<PAGE>
================================================================================
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
POWERWAVE TECHNOLOGIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
N/A
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(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):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] 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:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
[LOGO OF POWERWAVE TECHNOLOGIES APPEARS HERE]
POWERWAVE TECHNOLOGIES, INC.
2026 McGaw Avenue
Irvine, California 92614
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held September 20, 1999
To Our Shareholders:
The Annual Meeting of Shareholders of Powerwave Technologies, Inc. (the
"Company") will be held at the Orange County Airport Hilton, 18800 MacArthur
Boulevard, Irvine, California, 92612 on Monday, September 20, 1999 at 10:00
a.m., local time, for the following purposes:
1. To elect seven directors to hold office until the next Annual
Meeting of Shareholders or until their successors are duly elected
and qualified;
2. To approve an amendment to the Company's 1996 Stock Incentive Plan
to increase the number of shares of Common Stock issuable
thereunder from 3,000,000 to 5,000,000;
3. To ratify the appointment of Deloitte & Touche LLP as independent
auditors;
4. The transaction of such other business as may properly come before
the meeting or any adjournment or postponement thereof.
Only shareholders of record at the close of business on August 11, 1999,
(the "Record Date") are entitled to notice of and to vote at the Annual Meeting.
A list of shareholders as of the Record Date will be available during normal
business hours for examination by any shareholder for any purpose germane to the
Annual Meeting for a period of ten days prior to September 20, 1999, at the
offices of the Company, 2026 McGaw Avenue, Irvine, California 92614.
All shareholders are urged to attend the meeting in person or by proxy.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING IN PERSON, PLEASE SIGN AND
PROMPTLY RETURN THE ACCOMPANYING PROXY CARD IN THE ENCLOSED POSTPAID ENVELOPE.
The proxy is revocable and will not affect your right to vote in person in the
event you attend the Annual Meeting. You may revoke your proxy at any time
before it is voted. If you receive more than one proxy card because your shares
are registered in different names or at different addresses, please sign and
return each proxy card so your shares will be represented at the Annual Meeting.
In addition, if you plan to attend the Annual Meeting in person, please check
the appropriate box so that we can ensure we have proper accommodations.
By Order of the Board of Directors
Kevin T. Michaels
Vice President, Finance
Chief Financial Officer
and Secretary
Irvine, California
August 13, 1999
<PAGE>
POWERWAVE TECHNOLOGIES, INC.
_______________________________
PROXY STATEMENT
_______________________________
ANNUAL MEETING OF SHAREHOLDERS
To Be Held September 20, 1999
General Information
This proxy statement contains information related to the solicitation of
proxies by and on behalf of the Board of Directors of Powerwave Technologies,
Inc. (the "Company") for use in connection with the Annual Meeting of
Shareholders to be held on Monday, September 20, 1999, beginning at 10:00 a.m.,
local time, at the Orange County Airport Hilton, 18800 MacArthur Boulevard,
Irvine, California 92612 and any and all adjournments or postponements thereof.
The persons named as proxies were designated by the Board of Directors and
are officers and/or directors of the Company. Any proxy may be revoked or
superseded by executing a later proxy or by giving notice of revocation in
writing to the Secretary prior to, or at, the Annual Meeting, or by the person
who executed the proxy attending the Annual Meeting and voting in person. All
proxies that are properly completed, signed and returned to the Company prior to
the meeting, and not revoked, will be voted in accordance with the instruction
given in the proxy. If a choice is not specified in the proxy, the proxy will be
voted FOR the election of the director nominees listed below in Proposal 1 and
FOR Proposals 2 and 3 described in the following pages.
This Proxy Statement and the accompanying proxy are being mailed to
shareholders on or about August 13, 1999. The cost of preparing, assembling and
mailing the Notice of Annual Meeting of Shareholders, Proxy Statement and form
of Proxy and the cost of soliciting proxies will be paid by the Company. The
Company has retained Beacon Hill Partners, Inc. to handle the proxy solicitation
for a fee of approximately $4,500, plus reasonable out of pocket expenses.
Proxies may be solicited by personal interview, mail and telephone. Beacon Hill
Partners, Inc. has contacted brokerage houses, other custodians and nominees to
ask whether other persons are the beneficial owners of the shares that they hold
in street name, and if that is the case, will supply additional copies of the
proxy material for distribution to such beneficial owners. The Company will
reimburse such parties for their reasonable expenses in sending proxy materials
to the beneficial owners of the shares. In addition, some of the officers,
directors and employees of the Company may solicit proxies personally, by
telephone or fax.
Voting at the Meeting
The shares of Common Stock constitute the only class of securities of the
Company entitled to notice of, to attend and to vote at, the Annual Meeting.
Only shareholders of record at the close of business on August 11, 1999, will be
entitled to notice of and to vote at the Annual Meeting or any adjournment or
postponement thereof. As of August 11, 1999, there were 19,963,709 shares of
Common Stock issued and outstanding, each share being entitled to one vote on
each matter to be voted upon. The presence at the Annual Meeting, in person or
by proxy, of the holders of a majority of the shares of Common Stock outstanding
on August 11, 1999 will constitute a quorum.
Votes at the Annual Meeting, including those cast in person or by proxy,
will be tabulated by the Inspector of Elections appointed by the Board of
Directors. Abstentions and brokers non-votes are each included in the
determination of the number of shares present and voting for the purpose of
determining whether a quorum is present, and each is tabulated separately.
Abstentions will be treated as shares present and entitled to vote for purposes
of any matter for which a majority of shares present are required for passage
and, accordingly, will have the effect of votes against such matters. With
respect to shares relating to any proxy as to which a broker non-vote is
indicated on a matter, those shares will not be considered present and entitled
to vote with respect to any such matter and, accordingly will have no effect on
any matter for which a majority of shares present are required for passage.
Abstentions or non-votes or other failures to vote will have no such effect in
the election of directors, who will be elected by a plurality of the affirmative
votes cast. With respect to any matter brought before the Annual
2
<PAGE>
Meeting requiring the affirmative vote of a majority or other proportion of the
outstanding shares, an abstention or non-vote will have the same effect as a
vote against the matter being voted upon.
Security Ownership of Certain Beneficial Owners, Directors and Executive
Officers
The following table sets forth information concerning the ownership of the
Company's outstanding Common Stock as of August 8, 1999, except as otherwise
noted, by persons who are directors, Named Executive Officers (as defined under
the heading "Summary Compensation"), nominees or persons known to the Company to
be beneficial owners of five percent or more of its outstanding Common Stock.
The table also includes the stock ownership of all directors and Named Executive
Officers of the Company as a group.
