DEF 14A: Definitive proxy statements
Published on September 24, 2001
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934
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[_] Preliminary Proxy Statement
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[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
ResMed Inc.
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(Name of Registrant as Specified In Its Charter)
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Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of ResMed
Inc., at 4:00 p.m. local time, on Monday, November 5, 2001, at our executive
offices, located at 14040 Danielson Street, Poway, California.
Information about the business of the meeting and the nominees for election as
directors are set forth in the Notice of Meeting and the Proxy Statement, which
are attached. This year you are asked to elect two Directors of the Company, and
to ratify the selection of our independent auditors for fiscal year 2002.
Very truly yours,
Peter C. Farrell
Chairman and Chief Executive Officer
RESMED INC
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOVEMBER 5, 2001
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The 2001 Annual Meeting of Shareholders of ResMed Inc. will be held at our
executive offices at 14040 Danielson Street, Poway, California on November 5,
2001, at 4:00 p.m. local time for the following purposes:
1. To elect two directors, each to serve for a three year term;
2. To ratify the selection of KPMG LLP as our independent auditors to examine
our consolidated financial statements for the fiscal year ending June 30,
2002; and
3. To transact such other business as may properly come before the meeting.
Please refer to the accompanying proxy statement for a more complete description
of the matters to be considered at the meeting. Only shareholders of record at
the close of business on September 7, 2001, will be entitled to notice of, and
to vote at, the 2001 Annual Meeting and any adjournment thereof.
It is important that your shares be represented at the annual meeting. Even if
you plan to attend the annual meeting in person, please sign, date and return
your proxy form in the enclosed envelope as promptly as possible. This will not
prevent you from voting your shares in person if you attend, but will make sure
that your shares are represented in the event that you cannot attend.
Please sign, date and return the enclosed proxy promptly in the envelope
provided, which requires no United States postage.
By Order of the Board of Directors,
Walter Flicker
Secretary
Dated: September 20, 2001
RESMED INC.
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PROXY STATEMENT
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Annual Meeting of Shareholders to be held November 5, 2001
General
The enclosed proxy is solicited on behalf of the Board of Directors of ResMed
Inc. for use at the 2001 Annual Meeting of Shareholders to be held at 4:00 p.m.
on Monday, November 5, 2001, at our principal executive offices located at 14040
Danielson Street, Poway, California, and at any and all adjournments and
postponements thereof for the following purposes:
1. To elect two directors, each to serve for a three year term;
2. To ratify the selection of KPMG LLP as our independent auditors to examine
our consolidated financial statements for the fiscal year ending June 30,
2002; and
3. To transact such other business as may properly come before the meeting.
The enclosed proxy may be revoked at any time before its exercise by giving
written notice of revocation to our Secretary. The shares represented by proxies
in the form solicited by the Board of Directors received by us prior to or at
the meeting will be voted at the meeting. If a choice is specified on the proxy
with respect to a matter to be voted upon, the shares represented by the proxy
will be voted in accordance with that specification. If no choice is specified,
the shares will be voted as stated below in this proxy statement.
It is expected that this proxy statement and the accompanying form of proxy will
first be mailed to our shareholders on or about September 27, 2001. Our Annual
Report to Shareholders for Fiscal 2001 is enclosed with this proxy statement
along with a copy of our Annual Report to the Securities and Exchange Commission
on Form 10K, but they do not form a part of the proxy soliciting material. The
cost of soliciting proxies will be borne by us. Following the original mailing
of the proxy soliciting material, further solicitation of proxies may be made by
mail, telephone, facsimile and personal interview by our regular employees, who
will not receive additional compensation for such solicitation. We may also
request brokerage firms and other nominees or fiduciaries to forward copies of
the proxy soliciting material and the 2001 Annual Report to beneficial owners of
the stock held in their names, and we will reimburse them for reasonable
out-of-pocket expenses incurred in doing so.
Voting Securities and Voting Rights
Only recordholders of our common stock as of the close of business on September
7, 2001 (the "record date") are entitled to receive notice of and to vote at the
meeting. At the record date, we had 31,870,060 outstanding shares of common
stock, the holders of which are entitled to one vote per share. Accordingly, an
aggregate of 31,870,060 votes may be cast on each matter to be considered at the
meeting.
