8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

(August 28, 2006/ December 28, 2005)

Integrated Silicon Solution, Inc.

(Exact name of registrant as specified in its charter)

Delaware	000-23084	77-0199971
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2231 Lawson Lane

Santa Clara, California

95054

(Address of Principal Executive Offices)

(Zip Code)

Registrant’s telephone number, including area code: (408) 969-6600

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

(1) B. Riley Letter Agreement. On August 28, 2006, Integrated Silicon Solution, Inc., a Delaware corporation (“ISSI”), entered into a letter agreement (the “Letter Agreement”) with Riley Investment Management, LLC, SACC Partners, LP, Bryant R. Riley, R. Riley & Co. Retirement Trust and B. Riley & Co., Inc. (the “Riley Parties”). Pursuant to the Letter Agreement, ISSI has agreed, among other things, to expand the size of its Board of Directors from seven members to nine members and elect each of Bryant Riley and Melvin Keating to fill the vacancies created by such increase no later than September 15, 2006. Additionally, ISSI has agreed to deliver to the Riley Parties on or before November 30, 2006 written commitments from three of ISSI’s current directors (other than Jimmy S. Lee and Kong Yeu Han) not to seek or accept re-nomination for election to the Board of Directors at ISSI’s 2007 annual meeting of stockholders. The Letter Agreement further anticipates that ISSI’s nominating committee will nominate for election at ISSI’s 2007 annual meeting of stockholders the six remaining directors and one additional independent director mutually agreeable to the Riley Parties and ISSI’s board of directors and its nominating committee and that the size of the Board will be reduced to seven members at such time. Until after its 2008 annual meeting of stockholders, ISSI has also agreed not to (i) adopt any form of shareholder rights plan or similar device, (ii) submit to stockholders a proposal to establish a staggered board of directors or (iii) adopt certain amendments to its by-laws.

In the Letter Agreement, the Riley Parties have agreed, among other things, to cancel and withdrawal their demand for a special meeting of ISSI stockholders and related matters as set forth in their letter dated August 15, 2006. So long as ISSI is not in breach of the Letter Agreement, until the time that proxies for the ISSI 2008 annual meeting of stockholders are first solicited, the Riley Parties have agreed not to initiate, or suggest to any third party that they should initiate, any proposal to accomplish any of the items described in Item 1006 ( c) parts 1, 2, 4 or 5 of Regulation MA under the Securities Exchange Act of 1934, as amended, nor will the Riley Parties initiate or participate, in opposition to the management’s nominees, in any proxy contest involving the election or removal of directors for ISSI. Each Riley Party is a stockholder of ISSI or is affiliated with one of such stockholders, and in the aggregate the Riley Parties own in excess of 10% of the outstanding shares of ISSI.

The foregoing description of the Letter Agreement is qualified in its entirety by reference to the text of such agreement which is attached hereto as Exhibit 10.1 and incorporated herein by reference.

(2) Gary Fischer Letter Agreement. Effective November 28, 2005, Gary L. Fischer resigned as ISSI’s President, Chief Financial Officer and Secretary. On December 28, 2005, ISSI and Mr. Fischer entered into a letter agreement regarding his transition from the company. Under this agreement, Mr. Fischer agreed to work as ISSI’s acting chief financial officer until a permanent chief financial officer was hired. He also agreed to remain an employee to assist ISSI (including the new chief financial officer) on various other matters. In consideration for such services, Mr. Fischer will be paid a total of $90,000 and his previously granted stock options would continue to vest so long as he remained an employee. Mr. Fischer has served as a member of ISSI’s Board of Directors since April 2001. The foregoing description of such agreement is qualified in its entirety by reference to the text of such agreement which is attached hereto as Exhibit 10.2 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

