10.25
SUBSCRIPTION AGREEMENT
----------------------
This Subscription Agreement is executed by ParkerVision, Inc., a Florida
corporation, with an office at 0000 Xxxxxxxxxx Xxx, Xxxxxxxxxxxx, Xxxxxxx 00000
(hereinafter referred to as the "ISSUER") and Xxxxxxx X. Xxxxxx, with an office
at the address on the signature page hereof (hereinafter referred to as the
("SUBSCRIBER") in reliance upon the exemption contained in Section 4(2) of the
Securities Act of 1933, as amended ("Securities Act").
This Subscription Agreement has been entered into for the sale of the
number of shares of the Issuer's Common Stock, $.01 par value ("Common Stock"),
determined by the formula set forth in Section 1.a (hereinafter referred to as
the "Shares").
The parties hereto hereby agree as follows:
1. AGREEMENT TO SUBSCRIBE; SUBSCRIPTION PRICE.
a. SUBSCRIBER hereby subscribes for 247,525 Shares, and ISSUER
agrees to sell such Shares, for an aggregate purchase price of
$1,250,000 ("Purchase Price"), that number of Shares (rounded up
to the nearest whole number of shares) being equal to $1,250,000
divided by the quotient obtained by dividing (y) the sum of the
closing bid prices of the Common Stock of the ISSUER for the five
consecutive trading days ending the trading day immediately prior
to the date of this Subscription Agreement, as such prices are
reported by The Nasdaq Stock Market, Inc., by (z) five.
b. FORM OF PAYMENT. On the Closing Date, as defined below,
SUBSCRIBER shall pay the Purchase Price for the Shares purchased
hereunder by wire transfer of same day funds in United States
Dollars to the depository designated by the ISSUER, payable to
the order of ISSUER. ISSUER shall deliver one or more
certificates representing the Shares to the Subscriber promptly
after the Closing Date.
2. SUBSCRIBER REPRESENTATIONS.
a. TRANSACTIONAL REPRESENTATIONS. SUBSCRIBER represents and warrants
to ISSUER as follows:
(i) SUBSCRIBER is purchasing the Shares for its own account for
investment purposes and not with a view toward
distribution.
(ii) SUBSCRIBER understands that the Shares have not been
registered under the Securities Act and that such
securities are "restricted securities" as defined in Rule
144 promulgated under the Securities Act. SUBSCRIBER
further understands that the Shares may not be offered,
resold, pledged or otherwise transferred by such
SUBSCRIBER except: A) (1) pursuant to an effective
registration statement under the Securities Act, or (2)
pursuant to an available exemption from the registration
requirements of the Securities Act; and B) in accordance
with all applicable securities laws of the states of the
United States and other jurisdictions;
(iii) SUBSCRIBER understands that the purchase of the Shares
involves a high degree of risk and further acknowledges
that it can bear the economic risk of the purchase of the
securities, including the total loss of its investment;
(iv) SUBSCRIBER understands that the Shares are being offered
and sold to it in reliance on specific exemptions from the
registration requirements of federal and state securities
laws and that the ISSUER is relying upon the truth and
accuracy of the representations, warranties, agreements,
acknowledgments and understandings of SUBSCRIBER set forth
herein in order to determine the applicability of such
exemptions and the suitability of SUBSCRIBER to acquire the
securities;
(v) SUBSCRIBER is sufficiently experienced in financial and
business matters to be capable of evaluating the merits and
risks of its investment, and to make an informed decision
relating thereto; and
(vi) In evaluating its investment, SUBSCRIBER has consulted its
own investment and/or legal and/or tax advisors.
b. CURRENT PUBLIC INFORMATION. SUBSCRIBER acknowledges that
SUBSCRIBER has been furnished with or has otherwise acquired
copies of the ISSUER's Annual Report on Form 10-K for the year
ended December 31, 2001, and Form 10-Q for the quarters ended
March 31, 2002, June 30, 2002, and September 30, 2002, all as
filed with the Securities and Exchange Commission (the "SEC") and
the ISSUER's press release dated March 21, 2003 setting forth the
year end results as of December 31, 2002. SUBSCRIBER further
acknowledges that SUBSCRIBER has read and understands the Risk
Factors set forth in Exhibit 99.1 to the ISSUER's Form 10-Q for
the quarter ended September 30, 2002.
