UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 6-K
Report of Foreign issuer
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
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For the Month of April 2004
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(Commission File. No 0-30718).
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SIERRA WIRELESS, INC., A CANADA CORPORATION
-------------------------------------------
(Translation of registrant's name in English)
13811 Wireless Way
Richmond, British Columbia, Canada V6V 3A4
------------------------------------------
(Address of principal executive offices and zip code)
Registrant's Telephone Number, including area code: 604-231-1100
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Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F: Form 20-F ____ 40-F X
---
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
Yes: ____ No: X
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SIERRA WIRELESS, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that an annual meeting (the "Meeting") of shareholders of
Sierra Wireless, Inc. (the "Corporation") will be held at the office of Sierra
Wireless, Inc., Richmond, British Columbia, on Monday, April 26, 2004 at 2:00
p.m. (Vancouver time) for the following purposes:
1. To receive the report of the directors;
2. To receive the consolidated financial statements for the year ended
December 31, 2003 and the auditors' report thereon;
3. To appoint KPMG LLP, Chartered Accountants, as auditors of the
Corporation and to authorize the directors to fix the auditors'
remuneration;
4. To elect directors for the ensuing year; and
5. To transact such other business as may be properly brought before the
Meeting.
Further details of the above matters are set out in the attached Information
Circular.
DATED at Richmond, British Columbia, this 24th day of March, 2004.
By Order of the Board of Directors
"David G. McLennan"
----------------------------------
David G. McLennan,
Chief Financial Officer and Secretary
IMPORTANT
Only holders of common shares of the Corporation of record at the close of
business on March 24, 2004 are entitled to notice of the Meeting and only those
holders of common shares of the Corporation of record at the close of business
on March 24, 2004, or who subsequently become shareholders and comply with the
provisions of the CANADA BUSINESS CORPORATIONS ACT, are entitled to vote at the
Meeting. Shareholders who are unable to attend the Meeting in person are
requested to complete, sign, date and mail the enclosed form of proxy in
accordance with the instructions set out in the proxy and in the Information
Circular accompanying this Notice.
Proxies, to be valid, must be deposited at the office of the registrar and
transfer agent of the Corporation, Computershare Trust Company of Canada, 9th
Floor, 100 University Avenue, Toronto, Ontario, M5J 2Y1, not less than 48 hours
(excluding Saturdays, Sundays, and statutory holidays) preceding the Meeting or
any adjournment of the Meeting.
SIERRA WIRELESS, INC.
13811 Wireless Way
Richmond, British Columbia Canada V6V 3A4
INFORMATION CIRCULAR
As at March 24, 2004
GENERAL PROXY INFORMATION
SOLICITATION OF PROXIES
This Information Circular is furnished in connection with the solicitation of
proxies by the management (the "Management") of Sierra Wireless, Inc. (the
"Corporation") for use at the annual meeting (the "Meeting") of shareholders of
the Corporation (and any adjournment thereof) to be held on Monday, April 26,
2004 at the time and place and for the purposes set forth in the accompanying
Notice of Meeting. While it is expected that the solicitation will be primarily
by mail, proxies may be solicited personally or by telephone by the directors
and regular employees of the Corporation. All costs of solicitation will be
borne by the Corporation.
APPOINTMENT OF PROXYHOLDER
The individuals named in the accompanying form of proxy are the Chief Executive
Officer (or "CEO") and Chief Financial Officer of the Corporation. A SHAREHOLDER
MAY APPOINT SOME OTHER PERSON (WHO NEED NOT BE A SHAREHOLDER) TO ATTEND AND ACT
ON THE SHAREHOLDER'S BEHALF AT THE MEETING. TO EXERCISE THIS RIGHT, THE
SHAREHOLDER MAY EITHER INSERT THE NAME OF SUCH OTHER PERSON IN THE BLANK SPACE
PROVIDED IN THE FORM OF PROXY OR COMPLETE AND SUBMIT ANOTHER FORM OF PROXY.
A proxy will not be valid unless the completed form of proxy is received by the
Corporation at the offices of the Corporation's registrar and transfer agent,
Computershare Trust Company of Canada, at 9th Floor, 100 University Avenue,
Toronto, Ontario, M5J 2Y1 (fax: 1.866.249.7775), not later than 48 hours
(excluding Saturdays, Sundays and statutory holidays) before the time for
holding the Meeting or any adjournment thereof.
REVOCATION OF PROXY
A shareholder may revoke a proxy by delivering an instrument in writing executed
by the shareholder or the shareholder's attorney authorized in writing or, where
the shareholder is a corporation, by a duly authorized officer or attorney for
the corporation, either to the registered office of the Corporation at Suite
2600, Three Bentall Centre, 595 Burrard Street, P.O. Box 49314, Vancouver,
British Columbia, V7X 1L3, at any time up to and including 48 hours preceding
the Meeting, or if adjourned, any reconvening thereof, or to the Chairman of the
Meeting on the day of the Meeting before any vote in respect of which the proxy
is to be used shall have been taken or in any other manner provided by law.
