<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
Bindview Development Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
-----------------------------------------------------------------------
(4) Date Filed:
-----------------------------------------------------------------------
<PAGE> 2
[BindView Development Corporation Logo]
April 5, 2000
Dear Fellow Shareholder:
I am pleased to invite you to attend BindView Development Corporation's
2000 Annual Shareholders' Meeting. We will hold the meeting at 9:00 a.m. on
Friday, May 5, 2000, at BindView's corporate office located at 5151 San
Felipe, 22nd Floor, Houston, Texas 77056.
The formal Notice of Meeting and proxy statement that follow this letter
describe the matters to be considered and voted on at the meeting. We have
enclosed a proxy card so that you may grant your proxy to be voted as you
indicate. We have also enclosed a copy of our 1999 Annual Report. We encourage
you to read these materials.
Your vote is important. PLEASE COMPLETE AND MAIL YOUR PROXY CARD
PROMPTLY, whether or not you plan to attend the annual meeting. If you attend
the meeting you may vote in person even if you have mailed a signed and dated
proxy.
The board of directors recommends that you approve the proposals described
in the attached proxy statement. Thank you for your cooperation. The rest of
the board of directors and I look forward to seeing you at the meeting.
Very truly yours,
/s/ ERIC J. PULASKI
----------------------
Eric J. Pulaski
Chairman of the Board
<PAGE> 3
[BINDVIEW DEVELOPMENT CORPORATION LOGO]
April 5, 2000
Dear Fellow Shareholder:
I am pleased to invite you to attend BindView Development Corporation's
2000 Annual Shareholders' Meeting. We will hold the meeting at 9:00 a.m. on
Friday, May 5, 2000, at BindView's corporate office located at 5151 San Felipe,
22nd Floor, Houston, Texas 77056.
The formal notice of meeting and proxy statement that follow this letter
describe the matters to be considered and voted on at the meeting. We have
enclosed a proxy card so that you may grant your proxy to be voted as you
indicate. We have also enclosed a copy of our 1999 Annual Report and 1999 Form
10-K. We encourage you to read these materials.
Your vote is important. PLEASE COMPLETE AND MAIL YOUR PROXY CARD PROMPTLY,
whether or not you plan to attend the annual meeting. If you attend the meeting
you may vote in person even if you have mailed a signed and dated proxy.
The board of directors recommends that you approve the proposals described
in the attached proxy statement. Thank you for your cooperation. The rest of the
board of directors and I look forward to seeing you at the meeting.
Very truly yours,
/s/ ERIC J. PULASKI
----------------------
Eric J. Pulaski
Chairman of the Board
<PAGE> 4
BINDVIEW DEVELOPMENT CORPORATION
5151 SAN FELIPE, 22ND FLOOR
HOUSTON, TEXAS 77056
---------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
---------------------
BindView Development Corporation will hold its 2000 Annual Meeting of the
Shareholders on Friday, May 5, 2000, at 9:00 a.m. at BindView's corporate office
located at 5151 San Felipe, 22nd Floor, Houston, Texas 77056.
At the meeting, we will:
- elect two directors and ratify the appointment by the board of directors
of two additional directors;
- consider and vote on amendments to the BindView Development Corporation
Omnibus Incentive Plan increasing the aggregate number of shares of
Common Stock available for issuance under that plan by 4.5 million shares
and effecting other changes as described in the attached proxy statement;
and
- transact any other business that may properly come before the meeting.
By Order of the Board of Directors,
/s/ ERIC J. PULASKI
Eric J. Pulaski
Chairman of the Board
Houston, Texas
April 5, 2000
PLEASE VOTE -- YOUR VOTE IS IMPORTANT
<PAGE> 5
BINDVIEW DEVELOPMENT CORPORATION
PROXY STATEMENT
- --------------------------------------------------------------------------------
This proxy statement relates to the solicitation of proxies by the board of
directors of BindView Development Corporation for use at BindView's 2000 annual
meeting of shareholders. The meeting will be held at 9:00 a.m. on Friday, May 5,
2000, at BindView's corporate office located at 5151 San Felipe, 22nd Floor,
Houston, Texas 77056.
You are entitled to vote at that meeting if you were a holder of record of
BindView Development Corporation common stock at the close of business on March
28, 2000. On April 5, 2000, we began mailing to shareholders entitled to vote at
the meeting a proxy card, this proxy statement, our 1999 Annual Report and our
1999 Form 10-K. On March 28, 2000, there were 51,613,396 shares of BindView's
common stock outstanding. Each share of common stock entitles the holder to one
vote on each matter considered at the meeting.
Your proxy card will appoint Eric J. Pulaski and Richard P. Gardner as
proxy holders, or your representatives, to vote your shares as you indicate. If
you sign, date and return your proxy card without specifying voting
instructions, the proxy holders will vote your shares FOR the election of the
director nominees named in this proxy statement, FOR the ratification of the
appointment of the directors named in this proxy statement and FOR the plan
amendment described in this proxy statement.
