<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
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 Rule 14a-11(c) or Rule 14a-12
INFORMATICA 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):
<TABLE>
<S> <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 transactions
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:
------------------------------------------------------------
</TABLE>
<PAGE> 2
Informatica Logo
INFORMATICA CORPORATION
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 25, 2000
To the Stockholders of Informatica Corporation:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
Informatica Corporation, a Delaware corporation (the "Company"), will be held at
the Company's corporate offices located at 3350 W. Bayshore Road, Palo Alto,
California 94303, at 3:00 p.m., Pacific Time, on May 25, 2000, for the following
purposes:
1. ELECTION OF DIRECTORS. To elect one Class I director for a term
ending in 2001, two Class II directors for terms ending in 2002, and two
Class III directors for terms ending in 2003 or until their successors are
elected and qualified.
2. APPROVAL OF AN AMENDMENT TO THE COMPANY'S AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION. To approve an amendment to the Company's
Amended and Restated Certificate of Incorporation to increase the number of
shares of Common Stock which the Company is authorized to issue from
100,000,000 shares to 200,000,000 shares.
3. RATIFICATION AND APPROVAL OF THE APPOINTMENT OF INDEPENDENT
AUDITORS. To ratify and approve the appointment of Ernst & Young LLP as the
independent auditors for the Company for the fiscal year ending December
31, 2000.
4. OTHER BUSINESS. To transact such other business as may properly
come before the Annual Meeting of Stockholders and any adjournment or
postponement thereof.
The foregoing items of business are more fully described in the Proxy
Statement which is attached hereto and made a part hereof.
The Board of Directors has fixed the close of business on March 16, 2000 as
the record date for determining the stockholders entitled to notice of and to
vote at the 2000 Annual Meeting of Stockholders and any adjournment or
postponement thereof.
By Order of the Board of Directors,
/s/ Gaurav S. Dhillon
Gaurav S. Dhillon
Chief Executive Officer, Secretary and
Director
Palo Alto, California
April 21, 2000
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING OF STOCKHOLDERS
IN PERSON, YOU ARE URGED TO MARK, SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD
AS PROMPTLY AS POSSIBLE IN THE POSTAGE-PREPAID ENVELOPE PROVIDED TO ENSURE YOUR
REPRESENTATION AND THE PRESENCE OF A QUORUM AT THE ANNUAL MEETING. IF YOU SEND
IN YOUR PROXY CARD AND THEN DECIDE TO ATTEND THE ANNUAL MEETING TO VOTE YOUR
SHARES IN PERSON, YOU MAY STILL DO SO. YOUR PROXY IS REVOCABLE IN ACCORDANCE
WITH THE PROCEDURES SET FORTH IN THE PROXY STATEMENT.
<PAGE> 3
INFORMATICA CORPORATION
3350 W. BAYSHORE BOULEVARD
PALO ALTO, CALIFORNIA 94303
------------------------
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement is furnished to the stockholders of Informatica
Corporation, a Delaware corporation (the "Company"), in connection with the
solicitation by the Board of Directors of the Company (the "Board" or "Board of
Directors") of proxies in the accompanying form for use in voting at the 2000
Annual Meeting of Stockholders of the Company (the "Annual Meeting") to be held
on May 25, 2000 at the Company's corporate offices located at 3350 W. Bayshore
Road, Palo Alto, California 94303, at 3:00 p.m., Pacific Time, and any
adjournment or postponement thereof. The shares represented by the proxies
received, properly marked, dated, executed and not revoked will be voted at the
Annual Meeting. Unless otherwise indicated, all Common Stock numbers in this
Proxy Statement have been adjusted to reflect the effect of the one-for-one
stock dividend declared by the Company payable March 6, 2000.
REVOCABILITY OF PROXIES
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before it is exercised by delivering to the Company (to
the attention of Gaurav S. Dhillon, the Company's Secretary) a written notice of
revocation or a duly executed proxy bearing a later date, or by attending the
Annual Meeting and voting in person.
