<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
<TABLE>
<S> <C>
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / 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 Section240.14a-11(c) or
Section240.14a-12
SERENA SOFTWARE, INC.
-----------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/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.:
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(3) Filing Party:
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(4) Date Filed:
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</TABLE>
<PAGE>
[SERENA LOGO]
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
JUNE 30, 2000
2:00 P.M.
To the Stockholders of SERENA Software, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of SERENA
Software, Inc., a Delaware corporation ("SERENA"), will be held on Friday,
June 30, 2000, at 2:00 p.m., local time, at SERENA's principal executive offices
at 500 Airport Boulevard, 2nd Floor, Burlingame, California 94010 for the
following purposes:
1. To elect directors to serve until the next Annual Meeting of
Stockholders or until their successors are elected;
2. To ratify the appointment of KPMG LLP as independent accountants for
SERENA for the fiscal year ending January 31, 2001; and
3. To transact such other business as may properly come before the meeting
or any adjournment thereof.
The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice. Only stockholders of record at the close of
business on May 22, 2000, are entitled to notice of and to vote at the meeting.
All stockholders are cordially invited to attend the meeting in person. To
assure your representation at the meeting, however, you are urged to mark, sign,
date, and return the enclosed Proxy as promptly as possible in the
postage-prepaid envelope enclosed for that purpose. YOU MAY REVOKE YOUR PROXY IN
THE MANNER DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT AT ANY TIME BEFORE IT
HAS BEEN VOTED AT THE ANNUAL MEETING. ANY STOCKHOLDER ATTENDING THE ANNUAL
MEETING MAY VOTE IN PERSON EVEN IF HE OR SHE HAS RETURNED A PROXY.
By order of the Board of Directors
SERENA SOFTWARE, INC.
[/S/ ROBERT I. PENDER, JR.]
Robert I. Pender, Jr.
SECRETARY
Burlingame, California
May 29, 2000
YOUR VOTE IS IMPORTANT.
IN ORDER TO ASSURE YOUR REPRESENTATION AT THE MEETING, YOU ARE REQUESTED
TO COMPLETE, SIGN, AND DATE THE ENCLOSED PROXY AS PROMPTLY
AS POSSIBLE AND RETURN IT IN THE ENCLOSED ENVELOPE.
<PAGE>
SERENA SOFTWARE, INC.
------------------
PROXY STATEMENT FOR THE
2000 ANNUAL MEETING OF STOCKHOLDERS
---------------------
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
The enclosed proxy is solicited on behalf of the board of directors of
SERENA Software, Inc., a Delaware corporation ("SERENA"), for use at the Annual
Meeting of Stockholders (the "Annual Meeting") to be held on Friday, June 30,
2000, at 2:00 p.m., local time, or at any adjournment or postponement thereof,
for the purposes set forth herein and in the accompanying Notice of Annual
Meeting of Stockholders. The Annual Meeting will be held at SERENA's principal
executive offices at 500 Airport Boulevard, 2nd Floor, Burlingame, California
94010. The telephone number at that location is (650) 696-1800. When proxies are
properly dated, executed, and returned, the shares they represent will be voted
at the Annual Meeting in accordance with the instructions of the stockholder. If
no specific instructions are given, the shares will be voted for the election of
the nominees for directors set forth herein, for the ratification of the
appointment of KPMG LLP as independent auditors as set forth herein and, at the
discretion of the proxy holders, upon such other business as may properly come
before the Annual Meeting or any adjournment or postponement thereof.
These proxy solicitation materials and the Annual Report to Stockholders for
the year ended January 31, 2000, including financial statements, were first
mailed on or about May 30, 2000, to all stockholders entitled to vote at the
Annual Meeting.
RECORD DATE AND SHARES OUTSTANDING
Stockholders of record at the close of business on May 22, 2000 (the "Record
Date") are entitled to notice of, and to vote at, the Annual Meeting. At the
Record Date, SERENA had issued and outstanding and entitled to vote 39,294,387
shares of Common Stock, $.001 par value.
REVOCABILITY OF PROXIES
Any proxy given pursuant to the solicitation may be revoked by the person
giving it at any time before it is voted. Proxies may be revoked by (i) filing
with the Secretary of SERENA at or before the taking of the vote at the Annual
Meeting a written notice of revocation bearing a later date than the proxy,
(ii) duly executing a later dated proxy relating to the same shares and
delivering it to the Secretary of SERENA at or before the taking of the vote at
the Annual Meeting, or (iii) attending the Annual Meeting and voting in person
(although attendance at the Annual Meeting will not in and of itself constitute
a revocation of a proxy). Any written notice of revocation or subsequent proxy
should be delivered to SERENA Software, Inc. at 500 Airport Boulevard, 2nd
Floor, Burlingame, California 94010, Attention: Secretary, or hand-delivered to
the Secretary of SERENA at or before the taking of the vote at the Annual
Meeting.
VOTING
Each share of Common Stock outstanding on the Record Date is entitled to one
vote. Stockholders' votes will be tabulated by persons appointed by the board of
directors to act as inspectors of election for the Annual Meeting. The holders
of a majority of our outstanding shares of common stock, present in person or by
proxy, will constitute a quorum for the transaction of business at the Annual
Meeting. If a quorum is not present, the Annual Meeting may be adjourned from
time to time until a quorum is obtained. Absentions and broker non-votes are
considered stockholders who are present and entitled to
<PAGE>
vote and they count toward the quorum. A broker non-vote occurs when a nominee
holding shares for a beneficial owner does not vote on a particular proposal
because the nominee does not have discretionary voting power with respect to
that proposal and has not received instructions from the beneficial owner
(despite voting on at least one other proposal for which the nominee does have
discretionary authority or for which it has received instructions). Brokers
holding shares of record for customers generally are not entitled to vote on
certain "non-routine" matters unless they receive voting instructions from their
customers.