c. INDEPENDENT INVESTIGATION; ACCESS. SUBSCRIBER acknowledges that,
in making its decision to purchase the Shares subscribed for, it
has relied on the publicly available information about the ISSUER
and upon independent investigations made by it and its
representatives, if any. SUBSCRIBER and such representatives, if
any, prior to the sale to it of the securities offered hereby,
have been given access to, and the opportunity to examine, all
material books and records of the ISSUER, all material contracts
and documents relating to the ISSUER and this
2
offering and an opportunity to ask questions of, and to receive
answers from, executive officers of ISSUER concerning the ISSUER
and the terms and conditions of this offering. SUBSCRIBER and its
advisors, if any, acknowledge that they have received answers to
any such inquiries and copies of documentary information
requested.
d. NO GOVERNMENT RECOMMENDATION OR APPROVAL. SUBSCRIBER understands
that no federal or state agency has passed on or made any finding
or determination relating to the fairness of an investment in the
Shares, or has passed or made, or will pass on or make, any
recommendation or endorsement of the Shares.
3. ISSUER REPRESENTATIONS.
a. AUTHORITY; CORPORATE ACTION. ISSUER has all necessary corporate
power and authority to enter into this Subscription Agreement and
to consummate the transactions contemplated hereby. All corporate
action necessary to be taken by ISSUER to authorize the
execution, delivery and performance of this Subscription
Agreement, and all other agreements and instruments delivered by
ISSUER in connection with the transactions contemplated hereby
has been duly and validly taken and this Subscription Agreement
has been duly executed and delivered by ISSUER. This Subscription
Agreement constitutes the legal, valid and binding obligation of
ISSUER, and is enforceable in accordance with its terms, except
as enforceability may be limited by (i) applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or
similar laws of general application now or hereafter in effect
affecting the rights and remedies of creditors and by general
principles of equity (regardless of whether enforcement is sought
in a proceeding at law or in equity); and (ii) the applicability
of the federal and state securities laws and public policy as to
the enforceability of the indemnification provisions of Section 7
hereof. The sale by the ISSUER of the Shares does not conflict
with the certificate of incorporation or by-laws of the ISSUER,
or any material contract by which the ISSUER or its property is
bound, or any federal or state laws or regulations or decree,
ruling or judgment of any United States or state court applicable
to the ISSUER or its property.
b. PARKERVISION CAPITALIZATION. The ISSUER is authorized to issue
100,000,000 shares of Common Stock, and 5,000,000 shares of
preferred stock, of which, as of the Closing Date after giving
effect to the transactions contemplated by this Subscription
Agreement and the simultaneous sale of shares of Common Stock to
Xxxxxxx Xxxxxx and his affiliates/relatives as referenced herein
15,244,532 shares of Common Stock and no shares of preferred
stock will have been issued and outstanding.
3
c. PARKERVISION SHARES. The shares of Common Stock issued to
SUBSCRIBER pursuant to this Subscription Agreement are duly
authorized, validly issued, fully paid and non-assessable.
d. RULE 144 REQUIREMENTS. ISSUER agrees to use commercially
reasonable efforts:
(i) to make and keep public information available, as those
terms are understood and defined in Rule 144 under the
Securities Act;
(ii) to file with the SEC in a timely manner all reports and
other documents required of ISSUER under the Securities Act
and the Securities Exchange Act of 1934, as amended (the
"Exchange Act"); and
(iii) to furnish to SUBSCRIBER upon request a written statement
by ISSUER as to its compliance with the reporting
requirements of said Rule 144, and of the Securities Act
and the Exchange Act, a copy of the most recent annual or
quarterly report of ISSUER, and such other reports and
documents of ISSUER as SUBSCRIBER may reasonably request to
avail itself of any similar rule or regulation of the SEC
allowing it to sell any such securities without
registration.