Signing, dating and returning your proxy card does not preclude you from
attending the meeting and voting in person. If you submit more than one proxy,
the latest-date proxy will automatically revoke your previous proxy. You may
revoke your proxy at any time before it is voted at the meeting by:
- Delivering a signed written revocation letter, dated later than the
proxy, to BindView, attention: Shanoop Kothari; or
- Attending the meeting and voting in person or by proxy. Attending the
meeting alone will not revoke your proxy.
On the enclosed form of proxy, you may vote for or withhold authority to
vote for each of the director nominees listed in this proxy statement and vote
for or against or withhold authority to vote for each other proposal.
The board of directors expects the nominees named in this proxy statement
to be available for election. If either nominee is not available, and you have
submitted a signed and dated proxy card that does not withhold authority to vote
for that nominee, the proxy holders may vote your shares for a substitute. We
are not aware of any matters to be brought before the meeting other than those
described in this proxy statement. If any other matters are properly brought
before the meeting, the persons named in the enclosed proxy will vote your
shares in accordance with their best judgment.
No business can be conducted at the meeting unless a majority of all
outstanding shares entitled to vote are either present at the meeting in person
or represented by proxy.
Representatives of Chase Mellon Shareholder Services L.L.C., the transfer
agent and registrar for the common stock, will act as the independent inspector
of election.
Share information in this proxy statement gives effect to the one-for-one
stock dividend paid by BindView on February 17, 2000 (the "Stock Split"), unless
indicated otherwise.
1
<PAGE> 6
PROPOSAL 1: ELECTION OF DIRECTORS; RATIFICATION OF APPOINTMENT OF DIRECTORS
At the meeting, you the shareholders will elect two directors and ratify
the appointment of two additional directors that the board of directors has
appointed since the most recent annual meeting of shareholders. The board of
directors is divided into three classes, each class being composed as equally in
number as possible. The classes have staggered three-year terms, with the term
of one class expiring at each annual meeting of shareholders.
The directors in Class II, whose terms expire at the meeting, are John J.
Moores and Scott R. Plantowsky. Messrs. Moores and Plantowsky are nominated to
serve in Class II for another term expiring at the 2003 annual meeting of
shareholders.
The directors in Class III, Peter L. Bloom and Eric J. Pulaski, are serving
terms that expire at the 2001 annual meeting of shareholders. The directors in
Class I are serving terms that expire at the 2002 Annual Meeting of
Shareholders. In addition to Mr. Richard A. Hosley II, who was elected by the
shareholders at BindView's 1999 annual meeting of shareholders, the board of
directors appointed Mr. Leland D. Putterman as a Class I director in August 1999
and Mr. Richard P. Gardner as a Class I director in January 2000. You are being
asked to ratify the appointments of Messrs. Putterman and Gardner.
The two nominees who receive the most votes will be elected to the open
directorships in Class II even if they receive less than a majority of the votes
cast. Abstentions and broker non-votes will not be treated as a vote for or
against any particular director nominee and will not affect the outcome of the
election.
Messrs. Gardner and Putterman have been appointed to Class I directorships
by the board. The proposal to ratify those appointments requires the vote of a
majority of the shares present at the meeting in person or by proxy. Abstentions
will therefore count as a vote against the proposal. Broker non-votes will not
be treated as a vote for or against the proposal and will not affect the outcome
of the proposal.
<TABLE>
<CAPTION>
DIRECTOR
AGE POSITION SINCE
--- -------- --------
<S> <C> <C> <C>
CLASS I DIRECTORS
Richard P. Gardner 46 President and Chief Executive Officer 2000
and Director
Richard A. Hosley II 55 Director 1998
Leland D. Putterman 40 Director 1999
NOMINEES FOR ELECTION FOR CLASS II
John J. Moores(a)(b) 55 Director 1997
Scott R. Plantowsky 36 Vice President and Chief Financial 1997
Officer and Director
CLASS III DIRECTORS
Peter L. Bloom(a)(b) 42 Director 1997
Eric J. Pulaski 36 Chairman of the Board and Chief 1990
Technology Officer
</TABLE>
- ---------------
(a) Member of the Audit Committee
(b) Member of the Compensation Committee
BACKGROUND OF DIRECTORS AND DIRECTOR NOMINEES
Peter L. Bloom has served as a Director of BindView since October 1997. Mr.
Bloom is a Managing Member of General Atlantic Partners, LLC, a private equity
firm that invests globally in software services and related information
technology companies. Prior to joining General Atlantic Partners, LLC in 1996,
Mr. Bloom spent 13 years at Salomon Brothers, an investment banking firm, where
he last was the Managing Director of Salomon's U.S. Technology Division. Mr.
Bloom is on the Board of Directors of Predictive Systems, Inc., a Special
Advisor to the Board of Directors of E-TRADE Securities, Inc. and a board member
of a number of private companies. Mr. Bloom holds a B.A. in Computer Studies and
Economics from Northwestern University.
2
<PAGE> 7
Richard P. Gardner has served as President and Chief Executive Officer and
as a Director of BindView since January 2000. Before joining BindView, Mr.