<TABLE>
<CAPTION>
Number of Shares Percentage of Shares
Name and Address of Beneficial Owner Beneficially Owned (1) Outstanding (1)
- ------------------------------------ ---------------------- --------------------
<S> <C> <C>
Alfonso G. Cordero (2)................... 1,058,226 5.3%
Stephen C. Cooper........................ - -
Bruce C. Edwards (3)..................... 375,000 1.9%
Kevin T. Michaels (4).................... 42,023 *
Anthony J. Zuanich (5)................... 32,250 *
John L. Clendenin (6).................... 17,791 *
Gregory M. Avis.......................... - -
David L. George (7)..................... 16,375 *
Eugene L. Goda (8)...................... 19,375 *
Andrew J. Sukawaty (9)................... 10,625 *
All Executive Officers and Directors
as a Group (10 persons) (10)............. 1,571,665 7.8%
</TABLE>
* Less than 1%
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. Shares of Common Stock subject
to options or warrants currently exercisable, or exercisable within 60 days
of August 8, 1999, are deemed outstanding for computing the percentage of
the person holding such options or warrants but are not deemed outstanding
for computing the percentage of any other person. As of August 8, 1999, the
Company had a total of 19,963,052 shares of Common Stock issued and
outstanding. Except as indicated by footnote and subject to community
property laws where applicable, to the knowledge of the Company, the
persons named in this table have sole voting and investment power with
respect to all shares of Common Stock shown to be beneficially owned by
them.
(2) Includes 22,500 shares owned by Mr. Cordero's spouse. Mr. Cordero disclaims
beneficial ownership of such shares. Also includes 410,060 shares subject
to redemption by the Company for shares of Common Stock issued by the
Company in excess of 1,095,000 pursuant to the exercise of stock options
under the 1995 Stock Option Plan. See "Transactions with Management and
Others".
(3) Includes options exercisable for 75,000 shares within 60 days of August 8,
1999.
(4) Includes options exercisable for 41,125 shares within 60 days of August 8,
1999.
(5) Includes options exercisable for 31,250 shares within 60 days of August 8,
1999.
(6) Includes options exercisable for 14,791 shares within 60 days of August 8,
1999.
(7) Consists of options exercisable for 16,375 shares within 60 days of August
8, 1999.
(8) Consists of options exercisable for 19,375 shares within 60 days of August
8, 1999.
(9) Consists of options exercisable for 10,625 shares within 60 days of August
8, 1999.
(10) Includes 410,060 shares subject to redemption by the Company (see note 2)
and options exercisable for 208,541 shares within 60 days of August 8, 1999
(see notes 3, 4, 5, 6, 7, 8 and 9).
3
<PAGE>
Proposal 1
ELECTION OF DIRECTORS
Seven directors will be elected at the Annual Meeting. The number of
directors fixed by the bylaws of the Company are nine, however, the Company has
only identified, and is only nominating seven directors. Proxies cannot be voted
for more than seven director nominees. Each director elected at the Annual
Meeting will hold office until the next annual meeting of shareholders or until
their successor is duly elected and qualified. Unless authority to vote for
directors has been withheld in the proxy, the persons named in the enclosed
proxy intend to vote at the Annual Meeting for the election of the seven
nominees presented below. Persons named as proxies may not vote for the election
of any person to the office of director for which a bona fide nominee is not
named in the Proxy Statement. All nominees have consented to serve as a director
for the ensuing year. Although the Board of Directors does not contemplate that
any of the nominees will be unable to serve, if any nominee withdraws or
otherwise becomes unavailable to serve, the persons named in the enclosed proxy
will vote for any substitute nominee designated by the Board of Directors. The
nominees receiving a plurality of the affirmative votes will be elected. All the
nominees are currently serving as directors of the Company. The term of office
of each of the current directors expires on the date of the Annual Meeting.
The names and certain information concerning the persons to be nominated as
directors by the Board of Directors at the Annual Meeting are set forth below.
YOUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF EACH OF THE
---
NOMINEES NAMED BELOW.
Gregory M. Avis, 40, has been a member of the Company's Board of Directors
since October 1995. Mr. Avis has been a managing partner of Summit Partners, a
venture capital investment firm, since January 1990. Mr. Avis also serves on
the Board of Directors of Extended Systems, Inc. and Splash Technology Holdings,
Inc.
John L. Clendenin, 65, has been non-executive Chairman of the Company's
Board of Directors since January 3, 1999 and has been a member of the Company's
Board of Directors since May 1998. Mr. Clendenin is a Chairman Emeritus of
BellSouth Corporation, a telecommunications holding company. He served as
Chairman of the Board of BellSouth until December 31, 1997 and as President and
Chief Executive Officer from 1984 until his retirement at the end of 1996. Prior
to BellSouth, Mr. Clendenin was President of Southern Bell from April 1981 to
December 1983. He also serves on the Board of Directors of Coca-Cola
Enterprises, Inc., Equifax Inc., National Service Industries, Inc., Nabisco
Group Holdings, The Kroger Company, Springs Industries, Inc., The Home Depot,
Inc. and Wachovia Corporation.
Alfonso G. Cordero, 58, is one of the founders of the Company and has
served as a director since the Company's inception. From June 1985 to January
1996, Mr. Cordero served as Chief Executive Officer of the Company and from
January 1996 to January 1999 served as Chairman of the Company. Mr. Cordero is
currently Chairman Emeritus of the Company and continues to serve as a non-
employee director of the Company. Mr. Cordero also serves on the Board of
Directors of ComSpace Corporation, formerly known as Unique Technologies,
International, L.L.C.
Bruce C. Edwards, 45, joined the Company in February 1996 as President and
Chief Executive Officer and Director. Mr. Edwards was Executive Vice President,
Chief Financial Officer and Director of AST Research, Inc., a personal computer
company, from July 1994 to December 1995 and Senior Vice President, Finance and
Chief Financial Officer of AST Research, Inc. from March 1988 to July 1994. Mr.
Edwards currently serves on the Board of Directors of Diamond Multimedia
Systems, Inc., HMT Technology Corporation and Metawave Communications
Corporation.
David L. George, 46, has been a member of the Company's Board of Directors
since November 1995. Mr. George is a founder and has served as Executive Vice
President and Chief Technical Officer of ComSpace Corporation, formerly known as
Unique Technologies International, L.L.C., since February 1994. Mr. George also
serves on the Board of Directors of ComSpace Corporation. From November 1983 to
February 1994, Mr. George served as Vice President, Director of Operations,
Commercial Division of Uniden America.
Eugene L. Goda, 63, has been a member of the Company's Board of Directors
since November 1995. Since June 1997, Mr. Goda has served as Chairman of the
Board, President and Chief Executive Officer of Objectshare
4
<PAGE>
Inc., formerly known as Park Place Digitalk, a software company. From October
1991 to October 1995, Mr. Goda served as Chief Executive Officer of Simulation
Sciences, Inc., a software company. From July 1989 to September 1991, he served
as Chief Executive Officer of Meridian Software Systems.