A revocation does not affect any matter on which a vote has been taken prior to
the revocation. A shareholder of the Corporation may also revoke a proxy by
signing a form of proxy bearing a later date and returning such proxy and
delivering it to Computershare Trust Company of Canada as aforesaid at any time
up to and including 48 hours preceding the Meeting or any adjournment thereof.
A person duly appointed under a form of proxy will be entitled to vote the
shares represented thereby only if the form of proxy is properly completed and
delivered in accordance with the requirements set out above under the heading
"Appointment of Proxyholder" and such proxy has not been revoked.
- 2 -
VOTING OF PROXIES AND DISCRETIONARY AUTHORITY
Unless specifically directed in the form of proxy to withhold the shares
represented by the form of proxy from a ballot or show of hands, the proxies
named in the accompanying form of proxy shall vote the shares represented by the
form of proxy on each ballot or show of hands. Where a choice with respect to
any matter to be acted upon has been specified in the form of proxy, the shares
will be voted in accordance with the specifications so made.
IN THE ABSENCE OF ANY INSTRUCTIONS ON THE PROXY OR IF SUCH INSTRUCTIONS ARE
UNCLEAR, SHARES REPRESENTED BY THE FORM OF PROXY WILL BE VOTED:
1. FOR THE APPOINTMENT OF KPMG LLP, CHARTERED ACCOUNTANTS, AS AUDITORS OF
THE CORPORATION AND AUTHORIZING THE DIRECTORS TO FIX THE AUDITORS'
REMUNERATION; AND
2. FOR THE ELECTION OF THE INDIVIDUALS LISTED IN THE PROXY AS DIRECTORS
OF THE CORPORATION,
in each case as more particularly described elsewhere in this Information
Circular.
The enclosed form of proxy when properly completed and delivered and not revoked
confers discretionary authority upon the person appointed proxy thereunder to
vote with respect to amendments or variations of matters identified in the
Notice of Meeting, and with respect to other matters which may properly come
before the Meeting. In the event that amendments or variations to matters
identified in the Notice of Meeting are properly brought before the Meeting or
any further or other matter of business is properly brought before the Meeting,
it is the intention of the persons designated in the enclosed form of proxy to
vote in accordance with their best judgement on such matter of business. At the
time of the printing of this Information Circular, Management knows of no such
amendment, variation or other matter which may be presented at the Meeting.
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
Other than as disclosed in this Information Circular, no director or senior
officer, past, present or nominated, or any associate or affiliate of such
persons, or any person on behalf of whom this solicitation is made, has any
interest, direct or indirect, in any matter to be acted upon at the Meeting,
except to the extent that such persons may be directly involved in the normal
business of the Meeting or the general affairs of the Corporation.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The Corporation is authorized to issue an unlimited number of common shares in
the capital of the Corporation ("Common Shares") of which, as of the date of
this Information Circular, 25,147,231 Common Shares are issued and outstanding
as fully paid and non-assessable shares. The holders of Common Shares are
entitled to one (1) vote for each Common Share held. The Corporation is also
authorized to issue an unlimited number of preference shares issuable in series,
of which none are issued and outstanding.
Any shareholder of record at the close of business on March 24, 2004 (the
"Record Date") who either personally attends the Meeting or who has completed
and delivered a form of proxy in the manner and subject to the provisions
described above shall be entitled to vote or have his Common Shares voted at the
Meeting.
- 3 -
MATTERS TO BE ACTED UPON AT THE MEETING
APPOINTMENT OF AUDITORS
Management will recommend that the Meeting appoint KPMG LLP, Chartered
Accountants, as auditors of the Corporation and authorize the directors to fix
their remuneration.
ELECTION OF DIRECTORS
The term of office of each of the present directors expires at the Meeting. The
Board of Directors presently consists of seven (7) directors and it is intended
to elect seven (7) directors for the ensuing year. Each director elected will
hold office until the next annual meeting of the Corporation or until his or her
successor is elected or appointed, unless his or her office is earlier vacated,
in accordance with the By-laws of the Corporation or with the provisions of the
CANADA BUSINESS CORPORATIONS ACT.
The persons named below will be presented for election at the Meeting as
Management's nominees for the Board of Directors, and the proxyholders named in
the accompanying form of proxy intend to vote for the election of these
nominees. Management does not contemplate presenting for election any person
other than these nominees but, if for any reason Management does present another
nominee for election, the proxyholders named in the accompanying form of proxy
reserve the right to vote for such other nominee in their discretion unless the
shareholder has specified otherwise in the form of proxy.
The following table sets out the names of the nominees for election as
directors, the municipality in which each is ordinarily resident, all offices of
the Corporation now held by each of them, their present principal occupations,
their principal occupation within the five preceding years and, unless he or she
is now a director and was elected to his or her present term at the last annual
meeting of the Corporation, the period of time for which each has been a
director of the Corporation, and the number of Common Shares beneficially owned
by each, directly or indirectly, or over which each exercises control or
direction, as at the date hereof.
