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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
AUTODESK, INC.
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(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
[LOGO OF AUTODESK APPEARS HERE]
May 22, 1998
Dear Autodesk Stockholder:
You are cordially invited to attend Autodesk's 1998 Annual Meeting of
Stockholders to be held on Thursday, June 25, 1998 at 2:00 p.m., local time.
The meeting will be held at the Embassy Suites Hotel, 101 McInnis Parkway, San
Rafael, California.
At the Annual Meeting, you will be asked to elect seven directors and to
ratify the appointment of Ernst & Young LLP as the Company's independent
auditors for the 1999 fiscal year.
We hope you will be able to attend this year's Annual Meeting. We will
report to the stockholders on fiscal year 1998, as well as our future
strategies for products and markets. There will be an opportunity for all
stockholders to ask questions. Whether or not you plan to attend the meeting,
please sign and return the enclosed proxy card to ensure your representation
at the meeting.
Very truly yours,
/s/ Carol A. Bartz
Carol A. Bartz
Chief Executive Officer and Chairman
of the Board
AUTODESK, INC.
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NOTICE OF 1998 ANNUAL MEETING OF STOCKHOLDERS
JUNE 25, 1998
TO THE STOCKHOLDERS OF AUTODESK, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Autodesk,
Inc. ("Autodesk" or the "Company"), a Delaware corporation, will be held on
Thursday, June 25, 1998 at 2:00 p.m., local time, at the Embassy Suites Hotel,
101 McInnis Parkway, San Rafael, California, for the following purposes:
1. To elect directors to serve for the ensuing year and until their
successors are elected.
2. To ratify the appointment of Ernst & Young LLP as independent auditors
of the Company for the fiscal year ending January 31, 1999.
3. To transact such other business as may properly come before the meeting
or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
Only stockholders of record at the close of business on May 15, 1998 are
entitled to notice of and to vote at the meeting and any adjournment thereof.
All stockholders are cordially invited to attend the meeting in person. Any
stockholder attending the meeting may vote in person even if such stockholder
previously signed and returned a Proxy.
FOR THE BOARD OF DIRECTORS
/s/ Marcia K. Sterling
Marcia K. Sterling
Vice President, Business Development,
General Counsel and Secretary
San Rafael, California
May 22, 1998
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE IN ORDER
TO ENSURE REPRESENTATION OF YOUR SHARES. NO POSTAGE NEED BE AFFIXED IF MAILED
IN THE UNITED STATES.
AUTODESK, INC.
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PROXY STATEMENT FOR 1998 ANNUAL MEETING OF STOCKHOLDERS
The enclosed proxy is solicited on behalf of the Board of Directors of
Autodesk, Inc. (the "Company") for use at the Company's 1998 Annual Meeting of
Stockholders ("Annual Meeting") to be held Thursday, June 25, 1998 at 2:00
p.m., local time, or at any adjournment or postponement thereof, for the
purposes set forth herein and in the accompanying Notice of Annual Meeting of
Stockholders. The Annual Meeting will be held at the Embassy Suites Hotel, 101
McInnis Parkway, San Rafael, California.
The Company's principal executive offices are located at 111 McInnis
Parkway, San Rafael, California 94903. The telephone number at that address is
(415) 507-5000.
These proxy solicitation materials were mailed on or about May 22, 1998 to
all stockholders entitled to vote at the Annual Meeting.
INFORMATION CONCERNING SOLICITATION AND VOTING
RECORD DATE AND SHARES OUTSTANDING
Stockholders of record at the close of business on May 15, 1998 (the "Record
Date") are entitled to notice of, and to vote at, the Annual Meeting. At the
Record Date, 47,047,581 shares of the Company's Common Stock were issued and
outstanding and entitled to vote at the meeting.
REVOCABILITY OF PROXIES
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to the Secretary of the
Company a written notice of revocation or a duly executed proxy bearing a
later date or by attending the Annual Meeting and voting in person.
VOTING AND SOLICITATION
Every stockholder voting for the election of directors is entitled to one
vote for each share held. Stockholders do not have the right to cumulate their
votes in the election of directors. On all other matters each share is
likewise entitled to one vote on each proposal or item that comes before the
Annual Meeting.
