SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant To Section 14(a)
Of The Securities Exchange Act Of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, Use of the Commission Only (as permitted by Rule
14aB6(e)(2)) Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
WAVERIDER COMMUNICATIONS INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14aB6(i)(4) and
0B11.
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 0B11 (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 0B11(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:
4) Date Filed:
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WAVERIDER COMMUNICATIONS INC.
255 Consumers Road, Suite 500
Toronto, Ontario, Canada M2J 1R4
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held May 11, 2001
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To our Shareholders:
You are cordially invited to attend the Annual Meeting of Shareholders
of WaveRider Communications Inc. (the "Company") to be held in the Regency West
Ballroom, The Four Seasons Hotel, 21 Avenue Road, Toronto, Ontario Canada M5R
2G1, on Friday, May 11, 2001, at 3:00 p.m. The purpose of the Annual Meeting is
to consider and vote upon the following matters, as more fully described in the
accompanying Proxy Statement:
1) To elect six members of the Board of Directors, each to serve until the
next annual meeting of shareholders and until his respective successor
has been duly elected and qualified; and
2) To consider such other matters as may properly come before the meeting.
The Board of Directors has fixed the close of business on March 30,
2001 as the record date for the determination of shareholders entitled to
receive notice of and to vote at the Annual Meeting or any adjournment or
postponement thereof.
YOUR VOTE IS IMPORTANT!
Please date, sign and return the accompanying proxy card promptly so
that we can be assured of having a quorum at the meeting and so that your shares
may be voted in accordance with your wishes. Doing so will assist the Company in
reducing the expenses of additional proxy solicitation.
Signing and returning the proxy card does not affect your right to vote
in person if you attend the meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ D. Bruce Sinclair
----------------------
D. Bruce Sinclair
President and Chief Executive Officer
DATED: April 13, 2001
IMPORTANT
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, TO ASSURE THAT
YOUR SHARES WILL BE REPRESENTED, PLEASE DATE, FILL IN, SIGN AND MAIL THE
ENCLOSED PROXY TO THE ADDRESS PROVIDED. YOUR PROXY WILL NOT BE USED IF YOU ARE
PRESENT AT THE ANNUAL MEETING AND DESIRE TO VOTE YOUR SHARES PERSONALLY.
PROXY STATEMENT
---------------------
Annual Meeting of Shareholders
to be held on May 11, 2001
Introduction
This Proxy Statement is being furnished to the shareholders of
WaveRider Communications Inc., a Nevada corporation (the "Company"), in
connection with the solicitation by the Board of Directors of the Company (the
"Board") of proxies from holders of outstanding shares of the Company's Common
Stock, $0.001 par value (the "Common Stock"), for use at the Annual Meeting of
Shareholders of the Company to be held Friday, May 11, 2001, and at any
adjournment or postponement thereof (the "Annual Meeting"). This Proxy
Statement, the Notice of Annual Meeting of Shareholders and the accompanying
form of proxy are first being mailed to shareholders of the Company on or about
April 13, 2001.
Solicitation of Proxies
The Company will bear all costs and expenses relating to the
solicitation of proxies, including the costs of preparing, printing and mailing
to shareholders this Proxy Statement and accompanying material. In addition to
the solicitation of proxies by use of the mails, the directors, officers and
employees of the Company, without receiving additional compensation therefor,
may solicit proxies personally or by telephone or telegram. Arrangements will be
made with brokerage firms and other custodians, nominees and fiduciaries for the
forwarding of solicitation materials to the beneficial owners of the shares of
Common Stock held by such persons, and the Company will reimburse such brokerage
firms, custodians, nominees and fiduciaries for reasonable out-of-pocket
expenses incurred by them in connection therewith.
Record Date
The Board has fixed the close of business on March 30, 2001 as the
record date (the "Record Date") for determination of shareholders entitled to
notice of and to vote at the Annual Meeting. As of the Record Date, there were
issued and outstanding 65,956,002 shares of Common Stock, which are entitled to
cast one vote per share.
Quorum
The presence of a majority of the issued and outstanding shares of
Common Stock entitled to vote, represented in person or by properly executed
proxy, is required for a quorum at the Annual Meeting. Abstentions and broker
non-votes, which are indications by a broker that it does not have discretionary
authority to vote on a particular matter, will be counted as "represented" for
the purpose of determining the presence or the absence of a quorum. Under Nevada
corporate law, once a quorum is established, shareholder approval with respect
to a particular proposal is generally obtained when the votes cast in favor of
the proposal exceed the votes cast against such proposal. Shares of the Common
Stock which are entitled to be voted at the Annual Meeting and which are
represented by properly executed proxies will be voted in accordance with the
instructions indicated on such proxies. If no instructions are indicated, such
shares will be voted FOR the election of each of the six director nominees and
in the discretion of the proxy holder as to any other matters which may properly
come before the Annual Meeting.