In order to constitute a quorum for the conduct of business at the meeting, a
majority of the outstanding shares entitled to vote at the meeting must be
represented at the meeting. Shares represented by proxies that reflect
abstentions or "broker non-votes" (i.e., shares held by a broker or nominee
which are represented at the meeting, but with respect to which such broker or
nominee is not empowered to vote on a particular proposal) will be counted as
shares represented at the meeting for purposes of determining a quorum. Assuming
a quorum is present, directors will be elected by a favorable vote of a
plurality of the aggregate votes cast, in person or by proxy, at the meeting.
The proposal to ratify the selection of our
independent auditors requires the affirmative vote of a majority of the
aggregate votes cast, in person or by proxy, at the meeting. Accordingly,
abstentions and broker non-votes will have no effect on the outcome of the
election of candidates for director or the outcome of the ratification of KPMG
LLP as our independent auditors. In addition, a simple majority of the shares
voting may elect all of the directors.
Common Stock Ownership of Principal Shareholders and Management
The following table shows the number of shares of common stock which, according
to information supplied to us, are beneficially owned by (i) each person who, to
our knowledge based exclusively on Schedules 13G filed with the Securities and
Exchange Commission, is the beneficial owner of more than five percent of our
outstanding common stock, (ii) each person who is currently a director, two of
whom are also nominees for election as directors, (iii) each of the Named
Officers as defined on page 3 hereof, and (iv) all current directors and
executive officers as a group. As used herein, "beneficial ownership" means the
sole or shared power to vote, or to direct the voting of, a security, or the
sole or shared investment power with respect to a security (i.e., the power to
dispose of, or to direct the disposition of, a security). A person is deemed, as
of any date, to have "beneficial ownership" of any security that the person has
the right to acquire within 60 days after that date.
(1) The address of the directors and officers listed in this table is 14040
Danielson Street, Poway, California, 92064-6857.
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(2) Except for the information based on Schedules 13G as indicated in the
footnotes hereto, beneficial ownership is stated as of September 7, 2001
and includes shares subject to options exercisable within 60 days after
September 7, 2001.
(3) Based on disclosure by Commonwealth Bank of Australia, CBA has shared
dispositive power and shared voting power and beneficial ownership over
these shares.
(4) Based on Schedule 13G filed by Deutsche Bank AG, Deutsche Bank has shared
dispositive power and shared voting power and beneficial ownership over
these shares.
(5) Based on disclosure by Principal Financial Group, Principal has sole
dispositive and sole voting power and beneficial ownership over these
shares.
(6) Includes 171,163 shares of common stock which may be acquired upon the
exercise of options exercisable within 60 days after September 7, 2001.
(7) Includes 5,800 shares held by his wife, 275,200 shares held of record by
Cabbit Pty Ltd and 34,000 shares held by Acemed Pty Ltd, two Australian
corporations controlled by Dr. Roberts and his wife. Includes 80,000 shares
of common stock which may be acquired upon the exercise of options
exercisable within 60 days after September 7, 2001.
(8) Includes 15,999 shares of common stock which may be acquired upon the
exercise of options exercisable within 60 days after September 7, 2001.
(9) Includes 17,701 shares of common stock which may be acquired upon the
exercise of options exercisable within 60 days after September 7, 2001.
(10) Includes 90,000 shares of common stock which may be acquired upon the
exercise of options exercisable within 60 days after September 7, 2001.
(11) Includes 7,000 shares of common stock which may be acquired upon the
exercise of options exercisable within 60 days after September 7, 2001.
(12) Includes 25,834 shares of common stock which may be acquired upon the
exercise of options exercisable within 60 days after September 7, 2001.
(13) Includes 16,929 shares of common stock which may be acquired upon the
exercise of options exercisable within 60 days after September 7, 2001.
(14) Includes 83,332 shares held by his wife and 62,267 shares of common stock
which may be acquired upon the exercise of options exercisable within 60
days after September 7, 2001.
(15) Includes, in addition to the shares described in notes 6 through 14 above,
179,600 outright shares and 128,168 shares of common stock which may be
acquired upon the exercise of options by the executive officers not named
in the table.
The information presented is based upon the knowledge of management and, in the
case of the named individuals, upon information furnished by them.
Executive Officers
Our executive officers, as of September 7, 2001 were:
For a description of the business background of Drs. Farrell and Roberts, see
"Matters to be Acted Upon/Election of Directors."