The cost of this solicitation will be borne by the Company. The Company has
retained Georgeson & Company, Inc. to assist in the solicitation of proxies at
an estimated fee of $2,000, plus reimbursement of reasonable expenses. In
addition, the Company may reimburse brokerage firms and other persons
representing beneficial owners of shares for their expenses in forwarding
solicitation material to such beneficial owners. Proxies also may be solicited
by certain of the Company's directors, officers and employees, without
additional compensation, personally or by telephone, telegram, letter, e-mail
or facsimile.
QUORUM; ABSTENTIONS; BROKER NON-VOTES
The required quorum for the transaction of business at the Annual Meeting is
a majority of the shares of Common Stock outstanding on the Record Date.
Shares that are voted "FOR," "AGAINST" or "WITHHELD" from a matter are treated
as being present at the meeting for purposes of establishing a quorum and are
also treated as being entitled to vote on the subject matter (the "Votes
Cast") with respect to such matter.
While abstentions (votes "withheld") will be counted for purposes of
determining both the presence or absence of a quorum for the transaction of
business and the total number of Votes Cast with respect to a particular
matter, broker non-votes with respect to proposals set forth in this Proxy
Statement will not be considered Votes Cast and, accordingly, will not affect
the determination as to whether the requisite majority of Votes Cast has been
obtained with respect to a particular matter.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company which are intended to be presented
by such stockholders at the Company's 1999 Annual Meeting must be received by
the Secretary of the Company no later than January 22, 1999 in order to be
included in the proxy soliciting materials relating to that meeting.
PROPOSAL ONE
ELECTION OF DIRECTORS
NOMINEES
A board of seven directors is to be elected at the meeting. Each director
elected to the board will hold office until the next Annual Meeting or until
his or her successor has been elected and qualified. Unless otherwise
instructed, the proxy holders will vote the proxies received by them for the
seven nominees named below, all of whom are presently directors of the
Company. In the event that any nominee is unable or declines to serve as a
director at the time of the Annual Meeting, the proxies will be voted for any
nominee who shall be designated by the present Board of Directors to fill the
vacancy. The proxies cannot be voted for a greater number of persons than the
number of nominees named in this proxy statement. It is not expected that any
nominee will be unable or will decline to serve as a director.
The name of and certain information regarding each nominee is set forth
below.
DIRECTOR
NAME OF NOMINEE AGE PRINCIPAL OCCUPATION SINCE
------------------------ --- ------------------------------------ --------
Carol A. Bartz.......... 49 Chief Executive Officer and Chairman 1992
of the Board of the Company
Mark A. Bertelsen....... 54 Senior Partner, Wilson Sonsini 1992
Goodrich & Rosati, Professional
Corporation, attorneys at law
Crawford W. Beveridge... 52 Chief Executive Officer, Scottish 1993
Enterprise
J. Hallam Dawson........ 61 Chairman, IDI Associates 1988
Paul S. Otellini........ 47 Executive Vice President and General 1997
Manager, Intel Architecture Business
Group, Intel Corporation
Mary Alice Taylor....... 48 Corporate Executive Vice President, 1995
Global Operations and Technology,
CitiCorp
Morton Topfer........... 61 Vice Chairman, Dell Computer 1995
Corporation
Except as set forth below, each of the nominees has been engaged in his or
her principal occupation described above during the past five years. There is
no family relationship among any of the directors or executive officers of the
Company.
Ms. Bartz joined the Company in April 1992 and serves as Chief Executive
Officer and Chairman of the Board. Ms. Bartz served as President of the
Company from May 1992 through September 1996. Ms. Bartz is a director of
AirTouch Communications, Inc., Cadence Design Systems, Inc., Cisco Systems,
Inc., Network Appliance, Inc. and BEA Systems, Inc.
Mr. Bertelsen joined the law firm of Wilson Sonsini Goodrich & Rosati,
outside legal counsel to the Company, in January 1972 and became a member of
the firm in January 1977.