SOLICITATION OF PROXIES
The expense of soliciting proxies in the enclosed form will be borne by
SERENA. In addition, SERENA may reimburse banks, brokerage firms, and other
custodians, nominees, and fiduciaries representing beneficial owners of shares
for their expenses in forwarding soliciting materials to such beneficial owners.
Proxies may also be solicited by certain of SERENA's directors, officers, and
employees, personally or by telephone, telegram, facsimile, or other means of
communication. No additional compensation will be paid for such services.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS FOR YEAR 2001 ANNUAL MEETING
Stockholders are entitled to present proposals and nominations to the board
of directors for action at a forthcoming meeting if they comply with the
requirements of the proxy rules promulgated by the Securities and Exchange
Commission. Proposals of stockholders of SERENA intended to be presented for
consideration at SERENA's year 2001 Annual Meeting of Stockholders currently
intended to be held in late June 2001 must be received by SERENA no later than
January 26, 2001, in order that they may be included in the proxy statement and
form of proxy related to that meeting. To be in proper form, the stockholder's
notice to the secretary must set forth, among other things described in SERENA's
by-laws, (i) the name and address of the stockholder requesting the proposal,
(ii) a representation that the stockholder is a stockholder of record of SERENA
entitled to vote at the meeting and, if applicable, whether that stockholder
intends to appear in person or by proxy at the meeting, (iii) a description of
all arrangements or understandings between the stockholder and any nominee and
any other person pursuant to which a nomination is to be made by the
stockholder, (iv) such other information regarding each nominee or matter of
business to be proposed by the stockholder that would be required to be included
in a proxy statement to be filed with the Securities and Exchange Commission,
and (v) if applicable, the consent of each nominee to serve as a director of
SERENA, if so elected.
PROPOSAL ONE
ELECTION OF DIRECTORS
NOMINEES
We currently have four (4) directors. At the Annual Meeting, a board of six
(6) directors will be elected, each to hold office until his or her successor is
elected and qualified, or until his or her death, resignation, or removal.
Shares represented by the accompanying proxy will be voted for the election of
the six nominees (recommended by the board of directors) who are named in the
following table, unless the proxy is marked in such a manner as to withhold
authority so to vote. SERENA has no reason to believe that the nominees for
election will not be available to serve their prescribed terms. If any nominee
for any reason is unable to serve or will not serve, however, the proxy may be
voted for such substitute nominee as the persons appointed in the proxy may in
their discretion determine.
2
<PAGE>
The following table sets forth certain information concerning the nominees,
which information is based on data furnished to SERENA by the nominees:
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE POSITION(S) WITH SERENA SINCE
- - - - - - - ---- -------- --------------------------------------------------- --------
<S> <C> <C> <C>
Douglas D. Troxel......... 55 Chairman of the Board and Chief Technology Officer 1980
Mark E. Woodward.......... 41 President, Chief Executive Officer --
Robert I. Pender, Jr...... 42 Vice President, Finance and Administration --
Chief Financial Officer and Secretary
Richard A. Doerr.......... 57 Director 1997
Alan H. Hunt(1)(2)........ 58 Director 1998
Jerry T. Ungerman(1)(2)... 55 Director 1998
</TABLE>
- - - - - - - ------------------------
(1) Member of Compensation Committee.
(2) Member of Audit Committee.
There is no family relationship among any of the directors and executives of
SERENA.
DOUGLAS D. TROXEL is the founder of SERENA and has served as the Chairman of
SERENA's board of directors since April 1980 and SERENA's Chief Technology
Officer since April 1997. From June 1980 to April 1997, Mr. Troxel served as the
President and Chief Executive Officer of SERENA. Mr. Troxel holds a B.S. in
mathematics from Iowa State University.
MARK E. WOODWARD has served as SERENA's President and CEO since May 2000,
Vice President, Worldwide Operations from February through April, 2000 and as
Vice President, Sales from November 1998 to February, 2000. From August 1997
until November 1998, Mr. Woodward was Senior Vice President, Sales for Live
Picture, Inc., a developer of Internet imaging technology. From August 1995
until August 1997, Mr. Woodward was Vice President, Sales for McAfee Associates,
a network management firm. From March 1989 until August 1995, Mr. Woodward was
Vice President, Sales for Legent, Inc., a developer of software change
management products.
ROBERT I. PENDER, JR. has served as SERENA's Vice President, Finance and
Administration, Chief Financial Officer and Secretary since December 1997. From
December 1996 until August 1997, Mr. Pender was Vice President, Finance of
Mosaix, Inc., a customer interaction software company. From April 1993 until
December 1996, Mr. Pender served in a variety of positions, most recently as
Chief Financial Officer, with ViewStar Corporation, a client/server workflow
software company that was acquired by Mosaix, Inc. in December 1996. Mr. Pender
holds a B.A. in accounting from Baylor University and a M.S. in financial
planning and tax from Golden Gate University.
RICHARD A. DOERR has served as a member of SERENA's board of directors since
1997 and was SERENA's President, Chief Executive Officer from April 1997 through
April 30, 2000. From April 1995 until October 1996, Mr. Doerr was Vice President
of Sales, Service and Distribution for Wall Data Incorporated, a software
connectivity company. From October 1991 until October 1994, Mr. Doerr was Vice
President, Worldwide Operations for Oracle Corporation, a developer of
relational database management software. From August 1986 until October 1991,
Mr. Doerr was Vice President, Western Area and U.S. Healthcare Industry for
Digital Equipment Corporation, a developer of networking solutions for computer
environments. Mr. Doerr holds a B.S. from California Polytechnic State
University.