Andrew J. Sukawaty, 44, has been a member of the Company's Board of
Directors since May 1998. Mr. Sukawaty has served as Chief Executive Officer of
Sprint PCS since September 1996. Since November 1998, Mr. Sukawaty has also
served as President and Chief Executive Officer of the PCS Group of Sprint
Corporation. Prior to joining Sprint PCS, Mr. Sukawaty was Chief Executive
Officer of NTL Limited, a British diversified broadcast transmission and
communications company, since 1994. From 1989 to 1994, he was Chief Operating
Officer of Mercury One-2-One, a PCS service provider in the United Kingdom.
Prior to 1989, Mr. Sukawaty held various positions with US WEST, Inc., a
telecommunications holding company.
Board Committees, Attendance at Meetings and Compensation
The Audit Committee of the Board of Directors for the fiscal year ended
January 3, 1999 consisted of Messrs. Avis and George. The Audit Committee
recommends to the Board of Directors the independent public accountants to be
selected to audit the Company's annual financial statements and approves any
special assignments given to such accountants. The Audit Committee also reviews
the planned scope of the annual audit and the independent accountants' letter of
comments and management's response thereto, any major accounting changes made or
contemplated and the effectiveness and efficiency of the Company's internal
accounting staff. The Audit Committee held one meeting during the fiscal year
ended January 3, 1999.
The Compensation Committee for the fiscal year ended January 3, 1999
consisted of Messrs. Goda, Clendenin and Sukawaty. The Compensation Committee
establishes remuneration levels for executive officers of the Company, reviews
management organization and development, and reviews executive compensation and
significant employee benefit programs. The Compensation Committee held one
meeting during the fiscal year ended January 3, 1999. The Board of Directors
does not have a standing nominating committee.
For fiscal 1998, the Company's non-employee directors, other than Gregory
M. Avis who waived his fees, received a retainer fee of $20,000 per year payable
in quarterly installments and $1,000 per meeting attended (excluding phone
meetings) of the Board of Directors. The non-executive Chairman of the Board of
Directors receives an additional retainer fee of $20,000 per year payable in
quarterly installments. Directors of the Company who are also employees receive
no additional compensation for their services as a director.
Effective December 5, 1998, each of the non-employee directors and non-
affiliated directors (Messrs. Clendenin, George, Goda and Sukawaty) were granted
an option to purchase 5,000 shares of Common Stock at an exercise price of
$12.4375 per share under the 1996 Director Stock Option Plan. Upon their
appointment as directors in May of 1998, Mr. Clendenin and Mr. Sukawaty were
each granted an option to purchase 30,000 shares of Common Stock at an exercise
price of $18.125 per share. On December 2, 1998, Mr. Clendenin was granted an
option to purchase 20,000 shares of Common Stock at an exercise price of $11.875
per share, in relation to his appointment as non-executive Chairman of the Board
of Directors, which became effective January 3, 1999.
The Board of Directors held ten meetings during the fiscal year ended
January 3, 1999. Each director attended at least 75% of all meetings of the
Board of Directors, with the exception of Messrs. Avis and Sukawaty, and each
director attended all committee meetings on which that director served.
1996 Director Stock Option Plan
The Company's 1996 Director Stock Option Plan (the "Director Plan"), became
effective December 5, 1996, and was amended in August 1998 to increase the
number of shares of Common Stock available for issuance under the plan from
200,000 to 400,000. The Director Plan provides that each member of the
Company's Board of Directors who is not an employee or paid consultant of the
Company automatically will be eligible to receive options to purchase stock
under the Director Plan. Pursuant to the terms of the Director Plan, each
director elected after December 5, 1996 will be granted an initial option under
the plan covering 30,000 shares of Common Stock, which option shall vest at the
rate of 25% on the first anniversary of the grant date and the remaining 75%
shall vest in equal monthly installments over the following three years.
Furthermore, on December 5, 1996 and on each
5
<PAGE>
anniversary date thereof, each director who shall have been an eligible
participant under the Director Plan for at least six (6) months shall be granted
an annual option under the Director Plan to purchase 5,000 shares of Common
Stock. There are 110,000 options outstanding under the Director Plan as of
August 8, 1999 at a weighted average exercise price of $17.19 per share.
Proposal 2
APPROVAL OF AN AMENDMENT TO THE 1996 STOCK INCENTIVE PLAN TO INCREASE THE NUMBER
OF SHARES OF COMMON STOCK ISSUABLE THEREUNDER FROM 3,000,000 TO 5,000,000
The Board of Directors recommends a vote FOR the amendment to the 1996 Stock
Incentive Plan.
In July 1999, the Board of Directors, subject to the approval of the
shareholders, adopted an amendment to the Company's 1996 Stock Incentive Plan
(the "1996 Plan") to increase the number of shares of Common Stock authorized
for issuance under the 1996 Plan by 2,000,000, thereby increasing the total
number of shares of Common Stock authorized for issuance under the 1996 Plan
from 3,000,000 to 5,000,000. As of August 8, 1999, there were 966,523 shares of
Common Stock available for issuance under the 1996 Plan. The 1996 Plan, as
amended, was originally approved by the Company's shareholders in 1996. The
purposes of the 1996 Plan are to attract and retain the best available personnel
for positions of substantial responsibility with the Company and to provide
participants with additional incentives in the form of options to purchase the
Company's Common Stock which will encourage them to acquire a proprietary
interest in, and to align their financial interests with those of the Company
and its shareholders.
The 1996 Plan provides for the granting of incentive stock options within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended,
nonstatutory options and restricted stock grants to directors, officers,
employees and consultants of the Company, except that incentive stock options
may not be granted to non-employee directors or consultants. The 1996 Plan is
administered by the Compensation Committee of the Board of Directors, which has
sole discretion and authority, consistent with the provisions of the 1996 Plan,
to determine which eligible participants will receive options, the time when
options will be granted, the terms of options granted and the number of shares
which will be subject to options granted under the 1996 Plan.
Approval of the amendment to the 1996 Plan to increase the number of shares
issuable thereunder will require the affirmative vote of the holders of a
majority of the outstanding shares of the Company's Common Stock present or
represented and voting at the Annual Meeting.
Any shareholder may obtain a copy of the 1996 Plan by writing to Powerwave
Technologies, Inc., 2026 McGaw Avenue, Irvine, California 92614, Attention:
Corporate Secretary.
Proposal 3
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors recommends a vote FOR the proposal to ratify the
appointment of Deloitte & Touche LLP as independent auditors of the Company for
the 1999 fiscal year.
The Board of Directors, acting upon the recommendation of the Audit
Committee, has appointed the independent accounting firm of Deloitte and Touche
LLP, certified public accountants, to audit the accounts of Powerwave
Technologies, Inc. and its subsidiaries for the 1999 fiscal year. Deloitte and
Touche LLP has audited the accounts and records of Powerwave Technologies, Inc.,
and its subsidiaries since 1995. If the shareholders do not ratify the
appointment of Deloitte & Touche LLP, the Board will reconsider the appointment
of independent public accountants.
