You are cordially invited to join us for our 2006 annual ... - Piper Jaffray

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y the subcommittee to grant such pre-approvals shall be presented to the full Committee at its nextscheduled meeting.V. Duties and Responsibilities The Committee shall:Oversee the Relationship with the Independent Auditor1. Appoint, determine the compensation and retention terms for, and oversee the work of anyindependent auditor engaged for the purpose of preparing or issuing an audit report orperforming other audit, review or attest services for the Company.2. Resolve disagreements between management and the independent auditor regarding financialreporting.3. At least annually, obtain and review a report by the independent auditor describing (a) itsinternal quality-control procedures, (b) any material issues raised by the most recent internalquality-control review, or peer review, of the firm, or by any inquiry or investigation bygovernmental or professional authorities, within the preceding five years, respecting one ormore independent audits carried out by the firm, and any steps taken to deal with any suchissues, and (c) all relationships between the independent auditor and the Company, in order toassess the auditor’s independence.4. Annually receive written notice from the independent auditor regarding its independence asrequired in Independence Standards Board Standard No. 1 and discuss with the independentauditor its independence.5. At least annually, evaluate the qualifications, performance and independence of theindependent auditor, considering (a) whether the auditor’s quality controls are adequate,(b) whether the provision of permitted non-audit services is compatible with maintaining theauditor’s independence, and (c) the opinions of the Company’s management and its internalauditor. The Committee shall present its conclusions with respect to the independent auditorto the Board.6. Review and evaluate the lead partner of the independent auditor team.7. Ensure the regular rotation of the lead audit partner having primary responsibility for theaudit and the audit partner responsible for reviewing the audit, as required by law.8. Review the Company’s hiring policies with respect to employees and former employees of theindependent auditor who participated in any capacity in the audit of the Company to ensuresuch hiring policies do not compromise the independence of the independent auditor.9. Confirm that none of the independent auditor’s audit partners earn or receive compensationbased on procuring engagements with the Company for providing products or services, otherthan audit review or attest services.10. Meet with the independent auditor prior to the audit to discuss the planning and staffing ofthe audit.11. Pre-approve all audit and permitted non-audit services (including the fees and terms thereof)to be performed for the Company by the independent auditor, subject to the de minimisexceptions for non-audit services described in Section 10A(i)(1)(B) of the Exchange Act thatare approved by the Committee prior to the completion of the audit, considering whether theprovision of any non-audit services is compatible with maintaining the independent auditor’sindependence.12. Discuss with the independent auditor issues on which the national office was consulted by theCompany’s audit team and matters of audit quality and consistency.Oversee the Integrity of the Company’s Financial Statements and Disclosures13. Meet to review and discuss with management and the independent auditor the Company’sannual audited financial statements, including reviewing the Company’s specific disclosuresA-2
under ‘‘Management’s Discussion and Analysis of Financial Condition and Results ofOperations,’’ and recommend to the Board whether the annual audited financial statementsshould be included in the Company’s Form 10-K.14. Meet to review and discuss with management and the independent auditor the Company’squarterly financial statements, including reviewing the Company’s specific disclosures under‘‘Management’s Discussion and Analysis of Financial Condition and Results of Operations,’’prior to the filing of the Company’s Form 10-Q.15. Discuss with management and the independent auditor significant financial reporting issuesand judgments made in connection with the preparation of the Company’s financialstatements, including any significant changes in the Company’s selection or application ofaccounting principles.16. Review and discuss with management and the independent auditor any major issues as to theadequacy of the Company’s internal controls, any special steps adopted in light of materialcontrol deficiencies and the adequacy of disclosures about changes in internal control overfinancial reporting.17. Review and discuss with management (including the senior internal audit executive) and theindependent auditor the Company’s internal controls report and the independent auditor’sattestation of the report, prior to the filing of the Company’s Form 10-K.18. Review and discuss with the independent auditor (a) all critical accounting policies andpractices to be used; (b) all alternative treatments of financial information within generallyaccepted accounting principles (‘‘GAAP’’) that have been discussed with management,ramifications of the use of such alternative disclosures and treatments, and the treatmentpreferred by the independent auditor; and (c) other material written communications betweenthe independent auditor and management, such as any management letter or schedule ofunadjusted differences.19. Discuss generally with management the types of information to be disclosed and the types ofpresentations to be made with respect to the Company’s earnings press releases, including theuse of ‘‘pro forma’’ or ‘‘adjusted’’ non-GAAP information, and any financial information andearnings guidance provided to analysts and rating agencies.20. Discuss with management and the independent auditor the effect of regulatory and accountinginitiatives, as well as off-balance sheet structures, on the Company’s financial statements.21. Review disclosures made to the Committee by the Company’s chief executive officer and chieffinancial officer during their certification process for the Form 10-K and Forms 10-Q aboutany significant deficiencies in the design or operation of internal controls or materialweaknesses therein and any fraud involving management or other employees who play asignificant role in the Company’s internal controls.22. Discuss with the independent auditor the matters required to be discussed by Statement onAuditing Standards No. 61 relating to the conduct of the audit, and review with theindependent auditor any difficulties encountered in the course of the audit work, includingany restrictions on the scope of the independent auditor’s activities or on its access torequested information, and any significant disagreements with management, and management’sresponse to such problems or difficulties.Oversee the Company’s Internal Audit Function23. Review the appointment and replacement of the senior internal audit executive.24. Review the significant reports to management prepared by the internal auditor andmanagement’s responses.25. Discuss with the independent auditor and management the responsibilities, budget and staffingof the Company’s internal audit function and the planned scope of the internal audit.A-3
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Page 5 and 6: PROXY STATEMENT2006 ANNUAL MEETING
Page 7 and 8: What does it mean if I receive more
Page 9 and 10: espect to which you abstained from
Page 11 and 12: CLASS I DIRECTORS — TERMS ENDING
Page 13 and 14: ) Has authority to call meetings of
Page 15 and 16: shareholder meetings must timely pr
Page 17 and 18: (3)(4)Each non-employee director ex
Page 19 and 20: Annual Incentive CompensationThe an
Page 21 and 22: strategic initiatives. His annual i
Page 23 and 24: (6)respectively; for Mr. Peterson,
Page 25 and 26: compensation program. The cash awar
Page 27 and 28: STOCK PERFORMANCE GRAPHThe followin
Page 29 and 30: The Board of Directors recommends t
Page 31 and 32: waive in whole or in part any or al
Page 33 and 34: obligations under the plan are cond
Page 35 and 36: Beneficial Ownership of Directors,
Page 37 and 38: (2)(3)This information is based on
Page 39 and 40: Auditor FeesErnst & Young LLP serve
Page 41 and 42: ‘‘If you believe that one-year
Page 43: APPENDIX AI. PurposePIPER JAFFRAY C
Page 47 and 48: APPENDIX BSECTION 1. PurposePIPER J
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Page 51 and 52: shares subject to outstanding Stock
Page 53 and 54: (d) Performance Awards. The Committ
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Page 57 and 58: SECTION 10. General Provisions(a) N
Page 59 and 60: SECTION 11. Effective Date of PlanU

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