NO. OF
NAME, POSITION AND RESIDENCE PRINCIPAL OCCUPATION OR EMPLOYMENT DIRECTOR SINCE COMMON SHARES
------------------------------------- ------------------------------------------------- ----------------- --------------
DAVID B. SUTCLIFFE Chairman and Chief Executive Officer June 1995 180,542 (1)
Chairman, CEO and Director
North Vancouver,
British Columbia
GREGORY D. AASEN(b) Chief Operating Officer of PMC-Sierra, Ltd., a December 1997 20,000 (2)
Director wholly-owned subsidiary of PMC-Sierra, Inc.
West Vancouver,
British Columbia
S. JANE ROWE(a) Senior Vice President, Global Risk Management March 1998 50,156(3)
Director Division of Scotiabank from 2002 to present;
Toronto, Ontario Managing Director and Co-Head of Scotia
Merchant Capital Corporation from 1997 to 2002
- 4 -
NO. OF
NAME, POSITION AND RESIDENCE PRINCIPAL OCCUPATION OR EMPLOYMENT DIRECTOR SINCE COMMON SHARES
------------------------------------- ------------------------------------------------- ----------------- --------------
PAUL G. CATAFORD(a) (c) Managing Partner of HorizonOne Asset Management July 1998 2,675(4)
Director from December 2002 to present; Consultant from
Toronto, Ontario March 2002 to December 2002; Executive Managing
Director of BMO Nesbitt Burns Equity Partners
Inc. from 2001 to 2002; Managing Director and
President BCE Capital Inc. from 1997 to 2001
PETER CICERI(c) Executive in residence at the Faculty of February 2000 5,500 (5)
Lead Independent Director Commerce and Business Administration at the
Whistler, British Columbia University of British Columbia from September
2001 to present; President of Rogers Telecom,
Inc. from 2000 to May 2001; President and
Managing Director of Compaq Canada Ltd. and
Vice-President Compaq Computer Corporation (US)
from 1996 to 2000
NADIR MOHAMED(a) President, Chief Executive Officer and Director March 2003 Nil (6)
Director of Rogers Wireless Communications Inc.from
Toronto, Ontario 2001 to present; President and Chief Operating
Officer of Rogers Wireless Communications Inc.
from 2000 to 2001; Senior Vice President,
Marketing and Sales of Telus Communications
Inc. from 1999 to 2000; President and Chief
Operating Officer of BC Tel Mobility from 1997
to 1999
CHARLES E. LEVINE(b) Retired. President and Chief Operating Officer May 2003 Nil (7)
Director of Sprint PCS from 2000 to 2002; Chief Sales
San Francisco, California and Marketing Officer from 1997 to 2000.
------------------------------
NOTES:
(a) Member of the Audit Committee.
(b) Member of the Human Resources Committee.
(c) Member of the Governance and Nominating Committee.
(1) Excludes options to purchase an aggregate of 183,111 Common Shares at
prices ranging from Cdn.$3.38 per Common Share to Cdn.$34.11 per Common
Share.
(2) Excludes options to purchase an aggregate of 15,000 Common Shares at
prices ranging from Cdn.$3.50 per Common Share to Cdn.$34.11 per Common
Share.
(3) Excludes options to purchase an aggregate of 15,000 Common Shares at
prices ranging from Cdn.$3.50 per Common Share to Cdn. $34.11 per
Common Share.
(4) Excludes options to purchase an aggregate of 19,125 Common Shares at
prices ranging from Cdn.$3.50 per Common Share to Cdn.$34.11 per Common
Share.
(5) Excludes options to purchase an aggregate of 46,250 Common Shares at
prices ranging from Cdn.$3.50 per Common Share to Cdn.$176.05 per
Common Share.
- 5 -
(6) Excludes options to purchase an aggregate of 26,000 Common Shares at
prices ranging from Cdn. $5.70 per Common Share to Cdn. $34.11 per
Common Share.
(7) Excludes options to purchase an aggregate of 26,000 Common Shares at
prices ranging from US $3.90 per Common Share to US $25.64 per Common
Share.
STATEMENT OF CORPORATE GOVERNANCE PRACTICES
INTRODUCTION
The Toronto Stock Exchange (the "TSX") requires that each listed company
disclose on an annual basis its approach to corporate governance, with reference
to guidelines (the "Guidelines") for effective corporate governance published by
the TSX.
The Guidelines address matters such as the constitution and independence of
corporate boards, the functions to be performed by boards and their committees,
and the effectiveness and education of board members. Although there is no
requirement that the Corporation comply with the Guidelines, the Corporation
considers the Guidelines to be helpful in monitoring the effectiveness and the
evolution of its corporate governance and does comply with the Guidelines. The
Corporation's current corporate governance is designed to reflect fairly the
interests of its shareholders and the Corporation's historic and current
development.
The following describes the Corporation's approach to corporate governance:
MANDATE OF THE BOARD OF DIRECTORS
The Board of Directors manages, or supervises the management of, the affairs and
business of the Corporation and acts in accordance with the CANADA BUSINESS
CORPORATIONS ACT, the Restated Articles of Incorporation and By-laws of the
Corporation, all other applicable statutory and legal requirements, the policies
of the Corporation and the written mandate of the Board of Directors and written
charters of the Board committees. Management is responsible for the day-to-day
operation of the business and affairs of the Corporation.