Gardner had been senior vice president, field operations at BMC since April 1,
1999 and was senior vice president, worldwide sales and marketing from August
1997 to April 1999. He joined BMC as senior vice president, North American
sales, in May 1994. Prior to his career at BMC, he was employed by IBM
Corporation from March 1975 to May 1994 in various sales, marketing, and general
management capacities. Mr. Gardner has a B.S. degree from Louisiana State
University.
Richard A. Hosley II has served as a Director of BindView since January
1998. Since October 1990, Mr. Hosley has been a private investor. From 1980 to
1990, Mr. Hosley was employed by BMC, where he held a variety of positions
including Vice President of Sales and Marketing, President, Chief Executive
Officer and Vice Chairman. Prior to joining BMC, Mr. Hosley was employed by IBM.
Mr. Hosley serves as a director of Logic Works, Inc., a database design software
company, and Peregrine Systems, Inc. Mr. Hosley holds a B.A. in Economics from
Texas A&M University.
John J. Moores has served as a Director of BindView since October 1997. In
1980, Mr. Moores founded BMC Software, Inc. ("BMC"), a vendor of system software
utilities for IBM mainframe computing environments. Mr. Moores served as BMC's
President and Chief Executive Officer from 1980 to 1986 and as Chairman of the
Board of Directors from 1980 to 1992. Before that, Mr. Moores was employed by
IBM and Shell Oil Corporation in various MIS positions. Since December 1994, Mr.
Moores has served as owner and Chairman of the Board of the San Diego Padres
Baseball Club, L.P. and since September 1991 as Chairman of the Board of JMI
Services, Inc., a private investment company. Mr. Moores also serves as Chairman
of the Board of Peregrine Systems, Inc., a publicly held infrastructure
management software company, and numerous privately held companies. Mr. Moores
holds a B.S. in Economics and J.D. from the University of Houston.
Scott R. Plantowsky has served as BindView's Vice President and Chief
Financial Officer since September 1993. Mr. Plantowsky has been a Director of
BindView since October 1997. From January 1986 to August 1993, Mr. Plantowsky
was Vice President and General Manger for Plantowsky's Furniture, a Houston
retail furniture chain. Mr. Plantowsky is currently a General Partner in Century
Development's Student Furniture Partnerships and is a Director of SSP
Properties, a real estate holding company based in Corpus Christi, Texas. Mr.
Plantowsky holds a B.B.A. in Finance from the University of Texas at Austin.
Eric J. Pulaski founded BindView in May 1990 and served as BindView's
Chairman of the Board, President and Chief Executive Officer from its inception
until January 2000, when he recruited Mr. Gardner to serve as President and
Chief Executive Officer. He continues to serve as Chairman of the Board. Before
founding BindView, Mr. Pulaski was employed as Director of the Advanced Services
Division of Network Resources, Inc., a Houston-based systems integration firm.
Mr. Pulaski holds a B.A. in Humanities from the University of Texas at Austin.
Leland D. Putterman has served as a Director of BindView since August 1999.
For four years prior to joining the board, he was vice president of worldwide
marketing for BMC. Prior to his position at BMC Software, Mr. Putterman held
several sales management roles at Oracle Corporation as well as the position of
vice president of product marketing. Mr. Putterman currently is on the board of
several software and Internet companies. He graduated with Honors from Princeton
University in 1982 with a Bachelor of Arts Degree in Economics.
COMMITTEES OF THE BOARD OF DIRECTORS AND MEETING ATTENDANCE
The board of directors has an Audit Committee and Compensation Committee,
each composed of Messrs. Bloom and Moores. During 1999, the board of directors
met four times, the Audit Committee met four times and the Compensation
Committee met once. Each director attended, in person or by telephone, all
meetings held by the board of directors and by the committees on which the
director served.
Audit Committee. The Audit Committee recommends the independent public
auditors appointed by the board of directors to audit our financial statements
and reviews issues raised by those auditors as to the scope of their audit and
their audit report, including any questions and recommendations they may have
relating to our internal accounting and auditing procedures.
3
<PAGE> 8
Compensation Committee. The Compensation Committee recommends to the entire
board the compensation to be paid to our officers and key employees and the
compensation of members of the board of directors. The compensation committee
also makes recommendations to the entire board regarding the grant of stock
options and restricted stock awards.
COMPENSATION OF DIRECTORS
We reimburse our directors for out-of-pocket expenses incurred in attending
board meetings. Except for Messrs. Hosley and Putterman, no member of the board
of directors currently receives any additional cash compensation. Messrs. Hosley
and Putterman each receive $1,000 per board meeting attended. Each of Messrs.
Moores, Hosley and Bloom has received options to acquire 100,000 shares of
common stock at an exercise price of $1.92 per share, and Mr. Putterman has
received options to acquire 40,000 shares of common stock at an exercise price
of $10.00 per share under our 1998 Non-Employee Directors Stock Option Plan.
These options vest in annual installments over five years, except that they vest
in full if BindView is subject to a change in control (as defined in that plan)
or if the optionee dies or becomes disabled. These options expire ten years from
the date of grant or, if earlier, 90 days after the optionee ceases to be a
director or 12 months after the optionee's death.
