def14a
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE
14A INFORMATION
PROXY
STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
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ACTUATE CORPORATION
(Name of Registrant as Specified In Its Charter)
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TABLE OF CONTENTS
ACTUATE CORPORATION
2207 Bridgepointe Parkway, Suite 500
San Mateo, California 94404
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 21,
2008
To our Stockholders:
The Annual Meeting of Stockholders of Actuate Corporation (the
Corporation or Actuate) will be held at
Actuates corporate headquarters, located at 2207
Bridgepointe Parkway, Suite 500, San Mateo, California
94404, on Wednesday, May 21, 2008, at 9:00 a.m. for
the following purposes:
1. To elect six directors of the Board of Directors to
serve until the next Annual Meeting or until their successors
have been duly elected and qualified;
2. To ratify the appointment of KPMG LLP as the
Corporations Independent Registered Public Accountants for
the fiscal year ending December 31, 2008; and
3. To transact such other business that may be approved by
the Board of Directors or may otherwise properly come before the
Annual Meeting.
The foregoing items of business are more fully described in the
attached Proxy Statement.
Only stockholders of record at the close of business on
April 7, 2008 are entitled to notice of, and to vote at,
the Annual Meeting and at any adjournments or postponements
thereof. A list of such stockholders will be available for
inspection at Actuates headquarters located at 2207
Bridgepointe Parkway, Suite 500, San Mateo, California
94404, during ordinary business hours for the
ten-day
period prior to the Annual Meeting.
By Order Of The Board Of Directors,
Nicolas C. Nierenberg
Chairman of the Board
and Chief Architect
San Mateo, California
April 16, 2008
IMPORTANT
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE
COMPLETE, SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY
IN THE ENCLOSED POSTAGE-PAID ENVELOPE. YOU MAY REVOKE YOUR PROXY
AT ANY TIME PRIOR TO THE ANNUAL MEETING. IF YOU DECIDE TO ATTEND
THE ANNUAL MEETING AND WISH TO CHANGE YOUR PROXY VOTE, YOU MAY
DO SO AUTOMATICALLY BY VOTING IN PERSON AT THE MEETING.
ACTUATE CORPORATION
2207 Bridgepointe Parkway, Suite 500
San Mateo, California 94404
FOR ANNUAL MEETING OF
STOCKHOLDERS
To Be Held May 21,
2008
These proxy materials are furnished in connection with the
solicitation of proxies by the Board of Directors of Actuate
Corporation (Actuate or the Corporation)
for the Annual Meeting of Stockholders (the Annual
Meeting) to be held at Actuates corporate
headquarters located at 2207 Bridgepointe Parkway,
Suite 500, San Mateo, California 94404, on Wednesday,
May 21, 2008, at 9:00 a.m., and at any adjournment or
postponement of the Annual Meeting. These proxy materials were
first mailed to stockholders on or about April 16, 2008.
PURPOSE
OF MEETING
The specific proposals to be considered and acted upon at the
Annual Meeting are summarized in the accompanying Notice of
Annual Meeting of Stockholders. Each proposal is described in
more detail in this Proxy Statement.
VOTING
RIGHTS AND SOLICITATION OF PROXIES
Actuates Common Stock is the only type of security
entitled to vote at the Annual Meeting. On April 7, 2008,
the record date for determination of stockholders entitled to
vote at the Annual Meeting, there were 60,496,508 shares of
Common Stock outstanding. Each stockholder of record on
April 7, 2008 is entitled to one vote for each share of
Common Stock held by such stockholder on April 7, 2008. All
votes will be tabulated by the inspector of election appointed
for the meeting, who will separately tabulate affirmative and
negative votes, abstentions and broker non-votes.
Quorum
Required
Fifty percent (50%) of Actuates issued and outstanding
Common Stock entitled to vote at the Annual Meeting, present in
person or represented by proxy, shall constitute a quorum for
the transaction of business at the Annual Meeting. Abstentions
and broker non-votes will be counted as present for the purpose
of determining the presence of a quorum.
Votes
Required
Proposal 1. Directors are elected by a
plurality of the affirmative votes of the shares present in
person or represented by proxy and entitled to vote at the
Annual Meeting. The six nominees for director receiving the
highest number of affirmative votes will be elected. Withheld
votes and broker non-votes will have no effect in the outcome of
the election of directors.
Proposal 2. Ratification of the
appointment of KPMG LLP as Actuates Independent Registered
Public Accountants for the fiscal year ending December 31,
2008 requires the affirmative vote of a majority of those shares
present in person or represented by proxy and entitled to vote
on Proposal 2. An abstention on Proposal 2 has the
effect of a vote against the proposal because it requires the
affirmative vote of a majority of the shares present in person
or represented by proxy and entitled to vote at the meeting.
Broker non-votes will have no effect on the outcome of
Proposal 2 because shares represented by such broker
non-votes are not considered present and entitled to vote with
respect to the matter.
Proxies
Whether or not you are able to attend the Annual Meeting, you
are urged to complete and return the enclosed proxy, which is
solicited by Actuates Board of Directors and which will be
voted as you direct on your proxy when
properly completed. In the event no directions are specified,
such proxies will be voted FOR the nominees of the Board of
Directors as set forth in Proposal 1 and FOR
Proposal 2 and in the discretion of the proxy holders as to
other matters that may properly come before the Annual Meeting.
You may also revoke or change your proxy at any time before the
Annual Meeting. To do this, send a written notice of revocation
or another signed proxy with a later date to the Secretary of
Actuate Corporation at Actuates principal executive
offices before the beginning of the Annual Meeting. You may also
automatically revoke your proxy by attending the Annual Meeting
and voting in person. All shares represented by a valid proxy
received prior to the Annual Meeting will be voted.
Solicitation
of Proxies
Actuate will bear the entire cost of solicitation, including the
preparation, assembly, printing and mailing of this Proxy
Statement, the proxy and any additional soliciting material
furnished to stockholders. Copies of solicitation material will
be furnished to brokerage houses, fiduciaries and custodians
holding shares in their names that are beneficially owned by
others so that they may forward this solicitation material to
such beneficial owners. In addition, Actuate may reimburse such
persons for their costs of forwarding the solicitation material
to such beneficial owners. The original solicitation of proxies
by mail may be supplemented by solicitation by telephone,
telegram, or other means by directors, officers, employees, or
at Actuates request, The Altman Group (AG) a
professional proxy solicitation firm. No additional compensation
will be paid to directors, officers or employees for such
services, but AG will be paid its customary fee, estimated to be
$1,870, for search and distribution services.
PROPOSAL 1
ELECTION
OF DIRECTORS
The directors who are being nominated for re-election to the
Board of Directors (the Nominees), their ages as of
April 1, 2008, their positions and offices held with
Actuate and certain biographical information are set forth
below. In the event any Nominee is unable or declines to serve
as a director at the time of the Annual Meeting, the proxies
will be voted for any nominee who may be designated by the
present Board of Directors to fill the vacancy. As of the date
of this Proxy Statement, the Board of Directors is not aware of
any Nominee who is unable or will decline to serve as a
director. The six Nominees receiving the highest number of
affirmative votes of the shares entitled to vote at the Annual
Meeting will be elected directors of Actuate to serve until the
next Annual Meeting or until their successors have been duly
elected and qualified.
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Nominees
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Positions and Offices Held with Actuate
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Nicolas C. Nierenberg
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Chairman of the Board and Chief Architect
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Peter I. Cittadini
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Director, President and Chief Executive Officer
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George B. Beitzel
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Director
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Kenneth E. Marshall
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Director
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Arthur C. Patterson
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Director
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Steven D. Whiteman
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Director
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Nicolas C. Nierenberg, 51, has been Chairman of the Board
of Directors since he co-founded Actuate in November 1993 and
became its Chief Architect in August 2000. Mr. Nierenberg
was also Chief Executive Officer of Actuate from November 1993
until August 2000 and President from November 1993 until October
1998. Prior to founding Actuate, from April 1993 to November
1993, Mr. Nierenberg worked as a consultant for Accel
Partners, a venture capital firm, evaluating investment
opportunities in the enterprise software market. Prior to that,
Mr. Nierenberg co-founded Unify Corporation, which develops
and markets relational database development tools.
Mr. Nierenberg held a number of positions at Unify
including, Chairman of the Board of Directors, Chief Executive
Officer, President, Vice President, Engineering and Chief
Technical Officer. Mr. Nierenberg is currently a director
for privately held companies AwarePoint Corporation, Aptana,
Inc. and Photoleap, Inc., and is a member of the Board of
Trustees for The Burnham Institute, a non-profit organization.
Peter I. Cittadini, 52, has been a director of Actuate
since February 1999. Mr. Cittadini has been Chief Executive
Officer of Actuate since August 2000 and has been its President
since October 1998. Mr. Cittadini was also Actuates
Chief Operating Officer from October 1998 until August 2000 and
served as Actuates Executive
2
Vice President from January 1995 to October 1998. From 1992 to
1995, Mr. Cittadini held a number of positions at
Interleaf, Inc., an enterprise software publishing company,
including Senior Vice President of Worldwide Operations
responsible for worldwide sales, marketing, customer support and
services. From 1985 to 1991, Mr. Cittadini held a number of
positions at Oracle Corporation, including Vice President,
Northeast Division.
George B. Beitzel, 79, has been a director of Actuate
since February 2000. From 1955 until his retirement in 1987,
Mr. Beitzel held numerous positions at IBM, including
serving as a member of the IBM Board of Directors and Corporate
Office. During his career, Mr. Beitzel has served as a
director of a number of companies including Datalogix,
FlightSafety, Phillips Petroleum, Roadway Express,
Rohm & Haas and Square D. Mr. Beitzel currently
serves as director of Bitstream, Inc., Computer Task Group,
Inc., and Gevity HR, Inc. Mr. Beitzel also currently serves
as a director of Deutsche Bank Trust Company Americas, a
wholly owned subsidiary of Deutsche Bank AG for thirty years.
Kenneth E. Marshall, 55, has been a director of Actuate
since January 2001. Mr. Marshall is Chairman of the Board
of Directors and CEO of Extraprise, Inc., a provider of
integrated customer relationship management solutions, which he
founded in April 1997. From November 1995 to November 1996,
Mr. Marshall served as President and COO of Giga
Information Group, an information technology advisory company.
From January 1990 to June 1995, Mr. Marshall served as
President and CEO of Object Design, Inc., an object-oriented
database company. From March 1985 to December 1989,
Mr. Marshall worked for Oracle Corporation, where he served
as an Oracle group Vice President and was the founder of
Oracles consulting services business. Mr. Marshall
currently serves as a director of privately held company
StreamBase Systems.
Arthur C. Patterson, 64, has been a director of Actuate
since November 1993 and was appointed lead outside director in
May 2004. Mr. Patterson is a partner of Accel Partners, a
venture capital firm, which he founded in 1983.
Mr. Patterson currently serves as a director of iPass Inc.,
MetroPCS Communications, Inc. and several privately held
enterprise software and communications companies.
Steven D. Whiteman, 57, has been a director of Actuate
since April 1998. Since January 2005, Mr. Whiteman has
worked as an independent consultant. From May 2001 to December
2004, Mr. Whiteman was President and Chief Executive
Officer of Intesource, Inc., a privately held procurement
solutions company, where he currently serves on the board of
directors. From June 2000 to May 2002, Mr. Whiteman worked
as an independent consultant. From June 1997 to June 2000,
Mr. Whiteman held a number of positions, including Chairman
of the Board, Chief Executive Officer and President at Viasoft,
Inc., a software application and services company. In addition
to serving as a director of Intesource, Mr. Whiteman
currently serves as a director of privately held company Netpro
Computing and as a director of Unify Corporation.
Board of
Directors Meetings and Committees
The Board of Directors held six meetings during the fiscal year
ended December 31, 2007. During 2007, no director attended
fewer than seventy-five percent of the aggregate of (i) the
total number of meetings of the Board of Directors held during
the period he served as a Director and (ii) the total
number of meetings held by committees of the Board on which he
served, during the periods that he served.
The Board of Directors currently has three standing committees:
the Audit Committee, the Compensation Committee and the
Corporate Governance/Nominating Committee.
Audit Committee The principal functions of
the Audit Committee are to monitor the integrity of
Actuates financial statements; oversee the accounting and
financial reporting process and the systems of internal
accounting and financial controls; review the qualifications
(including independence) and performance of the Independent
Registered Public Accountants; and oversee compliance with
Actuates ethics policies and applicable legal and
regulatory requirements. The Audit Committee met five times
during 2007. The Audit Committee acts pursuant to a written
charter adopted by the Board which can be viewed at
www.actuate.com. Messrs. Beitzel, Marshall and Whiteman
serve on the Audit Committee and the Board has determined that
each of them is an independent director under the applicable
listing standards of Nasdaq. The Board has determined that
Mr. Whiteman is an audit committee financial expert as
defined in the rules of the Securities and Exchange Commission.