e. SEC DOCUMENTS. ISSUER's Common Stock is registered pursuant to
Section 12(g) of the Exchange Act. Since January 1, 1999, the
ISSUER has timely filed with the SEC all reports, schedules,
forms, statements and other documents required to be filed (such
reports, schedules, forms, statements and other documents are
hereinafter referred to as the "SEC Documents"). As of their
respective dates, the SEC Documents complied in all material
respects with the requirements of the Securities Act or the
Exchange Act, as the case may be, and the rules and regulations
of the SEC promulgated thereunder applicable to such SEC
Documents, and none of the SEC Documents as of such dates
contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The
financial statements of the ISSUER included in the SEC Documents
(the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto,
have been prepared in accordance with GAAP applied on a
consistent basis during the periods involved (except in the case
of unaudited statements, as permitted by Rule 10-01 of Regulation
S-X) and fairly present, in all material respects, the financial
position of the ISSUER as of the dates thereof and the results of
operations and cash flows for the periods then ended (on the
basis stated therein and subject, in the case of unaudited
quarterly
4
statements, to the absence of complete notes and to normal
year-end audit adjustments). Except as disclosed in the March 21,
2003 press release of the ISSUER, since September 30, 2002, there
has been no material adverse change in the assets, business or
condition (financial or otherwise), or results of operations of
the ISSUER. Since September 30, 2002, there have been no events
relating to the business or financial condition of the ISSUER
that requires the filing of a Report on Form 8-K by the ISSUER.
f. GENERAL DOCUMENT REPRESENTATION. The written materials of the
ISSUER previously delivered to SUBSCRIBER in connection with this
Subscription Agreement, at the time they were given to
SUBSCRIBER, were true and accurate in all material respects.
4. REPRESENTATIONS AND WARRANTIES MADE AT CLOSING; INDEMNIFICATION. Each
party making the representations and warranties contained in Sections 2 and 3
also represents and warrants that they shall be true and accurate as of the
Closing Date. If either party has knowledge, prior to the Closing Date that any
such representations and warranties made by it shall not be true and accurate in
any respect, such party will give written notice of such fact to the other party
specifying which representations and warranties are not true and accurate and
the reasons therefor.
Each party to this Subscription Agreement agrees to fully indemnify, defend
and hold harmless the other party, its officers, directors, employees, agents
and attorneys from and against any and all losses, claims, damages, liabilities
and expenses, including reasonable attorneys' fees and expenses, which may
result from a breach of such party's representations, warranties and covenants
contained herein.
5. LEGEND. SUBSCRIBER understands that the ISSUER will instruct its
transfer agent to place a stop transfer order with respect to the certificates
representing the Shares and that such certificates will bear the following
legend, as well as a legend describing the restriction referred to in the last
sentence of Section 7(a) hereof: "The shares represented by this certificate
have been acquired for investment and have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"). Transfer of these
shares is prohibited except pursuant to registration under the Securities Act or
pursuant to an available exemption from registration."
6. CLOSING DATE. The date of issuance and sale of the Shares ("Closing
Date") shall be on such date as may be mutually agreed to, but not later than
March 31, 2003.
7. REGISTRATION RIGHT.
a. REGISTRATION. The ISSUER shall file a registration statement
under the Securities Act ("Registration Statement") with the
Securities and Exchange Commission registering the Shares for
re-offer and re-sale. The ISSUER agrees to have the Registration
Statement declared effective six months after the Closing Date
("Anniversary"). Once the Registration Statement is declared
effective, the ISSUER shall keep the Registration Statement
effective and current until all the securities registered
thereunder
5
are sold or may be sold freely in any 90 day period without
registration under an appropriate exemption under the Securities
Act. If the Registration Statement has not been declared
effective by the Anniversary or, if it is so declared effective
but after the Anniversary becomes subject to a stop order or is
not otherwise current for use by SUBSCRIBER, then during such
periods, the SUBSCRIBER may demand on no more than an aggregate
of three separate occasions to have its Shares registered on a
registration statement filed with the Securities and Exchange
Commission or have such securities included on any other
applicable registration statement filed by ISSUER, which "demand"
and "piggyback" registration rights will be subject to such
reasonable terms as are ordinarily offered to investors
purchasing similar securities to those purchased under this
Subscription Agreement.
b. TERMS. The ISSUER shall bear all of its fees and expenses
attendant to registering the Shares, but SUBSCRIBER shall pay any
and all underwriting commissions and the expenses of any legal
counsel selected by SUBSCRIBER to represent it in connection with
the registration or sale of the Shares. Promptly upon request,
ISSUER will provide to SUBSCRIBER such number of copies of the
prospectus forming a part of the Registration Statement as are
reasonably requested by the SUBSCRIBER, and all supplements to
such prospectus. ISSUER will promptly notify SUBSCRIBER at any
time that the Registration Statement or the prospectus may not be
used either due to the change of material information contained
therein or the omission of material information therefrom or upon
the receipt by the ISSUER of a cease and desist or stop order of
the Securities and Exchange Commission. The ISSUER will use its
commercially reasonably efforts to amend or supplement the
Registration Statement to permit its continued use by the
SUBSCRIBER.