In fulfilling its mandate, the Board of Directors is responsible, among other
things, for the following:
o monitoring and assessing the performance of the Chief
Executive Officer and ensuring that succession planning is in
place;
o approving choices of the Chief Executive Officer for the
executive Management team, monitoring the performance of the
executive Management and ensuring that succession planning is
in place for critical Management positions;
o contributing to the development of the strategic direction of
the Corporation and approving strategic plans;
o ensuring that the Corporation has in place appropriate
processes for risk assessment, management and internal
control, monitoring performance against agreed benchmarks and
assuring the integrity of financial reports; and
o providing assurance to shareholders and stakeholders
concerning the integrity of the Corporation's reported
financial performance.
- 6 -
In order to carry out its functions, the Board of Directors holds regular
meetings and additional meetings as necessary to consider particular matters or
evaluate matters between formal meetings, wherever appropriate. In the year
ended December 31, 2003, the Board of Directors met on eight occasions.
Independently of formal meetings, Management communicates informally with
members of the Board of Directors and solicits the advice of Board of Directors
members falling within their special knowledge or experience.
In the past year, the Board of Directors adopted a Code of Business Conduct and
Ethics applying to all directors, officers and employees of the Corporation to
ensure that the Corporation conducts its business in accordance with the highest
standards of business conduct and ethics.
The Board of Directors expects members of Management of the Corporation to carry
out their duties and to discharge their responsibilities in a professional,
competent and ethical manner. The Board of Directors approves senior executive
appointments and accepts only those individuals who bring exemplary
qualifications and demonstrated abilities to the position. The Board of
Directors fully expects each executive to strive diligently and effectively to
improve the fortunes of the Corporation and contribute to shareholder value.
COMPOSITION OF THE BOARD OF DIRECTORS
The Guidelines recommend careful consideration of the size, composition and
relative independence of corporate boards. The Guidelines define an "unrelated
director" as a director who is independent of management and is free from any
interest and any business or other relationship which could, or could reasonably
be perceived to, materially interfere with the director's ability to act with a
view to the best interests of the Corporation, other than interests and
relationships arising from shareholding. The Guidelines emphasize the ability to
exercise objective judgment, independent of management, as a hallmark of an
unrelated director.
The Board of Directors is composed of seven directors of which all but Mr. David
B. Sutcliffe are outside directors who are "unrelated" within the meaning of the
Guidelines. The Corporation has no "significant shareholder", which the
Guidelines define as a shareholder with the ability to exercise a majority of
the votes for the election of the Board of Directors of a corporation.
INDEPENDENCE FROM MANAGEMENT
The Guidelines state that the Board of Directors should have in place
appropriate structures and procedures to ensure that the Board of Directors can
function independently of management. Since the Chairman of the Board, Mr. David
B. Sutcliffe, is a member of Management, the Board of Directors has appointed
Mr. Peter Ciceri as Lead Independent Director. In this capacity, Mr. Peter
Ciceri acts as liaison between the Board of Directors and Management and
provides leadership to enhance Board effectiveness and to ensure greater
independence of the Board of Directors from Management. The Board of Directors
meets regularly without Management. All three committees of the Board are
comprised solely of outside and unrelated directors and are independent of
Management.
COMMITTEES
AUDIT COMMITTEE
The Audit Committee is composed of Mr. Paul G. Cataford, Mr. Nadir Mohamed and
Ms. S. Jane Rowe (Chair), all of whom are outside and unrelated directors. The
Audit Committee's responsibilities include the review and approval of the
financial statements of the Corporation, the review of the overall scope and
- 7 -
results of the audit and overseeing internal financial controls of the
Corporation. The Audit Committee meets with the Corporation's auditors without
the presence of Management and discusses with the auditors all aspects of the
Corporation's accounting policies and practices.
HUMAN RESOURCES COMMITTEE
The Human Resources Committee (formerly known as the Compensation Committee) is
composed of Mr. Gregory D. Aasen and Mr. Charles E. Levine (Chair), both of whom
are outside and unrelated directors. In 2003, the Board of Directors approved a
written charter for the Human Resources Committee which provides, among other
things, that the Human Resources Committee shall develop compensation policies
to support the Corporation's growth and success, review and recommend annually
to the Board of Directors compensation levels of all directors and officers
including the Chief Executive Officer and review and recommend annually to the
Board of Directors performance objectives and goals for the Chief Executive
Officer.
GOVERNANCE AND NOMINATING COMMITTEE
The Governance and Nominating Committee is composed of Mr. Paul G. Cataford and
Mr. Peter Ciceri (Lead Independent Director), both of whom are outside and
unrelated directors. In 2003, the Board of Directors approved a written charter
for the Governance and Nominating Committee which provides, among other things,
that the Committee shall ensure proper corporate governance in accordance with
applicable guidelines and requirements. In addition, the Governance and
Nominating Committee proposes nominees to the Board of Directors as further
discussed under the heading "New Directors and Orientation Programs" at page 8.
