For
the month of,
|
April
|
2009
|
|
Commission
File Number
|
001-14620
|
||
Pan
American Silver Corp
|
|||
(Translation
of registrant’s name into English)
|
|||
1500-625
Howe Street, Vancouver BC Canada V6C 2T6
|
|||
(Address
of principal executive offices)
|
Form
20-F
|
Form
40-F
|
X
|
|
Yes
|
No
|
X
|
|
Document
|
|
1
|
Information
Circular, dated April 7, 2009
|
2
|
Form of Proxy |
NOTICE
OF ANNUAL GENERAL MEETING
|
i
|
INFORMATION
CIRCULAR
|
1
|
Solicitation
of Proxies
|
1
|
Appointment
of Proxyholder
|
1
|
Revocation
of Proxy
|
2
|
Voting
by Non-Registered Shareholders
|
2
|
Voting
of Proxies
|
3
|
Exercise
of Discretion
|
3
|
Voting
Securities and Principal Holders of Voting Securities
|
4
|
Quorum
and Votes Necessary
|
4
|
Particular
Matters to be Acted Upon
|
4
|
Election of
Directors
|
4
|
Appointment of
Auditors
|
7
|
Corporate
Governance
|
7
|
Composition of the
Board
|
8
|
Board Committees
|
8
|
Summary of Attendance of
Directors
|
11
|
Code of Ethical
Conduct
|
12
|
Directors’
and Officers’ Liability Insurance
|
12
|
Executive
Compensation
|
13
|
Summary Compensation
Table
|
13
|
Long-Term Incentive
Plan
|
13
|
Stock Options
|
14
|
Termination of Employment, Change
in Responsibilities and Employment Contracts
|
16
|
Share Ownership
|
17
|
Compensation
Committee
|
17
|
Report on Executive
Compensation
|
17
|
Chief Executive Officer
Compensation
|
19
|
Compensation of
Directors
|
21
|
Equity Compensation Plan
Information
|
22
|
Performance Graph
|
23
|
Interest
of Insiders in Material Transactions
|
23
|
Management
Contracts
|
24
|
Interest
of Certain Persons in Matters to be Acted Upon
|
24
|
Other
Matters
|
24
|
Additional
Information
|
24
|
Approval
of this Circular
|
24
|
APPENDIX
“A” – Corporate Governance Disclosure
|
A-1
|
1.
|
to
receive and consider the consolidated financial statements of the Company
for the financial year ended December 31, 2008, together with the
auditors’ report thereon;
|
2.
|
to
elect directors of the Company;
|
3.
|
to
reappoint Deloitte & Touche LLP, Chartered Accountants, as auditors of
the Company to hold office until the next annual general
meeting;
|
4.
|
to
authorize the directors of the Company to fix the remuneration to be paid
to the auditors of the Company;
|
5.
|
to
consider amendments to or variations of any matter identified in this
Notice of Meeting; and
|
6.
|
to
transact such further and other business that does not have a material
effect on the business of the Company as may be properly brought before
the Meeting or any and all adjournments
thereof.
|
BY
ORDER OF THE BOARD
|
|
/s/
ROBERT PIROOZ
|
|
Robert
Pirooz,
|
|
General
Counsel, Secretary and
Director
|
|
(a)
|
in
the name of an intermediary (an “Intermediary”) that the
Non-Registered Holder deals with in respect of the Shares, such as a bank,
trust company, securities dealer or broker or trustee or administrator of
self-administered RRSPs, RRIFs, RESPs or similar plans;
or
|
|
(b)
|
in
the name of a depository (such as The Canadian Depository for Securities
Limited) of which the Intermediary is a
participant.
|
|
(a)
|
receive,
as part of the Meeting Materials, a voting instruction form which must be
completed, signed and delivered by the Non-Registered Holder in accordance
with the directions provided by the Intermediary on the voting instruction
form (which may in some cases permit the completion of the voting
instruction form by telephone or through the internet);
or
|
|
(b)
|
be
given a form of proxy which has already been signed by the Intermediary
(typically by a facsimile, stamped signature), which is restricted to the
number of Shares beneficially owned by the Non-Registered Holder but which
is otherwise uncompleted. This form of proxy need not be signed
by the Non-Registered Holder. In this case, the Non-Registered
Holder who wishes to submit a proxy should otherwise properly complete
this form of proxy and deposit it as described
above.
|
Name,
Residence and
Position
|
Principal
Occupation,
Business or
Employment
Director
Since 2003
|
Number
of
Shares
Held
|
|
|
Ross
J. Beaty
Vancouver,
B.C.
Canada
Chairman
|
Chairman
of the Company; formerly Chief Executive Officer of the
Company.
Director
of the Company since September 30, 1988.
|
1,804,680
Shares (5)
197,900
Options
|
|
Geoffrey
A. Burns(4)
North
Vancouver, B.C.
Canada
President,
Chief Executive Officer and Director
|
President
and Chief Executive Officer of the Company; formerly Chief Financial
Officer of Coeur d’Alene Mines Corporation.
Director
of the Company since July 1, 2003.
|
21,587
Shares
86,762
Options
|
|
William
A. Fleckenstein(3)(7)
Seattle,
Washington
USA
Director
|
President
of Fleckenstein Capital, Inc. (investment counselling firm).
Director
of the Company since May 9, 1997.
|
3,013
Shares
8,438
Options
|
|
Michael
Larson(1)
Seattle,
Washington
USA
Director
|
Business
Manager of Cascade Investment, LLC (a private investment
company).
Director
of the Company since November 29, 1999.
|
2,214,452
Shares(6)
10,000
Options
|
Name,
Residence and
Position
|
Principal
Occupation,
Business or Employment
Director Since 2003
|
Number
of
Shares
Held
|
|
Michael
J.J. Maloney
(1)(2)(3)
Seattle,
Washington
USA
Director
|
Private
Investor.
Director
of the Company from Sept. 25, 1995 to November 29, 1999; and re-elected
March 2, 2000 to present.
|
62,412 Shares
0
Options
|
|
Robert
P. Pirooz(4)
Vancouver,
B.C.
Canada
General
Counsel, Secretary, and Director
|
General
Counsel and Secretary of the Company.