Revocation of Proxies
A shareholder who has executed and returned a proxy may revoke it at
any time prior to its exercise at the Annual Meeting by executing and returning
a proxy bearing a later date, by filing with the Secretary of the Company, at
the Company's executive office, a written notice of revocation bearing a later
date than the proxy being revoked, or by voting the Common Stock covered thereby
in person at the Annual Meeting.
Vote Required
In the election of directors, shareholders will not be allowed to
cumulate their votes. The six nominees receiving the highest number of votes
will be elected. Any other matter presented for approval by the shareholders
will be approved, in accordance with Nevada law. Accordingly, abstentions and
broker non-votes will not affect the outcome of the election of directors or any
other matter presented for approval by the shareholders.
1
Proposal - Election of Directors
The annual meeting concerns the election of six directors.
The Board of the Company currently consists of six directors. Directors
serve until the next Annual Meeting and until their successors are duly elected
and qualified.
The Board has nominated Gerry Chastelet, John E.Curry, Cameron A.
Mingay, D. Bruce Sinclair, Guthrie J.Stewart and Dennis R.Wing to serve as
directors until the next Annual Meeting. Each of the nominees for Director is
currently a director of the Company. In addition, Mr. Sinclair is the Chief
Executive Officer and President of the Company and Mr. Mingay is the secretary
of the Company.
Each of the nominees has agreed to serve if elected, and the Company
has no reason to believe that any of them will be unable to serve. If any of
them is unable or declines to serve as a director at the time of the Annual
Meeting, proxies will be voted for another nominee that the Board will designate
at that time. Unless authority is withheld, it is the intention of the persons
named in the enclosed form of proxy to vote "FOR" the election of each of the
persons identified as nominees for directors.
The Board recommends that you vote FOR the election of Messrs.
Chastelet, Curry, Mingay, Sinclair, Stewart and Wing as directors of the
Company.
EXECUTIVE OFFICERS AND DIRECTORS
Executive Officers and Directors
Our executive officer and directors are as follows:
Name Age Position
---- --- --------
D. Bruce Sinclair 50 Chief Executive Officer, President, Director
Charles W. Brown 45 Vice President, Sales and Marketing
James H. Chinnick 54 Vice President, Engineering
T. Scott Worthington 46 Vice President, Chief Financial Officer
Cameron A. Mingay (1) 49 Secretary, Director
Gerry Chastelet (1) 54 Director
John E. Curry (2) 54 Director
Guthrie J. Stewart (2) 45 Director
Dennis R. Wing (2) 52 Director
----------
(1) Member of the compensation committee
(2) Member of the audit committee
Gerry Chastelet has been a director of the Company since April 1999.
Since December 1998, Mr. Chastelet has been the President, Chairman and Chief
Executive Officer of Digital Lightwave, Inc., a leading provider of fiber optic
network analysis equipment. From December 1995 to October 1998, he served as
President and Chief Executive Officer of Wandel and Goltermann Technologies,
Inc., a global supplier of communication test and measurement equipment. From
June 1993 to November 1995, he served as Vice President Sales, Marketing and
Service - Americas and Asia Pacific for Network Systems Corporation, a supplier
of channel-attached communications solutions for large mainframe computers. From
1989 to 1993, he was Vice President Sales, Marketing and Service for
Infotron/Gandalf Systems Corporation. Mr. Chastelet holds a degree in
Electronics Engineering from Devry Institute of Technology and is a graduate of
the University of Toronto Executive MBA program.
John E. Curry was appointed a director of the Company in October 1999.
Mr. Curry has been President of Karina Ventures Inc., a venture capital
consulting company since September 1999. Prior, Mr. Curry was with Bedford Curry
& Co., Chartered Accountants, a Vancouver based firm specializing in public
companies and business financing, which he co-founded in 1985. Mr. Curry is a
member of the British Columbia Institute of Chartered Accountants and has a BA
from the University of Western Ontario.
Cameron A. Mingay has been a director of the Company since April 1999
and the Secretary of the Company since May 1999. Since July 1999, Mr. Mingay has
been a partner at Cassels Brock & Blackwell LLP, Toronto, Ontario, Canada,
specializing in the areas of securities and corporate commercial law, with an
emphasis on public offerings, mergers and acquisitions, and corporate
reorganizations. Prior to July 1999, Mr. Mingay was a partner at Smith Lyons
LLP, Toronto, Ontario, Canada. He is currently on the board of Kinross Gold
Corporation and is the Corporate Secretary of Nextair Inc. He completed his
undergraduate degree at the University of Wisconsin and York University and his
law degree from Queen's University.