SOLICITATION AND VOTING PROCEDURES
This Proxy Statement and the accompany proxy were first sent by mail to
stockholders on or about April 21, 2000. The solicitation of proxies will be
conducted by mail, and the Company will bear all attendant costs. These costs
will include the expense of preparing and mailing proxy materials for the Annual
Meeting and reimbursements paid to brokerage firms and others for their expenses
incurred in forwarding solicitation material regarding the Annual Meeting to
beneficial owners of the Company's Common Stock. The Company may conduct further
solicitation personally, by telephone or by facsimile through its officers,
directors and regular employees, none of whom will receive additional
compensation for assisting with such solicitation.
The close of business on March 16, 2000 has been fixed as the record date
(the "Record Date") for determining the holders of shares of Common Stock of the
Company entitled to notice of and to vote at the Annual Meeting. As of the close
of business on the Record Date, the Company had approximately 33,073,001 shares
of Common Stock outstanding and entitled to vote at the Annual Meeting. Each
outstanding share of Common Stock on the Record Date is entitled to one vote on
all matters.
A majority of the shares entitled to vote, present in person or represented
by proxy, shall constitute a quorum at the Annual Meeting. For the election of
directors, the candidates receiving the greatest number of affirmative votes are
elected, provided a quorum is present and voting. Proposal No. 2 will require
the affirmative vote of a majority of the shares of the Company's outstanding
Common Stock. The affirmative vote of a majority of the outstanding shares of
the Company's Common Stock present in person or represented by proxy at the
Annual Meeting shall be required to approve Proposal No. 3 being submitted to
the stockholders for their consideration.
Under the General Corporation Law of the State of Delaware, an abstaining
vote and a broker "non-vote" are counted as present and are, therefore, included
for purposes of determining whether a quorum of shares is present at a meeting.
However, broker "non-votes" are not deemed to be "votes entitled to vote." As a
result, broker "non-votes" are not included in the tabulation of the voting
results on the election of directors or issues requiring approval of a majority
of the votes entitled to vote and, therefore, do not have the effect of votes in
opposition in such tabulations. A broker "non-vote" occurs when a nominee
holding shares for a
<PAGE> 4
beneficial owner does not vote on a particular proposal because the nominee does
not have the discretionary voting power with respect to that item and has not
received instructions from the beneficial owner. Because abstentions will be
included in tabulations of the votes entitled to vote for purposes of
determining whether a proposal has been approved, abstentions have the same
effect as negative votes. Broker non-votes and shares as to which proxy
authority has been withheld with respect to any matter are not deemed to be
entitled to vote for purposes of determining whether stockholder approval of a
matter has been obtained and effectively count as votes against Proposal No. 2.
However, with respect to Proposal No. 3 requiring the affirmative vote of a
majority of the shares present and entitled to vote, broker non-votes shall have
no effect.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
In connection with Company's initial public offering of its Common Stock in
April 1999, the Company's Amended and Restated Certificate of Incorporation was
amended to provide that the Board of Directors, currently set a six directors,
will be divided into three classes of directors with each class serving a
staggered three-year term. Effective June 15, 1999, Arnold N. Silverman resigned
as a member of the Board and will not seek re-election thereby leaving one
vacancy on the Board. The Board of Directors has nominated the following five
individuals to serve as directors until the term of each director class has
expired and their respective successors are elected: David W. Pidwell and Gaurav
S. Dhillon as Class III directors for three year terms expiring in 2003, A.
Brooke Seawell and Diaz H. Nesamoney as Class II directors for two year terms
expiring in 2002, and Vincent R. Worms as a Class I director for a one year term
expiring in 2001. Each of the nominees has consented, if elected as a director
of the Company, to serve until his term expires. In the event that any nominee
of the Company is unable or declines to serve as a director at the time of the
Annual Meeting, the proxies will be voted for any nominee who shall be
designated by the present Board of Directors to fill the vacancy. In the event
that additional persons are nominated for election as directors, the proxy
holders intend to vote all proxies received by them in such a manner as will
assure the election of as many of the nominees listed below as possible, and, in
such event, the specific nominees to be voted for will be determined by the
proxy holders. The Board has no reason to believe that the persons named below
will be unable or unwilling to serve as a director, if elected. Each of the five
nominees for director who receives the greatest number of votes will be elected.
