SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant X
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Filed by a Party other than the Registrant ____
Check the appropriate box:
Preliminary Proxy Statement Confidential, For Use of the
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X Definitive Proxy Statement Commission Only (as
----- permitted by Rule 14a-6(e)(2))
Definitive Additional Materials
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Soliciting Material Under Rule 14a-12
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PARKERVISION, INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
X No fee required.
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(5) Total fee paid:
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____ Fee paid previously with preliminary materials:
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____ Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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PARKERVISION, INC.
7915 BAYMEADOWS WAY, SUITE 400
JACKSONVILLE, FLORIDA 32256
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD SEPTEMBER 7, 2006
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NOTICE IS HEREBY GIVEN that the annual meeting of shareholders of
ParkerVision, Inc. will be held at the Marriott Boston Copley Place, 110
Huntington Avenue, Boston, Massachusetts on the 7th day of September, 2006 at
9:00 a.m. local time, for the following purposes:
1. To elect nine directors to hold office until the annual meeting of
shareholders in 2007 and until their respective successors have been
duly elected and qualified; and
2. To transact such other business as may properly come before the
meeting, and any adjournment(s) thereof.
The transfer books will not be closed for the annual meeting. Only
shareholders of record at the close of business on August 7, 2006 will be
entitled to notice of, and to vote at, the meeting and any adjournments thereof.
You are urged to read the attached proxy statement, which contains
information relevant to the actions to be taken at the meeting. In order to
assure the presence of a quorum, whether or not you expect to attend the meeting
in person, please sign and date the accompanying proxy card and mail it promptly
in the enclosed addressed, postage prepaid envelope. You may revoke your proxy
if you so desire at any time before it is voted.
By Order of the Board of Directors
/s/ Stacie Wilf
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Stacie Wilf
Secretary
Jacksonville, Florida
August 7, 2006
PARKERVISION, INC.
PROXY STATEMENT
GENERAL INFORMATION
This proxy statement and the enclosed form of proxy are being furnished in
connection with the solicitation of proxies by our board of directors to be used
at the annual meeting of shareholders to be held at 9:00 a.m. local time, on the
7th day of September, 2006 and any adjournments. The annual meeting will be held
at the Marriott Boston Copley Place, 110 Huntington Avenue, Boston,
Massachusetts. The matters to be considered at the meeting are set forth in the
attached Notice of Meeting.
Our executive offices are located at 7915 Baymeadows Way, Suite 400,
Jacksonville, Florida 32256. This proxy statement and the enclosed form of proxy
are first being sent to shareholders on or about August 7, 2006.
Record Date; Voting Securities
Our board of directors has fixed the close of business on August 4, 2006,
as the record date for determination of shareholders entitled to notice of, and
to vote at, the annual meeting. As of August 4, 2006, we had issued and
outstanding 23,372,227 shares of common stock, par value $.01 per share, our
only class of voting securities outstanding. Each of our shareholders is
entitled to one vote for each share of common stock registered in his or her
name on the record date.
Solicitation, Voting and Revocation of Proxies
Proxies in the form enclosed are solicited by and on behalf of our board
of directors. The persons named in the proxy have been designated as proxies by
our board of directors. Any proxy given pursuant to this solicitation and
received in time for the meeting will be voted as specified in the returned
proxy. If no instructions are given, proxies returned by shareholders will be
voted "FOR" the election of the nominees as our directors listed below and as
the proxies named in the proxy determine in their discretion with respect to any
other matters properly brought before the meeting. Any proxy may be revoked by
written notice received by our secretary at any time prior to the voting at the
meeting, by submitting a subsequent proxy or by attending the annual meeting and
voting in person. Attendance by a shareholder at the annual meeting does not
alone serve to revoke his or her proxy.
The presence, in person or by proxy, of a majority of the votes entitled
to be cast at the meeting will constitute a quorum at the meeting. A proxy
submitted by a shareholder may indicate that all or a portion of the shares
represented by his or her proxy are not being voted ("shareholder withholding")
with respect to a particular matter. Similarly, a broker may not be permitted to
vote stock ("broker non-vote") held in street name on a particular matter in the
absence of instructions from the beneficial owner of the stock. The shares
subject to a proxy which are not being voted on a particular matter because of
either shareholder withholding or broker non-vote will not be considered shares
present and entitled to vote on the matter. These shares, however, may be
considered present and entitled to vote on other matters and will count for
purposes of determining the presence of a quorum, unless the proxy indicates
that the shares are not being voted on any matter at the meeting, in which case
the shares will not be counted for purposes of determining the presence of a
quorum.
1
The directors will be elected by a plurality of the votes cast at the
meeting. "Plurality" means that the nominees who receive the highest number of
votes in their favor will be elected as our directors. Consequently, any shares
not voted "FOR" a particular nominee, because of either shareholder withholding
or broker non-vote, will not be counted in the nominee's favor.
All other matters that may be brought before the shareholders must be
approved by the affirmative vote of a majority of the votes cast at the meeting
unless the governing corporate law requires otherwise. Abstentions from voting
are counted as "votes cast" with respect to the proposal and, therefore, have
the same effect as a vote against the proposal. Shares deemed present at the
meeting but not entitled to vote because of either shareholder withholding or
broker non-vote are not deemed "votes cast" with respect to the proposal, and
therefore will have no effect on the vote.
Annual Report
Our Annual Report on Form 10-K for the fiscal year ended December 31,
2005, which contains our audited financial statements, is being mailed along
with this proxy statement.
We will provide to you exhibits to the Annual Report upon payment of a fee
of $.25 per page, plus $5.00 postage and handling charge, if requested in
writing to the Secretary, ParkerVision, Inc., 7915 Baymeadows Way, Suite 400,
Jacksonville, Florida 32256.
Security Ownership of Certain Beneficial Owners
The following table sets forth certain information as of July 17, 2006
with respect to the stock ownership of (i) those persons or groups who
beneficially own more than 5% of our common stock, (ii) each of our director
nominees, (iii) each executive officer whose compensation exceeded $100,000 in
2005, and (iv) all of our directors, director nominees and executive officers as
a group (based upon information furnished by those persons).
Amount and Nature of Percent of
Name of Beneficial Owner Beneficial Ownership Class(1)
------------------------ -------------------- --------
Jeffrey L. Parker(2) 3,271,848 (3)(4) 13.58%
J-Parker Family Limited Partnership(5) 2,325,984 (4) 9.95%
Todd Parker(2) 1,095,151 (6)(7) 4.66%
T-Parker Family Limited Partnership(5) 876,255 (7) 3.75%
Stacie Wilf(2) 987,823 (8)(9) 4.21%
S-Parker Wilf Family Limited Partnership(5) 863,811 (9) 3.70%
David F. Sorrells(2) 705,488 (10) 2.93%
William A. Hightower 207,500 (11) .88%
Robert G. Sterne 138,300 (12) .59%
William L. Sammons 179,750 (13) 0.76%
Nam P. Suh 120,000 (14) 0.51%
Papken S. der Torossian 135,000 (15) 0.57%
Cynthia Poehlman(2) 142,063 (16) 0.60%
John Metcalf 60,000 (17) 0.26%
Wellington Management Company, LLP(18) 3,424,950 (18) 14.65%
Heartland Value Fund((19)) 1,875,000 ((19)) 7.90%
All directors, director nominees and executive officers as a 7,042,923 (2(0)) 27.30%
group (11 persons)
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2
(1) Percentage includes all outstanding shares of common stock plus, for each
person or group, any shares of common stock that the person or the group has
the right to acquire within 60 days pursuant to options, warrants, conversion
privileges or other rights.
(2) The person's address is 7915 Baymeadows Way, Suite 400, Jacksonville,
Florida 32256.
