SCHEDULE 14C
(Rule 14c-101)
INFORMATION REQUIRED IN INFORMATION STATEMENT
SCHEDULE 14C INFORMATION
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of the Securities Exchange Act of 1934
Check the appropriate box:
[ ] Preliminary Information Statement
[ ] Confidential, for use of the Commission only (as permitted by
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[X] Definitive Information Statement
SIRICOMM, INC.
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(Name of Registrant as Specified in its Charter)
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SIRICOMM, INC.
2900 Davis Boulevard, Suite 130
Joplin, Missouri 64804
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NOTICE OF ANNUAL MEETING
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April 18, 2005
NOTICE IS HEREBY given that the Annual Meeting of the stockholders of
SiriCOMM, Inc. (the "Company") will be held at 2900 Davis Boulevard, Suite 130,
Joplin, Missouri 64804 on Wednesday, May 11, 2005 at 3:00 P.M. for the following
purposes:
1. To elect a Board of Directors.
2. To ratify the selection of the Company's independent certified
public accountants for the current fiscal year.
3. To transact such other business as may properly come before
the meeting.
Only stockholders of record as of the close of business on March 24,
2005 will be entitled to notice of and to vote at the annual meeting. A list of
the stockholders as of the record date will be available for inspection by
stockholders at the Company's corporate offices for a period of ten days prior
to the Annual Meeting.
Your attention is directed to the attached Proxy Statement and the
enclosed Annual Report of the Company for the fiscal year ending September 30,
2004.
Please sign, date and mail the enclosed proxy promptly in the enclosed
postage-paid envelope so that your shares will be represented at the meeting.
THE COMPANY URGES THAT AS MANY STOCKHOLDERS AS POSSIBLE BE REPRESENTED
AT THE MEETING. WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, YOU ARE
URGED TO READ THE ATTACHED PROXY STATEMENT AND THEN FILL IN, DATE, SIGN AND
RETURN PROMPTLY THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE. IF YOU ARE PRESENT
IN PERSON AT THE MEETING, YOU MAY VOTE IN PERSON REGARDLESS OF HAVING SENT IN
YOUR PROXY. IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING AND
YOUR PROMPTNESS WILL ASSIST US IN PREPARATIONS FOR THE MEETING.
By Order of the Board of Directors
J. Richard Iler, Secretary
SIRICOMM, INC.
2900 Davis Boulevard, Suite 130
Joplin, Missouri 64804
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PROXY STATEMENT
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April 18, 2005
This proxy statement sets forth certain information with respect to the
accompanying proxy to be used at the 2005 Annual Meeting of stockholders (the
"Meeting") of SiriCOMM, Inc. (the "Company") or at any adjournment thereof, for
the purposes set forth in the accompanying Notice of Annual Meeting. The proxy
statement and enclosed form of proxy are first being mailed to stockholders on
or before April 18, 2005. The Board of Directors of the Company solicits this
proxy and urges you to sign the proxy, fill in the date and return same
immediately.
Shares of the Company's common stock, $.001 par value (the "Common
Stock"), represented by valid proxies in the enclosed form, executed and
received in time for the meeting, will be voted as directed, or if no direction
is indicated, will be voted for the election as directors of the nominees
described herein. Proxies are being solicited by mail, and, in addition,
officers and regular employees of the Company may solicit proxies by telephone
or personal interview. As is customary, the expense of solicitation will be
borne by the Company. The Company will also reimburse brokers for the expenses
of forwarding proxy solicitation material to beneficial owners of shares held of
record by such brokers. Your prompt cooperation is necessary in order to insure
a quorum and to avoid expense and delay.
PROXIES ARE REVOCABLE AT ANY TIME PRIOR TO BEING VOTED EITHER BY
WRITTEN NOTICE DELIVERED TO THE SECRETARY OF THE COMPANY OR BY VOTING AT THE
MEETING IN PERSON.
The mailing address of the principal executive offices of the Company
is 2900 Davis Boulevard, Suite 130, Joplin, Missouri 64804. The annual report of
the Company for the fiscal year ended September 30, 2004 ("Fiscal 2004")
including consolidated financial statements, supplementary financial information
and management's discussion and analysis of financial condition and results of
operations, accompanies this proxy statement.
1
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Company's bylaws provide that the Board of Directors shall consist
of one or more members, the number thereof to be determined from time to time by
the Board of Directors. Directors need not be stockholders.