3
Compensation Committee The Compensation
Committee reviews and sets the compensation for Actuates
Chief Executive Officer and certain of its other executive
officers, evaluates the performance of the executive officers,
and oversees the administration of Actuates equity
compensation plans. The Compensation Committee reviews and
recommends to the Board of Directors the compensation of the
non-employee directors. The Compensation Committee met four
times during 2007. The Compensation Committee acts pursuant to a
written charter adopted by the Board that can be viewed at
www.actuate.com. Messrs. Beitzel, Marshall and Whiteman
serve on the Compensation Committee and the Board has determined
that each of them is an independent director under the
applicable listing standards of Nasdaq.
The Compensation Committee is authorized to use independent
compensation consultants and other professionals to assist in
the design, formulation, analysis and implementation of
compensation programs for the Corporations executive
officers and other key employees and non-employee directors. In
2007, the Compensation Committee engaged the compensation
consulting firm Compensia to identify Actuates peer group
for compensatory purposes, to help it determine appropriate
levels of compensation for its executive officers and to
otherwise provide advice about executive compensation best
practices.
In determining or recommending the amount or form of executive
officer compensation each year, the Compensation Committee
generally considers the recommendations of compensation
consultants engaged by Actuate
and/or the
Compensation Committee, compensation surveys, such as Radford
Group surveys and the High-Tech Executive TDC Survey and
recommendations from Actuates Chief Executive Officer with
respect to the compensation of other executive officers based on
his annual review of their performance.
Corporate Governance/Nominating Committee The
Corporate Governance/Nominating Committee is responsible for
overseeing Actuates corporate governance policies and
processes and evaluating and recommending qualified candidates
to election to the Board of Directors. The Corporate
Governance/Nominating Committee met twice during 2007. The
Corporate Governance/Nominating Committee acts pursuant to a
written charter adopted by the Board that can be viewed on our
website at www.actuate.com. Messrs. Beitzel, Marshall and
Whiteman serve on the Corporate Governance/Nominating Committee
and the Board has determined that each of them is an independent
director under the applicable listing standards of Nasdaq.
The Corporate Governance/Nominating Committee does not have a
formal policy with regard to the process for identifying and
evaluating director nominees. The Corporate
Governance/Nominating Committee will give the same consideration
to director candidates recommended by the Corporations
stockholders as those candidates recommended by others. To
recommend a candidate for the Corporate Governance/Nominating
Committees consideration, a stockholder should submit the
candidates name and qualifications to the
Corporations corporate secretary in writing at the
following address: 2207 Bridgepointe Parkway, Suite 500,
San Mateo, CA 94404. To date, Actuate has not received
director candidates recommended by its stockholders and the
Board of Directors believes that it could appropriately address
any such recommendations received without a formal policy.
Stockholders may communicate with the Board of Directors by
sending a letter to the Corporations corporate secretary
at the following address: 2207 Bridgepointe Parkway,
Suite 500, San Mateo, California 94404. Stockholders
who would like their submission directed to a particular member
of the Board of Directors by the corporate secretary may so
specify.
The Board of Directors has determined that, except as noted
below, all members of the Board are independent
directors within the meaning of the applicable listing
standards of Nasdaq. Messrs. Cittadini and Nierenberg are
not considered independent because they are executive officers
of Actuate.
Although Actuate does not have a formal policy regarding
attendance by members of the Board of Directors at annual
meetings of stockholders, directors are encouraged to attend
annual meetings. No directors attended the 2007 annual meeting
of stockholders.
Recommendation
of the Board of Directors
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
THE NOMINEES LISTED HEREIN.
4
PROPOSAL 2
RATIFICATION
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
The Audit Committee has selected KPMG LLP, Independent
Registered Public Accountants (KPMG) as
Actuates Independent Registered Public Accountants for
2008. Representatives from KPMG are expected to be at the Annual
Meeting. They will have the opportunity to make a statement and
will be available to respond to appropriate stockholder
questions.
The affirmative vote of the holders of a majority of shares
present or represented by proxy and entitled to vote on this
proposal will be required to ratify the appointment of KPMG. In
the event the stockholders fail to ratify the appointment, the
Board of Directors will reconsider its selection. Even if the
appointment is ratified, the Board of Directors, in its
discretion, may direct the appointment of a different
independent accounting firm at any time during the year if the
Board of Directors has concluded that such a change would be in
Actuates and its stockholders best interests.
Principal
Accounting Fees and Services
During fiscal years 2007 and 2006, we retained KPMG to provide
services in the following categories and amounts:
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Fee Category
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2007
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2006
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Audit Fees
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$
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1,412,951
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$
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1,853,121
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Audit-Related Fees
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47,500
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Tax Fees
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All Other Fees
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Total
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$
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1,412,951
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$
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1,900,621
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Audit fees include the audit of Actuates annual financial
statements, review of financial statements included in each of
our Quarterly Reports on
Form 10-Q,
and services that are normally provided by KPMG in connection
with statutory and regulatory filings or engagements for those
fiscal years.
Audit-related fees consist of fees for assurance and related
services that are reasonably related to the performance of the
audit or review of our financial statements.
Tax fees consist of fees for professional services for tax
compliance, tax advice and tax planning. This category includes
fees related to the preparation and review of federal, state and
international tax returns and assistance with tax audits.
All other fees include assurance services not related to the
audit or review of our financial statements.
The Audit Committee determined that the rendering of non-audit
services by KPMG is compatible with maintaining the independence
of KPMG.
Recommendation
of the Board of Directors
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
PROPOSAL 2.
5
2007
COMPENSATION OF NON-EMPLOYEE DIRECTORS
The following table sets forth certain information regarding the
compensation of each non-employee director for the 2007 fiscal
year. The Corporation does not sponsor any non-equity incentive
plan, pension plan, or non-qualified deferred compensation plan
for its non-employee directors. No stock or stock-based awards
other than stock options were granted to the non-employee
directors in 2007, and no stock awards other than option grants
were held by non-employee directors in 2007.
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Fees Earned
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or Paid in Cash
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Option Awards
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Total
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Name
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($)(1)
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($)(2)(3)
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($)
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(a)
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(b)
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(c)
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(d)
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George B. Beitzel
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50,000
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99,131
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149,131
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Kenneth E. Marshall
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50,000
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98,983
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148,983
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Arthur C. Patterson
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50,000
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98,393
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148,393
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Steven D. Whiteman
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50,000
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98,393
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148,393
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Consists of the annual cash retainer fees paid to non-employee
directors for service as members of the Corporations Board
of Directors. For further information concerning such fees, see
the section below entitled Directors Annual Cash
Retainer Fees. |
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(2) |
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The amounts in column (c) reflect the compensation cost
recognized for financial statement reporting purposes for the
fiscal year ended December 31, 2007, in accordance with
Statement of Financial Accounting Standards No. 123 revised
(SFAS 123(R)), with respect to the outstanding
stock option awards made to non-employee directors for service
on the Corporations Board of Directors, whether those
awards were made in 2007 or any earlier fiscal year. The
reported amounts are based on the grant date fair value of each
of those options and have not been adjusted for the potential
impact of estimated forfeitures. Assumptions used in the
calculation of the SFAS 123(R) cost are included in
Note 1 of the Notes to Consolidated Financial Statements in
our 2007 Annual Report on
Form 10-K
filed with the Securities and Exchange Commission on
March 14, 2007. The grant date fair value of each of the
stock options granted to the non-employee directors during 2007,
computed in accordance with SFAS 123(R), was $100,580. For
further information concerning such equity awards, see the
section below entitled Equity Compensation. |
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(3) |
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As of December 31, 2007, the following non-employee
directors held options to purchase the following number of
shares of the Corporations common stock: George B. Beitzel
290,000 shares; Kenneth E. Marshall 337,500 shares;
Arthur C. Patterson 270,000 shares and Steven D. Whiteman
280,212 shares. The options were granted under either the
Corporations 1998 Plan or the Corporations 1998
Non-Employee Directors Plan (the Directors
Plan). For further information concerning the grant of
options to non-employee directors under such plans, see the
section below entitled Equity Compensation. |
Directors
Annual Cash Retainer Fees
In 2007, Messrs. Beitzel, Marshall, Patterson and Whiteman
each received a cash retainer of $50,000 for their service as
non-employee directors. Directors were also reimbursed for
reasonable expenses incurred in connection with their attendance
at a board or committee meeting.
Equity
Compensation
2006
Grants and Grants in Prior Years Pursuant to the Directors
Plan
In 2006 and in prior years, each individual who first joined the
Board of Directors as a non-employee director, whether through
election or appointment, automatically received an option award
under the Directors Plan to purchase 80,000 shares of
Common Stock. Such initial automatic option grant vested and
became exercisable as to 25% of the shares after one year of
Board service and the balance of the shares vested and became
exercisable in a series of 36 equal monthly installments over
the 36 month period measured from the first anniversary of
the option grant date, provided the non-employee Board member
continued his or her Board service throughout each such vesting
date. In addition, at each annual stockholders meeting
during that period, each continuing non-employee
6
director was automatically granted at that meeting, whether or
not standing for re-election at that particular meeting, a stock
option under the Directors Plan to purchase
10,000 shares of Common Stock, which became fully vested
and exercisable upon completion of one year of Board service
measured from the date of grant. Each option had an exercise
price set equal to the fair market value of the Common Stock on
the automatic grant date and a maximum term of ten years,
subject to earlier termination following the optionees
cessation of Board service. However, vesting automatically
accelerated in full upon (i) an approved acquisition of
Actuate by merger or consolidation, (ii) sale of all or
substantially all of Actuates assets, (iii) the
successful completion of a tender or exchange offer for
securities possessing more than fifty percent (50%) of the total
combined voting power of Actuates outstanding securities,
or (iv) the death or disability of the optionee while
serving as a Board member.
2007
Awards 2008 Awards and Future Awards Pursuant to the 1998
Plan
In March 2007, the Board of Directors amended the stock option
award program for non-employee directors under the
Directors Plan to change the number of options granted in
the initial and annual awards to non-employee directors,
beginning with the awards to be made at the 2007 Annual Meeting.
The amendment reduced the number of options to be granted to
each individual who first joins the Board as a non-employee
director from 80,000 options to 40,000 options and increased the
number of options to be automatically granted to each continuing
non-employee Board member at each annual stockholders
meeting from 10,000 options to 25,000 options. All other terms
of the non-employee director program, including vesting
schedules for the initial award and the automatic annual award
remained unchanged.
All directors are eligible to receive option awards under
Actuates Amended and Restated 1998 Equity Incentive Plan
(the 1998 Plan).
In January 2008, the Board of Directors resolved that starting
with the awards to be made at the 2008 Annual Meeting all awards
to the non-employee directors shall be made under the 1998 Plan
rather than the Directors Plan. All other terms of the
non-employee director program, including vesting schedules for
the initial award and the automatic annual award remain
unchanged.
Additional
Director Grants
Nicolas C. Nierenberg, Chairman of the Board and Chief
Architect, is an executive officer who does not receive
additional compensation for services provided as Chairman of the
Board. As of February 29, 2008, Mr. Nierenberg held
options to purchase 178,522 shares of the
Corporations common stock under the 1998 Plan and 300,000
options to purchase shares of the Corporations common
stock under the 2001 Plan, some of which would continue to vest
if Mr. Nierenberg provided services to the Company solely
in his capacity as a director.
EQUITY
COMPENSATION PLAN INFORMATION
The following table provides information as of December 31,
2007 with respect to shares of our Common Stock that may be
issued under our existing equity compensation plans. The table
does not include information with respect to shares of our
Common Stock subject to outstanding options granted under equity
compensation plans or option agreements assumed by us in
connection with our acquisitions of the companies that
originally granted those options. However, footnote (1) to
the table sets forth the total number of shares of our Common
Stock issuable upon the exercise of those assumed options as of
December 31, 2007, and the weighted average exercise price
of those options. No additional options may be granted under
those assumed plans.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Weighted Average
|
|
|
|
|
|
|
Securities to be
|
|
|
Exercise Price of
|
|
|
Number of Available
|
|
|
|
Issued Upon
|
|
|
Outstanding Options
|
|
|
Securities Remaining for
|
|
Plan Category
|
|
Exercise of Options
|
|
|
($)
|
|
|
Future Issuance
|
|
|
Equity Compensation plans approved by stockholders(2)
|
|
|
18,017,020
|
(3)
|
|
|
3.52
|
|
|
|
13,574,513
|
(4)
|
Equity Compensation plans not approved by stockholders(5)
|
|
|
719,439
|
|
|
|
1.87
|
|
|
|
714,288
|
|
Total
|
|
|
18,736,459
|
|
|
|
3.45
|
|
|
|
14,288,801
|
|
7
|
|
|
(1) |
|
As of December 31, 2007 a total of 12,687 shares of
Common Stock were issuable upon exercise of outstanding options
assumed in connection with acquisitions. The weighted average
exercise price of the outstanding options is $2.94 per share. No
additional options may be granted under any of those assumed
plans. |
|
(2) |
|
Consists of three plans: the 1998 Plan, the Directors Plan
and the Amended and Restated 1998 Employee Stock Purchase Plan
(the Purchase Plan). |
|
(3) |
|
Excludes purchase rights accruing under the Purchase Plan. Under
the Purchase Plan, each eligible employee may purchase shares of
Actuates Common Stock, subject to a maximum number of
shares per offering period (currently 500 or 1000 shares
based on the start date of the offering period), at each
semi-annual purchase date within that offering period (the last
business day of January and July each year) at a purchase price
per share equal to eighty-five percent (85%) of the lower of
(i) the closing selling price per share of Common Stock on
the date immediately preceding the start date of the offering
period in which that semi-annual purchase date occurs and
(ii) the closing selling price per share of Common Stock on
the semi-annual purchase date. |
|
(4) |
|
This number includes shares available for future issuance under
the 1998 Plan, the Directors Plan and the Purchase Plan.
