. Lu disclaims beneficial ownershipof these shares, except to the extent of her pecuniary interest therein.Includes 41,586 shares issuable upon exercise of options exercisable within60 days of October 19, 2004. 

 

(g)                                 Includes 6,416 shares held by Sze FamilyInvestment Limited. Mr. Sze disclaims beneficial ownership of theseshares, except to the extent of his pecuniary interest therein. Includes 7,479shares issuable upon exercise of options exercisable within 60 days ofOctober 19, 2004. 

 

(h)                                 Includes 1,000 shares held by the Wang 1987Trust. Mr. Wang disclaims beneficial ownership of these shares, except tothe extent of his pecuniary interest therein. Includes 9,979 shares issuableupon exercise of options exercisable within 60 days of October 19,2004. 

 

(i)                                     Includes 1,667 shares issuable upon exerciseof options exercisable within 60 days of October 19, 2004. 

 

(j)                                     Includes 30,729 shares issuable upon exerciseof options exercisable within 60 days of October 19, 2004. 

 

(k)                                  Includes 59,835 shares issuable upon exerciseof options exercisable within 60 days of October 19, 2004. 

 

(l)                                     Includes 88,542 shares issuable upon exerciseof options exercisable within 60 days of October 19, 2004. 

 

(m)                               Includes 21,150 shares issuable upon exerciseof options exercisable within 60 days of October 19, 2004. 

 

(n)                                 Includes 12,396 shares issuable upon exerciseof options exercisable within 60 days of October 19, 2004. 

 

(o)                                 Includes 340,967 shares issuable uponexercise of options exercisable within 60 days of October 19, 2004. 

 

 

*Changes in Control*

 

On July 27, 2004, we entered into an amalgamation agreement withAlvarion Ltd., an Israeli company, and Alvarion Mobile Inc., a wholly ownedsubsidiary of Alvarion, under which we will be amalgamated with AlvarionMobile, and Alvarion Mobile will be the surviving company.  The parties subsequently amended theamalgamation agreement on August 25, 2004 and October 16, 2004.  For additional information on theamalgamation and the amended amalgamation agreement, please refer to ourpreliminary proxy statement filed with the Securities and Exchange Commissionon October 26, 2004.

 

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**Item 13.**** Certain Relationships and Related Transactions**

 

Since July 1, 2003, there has not been, nor is there currentlyproposed, any transaction or series of similar transactions to which we or anyof our subsidiaries was or is to be a party in which the amount involvedexceeded or will exceed $60,000 and in which any director or nominee, executiveofficer, holder of more than 5% of our common shares or any member of theimmediate family of any of the foregoing persons had or will have a direct orindirect material interest other than (i) compensation agreements andother arrangements, which are described above in “*EmploymentAgreements with Named Executive Officers*” and “*Compensationof Directors*,” (ii) the interests of our directors and executiveofficers in the proposed amalgamation which are described above in “*Changes in Control*” and (ii) the transactions describedbelow.

 

*Loans to Executive Officers.* We loaned Dr. Lu $132,000 in August 1999 so that she couldexercise her expiring option holdings. The options were exercised for 40,000 ofour common shares at an exercise price of $3.30 per share. In exchange for theloan, Dr. Lu entered into a promissory note with us in which she agreed torepay the loan on or before August 26, 2004. Dr. Lu timely paid allprincipal and accrued interest on the promissory note when due.

 

*Executive Search and Recruiting Fees to a Company Owned By the Spouseof a Former Director.*From July 2002 to August 2003, we paid $67,631 to Storm &Company, an executive search firm owned by Danelle Storm Rosati, for executivesearch and recruiting fees in connection with the search for a new ChiefExecutive Officer. Mario M. Rosati is the husband of Danelle Storm Rosati.Mr. Rosati joined our Board of Directors in May 2002 and resigned inAugust 2003.