6
<PAGE>
Representatives of Deloitte and Touche LLP are expected to be present at
the Annual Meeting and will have the opportunity to make a statement if they so
desire and will also be available to respond to appropriate questions.
Executive Officers
The following table sets forth certain information regarding the Company's
executive officers:
<TABLE>
<CAPTION>
Name Position
---- --------
<S> <C>
Bruce C. Edwards..... President, Chief Executive Officer and Director
Stephen C. Cooper.... Executive Vice President, Operations
Kevin T. Michaels.... Vice President, Finance, Chief Financial Officer and Secretary
Anthony J. Zuanich... Senior Vice President, Sales and Marketing
</TABLE>
Bruce C. Edwards, 45, joined the Company in February 1996 as President and
Chief Executive Officer and Director. Mr. Edwards was Executive Vice President,
Chief Financial Officer and Director of AST Research, Inc., a personal computer
company, from July 1994 to December 1995 and Senior Vice President, Finance and
Chief Financial Officer of AST Research, Inc. from March 1988 to July 1994. Mr.
Edwards currently serves on the Board of Directors of Diamond Multimedia
Systems, Inc., HMT Technology Corporation and Metawave Communications
Corporation.
Stephen C. Cooper, 50, joined the Company in February 1999 as Executive
Vice President, Operations. Prior to joining the Company, Mr. Cooper worked for
Hewlett Packard Company for the past 25 years in a variety of management
positions in the United States and Asia. Most recently, Mr. Cooper was the
Operations Manager for the Hewlett Packard Power Amplifier business in Folsom,
California which was acquired by Powerwave in October 1998.
Kevin T. Michaels, 40, joined the Company in June 1996 as Vice President,
Finance and Chief Financial Officer and was appointed Secretary in June 1996.
Prior to joining the Company, Mr. Michaels worked for AST Research, Inc. for
eight years, most recently as Vice President, Treasurer from October 1995 to
June 1996. From July 1991 to October 1995 Mr. Michaels was Treasurer of AST
Research, Inc. and from June 1988 to June 1991, he was Assistant Treasurer.
Anthony J. Zuanich, 55, joined the Company in June 1998 as Senior Vice
President, Sales and Marketing. Prior to joining the Company, Mr. Zuanich was
employed at Gregory Associates as Senior Vice President, Global Sales and
Marketing from July 1995 to December 1997. From December 1973 to October 1994,
Mr. Zuanich held various executive positions at Triad Systems Corporation, an
integrated computer systems manufacturer.
7
<PAGE>
Summary Compensation
The following table sets forth summary information concerning compensation
paid by, or accrued for services rendered to, the Company in all capacities
during the past three fiscal years to the Company's Chief Executive Officer and
to each of the three additional officers whose salary and bonus exceeded
$100,000 (the "Named Executive Officers").
Summary Compensation Table
--------------------------
<TABLE>
<CAPTION>
Long-term
Compensation
Annual ------------
Compensation Awards
--------------------- ------------ All Other
Name and Principal Position Year Salary ($) Bonus ($) Options (#) Compensation ($)
- ---------------------------------------- ---- ---------- --------- ------------ ----------------
<S> <C> <C> <C> <C> <C>
Alfonso G. Cordero....................... 1998 102,066 - - 34,758(1)
Chairman Emeritus and Director (2) 1997 85,000 430,000 - 39,813
1996 85,000 250,000 - 12,691
Bruce C. Edwards (3)..................... 1998 179,230 - 75,000 3,474(4)
President and Chief Executive Officer 1997 135,000 375,000 - 15,400
1996 114,230 175,000 450,000 208
Kevin T. Michaels (5).................... 1998 124,230 - 50,000 5,289(6)
Vice President, Finance, 1997 99,231 90,000 - 13,943
Chief Financial Officer and Secretary 1996 48,642 40,000 90,000 1,083
Anthony J. Zuanich(7).................... 1998 94,230 - 100,000 121,177(8)
Senior Vice President, Sales and 1997 - - - -
Marketing 1996 - - - -
</TABLE>
- -------------------
(1) Included in this amount is the Company's 401(k) plan matching contribution
of $1,456, health care coverage of $1,898, life insurance premiums of
$17,779 and $13,625 of automobile expenses.
(2) Mr. Cordero retired as Chairman of the Board of Directors effective January
3, 1999.
(3) Bruce Edwards joined the Company as President and Chief Executive Officer
in February 1996.
(4) Included in this amount is the Company's 401(k) plan matching contribution
of $2,000 and health care coverage of $1,474.
(5) Kevin Michaels joined the company as Vice President, Finance and Chief
Financial Officer in June 1996.
(6) Included in this amount is the Company's 401(k) plan matching contribution
of $2,000 and health care coverage of $3,289.
(7) Anthony Zuanich joined the Company as Senior Vice President, Sales and
Marketing in June of 1998 at a base salary of $175,000 and an annual
commission of $75,000.
(8) Includes $40,385 of annual commission, $80,000 of relocation expenses and
health care coverage of $792.
8
<PAGE>
Option Grants in Last Fiscal Year
The following table sets forth certain information concerning grants of
options to each of the Company's Named Executive Officers during the fiscal year
ended January 3, 1999. In addition, in accordance with the rules and
regulations of the Securities and Exchange Commission, the following table sets
forth the hypothetical gains that would exist for the options based on the
assumption that the stock price were to appreciate annually by 5% and 10%,
respectively. The rates do not represent the Company's estimate or projection
of future Common Stock prices and no assurance can be given that the share price
will appreciate at the rates shown in the table.
Option Grants During Fiscal 1998
<TABLE>
<CAPTION>
Potential Realizable Value
Number of % of Total at Assumed Annual Rates
Securities Options of Stock Price Appreciation
Underlying Granted to Exercise for Option Term
Options Employees in Price Expiration ---------------------------
Name Granted (#) Fiscal Year (1) ($/Share) Date (2) 5% 10%
------------ ----------- --------------- --------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Bruce C. Edwards 75,000 4.62% $13.750 02/10/08 648,548 1,643,547
Kevin T. Michaels 50,000 3.08% $13.750 02/10/08 432,365 1,095,698
Anthony J. Zuanich 100,000 6.16% $17.875 06/01/08 1,124,149 2,848,815
</TABLE>
(1) Options to purchase an aggregate of 1,624,050 shares of Common Stock were
granted to employees, including the Named Executive Officers, during the
fiscal year ended January 3, 1999.
(2) Options granted have a term of 10 years, subject to earlier termination in
certain events related to termination of employment.