As of December 31, 2007 an aggregate of
11,815,287 shares of common stock under the 1998 Plan,
230,000 shares of common stock under the Directors
Plan and 1,529,226 shares of common stock under the
Purchase Plan were available for issuance. The number of shares
of common stock available for issuance under the Purchase Plan
automatically increases on January 1st of each calendar
year by an amount equal to the lesser of (i) 2% of
Actuates outstanding shares of common stock as of
December 31st of the immediately preceding calendar year or
(ii) 600,000 shares. The number of shares of common
stock available for issuance under the 1998 Plan automatically
increases on January 1st of each calendar year by an amount
equal to the lesser of (i) 5% of Actuates outstanding
shares of common stock as of December 31st of the
immediately preceding calendar year or
(ii) 2,800,000 shares. Shares may be issued under the
1998 Plan in the form of stock options, stock appreciation
rights, restricted stock, restricted stock units or performance
shares, although all awards to date under such plan have been in
the form of option grants. |
|
(5) |
|
Consists of our 2001 Supplemental Stock Plan. See Note 9 of
the Notes to Consolidated Financial Statements in our 2007
Annual Report on
Form 10-K
filed with the Securities and Exchange Commission on
March 14, 2008 for a description of such plan. |
8
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of February 29, 2008,
certain information with respect to shares beneficially owned by
(i) each person who is known by Actuate to be the
beneficial owner of more than five percent of Actuates
outstanding shares of Common Stock, (ii) each of
Actuates directors, (iii) each of Actuates
executive officers and (iv) all directors and executive
officers as a group. Except for shares of Actuate common stock
held in brokerage accounts which may from time to time, together
with other securities held in those accounts, serve as
collateral for margin loans made from such accounts, none of the
shares reported as beneficially owned are pledged as security
for any outstanding loan or indebtedness.
|
|
|
|
|
|
|
|
|
|
|
Shares Beneficially Owned(1)
|
|
|
|
Number of
|
|
|
Percentage of
|
|
Name and Address of Beneficial Owner
|
|
Shares
|
|
|
Total
|
|
|
Columbia Wanger Asset Management, L.P.(2)
227 West Monroe Street, Suite 3000
Chicago, IL 60606
|
|
|
5,000,000
|
|
|
|
8.3
|
|
Ashford Capital Management, Inc.(4)
P.O. Box 4172
Wilmington, DE 19807
|
|
|
3,540,230
|
|
|
|
5.9
|
|
Barclays Global Investors(3)
45 Fremont Street
San Francisco, CA 94105
|
|
|
3,529,730
|
|
|
|
5.9
|
|
Peter I. Cittadini(5)
|
|
|
5,239,207
|
|
|
|
8.7
|
|
Nicolas C. Nierenberg(6)
|
|
|
1,129,541
|
|
|
|
1.9
|
|
Daniel A. Gaudreau(7)
|
|
|
1,539,546
|
|
|
|
2.6
|
|
Ilene M. Vogt(8)
|
|
|
1,194,082
|
|
|
|
2.0
|
|
N. Nobby Akiha(9)
|
|
|
605,024
|
|
|
|
1.0
|
|
Mark A. Coggins(10)
|
|
|
304,688
|
|
|
|
*
|
|
George B. Beitzel(11)
|
|
|
275,000
|
|
|
|
*
|
|
Kenneth E. Marshall(12)
|
|
|
312,500
|
|
|
|
*
|
|
Arthur A. Patterson(13)
|
|
|
1,915,870
|
|
|
|
3.2
|
|
Steven D. Whiteman(14)
|
|
|
245,000
|
|
|
|
*
|
|
All current directors and executive officers as a group
(10 persons)(15)
|
|
|
12,760,458
|
|
|
|
21.2
|
|
|
|
|
* |
|
Less than 1% |
|
(1) |
|
This table is based upon information supplied by executive
officers, directors and principal stockholders and Schedules 13D
and 13G filed with the Securities and Exchange Commission.
Beneficial ownership has been determined in accordance with the
rules of the Securities and Exchange Commission and includes
voting or investment power with respect to securities. Except as
indicated in the footnotes to this table and pursuant to
applicable community property laws, the persons named in the
table have sole voting and investment power with respect to all
shares of Common Stock. Applicable percentages are based on
60,057,467 shares outstanding on February 29, 2008,
adjusted as required by rules promulgated by the Commission.
Unless otherwise indicated, the business address of each
beneficial owner listed is 2207 Bridgepointe Parkway,
Suite 500, San Mateo, CA 94404. |
|
(2) |
|
Based on Schedule 13G/A filed with the Securities and
Exchange Commission for the year ended December 31, 2007. |
|
(3) |
|
Based on Schedule 13G/A filed with the Securities and
Exchange Commission for the year ended December 31, 2007.
Together, Barclays Global Investors, NA. owns
2,645,443 shares of Common Stock and Barclays Global
Fund Advisors owns 884,287 shares of Common Stock. |
|
(4) |
|
Based on Schedule 13G/A filed with the Securities and
Exchange Commission for the year ended December 31, 2007. |
9
|
|
|
(5) |
|
Includes options exercisable for 3,942,740 shares of Common
Stock within 60 days after February 29, 2008. |
|
(6) |
|
Includes options exercisable for 482,689 shares of Common
Stock within 60 days after February 29, 2008. |
|
(7) |
|
Includes options exercisable for 1,405,997 shares of Common
Stock within 60 days after February 29, 2008. |
|
(8) |
|
Includes options exercisable for 1,005,773 shares of Common
Stock within 60 days after February 29, 2008. |
|
(9) |
|
Includes options exercisable for 590,625 shares of Common
Stock within 60 days after February 29, 2008. |
|
(10) |
|
Includes options exercisable for 304,688 shares of Common
Stock within 60 days after February 29, 2008. |
|
(11) |
|
Includes options exercisable for 265,000 shares of Common
Stock within 60 days after February 29, 2008. |
|
(12) |
|
Represents options exercisable for 312,500 shares of Common
Stock within 60 days after February 29, 2008. |
|
(13) |
|
Includes 40,000 shares held by Patterson Family Foundation,
345,960 shares held by Ellmore C. Patterson Partners, and
549,940 shares held by ACP Family Partnership.
Mr. Patterson, a director of Actuate, is the general
partner of Ellmore C. Patterson Partners, the general partner of
ACP Family Partnership and the trustee of Patterson Family
Foundation. Mr. Patterson disclaims beneficial ownership of
such shares except to the extent of his pecuniary interest
therein. Also includes options exercisable into
245,000 shares of Common Stock within 60 days of
February 28, 2007. |
|
(14) |
|
Represents options exercisable into 245,000 shares of
Common Stock within 60 days after February 29, 2008. |
|
(15) |
|
Includes options exercisable for 8,800,012 shares of Common
Stock within 60 days after February 29, 2008. |
EXECUTIVE
COMPENSATION AND RELATED INFORMATION
Compensation
Discussion and Analysis
Introduction It is our intent in this
Compensation Discussion and Analysis to inform our stockholders
of the policies and objectives underlying the compensation
programs for our executive officers. Accordingly, we will
address and analyze each element of the compensation provided to
our chief executive officer (CEO) our chief
financial officer (CFO) and the other executive
officers named in the Summary Compensation Table which follows
this discussion. We will also discuss how each element of
compensation relates to the other elements of compensation. We
are engaged in a very competitive industry and our success
depends upon our ability to attract and retain qualified
executives through competitive compensation packages. The
Compensation Committee administers the compensation programs for
our executive officers with this competitive environment in
mind. However, we believe that the compensation paid to our
executive officers should also be substantially dependent on our
financial performance and the value created for our
stockholders. In furtherance of that objective, the Compensation
Committee utilizes our compensation programs to provide
meaningful incentives for the attainment of our short-term and
long-term strategic objectives and thereby reward those
executive officers who make a substantial contribution to the
attainment of those objectives.
Compensation Policy for Executive Officers We
have designed the various elements comprising our executive
officer compensation packages to achieve the following
objectives:
|
|
|
|
|
tie a substantial portion of such compensation to personal
performance, the financial performance of Actuate and the
executives contributions to Actuates performance;
|
|
|
|
attract, retain, motivate and engage highly skilled and
experienced individuals who excel in their field; and
|
|
|
|
help align the interests of Actuates executive officers
and stockholders.
|
Each executive officers total direct compensation package
is comprised of three elements: (i) base salary and
perquisites; (ii) a non-equity incentive plan award at a
stated percentage of the executive officers base salary;
and (iii) long-term equity incentive awards in the form of
stock option grants. In determining the appropriate level for
each element of such compensation, the Compensation Committee
has generally followed the practice of setting the level of
total direct compensation for our executive officers at between
the 50th and 75th percentiles based on relevant market
data. The Compensation Committee reviews and evaluates the level
of Actuates performance, each executive officers
level of individual performance, tenure, past employment
experience, potential to contribute to Actuates future
growth and compensation history. Based on these factors, an
executive officers actual
10
compensation may be set closer to the 50th percentile or to
the 75th percentile (or in limited cases, such as for our
CFO, above the 75th percentile). Consistent with our
philosophy of emphasizing pay for performance, a cash
performance bonus constitutes a significant percentage of an
executives overall compensation such that the cash
component is designed to pay above target when Actuate exceeds
its goals and below target when Actuate does not achieve its
goals.
Comparative Framework The Compensation
Committee has retained Compensia, an independent compensation
consultant, to identify Actuates peer group, to help it
determine compensation levels between the 50th percentile
to 90th percentile at the peer group companies and to
otherwise provide advice about executive compensation best
practices.
Compensia and the Compensation Committee together determine
Actuates peer group and an appropriate mix of forms of
compensation intended to place Actuates CEO and CFO
between the 50th percentile and 75th percentile of that peer
group. The Compensation Committee and Compensia gathered data
for its comparisons from the Radford October 2006 High-Tech
Executive Survey (Revenue $50,000,000-$200,000,000) and
Compensias proprietary high-tech industry executive
compensation survey (Revenue less than $250,000,000). For
purposes of determining 2006 compensation, our peer group
consisted of 22 software companies with revenues of $250,000,000
or less. In December 2006, 17 software companies with revenues
of approximately $250,000,000 or less were selected as part of
Actuates peer group for purposes of determining 2007
compensation. In addition, based on the Companys current
product line and advice from Compensia, the Compensation
Committee determined that it was advisable to include 7
business intelligence companies with revenues of
approximately $250,000,000 or less in the peer group. The
23 companies which comprised the peer group for 2007 were:
|
|
|
|
|
Software Peers
|
|
Business Intelligence Peers
|
|
Advent Software
|
|
Macrovision
|
|
Concurrent Computer Corporation
|
Agile Software
|
|
Napster
|
|
Echelon Corporation
|
Blackbaud
|
|
Opentv
|
|
Essex Corporation
|
Bottomline Technologies
|
|
Secure Computing
|
|
MapInfo Corporation
|
Embarcadero Technologies
|
|
Sonic Solutions
|
|
Pegasystems
|
Informatica
|
|
Vignette
|
|
Rentrak Corporation
|
InterVideo
|
|
Webmethods
|
|
SPSS
|
Interwoven
|
|
Websense
|
|
|
In October, 2007 the peer group selected by Compensia and the
Compensation Committee was again updated (the Updated Peer
Group). Six companies were deleted from the peer group due
to acquisitions (Agile Software, Embarcadero Technologies,
InterVideo, MapInfo, Essex and webMethods), two companies were
deleted from the peer group due to an increase in their annual
revenue (Informatica and Macrovision) and S1 was added to the
peer group because it met the industry and revenue size criteria.
For other executive officers, Actuates Human Resources
department surveyed compensation practices of United States high
tech companies in the $50,000,000 to $199,000,000 revenue range
using Radfords Executive Survey results. For 2007,
Actuates Human Resources department reviewed each
executive officers base salary and annual non-equity
incentive award to determine where their cash compensation fell
in a range from the
50th
percentile to just over the
75th
percentile of the levels in effect for comparable positions at
Actuates Radford peer group. Based on this information,
Actuates CEO recommended an appropriate increase to the
base salary of each executive officer other than the CEO and CFO
depending on the executive officers performance, tenure,
and past employment experience. The Compensation Committee in
consultation with Compensia then reviewed the CEOs
recommendations and either revised or approved them based on
what the Compensation Committee believed was the appropriate
level of total direct compensation and the appropriate mix of
base salary and perquisites, a non-equity incentive plan award
and a long-term stock-based incentive award.