Director
of the Company since April 30, 2007.
|
4,207
Shares
54,440
Options
|
|
David
C. Press (2)(4)
West
Vancouver, B.C. Canada
Director
|
President,
Press Mining Consulting Inc.
Director
of the Company since May 13, 2008.
|
1,497 Shares
0 Options
|
|
Walter
T. Segsworth
West
Vancouver, B.C.
Canada
Director
|
Director
of Great Basin Gold Ltd.; Chairman of Plutonic Power Corporation; formerly
Chairman of Centenario Copper Corporation and of Cumberland Resources
Ltd.; and formerly Director of Northern Dynasty Minerals Ltd., UEX
Corporation and Yukon Zinc Corporation.
|
0 Shares
0
Options
|
|
Paul
B. Sweeney(1)(2)
Surrey,
B.C.
Canada
Director
|
Executive
Vice-President Corporate Development of Plutonic Power Corporation;
formerly Vice President and Chief Financial Officer of Canico Resource
Corp.
Director
of the Company since August 5, 1999.
|
10,255
Shares
0
Options
|
|
(1)
|
Member
of the Audit Committee.
|
(2)
|
Member
of the Compensation Committee.
|
(3)
|
Member
of the Nominating and Governance
Committee.
|
(4)
|
Member
of the Health Safety & Environment
Committee.
|
(5)
|
160,000
of these Shares are held by Kestrel Holdings Ltd., a private company owned
by Mr. Beaty.
|
(6)
|
Mr.
Larson exercises control or direction over 2,200,000 Shares on behalf of
Cascade Investment LLC, however beneficial ownership of such shares is
specifically disclaimed.
|
(7)
|
Lead
Independent Director. As Lead Independent Director, Mr.
Fleckenstein holds in-camera meetings with all independent directors of
the Board and reports back on those in-camera meetings to the
Board.
|
|
(a)
|
was
subject to an order that was issued while the proposed director was acting
in the capacity as director, chief executive officer or chief financial
officer; or
|
|
(b)
|
was
subject to an order that was issued after the proposed director ceased to
be a director, chief executive officer or chief financial officer and
which resulted from an event that occurred while that person was acting in
the capacity as director, chief executive officer or chief financial
officer.
|
|
(a)
|
any
penalties or sanctions imposed by a court relating to securities
legislation or by a securities regulatory authority or has entered into a
settlement agreement with a securities regulatory authority;
or
|
|
(b)
|
any
other penalties or sanctions imposed by a court or regulatory body that
would likely be considered important to a reasonable shareholder in
deciding whether to vote for a nominee as
director.
|
|
·
|
bookkeeping
or other services related to the accounting records or financial
statements of the Company;
|
|
·
|
financial
information systems design and implementation, except for services
provided in connection with the assessment, design and implementation of
internal account controls and risk management
controls;
|
|
·
|
appraisal
or valuation services, fairness opinions or contribution-in-kind reports,
where the results of any valuation or appraisal would be material to the
Company’s financial statements or where the accounting firm providing the
appraisal, valuation, opinion or report would audit the
results;
|
|
·
|
actuarial
services;
|
|
·
|
internal
audit outsourcing services;
|
|
·
|
management
functions or human resources
functions;
|
|
·
|
broker-dealer,
investment advisor or investment banking
services;
|
|
·
|
legal
services; and
|
|
·
|
expert
services unrelated to audits.
|
Year
ended December 31,
2008
(CAD$)
|
Year
ended December 31,
2007
(CAD$)
|
|||
Audit
Fees
|
$1,194,200
|
$1,331,800
|
||
Audit
Related Fees
|
nil
|
nil
|
||
Tax-Related
Fees
|
$45,200
|
$64,500
|
||
Other
Fees
|
nil
|
nil
|
||
Total:
|
$1,239,400
|
$1,396,300
|
Director
|
Board
|
Audit
|
Compensation
|
Nominating
and
Governance
|
Health,
Safety and
Environment
|
10
meetings
|
5
meetings
|
5
meetings
|
2
meeting
|
2
meeting
|
|
Ross
J. Beaty
|
10
|
-
|
-
|
-
|
-
|
Geoffrey
A. Burns
|
10
|
-
|
-
|
-
|
2
|
William
A. Fleckenstein
|
9
|
-
|
-
|
2
|
-
|
Michael
Larson
|
10
|
5
|
-
|
-
|
-
|
Michael
J.J. Maloney
|
10
|
5
|
5
|
2
|
-
|
Paul
B. Sweeney
|
8
|
5
|
5
|
-
|
-
|
Robert
P. Pirooz
|
9
|
-
|
-
|
-
|
2
|
David
C. PRESS (1)
|
6
(of 6)
|
-
|
2
(of 2)
|
-
|
1
(of 1)
|
John
M. Willson (2)
|
4
(of 4)
|
-
|
3
(of 3)
|
-
|
1
(of 1)
|
(1)
|
David
Press was elected to the Board of Directors on May 13,
2008.
|
(2)
|
John
Willson ceased to be a member of the Board of Directors on May 13,
2008.
|
Name
and
Principal
Position
|
Year
|
Salary
($)
|
Share-based
awards
($)(2)
|
Option-based
awards
($)(2)
|
Non-equity
incentive plan
Compensation
($)
|
Pension
value
($)
|
All
Other
Compensation
($)(3)
|
Total
Compensation
($)
|
|
Annual
incentive plans
|
Long-term
incentive plans
|
||||||||
Geoffrey
A. Burns
President
and Chief Executive Officer
|
2008
2007
2006
|
474,750
386,000
317,900
|
81,000
|
243,000
|
0
184,315
144,486
|
n/a
|
n/a
|
28,350
22,292
16,829
|
827,100
|
A.