 

*Amalgamation Agreement with Alvarion. *Pursuant tothe amended amalgamation between us, Alvarion and Alvarion Mobile, ourshareholders, including our directors and executive officers, are entitled toreceive $4.18 in cash, without interest, for each common share they own uponconsummation of the amalgamation.  Underthe amended amalgamation agreement, Mr. Leichtle, Mr. Lindell, Mr. Stapleton andMr. Hoagland will enter into new employment agreements with Alvarion when theamalgamation is completed.  Under Mr.Leichtle’s new agreement, Mr. Leichtle will receive a signing bonus in theamount of $164,500, an annual salary of $275,000, a potential retention bonusof $100,000 if Mr. Leichtle continues to be employed by Alvarion after 18months, an annual performance bonus of up to $150,000, an option to purchase100,000 Alvarion ordinary shares at their current fair market value and anoption to purchase 20,850 Alvarion ordinary shares at an exercise price equalto the par value of such shares.  UnderMr. Lindell’s new employment agreement, Mr. Lindell will receive an annualsalary of $190,000, a potential retention bonus of $40,000 if Mr. Lindellcontinues to be employed by Alvarion after 18 months, a performance bonus in anamount equal to up to 40% of his base salary for the 2005 fiscal year and anoption to purchase 25,000 Alvarion ordinary shares under Alvarion’s stockoption plan.  Under Mr. Stapleton’s newemployment agreement, Mr. Stapleton will receive an annual salary of $165,000,a potential retention bonus of $35,000 if Mr. Stapleton continues to beemployed by Alvarion after 18 months, a performance bonus in an amount equal toup to 20% of his base salary for the 2005 fiscal year and an option to purchase19,000 Alvarion ordinary shares under Alvarion’s stock option plan.  Under Mr. Hoagland’s transitional employmentarrangement, Mr. Hoagland will receive a salary at an annualized rate of $225,000through January 7, 2005, a potential retention bonus equal to 40% of hisprorated annual salary for the period beginning July 1, 2004 if he remainsemployed with Alvarion Mobile or Alvarion until January 7, 2005 and taxgross-up payments in the event his severance or other benefits under hisemployment agreement constitute “parachute payments” under the Internal RevenueCode and are subject to excise tax.  Foradditional information on the amalgamation and the amended amalgamationagreement, please refer to our preliminary proxy statement filed with theSecurities and Exchange Commission on October 26, 2004.

 

*Legal Counsel.*  Mr. Mario M. Rosati joined the Board ofDirectors in May 2002 and resigned in August 2003. Mr. Rosati is amember of Wilson Sonsini Goodrich & Rosati (“WSGR”). During the fiscalyear ended June 30, 2004, we employed WSGR as our legal counsel.

 

*Bonus to Executive Officers.*  For fiscal year 2004, Mr.Leichtle, Mr. Hoagland, Mr. Lindell and Mr. Stapleton earned performancebonuses of $150,000, $70,000, $44,000 and $30,000, respectively.

 

*Consulting Arrangement with Mr. Gibson*. During fiscal year 2004, we paid Mr. Gibson approximately $89,000 forconsulting services in connection with raising funds for the CDMA business unitand Mr. Gibson’s service on our 

 

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Executive Committee, whichoversaw our daily operations and the recruitment of a new President and ChiefExecutive Officer subsequent to Dr. Lu’s resignation as our ChiefExecutive Officer.

 

*Employment Agreement with Dr. Lu.*  InMay 2003, we entered into a new employment agreement with Dr. PriscillaM. Lu, our former Chief Executive Officer, who continued to be employed byus in other capacities until October 2003. The agreement provided for a salary of no less than $7,692.31 perbiweekly pay period and provided that in the event of a termination withoutcause, we would owe her severance to be paid over 12 months equal to 12months of her then current annual base salary, continued health benefitscoverage over the same 12 month period and continued vesting of all stockoptions for a period of 12 months following her termination. The agreementalso provided for an extension for a period of up to 9 months to exercise hervested options after termination. Dr. Lu’s employment with us was terminated inOctober 2003.  Pursuant to her employmentagreement’s salary and severance obligations, Dr. Lu earned $201,523 during thefiscal year ended June 30, 2004.

 

*Issuance of Common Shares to GBase Communications.*  FromSeptember 2002 through June 2004, Interwave issued a total of 1,265,847 commonshares in exchange for substantially all the assets of GBase Communications andin fulfillment of all the terms of the asset purchase agreement with GBaseCommunications. This amount included a total of 949,000 common shares asconsideration valued at $685,000 in fiscal 2004.