POSITION DESCRIPTIONS
The Board of Directors, together with the Chief Executive Officer, have
developed position descriptions for the Board, the Lead Independent Director and
the Chief Executive Officer. The Board of Directors approves the corporate
objectives that the Chief Executive Officer is responsible for meeting.
DECISIONS REQUIRING BOARD OF DIRECTORS APPROVAL
In addition to those matters which must by law or by the Restated Articles of
Incorporation and By-laws of the Corporation be approved by the Board of
Directors, decisions of strategic significance to the Corporation must be
approved by the Board of Directors. Business plans, budgets, material
expenditures or legal commitments (including debt or equity financings and
material investments, acquisitions and divestitures) by the Corporation are also
subject to review or approval by the Board of Directors. Financial statements
and major disclosure documents are also subject to review and approval by the
Board of Directors or a committee of the Board of Directors.
EFFECTIVENESS OF THE BOARD OF DIRECTORS
The directors of the Corporation complete, on an annual basis, a Board
assessment questionnaire in which they provide feedback on the quality of
corporate governance by the Board of Directors and Management of the
Corporation. The questionnaire covers a variety of issues including Board
composition, the effectiveness of the Board of Directors and its committees and
the quality of the Board of Directors' relationship with Management of the
Corporation. The questionnaire also canvasses opinions with respect to any
perceived need for new officers or directors within the Corporation to ensure
that the Board of Directors and Management reflect the appropriate breadth of
expertise. In addition, on an annual basis, each director completes a
self-assessment questionnaire. The Governance and Nominating Committee
- 8 -
presents a summary of the findings of both questionnaires to the Board of
Directors and recommends any changes for its approval.
NEW DIRECTORS AND ORIENTATION PROGRAMS
The Board of Directors recruits new directors on an as needed basis, and it is
the responsibility of the Governance and Nominating Committee to identify,
evaluate and recommend nominees to the Board of Directors. For each new
director, the Board of Directors defines the background, expertise and personal
qualities that are desirable in nominees, based, in part, on the qualities
already represented by the Board of Directors and the strategic plans of the
Corporation. Upon the addition of a new director, the Governance and Nominating
Committee will ensure that the new director is familiarized with his or her
role, responsibilities and liabilities and provides an overview of the
Corporation and its subsidiaries. This is accomplished by an orientation which
will include meetings with members of Management. In this regard, Management of
the Corporation will make itself available to a new director in order to provide
information and answer any questions that the new director may have.
OUTSIDE ADVICE
The directors of the Corporation are permitted to contact and engage an outside
adviser at the expense of the Corporation in appropriate circumstances. The
engagement of an outside adviser is subject to the approval of the Governance
and Nominating Committee.
INVESTOR RELATIONS
The Chief Financial Officer, the Chief Executive Officer and the corporate
financial staff are responsible for investor relations functions. Inquiries from
shareholders and investment analysts are promptly responded to by employees
responsible for investor relations, or when appropriate, by other executives of
the Corporation.
EXECUTIVE COMPENSATION
EXECUTIVE OFFICERS
The following table sets out the names and ages of each of the executive
officers of the Corporation, the position each executive officer holds with the
Corporation, the length of each executive officer's service with the
Corporation, and all other employment held by each executive officer in the last
five years.
POSITION WITH THE OTHER EMPLOYMENT HELD IN THE
NAME AND AGE OF EXECUTIVE CORPORATION LENGTH OF SERVICE LAST 5 YEARS(1)
------------------------------- ---------------------------- ------------------ --------------------------------------
David B. Sutcliffe Chairman, Chief Executive 9 years Chairman and CEO of the Corporation
(44) Officer and Director since May 2001; President and CEO of
the Corporation from May 1995 to May
2001
Norman Toms Chief Technical Officer 11 years(2) N/A
(59)
- 9 -
POSITION WITH THE OTHER EMPLOYMENT HELD IN THE
NAME AND AGE OF EXECUTIVE CORPORATION LENGTH OF SERVICE LAST 5 YEARS(1)
------------------------------- ---------------------------- ------------------ --------------------------------------
David G. McLennan Chief Financial Officer -- (3) Consultant to BCE Emergis from
(42) and Secretary September 2002 to January 2003;
Chief Financial Officer of Bell
Canada from June 2002 to September
2002; President and Chief Operating
Officer of Bell ExpressVu from
November 1999 to June 2002;
Vice-President, Operations and
Chief Financial Officer of Bell
ExpressVu from February 1997 to
November 1999.
Andrew S. G. Harries Senior Vice-President, 11 years Senior Vice-President, Corporate
(41) Marketing Development of the Corporation from
2000 to 2003; Vice-President,
Marketing of the Corporation from
1993 to February 2000.
Jason W. Cohenour Senior Vice-President, 8 years Senior Vice-President, Distribution
(42) Worldwide Sales of the Corporation from 2000 to
2003; Vice-President, Sales of the
Corporation from 1996 to
February 2000.