ALAN H. HUNT has served as a member of SERENA's board of directors since
February 1998. From October 1995 to January 1998, Mr. Hunt was the President and
Chief Executive Officer and a member of the board of directors of Peregrine
Systems, Inc., a provider of infrastructure management software solutions. From
July 1994 until November 1995, Mr. Hunt was President and Chief Executive
Officer and a member of the board of directors of XVT Software Inc., a
development tools software company. From March 1991 until May 1994, Mr. Hunt was
Senior Vice President of Sales and Marketing (North America)
3
<PAGE>
for BMC Software, Inc., a vendor of software system utilities for IBM mainframe
computing environments. Mr. Hunt holds a B.S. in business administration and
industrial management from San Jose State College.
JERRY T. UNGERMAN has served as a member of SERENA's board of directors
since December 1998. Since October 1998, Mr. Ungerman has served as an Executive
Vice President of Check Point Software Technologies Ltd., a developer of
computer network security access software. From July 1971 to October 1998,
Mr. Ungerman was the Executive Vice President of Operations of Hitachi Data
Systems Corp., a provider of computer networking and data storage solutions for
computing environments. Mr. Ungerman holds a B.S.B. in business from the
University of Minnesota.
VOTE REQUIRED AND BOARD OF DIRECTORS' RECOMMENDATION
Directors will be elected by a plurality of the votes of the shares present
and entitled to vote at the Annual Meeting and entitled to vote on the election
of directors. The six nominees who receive the most votes will be elected.
Abstentions and broker non-votes will not be taken into account in determining
the outcome of the election of directors. THE BOARD OF DIRECTORS HAS UNANIMOUSLY
APPROVED THE FOREGOING SLATE OF NOMINEES AND RECOMMENDS THAT STOCKHOLDERS VOTE
FOR THE ELECTION OF THE NOMINEES LISTED ABOVE.
BOARD AND COMMITTEE MEETINGS
SERENA's board of directors held six (6) meetings during the fiscal year
ended January 31, 2000. No incumbent director during fiscal 2000 attended fewer
than seventy-five percent (75%) of the aggregate of (i) the total number of
meetings of the board of directors held during the period for which such person
was a director and (ii) the total number of meetings held by all committees of
the board of directors on which such person served (during the period such
person served) of the meetings of the board of directors held during fiscal
2000. The board of directors has standing Audit and Compensation Committees. The
board of directors does not have a Nominating Committee.
The Audit Committee, comprised of Alan H. Hunt and Jerry T. Ungerman, was
formed in January 1999 in connection to SERENA's initial public offering. The
Audit Committee did not meet in fiscal 2000; rather the Board performed the
Audit Committee functions. The purposes of the Audit Committee are to review
with SERENA's management and independent accountants such matters as internal
accounting controls and procedures, the plan and results of the annual audit,
and suggestions of the accountants for improvements in accounting procedures; to
nominate independent accountants; and to provide such additional information as
the committee may deem necessary to make the board of directors aware of
significant financial matters which require the board's attention, as well as
perform such other functions as may be required by the stock market upon which
our company stock is listed.
The Compensation Committee, comprised of Alan H. Hunt and Jerry T. Ungerman,
was formed in January 1999 in connection with SERENA's initial public offering
of its common stock. The Compensation Committee met one (1) time in fiscal 2000.
The purposes of the Compensation Committee are to review and approve the
compensation to be paid or provided to SERENA's executive officers, the
aggregate compensation of all employees of SERENA, and the terms of compensation
plans of all types and to administer SERENA's Amended and Restated 1997 Stock
Option and Incentive Plan.
COMPENSATION OF THE BOARD OF DIRECTORS
DIRECTOR COMPENSATION
SERENA reimburses each member of our board of directors for out-of-pocket
expenses incurred in connection with attending board meetings. No member of our
board of directors currently receives additional cash compensation.
4
<PAGE>
SERENA's 1999 Director Plan provides that options will be granted to
non-employee directors pursuant to an automatic nondiscretionary grant
mechanism. Each new non-employee director is automatically granted an option to
purchase 37,500 shares of common stock at the time he or she is first elected to
the board of directors. Each non-employee director will subsequently be granted
an option to purchase 7,500 shares of common stock at the beginning of each
fiscal year. Each such option will be granted at the fair market value of the
common stock on the date of grant. Options granted to non-employee directors
under the 1999 Director Plan will become exercisable over four years, with one
quarter of the shares subject to the option vesting after one year and the
remaining shares vesting ratably in monthly installments thereafter.
At the time Mr. Hunt became a member of the board of directors in February
of 1998, SERENA granted Mr. Hunt the right to purchase 84,375 shares of common
stock pursuant to a restricted stock purchase agreement at a purchase price per
share of $0.96. Mr. Hunt paid the purchase price of $81,000 for these shares in
the form of a full recourse promissory note secured by the purchased common
stock. The promissory note bears interest at an annual rate of 5.9%. Under the
terms of that agreement, SERENA has a right to repurchase shares in the event
Mr. Hunt's membership in the board of directors should terminate, provided that
the right of SERENA to repurchase has not lapsed. One quarter of Mr. Hunt's
shares will no longer be subject to any right of repurchase upon the first
anniversary of his membership on the board of directors, and 1/36 of the
remaining shares will be released from the repurchase option monthly thereafter.
In March 1999, Mr. Hunt was granted an additional 7,500 options at $9.29 per
share from the Amended and Restated 1997 Stock Option and Incentive Plan. One
quarter of these shares will vest upon the first anniversary of the grant and
1/36 of the remaining shares will vest monthly thereafter.
At the time Mr. Ungerman became a member of our board of directors in
December of 1998, SERENA granted Mr. Ungerman an option to purchase up to 37,500
shares of common stock at a purchase price of $6.00 per share under the Amended
and Restated 1997 Stock Option and Incentive Plan. One quarter of
Mr. Ungerman's options will vest upon the first anniversary of his membership on
the board of directors, and 1/36 of his remaining options vest monthly
thereafter.