Mr. Beveridge has served as the Chief Executive Officer of Scottish
Enterprise, an economic development company, since January 1991. Mr. Beveridge
is a director of U.S. Smaller Companies Investment Trust and Clydeport plc.
Mr. Dawson has served since September 1986 as Chairman of IDI Associates, a
private investment bank specializing in Latin America.
2
Mr. Otellini has served as Executive Vice President and General Manager of
the Intel Architecture Business Group at Intel Corporation since January 1998.
Mr. Otellini was promoted to Executive Vice President of Sales and Marketing
of Intel Corporation in April 1996 and served as Senior Vice President of
Sales and Marketing of Intel Corporation from May 1993 to May 1996. Mr.
Otellini is a director of Fritz Companies.
Ms. Taylor has served as Executive Vice President of Global Operations and
Technology for CitiCorp since January 1997. Ms. Taylor served as Senior Vice
President of Federal Express Corporation from September 1991 until December
1996. Ms. Taylor is a director of Perrigo, Inc. and Allstate Insurance, Inc.
Mr. Topfer has served as Vice Chairman of Dell Computer Corporation since
June 1994. From March 1971 to June 1994, Mr. Topfer was the Executive Vice
President of Motorola, Inc.
BOARD MEETINGS AND COMMITTEES
Ms. Bartz serves as Chairman of the Board of Directors of the Company. The
Board of Directors held a total of five (5) meetings during the fiscal year
ended January 31, 1998. All of the current directors attended seventy-five
percent (75%) or more of the meetings of the Board of Directors and committees
of the Board, if any, upon which such directors served during their term of
office.
The Audit Committee consists of directors J. Hallam Dawson (Chairman), Mark
Bertelsen and Mary Alice Taylor. The principal functions of the Audit
Committee are to recommend engagement of the Company's independent auditors,
to consult with the Company's auditors concerning the scope of the audit and
to review with them the results of their examination, to review and approve
any material accounting policy changes affecting the Company's operating
results and to review the Company's financial control procedures and
personnel. The Audit Committee held four (4) meetings during fiscal year 1998.
The Compensation Committee consists of directors Crawford Beveridge
(Chairman), Morton Topfer and Paul Otellini. The Compensation Committee
reviews compensation and benefits for the Company's executives and administers
the grant of stock options to executive officers under the Company's stock
plans. In December 1995, the Board delegated to the Company's Chief Executive
Officer authority to grant options to non-officer employees to the extent such
options fall within standard guidelines previously approved by the
Compensation Committee. The authority to grant all other options (except
options which are granted automatically to outside directors under the non-
discretionary 1990 Directors' Option Plan) has been delegated to the
Compensation Committee. The Compensation Committee, which consists solely of
outside directors ineligible to participate in the Company's discretionary
employee stock programs, has sole and exclusive authority to grant stock
options to officers and to directors who are also employees or consultants of
the Company. The Compensation Committee held four (4) meetings during fiscal
year 1998.
The Nominating Committee consists of directors Morton Topfer (Chairman),
Carol Bartz and Crawford Beveridge. The Nominating Committee has the
responsibility to present a slate of nominees to the full Board prior to each
Annual Meeting and to make recommendations regarding outside director
compensation.
COMPENSATION OF DIRECTORS
The Company pays an annual fee of $25,000 to each director who is not an
employee of or consultant to the Company (currently six persons), of which not
more than fifty percent can be cash and the balance must be restricted stock
issued at the rate of $1.20 worth of stock for each $1.00 of cash compensation
foregone. Directors do not receive fees for Board or Board Committee meetings
attended.
The Company's 1990 Directors' Option Plan provides for the automatic grant
of nonstatutory options to outside directors of the Company. Upon being
elected or appointed to the Company's Board of Directors, each outside
director is granted an option to purchase 20,000 shares of Common Stock of the
Company, with subsequent annual grants of 10,000 shares. Each Option granted
under the 1990 Directors' Option Plan vests cumulatively as to one-third of
the shares subject to the option on each anniversary of the date of grant, for
a total vesting period of three years. The exercise price of options granted
under the 1990 Directors' Option Plan is equal to the fair market value of the
Common Stock on the date of grant.