James B. Kirkpatrick Senior Vice-President, 1 year(4) President and Chief Executive
(40) Engineering Officer of AirPrime, Inc. from July
2002 to August 2003; Senior
Vice-President, Engineering of
AirPrime, Inc. from September 2000
to March 2003; Vice-President of
Wireless Technologies of DENSO
International America, Inc. from
June 2000 to October 2000; various
positions at DENSO International
America, Inc. from 1997 to June
2000, including Senior Hardware
Director, Hardware Director and
Senior Hardware Manager.
Bill G. Dodson Vice-President, 2 years Vice-President, Global Operations of
(41) Manufacturing and Supply Gateway Computers from 2000 to 2002;
Director of Operations of Toshiba
America Information Systems from
1989 to 2000.
------------------------------
NOTE:
(1) The information as to "other employment" is not within the knowledge of
Management and has been furnished by the respective executive officers.
(2) Mr. Norman Toms will retire from the Corporation on March 31, 2004.
(3) Mr. David G. McLennan joined the Corporation in March 2004 on the
retirement of Mr. Peter W. Roberts as CFO.
(4) Mr. James B. Kirkpatrick joined the Corporation in August 2003, following
the acquisition of AirPrime, Inc. by the Corporation.
- 10 -
INDEBTEDNESS OF DIRECTORS AND SENIOR OFFICERS
There has been no indebtedness outstanding to the Corporation or any of its
subsidiaries owed by any current and former officers, directors and employees of
the Corporation and its subsidiaries at any time during the most recently
completed fiscal year ended December 31, 2003.
INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS
Other than as disclosed in this Information Circular, no insider, proposed
nominee for election as a director, or any associate or affiliate of the
foregoing, had any material interest, direct or indirect, in any transaction or
proposed transaction which has materially affected or would materially affect
the Corporation or any of its subsidiaries.
AGGREGATE COMPENSATION
During the fiscal year ended December 31, 2003, there were seven (7) executive
officers of the Corporation and the aggregate cash compensation paid to them by
the Corporation and its subsidiaries was U.S.$1,562,362.
COMPENSATION OF NAMED EXECUTIVE OFFICERS
The following table sets forth all compensation paid in respect of individuals
(Named Executive Officers) who were, during the fiscal year ended December 31,
2003 (or any portion thereof), the Chief Executive Officer and each of the
Corporation's four most highly compensated executive officers earning a combined
salary and bonus in excess of Cdn.$100,000.
--------------------------- -------- ------------------------------------ ---------------------------------- --------------
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------------------------ ----------------------------------
AWARDS PAYOUTS
----------------------- ----------
LONG
OTHER(3) SECURITIES TERM
ANNUAL UNDER INCENTIVE
COMPEN- OPTIONS RESTRICTED PLAN ALL OTHER(5)
NAME AND PRINCIPAL FISCAL SALARY BONUS(2) SATION GRANTED(4) SHARES PAYMENTS COMPENSATION
POSITION(1) YEAR ($) ($) ($) (#) ($) ($) ($)
--------------------------- -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
David B. Sutcliffe(6) 2003 273,846 66,526 - - - - 1,739
Chairman and Chief -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
Executive Officer 2002 222,930 - - 110,000 - - 3,857
-------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
2001 224,400 61,946 - 12,000 - - 6,060
--------------------------- -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
Norman Toms 2003 160,714 53,410 - - - - 1,305
Chief Technical Officer -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
2002 143,312 - - 12,500 - - 1,089
-------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
2001 144,572 46,105 - 8,000 - - 943
--------------------------- -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
Andrew S. G. Harries (7) 2003 179,451 57,711 - - - - 1,462
Senior Vice-President, -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
Marketing 2002 143,312 - - 50,000 - - 1,234
-------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
2001 144,696 47,213 - 8,000 - - 1,005
--------------------------- -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
Jason W. Cohenour (8) 2003 212,615 60,366 - - - - 9,000
Senior Vice-President, -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
Worldwide Sales 2002 191,000 - - 50,000 - - 24,917
-------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
2001 190,211 74,294 9,530 8,000 - - 9,000
--------------------------- -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
- 11 -
--------------------------- -------- ------------------------------------ ---------------------------------- --------------
ANNUAL COMPENSATION LONG TERM COMPENSATION
------------------------------------ ----------------------------------
AWARDS PAYOUTS
----------------------- ----------
LONG
OTHER(3) SECURITIES TERM
ANNUAL UNDER INCENTIVE
COMPEN- OPTIONS RESTRICTED PLAN ALL OTHER(5)
NAME AND PRINCIPAL FISCAL SALARY BONUS(2) SATION GRANTED(4) SHARES PAYMENTS COMPENSATION
POSITION(1) YEAR ($) ($) ($) (#) ($) ($) ($)
--------------------------- -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
Bill G. Dodson, 2003 182,830 28,559 - - - - 1,358
Vice-President, -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
Manufacturing and Supply 2002 49,583(9) 26,539 - 50,000 - - 154
--------------------------- -------- ------------ ------------ ---------- ----------- ----------- ---------- --------------
NOTES:
(1) All amounts on this table are reflected in U.S.$ at exchange rates of 1.401
for 2003, 1.570 for 2002 and 1.549 for 2001.