11
The net result for the 2007 fiscal year was to bring the total
direct cash compensation of the executive officers to
approximately the following percentiles of total direct cash
compensation of the relevant survey data:
|
|
|
|
|
Executive Officer
|
|
Percentile
|
|
|
Peter I. Cittadini
|
|
|
75th
|
|
Daniel A. Gaudreau
|
|
|
>75th
|
|
Ilene M. Vogt
|
|
|
75th
|
|
Mark A. Coggins
|
|
|
50th
|
|
N. Nobby Akiha
|
|
|
50th
|
|
Elements of Compensation Each of the three
major elements comprising an executive officers
compensation package (base salary and perquisites, non-equity
incentive plan award and long-term equity incentive plan award)
is designed to achieve one or more of our overall objectives in
fashioning a competitive level of compensation, tying
compensation to the attainment of one or more of our strategic
business objectives and establishing a meaningful and
substantial link between each executive officers
compensation and our long-term financial success. We also strive
to achieve an appropriate mix between cash payments and equity
incentive awards in order to meet our objectives. We do not
rigidly apply any apportionment goal between those two
components, and no such goal controls our compensation
decisions; however, we emphasize variable compensation elements
that provide value to the executive officer in an amount
commensurate with both the companys and the
individuals performance. Our mix of compensation elements
is designed to reward recent results and motivate long-term
performance through a combination of cash and equity incentive
awards. In deciding on the type and amount of compensation for
each executive, we focus on both current pay and the opportunity
for future compensation. We combine the compensation elements
for each executive in a manner we believe optimizes the
executives contribution to the company. Each year, the
Compensation Committee reviews tally sheets to confirm that
total executive compensation is set at appropriate levels. The
review of the tally sheets prepared with respect to 2007 fiscal
year compensation did not result in any adjustments to the
executive officer compensation levels set for that year. From
time to time the Compensation Committee will also attempt to
validate its prior decisions by reviewing Actuates
performance relative to Actuates peers.
The manner in which the Compensation Committee has structured
each element of compensation may be explained as follows.
Base Salary and Perquisites Each
executive officer receives an appropriate level of salary
commensurate with the duties and responsibilities required to
manage a company the size and stage of development as Actuate on
a day to day basis. Each executive officers base salary
was analyzed in 2007 on the basis of (i) the executive
officers salary history; (ii) the Compensation
Committees evaluation of the executive officers
personal performance in the prior year based on the performance
reviews that the CEO presented with respect to executive
officers other than himself, (iii) the companys
actual performance as compared with pre-set goals for the prior
year; and (iv) the Compensation Committees perception
of an amount sufficient to retain the executive officer in a
competitive marketplace for individuals in comparable positions.
The weight given to these factors differed from individual to
individual, as the Compensation Committee deemed appropriate.
Base salaries for executive officers for the 2006 fiscal year
ranged from the
50th percentile
to the
75th
percentile of the market-based salary levels in effect for
comparable positions at Actuates peer group of companies.
Based on this analysis, the Committee decided to implement base
salary increases for all executive officers other than
Ms. Vogt. The 2007 base salary level for the executive
officers other than Ms. Vogt was increased by a low of
approximately 4.35% to a high of approximately 6.6% from base
salaries in effect for the 2006 fiscal year. Applying the same
analytical framework as it did in 2007, the Committee
implemented 2008 fiscal year base salary level increases for all
executive officers ranging from a low of approximately 2.22% to
a high of 11.1% from base salaries in effect for the 2007 fiscal
year.
Each executive officer received the following perquisites in
2007: (a) $1,500 per month car allowance; (b) $10,000
per year toward otherwise un-reimbursed medical expenses;
(c) $10,000 per year for tax and estate planning;
(d) company-paid health care coverage under the
companys group health plan; and (e) $1,500 of premium
payments on a policy providing up to $5,000,000 of umbrella
insurance coverage. We believe these perquisites are consistent
with those provided to executive officers of Actuates peer
group and with compensation best practices generally and are an
important factor in retaining Actuates executive officers.
12
2007 Non-Equity Incentive Plan
Award Actuate seeks to fairly compensate its
executive officers for target-level performance and to provide
an opportunity to be rewarded for outstanding performance. To
this end, a significant portion of the total compensation for
our executive officers is tied to achievement of financial goals
that the Compensation Committee and executive management believe
to be fundamental drivers of Actuates overall performance
and that align executive management with the interests of
Actuates stockholders. As part of this pay for performance
approach, Actuates 2007 non-equity incentive plan requires
executive officers to achieve pre-set, objective, quantitative
goals in areas identified by the Compensation Committee (with
respect to the CEO and CFO) and the Compensation Committee in
consultation with the CEO (with respect to other executive
officers) as key drivers for Actuates success and that
align their efforts with the interests of Actuates
stockholders. Each incentive award is set at a target level tied
to a specified percentage of the executive officers base
salary. The actual amount of the incentive award is dependent
upon the level at which the performance objectives for the
fiscal year are actually attained. No cash performance incentive
award is paid unless Actuate meets a pre-established threshold
amount of the applicable pre-set, objective goal. Actuate
believes that having different metrics for its CEO and CFO
versus its other executive officers benefits Actuate and its
stockholders: Mr. Cittadini and Mr. Gaudreau are
encouraged to control costs, increase productivity and
consistently grow earnings. The other executive officers are
encouraged to increase license and first year maintenance
bookings, which Actuate believes to be a key driver of
stockholder value.
Percentages
of Base Salary
For the 2007 fiscal year, the annual target incentive awards
were set as the following percentages of executive officer base
salary:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percent of Base Salary (Annual
|
|
|
|
Incentive Award)
|
|
Name
|
|
Threshold
|
|
|
Target
|
|
|
Max
Above-Target1
|
|
|
Peter I. Cittadini
|
|
|
41
|
%
|
|
|
70
|
%
|
|
|
209
|
%
|
Daniel A. Gaudreau
|
|
|
41
|
%
|
|
|
70
|
%
|
|
|
210
|
%
|
Ilene M. Vogt
|
|
|
84
|
%
|
|
|
100
|
%
|
|
|
fn2
|
|
Mark A. Coggins
|
|
|
0
|
%
|
|
|
0
|
%
|
|
|
fn3
|
|
N. Nobby Akiha
|
|
|
0
|
%
|
|
|
0
|
%
|
|
|
fn3
|
|
For the 2007 fiscal year, the quarterly target incentive awards
for Mr. Coggins and Mr. Akiha were set as the
following percentages of base salary:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percent of Base Salary (Quarterly Incentive Award)
|
|
Name
|
|
Threshold
|
|
|
Target
|
|
|
Above-Target
|
|
|
Mark A. Coggins and N. Nobby Akiha
|
|
|
7.43
|
%
|
|
|
8.75
|
%
|
|
|
fn4
|
|
1 The
Compensation Committee had discretion to grant a special bonus
to Mr .Cittadini and Mr. Gaudreau if non-GAAP EPS was
greater than $0.35 or if license and first year maintenance
revenue exceeded $55,500,000.
2 Ms. Vogt
received an annual kicker incentive award to the extent the
Company exceeded her annual license and first year maintenance
bookings target of $74,143,000. For each $1,000,000 of bookings
greater than $74,143,000 but less than $76,143,001 Ms. Vogt
earned a bonus of $30,000. For each $1,000,000 of total bookings
greater than $76,143,000 but less than $78,143,001 Ms. Vogt
earned a bonus of $40,000. For every additional $1,000,000 above
$78,143,001 Ms. Vogt earned a bonus of $50,000.
3 Mr. Coggins
and Mr. Akiha received an annual kicker bonus equal to 0.2%
of their base salary for each $100,000 the Company exceeded 100%
of their annual goal for license and first year maintenance
bookings, which for fiscal year 2007 was $76,113,000.
4 This
incentive award continued to increase on a straight line basis
to the extent the Company exceeded its target.
13
Levels of
Attainment/Targets and Goals
The goals set under the annual non-equity incentive plan for
Mr. Cittadini and Mr. Gaudreau for the 2007 fiscal
year were tied to pre-set levels of annual license and first
year maintenance revenue and non-GAAP earnings. The specific
goals at threshold, target and above target levels were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Level of Attainment
|
|
Goal
|
|
Threshold
|
|
|
Target
|
|
|
Max Above-Target
|
|
|
License and first year
|
|
|
|
|
|
|
|
|
|
|
|
|
maintenance revenue
|
|
$
|
41,500,000
|
|
|
$
|
49,500,000
|
|
|
$
|
55,500,000
|
|
non-GAAP earnings
|
|
$
|
0.24
|
|
|
$
|
0.29
|
|
|
$
|
0.35
|
|
The goals set under the annual non-equity incentive plan for
Ms. Vogt for the 2007 fiscal year were tied to pre-set
levels of total bookings as detailed in
fn2.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Level of Attainment
|
|
Goal
|
|
Threshold
|
|
|
Target
|
|
|
Above-Target
|
|
|
License and first year
|
|
|
|
|
|
|
|
|
|
|
|
|
maintenance bookings
|
|
|
|
|
|
|
|
|
|
|
|
|
and professional services bookings
|
|
|
64,215,500
|
|
|
|
76,143,000
|
|
|
|
fn2
|
|
Ms. Vogt was entitled to an accelerator bonus as defined
and detailed in footnote (2). Ms. Vogt was also entitled to
a one time SPIFF bonus for the first quarter of fiscal year
2007. The SPIFF bonus was tied to pre-set levels of first year
license and maintenance bookings in the first quarter of fiscal
2007 as follows: Ms. Vogt earned no SPIFF bonus if license
and first year maintenance in the first quarter of fiscal 2007
was less than $9,800,000. Ms. Vogt earned a $10,000 SPIFF
bonus if license and first year maintenance bookings in the
first quarter of fiscal 2007 were more than $9,800,000 but less
than $10,800,000. Ms. Vogt earned an additional $10,000
SPIFF bonus if license and first year maintenance bookings in
the first quarter of fiscal 2007 were more $10,800,000.
The goals set under the quarterly non-equity incentive plan for
Mr. Coggins and Mr. Akiha for the 2007 fiscal year
were tied to pre-set levels of quarterly license and first year
maintenance bookings as set forth in footnote (5).
|
|
|
|
|
|
|
|
|
Level of Attainment
|
Goal
|
|
Threshold
|
|
Target5
|
|
Above-Target
|
|
License and first year
|
|
|
|
|
|
|
maintenance bookings
|
|
85% of
|
|
100% of
|
|
greater than 100%
|
|
|
quarterly goal
|
|
quarterly goal
|
|
of quarterly goal
|
Actual
2007 Incentive Awards
The actual incentive awards paid to each executive officer for
the 2007 fiscal year reflect the level at which these pre-set,
objective, quantitative goals were attained. For performance
that fell between designated levels, the incentive award amount
for that goal was interpolated on a straight linear basis.
2008
Incentive Awards
In December 2007, the Compensation Committee approved the 2008
non-equity incentive plan targets for all executive officers
other than Mr. Cittadini and Mr. Gaudreau. For the
2008 fiscal year, the target incentive awards were set after
adjustment by the Companys CEO as the following
percentages of executive officer base salary
Ms. Vogt: 100%; Mr. Coggins and Mr. Akiha: 40%.
In March 2008, after consulting with Compensia, the Compensation
Committee approved the 2008 non-equity incentive plan targets
for Mr. Cittadini and Mr. Gaudreau. The goals set for
the 2008 fiscal year under the non-equity incentive plan for
Mr. Cittadini and Mr. Gaudreau were tied to pre-set
levels of license and first year maintenance
5 The
2007 quarterly license and first year maintenance bookings goals
were: Q1:$13,724,000; Q2:$16,885,000; Q3: $18,142,000;
Q4:$27,362,000.
14
revenue, non-GAAP earnings and open source driven revenue. The
Compensation Committee included a new target for 2008 related to
open source driven revenue. This goal is meant to encourage
Mr. Cittadini and Mr. Gaudreau to drive the success of
Actuates BIRT initiative, which the Company believes is
important for its future success. For 2008,
Mr. Cittadinis and Mr. Gaudreaus 2008
incentive awards are set at a target level tied to a specified
percentage of their base salary. The actual amount of the
incentive award is dependent upon the level at which the
performance objectives for the fiscal year are actually
attained. For the 2008 fiscal year, the target incentive awards
were set as the following percentages of executive officer base
salary for Mr. Cittadini and Mr. Gaudreau:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percent of Base Salary
|
|
Name
|
|
Threshold
|
|
|
Target
|
|
|
Max
Above-Target6
|
|
|
Peter I. Cittadini
|
|
|
47
|
%
|
|
|
73
|
%
|
|
|
251
|
%
|
Daniel A. Gaudreau
|
|
|
46
|
%
|
|
|
71
|
%
|
|
|
244
|
%
|
Long-Term Equity Incentive
Awards Actuate has structured its long-term
incentive program for executive officers in the form of stock
option grants, primarily under the 1998 Plan. Actuates
long-term equity compensation is designed to strengthen the
mutuality of interests between Actuates executive officers
and its stockholders by giving executive officers a significant
stake in the future performance of Actuates stock. Option
grants provide a return only if an executive officer remains
employed by Actuate and then only if the market price of
Actuates common stock appreciates over the option term.