3
MANAGEMENT
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock as of May 15, 1998 (i) by each person
who is known by the Company to own beneficially more than five percent (5%) of
the Company's Common Stock, (ii) by each of the Company's directors, (iii) by
each of the Company's Chief Executive Officer and the Company's four most
highly compensated executive officers (other than the Chief Executive Officer)
who served as executive officers at January 31, 1998 (collectively, the "Named
Officers") and (iv) by all directors and executive officers who served as
directors or executive officers at January 31, 1998 as a group.
SHARES BENEFICIALLY OWNED
DIRECTORS, OFFICERS AND FIVE PERCENT (5%) ----------------------------
STOCKHOLDERS NUMBER(1) PERCENT(2)
- ----------------------------------------- -------------- -------------
PRINCIPAL STOCKHOLDERS:(3)
J.P. Morgan & Co. Incorporated................... 4,966,835 10.56%
525 Fifth Avenue
New York, NY 10036
American Century Companies, Inc.................. 2,756,400 5.86%
Twentieth Century Tower
4500 Main Street
Kansas City, MO 64111
DIRECTORS:
Carol A. Bartz(4)................................ 1,104,937 2.29%
Mark A. Bertelsen(5)............................. 23,791 *
Crawford W. Beveridge(6)......................... 35,986 *
J. Hallam Dawson(7).............................. 55,877 *
Paul S. Otellini................................. -- --
Mary Alice Taylor(8)............................. 24,892 *
Morton Topfer(9)................................. 27,127 *
OTHER NAMED OFFICERS:
Eric B. Herr(10)................................. 243,937 *
Dominic J. Gallello(11).......................... 235,015 *
Godfrey R. Sullivan(12).......................... 175,698 *
Michael E. Sutton(13)............................ 148,080 *
ALL DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP
(20 PERSONS)(14):................................ 2,811,972 5.65%
- --------
* Represents less than 1% of the outstanding shares.
(1) The number and percentage of shares beneficially owned is determined
under the rules of the SEC, and the information is not necessarily
indicative of beneficial ownership for any other purpose. Under such
rules, beneficial ownership includes any shares as to which the
individual has sole or shared voting power or investment power and also
any shares which the individual has the right to acquire within sixty
days of May 15, 1998, through the exercise of any stock option or other
right.
(2) Number of shares deemed outstanding includes 47,047,581 outstanding as of
May 15, 1998, plus any shares subject to stock options held by the person
or persons in question that are exercisable within 60 days of May 15,
1998.
(3) This information was obtained from filings made with the SEC pursuant to
Sections 13(d) or 13(g) of the Exchange Act.
(4) Includes options to purchase 1,100,000 shares of Common Stock exercisable
within 60 days of May 15, 1998.
4
(5) Includes options to purchase 23,432 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(6) Includes options to purchase 35,100 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(7) Includes options to purchase 53,400 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(8) Includes options to purchase 23,850 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(9) Includes options to purchase 23,850 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(10) Includes options to purchase 239,000 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(11) Includes options to purchase 230,200 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(12) Includes options to purchase 170,800 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(13) Includes options to purchase 148,080 shares of Common Stock exercisable
within 60 days of May 15, 1998.
(14) Includes options to purchase 2,731,386 shares of Common Stock exercisable
within 60 days of May 15, 1998.