2
D. Bruce Sinclair has been a director and the President of the Company
since December 1997 and the Chief Executive Officer of the Company since
November 1997. Mr. Sinclair is an experienced management professional with a
Masters of Business Administration from the University of Toronto. He has worked
in sales and management with companies including IBM Canada, Northern Telecom
and Harris Systems Limited. From 1988 to 1991, Mr. Sinclair was with Dell
Computer Corporation, a computer manufacturing company, where he held the office
of President of its Canadian subsidiary. In 1991 he was appointed
Vice-President, Europe for Dell Computer Corporation and subsequently head of
Dell in Europe. He resigned from Dell in 1995 and, until November 1997, he
operated his own independent consulting business.
Guthrie J. Stewart was appointed a director of the Company in October
1999. Mr. Stewart acts as a Board member or consultant to emerging companies,
since October 2000. Prior, he was Executive Vice-President, Global Development
for the Teleglobe Group and Chairman and Chief Executive Officer of Teleglobe
Media Enterprises. Since 1992 until October 2000, he held various executive
positions within the Teleglobe Group including President and Chief Executive
Officer of Teleglobe Canada Inc., Canada's international telecommunications
carrier.
Dennis R. Wing was appointed a director of the Company in November
1999. Mr. Wing is Director of International Operations for Fahnestock & Co.
Inc., a U.S. investment bank. Previously, he was founding partner and Board
Member of First Marathon Securities Inc. and was its Director of International
Operations for 18 years. His other Board memberships include Cryptologic Inc.,
Vengold Inc. and the University of Waterloo. He holds a Bachelor of Arts degree
in Economics from University of Waterloo.
Charles W. Brown has been the Vice President, Marketing of the Company
since February 1998. Mr. Brown has a Masters in Business Administration from the
University of Western Ontario. From 1994 until February 1998, Mr. Brown was
Clearnet Communications' first Vice President and CIO. Prior to this Mr. Brown
has held numerous senior Sales and Marketing positions including Vice President,
Sales and Marketing for Trillium Communications (1993-1994) and Director,
Strategic Planning and Marketing for BCE Mobile (1990-1993).
James H. Chinnick has been Vice President, Engineering of the Company
since January 1999. From 1995 until 1998, Mr. Chinnick was vice president and
general manager of Harris Corporation's Wireless Access Division in Calgary, AB.
Prior to this, Mr. Chinnick held several senior positions with NovAtel
(1988-1995), Northern Telecom (1985-1988), Foundation Electronic Instruments
(1980-1984) and the Communications Research Centre in Ottawa (1971-1980). In
addition to a B.Sc. Engineering (Physics) from Queens University, he has a M.Sc.
in Electrical Engineering (Communications) from Queens University and a Diploma
in Business Administration from the University of Ottawa. He is a member of the
Association of Professional Engineers, Geologists and Geophysicists of Alberta.
T. Scott Worthington has been a Vice President and the Company's chief
financial officer since January 1998. From 1988 to 1996, he worked at Dell
Computer Corporation, in Canada, where he held numerous positions including CFO
of the Canadian subsidiary. From October 1996 to January 1998, he was a
financial and business consultant. Mr. Worthington is a Chartered Accountant.
BOARD AND COMMITTEE MEETINGS
During the year ended December 31, 2000, the Board held five meetings.
Each member attended at least 75% of all board meetings during their term as a
director in 2000.
Compensation Committee Interlocks and Insider Participation
The Company's compensation committee is currently composed of Messrs.
Chastelet and Mingay. Messrs. Chastelet and Mingay are both non-employee
directors. In 2000, no officer or employee of the Company participated in the
deliberations of the compensation committee concerning the compensation of the
Company's executive officers. No interlocking relationship existed between the
Company's Board or compensation committee and the board of directors or
compensation committee of any other company in 2000.
Report Of The Compensation Committee
The compensation committee has general responsibility for our executive
compensation policies and practices, including making specific recommendations
to the board of directors concerning salaries and incentive compensation for our
executive officers. The following report is made by Messrs. Chastelet and
Mingay, as the members of the compensation committee during fiscal 2000, and
summarizes our executive officer compensation policies for fiscal 2000.
3
Compensation objectives. The company's executive compensation programs
are generally designed to relate a substantial part of executive compensation to
improvements in the company's financial performance and corresponding increases
in shareholder value. Decisions concerning executive compensation are intended
to:
o establish incentives that will link executive officer
compensation to the company's financial performance and that
will motivate executives to attain the company's annual
financial targets; and
o provide a total compensation package that is competitive among
comparable companies and that will assist our company in
attracting and retaining executives who will contribute to the
company's long-term financial success.