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information as of March 1, 2000 with respect
to (a) persons known to us to be beneficial owners of five percent or more of
the outstanding shares of BindView's common stock, (b) the Named Executive
Officers identified in the Summary of Executive Compensation appearing elsewhere
in this proxy statement and our directors and (c) all of our executive officers
and directors as a group. Unless otherwise noted, we believe that all persons
named in this table have sole voting and investment power with respect to all
shares of common stock beneficially owned by them.
<TABLE>
<CAPTION>
BENEFICIAL OWNER SHARES PERCENTAGE(1)
- ---------------- ---------- -------------
<S> <C> <C>
Eric J. Pulaski............................................. 9,861,118 19.1%
Pilgrim Baxter & Associates, Ltd.(3)........................ 4,499,800 8.7
Marc R. Camm(3)............................................. 100,389 *
Paul J. Cormier(4).......................................... 92,263 *
Scott R. Plantowsky(5)...................................... 2,403,535 4.7
David E. Pulaski(6)......................................... 1,021,404 2.0
Richard A. Hosley II........................................ -- *
John J. Moores.............................................. -- *
Peter L. Bloom(7)........................................... 2,508,864 4.9
All executive officers, directors and Nominees as a
group(7).................................................. 15,794,921 30.8%
</TABLE>
- ---------------
* Less than 1%
(1) In accordance with the guidelines of the Securities and Exchange Commission
(the "Commission"), each beneficial owner's percentage ownership is
determined by assuming that options held by such person and exercisable
within 60 days have been exercised.
(2) In a Schedule 13G filed with the Commission on June 7, 1999, Pilgrim Baxter
& Associates, Ltd. reports sole dispositive power with respect to all of
these shares and sole voting power with respect to 3,892,400 of these
shares. The business address of Pilgrim Baxter & Associates, Ltd. is 825
Duportail Road, Wayne, PA 19087.
(3) Includes 99,157 shares of common stock issuable on exercise of outstanding
stock options.
(4) Includes 91,501 shares of common stock issuable on exercise of outstanding
stock options.
(5) Includes 1,430,000 shares of common stock issuable on exercise of
outstanding stock options.
(6) Includes 450,000 shares of common stock issuable on exercise of outstanding
stock options.
(7) Based on a Schedule 13D filed with the Commission on August 20, 1999, these
shares are beneficially owned by each of General Atlantic Partners 44, L.P.
("GAP 44"), General Atlantic Partners, LLC ("GAP") and GAP Coinvestment
Partners, L.P. ("GAPCO", and collectively with GAP 44 and GAP, the "GAP
Entities"). The GAP Entities share the voting and dispositive power of these
shares. The business address of each of the GAP Entities is 3 Pickwick
Plaza, Greenwich, Connecticut 06830. Peter L. Bloom is a managing member of
GAP and a general partner of GAPCO. Mr. Bloom disclaims beneficial ownership
of such securities, and inclusion in this table shall not be an admission of
beneficial interest.
(8) See notes (3) through (8) to this table. Includes an aggregate of 1,880,000
shares of common stock issuable upon the exercise of outstanding stock
options.
4
<PAGE> 9
EXECUTIVE OFFICERS AND COMPENSATION
The following table shows the names, ages and titles of our executive
officers and certain other key employees.
<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Richard P. Gardner.................... 46 President and Chief Executive Officer
Eric J. Pulaski....................... 36 Chairman of the Board and Chief
Technology Officer
Marc R. Camm.......................... 38 Vice President of Marketing
Paul J. Cormier....................... 43 Vice President of Research &
Development
Scott R. Plantowsky................... 36 Vice President and Chief Financial
Officer
David E. Pulaski...................... 31 Vice President of Worldwide Sales
Jeffrey E. Margolis................... 37 Vice President of Business Development
</TABLE>
For further information regarding Mr. Gardner's, Mr. Eric J. Pulaski's and
Mr. Plantowsky's background, see "Background of Directors."
Marc R. Camm joined BindView as the Vice President of Marketing in
connection with BindView's acquisition of Netect Ltd. in March 1999. Mr. Camm
had served as Executive Vice President of Marketing for Netect since July 1997.
Prior to joining Netect, Mr. Camm was a general manager of Symantec Corporation
from 1994 to 1997. Prior to that, Mr. Camm was the systems group product manager
for Microsoft Canada Co.
Paul J. Cormier joined BindView as the Vice President of Research and
Development in connection with BindView's acquisition of Netect Ltd. in March
1999. Mr. Cormier had served as Vice President of Research & Development and
Chief Technology Officer of Netect since September 1998. Prior to joining
Netect, Mr. Cormier was the Director of Software Engineering for Digital's
Internet Software group, which later became AltaVista.