EXECUTIVE COMPENSATION
The following table sets forth the annual and long-term compensation of the
Named Officers for services to the Company in all capacities during the three
fiscal years ended January 31, 1998:
SUMMARY COMPENSATION TABLE
LONG TERM
ANNUAL COMPENSATION
COMPENSATION AWARDS
----------------- ------------
SECURITIES
NAME AND PRINCIPAL FISCAL UNDERLYING ALL OTHER
POSITION YEAR SALARY BONUS(1) OPTIONS(#) COMPENSATION(2)
------------------ ------ -------- -------- ------------ ---------------
Carol A. Bartz........... 1998 $515,000 $490,125 -- $ 39,000
Chairman of the Board 1997 515,000 -- 560,000 39,000
and Chief Executive 1996 475,000 229,284 -- 38,500
Officer
Eric B. Herr............. 1998 $320,000 $260,000 -- $ 3,000
President and Chief 1997 320,000 -- 280,000 3,000
Operating Officer 1996 310,000 124,926 -- 2,500
Dominic J. Gallello...... 1998 $275,000 $173,125 -- $ 13,576
Vice President, 1997 275,000 -- 210,000 3,000
Mechanical CAD 1996 250,000 125,500 20,000 2,500
Market Group
Godfrey R. Sullivan...... 1998 $260,000 $173,750 -- $ 3,000
Vice President, Personal 1997 260,000 -- 191,000 3,000
Solutions Group 1996 260,000 104,858 20,000 2,500
Michael E. Sutton........ 1998 $250,000 $160,000 -- $139,135
Vice President, 1997 250,000 -- 70,000 179,241
Europe/Middle 1996 222,500 89,806 20,000 99,000
East/Africa
- --------
(1) Represents incentive bonuses for achievement of corporate, individual and
organizational objectives in fiscal years 1996 and 1998.
(2) Amounts reported for fiscal year 1998 consist of: (i) matching
contributions by the Company to one of Autodesk's pre-tax savings plans
(Ms. Bartz $2,500, Mr. Herr $2,500, Mr. Gallello $2,500 and Mr. Sullivan
$2,500); (ii) Autodesk contributions to one of the Company's pre-tax plans
(Ms. Bartz $500, Mr. Herr $500, Mr. Gallello $500 and Mr. Sullivan $500);
(iii) $36,000 paid to Ms. Bartz for the purpose of reimbursing her for
certain transportation expenses; (iv) $10,576 paid to Mr. Gallello for
vacation cashout; (v) $100,000 paid to Mr. Sutton as a cost of living
adjustment related to his location in Switzerland; (vi) $3,621 paid by
5
the Company for health insurance premiums on behalf of Mr. Sutton; and
(vii) $35,514 paid by the Company into an employee retirement fund on
behalf of Mr. Sutton. Amounts reported for fiscal year 1997 consist of:
(i) matching contributions by Autodesk to one of the Company's pre-tax
savings plans (Ms. Bartz $2,500, Mr. Herr $2,500, Mr. Gallello $2,500 and
Mr. Sullivan $2,500); (ii) Autodesk contributions to one of the Company's
pre-tax plans (Ms. Bartz $500, Mr. Herr $500, Mr. Gallello $500 and Mr.
Sullivan $500); (iii) $36,000 paid to Ms. Bartz for the purpose of
reimbursing her for certain transportation expenses; (iv) $100,000 paid to
Mr. Sutton as a cost of living adjustment related to his location in
Switzerland; (v) $3,104 paid by the Company for health insurance premiums
on behalf of Mr. Sutton; and (vi) $76,137 paid by the Company into an
employee retirement fund on behalf of Mr. Sutton. Amounts reported for
fiscal year 1996 consist of: (i) matching contributions by Autodesk to one
of the Company's pre-tax savings plans (Ms. Bartz $2,000, Mr. Herr $2,000,
Mr. Gallello $2,000 and Mr. Sullivan $2,000; (ii) Autodesk contributions to
one of the Company's pre-tax plans (Ms. Bartz $500, Mr. Herr $500, Mr.
Gallello $500 and Mr. Sullivan $500); (iii) $36,000 paid to Ms. Bartz for
the purpose of reimbursing her for certain transportation expenses; and
(iv) $99,000 paid to Mr. Sutton as a cost of living adjustment related to
his location in Switzerland.
OPTION GRANTS
The Company did not grant any options to purchase shares of its Common Stock
to the Named Officers during the fiscal year ended January 31, 1998. The total
number of options granted to all employees during fiscal year 1998 was
3,227,808.