10.1	Letter Agreement, dated August 28, 2006, among Integrated Silicon Solution, Inc., Riley Investment Management, LLC, SACC Partners, LP, Bryant R. Riley, R. Riley & Co. Retirement Trust and B. Riley & Co., Inc.
10.2	Letter Agreement, dated December 28, 2005, between Integrated Silicon Solution, Inc. and Gary L. Fischer.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	INTEGRATED SILICON SOLUTION, INC.
Date: August 30, 2006	/s/ SCOTT D. HOWARTH
	Scott D. Howarth
	Vice President and Chief Financial Officer

INDEX TO EXHIBITS

10.1	Letter Agreement, dated August 28, 2006, among Integrated Silicon Solution, Inc., Riley Investment Management, LLC, SACC Partners, LP, Bryant R. Riley, R. Riley & Co. Retirement Trust and B. Riley & Co., Inc.
10.2	Letter Agreement, dated December 28, 2005, between Integrated Silicon Solution, Inc. and Gary L. Fischer.

EX-10.1

Exhibit 10.1

August 28, 2006

Bryant R. Riley

Riley Investment Management LLC

11000 Santa Monica Boulevard

Suite 810

Los Angeles, CA 90025

Re: Integrated Silicon Solution, Inc.

Dear Bryant:

This letter is in response to your letter dated August 15, 2006 addressed to me as Chairman of Integrated Silicon Solution, Inc. (“ISSI”) and is intended to reflect our recent discussions. To confirm your agreement to the matters herein, please sign and return this letter to me.

1) At an ISSI Board meeting to be held no later than September 15, 2006, the size of the ISSI Board will be expanded from seven (7) members to nine (9) members and Bryant Riley and Melvin Keating will be appointed to the newly created seats on the Board. One of such new directors initially will be named to the Nominating Committee of the Board.

2) ISSI will hold its next annual meeting of stockholders no later than February 15, 2007. In connection with the annual meeting, it is expected that three (3) current ISSI directors will not seek re-election to the Board and it is agreed that the size of the ISSI Board will be changed back to seven (7) members. It is also expected that the ISSI Nominating Committee will nominate for election at the 2007 annual meeting the six (6) then serving and continuing directors (including you and Melvin Keating) and another independent director mutually agreeable to you and the ISSI Board and Nominating Committee. On or before November 30, 2006, ISSI will deliver to you the written commitment of three (3) directors, none of whom shall be Jimmy S. Lee or Kong Yeu Han, not to seek or accept re-nomination to the Board, and confirmation that the Nominating Committee has agreed to include Bryant Riley, Melvin Keating and the director mutually agreed upon as provided in the foregoing sentence on its slate of nominees for the 2007 annual meeting.

3) By your execution of this letter, you hereby cancel and withdrawal your demand for a special meeting of ISSI stockholders and related matters as set forth in your letter dated August 15, 2006. ISSI confirms it accepts the demand as valid and in proper form. ISSI acknowledges you may submit a new demand in the same form except for the date of the special meeting, if ISSI has not fulfilled its commitments to you in paragraphs 1 and 2 above. In such event, ISSI will hold the requested meeting no later than forty-five (45) days from the date of your request and agrees you may give the notice of such meeting if ISSI has not done so within twenty (20)

August 28, 2006

Page 2

days of your request. In addition, ISSI agrees that if it does not fulfill its commitments to you in this letter, in addition to any other remedies available to you, you may submit a slate of nominees or submit stockholder proposals for the ISSI 2007 annual meeting without giving notice 120 days in advance, provided you give such notice within a reasonable time of ISSI’s failure to fulfill its commitments to you and prior to the time ISSI has mailed its proxy materials for such annual meeting and have given ISSI written notice of the matter to which you believe ISSI did not fulfill its commitment.