Generally, to immediately align an executive officer with the
interests of Actuates stockholders, a significant option
grant is made in the year that an executive officer commences
employment. Thereafter, option grants may be made at varying
times and in varying amounts to reward an executive officer for
past performance, to provide a continuing incentive for future
performance and to further align executive officer and
stockholder interests. The guidelines for equity grants are
structured in consideration of peer group practice with respect
to the economic value (Black-Scholes/binomial value) of the
equity compensation provided, the number of shares granted each
year as a percent of total common shares outstanding, and actual
number of shares granted. These different guidelines are taken
into consideration due to the inherent limitations of any one
methodology. Actuate tends to give the most weight to the number
of shares granted each year as a percent of total common shares
outstanding. Actuate recognizes that a common practice is to
determine equity guidelines solely based on the economic value
of the award at the time of grant. However, the number of shares
that would be required to deliver a market competitive equity
incentive grant based on this methodology would be extremely
high, due to Actuates current stock price, and would
result in a total annual equity grant level that the Company
does not believe is in the best interests of stockholders. The
third guideline, the actual number of shares granted, is given
little weight because it does not account for the total number
of outstanding shares and does not facilitate a comparison of
annual grant levels from year to year as a percentage of the
outstanding shares.
The Compensation Committee determines the actual number of
shares to be subject to each option grant. Generally, the size
of each grant is set at a level that the Compensation Committee
deems appropriate to create a meaningful opportunity for stock
ownership based upon the individuals position with
Actuate, the individuals potential for future
responsibility and promotion, the individuals performance
in the recent period and the number and value of unvested
options held by the individual at the time of the new grant. The
relative weight given to each of these factors will vary from
individual to individual at the Compensation Committees
discretion.
Each option grant allows the executive officer to acquire shares
of Actuates common stock at a fixed price per share (the
closing selling price on the grant date) over a specified period
of time. Options typically vest in installments over a four-year
period, contingent upon the executive officers continued
employment with Actuate. The vesting schedule and the number of
option shares granted are established to ensure a meaningful
incentive in each year following the year of grant until all
shares are vested.
6 The
Compensation Committee may grant a special bonus for
Mr. Cittadini and Mr. Gaudreau if non-GAAP EPS,
license and first year maintenance revenue, or open source
driven revenue exceed certain pre-determined levels. The
Committee has also reserved the right to review and modify plan
numbers after six months of actual results, depending on the
macro-environment for the Companys business.
15
In January 2007, the Board granted stock options to
Mr. Cittadini (300,000 shares), Mr. Gaudreau
(200,000 shares), Ms. Vogt (100,000 shares),
Mr. Coggins (100,000 shares) and Mr. Akiha
(100,000 shares). Additional information regarding these
awards is set forth in the Summary Compensation Table and the
Grants of Plan-Based Awards Table contained in this proxy
statement. In January 2008, the Board granted stock options to
Mr. Cittadini (300,000 shares), Mr. Gaudreau
(200,000 shares), Ms. Vogt (100,000 shares),
Mr. Coggins (100,000 shares) and Mr. Akiha
(75,000 shares).7
Severance Agreements In October 2005, Actuate
entered into a change of control severance benefit agreement
(the Severance Agreements) with each of the
following executive officers named in the Summary Compensation
Table: Messrs. Cittadini, Gaudreau, Coggins, Akiha and
Ms. Vogt. These agreements were scheduled to expire on
December 31, 2007. The Compensation Committee engaged
Compensia to conduct a survey to analyze the competitiveness of
the Severance Agreements by comparison to the Updated Peer
Group. As a result of this survey, the Compensation Committee
determined that the Severance Agreements were competitive and
entered into new severance agreements that are substantially the
same as the prior agreements. However, based on the market data
collected by Compensia, the Compensation Committee determined
that market practice is to enter into change in control
severance agreements with an unlimited duration, and
accordingly, the new agreements do not contain an expiration
date. Also based on market data, the Compensation Committee
chose not to add significant additional features to the
agreements, such as a tax
gross-up. A
summary of the material terms of the new severance agreements,
together with a quantification of the benefits available under
the agreements, may be found in the section of the proxy
statement entitled Executive Compensation and Related
Information Termination of Employment and Change in
Control Arrangements. The severance agreements are
intended to keep executive management neutral and aligned with
the stockholders best interests when considering an
acquisition of Actuate and also to provide a stable transition
period following such an acquisition by imposing a double
trigger on the benefits provided under such agreements. The
severance benefits will only be payable if the executives
employment terminates under certain specified circumstances in
connection with a change in control of the company and will not
be payable to an executive who leaves Actuates employ
without good reason. Accordingly, the severance agreements
provide protection against an involuntary termination or
constructive termination following a change in control and will
allow the executives to focus their attention on acquisition
proposals that are in the best interests of the stockholders,
without undue concern as to their own financial situation. For
such reasons, we believe the terms of the severance agreements
properly motivate the executive management team to evaluate
potential change in control transactions in accord with
Actuates stockholders best interests. We also
believe based on advice from Compensia, that the terms of the
severance agreements are within the range of best practices for
Actuates size and stage of development.
Stock Option Policies There is no established
practice of timing of performance award equity grants in advance
of the release of favorable financial results or adjusting the
award date in connection with the release of unfavorable
financial developments affecting our business. Performance
awards for existing executive officers and employees are
typically made in connection with the annual review process
which occurs in January each year. Options relating to these
performance awards are then granted in the January meeting of
the Compensation Committee. The date for the January meeting of
the Compensation Committee is normally set approximately one
year prior to that meeting. However, the date for the January
2008 meeting of the Compensation Committee was adjusted in Fall
2007 in order to accommodate a scheduling conflict. Equity
awards for newly hired executives are typically made at the next
scheduled Compensation Committee meeting following the hire
date. It is our intent that all stock option grants have an
exercise price per share equal to the closing selling price per
share on the grant date.
In July 2006, the Board of Directors established a policy
pursuant to which option grants to Section 16 officers and
directors (other than automatic grants to directors at the
annual stockholder meeting) are to be made only at duly
7 Each
reported option will vest in accordance with the following
schedule: twenty-five percent of the option shares will vest on
the one year anniversary of the option grant date and the
remaining option shares will vest in thirty-six equal monthly
installments over the thirty-six month period measured from the
first anniversary of the option grant date, provided the
optionee continues to provide services to the Corporation
through each applicable vesting date.
16
convened meetings of the Compensation Committee. Prior to July
2006, the Corporation also granted options to Section 16
officers and directors via unanimous written consent resolutions.
Actuate does not have a policy to require executive officers to
hold options or other equity for any period of time.
Tax Limitation Under federal tax laws, a
publicly-held company such as Actuate is not allowed a federal
income tax deduction for compensation paid to certain executive
officers to the extent that compensation exceeds
$1.0 million per covered officer in any year. The
limitation applies only to compensation that is not performance
based. Non-performance based compensation paid to Actuates
covered executive officers for 2007 did not exceed the
$1.0 million limit per officer and the Compensation
Committee does not anticipate that the non-performance based
compensation to be paid to the Corporations executive
officers for the 2008 year will be in excess of the
deductible limit. To qualify for an exemption from the
$1.0 million deduction limitation, the stockholders
approved a limitation under Actuates 1998 Plan on the
maximum number of shares of Common Stock for which any one
participant may be granted stock options per calendar year. As a
result of that limitation, the compensation deemed paid to an
executive officer in connection with the exercise of outstanding
options under the 1998 Plan with an exercise price equal to the
fair market value of the option shares on the grant date should
in most instances qualify as performance-based compensation that
will not be subject to the $1.0 million limitation.
However, the Compensation Committee believes that in
establishing the cash and equity incentive compensation programs
for the companys executive officers, the potential
deductibility of the compensation payable under those programs
should be only one of a number of relevant factors taken into
consideration, and not the sole governing factor. For that
reason the Compensation Committee may deem it appropriate to
provide one or more executive officers with the opportunity to
earn incentive compensation, whether through cash incentive
award programs tied to the companys financial performance
or equity incentive grants tied to the executive officers
continued service, which may be in excess of the amount
deductible by reason of Section 162(m) or other provisions
of the Internal Revenue Code. The Compensation Committee
believes it is important to maintain cash and equity incentive
compensation at the requisite level to attract and retain the
executive officers essential to the companys financial
success, even if all or part of that compensation may not be
deductible by reason of the Section 162(m) limitation.
Conclusion
Actuate believes the total compensation packages for its
executive officers are reasonable and appropriate considering
Actuates size and stage of development, the competitive
environment in which it operates, achievement of its annual
goals and its overall performance.
17
Summary
Compensation Table
The following table provides certain summary information
concerning the compensation earned for services rendered in all
capacities to the Corporation and its subsidiaries for the years
ended December 31, 2006 and December 31, 2007 by the
Corporations CEO, CFO and each of the Corporations
three other most highly compensated executive officers whose
total compensation for the 2007 fiscal year was in excess of
$100,000 and who were serving as executive officers at the end
of that year. No other executive officers who would have
otherwise been includable in such table on the basis of total
compensation for the 2007 fiscal year have been excluded by
reason of their termination of employment or change in executive
status during that year. The Corporation does not sponsor a
pension plan or a non-qualified deferred compensation plan and
has not granted stock or stock-based awards other than stock
options to its executive officers.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option
|
|
|
Incentive Plan
|
|
|
All Other
|
|
|
|
|
|
|
|
|
|
Salary
|
|
|
Awards
|
|
|
Compensation
|
|
|
Compensation
|
|
|
Total
|
|
Name and Principal Position
|
|
Year
|
|
|
($)(1)
|
|
|
($)(2)
|
|
|
($)(3)
|
|
|
($)(4)
|
|
|
($)
|
|
(a)
|
|
(b)
|
|
|
(c)
|
|
|
(d)
|
|
|
(e)
|
|
|
(f)
|
|
|
(g)
|
|
|
Peter I. Cittadini,
|
|
|
2006
|
|
|
|
415,000
|
|
|
|
621,596
|
|
|
|
380,677
|
|
|
|
41,300
|
|
|
|
1,458,573
|
|
Chief Executive Officer and President
|
|
|
2007
|
|
|
|
430,000
|
|
|
|
885,769
|
|
|
|
633,050
|
|
|
|
41,300
|
|
|
|
1,990,119
|
|
Daniel A. Gaudreau,
|
|
|
2006
|
|
|
|
280,000
|
|
|
|
406,971
|
|
|
|
305,182
|
|
|
|
41,300
|
|
|
|
1,033,454
|
|
Senior Vice President Operations and Chief Financial Officer
|
|
|
2007
|
|
|
|
300,000
|
|
|
|
586,935
|
|
|
|
443,135
|
|
|
|
44,675
|
|
|
|
1,374,745
|
|
Ilene M. Vogt,
|
|
|
2006
|
|
|
|
225,000
|
|
|
|
250,693
|
|
|
|
170,000
|
|
|
|
40,820
|
|
|
|
686,513
|
|
SVP Global Field Operations
|
|
|
2007
|
|
|
|
225,000
|
|
|
|
314,334
|
|
|
|
191,250
|
|
|
|
44,195
|
|
|
|
774,779
|
|
Mark A. Coggins,
|
|
|
2006
|
|
|
|
220,000
|
|
|
|
289,454
|
|
|
|
54,309
|
|
|
|
40,820
|
|
|
|
604,583
|
|
SVP Engineering
|
|
|
2007
|
|
|
|
230,000
|
|
|
|
321,709
|
|
|
|
51,600
|
|
|
|
44,195
|
|
|
|
647,504
|
|
N. Nobby Akiha,
|
|
|
2006
|
|
|
|
215,000
|
|
|
|
117,031
|
|
|
|
53,075
|
|
|
|
20,650
|
|
|
|
405,756
|
|
SVP Marketing
|
|
|
2007
|
|
|
|
225,000
|
|
|
|
249,939
|
|
|
|
50,478
|
|
|
|
44,675
|
|
|
|
570,092
|
|
|
|
|
(1) |
|
Includes amounts deferred at the executive officers
election under the Actuate Corporation 401(k) Retirement Savings
Plan, a qualified deferred compensation plan under
section 401(k) of the Internal Revenue Code. |
|
(2) |
|
The amounts in column (d) reflect the compensation cost
recognized for financial statement reporting purposes for the
fiscal years ended December 31, 2006, and December 31,
2007, in accordance with SFAS 123(R), with respect to
outstanding stock options granted to the named executives,
whether granted in the 2006 or 2007 fiscal year or any earlier
fiscal year. The reported amounts are based on the grant date
fair value of each of those options and have not been adjusted
for the potential impact of estimated forfeitures. Assumptions
used in the calculation of the grant date fair value of each
option under SFAS 123(R) are included in Note 9 of the
Notes to Consolidated Financial Statements in our 2007 Annual
Report on Form
10-K filed
with the Securities and Exchange Commission on March 14,
2008. |
|
(3) |
|
The amounts in column (e) reflect the cash awards to the
named executive under the Corporations non-equity
incentive plan which is described in detail under the heading
Non Equity Incentive Plan Award herein. |
|
(4) |
|
The amounts in column (f) reflect the summary cash value of
certain perquisites received by the named executive as described
in the table below, Itemization of All Other Compensation |
18
Itemization
of All Other Compensation
The following table provides an itemization of other
compensation (see column f above) earned for services rendered
in all capacities to the Corporation and its subsidiaries for
the years ended December 31, 2006 and December 31,
2007 by the Corporations CEO, CFO and each of the
Corporations three other most highly compensated executive
officers whose total compensation for the 2007 fiscal year was
in excess of $100,000 and who were serving as executive officers
at the end of that year. No other executive officers who would
have otherwise been includable in such table on the basis of
total compensation for the 2007 fiscal year have been excluded
by reason of their termination of employment or change in
executive status during that year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax and
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Car
|
|
|
Un-reimbursed
|
|
|
Estate
|
|
|
Health Ins.
