Autodesk 2011 Annual Report Download - page 34

Based on those factors in aggregate, and the general state of the economy specifically, our executive
officers’ salaries were not increased in fiscal 2011, except for Mr. Bhatt. An increase in Mr. Bhatt’s salary was
approved by the Compensation Committee to recognize his ongoing unique contributions and leadership.
Short-term Cash Incentive Plan
The structure of our stockholder approved short-term cash incentive plan provides the Compensation
Committee with the authority to provide short-term cash incentives that qualify as deductible “performance-
based” compensation within the meaning of Section 162(m) of the Internal Revenue Code, provided that certain
steps are taken each year. If such steps are not taken by the Compensation Committee, our short-term cash
incentive plan still acts as a short-term cash incentive plan, but without qualifying as deductible “performance-
based” compensation within the meaning of Section 162(m) of the Internal Revenue Code. For fiscal 2011, due
in large part to the economic uncertainties at the beginning of fiscal 2011, the Compensation Committee elected
not to take steps under our short-term cash incentive plan to create qualifying deductible “performance-based”
compensation within the meaning of Section 162(m) of the Internal Revenue Code.
Funding of the short-term cash incentive plan was dependent on the achievement of certain revenue and
non-GAAP operating margin levels for fiscal 2011. Details of those amounts are provided below. Non-GAAP
operating margin for fiscal 2011 excluded certain costs and expenses, including stock-based compensation
expense, amortization of certain purchased intangibles, restructuring charges and goodwill impairment charges.
We believe that the use of a non-GAAP operating margin rather than a GAAP operating margin focuses our
executive officers on the on-going operations of our business and encourages long-term growth strategies such as
acquisitions and in-process research and development investments.
Elements of short-term cash incentive plan performance criteria include financial performance targets and
individual performance. All participants share the same financial performance goals, which are focused on
annual revenue growth and profitability, as described in greater detail below. All participants also have unique
annual non-financial individual performance goals that consist of specific business objectives and management
effectiveness goals. Although the financial performance targets are objective and quantitative, the individual
performance goals are subjective, qualitative and permit the Compensation Committee to use discretion in
determining the success of these criteria.
Target Awards
The Compensation Committee set target short-term cash incentive amounts for each eligible participant
based on his or her salary grade. These targets are percentages of such executive officer’s salary, and range from
125% in the case of our CEO to 16.7% in the case of our former Executive Vice President, Sales and Services.
These targets are set against each executive officer’s annualized base salary. An executive officer may receive
amounts below or above this target award. Target awards for our Named Executive Officers under the short-term
cash incentive plan were each approximately:
Short-Term Cash Incentive Plan Participant
Short-Term Cash
Incentive Target
(as % of base salary)
Carl Bass, Chief Executive Officer and President .......................... 125%
Mark J. Hawkins, Executive Vice President and Chief Financial Officer ........ 75%
George M. Bado, former Executive Vice President, Sales and Services ......... 16.7%
Jay Bhatt, Senior Vice President, Architecture, Engineering and Construction . . . 75%
Pascal W. Di Fronzo, Senior Vice President, General Counsel & Secretary ...... 75%
28