The Securities and Exchange Commission requires that this report
comment upon the compensation committee's policy with respect to Section 162(m)
of the Internal Revenue Code, which limits the company's tax deduction for
compensation in excess of $1.0 million paid to the company's chief executive
officer and the company's four other most highly compensated executive officers
at the end of any fiscal year unless the compensation qualifies as
"performance-based compensation." The compensation committee's policy with
respect to Section 162(m) is to make every reasonable effort to cause
compensation to be deductible by our company while simultaneously providing
executive officers of our company with appropriate rewards for their
performance.
Executive compensation programs. The company's compensation package
consists of three principal components:
o salary;
o discretionary bonuses; and
o where appropriate to provide longer-term incentive to
executive officers, stock options.
The company's executive officers are also eligible to participate in
other employee benefit plans, including health and life insurance plans and a
stock purchase plan, on substantially the same terms as other employees who meet
applicable eligibility criteria, subject to any legal limitations on the amounts
that may be contributed or the benefits that may be payable under these plans.
In establishing base salaries for executives, the compensation
committee monitors salaries at other companies, particularly companies in the
same industry and companies located in the same geographic area as the company.
In addition, for each executive the compensation committee considers historic
salary levels, work responsibilities and base salary relative to other
executives at the company. To some extent, the compensation committee also
considers general economic conditions, the company's financial performance and
each individual's performance. The compensation committee increased the base
salaries of the company's executive officers in 2000 in accordance with the
company's general policy of adjusting salaries annually to reflect comparable
executive salaries for comparably sized companies and to accomplish the
company's compensation objectives as outlined above.
The company's executive officer compensation policy emphasizes bonuses
and stock options which align the interests of management with the shareholders'
interest in the financial performance of our company for the fiscal year and the
longer term. Consistent with this approach, in fiscal 2000, a substantial part
of the cash compensation that our executive officers were eligible to earn was
tied to the company's performance.
In fiscal 2000, stock options were a component of the company's
approach to compensation for all executive officers. We recommended that our
company grant stock options to Messrs. Sinclair, Brown, Chinnick and Worthington
in order to provide them additional long-term incentives to act in the best
interests of the company's shareholders. See "Option grants in last fiscal
year." In determining the size of the stock option grants recommended for these
executive officers, we emphasized the seniority, responsibilities and
performance of the executives, as well as the number and exercise price of
outstanding stock options previously granted to the executive officers. The
compensation committee believes that stock options provide a significant
incentive to executive officers to continue their employment with our company
and create long-term value for its shareholders.
Chief executive officer compensation. Consistent with the company's
overall executive officer compensation policy, the company's approach to the
chief executive officer's compensation package in 2000 was to be competitive
with other companies in the industry. The compensation committee believes that
this approach provided additional incentive to Mr. Sinclair to achieve the
company's performance goals and enhance shareholder value. Mr. Sinclair's salary
was designed to give him assurance of a base level of compensation commensurate
with his position and duration of employment with the company and competitive
with salaries for officers holding comparable positions in the industry.
The compensation committee
Gerry Chastelet
Cameron A.Mingay
4
Report Of The Audit Committee
The board of directors appointed an audit committee to monitor the
integrity of our company's consolidated financial statements, its system of
internal controls and the independence and performance of its internal and
independent auditors. The audit committee also recommends to the board of
directors the selection of independent auditors. The audit committee is governed
by a written charter adopted by the board of directors. A copy of the charter is
attached to this proxy statement.
The audit committee currently consists of three non-employee directors.
Each member of the audit committee is "independent" within the meaning of the
Nasdaq Stock Market's marketplace rules.
Our company's management is responsible for the financial reporting
process, including the system of internal controls, and for the preparation of
consolidated financial statements in accordance with generally accepted
accounting principles. Our company's independent auditors are responsible for
auditing those financial statements. Our responsibility is to monitor and review
these processes. However, we are not professionally engaged in the practice of
accounting or auditing and are not experts in the fields of accounting or
auditing, including with respect to auditor independence. We have relied,
without independent verification, on the information provided to us and on the
representations made by our company's management and independent auditors.
In fulfilling our oversight responsibilities, we discussed with
representatives of PricewaterhouseCoopers LLP, our company's independent
auditors for fiscal 2000, the overall scope and plans for their audit of our
company's consolidated financial statements for fiscal 2000. We met with them,
with and without our company's management present, to discuss the results of
their examinations and their evaluations of our company's internal controls and
the overall quality of our company's financial reporting.
We reviewed and discussed the audited consolidated financial statements
for fiscal 2000 with management and the independent auditors.
We discussed with the independent auditors the matters required to be
discussed by Statement of Auditing Standards No. 61, Communication with Audit
Committees, as amended, including a discussion of their judgments as to the
quality, not just the acceptability, of our company's accounting principles and
the other matters required to be discussed with audit committees under generally
accepted auditing standards.