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Norman DeWitt has been our General Counsel since July 1999. Mr. DeWitt was
previously Corporate Counsel (U.S.) from October 1998 to June 1999; Vice
President, U.S. Marketing from August 1997 to September 1998; and Vice President
U.S. Operations from October 1994 to August 1997. Prior thereto, Mr. DeWitt held
various positions both as an attorney and executive for companies based in
Minneapolis, MN, and provided consulting services to us beginning in 1990. Mr.
DeWitt holds a B.A. from Amherst College, a J.D. from the University of
Minnesota Law School and a L.L.M. from William Mitchell College of Law.
Walter Flicker has been our Corporate Secretary since December 1989. Mr. Flicker
was Vice President, U.S. Operations from August 1997 to June 1999, Vice
President, Corporate Development from February 1995 to August 1997 and, from
December 1989 until February 1995, he served as our Vice President, Finance.
Prior thereto, he was an engineering consultant with Bio-Agrix Pty Ltd., a
biomedical engineering consulting company and a Business Development Manager at
Baxter Center for Medical Research Pty Ltd., a subsidiary of Baxter
International, Inc. Mr. Flicker holds a B.E. with Honors in mechanical
engineering and a Master's in Biomedical Engineering from the University of New
South Wales.
Adrian Smith has been our Chief Financial Officer since February 1995. From
January 1986 through January 1995, Mr. Smith was employed by Price Waterhouse,
specializing in the auditing of listed public companies in the medical and
scientific field. Mr. Smith holds a B.Ec. from Macquarie University and is a
Certified Chartered Accountant.
Curt Kenyon has been our Senior Vice President, Sales and Marketing for the
United States, Canada and Latin America since 1999. From 1997 to 1999, he held
the position of Vice President, U.S. Sales. Between 1995 and 1997, he was the
Director of U.S. Sales and between 1994 and 1995, he held the position of
Eastern Region Sales Manager. Prior to his employment with us, Mr. Kenyon was a
Regional Sales Manager for EMPI Inc. and Medtronic, both of Minneapolis, MN. Mr.
Kenyon holds a B.A. in Design and Planning with a concentration in Business
Administration from State University of New York at Buffalo, where he was a cum
laude graduate.
Klaus Schindhelm, Ph.D., has been our Vice President, Operations since January
2000. Dr. Schindhelm was Vice President, Product Development, from July 1998 to
December 1999. From January 1995 to June 1998 Dr. Schindhelm was Professor and
Head, Graduate School of Biomedical Engineering, University of New South Wales
and from January 1990 to August 1994, Director, Centre for Biomedical
Engineering, University of New South Wales. Prior thereto, Dr. Schindhelm held
various academic positions in Biomedical Engineering at the University of New
South Wales. Dr. Schindhelm received a B.E. and a Ph.D. in Chemical Engineering
from the University of New South Wales.
Deirdre Stewart, Ph.D., has been our Vice President of Clinical Education and
New Business since early 2000. From 1999 to 2000, she held the position of Vice
President of Marketing and Education, and from 1997 to 1999 she was the Vice
President of Education and Training. Prior to joining ResMed in 1993, Dr.
Stewart was a clinical researcher at Sydney University where she completed her
Ph.D. in Physiology in sleep disordered breathing. Dr. Stewart is a registered
nurse and holds a B.A. from the University of New South Wales.
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Executive Compensation
The following table sets forth certain information regarding the annual and
long-term compensation for services rendered to us in all capacities for the
fiscal years ended June 30, 2001, 2000 and 1999 of those persons who were at
June 30, 2001 (i) the chief executive officer, (ii) one of the four other most
highly compensated executive officers whose annual salary and bonuses exceeded
$100,000 or (iii) any other executive officer who would have qualified under
sections (i) or (ii) of this paragraph but for the fact that the individual was
not serving as an executive officer of the registrant at the end of the 2001
fiscal year (collectively, the "Named Officers").
(1) Represents cash value of company provided vehicle
(2) Represents pension plan payments
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Stock Options
(1) Represents options granted under our 1997 Equity Participation Plan, which
are exercisable starting 12 months after the grant date, with 33% of the
shares covered thereby becoming exercisable at that time and an additional
33% of the option shares becoming exercisable on each successive
anniversary date, with all option shares exercisable beginning on the third
anniversary date. Under the terms of the 1997 Plan, this exercise schedule
may be accelerated in certain specific situations.