OPTION EXERCISES AND HOLDINGS
The following table sets forth, for each of the Named Officers, certain
information concerning stock options exercised during the Company's 1998
fiscal year, and the number of shares of the Company's Common Stock subject to
both exercisable and unexercisable stock options as of January 31, 1998. Also
reported are values for "in-the-money" options that represent the positive
spread between the respective exercise prices of outstanding stock options and
the fair market value of the Company's Common Stock as of January 31, 1998.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT FISCAL IN-THE-MONEY OPTIONS AT
SHARES YEAR END(#) FISCAL YEAR END
ACQUIRED ON VALUE ------------------------- -------------------------
NAME EXERCISE(#) REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------ ----------- ---------- ----------- ------------- ----------- -------------
Carol A. Bartz.......... 300,000 $7,217,376 1,080,000 440,000 $24,032,500 $6,285,000
Eric B. Herr............ 225,000 $5,937,344 199,000 206,000 $ 3,190,125 $1,320,500
Dominic J. Gallello..... -- -- 203,334 206,666 $ 2,431,251 $2,169,999
Godfrey R. Sullivan..... 120,000 $2,077,877 150,334 190,666 $ 1,924,876 $2,002,249
Michael E. Sutton....... 30,000 $ 382,500 86,694 97,786 $ 885,771 $1,087,339
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
The Compensation Committee of the Board of Directors (the "Compensation
Committee") is currently comprised of three non-employee directors. The
Compensation Committee is responsible for establishing the policies and
programs which determine the compensation of Autodesk's officers. The
Compensation Committee sets base cash compensation and bonus compensation on
an annual basis for the Chief Executive Officer and other executive officers
of the Company. In addition, the Compensation Committee has exclusive
authority to grant stock options to executive officers. The Compensation
Committee considers both internal data, including corporate goals and
individual performance, as well as external data from outside compensation
consultants and independent executive compensation data from comparable high
technology companies, in determining officers' compensation.
6
Compensation Philosophy
When creating policies and making decisions concerning executive
compensation, the Compensation Committee:
. Ensures that the executive team has clear goals and accountability with
respect to corporate performance,
. Establishes pay opportunities that are competitive based on prevailing
practices for the industry, the stage of growth of the Company, and the
labor markets in which Autodesk operates,
. Independently assesses operating results on a regular basis in light of
expected Company performance, and
. Aligns pay incentives with the long-term interests of the Company's
stockholders.
Compensation Program
Autodesk's executive compensation program has three major components, all of
which are intended to attract, retain and motivate highly effective
executives:
1. Base salary for executive officers is set annually by reviewing the
competitive pay practices of comparable high technology companies. Local (San
Francisco Bay Area), national, and, for international executives, foreign
country data are examined and taken into account, along with the skills and
performance of the individual and the needs of the Company.
2. Cash incentive compensation is designed to motivate executives to attain
short-term and longer-term corporate, business unit and individual management
goals. The actual annual cash bonuses received by an executive depend upon
attainment of these specified business goals. The formula for incentive
bonuses for fiscal year 1998 was based on the achievement of certain revenue
growth and operating margin targets, together with the attainment of corporate
goals. It is the intention of the Compensation Committee in fiscal year 1999
to continue this linkage between the achievement of specific financial targets
and corporate goals, and the payment of incentive cash compensation, for
officers and other executives in the Company.
3. Equity-based incentive compensation has been provided to employees and
management through the Company's stock incentive plans. Under these plans,
officers, employees and certain consultants to the Company are eligible to be
granted stock options based on competitive market data, as well as their
responsibilities and position in the Company. These options allow participants
to purchase shares of Autodesk stock at the market price on the date of the
grant, subject to vesting during the participant's employment with the
Company. Employees are also permitted to purchase shares of the Company's
Common Stock, subject to certain limitations, at eighty-five percent (85%) of
fair market value under the Employee Stock Purchase Plan. The purpose of these
stock plans is to instill the economic incentives of ownership and to create
management incentives to improve stockholder value. The Company's stock option
plans utilize vesting periods to encourage employees and executives to remain
with the Company and to focus on longer-term results.
Chief Executive Officer Compensation
In determining Ms Bartz's compensation for the fiscal year ended January 31,
1998, the Compensation Committee reviewed industry surveys of compensation
paid to chief executive officers of comparable companies, with a focus on
those companies located in the San Francisco Bay Area, and evaluated
achievement of corporate individual objectives for the fiscal year. As Ms.