|
|
|
Umbrella
|
|
|
401k
|
|
|
|
|
|
|
Allowance
|
|
|
Medical Exps.
|
|
|
Planning
|
|
|
Premiums
|
|
|
Ins Cov
|
|
|
Match
|
|
|
Total
|
|
Name and Principal Position
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
Peter I. Cittadini,
|
|
|
18,000
|
|
|
|
10,000
|
|
|
|
10,000
|
|
|
|
1,800
|
|
|
|
1,500
|
|
|
|
|
|
|
|
41,300
|
|
Daniel A. Gaudreau,
|
|
|
18,000
|
|
|
|
10,000
|
|
|
|
10,000
|
|
|
|
1,800
|
|
|
|
1,500
|
|
|
|
3,375
|
|
|
|
44,675
|
|
Ilene M. Vogt,
|
|
|
18,000
|
|
|
|
10,000
|
|
|
|
10,000
|
|
|
|
1,320
|
|
|
|
1,500
|
|
|
|
3,375
|
|
|
|
44,195
|
|
Mark A. Coggins,
|
|
|
18,000
|
|
|
|
10,000
|
|
|
|
10,000
|
|
|
|
1,320
|
|
|
|
1,500
|
|
|
|
3,375
|
|
|
|
44,195
|
|
N. Nobby Akiha,
|
|
|
18,000
|
|
|
|
10,000
|
|
|
|
10,000
|
|
|
|
1,800
|
|
|
|
1,500
|
|
|
|
3,375
|
|
|
|
44,675
|
|
Grants of
Plan-Based Awards
The following table provides summary information concerning each
grant of an award made to an executive officer in 2007 under a
compensation plan.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Exercise or
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities
|
|
|
Base Price of
|
|
|
Grant Date
|
|
|
|
|
|
|
Potential Payouts Under Non-Equity Incentive Plan
Awards(1)
|
|
|
Underlying
|
|
|
Option
|
|
|
FAS123R
|
|
|
|
|
|
|
Threshold
|
|
|
Target
|
|
|
Maximum
|
|
|
Options
|
|
|
Awards
|
|
|
Value
|
|
Name
|
|
Grant Date
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
(#)(4)
|
|
|
($/Sh)
|
|
|
($)
|
|
|
Peter I. Cittadini
|
|
|
01/24/07
|
|
|
|
176,250
|
|
|
|
300,000
|
|
|
|
900,000
|
|
|
|
300,000
|
|
|
|
5.11
|
|
|
|
1,046,204
|
|
Daniel A. Gaudreau
|
|
|
01/24/07
|
|
|
|
123,375
|
|
|
|
210,000
|
|
|
|
630,000
|
|
|
|
200,000
|
|
|
|
5.11
|
|
|
|
697,469
|
|
Ilene M. Vogt
|
|
|
01/24/07
|
|
|
|
191,250
|
|
|
|
225,000
|
|
|
|
(2
|
)
|
|
|
100,000
|
|
|
|
5.11
|
|
|
|
348,735
|
|
Mark A. Coggins
|
|
|
01/24/07
|
|
|
|
68,425
|
|
|
|
80,500
|
|
|
|
(3
|
)
|
|
|
100,000
|
|
|
|
5.11
|
|
|
|
348,735
|
|
N. Nobby Akiha
|
|
|
01/24/07
|
|
|
|
66,938
|
|
|
|
78,750
|
|
|
|
(3
|
)
|
|
|
100,000
|
|
|
|
5.11
|
|
|
|
348,735
|
|
|
|
|
(1) |
|
Reflects the potential payouts under the Corporations
non-equity incentive plan based on the Corporations
performance for the 2007 fiscal year. The actual amounts earned
under such plan for the 2007 fiscal year are disclosed in the
Summary Compensation Table in the column Non-Equity
Incentive Plan Compensation. For further information
concerning the performance goals applicable to these awards and
the methodology for determining the actual amount of such
awards, see the Compensation Discussion and Analysis
section above. |
|
(2) |
|
Ms. Vogt received an annual kicker incentive award to the
extent the Company exceeded her annual license and first year
maintenance bookings target of $74,143,000. For each $1,000,000
of bookings greater than $74,143,000 but less than $76,143,001
Ms. Vogt earned a bonus of $30,000. For each $1,000,000 of
total bookings greater than $76,143,000 but less than
$78,143,001 Ms. Vogt earned a bonus of $40,000. For every
additional $1,000,000 above $78,143,001 Ms. Vogt earned a
bonus of $50,000. |
|
(3) |
|
Messrs. Coggins and Akihas non-equity incentive
plan awards were structured so as to provide an additional
payment of 0.2% of their salary for every $100,000 that
Actuates license and first year maintenance bookings
exceed one hundred percent of Actuates annual goal. |
|
(4) |
|
Each reported option will vest in accordance with the following
schedule: twenty-five percent of the option shares will vest on
the one year anniversary of the option grant date and the
remaining option shares will vest in thirty-six equal monthly
installments over the thirty-six month period measured from the
first anniversary of the option grant date, provided the
optionee continues to provide services to the Corporation
through each applicable vesting date. |
19
Outstanding
Equity Awards at Fiscal Year-End
The following table sets forth the outstanding equity awards for
each of Actuates executive officers as of
December 31, 2007. As of December 31, 2007, none of
the executive officers held unvested stock or stock-based awards
other than the unexercisable stock options reported below.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Awards(1)
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incentive Plan
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Awards:
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Number of
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Securities
|
|
|
Securities
|
|
|
|
|
|
|
|
|
|
Securities
|
|
|
Underlying
|
|
|
Underlying
|
|
|
|
|
|
|
|
|
|
Underlying
|
|
|
Unexercised
|
|
|
Unexercised
|
|
|
|
|
|
|
|
|
|
Options
|
|
|
Options
|
|
|
Unearned
|
|
|
Option
|
|
|
Option
|
|
|
|
(#)
|
|
|
(#)
|
|
|
Options
|
|
|
Exercise Price
|
|
|
Expiration
|
|
Name
|
|
Exercisable
|
|
|
Unexercisable
|
|
|
(#)
|
|
|
($)
|
|
|
Date
|
|
|
Peter I. Cittadini
|
|
|
101,168
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.53
|
|
|
|
12/11/08(3
|
)
|
|
|
|
458,832
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.53
|
|
|
|
12/11/08(3
|
)
|
|
|
|
500,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.75
|
|
|
|
10/29/11(2
|
)
|
|
|
|
600,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
79,118
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(5
|
)
|
|
|
|
300,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
1,000,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(4
|
)
|
|
|
|
39,559
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(6
|
)
|
|
|
|
366,667
|
|
|
|
33,333
|
|
|
|
0
|
|
|
$
|
2.99
|
|
|
|
04/02/14(2
|
)
|
|
|
|
218,750
|
|
|
|
81,250
|
|
|
|
0
|
|
|
$
|
2.48
|
|
|
|
01/28/15(2
|
)
|
|
|
|
107,813
|
|
|
|
117,187
|
|
|
|
0
|
|
|
$
|
3.59
|
|
|
|
01/24/16(2
|
)
|
|
|
|
|
|
|
|
300,000
|
|
|
|
|
|
|
$
|
5.11
|
|
|
|
01/24/17(2
|
)
|
Daniel A. Gaudreau
|
|
|
11,334
|
|
|
|
|
|
|
|
0
|
|
|
$
|
2.06
|
|
|
|
05/27/08(3
|
)
|
|
|
|
47,675
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.53
|
|
|
|
12/11/08(3
|
)
|
|
|
|
5,992
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.53
|
|
|
|
12/11/08(3
|
)
|
|
|
|
300,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.75
|
|
|
|
10/29/11(2
|
)
|
|
|
|
160,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
40,156
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(5
|
)
|
|
|
|
200,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
61,387
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(5
|
)
|
|
|
|
20,078
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(6
|
)
|
|
|
|
229,167
|
|
|
|
20,833
|
|
|
|
0
|
|
|
$
|
2.99
|
|
|
|
04/02/14(2
|
)
|
|
|
|
145,833
|
|
|
|
54,167
|
|
|
|
0
|
|
|
$
|
2.48
|
|
|
|
01/28/15(2
|
)
|
|
|
|
71,875
|
|
|
|
78,125
|
|
|
|
0
|
|
|
$
|
3.59
|
|
|
|
01/24/16(2
|
)
|
|
|
|
|
|
|
|
200,000
|
|
|
|
|
|
|
$
|
5.11
|
|
|
|
01/24/17(2
|
)
|
Ilene M. Vogt
|
|
|
64,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.53
|
|
|
|
12/11/08(3
|
)
|
|
|
|
300,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.75
|
|
|
|
10/29/11(2
|
)
|
|
|
|
150,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
72,585
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
6,688
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
275,000
|
|
|
|
25,000
|
|
|
|
0
|
|
|
$
|
2.99
|
|
|
|
04/02/14(2
|
)
|
|
|
|
72,917
|
|
|
|
27,083
|
|
|
|
0
|
|
|
$
|
2.48
|
|
|
|
01/28/15(2
|
)
|
|
|
|
23,958
|
|
|
|
26,042
|
|
|
|
0
|
|
|
$
|
3.59
|
|
|
|
01/24/16(2
|
)
|
|
|
|
|
|
|
|
100,000
|
|
|
|
|
|
|
$
|
5.11
|
|
|
|
01/24/17(2
|
)
|
Mark A. Coggins
|
|
|
218,750
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.56
|
|
|
|
10/08/13(2
|
)
|
|
|
|
4,167
|
|
|
|
27,083
|
|
|
|
0
|
|
|
$
|
2.48
|
|
|
|
01/28/15(2
|
)
|
|
|
|
35,938
|
|
|
|
39,062
|
|
|
|
0
|
|
|
$
|
3.59
|
|
|
|
01/24/16(2
|
)
|
|
|
|
|
|
|
|
100,000
|
|
|
|
|
|
|
$
|
5.11
|
|
|
|
01/24/17(2
|
)
|
N. Nobby Akiha
|
|
|
100,000
|
|
|
|
|
|
|
|
0
|
|
|
$
|
3.75
|
|
|
|
10/29/11(2
|
)
|
|
|
|
37,976
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
312,024
|
|
|
|
|
|
|
|
0
|
|
|
$
|
1.49
|
|
|
|
03/03/13(2
|
)
|
|
|
|
72,917
|
|
|
|
27,083
|
|
|
|
0
|
|
|
$
|
2.48
|
|
|
|
01/28/15(2
|
)
|
|
|
|
23,958
|
|
|
|
26,042
|
|
|
|
0
|
|
|
$
|
3.59
|
|
|
|
01/24/16(2
|
)
|
|
|
|
|
|
|
|
100,000
|
|
|
|
|
|
|
$
|
5.11
|
|
|
|
01/24/17(2
|
)
|
20
|
|
|
(1) |
|
Each option will vest in full on an accelerated basis upon
certain changes in control or upon the optionees
termination of employment under certain circumstances in
connection with such change in control, as described in more
detail under the heading Termination of Employment and
Change in Control Agreements herein. |
|
(2) |
|
Each of these reported options vests in accordance with the
following schedule: twenty-five percent of the option shares
vest on the one year anniversary of the option grant date and
the remaining option shares vest in thirty-six equal monthly
installments over the thirty-six month period measured from the
first anniversary of the option grant date, provided the
optionee continues to provide services to the Corporation
through each applicable vesting date. The options held by the
executive officers that vest in accordance with this schedule
are as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
|
|
Option
|
|
Total Number of
|
|
Exercised Before
|
Name
|
|
Grant Date
|
|
Shares Granted
|
|
January 1, 2008
|
|
Peter I. Cittadini
|
|
|
10/29/01
|
|
|
|
500,000
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
600,000
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
300,000
|
|
|
|
0
|
|
|
|
|
04/02/04
|
|
|
|
400,000
|
|
|
|
0
|
|
|
|
|
01/28/05
|
|
|
|
300,000
|
|
|
|
0
|
|
|
|
|
01/24/06
|
|
|
|
225,000
|
|
|
|
0
|
|
|
|
|
01/24/07
|
|
|
|
300,000
|
|
|
|
0
|
|
Daniel A. Gaudreau
|
|
|
10/29/01
|
|
|
|
300,000
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
160,000
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
200,000
|
|
|
|
0
|
|
|
|
|
04/02/04
|
|
|
|
250,000
|
|
|
|
0
|
|
|
|
|
01/28/05
|
|
|
|
200,000
|
|
|
|
0
|
|
|
|
|
01/24/06
|
|
|
|
150,000
|
|
|
|
0
|
|
|
|
|
01/24/07
|
|
|
|
200,000
|
|
|
|
0
|
|
Ilene M. Vogt
|
|
|
10/29/01
|
|
|
|
300,000
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
200,000
|
|
|
|
50,000
|
|
|
|
|
03/03/03
|
|
|
|
72,585
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
6,688
|
|
|
|
0
|
|
|
|
|
04/02/04
|
|
|
|
300,000
|
|
|
|
0
|
|
|
|
|
01/28/05
|
|
|
|
100,000
|
|
|
|
0
|
|
|
|
|
01/24/06
|
|
|
|
50,000
|
|
|
|
0
|
|
|
|
|
01/24/07
|
|
|
|
100,000
|
|
|
|
0
|
|
Mark A. Coggins
|
|
|
10/08/03
|
|
|
|
400,000
|
|
|
|
181,250
|
|
|
|
|
01/28/05
|
|
|
|
100,000
|
|
|
|
68,750
|
|
|
|
|
01/24/06
|
|
|
|
75,000
|
|
|
|
0
|
|
|
|
|
01/24/07
|
|
|
|
100,000
|
|
|
|
0
|
|
N. Nobby Akiha
|
|
|
10/29/01
|
|
|
|
100,000
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
37,976
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
312,024
|
|
|
|
0
|
|
|
|
|
01/28/05
|
|
|
|
100,000
|
|
|
|
0
|
|
|
|
|
01/24/06
|
|
|
|
50,000
|
|
|
|
0
|
|
|
|
|
01/24/07
|
|
|
|
100,000
|
|
|
|
0
|
|
|
|
|
(3) |
|
Each of these reported options vested in accordance with the
following schedule: twenty percent of the option shares vested
on the one year anniversary of the option grant date and the
remaining option shares vested in forty-eight equal monthly
installments over the forty-eight month period measured from the