(3) Includes 725,908 shares of common stock issuable upon currently
exercisable options, 2,325,984 shares held by J-Parker Family Limited
Partnership and 57,989 shares owned of record by Mr. Parker's three children
over which he disclaims ownership. Excludes 18,382 shares of common stock
issuable upon options that may become exercisable in the future.
(4) J-Parker Family Limited Partnership is the record owner of 2,325,984
shares of common stock. Mr. Jeffrey L. Parker has sole voting and dispositive
power over the shares of common stock owned by the J-Parker Family Limited
Partnership, as a result of which Mr. Jeffrey Parker is deemed to be the
beneficial owner of such shares.
(5) The entity's address is 409 S. 17th Street, Omaha, Nebraska 68102.
(6) Includes 132,063 shares of common stock issuable upon currently
exercisable options, 876,255 shares held by T-Parker Family Limited
Partnership and 10,100 shares owned of record by Mr. Parker's spouse and child
over which he disclaims ownership. Excludes 52,541 shares of common stock
issuable upon options that may become exercisable in the future.
(7) T-Parker Family Limited Partnership is the record owner of 876,255 shares
of common stock. Mr. Todd Parker has sole voting and dispositive power over
the shares of common stock owned by the T-Parker Family Limited Partnership,
as a result of which Mr. Todd Parker is deemed to be the beneficial owner of
such shares.
(8) Includes 67,500 shares of common stock issuable upon currently exercisable
options, 863,811 shares held by S-Parker Wilf Family Limited Partnership, and
50,590 shares owned of record by Ms. Wilf's spouse and two children over which
she disclaims ownership.
(9) S-Parker Wilf Family Limited Partnership is the owner of 863,811 shares of
common stock. Ms. Wilf has sole voting and dispositive power over the shares
of common stock owned by the S-Parker Wilf Family Limited Partnership, as a
result of which Ms. Wilf is deemed to be the beneficial owner of such shares.
(10) Represents 705,488 shares of common stock issuable upon currently
exercisable options. Does not include 93,898 shares of common stock issuable
upon options that may become exercisable in the future.
(11) Includes 182,500 shares of common stock issuable upon currently
exercisable options.
(12) Includes 137,500 shares of common stock issuable upon currently
exercisable options.
(13) Includes 160,000 shares of common stock issuable upon currently
exercisable options.
(14) Represents 120,000 shares of common stock issuable upon currently
exercisable options.
(15) Represents 135,000 shares of common stock issuable upon currently
exercisable options.
3
(16) Represents 142,063 shares of common stock issuable upon currently
exercisable options. Excludes 122,541 shares of common stock issuable upon
options that may become exercisable in the future.
(17) Represents 60,000 shares of common stock issuable upon currently
exercisable options.
(18) The business address of Wellington Management Company, LLP is 75 State
Street, Boston, Massachusetts 02109. Wellington Management, in its capacity as
investment adviser, may be deemed to have beneficial ownership of the shares
of common stock of the company that are owned of record by investment advisory
clients of Wellington Management. Of the shares of common stock of the company
held by its advisory clients, Wellington Management has shared voting
authority over 1,453,175 shares and non voting authority over 1,971,775
shares. The number of shares reported excludes shares underlying currently
exercisable warrants as they are not outstanding and there is no vote.
(19) The address is Heartland Value Fund is 789 North Water Street, Suite 500,
Milwaukee, Wisconsin, 53202. Heartland Advisors, Inc. is the investment
advisor for Heartland Value Fund. The number of shares reported includes
375,000 shares underlying a currently exercisable warrant. The foregoing
information was derived from the subscription and warrant agreements dated
February 3, 2006 between the company and Heartland Fund.
(20) Includes 2,568,022 shares of common stock issuable upon currently
exercisable options held by directors and officers and excludes 287,362 shares
of common stock issuable upon options that may vest in the future held by
directors and officers (see notes 3, 6, 8, 10, 11, 12, 13, 14, 15, 16 and 17,
above).
PROPOSAL 1: ELECTION OF DIRECTORS
The persons listed below have been designated by our board of directors as
nominees for election as directors to serve until the next annual meeting of
shareholders at which they will be elected or until their respective successors
have been elected and qualified. The by-laws of the company currently provide
that the board of directors may set the number of directors, and currently the
number of directors has been set at nine persons. At this annual meeting, nine
persons have been nominated. Unless otherwise specified in the form of proxy,
the proxies solicited by management will be voted "FOR" the election of these
candidates. In case any of these persons become unavailable for election to the
board of directors, an event which is not anticipated, the persons named as
proxies, or their substitutes, shall have full discretion and authority to vote
or refrain from voting for any other person in accordance with their judgment.
Director
Name Age Since Position
---- --- ----- --------
Jeffrey L. Parker 49 1989 Chairman of the Board and Chief Executive
Officer
Todd Parker 42 1989 Vice President and Director
David F. Sorrells 47 1997 Chief Technical Officer and Director
William A. Hightower 63 1999 Director
John Metcalf 55 2004 Director
William L. Sammons 85 1993 Director
Nam P. Suh 70 2003 Director
Papken S. der Torossian 67 2003 Director
Robert G. Sterne 54 - Director Nominee
4
Jeffrey L. Parker has been chairman of the board and our chief executive
officer since our inception in August 1989 and our president from April 1993 to
June 1998. From March 1983 to August 1989, Mr. Parker served as executive vice
president for Parker Electronics, Inc., a joint venture partner with Carrier
Corporation performing research development, manufacturing and sales and
marketing for the heating, ventilation and air conditioning industry.
Todd Parker has been a director since our inception and was a vice
president of ours from inception to June 1997 and from July 2002 to August 2006.
Mr. Parker has resigned his employment with us effective September 1, 2006 to
pursue other personal interests. Mr. Parker acted as a consultant to us from
June 1997 through November 1997 and from September 2001 to July 2002. On July
31, 2002, Mr. Parker was appointed president of the Video Business Unit of the
company until that division was sold in May 2004 when his title was changed to
Vice President for Corporate Development. Following the exit from retail
business activities in June 2005, Mr. Parker's title was changed to Vice
President of Product Operations. From January 1985 to August 1989, Mr. Parker
served as general manager of manufacturing for Parker Electronics.
David F. Sorrells has been our chief technical officer since September
1996 and has been a director since January 1997. From June 1990 to September
1996, Mr. Sorrells served as our engineering manager.
William A. Hightower has been a director since March 1999. From September
2003 to his retirement in November 2004, Mr. Hightower was the president of the
company. Mr. Hightower was the president and chief operating officer and a
director of Silicon Valley Group, Inc. ("SVGI"), from August 1997 until his
retirement in May 2001. SVGI is a publicly held company which designs and builds
semiconductor capital equipment tools for chip manufacturers. From January 1996
to August 1997, Mr. Hightower served as chairman and chief executive officer of
CADNET Corporation, a developer of network software solutions for the
architectural industry. From August 1989 to January 1996, Mr. Hightower was the
president and chief executive officer of Telematics International, Inc.
John Metcalf has been a director since June 2004. Since November 2002, Mr.
Metcalf has been a CFO Partner with Tatum LLC, an executive services and
consulting firm providing financial and information technology leadership with
over 500 CFO and CIO partners nationwide. Mr. Metcalf currently also is serving
as CFO for Siltronic Corporation, a silicon wafer manufacturing company. From
February 2001 to December 2001, Mr. Metcalf was vice president and chief
financial officer of Zight Corporation, a venture funded microdisplay company.
From January 1997 to December 2000, he was the vice president and chief
financial officer of WaferTech, a semiconductor foundry that was a joint venture
of TSMC, Altera, Analog Devices, and ISSI. Mr. Metcalf was the senior vice
president of finance, chief financial officer and corporate secretary of Siltec
Corporation, a silicon wafer manufacturer, from 1992 to 1997, and the vice
president finance and chief financial officer of Oki Semiconductor from 1987 to
1991. Prior to his employment by Oki Semiconductor, Mr. Metcalf was employed for
eleven years by Advanced Micro Devices in a number of finance managerial
positions.