(2) Assumed annual rates of stock appreciation for illustrative purposes only.
Actual stock prices will vary from time to time based upon market factors
and our financial performance. No assurance can be given that such rates
will be achieved.
The following table sets forth information concerning the stock option exercises
by our Chief Executive Officer and Named Officers during the fiscal year ended
June 30, 2001 and the unexercised stock options held at June 30, 2001 by the
named officers.
(1) Represents the amount by which the closing sales price of our common stock
on the New York Stock Exchange on June 29, 2001 ($50.55 per share)
multiplied by the number of shares to which the options apply exceeded the
aggregate exercise price of such options.
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Report of the Stock Option and Compensation Committee
Introduction
Decisions regarding compensation of the Company's officers generally are made
based on recommendations by the Stock Option and Compensation Committee, which
is composed of two independent outside Directors. The Stock Option and
Compensation Committee decisions on compensation of the Company's executive
officers are reviewed and approved by the full Board. Set forth below is a
report submitted by Messrs. Donagh McCarthy and Michael A. Quinn in their
capacity as members of the Board's Stock Option and Compensation Committee
addressing the Company's compensation policies for fiscal year 2001 as they
affected executive officers of the Company, including the Chief Executive
Officer and the Named Officers.
General Philosophy
The Stock Option and Compensation Committee reviews and determines salaries,
bonuses and all other elements of the compensation packages offered to the
executive officers of the Company, including its Chief Executive Officer, and
establishes the general compensation policies of the Company.
The Company desires to attract, motivate and retain high quality employees who
will enable the Company to achieve its short and long term strategic goals and
values. The Company participates in a high-growth environment where substantial
competition exists for skilled employees. The ability of the Company to attract,
motivate and retain high caliber individuals is dependent in large part upon the
compensation packages it offers.
The Company believes that its executive compensation programs should reflect the
Company's financial and operating performance. In addition, individual
contribution to the Company's success should be supported and rewarded.
The 1993 Omnibus Budget Reconciliation Act ("OBRA") became law in August 1993.
Under the law, income tax deductions of publicly-traded companies in tax years
beginning on or after January 1 1994 may be limited to the extent total
compensation (including base salary, annual bonus, stock option exercises, and
non-qualified benefits) for certain executive officers exceeds $1 million (less
the amount of any "excess parachute-payments" as defined in Section 280G of the
Code) in any one year. Under OBRA, the deduction limit does not apply to
payments which qualify as "performance-based". To qualify as
"performance-based," compensation payments must be based solely upon the
achievement of objective performance goals and made under a plan that is
administered by a committee of outside directors. In addition, the material
terms of the plan must be disclosed to and approved by shareholders, and the
Stock Option and Compensation Committee must certify that the performance goals
were achieved before payments can be made.
The Committee intends to design the Company's compensation programs to conform
with the OBRA legislation and related regulations so that total compensation
paid to any employee will not exceed $1 million in any one year, except for
compensation payments which qualify as "performance-based." The Company may,
however, pay compensation which is not deductible in limited circumstances when
sound management of the Company so requires.
The Company's executive and key employee compensation program consists of a base
salary component, a component providing the potential for an annual bonus based
on overall Company performance and a component providing the opportunity to earn
stock options linking the employee's long-term financial success to that of the
shareholders.
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Compensation
Base Salary
Officers are compensated with salary ranges that are generally based on similar
positions in companies of comparable size and complexity to the Company. In
addition, the Company utilizes industry compensation surveys in determining
compensation. The primary level of compensation is based on a combination of
years of experience and performance. The salary of all officers is reviewed
annually with the amount of the increases based on factors such as Company
performance, general economic conditions, marketplace compensation trends and
individual performance.
In fiscal year 2001, the Board approved salary increases for the named officers
as follows:
Peter C. Farrell ................. 10%
Christopher G. Roberts ................. 10%
Norman W. DeWitt ................. 12%
Curt Kenyon ................. 14%
Deirdre Stewart ................. 14%
Bonus
The second compensation component is a bonus program under the Company's Bonus
Plan. Bonuses are primarily based on the Company's annual financial performance
and secondarily on the performance of the individual. Target bonuses generally
range from 40% to 60% of base salary. The measures of annual financial
performance used in determining the amount of bonuses include sales growth and
cost control.