Robert Doyle
Chief
Financial Officer
|
2008
2007
2006
|
267,562
244,000
234,800
|
37,800
|
113,400
|
0
85,187
81,358
|
n/a
|
n/a
|
13,230
10,568
10,170
|
431,992
|
Steven
L. Busby
Chief
Operating Officer
|
2008
2007
2006
|
358,521
300,000
274,800
|
57,173
|
171,518
|
0
113,633
101,470
|
n/a
|
n/a
|
20,010
14,175
12,984
|
607,222
|
Michael
Steinmann
Executive
Vice President, Geology and Exploration
|
2008
2007
2006
|
317,042
260,000
224,650
|
56,430
|
169,290
|
0
106,243
113,183
|
n/a
|
n/a
|
39,751(4)
12,285
10,615
|
582,513
|
Andrés
A. Dasso
Senior
Vice President, Mining Operations
|
2008
2007
2006
|
330,868
301,000
265,794
|
45,788
|
137,363
|
0
85,597
104,501
|
n/a
|
n/a
|
182,868(5)
13,133
13,101
|
696,887
|
(1)
|
Annual
compensation amounts are paid to the Named Executive Officers in Canadian
dollars, except for Mr. Dasso whose compensation is paid in US
dollars. For the purposes of this table, Mr. Dasso’s 2008 US
dollars compensation has been converted to Canadian currency at 1 USD =
1.06669 CAD, which was the average exchange rate for 2008. For
comparative purposes, compensation amounts for 2007 and 2006 which were
paid in US dollars have been converted to Canadian currency at 1 USD =
1.075 CAD.
|
(2)
|
Option
and Share-based awards for 2008 were earned under the Long-Term Incentive
Plan in 2008, and were issued on March 11,
2009.
|
(3)
|
Represents
a tax gross-up payment to the Named Executive Officers with respect to
share-based awards.
|
(4)
|
Includes
Presidential Award of $20,000 CAD for extraordinary service to the
Company.
|
(5)
|
Includes vacation pay representing
unused vacation time, paid in accordance with Peruvian law, in the amount
of $156,411 USD, to be paid in 2009 with regard to Mr. Dasso’s change in
employment position and change from Pan American Silver Peru S.A.C. to the
Company.
|
Option-based
Awards
|
Share-based
Awards
|
|||||
Name
|
Number
of Securities underlying unexercised options
(#)
|
Option
exercise
price
($)
|
Option
expiration
date
|
Value
of
unexercised
in-the-money
options
($)(1)(2)
|
Number
of
shares
or units
of
shares that
have
not vested
(#)
|
Market
or
payout
value of
share-based
awards
that
have not vested
($)
|
Geoffrey
A. Burns
President
and Chief Executive Officer
|
6,968
17,634
16,909
|
22.04
28.41
36.66
|
Jan
3, 2011
Jan
2, 2012
Jan
10, 2013
|
0
|
Nil
|
Nil
|
A.
Robert Doyle
Chief
Financial Officer
|
4,058
7,104
8,016
|
22.04
28.41
36.66
|
Jan
3, 2011
Jan
2, 2012
Jan
10, 2013
|
0
|
Nil
|
Nil
|
Steven
L. Busby
Chief
Operating Officer
|
14,248
13,606
10,752
|
22.04
28.41
36.66
|
Jan
3, 2011
Jan
2, 2012
Jan
10, 2013
|
0
|
Nil
|
Nil
|
Michael
Steinmann
Executive
Vice President, Geology and Exploration
|
2,333
2,883
7,415
9,319
|
18.80
22.04
28.41
36.66
|
Jul
27, 2010
Jan
3, 2011
Jan
2, 2012
Jan
10, 2013
|
5,156
|
Nil
|
Nil
|
Andrés
A. Dasso
Senior
Vice President, Mining Operations
|
4,666
14,011
12,770
9,267
|
18.80
22.04
28.41
36.66
|
Jul
27, 2010
Jan
3, 2011
Jan
2, 2012
Jan
10, 2013
|
10,312
|
Nil
|
Nil
|
(1)
|
Dollar amounts are in Canadian dollars. |
(2)
|
The closing price of Shares on the
TSX as at December 31, 2008 was $21.01
CAD.
|
Name
|
Option-based
awards – Value
vested
during the year
($)(2)
|
Share-based
awards
–
Value
vested
during the year
($)
|
Non-equity
incentive plan
compensation
– Value
earned
during the year
($)
|
Geoffrey
A. Burns
President
and Chief Executive Officer
|
150,797
|
Nil
|
Nil
|
A.
Robert Doyle
Chief
Financial Officer
|
88,906
|
Nil
|
Nil
|
Steven
L. Busby
Chief
Operating Officer
|
107,241
|
Nil
|
Nil
|
Andrés
A. Dasso
Senior
Vice President, Mining Operations
|
161,833
|
Nil
|
Nil
|
Michael
Steinmann
Executive
Vice President, Geology and Exploration
|
102,194
|
Nil
|
Nil
|
(1)
|
Dollar amounts are in Canadian dollars. |
(2)
|
Vesting dates for options were
January 2, 2008, January 3, 2008 and July 27,
2008.
|
After
24 months employment
|
minimum
1,500 shares
|
|
After
48 months employment
|
minimum
3,000 shares
|
|
After
60 months employment
|
minimum
5,000 shares
|
|
(i)
|
Shares
based on the 10-day weighted average of the Shares on the Nasdaq National
Market immediately prior to the annual general meeting;
or
|
|
(ii)
|
options
to purchase Shares according to the Black-Scholes formula. The exercise
price of such options will be equal to the weighted average trading price
of the Shares on the Nasdaq National Market on the five trading days (on
which at least one board lot of the Shares was traded) prior to the annual
general meeting. The options will vest immediately and will expire ten
years after the date on which they were
granted.
|
Name
|
Fees
earned (1)
(US$)
|
Share-based
awards
(US$)
|
Option-based
awards
(US$)
|
Non-equity
incentive plan compensation
(US$)
|
Pension
value
(US$)
|
All
other
compensation
(US$)
|
Total
(US$)
|
William
A. Fleckenstein
|
17,000
|
70,000
|
-
|
-
|
Nil
|
1,000(6)
|
88,000
|
Michael
Larson
|
16,167
|
70,000
|
-
|
-
|
Nil
|
1,000(6)
|
97,167
|
Michael
J.J. Maloney
|
29,084
|
70,000
|
-
|
-
|
Nil
|
1,000(6)
|
109,084
|
Paul
B. Sweeney
|
26,333
|
70,000
|
-
|
-
|
Nil
|
-
|
96,333
|
David
C. Press (2)
|
11,917
|
40,833
|
-
|
-
|
Nil
|
-
|
52,750
|
Robert
P. Pirooz(3)
|
0
|
-
|
-
|
-
|
Nil
|
-
|
0
|
Geoffrey
A. Burns(3)
|
0
|
-
|
-
|
-
|
Nil
|
-
|
0
|
Ross
J. Beaty
|
0
|
100,050(4)
|
-
|
-
|
Nil
|
86,843(5)
|
186,893
|
John
M. Willson(2)
|
7,500
|
29,167
|
-
|
-
|
Nil
|
-
|
36,667
|
(1)
|
Includes
retainer fees other than Board annual retainer fees, plus all meeting
attendance fees.
|
(2)
|
Mr.