Proxies are solicited in favor of the six nominees named below, all of
whom, except for William P. Moore, are now serving as directors. In the event
one or more of the nominees is unable to serve as a director, it is intended
that the proxies will be voted for the election of such other person, if any, as
shall be designated by the Board of Directors. The Company is unaware of any
information that would indicate that any of the nominees will be unable to serve
and is not presently considering any additional persons to serve on the Board.
Name Age Position Director Since
---- --- -------- --------------
Henry P. (Hank) Hoffman 51 President, CEO and Chairman 2002
David N. Mendez 41 Executive Vice President - 2002
Sales and Marketing and
a Director
Kory S. Dillman 31 Executive Vice President - 2002
Internet Business
Development and a Director
J. Richard Iler 51 Chief Financial Officer, 2003
Director
Terry W. Thompson 51 Director 2003
William P. Moore 60 Director --
Directors are elected to serve until the next Annual Meeting of
shareholders and until their successors have been elected and qualified. The
Company's officers are appointed by the Board of Directors and hold office at
the will of the Board.
Henry P. (Hank) Hoffman
Mr. Hoffman was appointed President and CEO of the Company on November
21, 2002. On that same date Mr. Hoffman was elected to the Board of Directors of
the Company and to serve as its Chairman. Mr. Hoffman co-founded SiriCOMM in
January 2000 and has been its President, CEO and Chairman since SiriCOMM's
inception. Mr. Hoffman has over twenty years experience in the transportation
industry. From September 1, 1996 to January 21, 2000 Mr. Hoffman was President
and Chief Operating Officer of Hook Up, Inc. of Joplin, MO, a small niche motor
carrier. From 1990 to 1995 Mr. Hoffman was President and COO of Tri-State Motor
Transit, the nation's largest transporter of munitions for the U.S. Government.
Prior to his term at Tri-State, he served in several
Operations/Management positions with both Schneider National, Inc. and Viking
Freight System. As an industry leader he has been a Vice President of the
2
American Trucking Associations, President and Chairman of the Board of the
Munitions Carriers Conference, member of the Board of Directors of the National
Automobile Transporters Association, and Forum Co-Chairman of the National
Defense Transportation Association. Prior to his trucking industry career, Mr.
Hoffman served as an officer in the United States Army Field Artillery for six
years where he completed two command assignments. Mr. Hoffman earned a Bachelor
of Science degree from the United States Military Academy, West Point, NY and a
Master of Business Administration from the University of Wisconsin, Oshkosh, WI.
David N. Mendez
Mr. Mendez was appointed Executive Vice President - Sales and Marketing
on November 21, 2002. On that same date Mr. Mendez was also elected a director
of the Company. Mr. Mendez co-founded SiriCOMM in April 2000 and has been its
Executive Vice President Sales and Marketing and a director since SiriCOMM's
inception. Mr. Mendez has over nine years experience in telecommunications sales
and marketing. Mr. Mendez's telecommunications expertise focuses on domestic and
international data communication networks including Frame Relay and ATM
infrastructures and Internet and intranet networks. From October 1998 to
February 2000 he was National Sales Manager for DRIVERNet where he managed such
national accounts as Ford, Kenworth, Peterbilt, Paccar Corporation, and Cue
Paging. From 1995 to 1998 Mr. Mendez worked as a Major Account Manager for
Sprint. Mr. Mendez graduated with a Bachelor of Science degree from Southwest
Missouri State University, Springfield, MO.
Kory S. Dillman
Mr. Dillman was appointed Executive Vice President - Internet Business
Development on November 21, 2002. On that same date Mr. Dillman was also elected
a director of the Company. Mr. Dillman co-founded SiriCOMM in April 2000 and has
been its Executive Vice President - Internet Business Development and a director
since SiriCOMM's inception. From 1996 to 1999 Mr. Dillman was Creative Director
for DRIVERNet. In that position he produced intranet and Internet applications
for DRIVERNet and its customers. He developed specific web-based products for
Volvo Trucks North America, Kenworth, Peterbilt, Ambest, Caterpillar Engines,
and TravelCenters of America. Prior to joining DRIVERNet Mr. Dillman was Art
Director for Wendfall Productions. In this position he managed development for
Sony Music and Ardent Records. Mr. Dillman earned a Bachelor of Fine Arts degree
from the University of Tulsa, Tulsa, OK.