Stock Options
The third major component of the officer's compensation consists of stock
options. The primary purpose of granting stock options is to link the officers'
financial success to that of the shareholders of the Company. The exercise price
of stock options is determined by the Stock Option and Compensation Committee at
the time the option is granted, but generally may not be less than the
prevailing market price of the Company's common stock as of the date of grant.
Options become exercisable commencing a minimum of twelve months from the date
of grant and are exercisable for a maximum period of 10 years, as determined by
the Stock Option and Compensation Committee.
Stock options were issued to Officers of the Company during fiscal year 2001 in
accordance with the provisions of the Company's 1997 Equity Participation Plan.
CEO Compensation
The compensation of Dr. Farrell is based upon the performance of the Company and
the important role Dr. Farrell plays within the Company as its founder,
President and Chief Executive Officer, as a member of the boards of the
Company's principal subsidiaries and as an active participant in new product and
corporate development.
Stock Option and Compensation Committee of the Company's Board of Directors:
Donagh McCarthy (Chairman)
Michael A Quinn
Dated: August 29, 2001
The above report of the Stock Option and Compensation Committee will not be
deemed to be incorporated by reference to any filing by the Company under the
Securities Act of 1933 or the Securities Exchange Act of 1934, except to the
extent that the Company specifically incorporates the same by reference.
Stock Option and Compensation Committee Interlocks and Insider Participation
8
The Stock Option and Compensation Committee of the Board of Directors is
responsible for executive compensation decisions as described above under "Board
of Directors and Committees of the Board." During fiscal year 2001, the
committee consisted of Mr. Donagh McCarthy (Chairman) and Mr. Michael A. Quinn.
Dr. Farrell did not participate in discussions or decisions regarding his
compensation package.
Performance Graph
Set forth below is a line graph comparing the cumulative shareholder return on
our common stock against the cumulative total return of the S&P 500 Index and
the S&P Medical Products and Supplies Index for the period commencing June 30,
1996, assuming an investment of $100 on June 30, 1996.
[GRAPH]
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires our directors and
officers, and persons who own more than ten percent of a registered class of our
equity securities, to file with the Securities and Exchange Commission, or the
Commission, initial reports of ownership and reports of change in ownership of
our common stock and other equity securities. Officers, directors and greater
than ten-percent shareholders who are affiliates of the Company are required by
Commission regulation to furnish us with copies of all Section 16(a) forms they
file.
Based solely on our review of copies of such forms received by the Company with
respect to Fiscal 2001, or written representations from certain reporting
persons, we believe that during Fiscal 2001 all of our directors and executive
officers and persons who own more than 10% of our common stock have complied
with the reporting requirements of Section 16(a) except: Adrian Smith filed a
late Form 4 disclosing the exercise and sale of 20,000 options; Curt Kenyon
filed a late Form 5 for fiscal year 2001,
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disclosing a grant of 13,500 options; Gary Pace filed a late Form 5 for fiscal
year 2001 disclosing a grant of 16,000 options; Michael Quinn filed a late Form
5 for fiscal year 2001 disclosing a grant of 16,000 options; and Donagh McCarthy
filed a late Form 5 for fiscal year 2001 disclosing a grant of 16,000 options.
Audit Committee Report
The Audit Committee of the Company's Board of Directors is comprised of
independent directors as required by the listing standards of the New York Stock
Exchange. The members of the Audit Committee are Michael A. Quinn, Donagh
McCarthy and Gary Pace. The Audit Committee operates pursuant to a written
charter adopted by the Board of Directors.
The role of the Audit Committee is to oversee the Company's financial reporting
process on behalf of the Board of Directors. Management of the Company has the
primary responsibility for the Company's financial statements as well as the
Company's financial reporting process, principles and internal controls. The
independent auditors are responsible for performing an audit of the Company's
financial statements and expressing an opinion as to the conformity of such
financial statements with generally accepted accounting principles.