 

Our bye-laws provide that we shall indemnify our directors, officers,employees and other agents but not for acts of fraud and dishonesty on the partof these indemnified parties. In addition, our bye-laws provide that ourshareholders agree to waive any claims or right of actions the shareholders mayhave against any of our directors or executive officers on account of anyaction taken by the directors or executive officers in their capacity forInterwave. This waiver does not apply to claims arising under the U.S. federalsecurities laws. Our bye-laws also permit us to secure insurance on behalf ofany officer, director, employee or other agent for any liability arising out ofhis or her actions in such capacity, regardless of whether our bye-lawsexpressly permit indemnification.

 

We have entered into agreements indemnifying our directors andexecutive officers, in addition to the indemnification provided for in ourbye-laws. These agreements, among other things, indemnify our directors andexecutive officers for certain expenses including attorneys’ fees, judgments,fines and settlement amounts incurred by any director or executive officer inany action or proceeding, including any action by or in our right arising outof that person’s services as a director, officer, employee, agent or fiduciaryfor Interwave, any subsidiary of ours or any other company or enterprise towhich the person provides services at our request. The agreements do notprovide for indemnification in cases where:

 

•                                          the claim is brought by the indemnifiedparty;

 

•                                          the indemnified party has not acted in goodfaith;

 

•                                          the claim arises under section 16(b) ofthe Securities Exchange act; or

 

•                                          the indemnified party has engaged in acts,omissions or transactions for which the indemnified party is prohibited fromreceiving indemnification under the agreement or applicable law.

 

We believe that these provisions and agreements are necessary toattract and retain qualified persons as directors and executive officers. It isthe position of the SEC that indemnification for liabilities arising underfederal or state securities laws is against public policy and not enforceable.

 

 

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**Item 14.**** Principal Accountant Fees and Services**

 

For the fiscal years ended June 30, 2003 and June 30, 2004, KPMG LLP,our previous years’ independent auditor and principal accountant, billed theapproximate fees set forth below:

 
| ** **         | ** ** | **FY03 ($)** | ** ** | **FY04 ($)** | ** ** |
|--------------------|------------|--------------|------------|--------------|------------|
| Audit Fees         |       | 587,650      |       | 677,043      |       |
| Audit-Related Fees |       | —       |       | —       |       |
| Tax Fees           |       | 60,696       | (1)        | 71,647       | (1)        |
| All Other Fees     |       | —       |       | 25,429       | (2)        |

 

___________________

 

(1)  Represents fees for preparation of state,federal and foreign tax returns and extensions.

 

(2)  Represents fees for KMPG LLP’s services ascorporate secretary of our Hong Kong subsidiary and for its review ofgovernment grant submissions for our Ireland subsidiary.

 

KPMGLLP resigned as our auditor and principal accountant on March 25, 2004.  On April 20, 2004, we engaged Burr, Pilger& Mayer LLP to audit our financial statements as of and for the fiscal yearending June 30, 2004.  For the fiscal year ended June 30, 2004, BurrPilger & Mayer LLP billed the approximate fees set forth below:

 

 
| ** **         | ** ** | **FY04 ($)** | ** ** |
|--------------------|------------|--------------|------------|
| Audit Fees         |       | 216,365      |       |
| Audit-Related Fees |       | 9,070        | (1)        |
| Tax Fees           |       | —       |       |
| All Other Fees     |       | —       |       |

___________________

 

(1)  Represents fees for services in connectionwith acquisition-related matters.

 

TheAudit Committee has the sole authority to approve (i) the hiring and firing ofthe independent auditors; (ii) all audit engagement fees and terms; and (iii)all non-audit engagements, as may be permissible, with the independentauditors.  Generally, prior to the initiation of audit, audit-related,tax, and other services provided by our independent auditors, the AuditCommittee is presented with a proposal for such service and an estimate of thefees for pre-approval. The requests for pre-approvals are presented to theAudit Committee at the time of the committee’s regularly scheduled meetings, oron an as-needed basis. The Audit Committee has approved the engagement of ourindependent auditors and has pre-approved 100% of the estimated audit,audit-related, tax, and other services described above for fiscal 2003, and 92%of the estimated audit, audit-related, tax and other services for fiscal 2004.