Press became a Board member on May 13, 2008 and Mr. Willson ceased to be a
Board member on May 13, 2008.
|
(3)
|
Mr.
Pirooz and Mr. Burns are executive members of the Board and therefore
receive no compensation for services as a
director.
|
(4)
|
$100,000
CAD converted using the exchange rate on the date of payment of 1 CAD =
1.0005 USD.
|
(5)
|
$92,634
CAD, representing the administrative costs of running the Chairman’s
office, converted to US currency at 1 CAD = 0.93748 USD, which was the
average exchange rate for 2008.
|
(6)
|
Estimate of amount provided to
non-Canadian resident directors for the cost of Canadian tax filing
fees.
|
Plan
Category
|
Number
of securities to be issued upon exercise of outstanding
options,
warrants
and rights
(a)
|
Weighted-average
exercise price of outstanding options, warrants and rights
(CAD$)
(b)
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in
column(a))
(c)
|
|||
Equity
compensation plans approved by securityholders
|
614,640
|
$21.88
|
5,829,104(1)
|
|||
Total:
|
614,640
|
$21.88
|
5,829,104
|
(1)
|
6,461,470 shares reserved for
issuance under the Company’s 2008 Plan, less 9,726 shares issued to the
directors in connection with annual compensation, less options exercised,
and less the number of options outstanding as at December 31,
2008.
|
(CAD$)
|
|||||||
Pan
American Silver
Corp.
Closing Price
|
Base
|
S&P TSX
Composite
|
Base
|
||||
December
31, 2004
|
$ 19.23
|
100.00
|
9,247
|
100.00
|
|||
December
30, 2005
|
$ 21.91
|
113.94
|
11,272
|
121.90
|
|||
December
29, 2006
|
$ 29.40
|
152.89
|
12,908
|
139.59
|
|||
December
31, 2007
|
$ 34.99
|
181.96
|
13,833
|
149.59
|
|||
December
31, 2008
|
$ 21.01
|
109.26
|
8,988
|
97.20
|
BY
ORDER OF THE BOARD
|
|
/s/
ROBERT PIROOZ
|
|
Robert
Pirooz,
|
|
General
Counsel and Secretary
|
Governance Disclosure Guidelines
under
National Instrument 58-101
Disclosure of
Corporate
Governance Practices
|
Comments | |
1. Board of
Directors
|
||
(a)
Disclose the identity
of directors who are independent.
|
The
following members of the board of directors (the “Board”) of Pan American
Silver Corp. (the “Company”) proposed for nomination as directors are
considered to be “independent”, within the meaning of the Corporate
Governance Disclosure Rules:
William
A. Fleckenstein – independent
Michael
Larson – independent
Michael
J.J. Maloney – independent
David
C. Press – independent
Walter
T. Segsworth - independent
Paul
B. Sweeney – independent
|
|
(b)
Disclose the identity
of directors who are not independent, and describe the basis for that
determination.
|
§ |
Ross
J. Beaty – not independent – member of the executive of the Company from
1994 to 2006
|
§
|
Geoffrey
A. Burns – not independent – current President and Chief Executive Officer
of the
Company
|
|
§
|
Robert
Pirooz – not independent – current General Counsel and Secretary of the
Company
|
|
(c)
Disclose whether or
not a majority of directors are independent. If a majority of directors
are not independent, describe what the Board does to facilitate its
exercise of independent judgment in carrying out its
responsibilities.
|
A majority of the Company’s directors are independent - Six of the nine persons nominated as directors qualify as independent directors for the purposes of the Corporate Governance Disclosure Rules and the Nasdaq rules. | |
(d)
If a director is
presently a director of any other issuer that is a reporting issuer (or
the equivalent) in the same jurisdiction or a foreign jurisdiction,
identify both the director and the other
issuer.
|
§
|
Ross Beaty – member of the board of directors and Co-Chairman of Western Copper Corp. Chair and member of the board of directors of Lumina Copper Corp. |
§
|
Michael Larson – member of the board of trustees of Western
Asset/Claymore US Treasury Inflation Protected Securities Fund and Western
Asset/Claymore US Treasury Inflation Protected Securities Fund
(II).
|
|
§
|
Robert Pirooz – member of the board of directors of Lumina
Copper Corp., and Rodinia Minerals Inc.
|
|
§
|
Walter T. Segsworth – member of the board of directors of
Great Basin Gold Ltd. and Chairman of the board of Plutonic Power
Corporation.
|
|
§
|
Paul Sweeney – member of the board of directors of Newgold
Inc., Pacific Rim Mining Corp. and Polaris Minerals
Corporation.
|
Governance Disclosure Guidelines
under
National Instrument 58-101
Disclosure of
Corporate Governance Practices
|
Comments
|
(e)
Disclose whether or
not the independent directors hold regularly scheduled meetings at which
non-independent directors and members of management are not in attendance.
If the independent directors hold such meetings, disclose the number of
meetings held since the beginning of the issuer’s most recently completed
financial year. If the independent directors do not hold such meetings,
describe what the Board does to facilitate open and candid discussion
among its independent directors.
|
At the beginning of each regularly
scheduled board of directors meeting, the independent members of the Board
hold in camera meetings at which non-independent directors and members of
management are not in attendance.
|
(f)
Disclose whether or
not the chair of the Board is an independent director. If the Board has a
chair or lead director who is an independent director, disclose the
identity of the independent chair or lead director, and describe his or
her role and responsibilities. If the Board has neither a chair that is
independent nor a lead director that is independent, describe what the
Board does to provide leadership for its independent
directors.
|
Ross J. Beaty is the Chair of the
Board and is not independent. William Fleckenstein, an
independent director, has been appointed lead
director.