William L. Sammons has been a director since October 1993. From 1981 until
his retirement in 1985, Mr. Sammons was president of the North American
Operations of Carrier Corporation.
Nam P. Suh has been a director since December 2003. Mr. Suh was
inaugurated as President of Korea Advanced Institute of Science and Technology
(KAIST) in July 2006. He is currently on a leave of absence from MIT where he
has been a member of the faculty since 1970. At MIT, Mr. Suh held many positions
including director of the MIT Laboratory for Manufacturing and Productivity,
head of the department of Mechanical Engineering (1991-2001) director of the MIT
Manufacturing Institute and director of the Park Center for Complex Systems. In
1984, Mr. Suh was appointed the Assistant Director for Engineering of the
National Science Foundation by President Ronald Reagan and confirmed by the U.S.
Senate. Mr. Suh is a widely published author of approximately 300 articles and
seven books on topics related to tribology, manufacturing, plastics and design.
Mr. Suh has approximately 50 United States patents and many foreign patents,
some of which relate to plastics, polymers and design. Mr. Suh serves on two
other public company boards including Therma-Wave, Inc. and Integrated Device
Technology, Inc.
5
Papken S. der Torossian has been a director since June 2003. Mr. der
Torossian was chief executive officer of SVGI from 1986 until 2001. Prior to his
joining SVGI, he was president and chief executive officer of ECS Microsystems,
a communications and PC company that was acquired by AMPEX Corporation where he
stayed on as a manager for a year. From 1976 to 1981 Mr. der Torossian was
president of the Santa Cruz Division of Plantronics where he also served as vice
president of the Telephone Products Group. Previous to that he spent four years
at Spectra-Physics and twelve years with Hewlett-Packard in a variety of
management positions. From 1997 to 2001, Mr. der Torossian served on the board
of the Silicon Valley Manufacturing Group. In March 2003, he joined the board of
directors as chairman of Therma-Wave, Inc., a company engaged in the manufacture
and sale of process control metrology systems used in manufacturing
semiconductors.
Robert G. Sterne is a director nominee for the annual meeting to which
this proxy statement relates. Since 1978, Mr. Sterne has been a partner of the
law firm of Sterne, Kessler, Goldstein & Fox PLLC, specializing in patent and
other intellectual property law. Mr. Sterne provides legal services to us as one
of our patent and intellectual property attorneys. Mr. Sterne served as a
director of ParkerVision from February 2000 to June 2003.
Messrs. Jeffrey and Todd Parker are brothers. Stacie Wilf, the secretary
of the company, is the sister of Messrs Jeffrey and Todd Parker.
Independence of Directors
The common stock of the company is listed on the Nasdaq Global Market
System, and the company follows the rules of Nasdaq in determining if a director
is independent. The board of directors also consults with the company's counsel
to ensure that the board of directors' determinations are consistent with those
rules and all relevant securities and other laws and regulations regarding the
independence of directors. Consistent with these considerations, the board of
directors affirmatively has determined that Messrs. William L. Sammons, Nam P.
Suh, Papken S. der Torossian and John Metcalf are the independent directors of
the company and Mr. Robert G. Sterne, the nominee-elect, will be an independent
director of the company. The other remaining directors are not considered
independent due to their current or recent employment by the company.
Board Meetings and Committees
During the fiscal year ended December 31, 2005, our board of directors met
ten times and acted by unanimous consent one time. All of our directors attended
each of the meetings except that Mr. Sorrells missed two meetings during the
last fiscal year. The directors are strongly encouraged to attend meetings of
shareholders. At the annual meeting of shareholders held in 2005, seven of our
directors attended the meeting. Members of our board of directors are elected
annually by our shareholders and may be removed as provided for in the 1989
Business Corporation Act of the State of Florida and our articles of
incorporation.
6
The board of directors has three committees, the audit committee, the
compensation committee and the nomination committee. Members of the individual
committees during the fiscal year ended December 31, 2005 and to the date of
this annual meeting are named below. Because Mr. Kashnow will not be a
continuing director, it is expected that Mr. Sterne, the nominee-elect, will be
appointed to one or more of these committees.
Audit Compensation Nominations
----- ------------ -----------
John Metcalf* Richard A. Kashnow* Nam P. Suh*
Richard A. Kashnow William L. Sammons John Metcalf
William L. Sammons Papken S. der Torossian Papken S. der Torossian
* Current chairperson.
Audit Committee
General. The audit committee was established in 1994. It is comprised of
independent directors. It is governed by a board-approved charter adopted in
2003, and amended in 2006, which is filed as an exhibit to this proxy statement
for the 2006 annual meeting. The charter, among other things, contains the
committee's membership requirements and responsibilities. The audit committee
oversees the company's accounting, financial reporting process, internal
controls and audits, and consults with management and the independent auditors
on, among other items, matters related to the annual audit, the published
financial statements and the accounting principles applied. As part of its
duties, the audit committee appoints, evaluates and retains the company's
independent auditors. It maintains direct responsibility for the compensation,
termination and oversight of the company's independent auditors and evaluates
the independent auditors' qualifications, performance and independence. The
audit committee also monitors compliance with the company's policies on ethical
business practices and reports on these items to the board of directors. The
audit committee has established policies and procedures for the pre-approval of
all services provided by the independent auditors. Further the audit committee
has established procedures for the receipt, retention and treatment, on a
confidential basis, of complaints received by the company, which are described
under "Shareholder Communications with the Board."
Financial Expert on Audit Committee. The board of directors made a
qualitative assessment of each of the audit committee members to determine their
level of financial knowledge and experience based on a number of factors and has
determined that each member is a financial expert within the meaning of all
applicable rules. This determination was made with reference to the rules of
Nasdaq and the SEC. The board of directors considered each of these persons'
ability to understand generally accepted accounting principles and financial
statements, their ability to assess the general application of generally
accepted accounting principles in connection with our financial statements,
including estimates, accruals and reserves, their experience in analyzing or
evaluating financial statements of similar breadth and complexity as our
financial statements, their understanding of internal controls and procedures
for financial reporting and their understanding of the audit committee
functions.
Meetings and Attendance. During the fiscal year ended December 31, 2005,
the audit committee met ten times and had no action by unanimous consent. The
audit committee has also met two times since January 1, 2006, in connection with
the annual report for the fiscal year ended December 31, 2005.
The firm of PricewaterhouseCoopers LLP acts as our principal accountants.
The following is a summary of fees paid to the principal accountants for
services rendered.
7
Audit Fees. For the years ended December 31, 2004 and December 31, 2005,
the aggregate fees billed for professional services rendered for the audit of
our annual financial statements, the review of our financial statements included
in our quarterly reports, and services provided in connection with regulatory
filings were approximately $560,300 and $617,827, respectively.
Audit Related Fees. For the years ended December 31, 2004 and December 31,
2005, there were no fees billed for professional services by our principal
accountants for assurance and related services.
Tax Fees. For the years ended December 31, 2004 and December 31, 2005,
there were no fees billed for professional services rendered by our principal
accountants for tax compliance, tax advice or tax planning.
All Other Fees. For each of the years ended December 31, 2004 and December
31, 2005, the aggregate fees billed for other professional services by our
principal accountants were approximately $1,500 for an annual license fee for
accounting research software.
All the services discussed above were approved by our audit committee. The
audit committee pre-approves the services to be provided by its principal
accountants, including the scope of the annual audit and non-audit services to
be performed by the principal accountants and the principal accountants' audit
and non-audit fees. The audit committee also reviews and recommends to the board
of directors whether or not to approve transactions between the company and an
officer or director outside the ordinary course.