In addition, we received from the independent auditors a letter
containing the written disclosures required by Independence Standards Board
Standard No. 1, Independence Discussions with Audit Committees, and discussed
the disclosures with them, as well as other matters relevant to their
independence from management and our company. In evaluating the independence of
our auditors, we considered whether the services they provided to our Company
beyond their audit and review of our consolidated financial statements was
compatible with maintaining their independence. We also considered the amount of
fees they received for audit and non-audit services.
Based on our review and these meetings, discussions and reports, and
subject to the limitations on our role and responsibilities referred to above
and in the audit committee charter, we recommended to the board of directors
that our company's audited consolidated financial statements for fiscal 2000 be
included in our company's annual report on Form 10-K.
The audit committee
John E. Curry
Guthrie J. Stewart
Dennis R. Wing
Independent Accountants
For fiscal 2000, the principal accountant was PricewaterhouseCoopers
LLP and for fiscal 2001, the principal accountant will be PricewaterhouseCoopers
LLP.
Attendance at annual meeting
The Company expects that representatives of PricewaterhouseCoopers LLP
will be present at the annual meeting. They will have an opportunity to make a
statement if they desire to do so and will be available to respond to
appropriate questions from shareholders.
5
Fees for professional services
The following table provides the fees the Company paid to
PricewaterhouseCoopers LLP for professional services rendered for fiscal 2000.
Audit fees consist of fees for services rendered by PricewaterhouseCoopers LLP
in connection with their audit of the Company's annual financial statements and
their review of the Company's interim financial statements included in the
Company's quarterly reports on Form 10-Q for fiscal 2000.
Audit fees......................................................$ 186,095.00
Financial information systems design and implementation fees....$ 0.00
All other fees .................................................$ 163,716.76
OTHER MATTERS
Legal Matters
None.
Other Business
The Board does not know of any matter to be presented at the Annual
Meeting that is not listed in the Notice of Annual Meeting and discussed above.
If other matters should properly come before the Annual Meeting, however, the
proxy holders will vote in accordance with their best judgment.
Section 16(A) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company's executive
officers and directors and certain beneficial owners of the Company's Common
Stock to file initial reports of ownership and reports of changes in ownership
with the SEC. These executive officers, directors and 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
furnished to the Company and written representations from the Company's
executive officers and directors, the Company is not aware of any late filings.
Shareholder Proposals
If any shareholder would like to include any proposal in the Company's
proxy materials for its next annual meeting of shareholders or special meeting
in lieu thereof, the shareholder must comply with the requirements of Rule 14a-8
under the Securities Act of 1934. Among other requirements, the Company must
receive the proposal at its executive offices no later than December 14, 2001.
If any shareholder would like to submit a proposal for that meeting outside the
processes of Rule 14a-8, notice of the proposal will be considered untimely
under Rule 14a-4(c)(1) if the Company received the notice after February 27,
2002.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
Director Compensation
The directors of the Company received $1,000 per meeting attended
during the year and in total were awarded 375,000 options under the Employee
Stock Option (2000) Plan for their participation on the Board and each of its
subcommittees.
Employment Arrangements
In November 1997, the Company entered into an employment agreement with
Mr. Sinclair, which provided for salary, bonus and option grants for the ensuing
year. In addition, under the agreement, in the event that the Company were to
terminate Mr. Sinclair's employment other than for cause (as defined in the
agreement) at any time, the Company would pay to Mr. Sinclair, for a period of
12 months, the base compensation, bonus and health benefits to which he was
entitled on the date of his termination. At a meeting of the Board of Directors,
on February 25, 2000, the guarantee period for Mr. Sinclair was increased from
12 months to 36 months.
In addition, the Company's employment agreements with each of the
current executive officers, other than Mr. Sinclair, provide that in the event
that the Company were to terminate the executive's employment other than for
cause (as defined in the agreements) at any time, the Company would pay to the
executive, for a period of 12 months, the base compensation, bonus and health
benefits to which he was entitled on the date of his termination.
6
Executive Compensation
The following table describes the compensation earned in fiscal 2000 by
the Chief Executive Officer of the Company and all executive officers who
received compensation in excess of $100,000 in 2000, 1999 and 1998.