Aggregated Option Exercises in Last Fiscal Year and Year End Value Table
The following table sets forth certain information concerning the exercise
of options by each of the Company's Named Executive Officers during the fiscal
year ended January 3, 1999, including the aggregate value of gains on the date
of exercise. In addition, the table includes the number of shares covered by
both exercisable and unexercisable stock options as of January 3, 1999. Also
reported are the values for "in the money" options which represent the positive
spread between the exercise prices of any such existing stock options and the
fiscal year end price of common stock.
Aggregated Option Exercises during Fiscal 1998
and Option Values at January 3, 1999
<TABLE>
<CAPTION>
Number of Securities Value of
underlying unexercised Unexercised In-the-Money
Shares Options at 01/03/99 Options at 01/03/99 (2)
Acquired Value -------------------------- --------------------------
Name on Exercise Realized (1) Exercisable Unexercisable Exercisable Unexercisable
-------- ----------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Bruce C. Edwards 178,125 $1,019,137 37,500 196,875 $598,437 $2,310,546
Kevin T. Michaels - - 31,250 83,750 $436,198 $ 714,844
Anthony J. Zuanich - - - 100,000 - $ 75,000
</TABLE>
(1) Market value on the date of exercise of shares, less option exercise price.
(2) In accordance with the Securities and Exchange Commission's rules, values
are calculated by subtracting the exercise price from the fair market value
of the underlying common stock. For purposes of this table, fair market
value per share is deemed to be $18.625, the closing common stock price
reported by Nasdaq on December 31, 1998.
9
<PAGE>
Compensation Committee Interlocks and Insider Participation
During fiscal 1998, the Compensation Committee consisted of John L.
Clendenin, Eugene L. Goda and Andrew J. Sukawaty, none of whom served as an
employee of the Company.
Transactions with Management and Others
David L. George, a member of the Board of Directors of the Company, is an
Executive Vice President and Director of ComSpace Corporation. Alfonso G.
Cordero, a director and Chairman Emeritus of the Company, is also a member of
the Board of Directors of ComSpace Corporation. During fiscal 1997, ComSpace
Corporation was a customer of the Company and purchased products from the
Company on terms which management believes were no less favorable than could
otherwise be obtained from unaffiliated third parties. Sales to ComSpace
Corporation were $0 in fiscal 1998 and less than $35,000 in fiscal 1997.
Pursuant to a Stockholders' Agreement dated October 10, 1995, as amended,
the Company and its then existing shareholders (the "Founders") agreed that the
Company would redeem from the Founders, on a pro rata basis, an equal number of
shares of Common Stock for each share of Common Stock in excess of 1,095,000
issued by the Company upon the exercise of Company stock options granted under
the 1995 Stock Option Plan ("the 1995 Plan") at a redemption price equal to the
exercise price for such option. Up to 1,938,615 shares of the Company's Common
Stock were reserved for issuance under the 1995 Plan. Effective December 5,
1996, those certain shareholders and the Company agreed that this share
redemption agreement applies only to the exercise of options to purchase a total
of 843,615 shares of the Company's Common Stock. In connection with entering
into the Stockholders' Agreement, the Company amended the 1995 Plan to provide
that all option grants in excess of 1,050,000 are subject to the approval of
Alfonso G. Cordero and to give Mr. Cordero the right to terminate the granting
of additional option grants under the 1995 Plan. As of August 8, 1999, a total
of 1,276,680 options have been exercised under the 1995 Plan and there were
661,039 options outstanding under the 1995 Plan.
The Company leases its main operating facility located at 2026 McGaw
Avenue, Irvine, California, from CNH, LLC, a California limited liability
company owned by the holders of approximately 11% of the Company's Common Stock
outstanding as of January 3, 1999, including Mr. Alfonso G. Cordero. The lease
expires on July 15, 2006. Total rent paid in fiscal 1998 to CNH, LLC was
$714,810. The Company has also entered into a lease agreement with CNH, LLC, for
a facility which is currently under construction at 2008 McGaw Avenue, Irvine,
California, which is adjacent to the Company's main operating facility. This new
facility is expected to be available in October 1999. The Company also leases
additional parking spaces from CNH, LLC.
On April 28, 1998 the Company purchased $2.5 million of 13.75% Senior
Secured Bridge Notes due April 28, 2000 (the "Notes") from Metawave
Communications Corporation in a private offering. The total amount raised in the
offering was $29.0 million. The Notes initially accrued interest at a rate of
13.75% per annum and interest was payable semi-annually. The Notes contained
provisions to increase the rate of interest during the life of the Notes if the
Notes were not repaid prior to maturity. The Notes were secured by certain
assets of Metawave Communications Corporation and were redeemed in full on April
28, 1999. Upon the redemption of the Notes, the Company received related
warrants for shares of Metawave Communications Corporation Series D Preferred
Stock. For fiscal 1998, Metawave Communications Corporation accounted for
approximately 8% of the Company's revenues. The President of the Company joined
the Board of Directors of Metawave Communications Corporation in May 1998.
In June 1997, the Company entered into an agreement to purchase 45% of the
capital stock of Teletransfer, S.A. de C.V., ("Teletransfer") a private Mexican
company operating several two-way dispatch radio services in Mexico. The
Company invested a total of $600,000 for its 45% interest in the Teletransfer.
Due to ongoing operating losses at Teletransfer since 1997, the Company has
expensed the majority of its investment in Teletransfer. Beginning in 1998, the
Company undertook efforts to sell its investment in Teletransfer. In June 1999,
the Company sold its entire investment in Teletransfer to Mr. Alfonso G. Cordero
for $300,000. Pursuant to the terms of the sale agreement, if within eighteen
(18) months of the sale Mr. Cordero is able to sell the investment in
Teletransfer at a price greater than $300,000, Mr. Cordero will pay to the
Company the amount the investment is sold for greater than $300,000 up to a
maximum additional amount of $300,000.
10
<PAGE>
The Company has entered into indemnification agreements with its directors,
certain executive officers and certain affiliated entities. Such agreements
require the Company to indemnify such individuals to the fullest extent
permitted by Delaware law.
The Company believes that all of the transactions set forth above were made
on terms no less favorable to the Company than could otherwise be obtained from
unaffiliated third parties.