Audit Committee Report
Pursuant to the charter of the audit committee originally adopted on April
25, 2003, the audit committee's responsibilities include, among other things:
o annually reviewing and reassessing the adequacy of the committee's
formal charter;
o reviewing and discussing our annual audited financial statements
with our management and our independent auditors and the adequacy of
our internal accounting controls;
o reviewing analyses prepared by management and independent auditors
concerning significant financial reporting issues and judgments made
in connection with the preparation of our financial statements;
o the engagement of the independent auditor;
o reviewing the independence of the independent auditors;
o reviewing our auditing and accounting principles and practices with
the independent auditors and reviewing major changes to our auditing
and accounting principles and practices as suggested by the
independent auditor or our management;
o the appointment of the independent auditor by the board of
directors, which firm is ultimately accountable to the audit
committee and the board of directors;
o approving professional services provided by the independent
auditors, including the range of audit and nonaudit fees; and
8
o reviewing all related party transactions on an ongoing basis for
potential conflict of interest situations.
The audit committee pre-approves the services to be provided by its
independent auditors. During the period January 1, 2005 through March 15, 2006,
the committee reviewed in advance the scope of the annual audit and non-audit
services to be performed by the independent auditors and the independent
auditors' audit and non-audit fees and approved them. The audit committee also
reviews and recommends to the board of directors whether or not to approve
transactions between the company and an officer or director outside the ordinary
course.
On many occasions during 2005 and thereafter, the audit committee met
privately at regularly scheduled meetings and held discussions with management,
the chief financial officer and our independent auditors. Management represented
to the committee that our consolidated financial statements were prepared in
accordance with generally accepted accounting principles, and the committee has
reviewed and discussed the consolidated financial statements with management and
the independent auditors. The audit committee also discussed and reviewed with
management and the independent auditors the internal controls and procedures of
the audit functions and the objectivity of the process of reporting on the
financial statements. The committee discussed with the independent auditors the
matters required to be discussed by Statement on Auditing Standards No. 61
(Communication with Audit Committees), various accounting issues relating to
presentation of certain things in our financial statements and compliance with
Section 10A of the Securities Exchange Act of 1934. Our independent auditors
also provided the audit committee with the written disclosures required by the
Independence Standards Board Standard No. 1 (Independence Discussions with Audit
Committees) and the committee discussed with the independent auditors and
management the auditors' independence. The committee discussed financial risk
exposures relating to the company with management and the processes in place to
monitor and control the exposure resulting therefrom, if any. Based upon the
committee's discussion with management and the independent auditors and the
committee's review of the representations of management and the report of the
independent auditors to the audit committee, the committee recommended that the
board of directors include our audited consolidated financial statements in the
Annual Report on Form 10-K for the year ended December 31, 2005. The committee
evaluated the performance of PricewaterhouseCoopers LLP and recommended to the
board their re-appointment as the independent auditors for the fiscal year
ending December 31, 2006.
John Metcalf
Richard A. Kashnow
William L. Sammons
9
Compensation Committee
General. The compensation committee, which is comprised of independent
directors, consults generally with management on matters concerning executive
compensation and benefit plans where board of directors or shareholder action is
contemplated with respect to the adoption of or amendments to such plans. It
makes recommendations to the board of directors on compensation generally,
executive officer salaries, bonus awards and equity compensation, special awards
and supplemental compensation and director compensation. The compensation
committee makes recommendations on organization, succession, the election of
officers, consultantships and similar matters where board of director approval
is required. It also administers the company's 2000 Performance Equity Plan and,
to the extent of outstanding awards, the 1993 Stock Option Plan.
In 2005, the compensation committee retained an external compensation
consultant to assist in a review of executive and board compensation programs.
The committee followed the recommendation of the independent consultants with
regard to base salaries, annual bonuses and long term equity incentives for the
executive management team.
Meetings and Attendance. During fiscal year ended December 31, 2005, the
compensation committee met seven times and had no actions by unanimous consent.
Compensation Committee Report
General Compensation Policy. We operate in a competitive and rapidly
changing high technology industry. The compensation committee believes that the
compensation program for our executive officers should be designed to attract,
motivate and retain talented executives responsible for the success of our
company. The compensation committee believes the compensation program should be
determined within a competitive framework and should be based on achievement of
overall financial results and individual contribution.
Compensation Components. The three major components that currently make up
the compensation of our executive officers are: base salary; annual incentive
awards in the form of a cash and/or equity bonus; and long-term equity-based
incentive awards historically in the form of stock option grants.
The compensation committee's determination of the compensation components
for executive officers is based on a conventional approach utilizing benchmark
data, industry practices, recommendations of independent compensation
consultants and, ultimately, the business judgment of the committee members. The
compensation committee has compared its executives' compensation levels to
independent compensation surveys and compensation packages for executives in
similarly sized technology companies and has found its compensation packages to
be comparable.
The base salary for each executive officer is determined at levels
considered appropriate for comparable positions at other companies. Annual
bonuses are determined based on benchmark data of comparable companies as well
as the achievement of financial performance targets, certain qualitative
milestones, and individual contribution. Long-term equity-based incentive
awards, historically in the form of stock option grants, are determined based on
a percentage of the Company's market capitalization with consideration of
factors such as the executive's position within us, individual performance,
potential for future responsibility and promotion, and the number of unvested
options held at the time of the new grant. The relative weight given to each of
these factors varies among individuals at the compensation committee's
discretion.
10
Executive Compensation Reviewed. Mr. Jeffrey Parker's annual base
compensation of $325,000 was reviewed by the committee in connection with
independent compensation consultants in 2005 and was found to be the median
range for comparable positions with benchmark companies. No adjustment was made
to Mr. Parker's base compensation in 2005. Mr. Parker's written employment
agreement expired as of October 1, 2005 and, at this time, the committee has not
approved a new employment agreement. After consideration of Mr. Parker's
involvement in raising additional capital for the company and implementing the
strategic shifts in the company's business focus in 2005, the compensation
committee awarded Mr. Parker an aggregate annual bonus valued at $130,000 for
fiscal year 2005. At Mr. Parker's request, this bonus was paid in $65,000 cash
and 10,908 fully vested share options valued at $64,903. In addition, the
committee awarded Mr. Parker a long-term equity incentive award of 75,000 fully
vested share options in August 2005.
Pursuant to Mr. David Sorrells' written employment agreement, the
committee increased Mr. Sorrells' salary by 5% to $262,500 in March 2005. After
consideration of Mr. Sorrells' technology accomplishments in 2005, the
compensation committee awarded a bonus valued at $71,400 for fiscal 2005. At Mr.
Sorrells' request, this bonus was paid in $35,684 cash and 5,988 fully vested
share options valued at $35,629. In addition, the committee awarded Mr. Sorrells
a long-term incentive award of 34,000 share options in August 2005. These
options vest equally over three years and expire in August 2012.
Mr. Todd Parker is not employed under a written employment agreement and
the committee did not recommend a salary increase for Mr. Parker for fiscal year
2005. In consideration of his contribution in product operations and corporate
development, the compensation committee awarded Mr. Parker a bonus valued at
approximately $54,400 for fiscal 2005. At Mr. Parker's request, this bonus was
paid in $27,188 cash and 4,563 fully vested share options valued at $27,150. In
addition, the committee awarded Mr. Parker a long-term incentive award of 25,000
share options in August 2005. These options vest equally over three years and
expire in August 2012. Effective September 1, 2006, Mr. Parker has resigned his
position with the company to pursue other personal interests. However, Mr.
Parker remains as a director of the company.
Cynthia Poehlman currently is employed as the chief financial officer of
the company. Ms. Poehlman is not employed under a written employment agreement.