J. Richard Iler
Mr. Iler was appointed Chief Financial Officer and elected to the Board
of Directors in April 2003. From 2001 through 2003, Mr. Iler was managing
director of a private equity fund responsible for financing activities,
management consulting and investor relations of the funds portfolio companies.
From 1998 through 2001, Mr. Iler was Chief Financial Officer of United American
e-Health Technologies, a publicly traded company. Mr. Iler assisted this company
in raising capital and preparation of regulatory filings. Mr. Iler graduated
from Grand Valley State University in Allendale, Michigan with a B.S. and
attended South Texas College of Law in Houston, Texas.
3
Terry W. Thompson
Mr. Thompson was elected to the Board of Directors in August 2003. In
2002, Mr. Thompson retired as President of Jack Henry and Associates, a provider
of integrated computer systems and processor of ATM and debit card transactions
for banks and credit unions. Mr. Thompson joined Jack Henry in 1990 as Chief
Financial Officer was appointed President in 2001 guiding the Company from $15
million in revenues to more than $365 million and from 98 employees to 2300
employees. It is anticipated that Mr. Thompson will be named Chairman of the
Company's Audit Committee, when organized.
William P. Moore
William P. Moore was nominated to the Board of Directors on April 11,
2005 to be presented to the stockholders at the annual meeting for the purposes
of being elected a Director of the Corporation. Mr. Moore has pursued a career
as an entrepreneur since 1980 when he founded Continental Exploration, Inc. The
oil and gas exploration and production company grew to become one of the most
successful oil companies in the Eastern Kansas area during the 1990's. Mr. Moore
sold Continental Exploration, Inc. in 2000. In 1990, he acquired a significant
ownership position in Crude Marketing, Inc., a newly formed company which
purchased crude oil at the wellhead in Eastern Kansas, transported the oil by
truck to pipeline terminals, and sold it to major oil refining companies. At the
time Mr. Moore and his partner sold Crude Marketing, Inc. in 2001, it had grown
to become the second largest oil purchaser in its market and the company had
earned a reputation for the superior service and competitive pricing it provided
its customers. In 1995, Mr. Moore co-founded Continental Coal, Inc. which
operates two surface coal mines in Western Missouri and Eastern Kansas. Coal
extracted from the mines is sold to local utility companies and transported by
truck to their power generation plants. Continental Coal, Inc has become known
for the excellent efficiency of its mines and the superior reclamation of its
mine sites. In 2003, Mr. Moore co-founded Watersports, LLC which owns and
operates a cable wakeboard lake and other recreational facilities in the Kansas
City area. More recently, he co-founded Sunflower Energy, LLC, an oil and gas
exploration company preparing to conduct exploratory drilling in Western Kansas
and Sterling Coach, LLC, a company specializing in the design and manufacturing
of superior quality horse trailers.
Mr. Moore graduated from the United States Military Academy, West
Point, New York, in 1967 with a Bachelor of Science degree. Following four years
of military service, including nineteen months in the Republic of South Vietnam,
Mr. Moore enrolled at Harvard University where he received a Master of Business
Administration degree in 1973.
4
PROPOSAL NO. 2
TO RATIFY THE SELECTION OF
BKD LLP
AS INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors has recommended that BKD LLP be retained as the
Company's independent certified public accountants for the fiscal year ending
September 30, 2004. Although this recommendation is not required to be submitted
to a vote of stockholders, the Board of Directors believes it appropriate as a
matter of policy that this recommendation be submitted for ratification at the
Company's annual meeting. In the event the stockholders do not ratify the
retention of BKD LLP, the selection of other independent auditors will be
considered by the Board of Directors. See "Relationship with Independent
Certified Public Accountants".
Stockholder Vote Required
The affirmative vote of the holders of a majority of the shares present
in person and by proxy and voting at the Meeting is required for ratification of
the selection of independent certified public accountants.
The Board of Directors recommends a vote FOR ratification of the
selection of BKD LLP.
VOTING SECURITIES AND RECORD DATE
Holders of Common Stock of the Company of record at the close of
business on March 24, 2005 are entitled to notice and to vote at the Annual
Meeting. At the close of business on March 24, 2005 the Company had 18,696,450
shares of Common Stock outstanding, for which each holder is entitled to one
vote.