On February 16, 2000, as a result of SERENA's fiscal 2000 financial
performance, both Mr. Hunt and Mr. Ungerman were granted 7,500 options each at
fair market value from the Amended and Restated 1997 Stock Option and Incentive
Plan in addition to the 7,500 options granted under the 1999 Director Plan.
INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee is responsible for determining salaries,
incentives and other forms of compensation for directors, officers and other
employees of SERENA and administering various incentive compensation and benefit
plans. The Compensation Committee consists of Alan H. Hunt and Jerry T.
Ungerman. Richard A. Doerr, formerly President, Chief Executive Officer and a
director of SERENA, had participated in all discussions and decisions regarding
salaries and incentive compensation for all employees and consultants of SERENA,
except that he was excluded from discussions regarding his own salary and
incentive compensation. The Company's newly appointed President and Chief
Executive Officer, Mark E. Woodward, will assume this role in the future. No
interlocking relationship exists between any member of SERENA's Compensation
Committee and any member of any other company's board of directors or
compensation committee.
5
<PAGE>
PROPOSAL TWO
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The board of directors has selected KPMG LLP, independent accountants, to
audit the financial statements of SERENA for the current fiscal year ending
January 31, 2001. SERENA expects that a representative of KPMG LLP will be
present at the Annual Meeting, will have the opportunity to make a statement if
he or she desires to do so, and will be available to answer any appropriate
questions.
VOTE REQUIRED AND BOARD OF DIRECTORS' RECOMMENDATION
The affirmative vote of the holders of a majority of the shares of Company
stock present or represented and voting at the Annual Meeting will be required
to approve this proposal. An abstention or nonvote is not an affirmative vote
and, therefore, will have the same effect as a vote against the proposal. The
board of directors has unanimously approved this proposal and recommends that
stockholders vote FOR the ratification of the selection of KPMG LLP.
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information regarding the beneficial
ownership of SERENA's Common Stock as of April 30, 2000 by (i) each person or
entity who is known by SERENA to own beneficially 5% or more of SERENA's
outstanding common stock; (ii) each director of SERENA; (iii) SERENA's Chief
Executive Officer and each of SERENA's four most highly compensated executive
officers who were serving as executive officers of SERENA as of January 31, 2000
(the "Named Executive Officers"); and (iv) all directors and executive officers
of SERENA as a group.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED
---------------------
NAME AND ADDRESS NUMBER PERCENT
- - - - - - - ---------------- ---------- --------
<S> <C> <C>
Douglas D. Troxel(1)..................................... 20,526,187 52.1%
Richard A. Doerr(2)...................................... 2,226,375 5.7%
Robert I. Pender, Jr.(3)................................. 367,853 *
Mark E. Woodward(4)...................................... 280,027 *
Anthony G. Stayner(5).................................... 273,294 *
Alan H. Hunt(6).......................................... 86,718 *
Jerry T. Ungerman(7)..................................... 14,062 *
All directors and executive officers as a group(8)
persons................................................ 23,997,245 61.0%
</TABLE>
- - - - - - - ------------------------
* Less than 1%.
(1) Includes 18,387,000 shares of common stock held by Mr. Troxel as trustee of
the Troxel Living Trust and 2,025,000 shares of common stock held by
Mr. Troxel as a general partner for Troxel Investments, L.P. Mr. Troxel is
SERENA's founder, Chief Technology Officer and Chairman of the board of
directors.
(2) Includes 2,226,375 shares of common stock subject to restricted stock
purchase agreements, of which 337,500 shares are subject to SERENA's
repurchase option as of April 30, 2000. Mr. Doerr was formerly SERENA's
President and Chief Executive Officer and is a continuing member of the
board of directors.
(3) Includes 353,250 shares of common stock subject to restricted stock purchase
agreements, of which 230,063 shares are subject to SERENA's repurchase
option as of April 30, 2000 should Mr. Pender's employment with SERENA
terminate. Includes 11,719 shares subject to stock options held by
Mr. Pender that are exercisable within 60 days of April 30, 2000.
Mr. Pender is SERENA's Vice President, Finance and Administration, Chief
Financial Officer and Secretary.
6
<PAGE>
(4) Includes 268,660 shares of common stock subject to restricted stock purchase
agreements, of which 211,635 shares are subject to SERENA's repurchase
option as of April 30, 2000 should Mr. Woodward's employment with SERENA
terminate. Includes 8,482 shares subject to stock options held by
Mr. Woodward that are exercisable within 60 days of April 30, 2000.
Mr. Woodward is SERENA's newly appointed President and Chief Executive
Officer.
(5) Includes 264,294 shares of common stock subject to restricted stock purchase
agreements, of which 173,278 shares are subject to SERENA's repurchase
option as of April 30, 2000 should Mr. Stayner's employment with SERENA
terminate. Includes 6,697 shares subject to stock options held by
Mr. Stayner that are exercisable within 60 days of April 30, 2000.
Mr. Stayner is SERENA's Vice President of Marketing. Mr. Stayner's shares
are held in Living Trust.
(6) Includes 84,375 shares of common stock subject to a restricted stock
purchase agreement, of which 40,431 shares are subject to SERENA's
repurchase option as of April 30, 2000 should Mr. Hunt's membership on
SERENA's board of directors terminate. Includes 2,343 shares subject to
stock options held by Mr. Hunt that are exercisable within 60 days of
April 30, 2000. Mr. Hunt is a member of SERENA's board of directors.
(7) Includes 14,062 shares subject to stock options held by Mr. Ungerman that
are exercisable within 60 days of April 30, 2000. Mr. Ungerman became a
member of SERENA's board of directors in December 1998.