 

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**EXHIBIT INDEX**

 
| **Exhibit Number** | ** ** | **Description of Exhibit**                                                                                                                                    |
|--------------------|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 23.2               |       | Consent of KPMG LLP                                                                                                                                           |
| 31.1               |       | Certification of Chief Executive Officer  pursuant to Rule 13a-14(a)/15d-14(a) under the Securities  Exchange Act of 1934, as amended                         |
| 31.2               |       | Certification of Chief Financial Officer  pursuant to Rule 13a-14(a)/15d-14(a) under the Securities  Exchange Act of 1934, as amended                         |
| 32.1               |       | Certification of Chief Executive Officer  Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section  906 of the Sarbanes-Oxley Act of 2002 |
| 32.2               |       | Certification of Chief Financial Officer  Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section  906 of the Sarbanes-Oxley Act of 2002 |

 

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**SIGNATURES**

 

Pursuant to the requirements of Section 13 or 15(d) of theSecurities Exchange Act of 1934, the Registrant has duly caused this AmendmentNo. 1 to Registrant’s Annual Report on Form 10-K/A to be signed on its behalfby the undersigned, thereunto, duly authorized, in the City of Mountain View,State of California, on October 28, 2004.

 
|   | INTERWAVE  COMMUNICATIONS    INTERNATIONAL, LTD. |
|--------|-------------------------------------------------------|
|   |                                                  |
|   | By:                                                   | /s/ ERWIN F. LEICHTLE |
|   |                                                  | Erwin F. Leichtle |
|   |                                                  | *President and Chief Executive Officer* |
|   |                                                  | *(Principal Executive Officer)* |

 

Pursuant to the requirements of the Securities andExchange Act of 1934, this Amendment No. 1 to Registrant’s Annual Report onForm 10-K/A has been signed by the following persons in the capacities and onthe date indicated:

 
| **Signature**         | ** ** | **Title**                                           | ** ** | **Date**          |
|-----------------------|------------|-----------------------------------------------------|------------|-------------------|
| ** **            | ** ** | ** **                                          | ** ** | ** **        |
| /s/ ERWIN F. LEICHTLE |       | President  and Chief Executive Officer and Director |       | October  28, 2004 |
| Erwin F. Leichtle     |       | (Principal  Executive Officer)                      |       |              |
|                  |       |                                                |       |              |
| /s/ CAL R. HOAGLAND   |       | Senior  Vice President and Chief Financial Officer  |       | October  28, 2004 |
| Cal R. Hoagland       |       | (Principal  Financial and Accounting Officer)       |       |              |
|                  |       |                                                |       |              |
| *                     |       | Chairman  of the Board of Directors                 |       | October  28, 2004 |
| William E. Gibson     |       |                                                |       |              |
|                  |       |                                                |       |              |
| *                     |       | Director                                            |       | October  28, 2004 |
| Thomas R. Gibian      |       |                                                |       |              |
|                  |       |                                                |       |              |
| *                     |       | Director                                            |       | October  28, 2004 |
| Bob Kondamoori        |       |                                                |       |              |
|                  |       |                                                |       |              |
| *                     |       | Director                                            |       | October  28, 2004 |
| Priscilla M. Lu       |       |                                                |       |              |
|                  |       |                                                |       |              |
| *                     |       | Director                                            |       | October  28, 2004 |
| Nien Dak Sze          |       |                                                |       |              |
|                  |       |                                                |       |              |
| *                     |       | Director                                            |       | October  28, 2004 |
| Andrew C. Wang        |       |                                                |       |              |
|                  |       |                                                |       |              |
|                  |       | Director                                            |       | October  __, 2004 |
| Ker Zhang             |       |                                                |       |              |

 
| * By:  | /s/ ERWIN F.  LEICHTLE |   |   |
|--------|------------------------|--------|--------|
|   | Erwin F. Leichtle      |   |
|   | Attorney in Fact       |   |

 

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