c. INDEMNIFICATION BY THE ISSUER. The ISSUER agrees to indemnify and
hold harmless SUBSCRIBER, its directors and officers and each
person, if any, who controls SUBSCRIBER within the meaning of the
Securities Act and/or the Securities Exchange Act of 1934, as
amended ("Exchange Act"), against any losses, claims, damages or
liabilities, joint or several, to which SUBSCRIBER or such person
may become subject, under the Securities Act, Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of a
material fact contained (A) in any prospectus or registration
statement for the Shares or (B) in any blue sky application or
other document executed by the ISSUER specifically for blue sky
purposes or based upon any other written information furnished by
the ISSUER or on its behalf to any state or other jurisdiction in
order to qualify any or all of the Shares under the securities
laws thereof (any such application, document or information being
hereinafter called a "Blue Sky Application"),
6
or (ii) the omission or alleged omission by the ISSUER to state
in any prospectus or registration statement for the Shares or in
any Blue Sky Application a material fact required to be stated
therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, and
will reimburse SUBSCRIBER and each such person for any legal or
other expenses reasonably incurred by SUBSCRIBER or such person
in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the
ISSUER will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission
or alleged omission made in reliance upon and in conformity with
information regarding SUBSCRIBER which is furnished in writing to
the ISSUER by SUBSCRIBER or its representatives for inclusion in
any registration statement for the Shares or any such Blue Sky
Application ("Non-Indemnity Events").
d. INDEMNIFICATION BY THE SUBSCRIBER. The SUBSCRIBER agrees to
indemnify and hold harmless the ISSUER, each officer and director
of the ISSUER, and each person, if any, who controls the ISSUER
within the meaning of the Securities Act and/or the Exchange Act
against any losses, claims, damages or liabilities, joint or
several, to which the ISSUER or such person may become subject,
under the Securities Act, Exchange Act or otherwise insofar as
such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any Non-Indemnity
Event; and will reimburse the ISSUER and such persons for any
legal or other expenses reasonably incurred by the ISSUER in
connection with investigating or defending any such loss, claim,
damage, liability or action provided that such loss, claim,
damage or liability is found ultimately to arise out of or be
based upon any Non-Indemnity Event; provided that the maximum
amount of the indemnification payments by SUBSCRIBER shall not
exceed the net sale proceeds of any of the Shares sold by the
SUBSCRIBER pursuant to the registration statement.
e. PROCEDURE. Promptly after receipt by an indemnified party under
this Section 7 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be
made against any indemnifying party under this Section 7, notify
in writing the indemnifying party of the commencement thereof;
and the omission so to notify the indemnifying party will relieve
the indemnifying party from any liability under this Section 7 as
to the particular item for which indemnification is then being
sought (if such failure materially prejudices the indemnifying
party), but not from any other liability which it may have to any
indemnified party. In case any such action is brought against any
indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein, and to the extent that it may wish, jointly
with any other indemnifying party, similarly notified, to assume
the defense
7
thereof, with counsel who shall be to the reasonable satisfaction
of such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to
such indemnified party under this Section 7 for any legal or
other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs
of investigation. Any such indemnifying party shall not be liable
to any such indemnified party on account of any settlement of any
claim or action effected without the consent of such indemnifying
party, which consent shall not be unreasonably withheld. No
indemnifying party shall, without the consent of the indemnified
party, consent to entry of any judgment or enter into any
settlement of any such action unless (i) there is no finding or
admission of any violation or wrongdoing, and (ii) such judgment
or settlement includes as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of
a release from all liability, or a covenant not to xxx, in
respect to such claim or litigation.
f. CONTRIBUTION. If the indemnification provided for in this Section
7 is unavailable to any indemnified party in respect to any
losses, claims, damages, liabilities or expenses referred to
therein, then the indemnifying party, in lieu of indemnifying
such indemnified party, will contribute to the amount paid or
payable by such indemnified party, as a result of such losses,
claims, damages, liabilities or expenses in such proportion as is
appropriate to reflect the relative fault of the ISSUER on the
one hand, and of the SUBSCRIBER on the other hand, in connection
with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses as well as any other
relevant equitable considerations. The relative fault of the
ISSUER on the one hand, and the SUBSCRIBER on the other hand,
will be determined with reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied
by the ISSUER, and its relative intent, knowledge, access to
information and opportunity to correct or prevent such statement
or omission.