David E. Pulaski has served as BindView's Vice President of Sales since
February 1999. From January 1998 to February 1999, Mr. Pulaski was Vice
President of Sales. From July 1995 to January 1998, Mr. Pulaski was Director of
Domestic Sales for BindView. From February 1993 to July 1995, Mr. Pulaski served
BindView as a sales Representative and then as sales manager. Prior to joining
BindView in February 1993, Mr. Pulaski was a licensed securities broker for
Paine Webber and Lehman Brothers. Mr. Pulaski is the brother of Eric J. Pulaski.
Jeffrey E. Margolis currently serves as Vice President of Business
Development for BindView. Mr. Margolis is responsible for corporate and
technology acquisitions, licensing and partnering agreements as well as other
corporate matters. Prior to joining BindView, Mr. Margolis worked in investment
banking, merchant banking, venture capital and financial services in Houston,
Texas and New York.
All officers of BindView hold office until the regular meeting of directors
following the annual meeting of shareholders or until their respective
successors are duly elected and qualified or their earlier resignation or
removal.
5
<PAGE> 10
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the board of directors, which is composed of
non-employee directors, has furnished the following report on executive
compensation.
Executive Compensation Program
Our executive compensation program is designed to attract, motivate and
retain talented management personnel and to reward management for BindView's
successful financial performance and for increasing shareholder value.
BindView's compensation program consists of three principal elements: base
salary, performance bonus and stock options. Together these elements comprise
total compensation value. The Committee believes that the total compensation
program for executives of BindView is competitive with the compensation programs
provided by other comparable companies.
Base Salary: Mr. Eric J. Pulaski's 1999 base salary was based on his
position, responsibility, level of experience, and on his individual performance
and BindView's performance in prior years. During 1999, BindView entered into
employment agreements with each of Messrs. Camm and Cormier in connection with
BindView's acquisition of Netect Ltd. The base salaries paid to these two
executives were as provided in these agreements and were determined by
arm's-length negotiations between BindView and each executive based on each
executive's proposed position and responsibility, his level of experience in
BindView's industry and his anticipated contribution to BindView's performance.
Before BindView's initial public offering, and before the formation of the
Compensation Committee, BindView entered into an employment agreement with each
of Messrs. Plantowsky and David E. Pulaski. The 1999 base salaries for these
executives were based on these employment agreements.
Annual Performance Bonuses: Total compensation for executives also includes
cash bonuses. The 1999 cash bonus awards were based on BindView's revenue growth
and profitability as well as each individual's position, responsibility and
level of experience.
Stock Options: Total compensation for executives also includes long term
incentives in the form of stock options, which are generally provided through
initial stock option grants at the date of hire and periodic additional stock
option grants. Stock options are instrumental in promoting the alignment of
long-term interests between BindView's management and shareholders because an
option holder realizes gains only if the stock price increases over the fair
market value at the date of grant. In determining the amount of option grants,
we evaluate the position of the employee, responsibility of the employee and
overall compensation package. All options are granted at 100% of fair market
value at the date of grant. The long-term value realized by management through
option exercises is directly linked to the enhancement of shareholder value.
Applicable Tax Code Provision. The compensation committee has reviewed the
potential consequences for BindView of Section 162(m) of the Internal Revenue
Code, which limits the tax deduction a company can claim for annual compensation
in excess of $1 million to certain executives. This limit did not impact
BindView in 1999 and is not expected to impact BindView in 2000.
COMPENSATION COMMITTEE:
Peter L. Bloom
John J. Moores
6
<PAGE> 11
SUMMARY OF EXECUTIVE COMPENSATION
The following table summarizes compensation information for the Chief
Executive Officer and each of BindView's four most highly compensated executive
officers serving as of December 31, 1999, based on compensation earned during
the fiscal year ended December 31, 1999 (the "Named Executive Officers").
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
--------------------------
ANNUAL COMPENSATION RESTRICTED SECURITIES
------------------- STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS AWARDS OPTIONS(#)(1) COMPENSATION(2)
- --------------------------- ---- -------- -------- ---------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Eric J. Pulaski....................... 1999 $150,000 $ 61,086
Chairman & Former President 1998 148,125 66,508 -- -- $10,000
& Chief Executive Officer(3) 1997 141,000 36,044 -- -- 9,500
Marc R. Camm(4)....................... 1999 143,006 41,633 437,500 4,279
Vice President of Marketing
Paul J. Cormier(4).................... 1999 131,835 44,547 437,500 2,836
Vice President of Research and
Development
Scott R. Plantowsky................... 1999 132,292 53,446 450,000 5,000
Chief Financial Officer 1998 110,000 104,164 -- -- 10,000
1997 110,000 113,179 1,335,000 3,000,000 9,500
David E. Pulaski...................... 1999 117,750 63,449 375,000 5,000
Vice President of 1998 96,000 136,774 -- 75,000 8,010
Worldwide Sales 1997 65,000 121,225 1,335,000 375,000 9,500
</TABLE>
- ---------------
(1) Gives effect to the Stock Split.
(2) "All other compensation" for the year ended December 31, 1999, includes
BindView's contributions to the BindView Development Corporation 401(k)
Profit Sharing Plan.