In this context, the Audit Committee has reviewed and discussed the audited
financial statements of the Company as of and for the year ended June 30, 2001
with management and the independent auditors. The Audit Committee has discussed
with the independent auditors the matters required to be discussed by Statement
on Auditing Standards No. 61 (Communication with Audit Committees), as currently
in effect. In addition, the Audit Committee has received the written disclosures
and the letter from the independent auditors required by Independence Standards
Board Standard No. 1 (Independence Discussions with Audit Committees), as
currently in effect, and it has discussed with the auditors their independence
from the Company.
The members of the Audit Committee are not engaged in the accounting or auditing
profession and, consequently, are not experts in matters involving auditing or
accounting. In the performance of their oversight function, the members of the
Audit Committee necessarily relied upon the information, opinion, reports and
statements presented to them by management of the Company and by the independent
auditors. As a result, the Audit Committee's oversight and the review and
discussions referred to above do not assure that management has maintained
adequate financial reporting processes, principles and internal controls, that
the Company's financial statements are accurate, that the audit of such
financial statements has been conducted in accordance with generally accepted
auditing standards or that the Company's auditors meet the applicable standards
for auditor independence.
Based on the reports and discussions described 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-K for the year ended June 30,
2001, for filing with the Securities and Exchange Commission.
Michael A. Quinn (Chairman)
Donagh McCarthy
Gary Pace
MATTERS TO BE ACTED UPON
Proposal 1. Election of Directors
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The Board of Directors, acting pursuant to our bylaws, has determined that
the number of directors constituting the full Board of Directors shall be
six at the present time.
The Board is divided into three classes. One such class is elected every
year at the Annual Meeting of Shareholders for a term of three years. The
class of directors whose term expires in 2001 has two members, Michael A.
Quinn and Christopher Bartlett. Accordingly, two directors are to be
elected at the 2001 Annual Meeting of Shareholders, who will hold office
until the 2004 Annual Meeting of Shareholders or until the director's prior
death, disability, resignation or removal.
The Board of Directors has nominated Michael A. Quinn and Christopher
Bartlett, Ph.D. for re-election as directors. Proxies are solicited in
favor of these nominees and will be voted for them unless otherwise
specified. If Mr. Quinn and Dr. Bartlett become unable or unwilling to
serve as directors, 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.
Information concerning the nominees for director and the other directors
who will continue in office after the meeting is set forth below:
(1) Term expires 2001
(2) Term expires 2002
(3) Term expires 2003
(4) Member of Audit Committee
(5) Member of Stock Option and Compensation Committee
Peter C. Farrell, Ph.D., has been our President and a director since our
inception in June 1989 and our Chief Executive Officer since July 1990.
From July 1984 to June 1989, Dr. Farrell served as Vice President, Research
and Development at various subsidiaries of Baxter International, Inc.
("Baxter") and from August 1985 to June 1989, he also served as Managing
Director of the Baxter Center for Medical Research Pty Ltd., a subsidiary
of Baxter. From January 1978 to December 1989, he was Foundation Director
of the Center for Biomedical Engineering at the University of New South
Wales where he currently serves as a Visiting Professor. He holds a B.E. in
chemical engineering with Honors from the University of Sydney, an S.M. in
chemical engineering from the Massachusetts Institute of Technology, a
Ph.D. in chemical engineering and bioengineering from the University of
Washington, Seattle and a D.Sc. from the University of New South Wales. Dr.
Farrell was named 1998 San Diego Entrepreneur of the Year for Health
Sciences. In August 2000, he was named Vice Chairman of the Executive
Council of the Harvard Medical School Division of Sleep Medicine.
Christopher G. Roberts, Ph.D., joined us in August 1992 as Executive Vice
President. He has been one of our directors since September 1992. He also
served as a director from August 1989 to November 1990. In addition to his
responsibilities with ResMed, Dr. Roberts is Chairman of Sirtex Medical
Limited (ASX: ticker SRX), a medical device company commercializing
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innovative technology for the treatment of liver cancer. From February 1989
to June 1992, Dr. Roberts served in various positions, most recently as
Vice President-Clinical and Regulatory Affairs, with medical device
subsidiaries of Pacific Dunlop Limited, a large multinational manufacturing
company. From January 1984 to December 1988, he served as President of BGS
Medical Corporation, a medical device company which was acquired in
September 1987 by Electro Biology Inc. ("EBI"), at which time he became
Vice President-Clinical and Regulatory Affairs of EBI. Dr. Roberts holds a
B.E. in chemical engineering with honors from the University of New South
Wales, a M.B.A. from Macquarie University and a Ph.D. in biomedical
engineering from the University of New South Wales.