The Board has adopted a position
description for the lead director, which was recommended for adoption by
the Board by the Nominating and Governance Committee. The lead director’s
primary responsibility is to ensure that the Board functions independent
of management and to act as principal liaison between the independent
directors and the Chief Executive Officer. The “Mandate of the
Lead Director” was attached as Schedule “A” to the Company’s 2006
Information Circular and filed on SEDAR. The lead director
holds in camera meetings at each Board meeting with all independent
directors and then reports to the Board or makes
demands.
|
(g)
Disclose the
attendance record of each director for all Board meetings held since the
beginning of the issuer’s most recently completed financial
year.
|
For the financial year ended
December 31, 2008, the Board held 10 Board meetings. The
attendance records of each of the directors for the most recently
completed financial year are set out on page 12 of the Information
Circular.
|
Governance Disclosure Guidelines
under
National Instrument 58-101
Disclosure of
Corporate
Governance Practices
|
Comments
|
2.
Board
Mandate
|
|
Disclose the text of the Board’s
written mandate. If the Board does not have a written mandate, describe
how the Board delineates its role and
responsibilities.
|
The Board has adopted a formal
written mandate which defines its stewardship responsibilities. The terms of the Board of
Directors Mandate are attached hereto as Schedule
“A”.
|
3.
Position
Descriptions
|
|
(a)
Disclose whether or
not the Board has developed written position descriptions for the chair
and the chair of each Board committee. If the Board has not developed
written position descriptions for the chair and/or the chair of each Board
committee, briefly describe how the Board delineates the role and
responsibilities of each such position.
|
The
Board has adopted a written position description for the chair of the
Board, titled “Mandate of the Chairman of the Board” which was attached as
Schedule “C” to the Company’s 2006 Information Circular and filed on
SEDAR.
As
the Chairman of the Board is not independent, a lead director has been
appointed and given a mandate (see 1(f) above).
The chair of each committee has
been provided with a mandate for the committee and has accepted leadership
responsibilities for ensuring fulfilment of the applicable mandate. Each
chair is sufficiently skilled through education and experience to lead the
respective committee.
|
(b)
Disclose whether or
not the Board and Chief Executive Officer have developed a written
position description for the Chief Executive Officer. If the Board and
Chief Executive Officer have not developed such a position description,
briefly describe how the Board delineates the role and responsibilities of
the Chief Executive Officer.
|
The
Board has adopted a written position description for the chief executive
officer, titled “Mandate of the Chief Executive Officer” which was
attached as Schedule “D” to the Company’s 2006 Information Circular and
filed on SEDAR.
|
4. Orientation and Continuing
Education
|
|
(a)
Briefly describe what
measures the Board takes to orient new directors regarding (i) the role of the Board, its
committees and its directors, and (ii) the nature and operation of the
issuer’s business.
|
Each
new director, on joining the Board, is given an outline of the nature of
the Company’s business, its corporate strategy, current issues within the
Company, the expectations of the Company concerning input from directors
and the general responsibilities of the Company’s
directors. Each new director is given a board manual which
includes all Board policies and mandates. New directors are required to
meet with management of the Company to discuss and better understand the
business of the Company and will be advised by counsel to the Company of
their legal obligations as directors of the Company. Directors
have been and will continue to be given tours of the Company’s mines and
development sites to give such directors additional insight into the
Company’s
business.
|
Governance Disclosure Guidelines
under
National Instrument 58-101
Disclosure of
Corporate
Governance Practices
|
Comments
|
(b)
Briefly describe what
measures, if any, the Board takes to provide continuing education for its
directors. If the Board does not provide continuing education, describe
how the Board ensures that its directors maintain the skill and knowledge
necessary to meet their obligations as directors.
|
Directors
have been and will continue to be given tours of the Company’s silver
mines and development sites to give such directors additional insight into
the Company’s business.
In addition, the General
Counsel of the Company has the responsibility of circulating to the Board
members new and evolving corporate governance developments applicable to
directors of public companies with respect to their conduct, duties and
responsibilities.
|
5. Ethical Business
Conduct
|
|
(a)
Disclose whether or
not the Board has adopted a written code for the directors, officers and
employees. If the Board has adopted a written code: (i) disclose how a person or company
may obtain a copy of the code; (ii) describe how the Board monitors
compliance with its code, or if the Board does not monitor compliance,
explain whether and how the Board satisfies itself regarding compliance
with its code; and (iii) provide a cross-reference to any
material change report filed since the beginning of the issuer’s most
recently completed financial year that pertains to any conduct of a
director or executive officer that constitutes a departure from the
code.
|
As
part of its stewardship responsibilities, the Board has approved a formal
“Code of Ethical Conduct” (the “Code”) that is designed to deter
wrong-doing and to promote honest and ethical conduct and full, accurate
and timely disclosure. The Code is applicable to all the
Company’s directors, officers and employees. The Board monitors
compliance with the Code and is responsible for the granting of any
waivers from these standards to directors or executive
officers. Disclosure will be made by the Company of any waiver
from these standards granted to the Company’s directors or executive
officers in the Company’s quarterly report that immediately follows the
grant of such waiver.
There
has been no conduct of a director or executive officer that constitutes a
departure from the Code, and no material change report in that respect has
been filed.
|
(b)
Describe any steps
the Board takes to ensure directors exercise independent judgment in
considering transactions and agreements in respect of which a director or
executive officer has a material interest.
|
Directors must disclose to the
General Counsel any instances in which they perceive they have a material
interest in any matter being considered by the Board; and if it is
determined there is a conflict of interest, or that a material interest is
held, the conflict must be disclosed to the Board. In addition, the
interested Board member must refrain from voting and exit the meeting
while the transaction at issue is being considered by the
Board.
|
(c)
Describe any other
steps the Board takes to encourage and promote a culture of ethical
business conduct.
|
The Company’s Nominating and
Governance Committee is responsible for setting the standards of business
conduct contained in the Code and for overseeing and monitoring compliance
with the Code. The Code also sets out mechanisms for the reporting of
unethical conduct.