Summary Compensation Table
Name and Annual Compensation Long-Term Compensation
Principal Position Year Salary Bonus Stock Options
- ------------------ ---- ------------------- ----- ----------------------
Bruce Sinclair 2000 235,627 67,322 500,000
Pres./CEO/Director 1999 204,730 134,617 100,000
1998 182,002 Note (1)
Charles Brown 2000 138,683 42,692 200,000
Vice Pres., Sales & Marketing 1999 128,156 50,885 535,000
1998 101,112 39,045 465,000
James Chinnick 2000 97,482 71,631 200,000
Vice Pres., Engineering 1999 87,748 76,732 630,000
Scott Worthington 2000 111,665 25,784 200,000
Vice President & CFO 1999 103,863 26,923 450,000
1998 76,845 15,369 550,000
(1) Mr. Sinclair's 1998 compensation was based on an annualized amount of
Can. $500,000 payable Can. $270,000 in cash salary with the balance
payable in shares out of the Employee Stock Compensation (1997) Plan
subject to certain performance criteria. Despite having achieved the
bonus requirements, Mr. Sinclair waived receipt of the $155,038 bonus
in conjunction with an agreement with other shareholders who returned
1,000,000 shares for cancellation. This agreement allowed the Company
to issue 1,495,000 options to the other senior executives without
significant further dilution for the shareholders.
The following table summarizes option grants during 2000 to the
executive officers named in the Summary Compensation Table (the "Named Executive
Officers").
Option/SAR Grants in Last Fiscal Year (Individual Grants)
Percent of Total
Number of Options Potential Realizable Value
Securities Granted to Exercise Market at Assumed Annual Rates
Underlying Employees or Base Price on of Stock Price Appreciation
Options in Fiscal Price Date of Expiration for Option Term
Granted Year ($/sh) Grant Date 0% 5% 10%
--------------------------------------------------------------------------------------
Bruce Sinclair (1) 200,000 6.3% $9.03 $9.03 2/25/10 0 90,300 180,600
(2) 300,000 9.4% $9.03 $9.03 2/25/10 0 135,450 270,900
Charles Brown (3) 200,000 6.3% $9.03 $9.03 2/25/10 0 90,300 180,600
James Chinnick (3) 200,000 6.3% $9.03 $9.03 2/25/10 0 90,300 180,600
Scott Worthington (4) 200,000 6.3% $9.03 $9.03 2/25/10 0 90,300 180,600
(1) Options vested in fiscal 2000.
(2) 150,000 options vested in fiscal 2000 and the balance of 150,000
options vest in five years from award.
(3) Options will vest in five years from award.
(4) 100,000 options vested in fiscal 2000 and the balance of 100,000
options will vest in five years from award.
7
Asserted Option/SAR Exercises in Last Fiscal Year and FY-End Option/SAR Values
Number of securities Value of unexercised
underlying unexercised in-the-money
options/SARs at options/SARs at
Shares fiscal year end fiscal year end
acquired on Value Exercisable/ Exercisable/
Name exercise (#) Realized ($) unexercisable unexercisable (1)
- -------------------------------------------------------------------------------------------------------------
Bruce Sinclair 225,000 1,962,345 1,290,000 / 1,085,000 849,022 / 819,978
Charles Brown 125,400 881,013 419,850 / 654,750 45,702 / 0
James Chinnick 70,000 463,773 226,500 / 633,500 0 / 0
Scott Worthington 47,600 430,045 669,900 / 482,500 99,700 / 0
(1) Calculated based on the difference between the exercise price and
the price of a share of the Company's Common Stock on December 31,
1999. The Closing sale price of the Common Stock was $2.25 on December
31, 1999.
Security Ownership of Certain Beneficial Owners and Management.
The following tables set forth, as of March 30, 2001, the stock
ownership of each officer and director of the Company, of all officers and
directors of the Company as a group, and of each person known by the Company to
be a beneficial owner of 5% or more of its Common Stock, $0.001 par value.
Except as otherwise noted, each person listed below is the sole beneficial owner
of the shares and has sole investment and voting power with respect to such
shares. No person listed below has any option, warrant or other right to acquire
additional securities of the Company, except as may otherwise be noted. The
Company had 65,956,002 shares of Common Stock issued and outstanding as of such
date, which numbers do not include any options or warrants issued and
outstanding.
Name and Address Amount and Nature of Percentage of
of Beneficial Owners Beneficial Ownership (1) Class(2)
- --------------------------------------------------------------------------------
Bruce Sinclair, Director, CEO, President, Director 3,290,000(3) 4.89%
Cameron A. Mingay, Secretary/Director 152,500 0.23%
Gerry Chastelet, Director 175,000 0.26%
John Curry, Director 145,000 0.22%
Guthrie Stewart, Director 125,000 0.19%
Dennis Wing, Director 125,000 0.19%
Charles Brown, Vice President, Sales & Marketing 422,826 0.64%
Scott Worthington, Vice-President & CFO 672,249 1.01%
Jim Chinnick, Vice President, Engineering 229,590 0.35%
------------ -----
All Directors and Executive Officers (9) 5,337,165 7.70%
------------ -----
(1) Includes shares subject to an Escrow Agreement, dated March 16, 1998,
as amended September 27, 1999. Does not include employee stock options
not exercisable within 60 days - See Table of Year end Option Values.
(2) Based on 65,956,002 shares of Common Stock outstanding as of March 30,
2001.