first anniversary of the option grant date, provided the
optionee continued to provide services to the Corporation
through each applicable vesting date. The options held by the
executive officers that vested in accordance with this schedule
are as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
|
|
Option
|
|
Total Number of
|
|
Exercised Before
|
Name
|
|
Grant Date
|
|
Shares Granted
|
|
January 1, 2007
|
|
Peter I. Cittadini
|
|
|
12/11/98
|
|
|
|
101,168
|
|
|
|
0
|
|
|
|
|
12/11/98
|
|
|
|
458,832
|
|
|
|
0
|
|
Daniel A. Gaudreau
|
|
|
05/27/98
|
|
|
|
40,000
|
|
|
|
28,666
|
|
|
|
|
12/11/98
|
|
|
|
110,596
|
|
|
|
62,921
|
|
|
|
|
12/11/98
|
|
|
|
29,404
|
|
|
|
23,412
|
|
Ilene M. Vogt
|
|
|
12/11/98
|
|
|
|
120,000
|
|
|
|
56,000
|
|
21
|
|
|
(4) |
|
The reported option vested in accordance with the following
schedule: thirty-three percent of the option shares vested on
the one year anniversary of the option grant date and the
remaining option shares vested in twenty-four equal monthly
installments over the twenty-four month period measured from the
first anniversary of the option grant date, provided the
optionee continued to provide services to the Corporation
through each applicable vesting date. The option that vested in
accordance with this schedule is as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
|
|
|
Option
|
|
|
Total Number of
|
|
|
Exercised Before
|
|
Name
|
|
Grant Date
|
|
|
Shares Granted
|
|
|
January 1, 2007
|
|
|
Peter I. Cittadini
|
|
|
03/03/03
|
|
|
|
1,000,000
|
|
|
|
0
|
|
|
|
|
(5) |
|
Each of these reported options vested in accordance with the
following schedule: one hundred percent of the option shares
vested on the one year anniversary of the option grant date,
provided the optionee continued to provide services to the
Corporation through such date. The options held by the executive
officers that vested in accordance with this schedule are as
follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
|
|
|
Option
|
|
|
Total Number of
|
|
|
Exercised Before
|
|
Name
|
|
Grant Date
|
|
|
Shares Granted
|
|
|
January 1, 2007
|
|
|
Peter I. Cittadini
|
|
|
03/03/03
|
|
|
|
79,118
|
|
|
|
0
|
|
Daniel A. Gaudreau
|
|
|
03/03/03
|
|
|
|
40,156
|
|
|
|
0
|
|
|
|
|
03/03/03
|
|
|
|
61,387
|
|
|
|
0
|
|
|
|
|
(6) |
|
Each of these reported options vested in accordance with the
following schedule: one hundred percent of the option shares
vested on the six-month anniversary of the option grant date,
provided the optionee continued to provide services to the
Corporation through such date. The options held by the executive
officers that vested in accordance with this schedule are as
follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
|
|
|
Option
|
|
|
Total Number of
|
|
|
Exercised Before
|
|
Name
|
|
Grant Date
|
|
|
Shares Granted
|
|
|
January 1, 2007
|
|
|
Peter I. Cittadini
|
|
|
03/03/03
|
|
|
|
39,559
|
|
|
|
0
|
|
Daniel A. Gaudreau
|
|
|
03/03/03
|
|
|
|
20,078
|
|
|
|
0
|
|
Option
Exercises and Stock Vested
The following directors and executive officers exercised stock
options in 2007:
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
|
|
Value Realized
|
|
|
|
Acquired on
|
|
|
on Exercise
|
|
Name
|
|
Exercise (#)
|
|
|
($)
|
|
|
Kenneth E. Marshall
|
|
|
22,500
|
|
|
|
114,450
|
|
Nicolas C. Nierenberg
|
|
|
840,000
|
|
|
|
3,536,156
|
|
Steven D. Whiteman
|
|
|
81,788
|
|
|
|
419,858
|
|
George B. Beitzel
|
|
|
100,000
|
|
|
|
559,500
|
|
Ilene Vogt
|
|
|
50,000
|
|
|
|
356,500
|
|
Mark A. Coggins
|
|
|
250,000
|
|
|
|
1,211,750
|
|
|
|
|
(1) |
|
Value realized is determined by multiplying (i) the amount
by which the market price of the common stock on the date of
exercise exceeded the exercise price by (ii) the number of
shares for which the options were exercised. |
No restricted stock or restricted stock unit awards were granted
or vested during 2007 and no officers held restricted stock
awards or restricted stock unit awards in 2007. No stock
appreciation rights were exercised by the executive officers
during the 2007 fiscal year, and none of those executive
officers held any stock appreciation rights in 2007.
Pension
Benefits
Actuate does not sponsor a tax-qualified defined benefit
retirement plan or a supplemental executive retirement plan.
22
Nonqualified
Deferred Compensation
Actuate does not sponsor a nonqualified deferred compensation
plan.
Termination
of Employment and Change in Control Agreements
Summary
Upon a Change in Control, each outstanding award under the 1998
Plan will vest and become immediately exercisable as to all the
shares subject to such award if that award is not assumed by the
surviving corporation or its parent or otherwise replaced with a
substitute award with substantially the same terms or preserving
the economic value of that award. In the event of an involuntary
termination of the optionees employment within
12 months following a Change in Control in which the award
is assumed or replaced, the vesting of each award held by such
individual will accelerate in full.
Under the 1998 Plan a Change in Control is defined as (i) a
merger or consolidation after which Actuates then current
stockholders own less than 50% of the surviving corporation,
(ii) a sale of all or substantially all of the assets of
Actuate, (ii) a proxy contest that results in replacement
of more than one-third of the directors over a
24-month
period or (iv) an acquisition of 50% or more of
Actuates outstanding stock by a person other than a
trustee of any of Actuates employee benefit plans or a
corporation owned by the stockholders of Actuate in
substantially the same proportions as their stock ownership in
Actuate.
In December 2007, Actuate amended the change of control
severance benefit agreements (the Severance
Agreements) with each of the following executive officers:
Messrs. Cittadini, Gaudreau, Coggins and Akiha and
Ms. Vogt in order to conform certain provisions in those
agreements to recent changes in the federal tax laws. The
Severance Agreements were originally entered into in October
2005. Pursuant to the terms of the Severance Agreements (as
amended) in the event the executive officers employment
with Actuate terminates pursuant to an involuntary termination,
or his or her resignation for good reason, within 12 months
following a change in control of Actuate, or should such
executive officers employment be terminated by Actuate for
any reason other than for cause during the period commencing
with Actuates execution of a definitive agreement to
effect a change in control of Actuate and ending on the earliest
to occur of (i) the closing of the change in control
contemplated by such definitive agreement or (ii) the
termination of such definitive agreement without the
consummation of the contemplated change in control (the
Pre-Closing Period), then the executive
officers will become entitled to receive the following
change in control severance benefits, provided the executive
officer executes a general release of all claims against
Actuate: (i) each outstanding option held by the executive
officer will become fully vested and exercisable, (ii) a
lump-sum cash severance payment in an amount equal to 1.5 times
(1 times for Mr. Akiha, Mr. Coggins and Ms. Vogt)
the sum of (a) the executives annual rate of base
salary and (b) the executives average bonus (measured
over the 3 years prior to the year of termination), and
(iii) continued health care coverage at Actuates
expense for a period of up to 18 months (up to
12 months for Mr. Akiha, Mr. Coggins and
Ms. Vogt). However, the executives right to certain
of those benefits will be dependent upon the consummation of an
actual change in control. Any severance benefits which are
treated as parachute payments under Section 280G of the
Internal Revenue Code will be subject to reduction, to the
extent such reduction would provide the executive officer with
the greatest after-tax amount of benefits after taking into
account any excise tax to which he or she might be subject under
Section 4999 of the Internal Revenue Code.
Quantification
of Benefits
The charts below indicate the potential payments each of our
executive officers would receive under their Severance
Agreements based upon the following assumptions:
(i) the executives employment terminated on
December 31, 2007 under circumstances entitling the
executive to severance benefits under the executives
Severance Agreement,
(ii) as to any benefits tied to the executives rate
of base salary, the rate of base salary is assumed to be the
executives rate of base salary as of December 31,
2007, and
23
(iii) the change in control is assumed to have occurred on
December 31, 2007 and the change in control consideration
paid per share of outstanding common stock is assumed to be
equal to the closing selling price of our common stock on
December 31, 2007, which was $7.77 per share.
Because the amounts reported below are based on hypothetical
circumstances, the amounts payable upon an actual change in
control could differ, perhaps materially, from those reported
herein.
NOTE: In the table below you might want to add a final column
which shows the total value of the severance package, as
recommended by the SEC Staff
Change in
Control Severance Benefits (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
|
|
|
Value of Health
|
|
|
Value of Unvested
|
|
|
|
|
|
|
Severance
|
|
|
Coverage
|
|
|
Options
|
|
|
Combined
|
|
Executive Officer
|
|
($)(2)
|
|
|
($)
|
|
|
($)(3)
|
|
|
Total Value
|
|
|
Peter I. Cittadini
|
|
|
1,332,364
|
|
|
|
23,908
|
|
|
|
1,876,986
|
|
|
|
3,233,257
|
|
Daniel A. Gaudreau
|
|
|
980,784
|
|
|
|
23,908
|
|
|
|
1,244,688
|
|
|
|
2,249,379
|
|
Ilene M. Vogt
|
|
|
389,167
|
|
|
|
9,269
|
|
|
|
637,625
|
|
|
|
1,036,060
|
|
Mark A. Coggins
|
|
|
143,362
|
|
|
|
5,644
|
|
|
|
572,548
|
|
|
|
721,554
|
|
N. Nobby Akiha
|
|
|
280,939
|
|
|
|
15,939
|
|
|
|
518,125
|
|
|
|
815,002
|
|
|
|
|
(1) |
|
Any benefits payable under the Severance Agreement which are
treated as parachute payments under Section 280G of the Internal
Revenue Code will be subject to reduction, to the extent such
reduction would provide the executive officer with the greatest
after-tax amount of benefits after taking into account any
excise tax to which he or she might be subject under Section
4999 of the Internal Revenue Code. |
|
(2) |
|
As of December 31, 2007, the three year average bonus, upon
which a portion of the cash severance amount is calculated, for
each executive officer was as follows: Mr. Cittadini,
$458,242; Mr. Gaudreau, $353,856; Ms. Vogt, $164,167;
Mr. Coggins, $56,724 and Mr. Akiha, $55,939. |
|
(3) |
|
Represents the intrinsic value of each stock option which vests
on an accelerated basis in connection with the change in control
or termination of employment and is calculated by multiplying
(i) the aggregate number of equity awards which vest on
such an accelerated basis by (ii) the amount by which the
$7.77 closing selling price of our common stock on
December 31, 2007 exceeds any exercise price payable per
vested share. |
CERTAIN
RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR
INDEPENDENCE
Actuate agreed to reimburse SkyFarm LLC up to $100,000 for
business transportation services provided to Mr. Nierenberg
in 2007. Mr. Nierenberg, Actuates Chairman of the
Board and Chief Architect, is the General Partner of SkyFarm LLC.