The compensation committee reviewed Ms. Poehlman's compensation against
benchmark data provided by its independent compensation consultants and
increased her salary to $200,000 in August 2005. After consideration of her
contribution with regard to securities compliance and strategic business
direction, Ms. Poehlman was awarded a bonus valued at approximately $54,400 for
fiscal 2005. At Ms. Poehlman's request, this bonus was paid in $27,188 cash and
4,563 fully vested share options valued at $27,150. In addition, the committee
awarded Ms. Poehlman a long-term incentive award of 25,000 share options in
August 2005. These options vest equally over three years and expire in August
2012.
Notwithstanding anything to the contrary set forth in any of our previous
filings under the Securities Act of 1933 or the Securities Exchange Act of 1934,
that might incorporate our future filings under those statutes, the preceding
Compensation Committee Report on Executive Compensation and our Stock
Performance Graph (set forth herein below) will not be incorporated by reference
into any of those prior filings, nor will such report or graph be incorporated
by reference into any of our future filings under those statutes.
THE COMPENSATION COMMITTEE
Richard A. Kashnow
William L. Sammons
Papken S. der Torossian
11
Nominations Committee
General. The nominations committee, which consists of independent
directors, is responsible for overseeing the selection of persons to be
nominated as directors of the company.
The nominations committee considers persons identified by its members,
management, shareholders, potential investors, investment bankers and others.
The nominations committee may also use the services of search firms to assist in
identifying potential directors, in gathering information about the background
and experience of such persons and acting as an intermediary with such persons.
The nominations committee adopted a written charter in April 2004 which is
available on the company's website at www.parkervision.com. The nominations
committee does not have any formal criteria for nominees; however, it believes
that persons to be nominated should be actively engaged in business endeavors,
have an understanding of financial statements, corporate budgeting and capital
structure, be familiar with the requirements of a publicly traded company, be
familiar with industries relevant to the company's business endeavors, be
willing to devote significant time to the oversight duties of the board of
directors of a public company, and be able to promote a diversity of views based
on the person's education, experience and professional employments. The
nominations committee evaluates each individual in the context of the board as a
whole, with the objective of recommending a group of persons that can best
implement the company's business plan, perpetuate its business and represent
shareholder interests. The nominations committee may require certain skills or
attributes, for example financial or accounting experience, to meet specific
board needs that arise from time to time. The nominations committee does not
distinguish among nominees recommended by shareholders and other persons.
Shareholders and others wishing to suggest candidates to the nominations
committee for consideration as directors must submit written notice to the
corporate secretary, who will provide it to the nominations committee. The
company also has a method by which shareholders may nominate persons as
directors which is described in the section "Shareholder Proposals and
Nominations."
At the annual meeting to which this proxy relates, Mr. Richard Kashnow was
not re-nominated because he indicated that time constraints would prevent him
from being able to devote sufficient time to the responsibilities of being a
director of ParkerVision. The remaining eight current directors were nominated
to stand for re-election by the committee. The nominations committee also
nominated Mr. Robert G. Sterne as the nominee-elect to fill the position on the
board that Mr. Kashnow held. Mr. Sterne was identified by the nominating
committee as a potential candidate for the board, and the committee determined
that he would be an excellent addition to the board based on his experience with
intellectual property strategies, his familiarity with the Company and its
business and his previous service as a member of the board. Mr. Sterne will be
deemed an independent director. Three of the persons standing for re-election
are employed by the company in executive capacities.
Meetings and Attendance. During fiscal year ended December 31, 2005, the
nominations committee met two times had no actions by unanimous consent.
12
Code of Ethics and Shareholder Contact
The board of directors has adopted a code of ethics that is designed to
deter wrongdoing and to promote ethical conduct and full, fair, accurate, timely
and understandable reports that the company files or submits to the SEC and
others. A copy of the code of ethics may be found on the company's website at
www.parkervision.com.
Shareholders may contact members of the board of directors by writing to
them in care of the corporate secretary at the headquarters. The corporate
secretary will forward correspondence received to the directors from time to
time. This procedure was approved by the independent directors.
Compensation of Outside Directors
Currently, each non-employee director receives an annual retainer of
$25,000 paid in quarterly installments and an option grant of 10,000 shares upon
completion of each year of service as a director. In addition, non-employee
directors receive annual retainers, paid in quarterly installments, for
committee participation as follows:
-------------------------------- -------------------------------- ------------------------------
Audit Committee Compensation Committee Nominating Committee
-------------------------------- -------------------------------- ------------------------------
Chair Member Chair Member Chair Member
--------------- ---------------- -------------- ----------------- ------------- ----------------
$15,000 $7,500 $10,000 $5,000 $5,000 $2,500
--------------- ---------------- -------------- ----------------- ------------- ----------------
New non-employee directors receive an option grant of 40,000 shares upon
initial election to the board. These options vest at the end of the first year
of board service.
The foregoing director compensation program was implemented in June 2005
in connection with a board compensation review by a third party compensation
consultant. Prior to June 2005, the director compensation program included an
annual retainer of $20,000 payable in quarterly installments, a meeting fee of
$2,500 for each meeting attended in-person or $1,500 for each meeting attended
telephonically, and an option grant of 10,000 shares upon completion of each
year of service as a director. In addition, each committee chairman received an
annual retainer of $5,000 paid in quarterly installments.
All board members are reimbursed for reasonable expenses incurred in
attending meetings and reasonable expenses incurred in attending relevant
training seminars.
Executive Compensation
The following tables summarize the cash compensation paid by the company
to each of its executive officers (including our chief executive officer) who
were serving as executive officers at the end of the year ended December 31,
2005, for services rendered in all capacities to the company and its
subsidiaries during the years ended December 31, 2005, 2004 and 2003, options
granted to such executive officers during the year ended December 31, 2005, and
the value at the end of the fiscal year ended December 31, 2005 of all options
granted to the executive officers.
13
========================================================================================================================
SUMMARY COMPENSATION TABLE
------------------------------------------------------------------------------------------------------------------------
Name and Principal Fiscal Long Term
Position Year Annual Compensation Compensation
---------------------------------- Ended --------------------------------------------------- ------------------
12/31 Salary Bonus Other Annual
Compensation Options/SARs (#)
---------------------------------- -------------- ---------------- --------------- ------------------ ------------------
Jeffrey L. Parker 2005 $325,000 $ 65,000 85,908(1)
Chairman of the Board 2004 $305,288 $ 175,000 -- --
and Chief Executive 2003 $300,000 $ 25,000 --
Officer
---------------------------------- -------------- ---------------- --------------- ------------------ ------------------
Cynthia Poehlman 2005 $167,308 $ 27,188 29,563(2)
Chief Financial Officer 2004 $136,154 $ 75,000 150,000
2003 $120,000 $ 17,000 -- --
---------------------------------- -------------- ---------------- --------------- ------------------ ------------------
David Sorrells 2005 $262,500 $ 35,684 39,988(3)
Chief Technical Officer 2004 $259,856 $ 135,000 --
and Director 2003 $250,000 $ 125,000 -- 125,000
---------------------------------- -------------- ---------------- --------------- ------------------ ------------------
Todd Parker 2005 $200,000 $ 27,188 29,563(2)
Vice President, Product 2004 $200,000 $ 40,000 --
Operations and Director 2003 $182,115 $ 25,000 -- --
================================== ============== ================ =============== ================== ==================
(1) Includes 10,908 share options with an estimated fair value of $64,903
granted, at the election of Mr. Parker, in lieu of an additional cash
bonus for fiscal 2005.
(2) Includes 4,563 share options with an estimated fair value of $27,150
granted, at the election of the executive officer, in lieu of an
additional cash bonus for fiscal 2005.
(3) Includes 5,988 share options with an estimated fair value of $35,629
granted, at the election of Mr. Sorrells, in lieu of an additional cash
bonus for fiscal 2005.
