8-KMaterial Agreements

Autodesk, Inc. 8-K Report, Material Agreement (Mar 14, 2006)

Filed March 14, 2006For Securities:ADSK

Summary

Autodesk, Inc. filed an 8-K on March 14, 2006, reporting on executive compensation decisions made by its Compensation and Human Resources Committee on March 9, 2006. The report details the framework for the company's Executive Incentive Plan for fiscal year 2007, including identified participants, target award percentages, and the performance metrics for bonus payouts. These metrics are tied to revenue growth and operating margin targets, designed to align executive incentives with company performance and potentially qualify for tax benefits under Section 162(m) of the Internal Revenue Code. Furthermore, the filing announces significant changes to the compensation and role of Carl Bass. Effective May 1, 2006, upon his promotion to President and Chief Executive Officer, Mr. Bass will receive a salary increase to $700,000 and be granted an option to purchase 750,000 shares of Autodesk common stock. Investors should note these developments as they indicate a transition in leadership and a direct tie between executive compensation and company stock performance.

Key Highlights

  • 1Autodesk established the framework for its Executive Incentive Plan for Fiscal Year 2007, linking executive bonuses to revenue growth and operating margin targets.
  • 2Key executives, including Carol Bartz and Carl Bass, are identified as participants in the Fiscal Year 2007 incentive plan.
  • 3Bonus payouts are contingent upon achieving specific revenue growth compared to Fiscal Year 2006 and meeting certain operating margin levels.
  • 4The plan is designed to comply with Section 162(m) of the Internal Revenue Code, allowing for performance-based compensation.
  • 5The Compensation Committee retains discretion to reduce or eliminate bonuses, but not increase them, based on performance.
  • 6Carl Bass's salary will increase to $700,000 effective May 1, 2006, coinciding with his promotion to President and CEO.
  • 7Carl Bass will be granted an option to purchase 750,000 shares of Autodesk common stock at fair market value upon his promotion.

Frequently Asked Questions

This 8-K filing primarily announces decisions made by Autodesk's Compensation and Human Resources Committee regarding executive compensation for the upcoming fiscal year 2007. It details the structure of the Executive Incentive Plan and significant compensation changes for a key executive.

Bonuses for eligible executives will be based on achieving specific performance targets related to revenue growth (compared to Fiscal Year 2006) and operating margin levels. The actual payout will depend on how well these goals are met, and the Compensation Committee has the discretion to adjust payouts downwards.

Effective May 1, 2006, Carl Bass will be promoted to President and Chief Executive Officer. His annual salary will be increased to $700,000, and he will receive an option to purchase 750,000 shares of Autodesk common stock at the then-current fair market value.

Yes, a key condition is that each executive must remain an employee of Autodesk throughout the entire fiscal year 2007 to be eligible for any bonus payout under the plan.