Actuates Bylaws provide that Actuate shall indemnify its
directors and officers to the fullest extent permitted by
Delaware law, including in circumstances in which
indemnification is otherwise discretionary under Delaware law.
Actuate has entered into indemnification agreements with its
directors containing provisions that may require Actuate, among
other things, to indemnify such officers and directors against
certain liabilities that may arise by reason of their status or
service as officers and directors (other than liabilities
arising from willful misconduct of a culpable nature) and to
advance their expenses incurred as a result of any proceeding
against them as to which they could be indemnified. Actuate also
maintains insurance policies covering officers and directors
under which the insurers agree to pay, subject to certain
exclusions, for any claim made against the officers and
directors of Actuate for a wrongful act that they may become
legally obligated to pay for or for which Actuate is required to
indemnify the officers or directors.
For a director to be considered independent, the Board must
determine that the director does not have any direct or indirect
material relationship with Actuate. The Board considers all
relevant facts and circumstances in making an independence
determination. The independent directors are named above under
Proposal 1: Election of Directors.
24
In the course of the Boards determination regarding the
independence of each non-employee director, it considered any
and all transactions, relationships and arrangements a director
may have with the Corporation. All members of the Audit,
Compensation, and Corporate Governance/Nominating Committees
must be independent directors. Members of the Audit Committee
must satisfy a Securities and Exchange Commission
(SEC) independence requirement, which provides that
they may not accept directly or indirectly any consulting,
advisory or other compensatory fee from Actuate or any of its
subsidiaries other than their directors compensation.
The Board has determined that, except as noted below, all
members of the Board are independent directors
within the meaning of the applicable listing standards of
Nasdaq. Messrs. Cittadini and Nierenberg are not considered
independent because they are executive officers of Actuate.
COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT
The members of the Board of Directors, the executive officers of
Actuate and persons who hold more than 10% of Actuates
outstanding Common Stock are subject to the reporting
requirements of Section 16(a) of the Securities Exchange
Act of 1934, as amended, which require them to file reports with
respect to their ownership of Actuates Common Stock and
their transactions in such Common Stock. Based upon (i) the
copies of Section 16(a) reports that Actuate received from
such persons during 2007 for their transactions in the Common
Stock and their Common Stock holdings and (ii) the written
representations received from one or more of such persons that
no annual Form 5 reports were required to be filed by them
for 2007, Actuate believes that all reporting requirements under
Section 16(a) for such fiscal year were met in a timely
manner by its executive officers, directors and greater than 10%
stockholders.
COMPENSATION
COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee currently consists of
Messrs. Beitzel, Marshall and Whiteman. None of these
individuals was at any time during 2007, or at any other time,
an officer or employee of Actuate. No executive officer of
Actuate serves as a member of the board of directors or
compensation committee of any entity that has one or more
executive officers serving as a member of Actuates Board
of Directors or Compensation Committee.
REPORT OF
THE COMPENSATION COMMITTEE
Based on its review and discussion of the Compensation
Discussion and Analysis with Actuates management and,
based on that review and discussion, the Compensation Committee
recommends to the Board of Directors that the Compensation
Discussion and Analysis be included in Actuates Proxy
Statement and 2007 Annual Report on
Form 10-K
filed with the Securities and Exchange Commission on
March 14, 2008.
COMPENSATION COMMITTEE
Kenneth E. Marshall, Chairman
George B. Beitzel
Steven D. Whiteman
25
REPORT OF
THE AUDIT COMMITTEE
The following is the report of the Audit Committee with respect
to Actuates audited financial statements for the fiscal
year ended December 31, 2007.
The purpose of the Audit Committee is to assist the Board of
Directors in its oversight of Actuates financial
reporting, internal controls and audit functions. The Audit
Committee Charter describes in greater detail the full duties
and responsibilities of the Audit Committee.
The Audit Committee has reviewed and discussed the consolidated
audited financial statements with management and KPMG LLP,
Actuates Independent Registered Public Accountants.
Actuate management is responsible for financial reporting
processes, the preparation of financial statements in accordance
with generally accepted accounting principles and a system of
internal controls and processes designed to help ensure
compliance with applicable accounting standards. KPMG LLP is
responsible for performing an independent audit of the
consolidated financial statements and expressing an opinion on
the conformity of those financial statements with generally
accepted accounting principles.
During 2007, the Audit Committee held 4 meetings. The meetings
were conducted to permit open communication among the members of
the Audit Committee, KPMG LLP and Actuate management. Among
other things, the Audit Committee discussed with KPMG LLP the
plans and scope of their audit. The Audit Committee met with
KPMG LLP with and without management present to discuss the
results of their work and their opinions and recommendations
with respect to Actuates internal controls and processes.
The Audit Committee has also reviewed and approved the fees paid
to KPMG LLP for audit and non-audit services.
The Audit Committee has discussed with KPMG LLP the matters
required to be discussed by Statement of Auditing Standards
No. 114 The Auditors Communication with those
Charged with Governance, which includes, among other items,
a review of KPMGs findings during its examination of
Actuates financial statements. The Audit Committee has
also reviewed the written disclosures and a letter from KPMG LLP
required by Independence Standards Board Standard No. 1
which relates to the accountants independence from
Actuate, and has discussed with KPMG LLP their independence from
Actuate.
Based on the review and discussions referred to above, the Audit
Committee recommended to Actuates Board of Directors that
the audited financial statements be included in Actuates
Annual Report on
Form 10-K
for the fiscal year ended December 31, 2007.
AUDIT COMMITTEE
Steven D. Whiteman, Chairman
George B. Beitzel
Kenneth E. Marshall
26
STOCKHOLDER
PROPOSALS FOR 2009 ANNUAL MEETING
Stockholder proposals that are intended to be presented at the
annual meeting of stockholders to be held in calendar year 2009
must be received by December 25, 2008 in order to be
included in the proxy statement and proxy relating to that
meeting. Stockholder proposals should be addressed to Corporate
Secretary, Actuate Corporation, 2207 Bridgepointe Parkway,
Suite 500, San Mateo, California 94404.
In addition, the proxy solicited by the Board of Directors for
the 2009 annual meeting of stockholders will confer
discretionary authority to vote on any stockholder proposal
presented at that meeting, unless Actuate is provided with
notice of such proposal no later than March 10, 2009.
OTHER
MATTERS
The Board knows of no other matters to be presented for
stockholder action at the Annual Meeting. However, if other
matters do properly come before the Annual Meeting or any
adjournments or postponements thereof, the Board intends that
the persons named in the proxies will vote upon such matters in
accordance with their best judgment.
Actuate will mail without charge, upon written request, a copy
of Actuates Annual Report on
Form 10-K
for the fiscal year ended December 31, 2007, excluding
exhibits. Requests should be sent to Actuate Corporation, 2207
Bridgepointe Parkway, Suite 500, San Mateo, California
94404, Attn: Investor Relations. The Annual Report can also be
viewed on our website at www.actuate.com.
By Order of the Board of Directors,
Nicolas C. Nierenberg
Chairman of the Board
and Chief Architect
San Mateo, California
April 16, 2008
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE
COMPLETE, SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY
IN THE ENCLOSED POSTAGE-PAID ENVELOPE. YOU MAY REVOKE YOUR PROXY
AT ANY TIME PRIOR TO THE ANNUAL MEETING. IF YOU DECIDE TO ATTEND
THE ANNUAL MEETING AND WISH TO CHANGE YOUR PROXY VOTE, YOU MAY
DO SO AUTOMATICALLY BY VOTING IN PERSON AT THE MEETING. THANK
YOU FOR YOUR ATTENTION TO THIS MATTER. YOUR PROMPT RESPONSE WILL
GREATLY FACILITATE ARRANGEMENTS FOR THE ANNUAL MEETING.
27
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![(BAR CODE)](f39047f3904706.gif) |
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![(ACTUATE LOGO)](f39047f3904703.gif) |
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Electronic Voting Instructions
You can vote by Internet or telephone!
Available 24 hours a day, 7 days a
week!
Instead of mailing your proxy, you may choose one of the two voting
methods outlined below to vote your proxy.
VALIDATION
DETAILS ARE LOCATED BELOW IN THE TITLE BAR. |
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MR A SAMPLE
DESIGNATION (IF ANY)
ADD 1
ADD 2
ADD 3
ADD 4
ADD 5
ADD 6
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Proxies submitted by the Internet or telephone must be received by
1:00 a.m., Central Time, on May 20, 2008. |
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Vote by
Internet Log
on to the Internet and go to www.investorvote.com Follow the steps outlined on the secured website. |
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Vote by
telephone Call toll free 1-800-652-VOTE (8683) within the United
States, Canada &
Puerto Rico any time on a touch tone
telephone. There is NO CHARGE to you for the call. |
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Using a black ink pen, mark your votes with an X as shown in
this example. Please do not write outside the designated areas.
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x |
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Follow the instructions provided by the recorded message. |
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Annual Meeting Proxy Card |
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C0123456789 |
12345
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▼
IF YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE,
FOLD ALONG THE PERFORATION, DETACH AND RETURN
THE BOTTOM PORTION IN THE ENCLOSED
ENVELOPE. ▼
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A
Proposals The Board of Directors recommends a vote FOR
all the nominees listed and FOR Proposal 2. |
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1. |
Election of Directors: |
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For |
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Withhold |
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For |
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Withhold |
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For |
Withhold |
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01 - George B. Beitzel |
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02 - Peter l. Cittadini |
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03 - Kenneth E. Marshall |
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04 - Nicolas C. Nierenberg |
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05 - Arthur C. Patterson |
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06 - Steven D. Whiteman |
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For |
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Against |
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Abstain |
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2. |
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To ratify the
appointment of KPMG LLP as the Companys Independent Registered Public Accountants for the fiscal year ending December 31, 2008. |
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3. |
In their discretion, the proxies are authorized to vote upon such other business as may properly come before the Annual Meeting. |
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B Non-Voting
Items |
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Change of Address
Please print new address below.
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C |
Authorized
Signatures
This section must be completed for your vote to be counted.
Date and Sign Below
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Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.
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Date (mm/dd/yyyy) Please print date below.
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Signature 1 Please keep signature within the box.
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Signature 2 Please keep signature within the box. |
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/ / |
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n |
![(BAR CODE)](f39047f3904711.gif) |
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▼IF
YOU HAVE NOT VOTED VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.▼
Proxy Actuate Corporation
2207 Bridgepointe Parkway, Suite 500
San Mateo, CA 94404
This Proxy is Solicited on Behalf of the Board of Directors of Actuate Corporation
for the Annual Meeting of Stockholders to be held May 21, 2008
The undersigned holder of
Common Stock, par value $0.001, of Actuate Corporation (the Company) hereby appoints
Peter I. Cittadini and Daniel A. Gaudreau, or either of them, proxies for the
undersigned, each with full power of substitution, to represent and to vote as
specified in this Proxy all Common Stock of the Company that the undersigned stockholder
would be entitled to vote if personally present at the Annual Meeting of Stockholders (the
Annual Meeting) to be held on Wednesday, May 21, 2008 at 9:00 a.m., local time, at the Companys principal executive offices located at 2207 Bridgepointe Parkway, Suite 500, San Mateo, CA 94404, and at any adjournments or postponements of the Annual Meeting. The undersigned
stockholder hereby revokes any proxy or proxies heretofore executed for such matters.
This proxy, when properly executed, will be voted in the manner as directed herein by the undersigned stockholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE DIRECTORS AND FOR PROPOSAL 2, AND IN THE DISCRETION OF THE PROXIES AS TO ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING. The undersigned stockholder may revoke this proxy at any time before it
is voted by delivering to the Corporate Secretary of the Company either a written
revocation of the proxy or a duly executed proxy bearing a later date, or
by appearing at the Annual Meeting and voting in person.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF THE DIRECTORS AND FOR PROPOSAL 2.
PLEASE MARK, SIGN, DATE AND RETURN THIS CARD PROMPTLY USING THE ENCLOSED RETURN ENVELOPE. If you receive more than one proxy card, please sign and return ALL cards in the enclosed envelope.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)