(2) Bonuses are generally granted pursuant to the management performance
incentive plan to reward management team performance and are based on
factors including actual revenues and profits versus budgeted revenues and
profits. Bonuses may also be granted to reward outstanding performance.
(3) Other Annual Compensation relates to income from commissions.
(4) All options were granted under the Corporation's Amended and Restated 1997
Stock Option Plan.
(5) All Other Compensation relates to moving compensation, vehicle leases and/or
other taxable benefits.
(6) Mr. Sutcliffe served as both President and Chief Executive Officer of the
Corporation from May 1995 to May 2001. In May 2001, Mr. Sutcliffe resigned
as President of the Corporation and was appointed as the Chairman and Chief
Executive Officer of the Corporation.
(7) Mr. Harries was previously the Senior Vice-President, Corporate Development
of the Corporation from 2000 to 2003 and the Vice-President, Marketing of
the Corporation from 1993 to 2000.
(8) Mr. Cohenour was previously the Senior Vice-President, Distribution of the
Corporation from 2000 to 2002 and the Vice-President, Sales of the
Corporation from 1996 to 2000.
(9) Mr. Dodson joined the Corporation in July 2002.
The aggregate amount paid to all directors and executive officers as a group in
2003 was U.S.$1,674,718.
TERMINATION OF EMPLOYMENT, CHANGE IN RESPONSIBILITIES AND EMPLOYMENT CONTRACTS
The Corporation has entered into executive employment agreements with each of
the Named Executive Officers under which each such executive has agreed to
continue to serve the Corporation in his current office and perform the duties
of such office for an indefinite term. Under the terms of each of the executive
employment agreements, each executive has made commitments in favour of the
Corporation, including non-competition and non-solicitation covenants, minimum
and maximum notice periods in the event of the executive's resignation, and
continued service for a minimum period of time in the event of a change of
control. In consideration of the services to be rendered by each executive under
each of the executive employment agreements, each executive receives an annual
salary and is entitled to participate in the Management bonus and stock option
programs of the Corporation and the dental, medical and other benefit plans as
may be offered by the Corporation to senior officers from time to time. In the
event of the termination of an executive's employment other than for just cause,
the Corporation may elect to provide such executive with either: (i) 12 months
working notice (15 months in the case of Mr. Sutcliffe), plus an additional
month of working notice for each completed 12 month period of service to the
Corporation commencing on the date that the executive commenced employment with
the Corporation (not to exceed 24 months); or (ii) severance pay in lieu of such
working notice. Under the terms of the executive employment contracts for all of
the Named Executive Officers, in the event of actual or constructive termination
of an executive's employment within 12 months following the date of a change of
control of the Corporation, such executive shall be entitled to a severance
payment in an amount equal to 18 months of the executive's average annual
earnings, plus payment in lieu of benefits equal to 15% of the executive's
annual salary.
- 12 -
OTHER COMPENSATION MATTERS
During the most recently completed financial year, there were no long-term
incentive awards made to Named Executive Officers of the Corporation and there
were no pension plan benefits in place for any of the Named Executive Officers.
OPTIONS TO PURCHASE SECURITIES
None of the Named Executive Officers were granted options to purchase Common
Shares of the Corporation during the fiscal year ended December 31, 2003.
OPTION EXERCISES AND NOTIONAL YEAR-END OPTION VALUES
Options to purchase an aggregate of 52,500 Common Shares were exercised by Named
Executive Officers during the fiscal year ended December 31, 2003 as described
in the table below. In addition, the notional value of unexercised but
exercisable/unexercisable options at year-end is set out in the table below. The
value of unexercised in-the-money options is based on a price of Cdn.$20.04, the
closing price of the Common Shares of the Corporation on The Toronto Stock
Exchange on December 31, 2003.
------------------------- ------------ ------------ ---------------------------------- ---------------------------------
NUMBER OF COMMON SHARES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
AT FISCAL YEAR-END AT FISCAL YEAR-END
---------------------------------- ---------------------------------
COMMON
SHARES AGGREGATE
ACQUIRED VALUE
ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
(#) (CDN.$) (#) (#) (CDN.$) (CDN.$)
------------------------- ------------ ------------ ---------------- ----------------- --------------- -----------------
David B. Sutcliffe - - 105,069 69,042 717,440 534,110
------------------------- ------------ ------------ ---------------- ----------------- --------------- -----------------
Norman Toms 20,000 408,000 33,005 8,073 240,118 133,527
------------------------- ------------ ------------ ---------------- ----------------- --------------- -----------------
Andrew S. G. Harries - - 37,596 19,813 421,994 267,055
------------------------- ------------ ------------ ---------------- ----------------- --------------- -----------------
Jason W. Cohenour 25,000 338,300 62,020 19,813 738,193 267,055
------------------------- ------------ ------------ ---------------- ----------------- --------------- -----------------
Bill G. Dodson 7,500 76,875 10,208 32,292 168,840 534,110
------------------------- ------------ ------------ ---------------- ----------------- --------------- -----------------
COMPOSITION OF THE HUMAN RESOURCES COMMITTEE
The Human Resources Committee of the Board of Directors is currently composed of
Gregory D. Aasen and Charles E. Levine (Chair), both of whom are outside and
unrelated directors.