7
<PAGE>
EXECUTIVE COMPENSATION
The table below and footnotes thereto set forth in summary form information
concerning the compensation awarded to, earned by, or paid for services rendered
to SERENA in all capacities during the fiscal years ended January 31, 1998, 1999
and 2000 by our President and Chief Executive Officer and our next four most
highly compensated executive officers whose salary and bonus for fiscal 2000
exceeded $100,000. Other than the salary and bonus described in the table below,
we did not pay any executive officer named in the Summary Compensation Table any
fringe benefits, perquisites or other compensation in excess of 10% of such
executive officer's salary and bonus during fiscal 2000. Bonus and commission
figures for all fiscal years presented represent bonuses and commissions earned
and paid in the fiscal year as well as bonuses and commissions earned in the
fiscal year but paid in the following fiscal year.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM ALL OTHER COMPENSATION
COMPENSATION AWARDS ------------------------------------
------------------------ GROUP
ANNUAL COMPENSATION RESTRICTED SECURITIES MATCHING LIFE
NAME AND PRINCIPAL FISCAL --------------------- STOCK UNDERLYING 401(K) INSURANCE
POSITION YEAR SALARY BONUS AWARDS($) OPTIONS(#) CONTRIBUTIONS PREMIUMS MISC.
- - - - - - - ------------------ -------- -------- ---------- ---------- ----------- ------------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Richard A. Doerr....... 2000 $225,000 $ 630,000 -- -- $6,400 $2,478 --
President and Chief 1999 200,000 379,200 -- -- 6,400 2,400 --
Executive Officer 1998 156,154(2) 429,620 1,334,250 -- 1,333 1,013 --
Douglas D. Troxel...... 2000 324,000 310,000 -- -- 5,870 1,614 23,907(1)
Chief Technology 1999 324,000 179,000 -- -- 5,940 1,536 24,175(1)
Officer 1998 324,000 1,063,500 -- -- 5,190 1,578 24,851(1)
Robert I. Pender,
Jr................... 2000 165,000 280,000 -- 37,500 6,400 450 --
Vice President,
Finance 1999 150,000 159,600 -- -- 6,400 383 --
and Administration, 1998 25,000(2) 15,000 184,500 -- 500 34 --
Chief Financial
Officer
and Secretary
Mark E. Woodward....... 2000 175,080 230,660 -- -- 2,305 486 --
Vice President of 1999 37,934(2) -- -- 258,749 533 41 --
Worldwide Operations
Anthony G. Stayner..... 2000 167,931 82,500 -- -- 5,337 437 --
Vice President of 1999 105,504(2) 6,522 -- 299,249 992 36 --
Marketing
</TABLE>
- - - - - - - ------------------------------
(1) Fiscal 2000 amounts include $18,950 in personal life insurance premiums and
$4,957 in personal car expenses paid by SERENA; fiscal 1999 amounts include
$18,950 in personal life insurance premiums, $906 in legal fees related to
estate planning and $4,319 in personal car expenses paid by SERENA; fiscal
1998 amounts include $18,950 in personal life insurance premiums and $5,901
in personal car expenses paid by SERENA.
(2) Represents salary earned and paid in the fiscal year when the executive was
not employed by SERENA for the entire fiscal year.
OPTION GRANTS DURING LAST FISCAL YEAR
The following table sets forth certain information with respect to stock
options granted to each of the Named Executive Officers during fiscal 2000,
including the potential realizable value over the 10 year term of the options
based on assumed rates of stock appreciation of 5% and 10%, compounded annually.
These assumed rates of appreciation comply with the rules of the Securities and
Exchange Commission and do not represent SERENA's estimate of future stock
price. Actual gains, if any, on stock option exercises will be dependent on the
future performance of SERENA common stock. In fiscal 2000, SERENA granted
options to acquire up to an aggregate of 576,000 shares to employees and
directors, all under the Amended and Restated 1997 Stock Option and Incentive
Plan and all at an exercise price equal to not less than the fair market value
of SERENA's common stock on the date of grant. Optionees may pay the exercise
price by cash, check, promissory note, delivery of already-owned shares of
SERENA's common stock or pursuant to a cashless exercise procedure. Options
under the Amended and Restated 1997 Stock Option and
8
<PAGE>
Incentive Plan vest over four years with 25% of the shares subject to option
vesting on the first anniversary of the grant date, and the remaining option
shares vesting ratably monthly thereafter.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
NUMBER OF PERCENTAGE OF ANNUAL RATES OF STOCK
SECURITIES TOTAL OPTIONS PRICE APPRECIATION
UNDERLYING GRANTED TO EXERCISE FOR OPTIONS TERM
OPTIONS EMPLOYEES IN PRICE PER EXPIRATION ---------------------
GRANTED FISCAL 2000 SHARE DATE 5% 10%
---------- ------------- --------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Richard A. Doerr............... -- --% $ -- -- $ -- $ --
Douglas D. Troxel.............. -- -- -- -- -- --
Mark E. Woodward............... -- -- -- -- -- --
Robert I. Pender, Jr........... 37,500 6.5% $9.291 3/10/09 $219,115 $555,280
Anthony G. Stayner............. -- -- -- -- -- --
</TABLE>
AGGREGATE OPTION EXERCISES DURING THE LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth certain information regarding stock options
held as of January 31, 2000 by the Named Executive Officers. The "Value of
Unexercised In-the-Money Options at January 31, 2000" is based upon the fair
market value on January 31, 2000 of $17.583 per share, minus the per share
exercise price, multiplied by the number of shares underlying the option. The
Named Executive Officers all own restricted shares of SERENA common stock under
the Amended and Restated 1997 Stock Option and Incentive Plan and those shares
are not included in this table. See "Employment Agreement and Change in Control
Arrangements."