5
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of March 24, 2005, the number and
percentage of shares of Common Stock of the Company, owned of record and
beneficially, by each person known by the Company to own 5% or more of such
stock, each director of the Company, and by all executive officers and directors
of the Company, as a group:
Amount and Nature of Beneficial Ownership
Amount of Percent of
Name and Address Beneficial Ownership (1) Beneficial Ownership (2)
----------------- ------------------------ ------------------------
Henry P. Hoffman 5,712,303 30.55%
2900 Davis Boulevard, Suite 130
Joplin, MO 64804
David N. Mendez 1,063,331 5.69%
2900 Davis Boulevard, Suite 130
Joplin, MO 64804
Kory S. Dillman 1,023,535 5.47%
2900 Davis Boulevard, Suite 130
Joplin, MO 64804
J. Richard Iler (3) 140,000 0.07%
12 Jennifer Drive
Westford, MA 01886
Terry W. Thompson (4) 370,884 1.97%
406 N. Belaire
Monett, MO 65708
William P. Moore, III, as Trustee of the (5) 1,700,000 8.70%
William P. Moore III Revocable Trust dated
October 9, 2001
10801 Mastin, Suite 920
Overland Park, KS
Quest Capital Alliance LLC 1,154,000 6.17%
3140 E. Division
Springfield, MO 65802
Robert J. Smith (6) 1,553,931 8.21%
3865 E. Turtle Hatch
Springfield, MO 65809
All Directors and Officers as a Group
(6 Persons)(3)(4)(5) 10,010,053 50.46%
-----------------
(1) Except as otherwise indicated, includes total number of shares outstanding
and the number of shares which each person has the right to acquire within
60 days through the exercise of warrants or the conversion of Preferred
6
Stock pursuant to Item 403 of Regulation S-B and Rule 13d-3(d)(1),
promulgated under the Securities Exchange Act of 1934.
(2) Based upon 18,696,450 shares issued and outstanding.
(3) Includes 120,000 shares which may be obtained by Mr. Iler upon the exercise
of a like number of options exercisable at $1.00 per share and 20,000
shares which may be obtained by Mr. Iler upon the exercise of a like number
of options exercisable at $1.49 per share.
(4) Includes 150,600 shares which may be obtained by Mr. Thompson upon the
exercise of a like number of warrants exercisable at $2.00 per share.
(5) Includes 850,000 shares which may be obtained upon the exercise of a like
number of warrants exercisable at $2.00 per share.
(6) Includes 436,000 shares owned by Gunner Investments Corp., a company
controlled by Mr. Smith. Includes 154,600 shares which may be obtained upon
the exercise of a like number of warrants exercisable at $2.00 per share.
Includes 78,000 shares which may be obtained upon the exercise of a like
number of warrants exercisable at $.50 per share.
As ownership of shares of the Company's common stock by each of the
Company's directors and executive officers is included within the foregoing
table, and as the Company currently employs no additional executive officers, no
separate table has been provided to identify Company stock ownership by
management personnel.
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires directors and certain officers of the Company, as well as persons who
own more than 10% of a registered class of the Company's equity securities
("Reporting Persons"), to file reports with the Securities and Exchange
Commission. The Company believes that during fiscal 2004, all Reporting Persons
timely complied with all filing requirements applicable to them except that a
former director, Mr. Austin O'Toole's initial statement of ownership on Form 3,
which disclosed that he had no beneficial interest in any equity securities of
the Company was filed after the due date.
To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended September 30, 2003 all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten percent shareholders were complied with.
INFORMATION CONCERNING BOARD OF DIRECTORS
AND COMMITTEES
Board of Directors; Committees
The Board of Directors has the responsibility for establishing
corporate policies and for the overall performance of the Company. The Board of
Directors held 5 meetings during fiscal 2004. During fiscal 2004 all other
actions requiring the approval of the Board of Directors was taken by unanimous
written consent.
7
The Board of Directors established an audit committee on June 14, 2004.
Audit Committee
On June 14, 2004, the Board of Directors established an audit committee
and elected Austin O'Toole and Terry W. Thompson as members of the Audit
Committee. The Board of Directors had determined that Mr. Thompson and Mr.
