Autodesk 2007 Annual Report Download - page 34

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Stock Plans and Stock Grant Policies/Practices
Autodesk maintains the 2006 Employee Stock Plan for stock option grants exclusively for Autodesk
employees, including executive officers. In addition, the Company’s employees are eligible to participate
in Autodesk’s 1998 Employee Qualified Stock Purchase Plan.
Our broad-based employee stock option program is designed to promote long-term retention and
recognize individual performance. Generally, all employees are eligible to participate. Approximately
80 percent of the options granted during fiscal 2007 were awarded to employees other than Named
Executive Officers.
Guidelines are based on competitive market practice for grants for new hires, promotions, and ongoing
performance-related grants. Typically, an employee is eligible for a stock option grant upon beginning
employment with the Company (if the stock option program is available in that country location) and is
eligible to be considered for periodic grants thereafter. The size of grants is influenced by the prevailing
guidelines and the individual’s performance or particular requirements at the time of hire.
• Voluntary Stock Option Review
During fiscal 2007, the Audit Committee of Autodesk’s Board of Directors conducted a voluntary
review of Autodesk’s historical stock option granting practices and related issues. For a full discussion
of our voluntary stock option review, please refer to the “Explanatory Note,” “Note 2. Restatement of
Consolidated Financial Statements” and “Item 9A. Controls and Procedures” in our fiscal year 2007
Annual Report on Form 10-K.
• Stock Grant Process
All stock option grants to executive officers are made by the Committee. In March 2005, the Board
of Directors modified the delegation of authority to the Company’s chief executive officer to grant
stock awards and approve monthly performance, promotion, new hire, and patent award grants for
employees other than the Company’s executive officers on a predetermined date. The specified date
was the second Thursday of each month, or the next business day in case of a holiday, or as close to
such date as was reasonably possible.
In September 2006, the Committee discontinued the delegation of authority to the chief executive
officer and began approving all employee grants at its regularly scheduled quarterly meetings. The
Committee approves stock option grants to newly hired executive officers at the quarterly meeting
following the executive’s hire date. It also approves promotion and performance grants. For executive
promotions, the Committee approves promotion grants at the Committee meeting at which the
promotion is approved, or at the next quarterly Committee meeting following the promotion.
Approval of performance grants is scheduled to occur at the quarterly Committee meetings.
The Committee typically reviews and approves performance grants for executives once or twice
a year. The Committee considers several factors, including the unvested option position of each
executive, the value of those options compared to other Autodesk senior executives, competitive
pay practices within the peer group of companies, and the individual performance of the executive.
The Committee uses “new hire” and “ongoing” stock grant guidelines in determining the appropriate
size of these grants. The stock grant guidelines reflect the range of typical competitive practices of
our peer group. The Committee has authority to exceed these guidelines, within the limits prescribed
under the stock plan approved by shareholders. The current plan limits any individual grant to
1,000,000 stock options. For fiscal 2007, the maximum grant awarded was 750,000 to Carl Bass to
recognize his promotion to chief executive officer.