(3) Mr. Eric J. Pulaski served as President and Chief Executive Officer until
January 2000. He continues to serve as Chairman and Chief Technology
Officer.
(4) Messrs. Camm and Cormier joined BindView in March 1999.
OPTION GRANTS FOR FISCAL YEAR ENDED DECEMBER 31, 1999
This table shows information concerning individual grants of stock options
made during the year ended December 31, 1999, to each of the Named Executive
Officers.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
SHARES OF PERCENT OF OF STOCK PRICE APPRECIATION
COMMON STOCK TOTAL OPTIONS EXERCISE FOR OPTION TERM(2)
UNDERLYING GRANTED TO PRICE PER ----------------------------
NAME OPTIONS(#)(1) EMPLOYEES SHARE($) EXPIRATION 5%($) 10%($)
- ---- ------------- ------------- --------- ---------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Eric J. Pulaski............. -- -- -- -- -- --
Marc R. Camm................ 437,500 11.9 11.19 3/09 3,078,832 7,802,365
Paul J. Cormier............. 437,500 11.9 11.19 3/09 3,078,832 7,802,365
Scott R. Plantowsky......... 250,000 16.8 9.16 5/09 1,440,168 3,649,670
150,000 4.1 10.00 10/09 943,341 2,390,613
50,000 1.4 13.31 10/09 418,529 1,060,635
David E. Pulaski............ 300,000 8.2 11.25 2/09 2,122,519 5,378,880
75,000 2.0 10.00 10/09 471,670 1,195,306
</TABLE>
- ---------------
(1) Gives effect to the Stock Split.
(2) The potential realizable value of the options is based on an assumed
appreciation in the price of the common stock at a compounded annual rate of
5% or 10% from the date the option was granted until the date the option
expires. The 5% and 10% appreciation rates are set forth in the Commission's
regulations. BindView does not represent that the common stock will
appreciate at these assumed rates.
7
<PAGE> 12
OPTION EXERCISES AND FISCAL YEAR END OPTION VALUES
This table shows all stock options exercised by the Named Executive
Officers during the fiscal year ended December 31, 1999, and the number and
value of options each held at fiscal year end.
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT "IN-THE-MONEY" OPTIONS AT
SHARES VALUE DECEMBER 31, 1999(#)(1) DECEMBER 31, 1999($)(3)
ACQUIRED ON REALIZED --------------------------- ---------------------------
EXERCISE(#)(1) ($)(2) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
-------------- --------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Eric J. Pulaski.......... -- -- -- -- -- --
Marc R. Camm............. 48,678 467,307 1,281 449,063 $ 28,943 $ 6,235,973
Paul J. Cormier.......... 8,000 115,000 1,334 452,168 $ 30,140 $ 6,306,128
Scott R. Plantowsky...... 200,000 2,105,720 761,250 668,750 $18,172,488 $12,013,163
David E. Pulaski......... -- -- 15,000 435,000 $ 343,800 $ 6,566,700
</TABLE>
- ---------------
(1) Gives effect to the Stock Split.
(2) The value realized equals the difference between the option exercise price
and the closing price of BindView stock on the date of exercise, multiplied
by the number of shares to which the exercise relates.
(3) The value of the unexercised "in-the-money" options equals the difference
between the option exercise price and the closing price of BindView stock at
fiscal year end, multiplied by the number of shares underlying the options.
The closing price of BindView stock on December 31, 1999, giving effect to
the Stock Split, as reported on the Nasdaq Stock Market was $24.84.
COMMON STOCK PERFORMANCE COMPARISONS
This performance graph compares the performance of BindView's common stock
to the Nasdaq Stock Market (U.S.) Index and the Standard & Poor's Computers
(Software & Services) Index. The graph assumes an investment in BindView's
common stock and each index of $100 at June 30, 1998, in the case of the indexes
and at July 24, 1998, the effective date of BindView's initial public offering,
in the case of BindView stock, and that all dividends were reinvested.
[Performance Graph]
<TABLE>
<CAPTION>
7/24/98 12/31/98 12/31/99
------------ ------------ ------------
<S> <C> <C> <C>
BindView Development Corporation...................... 100 275 497
Nasdaq Stock Market (U.S.)............................ 100 117 212
S&P Computers (Software & Services)................... 100 120 221
</TABLE>
This graph is based on historical data and is not necessarily indicative of
future performance. This graph shall not be deemed to be "soliciting material"
or to be "filed" with the Securities and Exchange Commission or subject to the
Regulations of 14A or 14C under the Exchange Act or subject to the liabilities
of Section 18 under the Exchange Act.
8
<PAGE> 13
EMPLOYMENT AGREEMENTS
We have employment agreements with Marc R. Camm, Paul J. Cormier and David
E. Pulaski. Mr. Plantowsky's employment agreement expired on January 1, 2000. He
continues to serve as CFO. We are in discussions with Mr. Plantowsky regarding
renewing his employment agreement.