Bartz did not receive a base salary increase for fiscal year 1998, her annual
base compensation for fiscal year 1998 was the same as her salary for fiscal
year 1997, or $515,000. Like other executive officers, Ms. Bartz was eligible
to receive an incentive bonus determined on the basis of (i) the Company's
revenue growth and operating margin and (ii) the achievement of specific
corporate goals. Ms. Bartz received a bonus of $490,125 for fiscal year 1998.
She received an increase in base salary for fiscal year 1999 to $600,000. Ms.
Bartz was granted an option to buy 60,000 shares of Autodesk stock in March
1998. We believe it is critical to the Company's long-term success to continue
to tie the Chief Executive Officer's incentive to the Company's performance
and to align individual financial interests more closely with those of
stockholders.
7
Other Executive Compensation
Autodesk provides certain compensation programs to executives that are also
available to other Company employees, including pre-tax savings plans and
medical/dental/vision benefits. There are no pension programs except where
prescribed by law in countries other than the United States. The Company
generally does not provide executive perquisites such as club memberships. In
fiscal year 1998 the Company introduced a Deferred Compensation Program for
executives.
Deductibility of Executive Compensation
The Internal Revenue Code of 1986, as amended (the "Code"), limits the
federal income tax deductibility of compensation paid to the Company's chief
executive officer and to each of the other four most highly compensated
executive officers. For this purpose, compensation can include, in addition to
cash compensation, the difference between the exercise price of stock options
and the value of the underlying stock on the date of exercise. The Company may
deduct compensation with respect to any of these individuals only to the
extent that during any fiscal year such compensation does not exceed $1
million or meets certain other conditions (such as stockholder approval).
Considering the Company's current compensation plans and policy, the Company
and the Compensation Committee believe that, for the near future, there is
little risk that the Company will lose any significant tax deduction relating
to executive compensation. If the deductibility of executive compensation
becomes a significant issue, the Company's compensation plans and policy will
be modified to maximize deductibility if the Company and the Compensation
Committee determine that such action is in the best interests of the Company.
COMPENSATION COMMITTEE OF THE
BOARD OF DIRECTORS
Crawford W. Beveridge, Chairman
Morton Topfer
Paul S. Otellini
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of the Compensation Committee was or is an officer or employee of
the Company or any of its subsidiaries.
EMPLOYMENT CONTRACTS AND CERTAIN TRANSACTIONS
In April 1992, the Company entered into an agreement with Carol A. Bartz
which provides, among other things, for a severance payment equal to two
years' base salary and incentive compensation in the event Ms. Bartz's
employment is terminated without cause within two years after commencement of
employment or one year after a change of control of the Company not approved
by the Board of Directors or two years' base compensation in the event Ms.
Bartz's employment is terminated without cause under any other circumstances.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of
a registered class of the Company's equity securities, to file reports of
ownership on Form 3 and changes in ownership on Form 4 or 5 with the
Securities and Exchange Commission (the "SEC") and the National Association of
Securities Dealers. Such officers, directors and ten percent stockholders are
also required by SEC rules to furnish the Company with copies of all Section
16(a) forms that they file.
8
Based solely on its review of copies of such reports received or written
representations from certain reporting persons, the Company believes that it
complied with all Section 16(a) filing requirements applicable to its officers,
directors and ten percent (10%) stockholders during the fiscal year ended
January 31, 1998, except that shares received by the following officers under
the Company's Employee Qualified Stock Purchase Plan in March 1996 were
reported on Form 5 statements at the end of fiscal year 1998: Carol Bartz,
James D'Arezzo, Dominic Gallello, Eric Herr, Stephen McMahon, Godfrey Sullivan
and Michael Sutton.