The Board sets the tone for
ethical conduct throughout the Company by considering and discussing
ethical considerations when reviewing the corporate transactions of the
Company.
|
Governance Disclosure Guidelines
under
National Instrument 58-101
Disclosure of
Corporate
Governance Practices
|
Comments
|
6. Nomination of
Directors
|
|
(a)
Describe the
process by which the Board identifies
new candidates for Board nomination.
(b)
Disclose whether or
not the Board has a nominating committee composed entirely of independent
directors. If the Board does not have a nominating committee composed
entirely of independent directors, describe what steps the Board takes to
encourage an objective nomination process.
(c)
If the Board has a
nominating committee, describe the responsibilities, powers and operation
of the nominating committee.
|
All
members of the Board are tasked with recommending individuals they believe
are suitable candidates for the Board. The Nominating and Governance
Committee identifies, reviews the qualifications of and recommends to the
Board possible nominees for election or re-election to the Board at each
annual general meeting of the Company and identifies, reviews the
qualifications of and recommends to the Board possible candidates to fill
vacancies on the Board between annual general meetings. The
Nominating and Governance Committee also annually reviews and makes
recommendations to the Board with respect to the composition of the
Board.
All
members of the Nominating and Governance Committee are outside,
non-management and independent directors in accordance with the Corporate
Governance Disclosure Rules and the Nasdaq Rules.
The
Nominating and Governance Committee oversees the effective functioning of
the Board and annually reviews and makes recommendations to the Board with
respect to: (i) the composition of the Board; (ii) the appropriateness of
the committees of the Board, their mandates and responsibilities and the
allocation of directors to such committees; and (iii) the appropriateness
of the terms of the mandate and responsibilities of the
Board.
|
7. Compensation
|
|
(a)
Describe the process
by which the Board determines the compensation for the issuer’s directors
and officers.
(b)
Disclose whether or
not the Board has a compensation committee composed entirely of
independent directors. If the Board does not have a compensation committee
composed entirely of independent directors, describe what steps the Board
takes to ensure an objective process for determining such
compensation.
(c)
If the Board has a
compensation committee, describe the responsibilities, powers and
operation of the compensation committee.
(d)
If a compensation
consultant or advisor has, at any time since the beginning of the issuer’s
most recently completed financial year, been retained to assist in
determining compensation for any of the issuer’s directors and officers,
disclose the identity of the consultant or advisor and briefly summarize
the mandate for which they have been retained. If the consultant or
advisor has been retained to perform any other work for the issuer, state
that fact and briefly describe the nature of the
work.
|
The
Company’s Chief Executive Officer, Vice President of Human Resources and
the Compensation Committee reviews overall compensation policies, compares
them to the overall industry, and makes recommendations to the Board on
the compensation of executive officers.
The
Compensation Committee is comprised of three directors, each of whom is an
independent director for the purposes of the Corporate Governance
Disclosure Rules and the Nasdaq rules. The Chairman of the
Compensation Committee is Michael J. J. Maloney.
The
Compensation Committee determines the salary and benefits of the executive
officers of the Company, determines the general compensation structure,
policies and programs of the Company, administers the Company’s Annual
Incentive Plan, Long-Term Incentive Plan and Stock Option and Stock Bonus
Plan, and delivers an annual report to shareholders on executive
compensation.
In
addition, the Compensation Committee reviews and makes recommendations to
the Board for approval with respect to the annual and long term corporate
goals and objectives relevant to determining the compensation of the
President and Chief Executive Officer.
|
Governance Disclosure Guidelines
under
National Instrument 58-101
Disclosure of
Corporate
Governance Practices
|
Comments
|
8.
Other Board
Committees
|
|
If the Board has standing
committees other than the audit, compensation and nominating committees,
identify the committees and describe their
function.
|
The
Board also has a Health, Safety and Environment Committee which consists
of three directors. The Company recognizes that proper care of
the environment is integral to its existence, its employees, the
communities in which it operates and all of its operations. The
Health, Safety and Environment Committee ensures that an audit is made of
all construction, remediation and active mines. The results of such audits
are reported to the Health, Safety and Environment Committee as is the
progress on any significant remediation efforts. The Health, Safety and
Environment Committee ensures that strict policies with respect to the
health and safety of its employees are in place at each of its operations
and that such policies are enforced.
|
9.
Assessments
Disclose whether or
not the board, its committees and individual directors are regularly
assessed with respect to their effectiveness and contribution. If
assessments are regularly conducted, describe the process used for the
assessments. If assessments are not regularly conducted, describe how the
board satisfies itself that the board, its committees, and its individual
directors are performing effectively.
|
The
Chief Executive Officer is assessed each year on the basis of the
objectives set out by the Board for that position, the Chief Executive
Officer’s individual performance throughout the year and that individual’s
ability to execute on long-term strategy. The Chief Executive Officer is
assessed first by the Compensation Committee and then by the Board as a
whole.
The
Board has also appointed a Nominating and Governance Committee, which
proposes and makes recommendations to the Board with respect to: (i) the
composition of the Board; (ii) the appropriateness of the committees of
the Board, their mandates and responsibilities and the allocation of
directors to such committees; and (iii) the appropriateness of the terms
of the mandate and responsibilities of the Board. During 2005, the
Nominating and Governance Committee, in consultation with the entire
Board, undertook to formally establish the roles and responsibilities of
each of the Lead Director, the Chairman of the Board and the Chief
Executive Officer and determine against what criteria each such position
should be assessed.
|
Governance Disclosure Guidelines
under
National Instrument 58-101
Disclosure of
Corporate
Governance Practices
|
Comments
|
In
2006, the Nominating and Governance Committee developed a process to
assess the Board as a whole and the committees of the
Board. The performance assessment of the Board and each
Committee of the Board is based on information and feedback obtained from
director evaluation questionnaires provided to each
director. Each director is asked to complete and return the
assessment questionnaire to the Lead Director on a confidential
basis. The Lead director may discuss the completed
questionnaires with individual directors where clarification is
required. The evaluation process focuses on Board and committee
performance, and also asks for peer feedback and suggestions or comments
regarding the performance of the Chair of each committee and the Lead
Director. The Lead Director reports the results of the
performance assessments to the Board.