(3) Includes shares beneficially owned through a purchase option agreement
with certain other shareholders of the Company that are exercisable
within 60 days.
8
Performance Measurement Comparison (1)
The following table shows the total shareholder return of an investment
of $100 in cash on December 31, 1995 for (a) the Company's Common Stock, (b) the
Nasdaq Stock Market (U.S.) Index, and (c) the Nasdaq Telecommunications Index
("Nasdaq Telecommunications"). All values assume reinvestment of the full amount
of all dividends and are calculated as of December 31 of each year:
COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN*
AMONG WAVERIDER COMMUNICATIONS INC., THE NASDAQ STOCK MARKET (U.S.) INDEX
AND THE NASDAQ TELECOMMUNICATIONS INDEX
[OBJECT OMITTED]
12/95 12/96 12/97 12/98 12/99 12/00
----- ----- ----- ----- ----- -----
WAVERIDER.................... 100 17 299 700 600 392
NASDAQ Stock Market (U.S.)... 100 123 151 213 394 239
NASDAQ Telecommunications.... 100 102 149 247 437 225
* $100 Invested on 12/31/95 in stock or index, including reinvestment of
dividends. Fiscal year ending December 31.
(1) The material in this section is not "soliciting material", is not
deemed "filed" with the SEC, and is not to be incorporated by reference into any
filing of the Company under the Securities Act or the Exchange Act, whether made
before or after the date hereof and irrespective of any general incorporation
language contained in such filing.
Additional Information
A copy of the Company's 2000 annual report is attached to this Proxy
Statement. The Company will mail, without charge, a copy of its annual report on
Form 10-K (excluding exhibits) to any shareholder whose proxy the Company is
soliciting if the shareholder requests it in writing. Please submit any such
written requests to T. Scott Worthington, WaveRider Communications Inc., 255
Consumers Road, Suite 500, Toronto, Ontario, Canada M2J 1R4.
9
CHARTER FOR THE AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS OF WAVERIDER COMMUNICATIONS INC.
Purpose:
The purpose of the Audit Committee (the "Committee") established
pursuant to this charter is to make such examinations as are necessary to
monitor the corporate financial reporting and the internal and external audits
of WaveRider Communications Inc. and its subsidiaries (the "Company"), to
approve expenditures by the Company, to approve policies relating to internal
controls, to provide to the Board of Directors (the "Board") the results of its
examinations and recommendations derived therefrom, to outline to the Board
improvements made or to be made in internal accounting controls, to nominate
independent auditors and to provide to the Board such additional information and
materials as it may deem necessary to make the Board aware of significant
financial matters that require Board attention.
In addition, the Committee shall have the authority to undertake the
specific duties and responsibilities listed below and the authority to undertake
such other specific duties as the Board from time to time may prescribe.
Membership:
The Committee shall consist of at least three (3) members of the Board.
The members of the Committee shall be appointed by, and shall serve at the
discretion of, the Board.
Responsibilities:
The Committee shall have the authority to undertake the following
duties and responsibilities:
1. Reviewing on a continuing basis the adequacy of the Company's
system of internal controls, policies and procedures and
approving policies relating to internal controls and
protection of assets;
2. Reviewing on a continuing basis the activities, organizational
structure and qualifications of the Company's internal audit
function to the extent that the size and operations of the
Company warrant this function;
3. Prior to the annual independent audit, reviewing with the
independent auditors and management the auditors' proposed
audit scope and approach and the areas of audit emphasis;
4. Conducting a post-audit review of the financial statements and
audit findings, including any significant suggestions for
improvements provided to management by the independent
auditors, the form and content of the Company's financial
statements and disclosures and the required communications
from the independent auditors under generally accepted
auditing standards and any applicable Securities and Exchange
Commission ("SEC") regulations;
5. Reviewing the performance of the independent auditors;
6. Reviewing and recommending to the Board the selection and
retention of independent auditors;
7. Approving fee arrangements with the independent auditors;
8. Overseeing compliance with SEC requirements for disclosure of
auditors' services and Committee members and activities;
9. Reviewing, in conjunction with counsel, any legal matters that
could have a significant impact on the Company's financial
statements;
10. Providing oversight and review of the Company's asset
management policies, including an annual review of the
Company's investment policies and performance for cash and
short-term investments, and approving such policies;
11. Instituting, if necessary, special investigations and, if
appropriate, hiring special counsel or experts to assist;
12. Reviewing related party transactions for potential conflicts
of interest and making recommendations to the Board of
Directors with respect thereto;
13. Providing a forum for the independent auditors to meet in
closed session with the Committee;
14. Establishing the delegation of authority to officers of the
Company and approving an authority matrix (the "Matrix")
embodying that delegation;
15. Approving all expenditures, contracts or legal commitments in
excess of amounts for which authority is delegated in the
Matrix;
16. Reviewing with senior management and the independent auditors
the Company's accounting and financial personnel resources;
17. Receiving and reviewing the response of the management of the
Company to any management letter or report from the
independent auditors;
18. Reviewing any dispute between management and the independent
auditors and recommending action to the Board; and
19. Performing other oversight functions as requested by the full
Board of Directors.