O'Toole were both independent and Mr. Thompson was named an audit committee
financial expert, as determined by SEC guidelines. On March 2, 2005 Mr. O'Toole
resigned from the Board of Directors and resultantly also resigned from the
Audit Committee. The Company expects to elect Mr. William P. Moore to the Audit
Committee once he is elected to the Board of Directors. The members of the Audit
Committee met 2 times between June 14, 2004 and September 30, 2004. The Board of
Directors adopted a charter for the Audit Committee on June 14, 2004, which is
attached as an exhibit to this report. The functions of the Audit Committee
include the following:
o Recommending annually to the Board of Directors the appointment of the
independent public accountants of the Company;
o Reviewing the scope of the prospective annual audit and reviewing the
results thereof with the independent public accountants;
o Determining the independence of the independent public accountants;
o Making inquires with respect to the appropriateness of accounting
principles followed by the Company; and
o Receiving and reviewing reports from Company management relating to
the Company's financial reporting process, the adequacy of the
Company's system of internal controls, and legal and regulatory
matters that may have a material impact on the Company's financial
statements and compliance policies.
Audit Committee Report
The Company's Audit Committee for fiscal year 2004 has reviewed and
discussed the audited financial statements for that year with management. The
Audit Committee discussed with management the matters set forth in SAS 61
(Codification of Statements on Auditing Standards, AU Section 380), which
include, among other things:
o Methods used to account for significant unusual transactions;
o The effect of significant accounting policies in controversial or
emerging areas for which there is a lack of authoritative guidance or
consensus;
o The process used by management in formulating particularly sensitive
accounting estimates and the basis for the auditor's conclusions
regarding the reasonableness of those estimates; and
8
o Management's application of accounting principles, the basis for
management's accounting estimates, and the disclosures in the
financial statements.
The Audit Committee has received the written disclosures and the letter
from BKD, LLP, the Company's independent accountants, required by Independence
Standards Board Standard No. 1, Independence Discussions with Audit Committees
and has discussed with BKD, LLP the issue of its independence from the Company.
Based on its review of the audited financial statements and the various
discussions noted above, the Audit Committee recommended to the Board of
Directors that the audited financial statements be included in the Company's
Annual Report on Form 10-KSB for the fiscal year ended September 30, 2004.
Terry W. Thompson, Chairman
Compensation Committee
The Company does not have a compensation committee. The Board of
Directors as a whole performs the functions customarily attributable to a
compensation committee.
Nominating Committee
The Company does not have a nominating committee. The Board of
Directors as a whole performs the functions customarily attributable to a
nominating committee.
On August 30, 2004, the Board authorized the following compensation
package for its independent board members.
o Annual Cash Retainer - $3,500 per fiscal year
o Meeting Fee - $1,000 plus reasonable travel-related expenses for
on-site board meetings and/or on-site committee meetings.
Stock Options - New independent board members receive an initial grant of ten
thousand (10,000) stock options. The options vest over three years, 4,000 year
one, 3,000 year two and 3,000 year three. In addition, on their anniversary of
appointment, all board members will receive an annual grant of 3,000 shares.
Each option granted hereunder will be priced at market.
EXECUTIVE COMPENSATION
Summary Compensation Table
The Summary Compensation Table shows certain compensation information
for services rendered in all capacities for the fiscal years ended September 30,
2002, 2003 and 2004. Other than as set forth herein, no executive officer's
9
salary and bonus exceeded $100,000 in any of the applicable years. The following
information includes the dollar value of base salaries, bonus awards, the number
of stock options granted and certain other compensation, if any, whether paid or
deferred.
SUMMARY COMPENSATION TABLE
Long Term
Annual Compensation Compensation
------------------------------------------------ ----------------
Fiscal Year
Ended
Name and Principal Position September 30 Salary ($) Bonus ($) Options/SARS (#)
--------------------------- ------------ ---------- --------- ----------------
Henry P. Hoffman (a) 2004 $175,000 - -
President, CEO and Chairman 2003 150,000 - -
2002 118,269
David N. Mendez (b) 2004 125,000 - -
EVP- Sales and Marketing and Director 2003 125,000 - -
2002 93,750
Kory S. Dillman (b) 2004 125,000 - -
EVP - Internet Business Development 2003 125,000 - -
and Director 2002 98,558
J. Richard Iler 2004 75,831
Chief Financial Officer and Director 2003
2002
--------------------
(a) includes $93,750 in accrued and unpaid compensation.