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS AT
JANUARY 31, 2000 JANUARY 31, 2000
SHARES ACQUIRED VALUE --------------------------- ---------------------------
ON EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
--------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Richard A. Doerr....... -- -- -- -- -- --
Douglas D. Troxel...... -- -- -- -- -- --
Mark E. Woodward....... -- -- 40,859 99,230 $527,735 $1,281,665
Robert I. Pender,
Jr................... -- -- -- 37,500 -- $ 310,950
Anthony G. Stayner..... 15,640(1) $40,017 37,579 69,377 $517,561 $ 963,908
</TABLE>
- - - - - - - ------------------------
(1) Includes 5,540 shares subject to repurchase as of January 31, 2000.
EMPLOYMENT AGREEMENTS AND CHANGE IN CONTROL ARRANGEMENTS
On April 21, 1997, SERENA entered into an at-will employment agreement with
Richard A. Doerr, our former President, Chief Executive Officer and a member of
SERENA's board of directors. The employment agreement provided for Mr. Doerr to
receive an annual base salary of $200,000, subject to annual review for
increases, and an annual cash bonus based on the achievement of individual and
company performance objectives. In the event Mr. Doerr is terminated without
cause, Mr. Doerr will be entitled to receive severance payments equal to six
month's base salary. Pursuant to the employment agreement, in January 1998,
Mr. Doerr and SERENA entered into a restricted stock purchase agreement under
which Mr. Doerr purchased 2,001,375 shares of SERENA's common stock under the
1997 Plan at a purchase price of $0.67 per share. Mr. Doerr paid the purchase
price for his restricted shares in the form of a full recourse promissory note
secured by the purchased common stock. The promissory note bears interest at an
annual rate of 5.9%. Mr. Doerr resigned as President and CEO on May 2, 2000.
9
<PAGE>
SERENA and Douglas D. Troxel, SERENA's founder, Chief Technology Officer and
the Chairman of the board of directors, are parties to an employment agreement
that automatically renews each June unless Mr. Troxel is terminated for cause.
In January 1998, Robert I. Pender, Jr., our Vice President, Finance and
Administration, Chief Financial Officer and Secretary, purchased 276,750 shares
of common stock at a purchase price of $0.67 per share under a restricted stock
purchase agreement. In August 1999 and various times during the fourth quarter
of fiscal 1999, Anthony G. Stayner, our Vice President of Marketing, early
exercised stock options in exchange for the purchase of 192,293 shares of common
stock at purchase prices of $3.11 and $4.67 per share under restricted stock
purchase agreements. In November 1998, Mark E. Woodward, our newly appointed
President and Chief Executive Officer, early exercised stock options in exchange
for the purchase of 118,660 shares of common stock at a purchase price of $4.67
per share under a restricted stock purchase agreement. Each individual paid the
purchase price for his shares in the form of full recourse promissory notes
secured by the purchased common stock. These promissory notes bear interest at
the annual rate of 5.9%. SERENA holds repurchase options on unvested shares
should the individual executive officers terminate their relationship with
SERENA. These repurchase rights lapse with respect to one quarter of the shares
subject to the agreements on the first anniversary of their hire date or grant
date with repurchase rights on the remaining unvested shares lapsing ratably on
a monthly basis over the succeeding three years.
The Amended and Restated 1997 Stock Option and Incentive Plan provides that
in the event of a merger or consolidation of SERENA with or into another
corporation, a sale of substantially all of SERENA's assets or certain other
changes in control of SERENA, the right of SERENA to repurchase shares purchased
pursuant to a restricted stock purchase agreement lapses. Additionally, in any
of the events noted in the preceding sentence, the holders of stock options
awarded under the Amended and Restated 1997 Stock Option and Incentive Plan
shall have the right to exercise all of the shares of stock covered under the
applicable option agreement, including shares which would not otherwise be
exercisable.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
NOTWITHSTANDING ANY STATEMENT TO THE CONTRARY IN ANY OF SERENA'S PREVIOUS OR
FUTURE FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, THIS REPORT OF THE
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS SHALL NOT BE DEEMED "FILED"
WITH THE COMMISSION AND SHALL NOT BE INCORPORATED BY REFERENCE INTO ANY SUCH
FILINGS.
The Compensation Committee of the board of directors (the "Committee")
establishes the general compensation policies of SERENA and the compensation
plans and the specific compensation levels for senior executives, including
SERENA's Chief Executive Officer.
GENERAL COMPENSATION PHILOSOPHY
The primary objectives of SERENA's executive compensation policies include
the following:
- To attract, motivate, and retain a highly qualified executive management
team;
- To link executive compensation to SERENA's financial performance as well
as to define individual management objectives established by the
Committee;
- To compensate competitively with the practices of similarly situated
technology companies; and
- To create management incentives designed to enhance stockholder value.
SERENA competes in an aggressive and dynamic industry and, as a result,
believes that finding, motivating, and retaining quality employees, particularly
senior managers, sales personnel, and technical personnel, are key factors to
SERENA's future success. The Committee's compensation philosophy seeks
10
<PAGE>
to align the interests of stockholders and management by tying compensation to
SERENA's financial performance, either directly in the form of salary and
bonuses paid in cash or indirectly in the form of appreciation of stock options
granted to employees through SERENA's equity incentive programs.
CASH COMPENSATION
SERENA seeks to provide cash compensation to its executive officers,
including base salary and an annual cash bonus, at levels that are commensurate
with cash compensation paid at similarly-situated technology companies. Annual
increases in base salary are determined on an individual basis based on market
data and a review of the officer's performance and contribution to various
individual, departmental, and corporate objectives. Cash bonuses are intended to
provide additional incentives to achieve such objectives.