Donagh McCarthy has served as one of our directors since November 1994. Mr.
McCarthy is currently the President and CEO of Protiveris Inc., a Maryland
based biotechnical startup Company. From September 1996 to January 2000, he
was President of RMS Inc., an affiliate of Baxter Healthcare. From June
1993 until September 1996, he was the President of the North America Renal
Division of Baxter. Mr. McCarthy held various positions at Baxter since
1982, including that of Vice President-Global Marketing, Strategy and
Product Development. Mr. McCarthy received a bachelor's degree in
engineering from the National University of Ireland and a M.B.A. from the
Wharton School, University of Pennsylvania.
Gary W. Pace, Ph.D., has served as one of our directors since July 1994.
Dr. Pace is President and Chief Executive Officer of RTP Pharma Corp.
(formerly Research Triangle Pharmaceutical Ltd.), a biopharmaceutical
company working in the area of drug delivery, since January 1995. From
January 1993 to September 1994, he was the founding President and Chief
Executive Officer of Transcend Therapeutics Inc. (formerly Free Radical
Sciences Inc.), a biopharmaceutical company. From September 1989 to January
1993, he was Senior Vice President of Clintec International, Inc., a
Baxter/Nestle joint venture and manufacturer of clinical nutritional
products. Dr. Pace holds a B.Sc. with Honors from the University of New
South Wales and a Ph.D. from the Massachusetts Institute of Technology.
Michael A. Quinn has served as one of our directors since September 1992.
Since April 1999, Mr. Quinn has been the Chief Executive Officer of
Innovation Capital, an Australian/U.S. venture capital fund. From February
1992 to April 1999, he was a management and financial consultant. From July
1988 to January 1992, he served as Executive Chairman of Phoenix Scientific
Industries Limited, a manufacturer of health care and scientific products.
Mr. Quinn holds a B.Sc. in physics and applied mathematics and a B.Ec. from
the University of Western Australia and a M.B.A. from Harvard University.
Christopher Bartlett, Ph.D., has served as one of our directors since
October 2000, and holds the Casserly Chair of Business Administration,
Program for Global Leadership, at Harvard Business School. Professor
Bartlett has both masters and doctorate degrees in business administration
from Harvard University. Prior to joining the faculty of Harvard Business
School, he was a marketing manager with Alcoa in Australia, a management
consultant in McKinsey's, London office, and general manager at Baxter
Laboratories' subsidiary company in France. He is also a graduate of the
University of Queensland.
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Committees of the Board of Directors
The Board of Directors has two committees to assist in the management of
our affairs: the Stock Option and Compensation Committee and the Audit
Committee. We do not have a standing Nominating Committee.
Stock Option and Compensation Committee; Audit Committee
The Stock Option and Compensation Committee currently consists of Messrs.
Donagh McCarthy (Chairman) and Michael A Quinn. The Stock Option and
Compensation Committee administers our 1995 Option Plan and 1997 Equity
Participation Plan and has the authority to grant options under the latter
plan. The Stock Option and Compensation Committee also makes
recommendations regarding the compensation payable, including compensation
under the Company's bonus plan, to our senior executive officers.
The Audit Committee currently consists of Messrs. Michael A. Quinn
(Chairman), Donagh McCarthy and Gary Pace. This committee assists the Board
in fulfilling its functions relating to corporate accounting and reporting
practices and financial and accounting controls.
The Stock Option and Compensation Committee met twice and the Audit
Committee met four times during fiscal year 2001. These committees also met
informally by telephone during the fiscal year as the need arose. The Board
of Directors held 4 meetings during fiscal year 2001.
Each director attended 100% of the aggregate of the total number of
meetings of the Board of Directors held during such period and the total
number of meetings held during such period by the committees of the Board
of Directors on which that director served.
Each director who is not an employee received an annual fee of $10,000 for
his service as a director during fiscal 2001. In addition, each director is
reimbursed for his travel expenses for attendance at all such meetings.
Directors who are not employees also hold and receive stock options under
our 1995 Option Plan and 1997 Equity Participation Plan. During fiscal year
2001, the directors received 16,000 stock options each at an exercise price
of $26.562.
