Autodesk 2006 Annual Report Download - page 112

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Note 8. Stockholders’ Equity
Preferred Stock
Under Autodesk’s Certificate of Incorporation, 2.0 million shares of preferred stock are authorized. At
January 31, 2006, there were no preferred shares issued or outstanding. The Board of Directors has the authority
to issue the preferred stock in one or more series and to fix rights, preferences, privileges and restrictions,
including dividends, and the number of shares constituting any series or the designation of such series, without
any further vote or action by the stockholders.
Autodesk entered into a Preferred Shares Rights Agreement dated December 14, 1995, as amended (the
“Rights Agreement”). At the close of business on December 14, 2005, pursuant to the terms of the Rights
Agreement, the Rights expired, effectively terminating the Rights Agreement.
Common Stock
In March 2005, the Board of Directors approved an amendment to the Company’s Certificate of
Incorporation to increase the authorized common stock ofthe Company from400.0 million shares to 750.0 million
shares. This amendment was approved by the stockholders of the Company at its annual meeting in June 2005.
Common Stock Repurchase Programs
Autodesk repurchased and retired 11.7 million shares in fiscal 2006 at an average repurchase price of
$38.10 per share, 25.9 millionshares in fiscal 2005 at an average repurchase price of $21.08 per share and 18.1 million
shares in fiscal 2004 at an average repurchase price of $9.85 per share. The purpose of the stock repurchase
program is to help offset the dilution to net income per share caused by the issuance of stock under Autodesk’s
employee stock plans and to more effectively utilize excess cash generated from its business.
Between November 1999 and December 2004, the Board of Directors approved plans to repurchase up
to 144.0 million shares of Autodesk common stock. Of these 144.0 million shares, 123.5 million shares
were repurchased and retired as of January 31, 2006. The number of shares acquired and the timing of the
purchases are based on several factors, including general market conditions and the trading price of Autodesk
common stock.
In fiscal 2006, 2005 and 2004, Autodesk repurchased its common stock through open market purchases.
Dividends
During fiscal 2005 and 2004, Autodesk paid annual cash dividends of $0.06 per share at a rate of $0.015 each
quarter, reducing retained earnings by $13.5 million and $13.4 million, respectively. Autodesk discontinued the
payment of cash dividends after the dividend payable for the fourth quarter of fiscal 2005, was paid in April 2005.
Note 9. Employee and Director Benefit Plans
Stock Option Plans
As of January 31, 2006, Autodesk maintained two active stock option plans for the purpose of granting stock
options to employees and members of Autodesk’s Board of Directors: the 1996 Stock Plan (available only to
employees) and the 2000 Directors’ Option Plan (available only to non-employee directors). Additionally, there
are six expired or terminated plans with options outstanding, including the Nonstatutory Stock Option Plan
(available only to non-executive employees and consultants) which was terminated by the Board of Directors
(the “Board”) in December 2004. Autodesk does not have a practice of awarding stock options to consultants.
AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
66