(b) includes $78,125 each in accrued and unpaid salary
Employment Contracts
We have employment agreements with three of our executive officers,
Henry P. Hoffman, David N. Mendez and Kory S. Dillman.
Mr. Hoffman's employment agreement, dated February 19, 2002 has an
initial term of three (3) years and a base annual salary of $150,000 and was
increased to $175,000 in 2004. Thereafter the agreement automatically renews for
additional one-year periods. Bonuses, if any, are to be paid at the sole
discretion of our Board of Directors.
Mr. Mendez' employment agreement, dated February 19, 2002 has an
initial term of three (3) years and a base annual salary of $125,000. Thereafter
the agreement automatically renews for additional one-year periods. Bonuses, if
any, are to be paid at the sole discretion of our Board of Directors.
Mr. Dillman's employment agreement, dated February 19, 2002 has an
initial term of three (3) years and a base annual salary of $115,000, which has
been increased to $125,000. Thereafter the agreement automatically renews for
additional one-year periods. Bonuses, if any, are to be paid at the sole
discretion of our Board of Directors.
10
Stock Options
OPTIONS/SAR GRANTS TABLE
Option/SAR Grants in the Last Fiscal Year
Individual Grants
% of Total
Options/SARs
Granted to Exercise or
Fiscal Options/SARs Employees in Base Price Expiration
Name and Principal Position Year Granted (#) Fiscal Year ($/Sh) Date
--------------------------- ------ ------------ ------------ ----------- ----------
Henry P. Hoffman 2004 -0- 0.0% -0- --
President, CEO and Chairman of the
Board
David N. Mendez 2004 -0- 0.0% -0- --
EVP- Sales and Marketing and Director
Kory S. Dillman 2004 -0- 0.0% -0- --
EVP - Internet Business Development
and Director
J. Richard Iler 2004 145,000 0.0% $1.00 11/17/13
Chief Financial Officer and Director
11
OPTIONS/SAR EXERCISES AND YEAR-END VALUE TABLE
Aggregated Options/SAR Exercises in Last Fiscal Year and FY-End Options/SAR Value
Value of
Number of Unexercised
Shares Unexercised In-the-money
Acquired Options/SARs at Options/SARs at
on Value FY-End (#) FY-End ($)
Fiscal Exercise Realized Exercisable / Exercisable /
Name and Principal Position Year (#) ($) Unexercisable Unexercisable
--------------------------- ---- -------- -------- --------------- ---------------
Henry P. Hoffman 2004 -0- -0- (E)-0- / (U)-0- (E)$0 /(U)$0
President, CEO and Chairman of the
Board
David N. Mendez 2004 -0- -0- (E)-0- / (U)-0- (E)$0 /(U)$0
EVP- Sales and Marketing and Director
Kory S. Dillman 2004 -0- -0- (E)-0- / (U)-0- (E)$0 /(U)$0
EVP - Internet Business Development
and Director
J. Richard Iler 2004 4,200 -0- (E)140,800 / (U)-0- (E)$0 /(U)$0
Chief Financial Officer and Director
2002 Incentive Stock Option Plan
The Company in 2002, adopted a 2002 Equity Incentive Plan (the "Plan").
The Plan designates a Stock Option Committee appointed by the Board of Directors
and authorizes the Stock Option committee to grant or aware to eligible
participants of the Company and its subsidiaries and affiliates, until May 15,
2012, stock options, stock appreciation rights, restricted stock performance
stock awards and Bonus Stock awards for up to 3,000,000 shares of the New Common
Stock of the Company. The initial members of the Stock Option Committee have not
yet been appointed. During fiscal 2004, the Company issued 304,500 options and
or bonus shares under the plan.
The following is a general description of certain features of the Plan:
1. Eligibility. Officers, directors and other key employees and
consultants of the Company, its subsidiaries and its affiliates who are
responsible for the management, growth and profitability of the business of the
Company, its subsidiaries and its affiliates are eligible to be granted stock
options, stock appreciation rights, and restricted or deferred stock awards
under the Plan. Directors are eligible to receive Stock Options.
12
2. Administration. The Incentive Plan is administered by the Stock
Option Committee of the Company. The Board, in the absence of the establishment
of this Committee, acts in the capacity of this Committee. The Stock Option
Committee has full power to select, from among the persons eligible for awards,
the individuals to whom awards will be granted, to make any combination of
awards to any participants and to determine the specific terms of each grant,
subject to the provisions of the Incentive Plan.