In addition to the above responsibilities, the Committee shall
undertake such other duties as the Board delegates to it, and shall report, at
least annually, to the Board regarding the Committee's examinations and
recommendations.
Meetings:
It is anticipated that the Committee will meet at least four times each
year. However, the Committee may establish its own schedule. Each meeting shall
include an executive session that will allow the Committee to maintain free and
open communications with the Company's independent auditors.
The Committee shall meet separately with the Chief Executive Officer
and separately with the Chief Financial Officer of the Company at least annually
to review the financial affairs of the Company. The Committee shall meet with
the independent auditors of the Company, at such times as it deems appropriate,
to review the independent auditor's examination and management report.
The Committee is authorized, by majority vote or unanimous written
consent of its members, to adopt its own rules of procedure, including the
formalities of calling, noticing and holding meetings and for the taking of
action of the Committee by vote at any such meeting or by unanimous written
consent of the members thereof, and that unless and until any such procedures
are formally adopted by the Committee, the procedures with respect to calling,
noticing and holding meetings of the Committee and conducting business of the
Committee shall be the same as those provided in the By-laws of the Company with
respect to calling, noticing and holding meetings of and taking action by the
Board.
Reports:
The Committee may present its summaries of recommendations to the Board
in written or oral form. The Committee recommendations shall be incorporated as
a part of the minutes of the Board meeting at which those recommendations are
presented.
Minutes:
The Committee will maintain written minutes of its meetings, which
minutes will be filed with the minutes of the meetings of the Board.
Other:
The Committee shall have the right, as and when it shall determine to
be necessary or appropriate to the functions of the Committee:
1. at the Company's expense and not at the expense of the members
thereof, to retain counsel (which may be, but need not be, the
regular corporate counsel to the Company) and other advisors
to assist it in connection with its functions; and
2. to request, and to rely upon, advice, orally or in writing,
from the Chief Executive Officer and the Chief Financial
Officer of the Company and from any representative of the
independent auditors to the Company participating in such
independent auditors' engagement by the Company, concerning
aspects of the operation or financial condition of the Company
relevant to the functions of the Committee.
The officers of the Company are requested to cooperate with the
Committee and to render assistance to it as it shall request in carrying out its
functions.
FORM OF PROXY
WAVERIDER COMMUNICATIONS INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints T. Scott Worthington and Cameron A. Mingay, and
each of them, as proxies, with full power of substitution, and hereby authorizes
them to represent and vote, as designated below, all shares of the Common Stock
of WaveRider Communications Inc., a Nevada corporation (the "Company"), held of
record by the undersigned on March 30, 2001 at the Annual Meeting of
Shareholders (the "Annual Meeting") to be held in the Regency West Ballroom, The
Four Seasons Hotel, 21 Avenue Road, Toronto, Ontario Canada M5R 2G1, on Friday,
May 11, 2001, at 3:00 p.m., local time, or at any adjournment or postponement
thereof, upon the matters set forth below, all in accordance with and as more
fully described in the accompanying Notice of Annual Meeting of Shareholders and
Proxy Statement, receipt of which is hereby acknowledged.
1. ELECTION OF DIRECTORS, each to serve until the next annual Meeting of
shareholders of the Company or until their respective successors all have been
duly elected and qualified.
[ ] FOR all nominees listed below (except as marked to the contrary).
[ ] WITHHOLD AUTHORITY to vote for all nominees listed below.
(INSTRUCTION: To withhold authority to vote for any individual nominee strike a
line through the nominee's name in the list below.)
GERRY CHASTELET JOHN CURRY CAMERON MINGAY
BRUCE SINCLAIR GUTHERIE STEWART DENNIS WING
In their discretion, the proxies are authorized to vote upon such other business
as may properly come before the Annual Meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE ELECTION OF THE DIRECTOR NOMINEES NAMED ABOVE.
Please complete, sign and date this proxy where indicated and
return it promptly to:
Mr. T. Scott Worthington
WaveRider Communications Inc.
255 Consumers Road, Suite 500,
Toronto, Ontario Canada M2J 1R4
Date: ______, 2001 Signature: _____________________Signature (if held jointly):
Name (Print) __________________________________ Name (Print - if held jointly)
Registered Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please sign above exactly as the shares are issued. When shares are held by
joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by president or other authorized
officer. If a partnership, please sign in partnership name by authorized
person.)