The
Board and the Nominating and Governance Committee have formally assessed
the effectiveness of each member of the Board, and have determined that
each Board member is significantly qualified through their current or
previous professions. Each member fully participates in each
meeting having in all cases been specifically canvassed for their
input.
|
A.
|
Subject
to the Memorandum and Articles of the Company and applicable law, the
Board of Directors of the Company (the “Board”) has a responsibility for
the stewardship of the Company, including the responsibility
to:
|
|
(i)
|
supervise
the management of and oversee the conduct of business of the
Company;
|
|
(ii)
|
provide
leadership and direction to
management;
|
|
(iii)
|
evaluate
management;
|
|
(iv)
|
set
policies appropriate for the business of the Company;
and
|
|
(v)
|
approve
corporate strategies and goals.
|
A.
|
A
majority of the Board shall be unrelated to the
Company.
|
B.
|
The
directors will be elected each year by the shareholders of the Company at
the annual general meeting of shareholders. The Nominating and
Governance Committee will recommend to the full Board nominees for
election to the Board and the Board will propose a slate of nominees to
the shareholders for election as directors for the ensuing
year.
|
C.
|
Immediately
following each annual general meeting, the Board
shall:
|
|
(i)
|
elect
a Chairman of the Board and, when desirable, a lead director of the Board,
and establish their duties and
responsibilities;
|
|
(ii)
|
appoint
the President and Chief Executive Officer of the Company and establish
their duties and responsibilities;
|
|
(iii)
|
on
the recommendation of the Chief Executive Officer, appoint the senior
officers of the Company and approve the senior management structure of the
Company;
|
|
(iv)
|
appoint
a nominating and governance committee, an audit committee, a compensation
committee and a health, safety and environment committee;
and
|
|
(v)
|
approve
the mandate, duties and responsibilities of each committee of the board of
directors;
|
D.
|
The
Board shall be responsible for monitoring the performance of the President
and Chief Executive Officer, and for determining the compensation of the
President and Chief Executive
Officer.
|
E.
|
From
time to time, the Board may appoint special committees to assist the Board
in connection with specific
matters.
|
F.
|
The
Board shall meet not less than four times during each year and will
endeavour to hold one meeting in each financial quarter. The Board will
also meet at any other time at the call of the Chairman of the Board or,
subject to the Memorandum and Articles of the Company, of any
director.
|
A.
|
The
Board will ensure the Company has management of the highest
calibre. This responsibility is carried out primarily
by:
|
|
(i)
|
appointing
the President as the Company’s business leader and developing criteria and
objectives against which the Board will assess, on an ongoing basis, the
President’s performance;
|
|
(ii)
|
developing
position descriptions for the Chairman of the Board and the chair of each
board committee and, with the Chief Executive Officer, developing position
descriptions for the President and Chief Executive Officer, and regularly
assessing those appointed individuals against such descriptions;
and
|
|
(iii)
|
developing
and approving corporate objectives which the Chief Executive Officer is
responsible for meeting, and assessing the Chief Executive Officer against
these objectives.
|
B.
|
A
principal responsibility of the Chairman of the Board will be to manage
and act as the chief administrative officer of the Board with such duties
and responsibilities as the Board may establish from time to time. The
Chairman of the Board need not be independent of
management.
|
C.
|
The
principal duties and responsibilities of the lead director will be as
established by the Board from time to time. The lead director will be
independent of management.
|
D.
|
The
Board will ensure that proper limits are placed on management’s
authority.
|
A.
|
The
Board is responsible for adopting, supervising and providing guidance on
the strategic planning process and approving a strategic plan which takes
into account, among other things, the opportunities and risks of the
Company’s business.
|
B.
|
The
President and senior management team will have direct responsibility for
the ongoing strategic planning process and the establishment of long term
goals for the Company, which are to be reviewed and approved not less than
annually by the Board.
|
C.
|
The
Board will have a continuing understanding of the principal risks
associated with the business, largely through continuous communication
with management. The Board will ensure the implementation of appropriate
systems to manage any such risks.
|
D.
|
The
Board will provide guidance to the President and senior management team
with respect to the Company’s ongoing strategic plan. The Board
is responsible for monitoring the success of management in implementing
the approved strategies and goals.
|
A.
|
Through
the President and Chief Executive Officer, management will establish
systems to ensure that appropriate and responsible levels of internal
controls are in place for the Company. The confidence of the Board in the
ability and integrity of management is the paramount control
mechanism.
|
A.
|
The
Board will monitor and review annually the policies and procedures that
are in place to provide for effective communication by the Company with
its shareholders and with the public generally,
including:
|
|
(i)
|
effective
means to enable shareholders to communicate with senior management and the
Board; and
|
|
(ii)
|
effective
channels by which the Company will interact with analysts and the
public.
|
B.
|
The
Board will approve the content of the Company’s major communications to
shareholders and the investing public, including interim and annual
reports, the Management Information Circular, the Annual Information Form,
any prospectuses that may be issued and significant press
releases.
|
C.
|
The
Board will maintain a Corporate Disclosure Policy which summarizes its
policies and practices regarding disclosure of material information to
investors, analysts and the media.
|
A.
|
The
Board will keep in place, and review regularly, adequate and effective
succession plans for the Chairman, President and senior management
personnel (including appointing, training and monitoring senior
management).
|
A.
|
The
Board will provide for the independent functioning of the Board. The Board
will implement appropriate structures and procedures to ensure that the
Board can function independently of management at such times as is
desirable or necessary through:
|
|
(i)
|
the
recruitment of strong, independent directors, who shall compose a majority
of the Board;
|
|
(ii)
|
the
appointment of a committee of directors independent of
management;
|
|
(iii)
|
the
appointment of a lead director who is not a member of management;
and
|
|
(iv)
|
the
institution of regular meetings of independent directors at every
quarterly Board meeting, without the presence of management and which is
chaired by the lead director.