Set forth below are the names, ages and certain biographical information
relating to the director nominees.
<TABLE>
<CAPTION>
DIRECTOR
NAME OF NOMINEE CLASS AGE POSITION WITH COMPANY SINCE
--------------- ----- --- --------------------- --------
<S> <C> <C> <C> <C>
Gaurav S. Dhillon.................... III 34 Chief Executive Officer, Secretary 1993
and Director
Diaz H. Nesamoney.................... II 35 Chief Operating Officer, President 1993
and Director
David W. Pidwell(2).................. III 52 Director 1996
A. Brooke Seawell(1)................. II 52 Director 1997
Vincent R. Worms(1).................. I 47 Director 1995
</TABLE>
- ---------------
(1) Member of Audit Committee
(2) Member of Compensation Committee
MR. DHILLON is a co-founder of the Company and has been its Chief Executive
Officer, Secretary and a member of the Board of Directors since the Company's
inception in February 1993. Prior to co-founding the Company, Mr. Dhillon was
employed by Sterling Software, a software company, from December 1991 to
November 1992, where his last position was project manager. Prior to that, he
was a Systems Architect with Unisys Corporation. Mr. Dhillon holds a B.S.E.E.
from Punjab University, India.
MR. NESAMONEY is a co-founder of the Company and has been a member of the
Board of Directors and President since the Company's inception in February 1993.
Mr. Nesamoney assumed the additional role of
2
<PAGE> 5
Chief Operating Officer in February 2000. Prior to co-founding the Company, Mr.
Nesamoney was employed by Unisys Corporation from May 1988 to February 1993,
where his last position was Development Manager. Mr. Nesamoney holds an M.S.C.S.
degree from Birla Institute of Technology & Science.
MR. PIDWELL has been a Director of the Company since February 1996. From
January 1988 to January 1996, Mr. Pidwell was president and chief executive
officer of Rasna Corporation, a software company. Mr. Pidwell is currently a
venture partner with Asset Management Associates and serves on the boards of
directors of a number of private companies. Mr. Pidwell holds a B.S.E.E. in
electrical engineering and a M.S.I.S.E. degree in computer systems engineering
from Ohio University.
MR. SEAWELL has been a Director of the Company since December 1997. From
January 1997 to August 1998, Mr. Seawell was executive vice president of
NetDynamics, an internet applications server company. From March 1991 to January
1997, Mr. Seawell was senior vice president and chief financial officer of
Synopsys. Mr. Seawell holds a B.A. degree in Economics and an M.B.A. degree in
Finance and Accounting from Stanford University . Mr. Seawell serves on the
board of directors of NVIDIA Corporation, a 3D (three-dimensional) graphics
processor company, and several privately held companies.
MR. WORMS has been a Director of the Company since September 1995. From
1982 to the present, Mr. Worms has served as co-president of Partech
International Capital Management, a venture capital firm that manages one of the
Company's investors. Mr. Worms holds a M.S. degree in science from the Ecole
Polytechnique in Paris, France and the Massachusetts Institute of Technology.
Mr. Worms serves on the boards of directors of SangStat Medical Corporation and
Business Objects, a software company, in addition to serving on the board of a
number of private companies.
An automated system administered by the Company's transfer agent will
tabulate votes cast by proxy at the Annual Meeting and an officer of the Company
will tabulate votes cast in person at the Annual Meeting.
THE BOARD RECOMMENDS A VOTE FOR
THE ELECTION OF THE NOMINEES NAMED ABOVE
RELATIONSHIPS AMONG DIRECTORS OR EXECUTIVE OFFICERS
There are no family relationships among any of the directors or executive
officers of the Company.
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
During the fiscal year ended December 31, 1999, the Board met seven times.
The Board has two committees: the Audit Committee and the Compensation
Committee. During the fiscal year ended December 31, 1999, no director attended
fewer than 75% of all the meetings of the Board and its committees on which he
served after becoming a member of the Board.