REPORT ON EXECUTIVE COMPENSATION
The Human Resources Committee has prepared the following report on compensation
for the Chief Executive Officer and other executive officers.
The Human Resources Committee is responsible for maintaining the integrity of
all compensation programs and reviewing, and in certain cases recommending
modifications to, the Corporation's executive base and annual incentive
compensation programs. The incentive plans will typically be awarded in the form
of cash and stock option grants and are based on competitive practices of
comparable companies, and serve to align the interests of the executives with
those of the Corporation's shareholders. The Human Resources Committee also
establishes levels of compensation for the Chief Executive Officer and other
executive officers, and recommends to the Board of Directors the granting of
discretionary stock option and cash bonus awards to certain executives, senior
Management, and other key employees.
- 13 -
It is the policy of the Corporation to compensate its executive and senior
Management employees for performance using three forms of remuneration: base
salary, incentive cash awards and stock option grants. Base salary will be
determined largely by reference to market conditions, while annual incentive
cash and stock option awards will provide the opportunity for cash compensation
and enhanced share value for an identified group of employees based upon
exceptional individual and departmental performance, and the overall success of
the Corporation in any given year. Each annual incentive program provides cash
bonus and option grant targets based upon the specific position's level of
responsibility and the position's influence on the immediate and sustained
growth of the Corporation, with final awards determined by a mix of individual,
departmental and Corporation performance.
Presented by the Human Resources Committee:
Gregory D. Aasen
Charles E. Levine
COMPENSATION OF DIRECTORS
During the financial year ended December 31, 2003, the directors of the
Corporation who were not officers of the Corporation each received remuneration
as follows:
Annual Retainer U.S. $10,000
Lead Independent Director's Retainer U.S. $25,000
In-person Board or committee meeting U.S. $750
Board or committee conference call U.S. $375
Directors are limited to one meeting participation fee payable per calendar day.
All directors are reimbursed for travel and other reasonable expenses incurred
in attending Board or committee meetings.
All outside directors are eligible to participate in the Amended and Restated
1997 Stock Option Plan. During 2003, Peter Ciceri was granted options to
purchase 10,000 common shares of the Corporation at an exercise price of
Cdn.$5.43 per share. In addition, Nadir Mohamed and Charles E. Levine were each
granted options to purchase 16,000 common shares of the Corporation at exercise
prices of Cdn.$5.70 and U.S.$3.90, respectively. Executive officers of the
Corporation are not permitted to receive any compensation, including stock
options, to which they might be otherwise entitled by virtue of being directors
of the Corporation.
- 14 -
SHARE PERFORMANCE GRAPH
The following graph compares the Corporation's cumulative shareholder return on
a Cdn.$100 investment in its Common Shares (made May 17, 1999) to the cumulative
return of a comparable investment on S&P/TSX Composite Index (formerly the TSE
300 Composite Index).
[CHART]
----------------------------------------------------------------------------------------------
May Jun Dec Jun Dec Jun Dec Jun Dec Jun Dec
1999 1999 1999 2000 2000 2001 2001 2002 2002 2003 2003
-------------------------------------------------------------------------------------------------------------------------
Sierra Wireless, Inc. 100.00 89.12 442.18 544.22 489.80 190.09 204.08 34.46 46.62 56.42 135.41
S&P/TSX Composite Index 100.00 102.46 122.98 149.02 130.57 113.08 112.37 104.44 96.68 102.07 120.16
-------------------------------------------------------------------------------------------------------------------------
Assuming an investment of Cdn.$100 and the reinvestment of dividends
FINANCIAL STATEMENTS
The consolidated financial statements of the Corporation for the fiscal year
ended December 31, 2003, together with the auditor's report on these statements,
will be placed before shareholders at the Meeting. These financial statements
form part of the accompanying annual report.
GENERAL
All matters referred to herein for approval by the shareholders require a simple
majority of the shareholders voting, in person or by proxy, at the Meeting.
The Corporation knows of no other matters to be submitted to the Meeting. If any
other matters properly come before the Meeting, the persons named in the
accompanying form of proxy will vote the shares
- 15 -
represented by the proxy as the Board of Directors may recommend or as the
Proxyholders, acting in their sole discretion, may determine.
The contents and sending of this Information Circular have been approved by the
Board of Directors of the Corporation.
Dated at Richmond, British Columbia this 24th day of March, 2004.
On Behalf of the Board of Directors
"David G. McLennan"
-------------------------------
David G. McLennan,
Chief Financial Officer and Secretary
- 16 -
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Sierra Wireless, Inc.
By: /s/ David G. McLennan
---------------------------
David G. McLennan
Chief Financial Officer and Secretary
Date: April 2, 2004