|
B.
|
All
directors will have open access to the Company’s senior
management.
|
C.
|
The
Board encourages individual directors to make themselves available for
consultation with management outside Board meetings in order to provide
specific advice and counsel on subjects where such directors have special
knowledge and experience.
|
A.
|
The
Nominating and Governance Committee, in conjunction with the Chairman and
President, is responsible for ensuring that new directors are provided
with an orientation and education
program.
|
B.
|
The
details of the orientation of each new director will be tailored to that
director’s individual needs and areas of
interest.
|
C.
|
The
Board will assist the Nominating and Governance Committee in establishing
and maintaining an ongoing director education
program.
|
A.
|
Approve
all capital plans and establish priorities for the allocation of funds to
ongoing operations and capital
projects.
|
B.
|
Approve
all single expenditure items proposed by the Company exceeding $2,000,000
not provided for in any approved capital
plan.
|
C.
|
Approve
any policy for hedging and forward sales of silver and/or base
metals.
|
D.
|
Approve
any policy for management of foreign currency
risk.
|
E.
|
Approve
the annual budget.
|
F.
|
Attend,
prepare for and be actively involved in regular Board meetings and, if
applicable, Board committee
meetings.
|
G.
|
Develop
the Company’s approach to corporate governance, including developing a set
of corporate governance principles and guidelines that are specifically
applicable to the Company.
|
H.
|
Adopt
and monitor, through the Nominating and Governance Committee, a formal
code of business ethics that will govern the behaviour of directors,
officers and employees of the Company, and, in appropriate circumstances,
grant waivers from such code of business
conduct.
|
A.
|
The
Board and any committees may at any time retain outside financial, legal
or other advisors at the expense of the Company. Any director may, subject
to the approval of the Chairman of the Board, retain an outside advisor at
the expense of the Company.
|
Security
Class
|
|
Holder
Account Number
|
1.
|
Every
holder has the right to appoint some other person or company of their
choice, who need not be a holder, to attend and act on their behalf at the
meeting. If you wish to appoint a person or company other than the persons
whose names are printed herein, please insert the name of your chosen
proxyholder in the space provided (see reverse).
|
2.
|
If
the securities are registered in the name of more than one owner (for
example, joint ownership, trustees, executors, etc.), then all those
registered should sign this proxy. If you are voting on behalf of a
corporation or another individual you must sign this proxy with signing
capacity stated, and you may be required to provide documentation
evidencing your power to sign this proxy.
|
3.
|
This
proxy should be signed in the exact manner as the name(s) appear(s) on the
proxy.
|
4.
|
If
this proxy is not dated, it will be deemed to bear the date on which it is
mailed by Management to the holder.
|
5.
|
The
securities represented by this proxy will be voted as directed by the
holder, however, if such a direction is not made in respect of any matter,
this proxy will be voted as recommended by Management.
|
6.
|
The
securities represented by this proxy will be voted in favour or
withheld from voting or voted against eachof the matters described herein,
as applicable, in accordance with the instructions of the holder, on any
ballot that may be called for and, if the holder has specified a choice
with respect to any matter to be acted on, the securities will be voted
accordingly.
|
7.
|
This
proxy confers discretionary authority in respect of amendments or
variations to matters identified in the Notice of Meeting or other matters
that may properly come before the meeting or any adjournment or
postponement thereof.
|
8.
|
This
proxy should be read in conjunction with the accompanying documentation
provided by Management.
|
• Call the number listed BELOW from
a touch tone
telephone.
|
• Go to the following web
site:
www.investorvote.com
|
|
1-866-732-VOTE (8683) Toll Free
|
CONTROL
NUMBER
|
HOLDER ACCOUNT
NUMBER
|
ACCESS
NUMBER
24FE09041.E.SEDAR/000001/000001/1
|
+ | + |
Appointment of
Proxyholder
|
||||
We, being holder(s) of Pan
American Silver Corp. hereby appoint: Geoffrey A. Burns,
or failing this
person, Robert P. Pirooz,
|
OR
|
Print the name of the person you are appointing if this person is someone other than the Management Nominees listed herein. |
For
|
Withhold
|
For
|
Withhold
|
For
|
Withhold
|
|||
01. Ross J.
Beaty
|
o
|
o
|
02. Geoffrey A.
Burns
|
o
|
o
|
03. Robert P.
Pirooz
|
o
|
o
|
|
||||||||
04. William A.
Fleckenstein
|
o
|
o
|
05. Michael J.J.
Maloney
|
o
|
o
|
06. Michael
Larson
|
o
|
o
|
07. Paul B.
Sweeney
|
o
|
o
|
08. David C.
Press
|
o
|
o
|
09. Walter T. Segsworth |
o
|
o
|
2. Appointment of
Auditors
|
For
|
Withhold
|
|
Reappointment
of Deloitte
& Touche
LLP as Auditors
of the Company.
|
|||
o
|
o
|
||
3. Fixing
of Remuneration
|
For
|
Against
|
|
To
authorize the Directors to fix the Auditors'
remuneration.
|
|||
o
|
o
|
Authorized Signature(s) - This
section must be completed for your instructions to be
executed.
|
Signature(s)
|
Date
|
||
I/We
authorize
you to act
in accordance with my/our instructions set out above. I/We hereby revoke
any proxy previously given with respect to the Meeting. If
no voting instructions are indicated above, this Proxy will be voted as
recommended by Management.
|
DD / MM / YY
|
|||
Interim
Financial Statements
- Mark this box if you would like to receive interim financial statements
and accompanying
Management’s Discussion and Analysis by mail.
|
Annual
Financial Statements - Mark this box if you would like to receive
the Annual Financial Statements and
accompanying
Management’s Discussion and Analysis by
mail.
|
||
■ | 0 5 9 0 9 7 |
A R 1
|
P A A Q
|
+ |
PAN AMERICAN SILVER
CORP
|
|||||
(Registrant)
|
|||||
Date:
|
April
14, 2009
|
By:
|
/s/
Robert Pirooz
|
||
Name: Robert
Pirooz
Title: General Counsel, Secretary and
Director
|