The fiscal 2000 salaries and cash bonuses of each of the executive officers
of SERENA, other than the Chief Executive Officer, were determined by the board
of directors, upon the recommendation of the Chief Executive Officer. The Chief
Executive Officer's base salary was determined by the board of directors. In
addition, cash bonuses for SERENA's President and Chief Executive Officer, Chief
Technology Officer and Chief Financial Officer were allocated from a bonus pool
established by the board of directors based on overall SERENA earnings. Cash
bonuses were also earned by operational vice presidents based on their
divisional financial performance and the overall financial performance of
SERENA.
Based on a review of proxy data and other relevant market data, the
Compensation Committee believes that cash compensation paid to SERENA's
executive officers, including the Chief Executive Officer, was generally
consistent with amounts paid to officers with similar responsibilities at
similarly-situated software companies.
EQUITY-BASED COMPENSATION
STOCK OPTIONS. Stock options are periodically granted to provide additional
incentive to executives and other employees to maximize long-term total return
to SERENA's stockholders. Stock options are a particularly strong incentive
because they are valuable to employees only if the fair market value of SERENA's
common stock increases above the exercise price, which is set at the fair market
value of SERENA common stock on the date the option is granted. In addition,
employees must remain employed with SERENA for a fixed period of time in order
for the options to vest fully. Options generally vest over a four year period to
encourage option holders to continue in the employ of SERENA.
All of the restricted stock purchases and stock options granted in the year
ended January 31, 2000 were approved by the full board of directors. Future
option grants to executive officers will be determined by the Compensation
Committee or the full board of directors. In making its determination, the
Compensation Committee intends to consider the executive's position at SERENA,
such executive's individual performance, the number of options held (if any) and
the extent to which such options are vested, and any other factors that the
Compensation Committee may deem relevant.
11
<PAGE>
TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION
Section 162 of the Code limits the federal income tax deductibility of
compensation paid to SERENA's Chief Executive Officer and to each of the other
four most highly-compensated executive officers. SERENA may deduct such
compensation only to the extent that during any fiscal year the compensation
paid to such individual does not exceed $1 million or meet certain specified
conditions (including stockholder approval). Based on SERENA's current
compensation plans and policies and proposed regulations interpreting this
provision of the Code, SERENA and the Committee believe that, for the near
future, there is little risk that SERENA will lose any significant tax deduction
for executive compensation.
THE COMPENSATION COMMITTEE
Alan H. Hunt
Jerry T. Ungerman
12
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
SERENA's officers and directors and persons who own more than 10% of a
registered class of SERENA's equity securities to file reports of ownership on
Form 3 and changes in ownership on Forms 4 or 5 with the Securities and Exchange
Commission. Such officers, directors, and 10% stockholders are also required by
applicable rules to furnish SERENA with copies of all Section 16(a) reports they
file.
To the company's knowledge, based solely upon review of the copies of such
reports furnished to SERENA during the fiscal year ended January 31, 2000, no
director, officer or beneficial holder of more than 10% of any class of equity
securities of the Company failed to file on a timely basis reports required by
Section 16(a) of the Securities Exchange Act of 1934 during the most recent
fiscal year.
CERTAIN TRANSACTIONS
In July 1998, SERENA made a loan to Mr. Troxel in the principal amount of
$600,000. The loan was secured by shares of SERENA common stock held by
Mr. Troxel. The loan accrued interest at the rate of 5.56% per year. All
outstanding principal and accrued interest were paid in full by March 1999.
In connection with his appointment to our board of directors, Alan H. Hunt
entered into a restricted stock purchase agreement with SERENA in April 1998 to
purchase 84,375 shares of common stock at a per share purchase price of $0.96.
Mr. Hunt paid the purchase price of $81,000 for these shares in the form of a
full recourse promissory note secured by the purchased common stock. The
promissory note bears interest at an annual rate of 5.9%. SERENA holds a
repurchase option on any unvested shares that become exercisable in the event
Mr. Hunt ceases to be a member of our board of directors. The repurchase right
lapses with respect to one quarter of the shares on the first anniversary of the
purchase date and with respect to the remaining shares, ratably monthly
thereafter. In the event of a change in control transaction, SERENA's right to
repurchase the shares shall lapse.
13
<PAGE>
COMPANY PERFORMANCE
The following line graph compares the cumulative total return to
stockholders on SERENA's common stock since February 12, 1999. The graph
compares stockholder return on SERENA's common stock with the same cumulative
total return on the Hambrecht & Quist Growth Index and the Nasdaq Stock
Market--U.S. Index. The information contained in the Performance Graph shall not
be deemed to be "soliciting material" or to be "filed" with the Securities and
Exchange Commission, nor shall such information be incorporated by reference
into any future filing under the Securities Act of 1933 or the Securities
Exchange Act of 1934, except to the extent that SERENA specifically incorporates
it by reference into such filing.
The graph assumes that $100 was invested on February 12, 1999 in SERENA's
common stock, in the Hambrecht & Quist Growth Index and in the Nasdaq Stock
Market--U.S. Index and that all dividends were reinvested. No dividends have
been declared or paid on SERENA's common stock. Stockholder returns over the
period indicated should not be considered indicative of future stockholder
returns.
SERENA SOFTWARE, INC.
STOCK PRICE PERFORMANCE
[FEBRUARY 12, 1999 (INCEPTION) - JANUARY 31, 2000]
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
SERENA SOFTWARE NASDAQ COMPOSITE H&Q TECHNOLOGY INDEX
<S> <C> <C> <C>
2/12/99 $100.000 $100.000 $100.000
3/31/99 $92.562 $106.008 $104.846
4/30/99 $67.768 $109.514 $108.796
5/28/99 $86.780 $106.400 $110.281
6/30/99 $88.843 $115.685 $124.142
7/30/99 $66.944 $113.631 $122.423
8/31/99 $92.978 $117.977 $128.280
9/30/99 $113.230 $118.270 $131.190
10/29/99 $123.971 $127.757 $144.951
11/30/99 $157.443 $143.680 $169.433
12/31/99 $204.552 $175.257 $214.685
1/31/00 $174.383 $169.702 $205.390
</TABLE>
SERENA SOFTWARE, INC.
