Autodesk 2008 Annual Report Download - page 141

AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
1998 Employee Qualified Stock Purchase Plan
Under Autodesk’s ESP Plan, which was approved by stockholders in 1998, eligible employees may
purchase shares of Autodesk’s common stock at their discretion using up to 15% of their compensation subject to
certain limitations, at not less than 85% of fair market value as defined in the plan agreement. At January 31,
2008, a total of 22.1 million shares were available for future issuance. This amount will automatically be
increased on the first trading day of each fiscal year by an amount equal to the lesser of 10.0 million shares or
2.0% of the total of (1) outstanding shares plus (2) any shares repurchased by Autodesk during the prior fiscal
year. Under the ESP Plan, the Company issues shares on March 31 and September 30 of each fiscal year. The
provisions of this plan expire during fiscal 2018.
On August 17, 2006, Autodesk disclosed that the Audit Committee of the Board of Directors was
conducting a voluntary review of Autodesk’s historical stock option granting practices and related accounting
issues. Due to the this review, Autodesk was not current with its reporting obligations under the Securities
Exchange Act of 1934 until June 2007, and suspended contributions and purchases under the ESP Plan during the
third quarter of fiscal 2007 and the first quarter of fiscal 2008. On September 18, 2006, Autodesk’s Board of
Directors approved an amendment to the Company’s ESP Plan which provided for active participant employees
at the time of the suspension to become automatically enrolled in the next offering period, unless they elected not
to participate. The Board of Directors also approved a one-time cash bonus of $8.8 million to non-executive
employees enrolled in the ESP Plan at that date. This bonus approximated the profits employee participants
would have made on the scheduled September 30, 2006 exercise date, had the purchases been made and the
shares been sold on the next trading day at close of market, and was expensed as additional compensation
expense at the time it was paid. On March 22, 2007, Autodesk’s Board of Directors approved an amendment,
which superseded the September 18, 2006 amendment, which provided for active participant employees at the
time of the suspension to become automatically enrolled in the next offering period ending in September 2007,
unless they elected not to participate. In June 2007 the Company became current with its financial filings and
resumed employee contributions to the ESP Plan.
Autodesk issued 0.8 million shares at an average price of $28.96 per share in fiscal 2008, 0.8 million shares
at an average price of $22.46 per share in fiscal 2007, and 1.9 million shares at an average price of $17.99 per
share in fiscal 2006. The weighted average grant date fair value of awards granted under the ESP Plan during
fiscal 2008, 2007 and 2006, calculated as of the award grant date using the Black-Scholes-Merton option pricing
model, was $16.77, $12.21 and $14.36 per share respectively.
Tender Offer
On June 4, 2007, after Autodesk became current with its reporting obligations under the Securities
Exchange Act of 1934, the Company filed a Tender Offer Statement on Schedule TO with the SEC. The tender
offer extended an offer by Autodesk to holders of certain outstanding stock options granted under the Company’s
1996 Stock Plan and Nonstatutory Stock Option Plan (the “Stock Plans”) to amend the exercise price on certain
of their outstanding options. The purpose of the tender offer was to amend the exercise price on options to have
the same price as the fair market value on revised measurement dates that were identified during the Company’s
voluntary review of its historical stock option grant practices. As part of this tender offer, the Company paid a
cash bonus of $4.8 million in January 2008 to reimburse optionees who elected to participate in the tender offer
for any increase in the exercise price of their options resulting from the amendment. The impact of the bonus,
which was recorded during the second quarter of fiscal 2008, resulted in a decrease to additional paid-in capital
of $4.4 million, an increase in stock-based compensation expense of $0.3 million and an increase in payroll tax
expenses of $0.2 million.
65
2008 Annua
l Report