Medical Advisory Committee
In addition we have an independent Medical Advisory Committee. The Medical
Advisory Committee comprises leading physicians in sleep medicine who
advise the board with respect to reviewing our current and proposed product
lines from a medical perspective.
Required Vote
Assuming a quorum is present, directors will be elected by a favorable vote
of a plurality of the aggregate votes cast, in person or by proxy, at the
meeting. Accordingly, abstentions and broker non-votes will have no effect
on the outcome of the election of candidates for director. In addition, a
simple majority of the shares voting may elect all of the directors.
Unless instructed to the contrary, the shares represented by the proxies
will be voted FOR the election of the nominees named above as directors.
Although it is anticipated that the nominees will be able to serve as
directors, should a nominee become unavailable to serve, the proxies will
be voted for such other person or persons as may be designated by our Board
of Directors.
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THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE ELECTION OF
EACH NOMINEE TO THE BOARD OF DIRECTORS.
Proposal 2. Ratification of Selection of Auditors
-------------------------------------
The firm of KPMG LLP, our independent auditors for the fiscal year ended
June 30, 2001, was selected by the Board of Directors, upon recommendation
of the Audit Committee, to act in the same capacity for the fiscal year
ending June 30, 2002. Neither the firm nor any of its members has any
relationship with us nor any of our affiliates except in the firm's
capacity as our auditor.
Representatives of KPMG LLP are expected to be present at the meeting and
will have the opportunity to make statements if they so desire and respond
to appropriate questions from the shareholders.
Audit Fees
The aggregate fees billed for professional services rendered by KPMG LLP
for the audit of our annual financial statements for the 2001 fiscal year
and the reviews of the financial statements included in our Quarterly
Reports on Form 10-Q for the 2001 fiscal year were $161,393.
Financial Information Systems Design and Implementation Fees
KPMG LLP did not render any professional services to us of the type
described in Rule 2-01(c)(4)(ii) of Regulation S-X during the 2001 fiscal
year.
All Other Fees
The aggregate fees billed for services rendered by KPMG LLP, other than
fees for the services referenced under the captions "Audit Fees" and
"Financial Information Systems Design and Implementation Fees," during the
2001 fiscal year were $36,486, including audit-related services of $10,282
and non-audit services of $26,204.
Required Vote
The proposal to ratify the selection of our independent auditors requires
the affirmative vote of a majority of the aggregate votes cast, in person
or by proxy, at the meeting. Accordingly, abstentions and broker non-votes
will have no effect on the outcome of the ratification of KPMG LLP as our
independent auditors.
Unless instructed to the contrary, properly executed proxies will be voted
FOR ratification of the selection of KPMG LLP as our independent auditors.
Your Board of Directors recommends a vote "FOR" approval of the
ratification of the selection of KPMG LLP as our independent auditors.
Proposal 3. Other Business
--------------
The Board of Directors does not know of any other business to be presented
to the Annual Meeting of Shareholders. If any other matters properly come
before the meeting, however, the
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persons named in the enclosed form of proxy will vote the proxy in
accordance with their best judgment.
SHAREHOLDER PROPOSALS FOR 2002 ANNUAL MEETING
We expect to hold our 2002 Annual Meeting of Shareholders on November 4, 2002.
In order for shareholder proposals otherwise satisfying the eligibility
requirements of Rule 14a-8 under the Exchange Act to be considered for inclusion
in our Proxy Statement for our 2002 Annual Meeting, they must be received by us
at our principal office in Poway, California, on or before May 31, 2002.
In addition, if a shareholder desires to bring business (including director
nominations) before our 2002 Annual Meeting of Shareholders that is not the
subject of a proposal timely submitted for inclusion in our Proxy Statement as
described above, written notice of such business must be received by our
Secretary at our principal office in Poway, California, on or before August 14,
2002. If such notice is not received by August 14, 2002, such notice will be
considered untimely under Rule 14a-4(c)(1) of the Commission's proxy rules, and
we will have discretionary voting authority under proxies solicited for the 2002
Annual Meeting of Shareholders with respect to such proposal, if presented at
the meeting.
By Order of the Board of Directors
Walter Flicker
Secretary
Dated: September 20, 2001
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Please date, sign and mail your
Proxy card back as soon as possible!
Annual Meeting of Shareholders
ResMed Inc.
November 5, 2001
. Please Detach and Mail in the Envelope Provided .