3. Stock Options. The Plan permits the granting of non-transferable
stock options that are intended to qualify as incentive stock options ("ISO's")
under section 422 of the Internal Revenue Code of 1986 and stock options that do
not so qualify ("Non-Qualified Stock Options"). The option exercise price for
each share covered by an option shall be determined by the Stock Option
Committee but shall not be less than 100% of the fair market value of a share on
the date of grant. The term of each option will be fixed by the Stock Option
Committee, but may not exceed 10 years from the date of the grant in the case of
an ISO or 10 years and two days from the date of the grant in the case of a
Non-Qualified Stock Option. In the case of 10% stockholders, no ISO shall be
exercisable after the expiration of five (5) years from the date the ISO is
granted.
4. Stock Appreciation Rights. Non-transferable stock appreciation
rights ("SAR's") may be granted in conjunction with options, entitling the
holder upon exercise to receive an amount in any combination of cash or
unrestricted common stock of the Company (as determined by the Stock Option
Committee), not greater in value than the increase since the date of grant in
the value of the shares covered by such right. Each SAR will terminate upon the
termination of the related option.
5. Restricted Stock. Restricted shares of the common stock may be
awarded by the Stock Option Committee subject to such conditions and
restrictions as they may determine. The Stock Option Committee shall also
determine whether a recipient of restricted shares will pay a purchase price per
share or will receive such restricted shares without, any payment in cash or
property. No Restricted Stock Award may provide for restrictions beyond ten (10)
years from the date of grant.
6. Performance Stock. Performance shares of Common Stock may be awarded
without any payment for such shares by the Stock Option Committee if specified
performance goals established by the Committee are satisfied. The designation of
an employee eligible for a specific Performance Stock Award shall be made by the
Committee in writing prior to the beginning of the period for which the
performance is based. The Committee shall establish the maximum number of shares
to stock to be issued to a designated Employee if the performance goal or goals
are met. The committee reserves the right to make downward adjustments in the
maximum amount of an Award if, in it discretion unforeseen events make such
adjustment appropriate. The Committee must certify in writing that a performance
goal has been attained prior to issuance of any certificate for a Performance
Stock Award to any Employee.
7. Bonus Stock. The committee may award shares of Common Stock to
Eligible Persons, without any payment for such shares and without any specified
13
performance goals. The Employees eligible for bonus Stock Awards are senior
officers and consultants of the Company and such other employees designated by
the Committee.
8. Transfer Restrictions. Grants under the Plan are not transferable
except, in the event of death, by will or by the laws of descent and
distribution.
9. Termination of Benefits. In certain circumstances such as death,
disability, and termination without cause, beneficiaries in the Plan may
exercise Options, SAR's and receive the benefits of restricted stock grants
following their termination or their employment or tenure as a Director as the
case may be.
10. Change of Control. The Plan provides that (a) in the event of a
"Change of Control" (as defined in the Plan), unless otherwise determined by the
Stock Option Committee prior to such Change of Control, or (b) to the extent
expressly provided by the Stock Option Committee at or after the time of grant,
in the event of a "Potential Change of Control" (as defined in the Plan), (i)
all stock options and related SAR's (to the extent outstanding for at least six
months) will become immediately exercisable: (ii) the restrictions and deferral
limitations applicable to outstanding restricted stock awards and deferred stock
awards will lapse and the shares in question will be fully vested: and (iii) the
value of such options and awards, to the extent determined by the Stock Option
Committee, will be cashed out on the basis of the highest price paid (or
offered) during the preceding 60-day period, as determined by the Stock Option
Committee. The Change of Control and Potential Change of Control provisions may
serve as a disincentive or impediment to a prospective acquirer of the Company
and, therefore, may adversely affect the market price of the common stock of the
Company.
11. Amendment of the Plan. The Plan may be amended from time to time by
majority vote of the Board of Directors provided as such amendment may affect
outstanding options without the consent of an option holder nor may the plan be
amended to increase the number of shares of common stock subject to the Plan
without stockholder approval.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Except as set forth below, there have neither occurred within the last
three years, nor are there any pending or proposed, direct or indirect material
transactions between us and any of our directors, executive officers or
controlling shareholders outside the ordinary course of our business at the same
prices as with unaffiliated companies.