1995 Stock Option Plan
The Company's 1995 Stock Option Plan (the "1995 Plan"), as amended, permits
executive personnel, key employees and non-employee members of the Board of
Directors of the Company to participate in ownership of the Company. The 1995
Plan is administered by the Compensation Committee of the Company's Board of
Directors. Each option agreement includes a provision requiring the Optionee to
consent to the terms of the agreement. The 1995 Plan provides for the grant of
nonstatutory stock options under the applicable provisions of the Internal
Revenue Code. The option price per share may not be less than 85% of the fair
market value of a share of Common Stock on the grant date as determined by the
closing price of the Company's Common Stock as reported by Nasdaq on the grant
date. In addition, the exercise price may not be less than 110% of the fair
market value of a share of Common Stock on the grant date for any individual
possessing 10% or more of the voting power of all classes of stock of the
Company. Options generally vest at the rate of 25% on the first anniversary date
and 2% per month thereafter and expire no later than ten years after the grant
date. Up to 1,938,615 shares of the Company's Common Stock were reserved for
issuance under the 1995 Plan. Pursuant to the Stockholders' Agreement with the
Company, certain shareholders of the Company have agreed that, once the Company
has issued an initial 1,095,000 shares of Common Stock under the 1995 Stock
Option Plan, any additional shares issued under the 1995 Plan upon an option
exercise will be coupled with a pro rata redemption from those shareholders of
an equal number of shares at a redemption price equaling the option exercise
price. The Company and those certain shareholders have agreed that this share
redemption agreement applies only to the exercise of options to purchase a total
of 843,615 shares of the Company's Common Stock. See "Transactions with
Management and Others." As of August 8, 1999, a total of 1,276,680 options have
been exercised under the 1995 plan and there were 661,039 options outstanding
under the 1995 Plan at a weighted average exercise price of $5.99 per share.
The 1995 Plan provides that the 1995 Plan itself and all outstanding
options shall terminate upon the occurrence of a consolidation or merger in
which the Company is not the surviving corporation or the sale of substantially
all of the Company's assets and certain other similar events, in each case
unless the 1995 Plan is assumed by the successor corporation. In the event that
an option holder's employment is terminated (other than for cause) within 180
days after any such transaction, such option holder's options shall become
exercisable in full on the date of termination.
The 1995 Plan provides that all option grants under the Plan in excess of
1,050,000 are subject to the approval of Alfonso G. Cordero. In addition, the
granting of additional option grants under the 1995 Plan may be terminated at
the discretion of Mr. Cordero.
1996 Stock Incentive Plan
The Company's 1996 Stock Incentive Plan (the "1996 Plan"), as amended,
became effective December 5, 1996, and was amended in August 1998 to increase
the number of shares of Common Stock available for issuance under the plan from
1,500,000 to 3,000,000. The 1996 Plan currently covers an aggregate of 3,000,000
shares of Common Stock plus any shares which are or become available for grant
under the 1995 Plan, and the Company is seeking to obtain the approval of the
Company's shareholders to increase the number of shares issuable under the 1996
Plan from 3,000,000 to 5,000,000 (See "Proposal 2"). The 1996 Plan provides for
the granting of "incentive stock options," within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code"), nonstatutory options
and restricted stock grants to directors, officers, employees and consultants of
the Company, except that incentive stock options may not be granted to non-
employee directors or consultants. As of August 8, 1999, all of the options
granted under the 1996 Plan have been nonstatutory options. The purpose of the
1996 Plan is to provide participants with incentives which will encourage them
to acquire a proprietary interest in, and continue to provide services to, the
Company. The 1996 Plan is administered by the Compensation Committee of the
Board of Directors, which has sole discretion and authority, consistent with the
provisions of the 1996 Plan, to determine which eligible participants will
receive options, the time when options will be granted, the terms of
11
<PAGE>
options granted and the number of shares which will be subject to options
granted under the 1996 Plan. As of August 8, 1999, a total of 111,796 options
have been exercised under the 1996 Plan and there were 1,921,81 options
outstanding under the 1996 Plan at a weighted average exercise price of $15.57
per share.
In the event of a merger of the Company with or into another corporation,
or a consolidation, acquisition of stock or assets or other change in control
transaction involving the Company, each option becomes exercisable in full,
unless such option is assumed by the successor corporation. In the event the
transaction is not approved by a majority of the "Continuing Directors" (as
defined in the 1996 Plan), each option becomes fully vested and exercisable in
full immediately prior to the consummation of such transaction, whether or not
assumed by the successor corporation. In addition, in the event that an option
holder's employment by the Company is terminated (other than for cause) within
180 days after a change in control, such option holder's options become
exercisable in full on the date of termination.
Employee Stock Purchase Plan
On October 7, 1996, the shareholders of the Company approved the Employee
Stock Purchase Plan (the "Purchase Plan"), which became effective on December 5,
1996. The Purchase Plan covers an aggregate of 500,000 shares of Common Stock.
The Purchase Plan, which is intended to qualify as an "employee stock purchase
plan" under Section 423 of the Internal Revenue Code, is implemented utilizing
six-month offerings with purchases occurring at six month intervals. The
Purchase Plan is administered by the Board of Directors. Employees are eligible
to participate if they are employed by the Company for at least 20 hours per
week and if they have been employed by the Company for at least 90 days. The
Purchase Plan permits eligible employees to purchase Common Stock through
payroll deductions, which may not exceed 20% of an employee's compensation. The
price of Common Stock purchased under the Purchase Plan will be 85% of the lower
of the fair market value of the Common Stock at the beginning of each six-month
offering period or on the applicable purchase date. Employees may end their
participation in any offering at any time during the offering period, and
participation ends automatically on termination of employment. The Board may at
any time amend or terminate the Purchase Plan, except that no such amendment or
termination may adversely affect options previously granted under the Purchase
Plan. A total of 156,259 shares of the Company's Common Stock have been
purchased under the Purchase Plan as of August 8, 1999. At August 8, 1999 there
were rights to purchase approximately 1,700 shares outstanding under the
Purchase Plan and there were 343,741 shares available for purchase under the
plan.
401(k) and Profit Sharing Plan
The Company sponsors a Future Income Program Plan and Trust (the "401(k)
Plan") covering the Company's full-time employees located in the United States.
The 401(k) Plan is intended to qualify under Section 401(k) of the Code, so that
contributions to the 401(k) Plan by employees or by the Company, and the
investment earnings thereon, are not taxable to employees until withdrawn from
the 401(k) Plan, and so that contributions by the Company, if any, will be
deductible by the Company when made. Pursuant to the 401(k) Plan, employees may
elect to reduce their current compensation by up to 15% of their base salary,
subject to Internal Revenue Service limitations, and to have the amount of such
reduction contributed to the 401(k) Plan.
The 401(k) Plan provided for employer matching contributions up to a
maximum of 20% of each eligible employee's annual contribution for the year
ended January 3, 1999. For fiscal 1998, the Company contributed $157,054 to the
plan as matching contributions.
The 401(k) plan permits, but does not require, additional profit sharing
contributions from the Company on behalf of eligible employees. Any profit
sharing contribution is approved by the Board of Directors. There were no profit
sharing contributions authorized for the year ended January 3, 1999.
Board Compensation Committee Report on Executive Compensation
The Company's compensation policies applicable to its executive officers
are administered by the Compensation Committee (the "Committee") of the Board of
Directors. The Committee is made up of three non-employee directors. The
Company's executive compensation programs are designed to attract, motivate and
retain
12
<PAGE>
the executive talent needed to optimize shareholder value. The programs are
designed to enhance shareholder value by aligning the financial interests of the
executive officers of the Company with those of its shareholders.