We cannot determine, without unreasonable effort or expense, the specific
amount of certain personal benefits afforded to our employees, or the extent to
which benefits are personal rather than business. We have concluded that the
aggregate amounts of such personal benefits which cannot be specifically or
precisely ascertained do not in any event exceed, as to each individual named in
the preceding table, the lesser of $50,000 or 10% of the compensation reported
in the preceding table for such individual, or, in the case of a group, the
lesser of $50,000 for each individual in the group, or 10% of the compensation
reported in the preceding table for the group, and that such information set
forth in the preceding table is not rendered materially misleading by virtue of
the omission of the value of such personal benefits.
14
========================================================================================================================
OPTION/GRANTS IN LAST FISCAL YEAR
------------------------------------------------------------------------------------------------------------------------
Realizable Value
------------------------------ -------------- ---------------- ------------ --------------- ------------- --------------
% of Total
Options
Number of Granted to
Shares Under Employees in Exercise Expiration 5% 10%
Name Options Fiscal Year Price Date
------------------------------ -------------- ---------------- ------------ --------------- ------------- --------------
Jeffrey L. Parker 75,000(1) 15.2% $5.77 8/9/2012 $176,193 $410,612
10,908(1) 2.2% $8.91 12/20/2012 $ 39,571 $ 92,218
------------------------------ -------------- ---------------- ------------ --------------- ------------- --------------
Cynthia Poehlman 25,000(2) 5.1% $5.77 8/9/2012 $ 58,731 $ 136,871
4,563(1) 0.9% $8.91 12/20/2012 $ 16,553 $ 38,577
------------------------------ -------------- ---------------- ------------ --------------- ------------- --------------
David Sorrells 34,000(2) 6.9% $5.77 8/9/2012 $ 79,874 $ 186,144
5,988(1) 1.2% $8.91 12/20/2012 $ 21,723 $ 50,624
------------------------------ -------------- ---------------- ------------ --------------- ------------- --------------
Todd Parker 25,000(2) 5.1% $5.77 8/9/2012 $ 58,731 $ 136,871
4,563(1) 0.9% $8.91 12/20/2012 $ 16,553 $ 38,577
============================== ============== ================ ============ =============== ============= ==============
(1) Options are exercisable immediately upon grant.
(2) Options vest ratably over a three year period beginning August 9, 2006.
=========================================================================================================================
AGGREGATE FISCAL YEAR-END OPTION/SAR VALUES
AT DECEMBER 31, 2005
-------------------------------------------------------------------------------------------------------------------------
Number of Unexercised Value of Unexercised
Options/SARs at Fiscal Year In-the-Money Options/SARs at
End (#) Fiscal Year End
-------------- ------------- --------------------------------- -------------------------------
Shares
Acquired on Value Un- Un-
Name Exercise (#) Realized ($) Exercisable exercisable Exercisable exercisabl
-------------------------- -------------- ------------- ---------------- ---------------- ------------------ ------------
Jeffrey L. Parker __ __ 825,908 0 $ 251,823 $ 0
-------------------------- -------------- ------------- ---------------- ---------------- ------------------ ------------
Cynthia Poehlman __ __ 114,163 147,400 $ 102,867 $491,250
-------------------------- -------------- ------------- ---------------- ---------------- ------------------ ------------
David F. Sorrells __ __ 805,488 84,000 $ 8,638 $118,220
-------------------------- -------------- ------------- ---------------- ---------------- ------------------ ------------
Todd Parker __ __ 132,063 45,000 $ 867 $ 83,250
========================== ============== ============= ================ ================ ================== ============
15
Employment Agreements
In September 2000, we entered into an employment agreement with Jeffrey L.
Parker, our chairman of the board and chief executive officer, which expired on
September 30, 2005. Mr. Parker currently receives an annual base salary of
$325,000. Mr. Parker also will receive bonuses from time to time as may be
determined by the compensation committee, and he is eligible to participate in
the various benefit plans available to all executives of the company. Mr. Parker
was awarded a cash bonus of $65,000 in connection with his employment during
2005. Mr. Parker was awarded two stock options in 2000 in connection with his
execution of an employment agreement with us. The first option is for 350,000
shares of common stock, exercisable at a price per share of $41. This option
vested immediately and is exercisable until September 7, 2010, except as
provided in the option agreement. The second option is for 150,000 shares of
common stock, exercisable at $61.50 per share and vesting in five equal
installments of 30,000 shares on October 1 in each year from 2001 through 2005.
Once vested, the options remain exercisable until October 1, 2010, except as
provided in the option agreement.
In March 2002, we entered into an employment agreement with David F.
Sorrells, our chief technical officer and a director, which expires March 6,
2007. The agreement provides that Mr. Sorrells will receive an annual base
salary of not less than $250,000 for the first two-year period with annual
increases thereafter as determined by the compensation committee, but not less
than 5% of the prior year's base salary. Mr. Sorrells currently receives an
annual base salary of $262,500. Mr. Sorrells will also receive an annual bonus
as may be determined by the compensation committee based on the recommendation
of the chief executive officer. Mr. Sorrells was awarded a cash bonus of $35,684
in connection with his employment in 2005. Mr. Sorrells may also be granted
awards under the company's equity performance plans.
Stock Option Plans
In September 1993, the board of directors approved the 1993 stock plan
pursuant to which an aggregate of 500,000 shares of common stock were initially
reserved for issuance in connection with the benefits available for grant. The
1993 stock plan was amended on September 19, 1996, August 22, 1997 and November
16, 1998 by the board of directors to raise the number of shares of common stock
subject to the plan to 3,500,000. Each of these amendments was approved by our
shareholders. In September 2003, the 1993 stock plan was closed for future
grants of benefits, but remains outstanding until all the benefits granted there
under have either been exercised or terminated by their terms. As of December
31, 2005, there were a total of 1,757,151 shares of common stock that are
subject to outstanding grants under the 1993 stock plan.
In May 2000, the board of directors approved our 2000 performance equity
plan pursuant to which a total of 5,000,000 shares of common stock were reserved
for issuance in connection with the awards available for grant. The 2000 plan
was approved by our shareholders on July 13, 2000. The following types of awards
may be granted under the 2000 plan:
o incentive stock options;
o non-qualified stock options;
o stock appreciation rights;
o restricted stock awards;
o stock bonuses; or
o other forms of stock benefits.
16
Incentive stock options may be granted only to our employees. Other
benefits may be granted to our consultants, directors (whether or not they are
employees of ours), employees and officers. As of December 31, 2005, awards to
purchase a total of 3,282,020 shares of common stock are outstanding under the
2000 plan. As of December 31, 2005, we had 1,381,809 shares of common stock
available for grant for future awards under the 2000 plan.
Equity Compensation Plan Information
The following table gives the information about the common stock of the
company that may be issued upon the exercise of options, warrants and rights
under all of our existing equity compensation plans as of December 31, 2005,
including the 1993 Stock Plan, the 2000 Performance Equity Plan and other
miscellaneous plans.
----------------------------------------------------------------------------------------------------------------------------
Number of securities
remaining available for
Number of securities to Weighted-average future issuance under equity
be issued upon exercise exercise price of compensation plans (excluding
of outstanding options, outstanding options, securities
Plan Category warrants and rights warrants and rights reflected in column (a))
(a) (b) (c)
----------------------------------------------------------------------------------------------------------------------------
Equity compensation plans
approved by security holders 5,039,171 $21.51 1,381,809
----------------------------------------------------------------------------------------------------------------------------
Equity compensation plans not
approved by security holders 115,000 $23.25 0
----------------------------------------------------------------------------------------------------------------------------
Total 5,154,171 1,381,809
----------------------------------------------------------------------------------------------------------------------------
The equity compensation plans reported upon in the above table that were
not approved by security holders include:
o Options to purchase 25,000 shares granted to two directors in March
1999 at exercise prices of $23.25 per share. These options are
vested and expire in March 2009.
o Options to purchase 100,000 shares granted to an employee in March
1999 at an exercise price of $23.25. These options vested over five
years, ending on May 26, 2004, and expire in May 2009. As of
December 31, 2005, options to purchase 90,000 shares were subject to
this agreement and 10,000 options have been exercised.