4.) ISSI agrees not to adopt any form of shareholder rights plan or other device intended to restrict or impede acquisitions of blocks of stock, or proposals which could lead to a change of control (sometimes colloquially referred to as a “poison pill”), to submit to stockholders a proposal to establish a staggered board of directors or to adopt any amendment to its by-laws reducing or limiting the rights of stockholders to call a special meeting of stockholders, in each case without your written consent until after the 2008 annual meeting of stockholders of ISSI. . Nothing in this Paragraph 4 shall prohibit the submission of proposals for such changes to stockholders at the valid request of stockholders not affiliated with, or acting in concert with, any present member of the ISSI board of directors, provided the Board does not recommend the adoption of the proposal.

5.) Unless ISSI fails to fulfill its commitments to you in this letter, until the time that proxies for the ISSI 2008 annual meeting of stockholders are first solicited, you will not initiate, or suggest to any third party that they should initiate, any proposal to accomplish any of the items described in Item 1006 ( c) parts 1, 2, 4 or 5 of Regulation MA under the Securities Exchange Act of 1934, as amended, nor will you initiate or participate, in opposition to the management’s nominees, in any proxy contest involving the election or removal of directors for ISSI. At the time of your election to ISSI’s Board you agree to execute a mutually agreeable agreement to this effect.

You and ISSI agree that either party may make the contents of this letter public in order to comply with applicable federal and state securities laws.

Regards,

Integrated Silicon Solution, Inc.

/s/ Jimmy S.M. Lee,

Chairman and CEO

August 28, 2006

Page 3

Accepted and agreed to:

Riley Investment Management, LLC
By:	/s/ Bryant R. Riley
	Bryant R. Riley, Managing Member
SACC Partners, LP
By:	Riley Investment Management, LLC, its
	General Partner
By:	/s/ Bryant R. Riley
	Bryant R. Riley, Managing Member
/s/ Bryant R. Riley
Bryant R. Riley
B. Riley & Co. Retirement Trust
By:	/s/ Bryant R. Riley
	Bryant R. Riley, Trustee
B. Riley & Co., Inc.
By:	/s/ Bryant R. Riley
	Bryant R. Riley, President

Dated: August 28, 2006

EX-10.2

Exhibit 10.2

December 28, 2005

Re: Summary of Gary Fischer’s arrangement as he changes his role

1. Gary has resigned as President and CFO but will be acting CFO until his replacement is appointed. Jimmy Lee and the ISSI board have determined that it is in ISSI’s interest to continue to have Gary involved at ISSI and Gary agrees.

2. Gary will remain on the ISSI board, serve as acting CFO, sign the 10-K and maybe future 10-Qs (until the new CFO is appointed), recruit and train the new CFO, work with HMC, work with EY, do IR, consult with and support various people at ISSI such as Jimmy, Paula, Jessica, Ruth, Michael, Sanjiv and others.

3. Even though Gary is going to a startup, he will retain his email and voicemail at ISSI. He will keep his current office and when the new CFO is appointed he will retain a different office, probably Tom Dozcy’s or share with Tom Dozcy. Gary will retain use of his laptop.

4. The board has approved that Gary will be paid in calendar 2006 the sum of $90,000. Currently it is contemplated that this will be $30K in Q1, $25K in Q2, $20K in Q3 and $15K in Q4. However if it later appears unlikely that ISSI may pay him additional funds in 2007 then some of these amounts may eventually be shifted and applied to calendar years 2007 and 2008, along with any unpaid vacation. Gary will remain on the payroll through December 31, 2008 and will continue to vest his stock until December 31, 2008. He will actively support ISSI and work for ISSI as needed during this entire period. His status as a board member will be reviewed at the will of the board.

5. As of January 1, 2006 Gary will not accrue vacation, be eligible for sick pay, for 401K contributions (but he can keep his 401K account with ISSI), the flex plan or for other such benefits.

6. Gary will retain use of his ISSI leased vehicle through December 2006 and at that time he and Jimmy will determine if he can keep it beyond that date.

7. Gary will receive the standard, annual stock grant issued to outside board members in February 2006.

Reviewed and agreed:

/s/ Jimmy Lee	/s/ Gary Fischer
Jimmy Lee	Gary Fischer