Compensation Philosophy
The Company's executive compensation programs are based on the belief that
the interests of the executives should be closely aligned with the Company's
shareholders. In support of this philosophy, a meaningful portion of each
executive's compensation is placed at-risk and is linked to the accomplishment
of specific results that are expected to lead to the creation of value for the
Company's shareholders from both the short-term and long-term perspectives. With
this pay-for-performance and shareholder alignment orientation, the Company's
compensation policies and programs are designed to (1) attract, develop, reward
and retain highly qualified and productive individuals; and (2) motivate
executives to improve the overall performance and profitability of the Company.
There are three primary components of executive compensation: base salary,
the annual management bonus plan, and stock option grants. While the elements of
compensation are considered separately, the Committee takes into account the
total compensation package afforded by the Company to the individual executive.
Base Salary. Salaries paid to executive officers (other than the Chairman
and the Chief Executive Officer) are reviewed annually by the Chairman and the
Chief Executive Officer based upon their assessment of the nature of the
position and the contribution, experience and Company tenure of the executive
officer. The Chairman and the Chief Executive Officer review all salary
recommendations with the Committee. The Chairman reviews any salary
recommendations for the Chief Executive Officer with the Committee, which then
approves or disapproves such recommendations. The Committee, excluding the
Chairman, reviews the salary of the Chairman and establishes the Chairman's
salary based upon their assessment of the performance of the Chairman and his
contribution to the Company.
Annual Management Bonus. There were no management bonuses paid in fiscal
1998.
Stock Options. Stock options are designed to align the interests of
executives with those of the shareholders. Stock option grants may be made to
executive officers when one of the following events occurs: upon initial
employment, upon promotion to a new, higher level position that entails
increased responsibilities and accountability, for the recognition of superior
performance or as an incentive for continual service with the Company as well as
continued superior performance. The Chairman or the Chief Executive Officer
recommends the number of options to be granted, within a range associated with
the individual executive's salary level, and presents this to the Committee and
the entire Board of Directors for their review and approval. The Committee takes
into account the total compensation offered to its executives when considering
the number of options awarded. The Chief Executive Officer and the Chief
Financial Officer comprise the members of the Company's Option Committee, and
are empowered by the Board of Directors and the Committee to grant options to
non-officer employees of the Company up to a grant amount of 20,000 shares per
employee. All grants for employees of the Company in excess of this amount are
submitted to the Committee for approval. All grants for officers of the Company
are submitted to both the Committee and the entire Board of Directors for
approval.
Policy Regarding Section 162(m) of the Internal Revenue Code
The Committee has reviewed the Company's executive compensation plans to
determine if revisions may be necessary due to provisions of Section 162(m) of
the Internal Revenue Code which generally disallows a tax deduction to public
corporations for compensation paid to any of the corporation's executive
officers in excess of $1,000,000 during any fiscal year. It is the current
policy of the Committee to preserve, to the extent reasonably possible, the
Company's ability to obtain a corporate tax deduction for compensation paid to
executive officers of the Company to the extent consistent with the best
interests of the Company and its shareholders. The Committee is reviewing the
Company's existing executive compensation plans and will propose changes, if
necessary and reasonable, to ensure compliance with the provisions of Section
162(m) which allow performance-based compensation to be excluded from the
deduction limits.
13
<PAGE>
The Compensation Committee of the Board of Directors:
John L. Clendenin
Eugene L. Goda
Andrew J. Sukawaty
Market for Registrant's Common Equity and Related Shareholder Matters
The Company's Common Stock is quoted on the Nasdaq National Market ("Nasdaq")
under the symbol PWAV. Set forth below are the high and low sales prices as
reported by Nasdaq for the Company's Common Stock for the periods indicated.
<TABLE>
<CAPTION>
High Low
---- ---
<S> <C> <C>
Fiscal Year 1996
December 6, 1996 through December 29, 1996....... $ 16 1/4 $ 11
Fiscal Year 1997
First Quarter Ended March 30, 1997............... $ 25 $ 14
Second Quarter Ended June 29, 1997............... $ 23 7/8 $ 14 1/2
Third Quarter Ended September 28, 1997........... $ 45 1/4 $ 21 3/8
Fourth Quarter Ended December 28, 1997........... $ 49 $ 13 1/8
Fiscal Year 1998
First Quarter Ended March 29, 1998............... $ 20 $ 9 1/8
Second Quarter Ended June 28, 1998............... $22 15/16 $ 13 1/8
Third Quarter Ended September 27, 1998........... $ 19 $ 6 3/8
Fourth Quarter Ended January 3, 1999............. $ 20 $ 5 5/8
Fiscal Year 1999
First Quarter Ended April 4, 1999................ $ 31 3/16 $16 13/16
Second Quarter Ended July 4, 1999................ $ 36 7/8 $ 21 5/8
Third Quarter through August 11, 1999............ $ 39 3/16 $ 30 3/8
</TABLE>
There were approximately 50 security holders of record as of August 11, 1999.
The Company believes there are approximately 5,000 shareholders of the Company's
Common Stock held in street name. The Company has not paid any dividends to
date and does not anticipate paying any dividends on the Common Stock in the
foreseeable future. The Company anticipates that all future earnings will be
retained to finance future growth.
14
<PAGE>
Stock Performance Comparison
The following graph compares the cumulative total shareholder returns for the
Company's Common Stock with the cumulative total return of the S&P 500 Index,
and the S&P Communication Equipment Index. The presentation assumes $100
invested on December 5, 1996 in the Company's Common Stock, the S&P 500 Index
and the S&P Communication Equipment Index with all dividends reinvested. No
cash dividends were declared on the Company's Common Stock during this period.
Shareholder returns over the indicated period should not be considered
indicative of future shareholder returns.
[PERFORMANCE GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
POWERWAVE S&P
Measurement Period TECHNOLOGIES, S&P 500 COMMUNICATIONS
(Fiscal Year Covered) INC. INDEX EQUIPMENT
- --------------------- ------------- ------- --------------
<S> <C> <C> <C>
Measurement Pt-12/06/96 $100 $100 $100
FYE 12/96 $130 $ 98 $ 99
FYE 12/97 $122 $131 $129
FYE 12/98 $162 $168 $227
</TABLE>
15
<PAGE>
ANNUAL REPORT
The Company's Annual Report, including financial statements and schedules
thereto for the fiscal year ended January 3, 1999 is being forwarded to each
shareholder with this proxy statement. The Annual Report is not to be regarded
as proxy soliciting material or as a communication by means of which any
solicitation is to be made.