17
Performance Graph
The following graph shows a five-year comparison of cumulative total
shareholder returns for our company, the Nasdaq U.S. Stock Market Index, the
Nasdaq Electronic Components Index and Nasdaq Telecommunications Index for the
five years ending December 31, 2005. The total shareholder returns assumes the
investment on December 31, 1999 of $100 in our common stock, the Nasdaq U.S.
Stock Market Index, the Nasdaq Electronic Components Index, and Nasdaq
Telecommunications Index at the beginning of the period, with immediate
reinvestment of all dividends.
[PERFORMANCE GRAPH]
Parkervision -NASNM
Cumulative Total Return
----------------------------------------------
12/00 12/01 12/02 12/03 12/04 12/05
PARKERVISION, INC. 100.00 57.34 22.28 26.73 24.30 24.85
NASDAQ STOCK MARKET (U.S.) 100.00 70.75 51.08 76.82 85.44 96.38
NASDAQ TELECOMMUNICATIONS 100.00 69.73 35.46 58.99 62.95 59.41
NASDAQ ELECTRONIC COMPONENTS 100.00 86.02 41.97 82.46 64.71 68.19
18
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
our officers, directors and persons who beneficially own more than ten percent
of a registered class of our equity securities to file reports of ownership and
changes in ownership with the SEC and the National Association of Securities
Dealers, Inc. Officers, directors and ten percent shareholders are charged by
SEC regulation to furnish us with copies of all Section 16(a) forms they file.
Based solely upon our review of the copies of such forms received by us, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, we believe that, during the fiscal year ended
December 31, 2005, all filing requirements applicable to our executive officers,
directors and ten percent shareholders were fulfilled.
Certain Relationships and Related Transactions
Prior to June 2006, we leased our executive offices pursuant to a lease
agreement dated March 1, 1992 with Jeffrey L. Parker and Barbara Parker. Barbara
Parker is Mr. Parker's mother. For each of the years ended December 31, 2005 and
2004, we incurred approximately $280,000 in rental expense under the lease. As
of June 1, 2006, the company entered into a lease agreement with an unrelated
third party and moved the company's executive offices. Mr. Jeffrey L. Parker and
Barbara Parker allowed early termination of the lease agreement without penalty.
Mr. Robert G. Sterne, director-nominee is a partner of Sterne, Kessler,
Goldstein & Fox, PLLC ("SKGF"), which serves as the Company's primary outside
patent counsel. The Company paid fees to SKGF of approximately $1.9 million for
the fiscal year ended December 31, 2005.
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP was our independent accountants for the fiscal
year ending December 31, 2005 and has been retained for 2006. A representative
of Pricewaterhouse Coopers LLP is expected to be present at the meeting with an
opportunity to make a statement if he desires to do so and is expected to be
available to respond to appropriate questions.
SOLICITATION OF PROXIES
We are soliciting the proxies of shareholders pursuant to this proxy
statement. We will bear the cost of this proxy solicitation. In addition to
solicitations of proxies by use of the mail, some of our officers or employees,
without additional remuneration, may solicit proxies personally or by telephone.
We may also request brokers, dealers, banks and their nominees to solicit
proxies from their clients where appropriate, and may reimburse them for
reasonable expenses related thereto.
SHAREHOLDER PROPOSALS AND NOMINATIONS
Shareholder Proposals and Nominations
Proposals of shareholders intended to be presented at the annual meeting
to be held in 2007 must be received at our offices by April 9, 2007 for
inclusion in the proxy materials relating to that meeting.
19
Our by-laws contain provisions in it intended to promote the efficient
functioning of our shareholder meetings. Some of the provisions describe our
right to determine the time, place and conduct of shareholder meetings and to
require advance notice by mail or delivery to us of shareholder proposals or
director nominations for shareholder meetings.
Under the by-laws, shareholders must provide us with at least 120 days
notice of business the shareholder proposes for consideration at the meeting and
persons the shareholder intends to nominate for election as directors at the
meeting. This notice must be received for the annual meeting in the year 2007 no
later than April 9, 2007. Shareholder proposals must include the exact language
of the proposal, a brief description of the matter and the reasons for the
proposal, the name and address of the shareholder making the proposal and
disclosure of that shareholder's number of shares of common stock owned, length
of ownership of the shares, representation that the shareholder will continue to
own the shares through the shareholder meeting, intention to appear in person or
proxy at the shareholder meeting and material interest, if any, in the matter
being proposed. Shareholder nominations for persons to be elected as directors
must include the name and address of the shareholder making the nomination, a
representation that the shareholder owns shares of common stock entitled to vote
at the shareholder meeting, a description of all arrangements between the
shareholder and each nominee and any other persons relating to the nomination,
the information about the nominees required by the Exchange Act of 1934 and a
consent to nomination of the person nominated.
Shareholder proposals or nominations should be addressed to Stacie Wilf,
Corporate Secretary, ParkerVision, Inc., 7915 Baymeadows Way, Suite 400,
Jacksonville, Florida 32256.
Discretionary Voting of Proxies on Other Matters
We do not now intend to bring before the annual meeting any matters other
than those specified in the Notice of the Annual Meeting, and we do not know of
any business which persons other than the board of directors intend to present
at the annual meeting. Should any business requiring a vote of the shareholders,
which is not specified in the notice, properly come before the annual meeting,
the persons named in the accompanying proxy intend to vote the shares
represented by them in accordance with their best judgment.
By Order of the Board of Directors
Stacie Wilf
Secretary
Jacksonville, Florida
August 7, 2006
20
Appendix A
AUDIT COMMITTEE CHARTER
OF
PARKERVISION, INC.
Purpose
The Audit Committee is appointed by the Board of Directors ("Board") of
ParkerVision, Inc. ("Company") to assist the Board in fulfilling its oversight
responsibility for monitoring (1) the integrity of the Company's accounting and
financial reporting and its systems of internal controls, (2) the performance,
qualifications and independence of the Company's independent auditors, and (3)
the Company's compliance with legal and regulatory requirements.
The Audit Committee shall prepare the report required by the rules of the
Securities and Exchange Commission ("Commission") to be included in the
Company's annual proxy statement.
Committee Membership
The Audit Committee shall consist of no fewer than three members, absent a
temporary vacancy. The members of the Audit Committee shall meet the
independence and experience requirements of The NASDAQ Stock Market, Inc.
("NASDAQ"), Section 10A(m)(3) of the Securities Exchange Act of 1934 ("Exchange
Act") and the rules and regulations of the Commission. Notwithstanding the
foregoing, membership of the Audit Committee will comply with the credential
requirements of applicable law, regulation and listing requirements, as
applicable to the Company from time to time.
All members of the Audit Committee shall be financially literate. At least one
member of the Committee shall be a financial expert, as defined by the
Commission rules pursuant to Section 401(h) of Regulation S-K.
The Board of Directors will assess and determine the qualifications of the Audit
Committee members. The members of the Audit Committee shall be appointed by the
Board, and may be replaced by the Board.
The Board of Directors shall select the Audit Committee Chair. If a Chair is not
designated or present, a Chair may be designated by a majority vote of the Audit
Committee members present.
Director's compensation is the only compensation which members of the Audit
Committee may receive from the Company.
Meetings and Procedures
The Audit Committee shall meet at least quarterly or more frequently as
circumstances dictate. The Audit Committee shall meet periodically with
management and the independent auditor in separate executive sessions. The Audit
Committee may request any officer or employee of the Company or the Company's
outside counsel or independent auditor to attend a meeting of the Audit
Committee or to meet with any members of, or consultants to, the Audit
Committee.
The Committee will keep written minutes of its meetings, which minutes will be
maintained with the books and records of the Company. The Committee will provide
the Board with regular reports of its activities.