Marc R. Camm's employment agreement provides for an annual base salary of
$175,000, and incentive bonus compensation based on achieving management based
objectives and revenue and profitability goals. Mr. Camm may terminate the
agreement without giving prior notice. BindView can terminate the employment
agreement upon written notice, with or without cause. BindView may also
terminate the agreement upon the death or disability of Mr. Camm. The agreement
provides for different outcomes depending upon the reason for the termination of
the agreement. Mr. Camm is subject to confidentiality requirements and is
prohibited for 12 months after termination from (i) being employed by or
investing in any business or organization which is in direct competition to any
business which BindView is engaged in or actively contemplating engaging in
during Mr. Camm's term of employment or (ii) hiring or soliciting employees of
BindView.
Paul J. Cormier's employment agreement has similar termination provisions
as Mr. Camm's agreement. In addition, Mr. Cormier is subject to the same
confidentiality and non-compete provisions as Mr. Camm.
David E. Pulaski's employment agreement provides for an annual base salary
of $96,000, subject to review by the Compensation Committee. The Compensation
Committee has discretion to award Mr. Pulaski with annual cash bonuses, stock
option grants and other awards under BindView's existing stock plans. Mr.
Pulaski may terminate his agreement upon two weeks notice, subject to BindView's
right to terminate the agreement immediately for cause or Mr. Pulaski's death.
Mr. Pulaski is prohibited from (i) directly or indirectly engaging in the same
or similar business activities to those carried on by BindView and (ii)
soliciting customers of BindView for a period of 12 months after Mr. Pulaski's
termination.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Peter L. Bloom, a director of BindView, is a member of the Compensation
Committee of the board of directors. Mr. Bloom is a managing member of GAP and a
general partner of GAPCO.
PROPOSAL 2: APPROVAL OF THE AMENDMENT TO THE STOCK OPTION PLAN
At the meeting, you will be asked to approve amendments, collectively, (the
"Plan Amendment") to the BindView Development Corporation Omnibus Incentive Plan
(the "Plan") increasing the number of shares available thereunder to 8.0 million
and adding additional provisions to the Plan for tax reasons. The text of the
Plan Amendment is set forth in Annex A to this proxy statement.
REASONS FOR THE PLAN AMENDMENT
We believe it is in BindView's best interests to attract and retain
experienced and knowledgeable employees and to increase the proprietary interest
of our employees in our long-term success. Under the Plan, we provide full-time
key employees, including officers and directors, with additional incentives to
increase shareholder value.
The Plan provided that we could grant options to purchase common stock and
awards of restricted common stock with respect to a total of up to 3.5 million
shares. The Plan Amendment increased the number of shares of common stock with
respect to which we could grant awards to 8.0 million.
The Plan Amendment also amended certain requirements relating to awards
granted under the Plan so that the Plan will, under United States federal income
tax regulations, generally be more beneficial from a tax standpoint to BindView.
Section 162(m) of the Internal Revenue Code limits the tax deduction the company
can claim for annual compensation in excess of $1 million to certain executives,
subject to certain exceptions. The Plan Amendment was intended to qualify awards
granted under the Plan for these exceptions.
9
<PAGE> 14
The board of directors has adopted the Plan Amendment and directed that it
be presented to the shareholders for their approval.
CERTAIN CONSIDERATIONS
You may be disadvantaged by approval of the Plan Amendment. This
disadvantage may include a reduction in your interest in BindView with respect
to the following if shares of common stock are acquired under the Plan:
- earnings per share
- voting
- liquidation value
- book and market value per share
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE PLAN
AMENDMENT. Approval of the Plan Amendment requires the vote of a majority of the
shares present at the meeting in person or by proxy; abstentions will therefore
count as a vote against the proposal. Broker non-votes will not be treated as a
vote for or against the proposal and will not affect the outcome of the
proposal.
RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP served as BindView's principal independent
public accountants for the 1999 fiscal year. Representatives of
PricewaterhouseCoopers LLP are expected to attend the meeting, will have the
opportunity to make a statement if they so desire and will be available to
respond to appropriate questions.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires BindView's
officers, directors and persons who own more than 10% of a registered class of
BindView's equity securities to file reports of ownership and changes in
ownership with the Securities and Exchange Commission. Officers, directors and
greater than 10% shareholders are required by the regulation to furnish BindView
with copies of all Section 16(a) reports they file.
Based solely on a review of reports on those filings furnished to BindView
and written representations from reporting persons that no additional reports
were required, BindView believes that during the fiscal year ended December 31,
1999, all officers, directors and greater than 10% shareholders complied with
all filing requirements applicable to them, except that Messrs. Camm and Cormier
did not timely file Forms 3.
PROPOSALS FOR NEXT ANNUAL MEETING; OTHER MATTERS
Any proposals of holders of common stock intended to be presented at the
annual meeting of shareholders of BindView to be held in 2001 must be received
by BindView at its principal executive offices, 5151 San Felipe, 22nd Floor,
Houston, Texas 77056, no later than December 6, 2000 to be included in the proxy
statement and form of proxy relating to that meeting.
We are paying the cost of this solicitation of proxies. In addition to
solicitation by use of the mails, the directors, officers or employees of
BindView may solicit the return of proxies by telephone, telecopy or in person.
