Dear Fellow Shareholders:

WiLAN is on a journey that began in 2006 to build the leading
intellectual property licensing company in the world. Our efforts and
accomplishments in 2012 advanced key strategies that are driving
WiLAN's business forward.

Our ability to build a world-leading IP licensing company begins with
our licensing strategy. This strategy must support long-term,
sustainable growth of our business and requires us to sign the right
license agreement with users of our IP. The right license agreement
fairly compensates WiLAN for the use of our patented inventions. To be
"right", other factors are also important including the term of the
agreement, the royalty rate, the patents included, the geographic reach
and the products licensed. All our license deals are complex and
negotiating the right agreement can take time. In 2012, WiLAN signed
eight new licenses, bringing the total number of companies licensed to
date to 265. The licenses signed in 2012 contributed to annual revenues
of $88 million and are expected to add millions of dollars to our
revenues in the future.

While we can control some things in the licensing process, we cannot
control when licensees will be willing to accept terms that we consider
fair to WiLAN. In our business we believe a firm resolve to take the
time and steps necessary to reach the right agreement is the key to
long-term success.

WiLAN took the step of launching several litigations in the second half
of 2012, against many existing defendants, to encourage serious
negotiations. The short-term investment in litigation is sometimes
necessary to generate a significant return for WiLAN over the long-term.
When investment in litigation is necessary, we target, and to date have
delivered, a greater than five times return on our investment.

With six trials currently scheduled in 2013, this year is shaping up to
be very busy for WiLAN. While we prefer to reach agreements without
litigation, some users of our IP seem to require the pressure of one or
more litigations before they will seriously focus on negotiating a
license on terms that properly reflect the value of that IP. We believe
it is somewhat misguided when some companies choose to invest
significantly in their law firms and the legal system rather than
focusing on obtaining a license to our IP portfolio at a fair price. If
users of our IP refuse to take a license on fair terms, however, we will
use the courts, repeatedly if necessary, to demonstrate the strength of
our IP.

One of our critical strategies is to increase the size of WiLAN's
patent portfolio. This increases the value of our portfolio to
prospective and current licensees. Our goal is to build, through
research and acquisition, a portfolio that provides overwhelming value
to both current and future licensees.

Since 2006, our investment in research has yielded over 160 patents and
patent applications covering valuable 4G, next-generation 5G and
whitespace wireless technologies. When it comes to acquiring patents for
our core portfolios, we are very selective. In 2012, WiLAN also acquired
valuable portfolios from Siemens AG and Alvarion Ltd. With the patents
we acquired from Alvarion, we believe our portfolio of 4G wireless
related issued and pending patents, which now numbers over 650, will
prove very valuable when it comes to signing future licenses.

Our acquisition and research programs have increased the size of our
core portfolio from just over 20 issued and pending patents in 2006 to
over 3,000 today, including over 1,000 wireless and 1,400 digital TV and
display patents. Licensing these core portfolios has generated hundreds
of millions of realized or expected revenues. And we are not done - in
fact we are just beginning.

We believe our ongoing efforts to license these core portfolios will
generate significant future revenues. Although we believe our existing
portfolio is strong enough to generate significant growth, we continue
to invest in the future to make it even better. Having realized
significant returns from licensing our wireless and digital TV and
display portfolios, we took steps in 2012 to expand the number of core
licensing programs. We believe opportunities exist to acquire and
license valuable portfolios in the cloud computing, medical devices and
semiconductor markets.

With a growing realization among patent owners of the potential to
generate revenue from patents, comes a growing demand for partnerships
with licensing experts like WiLAN that have the expertise and resources
necessary to carry out successful licensing programs. Capitalizing on
this demand, another WiLAN strategy is forging partnerships with owners
of small and large patent portfolios across markets and industries, to
increase the number of portfolios that we can effectively license.

At this time our Gladios subsidiary, which carries out our partnership
licensing activities, has signed agreements with 12 partners. In 2012,
we launched litigations with two of our partners, 01 Communique and
Treehouse. We are pleased that 01 Communique generated its first
significant licensing revenues, through a license agreement with Bomgar
Corporation in April 2012. Negotiations with several prospective
partners advanced in 2012 resulting in the signing of two additional
partnerships in 2012, including one with SENSIO Technologies for its
valuable 3D TV technology, and agreements with British
Telecommunications Plc and three other partners early in 2013.

Our solid balance sheet, with over $176 million in cash at the end of
2012, and WiLAN's strong financial performance in 2012, generating
adjusted earnings of over $41 million or 47 percent of revenues and
generating over $34 million in cash from operations, give WiLAN a very
strong financial foundation upon which to continue building our
business. This foundation demonstrates to prospective licensees that
WiLAN can afford to take the time and steps necessary to achieve a fair
and balanced license agreement. WiLAN's financial strength also
gives us the ability to invest in research and patent acquisitions,
support our partnerships and return capital to shareholders. In 2012,
WiLAN invested over $25 million in patent acquisitions and over $30
million in dividend and share buyback payments to shareholders. In
addition, our strong financial position and future potential earnings
gave WiLAN's Board of Directors the confidence to increase our
annual dividend twice in calendar year 2012 and once more in calendar
2013.

We believe the successful execution of our business will position WiLAN
to generate significantly higher revenue and stronger cash flow in the
future. Our capital allocation model, which currently calls for
approximately 40% of cash flow to be invested in acquisitions and
approximately 40% of cash flow to be invested in dividend payments, will
drive yet more business growth and shareholder return.

By following our strategies, we believe WiLAN will continue to build a
strong and profitable licensing business capable of generating long
term, sustained return for all shareholders.

We would like to thank WiLAN's employees and our Board of Directors
for their dedication and hard work. WiLAN could not have accomplished
what it did in 2012 without the collective effort of our team, one that
is truly world-class. We would also like to sincerely thank WiLAN's
shareholders for their continued support.

Best regards,
Paul McCarten
Chairman of the Board

Jim Skippen
President & CEO