21
The Audit Committee shall review and reassess the adequacy of this Charter
annually and recommend any proposed changes to the Board for approval. The Audit
Committee annually shall review the Audit Committee's own performance.
The Committee may form subcommittees for any purpose that the Committee deems
appropriate and may delegate to such subcommittees such power and authority as
the Committee deems appropriate. The Committee will not delegate to a
subcommittee any power or authority required by any law, regulation or listing
standards to be exercised by the Committee as a whole.
Committee Authority and Responsibilities
The primary responsibility of the Committee is to oversee the Company's
financial controls and reporting processes on behalf of the Board and report the
results of its activities to the Board. The Audit Committee recognizes that the
Company's management is responsible for the completeness and accuracy of the
Company's financial statements and disclosures and for maintaining effective
internal controls. The Committee also realizes that the independent auditor is
responsible for auditing the Company's financial statements. Accordingly,
management and the independent auditor have more knowledge and more detailed
information about the Company than do Audit Committee members and the Audit
Committee's primary responsibility is oversight. In carrying out its oversight
responsibilities, the Audit Committee will rely, in part, on the expertise of
management and the independent auditor. The Committee should take the
appropriate actions to set the overall corporate "tone" for quality financial
reporting, sound business risk practices, and ethical behavior.
The Audit Committee shall have the authority, to the extent it deems necessary
or appropriate, to retain independent legal, accounting or other advisors. The
Company shall provide for appropriate funding, as determined by the Audit
Committee, for payment of compensation to (i) the independent auditor for the
purpose of rendering or issuing an audit report and (ii) any advisors (including
counsel) employed by the Audit Committee.
The following shall be the principal recurring processes of the Committee in
carrying out its oversight responsibilities. The Committee may perform such
other duties and responsibilities as are consistent with its purpose and as the
Board or the Committee deems appropriate.
o Financial Reporting and Internal Controls
Review of Annual Audited Financial Statements. The Committee shall
review with management and the independent auditors the financial
statements to be included in the Company's Annual Report on Form
10-K (or the annual report to shareholders if distributed prior to
the filing of the Form 10-K). The Committee will review the (a)
quality, not just acceptability, of the Company's accounting
principles, including significant financial reporting issues and
judgments made in connection with the preparation of the financial
statements including alternative methods for presenting financial
information that have been discussed with management, the impact of
the use of the alternative methods, the methods preferred by
management and all material written communications between the
independent auditor and management; (b) the clarity and adequacy of
disclosures in the financial statements; and the Company's
disclosures under Management's Discussion and Analysis of Financial
Condition and Results of Operations, including the critical
accounting policies; and (c) major issues regarding the adequacy of
internal controls and steps taken in light of material deficiencies
(if any were noted).
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The Committee will discuss the results of the annual audit and any
difficulties the independent auditors encountered in the course of
their audit work, including any restrictions on the scope of the
auditors' activities or access to requested information, and any
significant disagreements with management. The Committee will also
discuss any other matters required to be communicated to the
Committee by the independent auditors under generally accepted
auditing standards, and the annual report on controls by the Chief
Executive Officer and the Chief Accounting Officer, as received by
the independent auditors. Based on these reviews and the discussions
with management and the independent auditors, the Committee will
make a recommendation to the Board whether the audited financial
statements should be included in the Company's Annual Report on Form
10-K.
Review of Interim Financial Statements; Earnings Releases. The
Committee shall review the interim financial statements, and the
Company's disclosures under Management's Discussion and Analysis of
Financial Condition and Results of Operations, with management and
the independent auditors prior to the filing of the Company's
Quarterly Report on Form 10-Q. The Committee shall also review any
Form 8-K that includes financial disclosures prior to its filing.
The Committee will discuss with management any proposed release of
earnings or guidance information, and financial information and
earnings guidance provided to analysts and rating agencies. The
Committee will discuss the results of the quarterly review and any
other matters required to be communicated to the Committee by the
independent auditors under generally accepted auditing standards.
Risk Assessment and Risk Management. The Audit Committee shall
review with management and independent auditors the Company's
policies for assessing and managing financial risk and the actual
risk exposure of the Company.
Internal Controls, Disclosure Controls and Procedures. The Audit
Committee shall review with management and the independent auditors
the Company's policies and procedures for maintaining the adequacy
and effectiveness of internal controls and disclosure controls
procedures. As part of this effort, the Committee will inquire of
management and the independent auditor about controls management has
implemented to minimize significant risks to the Company and the
effectiveness of these controls. The Committee will review the
quarterly assessments of such controls and procedures by the Chief
Executive Officer and Chief Accounting Officer.
The Committee will also review with management and the independent
auditor the effect on the Company's financial statements of
regulatory and accounting initiatives and off balance sheet
structures.
o Independent Auditors
The Audit Committee shall have the sole authority to appoint or
replace the independent auditor. The Audit Committee shall be
directly responsible for determining the compensation and oversight
of the work of the independent auditor (including resolution of
disagreements between management and the independent auditor
regarding financial reporting) for the purpose of preparing or
issuing an audit report or related work. The independent auditor
shall report directly to the Audit Committee.
The Committee shall review the auditors' independence from
management and the Company, including whether the auditors'
performance of permissible non-audit services is compatible with
their independence. This process will include, as least annually,
the Committee's review of the independent auditors' internal control
procedures, any material issues raised by the most recent internal
quality-control review, or peer review, of the independent auditors,
or by any inquiry or investigation by governmental or professional
authorities, within the preceding five years, respecting one or more
independent audits carried out by the independent auditors, and any
steps taken to deal with any such issues; and (to assess the
auditors' independence) all relationships between the independent
auditors and the Company.
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Annually, the Committee will review the qualifications and
performance of the Company's current independent auditors and select
the Company's independent auditors for the next year.
The Committee shall review with the independent auditors prior to
the audit the overall scope, planning and staffing of their audit.
The Audit Committee shall pre-approve all auditing services and
permitted non-audit services to be performed for the Company by its
independent auditor, including the fees and terms thereof (subject
to the de minimus exceptions for non-audit services described in
Section 10A(i)(1)(B) of the Exchange Act which are approved by the
Audit Committee prior to the completion of the audit).
The Committee shall verify the rotation of the lead (or
coordinating) audit partner having primary responsibility for the
audit and the audit partner responsible for reviewing the audit as
required by law. The Committee shall consider whether, in order to
assure continuing auditor independence, it is appropriate to adopt a
policy of rotating the independent auditing firm on a regular basis.
The Committee shall oversee the Company's hiring of employees or
former employees of the independent auditor who participated in any
capacity in the audit of the Company.
o Compliance with Legal and Regulatory Requirements
The Audit Committee shall obtain, from the independent auditor,
assurance that Section 10A(b) of the Exchange Act has not been
implicated. The Committee shall inquire and review with management
the Company's compliance with applicable laws and regulations and,
where applicable, recommend policies and procedures for future
compliance. The Committee shall review with management and the
independent auditor any correspondence with regulators or
governmental agencies and any published reports that raise material
issues regarding the Company's financial statements or accounting
policies. The Committee shall also review with the Company's General
Counsel legal matters that may have a material impact on the
financial statements or the Company's compliance policies. The
Committee shall review and approve all related-party transactions.
The Committee shall establish procedures for the receipt, retention
and treatment of complaints received by the Company regarding
accounting, internal accounting controls or reports which raise
material issues regarding the Company's financial statements or
accounting policies.
Limitation of Audit Committee's Role
While the Audit Committee has the responsibilities and powers set forth in this
Charter, it is not the duty of the Audit Committee to plan or conduct audits or
to determine that the Company's financial statements are fairly stated in
accordance with generally accepted accounting principles and applicable rules
and regulations. These are the responsibilities of management and the
independent auditor.
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