g. EQUITABLE CONSIDERATIONS. The ISSUER and the SUBSCRIBER agree
that it would not be just and equitable if contribution pursuant
to this Section 7 were determined by pro rata allocation or by
any other method of allocation which does not take into account
the equitable considerations referred to in the immediately
preceding paragraph.
h. ATTORNEYS' FEES. The amount payable by a party under this Section
7 as a result of the losses, claims, damages, liabilities or
expenses referred to above will be deemed to include any legal or
other fees or expenses reasonably incurred by such party in
connection with investigating or defending any action or claim
8
(including, without limitation, fees and disbursements of counsel
incurred by an indemnified party in any action or proceeding
between the indemnifying party and indemnified party or between
the indemnified party and any third party or otherwise).
i. DOCUMENTS TO BE DELIVERED BY SUBSCRIBER. SUBSCRIBER shall furnish
to the ISSUER a completed and executed questionnaire provided by
the ISSUER requesting information customarily sought of selling
security holders.
8. DISCLOSURE. Neither the ISSUER nor the SUBSCRIBER will disclose the
terms of this Subscription Agreement without the written consent of the other
party hereto, unless required by law or regulation or judicial action. The
SUBSCRIBER agrees that ISSUER may issue a press release in the form attached as
Exhibit A hereto and provide substantially similar disclosure about this
transaction in its Exchange Act Reports and other documents filed with the
Securities and Exchange Commission.
9. GOVERNING LAW. This Subscription Agreement shall be governed by and
interpreted in accordance with the rulings of the laws of the State of Florida
without regard to conflicts of law. The ISSUER and SUBSCRIBER each hereby agrees
that any action, proceeding or claim against it arising out of, or relating in
any way to this agreement shall be brought and enforced in the courts of the
State of Florida or of the United States of America for the Middle District of
Florida, Jacksonville Division and irrevocably submits to such jurisdiction,
which jurisdiction shall be exclusive. The ISSUER and SUBSCRIBER hereby waives
any objection to such exclusive jurisdiction and that such courts represent an
inconvenient forum. Any process or summons to be served upon the ISSUER and
SUBSCRIBER may be served by transmitting a copy thereof by registered or
certified mail, return receipt requested, postage prepaid, addressed to it at
its address set forth herein. Such mailing shall be deemed personal service and
shall be legal and binding upon the ISSUER and SUBSCRIBER in any action,
proceeding or claim. The ISSUER and SUBSCRIBER agrees that the prevailing
party(ies) in any such action shall be entitled to recover from the other
party(ies) all of its reasonable attorneys' fees and expenses relating to such
action or proceeding and/or incurred in connection with the preparation
therefor.
10. ENTIRE AGREEMENT. This Subscription Agreement and the Purchase Option
constitutes the entire agreement among the parties hereof with respect to the
subject matter hereof and supersedes any and all prior or contemporaneous
representations, warrants, agreements and understandings in connection
therewith. This Subscription Agreement may be amended only by a writing executed
by all parties hereto.
11. NOTICES. Any notice or other document required or permitted to be given
or delivered to the parties to this Subscription Agreement shall be personally
delivered or sent by facsimile or other form of electronic transmission to the
party at the address or addresses or telecopier number on the signature page
hereto. Unless otherwise specified in this agreement, all notices and other
documents given under this agreement shall be deemed to have been duly given
when delivered, if personally delivered, and when transmitted if sent by
facsimile or other form of electronic transmission.
9
IN WITNESS WHEREOF, this Subscription Agreement was duly executed on the
date first written below.
Dated this 26th day of the month of March, 2003.
XXXXXXX X. XXXXXX PARKERVISION, INC.
By: /s/Xxxxxxx X. Xxxxxx By: /s/Xxxxxxx X. Xxxxxxxx
-------------------- ----------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Chief Accounting Officer
Notice Addresses: Chief Financial Officer
____________________________ ParkerVision, Inc.
____________________________ 0000 Xxxxxxxxxx Xxx
____________________________ Xxxxxxxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
with a copy to
Xxxxx Xxxx Xxxxxx, Esq.
Xxxxxxxx Xxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile (000) 000-0000
10