2000 STOCK PERFORMANCE ANALYSIS
<TABLE>
<CAPTION>
NASDAQ H&Q TECHNOLOGY
SERENA SOFTWARE COMPOSITE INDEX
------------------------ ------------------------ ------------------------
DATE CLOSING PRICE BALANCE CLOSING PRICE BALANCE CLOSING PRICE BALANCE
- - - - - - - ---- ------------- -------- ------------- -------- ------------- --------
<S> <C> <C> <C> <C> <C> <C>
2/12/99.................................... 10.083 100.000 2321.9 100.000 1,879.46 100.000
3/31/99.................................... 9.333 92.562 2461.4 106.008 1,970.53 104.846
4/30/99.................................... 6.833 67.768 2542.8 109.514 2,044.77 108.796
5/28/99.................................... 8.75 86.780 2470.5 106.400 2,072.68 110.281
6/30/99.................................... 8.958 88.843 2686.1 115.685 2,333.20 124.142
7/30/99.................................... 6.75 66.944 2638.4 113.631 2,300.89 122.423
8/31/99.................................... 9.375 92.978 2739.3 117.977 2,410.97 128.280
9/30/99.................................... 11.333 112.397 2746.1 118.270 2,465.66 131.190
10/29/99................................... 12.5 123.971 2966.4 127.757 2,724.30 144.951
11/30/99................................... 15.875 157.443 3336.1 143.680 3,184.42 169.433
12/31/99................................... 20.625 204.552 4069.3 175.257 4,034.92 214.685
1/31/00.................................... 17.583 174.383 3940.3 169.702 3,860.23 205.390
</TABLE>
14
<PAGE>
OTHER MATTERS
SERENA knows of no other matters to be submitted at the Annual Meeting. If
any other matters properly come before the Annual Meeting, it is the intention
of the persons named in the enclosed proxy card to vote the shares they
represent as the board of directors may recommend.
It is important that your shares be represented at the Annual Meeting,
regardless of the number of shares which you hold. You are, therefore, urged to
mark, sign, date, and return the accompanying proxy card as promptly as possible
in the postage-prepaid envelope enclosed for that purpose.
For the Board of Directors
SERENA SOFTWARE, INC.
[/S/ ROBERT I. PENDER, JR.]
Robert I. Pender, Jr.
SECRETARY
Dated: May 29, 2000
15
<PAGE>
- - - - - - - -------------------------------------------------------------------------------
PROXY SERENA SOFTWARE, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Mark E. Woodward and Robert I. Pender,
Jr., and either of them, as attorneys of the undersigned with full power of
substitution, to vote all shares of stock which the undersigned is entitled
to vote at the Annual Meeting of Stockholders of SERENA Software, Inc., to be
held at SERENA's principal executive offices at 500 Airport Boulevard, 2nd
Floor, Burlingame, California, on June 30, 2000 at 2:00 p.m., local time, and
at any continuation or adjournment thereof, with all the powers which the
undersigned might have if personally present at the meeting.
The undersigned hereby acknowledges receipt of the Notice of Annual
Meeting and Proxy Statement, dated May 29, 2000, and hereby expressly revokes
any and all proxies heretofore given or executed by the undersigned with
respect to the shares of stock represented by this Proxy and by filing this
Proxy with the Secretary of the Corporation, gives notice of such revocation.
THIS PROXY MAY BE REVOKED AT ANY TIME PRIOR TO THE TIME IT IS VOTED.
PLEASE COMPLETE, DATE AND SIGN THIS PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED ENVELOPE.
SEE REVERSE CONTINUED AND TO BE SIGNED ON SEE REVERSE
SIDE REVERSE SIDE SIDE
- - - - - - - -------------------------------------------------------------------------------
FOLD AND DETACH HERE
- - - - - - - -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PLEASE
MARK VOTES /X/
AS IN THIS
EXAMPLE
<S> <C> <C> <C>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE
"FOR" THE FOLLOWING:
1. ELECTION OF DIRECTORS NOMINEE: Douglas D. Troxel FOR WITHHELD
/ / / /
NOMINEE: Richard A. Doerr FOR WITHHELD
/ / / /
NOMINEE: Alan H. Hunt FOR WITHHELD
/ / / /
NOMINEE: Jerry T. Ungerman FOR WITHHELD
/ / / /
NOMINEE: Mark E. Woodward FOR WITHHELD
/ / / /
NOMINEE: Robert I. Pender, Jr. FOR WITHHELD
/ / / /
</TABLE>
<PAGE>
2. To ratify the appointment of KPMG LLP as the Corporation's independent
accountants for the 2001 fiscal year
FOR AGAINST ABSTAIN
/ / / / / /
In their discretion, the proxies are authorized to vote upon such other
matter(s) which may properly come before the meeting and any
adjournment(s) thereof.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT / /
THIS PROXY WILL BE VOTED AS DIRECTED, OR, IF NO DIRECTION IS INDICATED, WILL
BE VOTED FOR THE LISTED NOMINEES IN THE ELECTION OF DIRECTORS AND FOR THE
RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS INDEPENDENT ACCOUNTANTS FOR
THE 2001 FISCAL YEAR.
Please date and sign exactly as your name or names appear hereon. Corporate
or partnership proxies should be signed in full corporate or partnership name
by an authorized person. Persons signing in a fiduciary capacity should
indicate their full titles in such capacity. If shares are held by joint
tenants or as community property, both should sign.
Signature: Date:
------------------------------------------- ----------------
Signature: Date:
------------------------------------------- ----------------
- - - - - - - -------------------------------------------------------------------------------
FOLD AND DETACH HERE