The Audit Committee, which held two meetings in the fiscal year ended
December 31, 1999, consists of Mr. Seawell and Mr. Worms. The Audit Committee is
primarily responsible for approving the services performed by the Company's
independent auditors, for reviewing and evaluating the Company's accounting
principles and its systems of internal accounting controls, as well as other
matters which may come before it or as directed by the Board.
The Compensation Committee, which held nine meetings in the fiscal year
ended December 31, 1999, consisted of Mr. Pidwell and Mr. Silverman until his
resignation in June 1999. There is currently a vacancy on the Compensation
Committee which will be filled by the Board. The Compensation Committee reviews
and approves the compensation and benefits for the Company's executive officers,
administers the Company's 1999 Employee Stock Purchase Plan, 1999 Stock
Incentive Plan, 1999 Non-Employee Director Stock Incentive Plan and performs
such other duties as may from time to time be determined by the Board.
The Board does not have a nominating committee or a committee performing
the functions of a nominating committee. While there are no formal procedures
for stockholders to recommend nominations, the Board will consider stockholder
recommendations. Such recommendations should be addressed to Gaurav S. Dhillon,
the Company's Secretary, at the Company's principal executive offices.
3
<PAGE> 6
COMPENSATION OF DIRECTORS
The Company's 1999 Non-Employee Director Plan (the "1999 Director Plan")
provides for annual automatic grants of nonqualified stock options to continuing
non-employee directors. Under the 1999 Director Plan, each non-employee director
will receive a nonqualified stock option grant of 50,000 shares of the Company's
Common Stock upon his or her initial election to the Board of Directors. On the
date of each annual stockholders' meeting, each individual who is at the time
continuing to serve as a non-employee director will automatically be granted an
option to purchase 10,000 shares of the Company's Common Stock. All options
automatically granted to non-employee directors will have an exercise price
equal to 100% of the fair market value on the date of grant and become
exercisable in four equal annual installments. To date, no grants have been made
to non-employee directors under the 1999 Director Plan. However, following this
Annual Meeting, the Company's non-employee directors will each receive an option
grant of 10,000 shares as described above.
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock as of March 31, 2000 for (i)
each person who is known by the Company to beneficially own more than 5% of the
Company's Common Stock, (ii) each of the Company's directors, (iii) each of the
Named Executive Officers appearing in the Summary Compensation Table below and
(iv) all directors and executive officers as a group.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED(1)
------------------------
DIRECTORS, EXECUTIVE OFFICERS AND 5% STOCKHOLDERS NUMBER PERCENT(2)
------------------------------------------------- ---------- ----------
<S> <C> <C>
Putnam Investments Inc...................................... 4,170,334 12.6%
One Post Office Square
Boston, MA 02109(3)
Vincent R. Worms(6)......................................... 3,701,950 11.2%
Partech Entities............................................ 3,592,980 10.8%
50 California Street, Ste. 3200
San Francisco, CA 4111(4)
Pilgrim Baxter & Associates Ltd.
825 Duportail Road Wayne, PA 9087(5)...................... 3,012,200 9.1%
Diaz H. Nesamoney(7)........................................ 2,668,624 8.0%
Gaurav S. Dhillon(8)........................................ 2,664,292 7.9%
Clive A. Harrison (9)....................................... 372,416 1.1%
David W. Pidwell(10)........................................ 108,842 *
A. Brooke Seawell(11)....................................... 64,791 *
Craig L. Klosterman(12)..................................... 39,875 *
All executive officers and Directors as a group (9
persons)(13).............................................. 9,515,790 27.9%
</TABLE>
- ---------------
* Less than 1% of the outstanding common stock
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. In computing the number of shares
beneficially owned by a person and the percentage ownership of that person,
shares of Common Stock subject to options held by that person that are
currently exercisable or exercisable within 60 days of March 31, 2000 are
deemed outstanding. Such shares, however, are not deemed outstanding for
the purpose of computing the percentage ownership of each other person. To
the Company's knowledge, except as set forth in the footnotes to this table
and subject to applicable community property laws, each person named in the
table has sole voting and investment power with respect to the shares set
forth opposite such person's name.