From December 2002 through September 2003, the Company borrowed an
aggregate of $375,000 from unaffiliated third parties and $30,000 from the
Company's CEO. The loan to its CEO was repaid in 2004. In connection with these
loans, the Company issued the lenders an aggregate 137,782 shares of its common
stock. In connection with these loans, the Company's CEO issued an aggregate of
375,000 options to purchase shares of his own stock at $1.00 per share. On
August 8, 2003, Mr. Terry Thompson, who had lent the Company an aggregate of
$50,000 and received 19,684 of these shares and 50,000 of the aforementioned
options, was elected a director of the Company. The shares were issued under the
exemption from registration provided in Section 4(2) of the Securities Act of
1933. The lenders represented their intention to acquire the securities for
14
investment only and not with a view to or for sale in connection with any
distribution of the securities and appropriate legends were affixed to the
certificates. The Company utilized the proceeds of these loans for general
working capital purposes.
RELATIONSHIP WITH INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Audit Committee of the Board of Directors of SiriCOMM, Inc. has
recommended that BKD LLP be retained to serve as the Company's independent
public accountants for the fiscal year ended September 30, 2005 ("Fiscal 2005").
The Company's Board of Directors has also recommended their appointment for the
fiscal year ending September 30, 2005.
The Audit Committee also approved a resolution restricting the
utilization of BKD LLP for certain non-audit matters other than tax and merger
and acquisition related services. The Board of Directors also adopted a policy
prohibiting the Company from hiring BKD LLP personnel at the management or
partner level who have been directly involved in performing auditing procedures
or providing accounting advice to the Company.
A representative of the firm of BKD LLP is expected to be present at
the meeting and will be available to respond to appropriate questions. They will
be given an opportunity to make a statement if they desire to do so.
ANNUAL REPORT
The Company's annual report for the year ended September 30, 2004 is
enclosed herewith.
A COPY OF THE COMPANY'S FORM 10-KSB ANNUAL REPORT TO THE SECURITIES AND EXCHANGE
COMMISSION, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO, MAY BE
OBTAINED WITHOUT CHARGE BY WRITING TO:
SiriCOMM, Inc.
2900 Davis Boulevard, Suite 130
Joplin, MO 64804
STOCKHOLDER PROPOSALS
Stockholders that intend to present proposals at the next annual
meeting to be held in 2006 must submit their proposals to the Secretary of the
Company by March 1, 2006 in order to have them included in the proxy for that
meeting.
15
OTHER BUSINESS
So far as is known to management at the date of this proxy statement,
there is no matter other that those described above to be acted on at the
meeting. However, it is intended that if other matters come up for action at the
meeting or any adjournments thereof, the persons named in the enclosed form of
proxy shall, in accordance with the terms of the proxy, have authority in their
discretion to vote shares represented by proxies received by them, in regard to
such other matters, as seems to said persons in the best interests of the
Company and its stockholders.
SIRICOMM, INC.
J. Richard Iler
Secretary
16
[FRONT]
PROXY
SIRICOMM, INC.
2900 Davis Boulevard, Suite 130
Joplin, Missouri 64804
This Proxy is solicited on behalf of the Board of Directors
The undersigned hereby appoints Henry P. Hoffman and J. Richard Iler as
proxies, each with the power to appoint his substitute, and hereby authorizes
them to vote, as designated on the reverse side, all of the shares of common
stock of SiriCOMM, Inc. held of record by the undersigned on March 24, 2005, at
the annual meeting of stockholders to be held on May 11, 2005 or any adjournment
thereof.
[BACK]
This proxy when properly executed will be voted in the manner directed herein by
the undersigned stockholder. If no direction is given, this proxy will be voted
FOR Proposals 1 and 2.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
1. ELECTION OF DIRECTORS
Nominees: Henry P. (Hank) Hoffman, David N. Mendez, Kory S. Dillman,
J. Richard Iler, Terry W. Thompson and William P. Moore
FOR WITHHELD
all nominees from all nominees
FOR, except vote withheld from the following nominee(s):
2. To ratify the selection of BKD LLP to serve as the Company's independent
certified public accountants.
For [ ] Against [ ] Abstain [ ]
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
Please sign exactly as name appears hereon. When shares are by joint tenants,
both should sign. When signing as attorney, executor, trustee, administrator 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.
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Signature Date