COMPANY STOCK PRICE PERFORMANCE
The following graph shows a five-year comparison of cumulative total return
(equal to dividends plus stock appreciation) for the Company's Common Stock,
the Standard & Poor's 500 Stock Index and the Dow Jones Software Index.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL STOCKHOLDER RETURN*
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
AMONG AUTODESK, S&P 500 INDEX AND PEER GROUP
PERFORMANCE GRAPH APPEARS HERE
Measurement Period S&P DOW JONES
(Fiscal Year Covered) AUTODESK, INC. 500 INDEX SOFTWARE INDEX (DISI)
- ------------------- ------------- --------- ---------------------
Measurement Pt-29/JAN/93 $100 $100 $100
FYE 31/JAN/94 $110 $113 $109
FYE 31/JAN/95 $142 $113 $134
FYE 31/JAN/96 $131 $157 $202
FYE 31/JAN/97 $138 $199 $284
FYE 31/JAN/98 $169 $252 $369
- --------
*Assumes $100 invested January 31, 1993 in the Company's stock, the Standard &
Poor's 500 Stock Index and the Dow Jones Software Index, with reinvestment of
all dividends. Total stockholder returns for prior periods are not an
indication of future investment returns.
9
PROPOSAL TWO
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
On the recommendation of the Audit Committee, the Board of Directors has
appointed Ernst & Young LLP, independent auditors, to audit the consolidated
financial statements of the Company for the fiscal year ending January 31,
1999 and recommends that stockholders vote for ratification of such
appointment. In the event of a negative vote on such ratification, the Board
of Directors will reconsider its selection.
Ernst & Young LLP has audited the Company's financial statements annually
since the fiscal year ended January 31, 1983. Its representatives are expected
to be present at the meeting with the opportunity to make a statement if they
desire to do so and are expected to be available to respond to appropriate
questions.
OTHER MATTERS
The Company knows of no other matters to be submitted to the meeting. If any
other matters properly come before the meeting, it is the intention of the
persons named in the enclosed proxy to vote the shares they represent as the
Board of Directors may recommend.
It is important that your stock be represented at the meeting, regardless of
the number of shares which you hold. You are, therefore, urged to execute and
return the accompanying proxy in the enclosed envelope, at your earliest
convenience.
THE BOARD OF DIRECTORS
Dated: May 22, 1998
10
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PROXY PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF AUTODESK, INC.
1998 ANNUAL MEETING OF STOCKHOLDERS
The undersigned stockholder of AUTODESK, INC., a Delaware corporation,
hereby acknowledges receipt of the Notice of Annual Meeting of Stockholders and
Proxy Statement, each dated May 22, 1998, and hereby appoints Carol A. Bartz and
Marcia K. Sterling, or either of them, proxies and attorneys-in-fact, with full
power of each of substitution, on behalf and in the name of the undersigned, to
represent the undersigned at the 1998 Annual Meeting of Stockholders of
AUTODESK, INC. to be held on June 25, 1998, at 2:00 p.m., at the Embassy Suites
Hotel, 101 McInnis Parkway, San Rafael, California and at any adjournment or
postponement thereof, and to vote all shares of Common Stock that the
undersigned would be entitled to vote if then and there personally present upon
such business as may properly come before the meeting, including the items on
the reverse side of this form.
This proxy, when properly executed, will be voted as directed, or, if no
contrary direction is indicated, will be voted FOR the election of directors,
FOR the ratification of the appointment of Ernst & Young LLP as independent
auditors for the fiscal year ending January 31, 1999, and as said proxies deem
advisable on such matters as may properly come before the meeting.
(Continued and to be signed on the other side.)
- --------------------------------------------------------------------------------
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(continued from reverse side)
AUTODESK, INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY
[ ]
1. ELECTION OF DIRECTORS-
Nominees: Carol A.Bartz; Mark A. Bertelsen;
Crawford W. Beveridge; J. Hallam Dawson;
Paul S. Otellini; Mary Alice Taylor; Morton Topler.
----------------------------------
(Except nominee(s) written above)
FOR ALL
FOR WITHHELD EXCEPT
[_] [_] [_]
2. Proposal to ratify the appointment of Ernst & Young LLP as the Independent
auditors of Autodesk, Inc. for the fiscal year ending January 31, 1999.
FOR WITHHELD ABSTAIN
[_] [_] [_]
(This Proxy should be marked, dated, and
signed by the stockholder(s) exactly as
his or her name appears hereon, and
returned promptly in the enclosed
envelope. Persons signing in a fiduciary
capacity should so indicate. If shares
are held by joint tenants or as
community property, both should sign.)
Dated , 1998
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Signature(s)
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