OTHER MATTERS
The Board of Directors has no knowledge of any other matters which shall come
before the Annual Meeting. If any other matters shall properly come before the
Annual Meeting, the persons named in the proxies will have discretionary
authority to vote the shares thereby represented in accordance with their best
judgment.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership with the Securities and Exchange Commission ("SEC") and Nasdaq.
Directors, executive officers and greater than ten-percent beneficial owners are
required by SEC regulations to furnish the Company with copies of all Section
16(a) forms they file.
Based solely on a review of the copies of such forms received by the Company
and on written representations from certain reporting persons that no Forms 5
were required for those persons, the Company believes that, during the period
from December 29, 1997 to January 3, 1999, all filing requirements applicable to
its directors, executive officers and greater than ten-percent beneficial owners
were met.
PROPOSALS OF SHAREHOLDERS
Any shareholders desiring to submit a proposal for action at the Company's
next Annual Meeting of Shareholders and presentation in the Company's Proxy
Statement with respect to such meeting should arrange for such proposal to be
delivered to the Secretary of the Company at its principal place of business no
later than February 1, 2000 in order to be considered for inclusion in the
Company's Proxy Statement relating to that meeting. Matters pertaining to such
proposals, including the number and length thereof, eligibility of persons
entitled to have such proposals included and other aspects are regulated by the
Securities and Exchange Act of 1934, Rules and Regulations of the SEC and other
laws and regulations to which interested persons should refer.
On May 21, 1998 the SEC adopted an amendment to Rule 14a-4 as promulgated
under the Securities and Exchange Act of 1934, as amended. The amendment to
Rule 14a-4(c) (1) governs the Company's use of its discretionary proxy voting
authority with respect to a shareholder proposal which is not addressed in the
Company's Proxy Statement. The new amendment provides that the Company will be
allowed to use its discretionary voting authority when the proposal is raised at
the meeting, without any discussion of the matter in the Proxy Statement, in two
situations: (i) if a proponent of a proposal fails to notify the Company at
least 45 days prior to the current year's anniversary of the date of the mailing
of the prior year's Proxy Statement, or (ii) if the date of the Company's annual
meeting has changed by more than thirty (30) days from the prior year, if notice
is not received a reasonable time before the Company mails the Proxy Statement
for the current year.
With respect to the Company's 1999 Annual Meeting of Shareholders, the Company
has not been provided notice of any shareholder proposals, which such
shareholders previously sought to include in the Company's Proxy Statement by
June 15, 1999. Therefore, the Company will be allowed to use its voting
authority as discussed above.
Submitted by:
Kevin T. Michaels
Vice President, Finance
Chief Financial Officer and Secretary
Dated: August 13, 1999
16
<PAGE>
COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K (WITHOUT EXHIBITS) AS FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION WILL BE PROVIDED TO SHAREHOLDERS
WITHOUT CHARGE UPON WRITTEN REQUEST TO THE CORPORATE SECRETARY, POWERWAVE
TECHNOLOGIES, INC., 2026 MCGAW AVENUE, IRVINE, CALIFORNIA 92614. SHAREHOLDERS
CAN ALSO ELECTRONICALLY REQUEST THE ANNUAL REPORT USING THE COMPANY'S INVESTOR
RELATIONS PAGE ON ITS WORLDWIDE WEB SITE AT WWW.POWERWAVE.COM. THE COMPANY'S WEB
SITE DOES NOT CONSTITUTE PART OF THIS PROXY AND IS NOT REGARDED AS PROXY
SOLICITING MATERIAL OR AS A COMMUNICATIONS BY MEANS OF WHICH ANY SOLICITATION IS
TO BE MADE.
17
<PAGE>
REVOCABLE PROXY
POWERWAVE TECHNOLOGIES, INC.
ANNUAL MEETING OF SHAREHOLDERS--September 20, 1999
The undersigned shareholder(s) of Powerwave Technologies, Inc. (the
"Company") hereby nominates, constitutes and appoints Bruce C. Edwards and
Kevin T. Michaels, and each of them, the attorney, agent and proxy of the
undersigned, with full power of substitution, to vote all stock of the Company
which the undersigned is entitled to vote at the Annual Meeting of Shareholders
of the Company to be held at the Orange County Airport Hilton, 18800 MacArthur
Boulevard, Irvine, California, 92612 on Monday, September 20, 1999 at 10:00
a.m., and any and all adjournments thereof, as fully with the same force and
effect as the undersigned might or could do if personally present thereat, as
follows:
1. Election of Directors. Authority to elect the seven (7) persons named in
the Notice of Annual Meeting dated August 13, 1999, to the Board of Directors
to serve until the next Annual Meeting of Shareholders or until their
successors are duly elected and qualified.
<TABLE>
<C> <S>
[_] FOR all Nominees listed below [_] WITHHOLD AUTHORITY to vote for all Nominees
(except as indicated to the contrary listed below
below)
</TABLE>
Gregory M. Avis, John L. Clendenin, Alfonso G. Cordero, Bruce C. Edwards, David
L. George, Eugene L. Goda, Andrew J. Sukawaty
Instruction: To withhold authority to vote for any individual Nominee,
write that Nominee's name in the space provided below.
-------------------
2. 1996 Stock Incentive Plan. To approve an amendment to the Company's 1996
Stock Incentive Plan to increase the number of shares of Common Stock issuable
thereunder from 3,000,000 to 5,000,000.
[_] FOR [_] AGAINST [_] ABSTAIN
3. Ratification of Appointment of Independent Auditors. To ratify the
appointment of Deloitte & Touche LLP as independent auditors.
[_] FOR [_] AGAINST [_] ABSTAIN
In their discretion, the proxies are authorized to transact such other
business as may properly come before the meeting or any adjournment or
postponement thereof, including procedural and other matters relating to the
conduct of the meeting.
<PAGE>
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND MAY BE REVOKED
PRIOR TO ITS EXERCISE.
PLEASE SIGN AND DATE BELOW, AND RETURN THIS CARD IN THE ENVELOPE PROVIDED.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSALS 1, 2 AND 3.
THE PROXY CONFERS AUTHORITY TO AND SHALL BE VOTED "FOR" THE ELECTION OF THE
SEVEN NOMINEES LISTED ON THE REVERSE SIDE AND "FOR" PROPOSALS 2 AND 3 UNLESS
OTHERWISE INDICATED, IN WHICH CASE THE PROXY SHALL BE VOTED IN ACCORDANCE WITH
SUCH INSTRUCTIONS.
-----------------------------------
(Number of Shares)
-----------------------------------
Dated
-----------------------------------
(Please Print Name)
-----------------------------------
(Signature of Shareholder)
-----------------------------------
(Please Print Name)
-----------------------------------
(Please date this Proxy and sign
your name as it appears on your
stock certificates. Executors,
administrators, trustees, etc.,
should give their full titles. All
joint owners should sign.)
I/We do do not expect to attend the Meeting. Number of Persons