10
<PAGE> 15
ANNEX A THE PLAN AMENDMENT
The BindView Development Corporation Omnibus Incentive Plan has been
amended as follows:
1. The following definitions have been added to Article II:
" 'Committee' means the Compensation Committee of the Board of Directors or
such other committee designated by the Board of Directors. The Committee shall
be comprised solely of at least two members who are both Non Employee Directors
and Outside Directors."
" 'Non-Employee Director' means a 'Non-Employee Director' as that term is
defined in Rule 16b-3 under the Securities Exchange Act of 1934."
" 'Outside Director' means a member of the Board of Directors serving on
the Committee who satisfies the definition of outside director in Section 162(m)
of the Code."
2. The term "Board" has been changed to "Committee" in Sections 2.13, 2.27,
4.1, 4.4, 4.6, 5.1, 5.2, 5.4, 5.5, 5.6, 5.8, 5.9, 6.1, 6.2, 6.5, 9.3, 9.5 and
9.6 and in Article VII.
3. Article III has been amended to read in its entirety as follows:
"ELIGIBILITY
"The individuals who shall be eligible to receive Incentive Options,
Nonqualified Options, and Stock Awards shall be those key employees of the
Company or any of its Affiliates as the Committee shall determine from time to
time. However, no member of the Committee shall be eligible to receive any
Option, or Stock Award or to receive stock, stock options, or stock appreciation
rights under any other plan of the Company or any of its Affiliates, if to do so
would cause the individual not to be a Disinterested Person or Outside Director.
The Board of Directors may designate one or more individuals who shall not be
eligible to receive any Option or Stock Award under this Plan or under other
similar plans of the Company."
4. Section 4.2 has been amended to read in its entirety as follows:
"4.2 DEDICATED SHARES. The total number of shares of Stock with respect to
which 1998 Incentive Plan Options and Stock Awards may be granted under the Plan
shall be 8,000,000 shares.* The maximum number of shares subject to Options
which may be issued to any Employee under the Plan during each Plan Year is
2,500,000 shares.* The shares may be treasury shares or authorized but unissued
shares. The number of shares stated in this Section 4.2 shall be subject to
adjustment in accordance with the provisions of Section 4.5."
- ---------------
* These numbers give effect to the one-for-one stock dividend paid by BindView
on February 17, 2000.
A-1
<PAGE> 16
BINDVIEW DEVELOPMENT CORPORATION
PROXY - ANNUAL MEETING OF SHAREHOLDERS
May 5, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned holder of Common Stock of BindView Development Corporation
hereby appoints Eric J. Pulaski and Richard P. Gardner, or either of them,
proxies of the undersigned with full power of substitution, to vote at the
Annual Meeting of Shareholders of BindView to be held at 9:00 a.m. on May 5,
2000, at BindView's corporate office located at 5151 San Felipe, 22nd Floor,
Houston, Texas 77056, and at any adjournment or postponement thereof, the
number of votes that the undersigned would be entitled to cast if personally
present.
PLEASE MARK, SIGN, DATE AND RETURN IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO
POSTAGE IF MAILED IN THE UNITED STATES.
(CONTINUED AND TO BE SIGNED ON OTHER SIDE)
<PAGE> 17
(1) ELECTION OF DIRECTORS: John J. Moores, Scott R. Plantowsky
FOR the nominees listed above [ ]
(except as marked to the contrary)
WITHHOLD AUTHORITY [ ]
to vote for the nominees listed above
(Instruction: To withhold authority to vote for any individual
nominee, write that nominee's name on the space provided below.)
--------------------------------
(1A) RATIFICATION OF APPOINTMENT OF DIRECTORS: Richard P. Gardner,
Leland D. Putterman
FOR ratification of the appointment of the directors listed above
(except as marked to the contrary) [ ]
AGAINST ratification of the appointment of the [ ]
directors listed above
WITHHOLD AUTHORITY [ ]
to vote for the ratification of the appointment
of the directors listed above
================================================================================
(2) APPROVAL OF AMENDMENT TO OMNIBUS INCENTIVE PLAN:
FOR [ ]
AGAINST [ ]
ABSTAIN [ ]
IN THEIR DISCRETION, THE ABOVE-NAMED PROXIES ARE AUTHORIZED TO VOTE
UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING OR
ANY ADJOURNMENT THEREOF AND UPON MATTERS INCIDENT TO THE CONDUCT OF
THE MEETING.
This proxy when properly executed will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made this proxy will be
voted FOR the election of the director nominees named in Item 1, or if any one
or more of the nominees becomes unavailable, FOR another nominee or other
nominees to be selected by the Board of Directors, FOR the ratification of the
appointment of the directors in Item 1 and FOR approval of the amendment to the
Omnibus Incentive Plan in Item 2.
Date __________, 2000
-------------------------------------
-------------------------------------
Signature of Shareholder(s)
Please sign your name exactly as it
appears hereon. Joint owners must
each sign. When signing as attorney,
executor, administrator, trustee or
guardian, please give your full
title as such.