4
<PAGE> 7
(2) Percentage beneficially owned is based on 33,188,712 shares of Common Stock
outstanding as of March 31, 2000.
(3) Based upon a Schedule 13G/A filed with the Securities and Exchange
Commission on February 17, 2000.
(4) Includes 1,219,760 shares held by Partech U.S. Partners III, C.V.,
1,219,758 shares held by Parvest U.S. Partners II, C.V. 107,918 shares held
by Vendome Capital LLC, 141,456 shares held by Multinvest LLC, 340,000
shares held by U.S. Growth Fund Partners, C.V., 213,332 shares held by Axa
U.S. Growth Fund, LLC, 56,312 shares held by Thomas G. McKinley, 248,624
shares held by Almanori Limited, 19,152 shares held by Partech
International Profit Sharing Plan, 13,334 shares held by Parallel Capital I
LLC, and 13,334 shares held by Parallel Capital II LLC. Mr. Worms, one of
the Company's directors, is either a general partner, managing member,
attorney-in-fact or trustee of each Partech Entity. Mr. Worms disclaims
beneficial ownership of such shares except to the extent of his pecuniary
interest therein.
(5) Based upon a Schedule 13G/A filed with the Securities and Exchange
Commission on January 7, 2000.
(6) Includes 3,592,980 shares held by the Partech Entities. Mr. Worms disclaims
beneficial ownership of such shares except to the extent of his pecuniary
interest therein.
(7) Includes 349,312 shares subject to options exercisable within 60 days of
March 31, 2000. Also includes 5,332 shares held by Mr. Nesamoney's spouse.
(8) Includes 349,312 shares subject to options exercisable within 60 days of
March 31 2000.
(9) Includes 76,168 shares subject to options exercisable within 60 days of
March 31, 2000.
(10) Includes 3,750 shares subject to options exercisable within 60 days of
March 31, 2000. Also includes 105,000 shares held of record by the Pidwell
Family Living Trust dated June 25, 1987, of which David Pidwell, a director
of the Company, is trustee.
(11) Includes 64,791 shares subject to options exercisable within 60 days of
March 31, 2000.
(12) Includes 39,875 shares subject to options exercisable within 60 days of
March 31, 2000.
(13) Includes 883,208 shares subject to options exercisable within 60 days of
March 31, 2000.
PROPOSAL NO. 2
AMENDMENT TO AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
The Board of Directors believes the current capital structure of the
Company does not provide sufficient flexibility for the potential future needs
of the Company. Therefore, the Board has unanimously approved an amendment to
the Company's Amended and Restated Certificate of Incorporation to increase the
number of authorized shares of the Company's Common Stock from 100,000,000
shares to 200,000,000 (the "Amendment"). No increase in the number of shares of
Preferred Stock of the Company, currently 2,000,000 shares, is proposed or
anticipated.
If approved by the stockholders, the Amendment will become effective upon
the filing of a Certificate of Amendment of Amended and Restated Certificate of
Incorporation with the Delaware Secretary of State. The Amendment would change
Article IV of the Company's Amended and Restated Certificate of Incorporation to
read in its entirety as follows:
ARTICLE IV
This Corporation is authorized to issue two classes of shares to be
designated, respectively, "Common Stock" with a par value of $0.001 per
share ("Common Stock"), and "Preferred Stock" with a par value of $0.001
per share ("Preferred Stock"). The total number of shares which the
Corporation is authorized to issue is Two Hundred Two Million (202,000,000)
shares, of which Two Hundred Million
5
<PAGE> 8
(200,000,000) shares shall be Common Stock and Two Million (2,000,000)
shares shall be Preferred Stock.
The Preferred Stock authorized by this Amended and Restated
Certificate of Incorporation may be issued from time to time in one or more
series. Subject to applicable protective voting rights which have been or
may be granted to the Preferred Stock, the Board of Directors is authorized
to determine or alter any or all of the rights, preferences, privileges and
restrictions granted to or imposed upon any wholly unissued series of
Preferred Stock, and to fix, alter or reduce the number of shares
comprising any such series (but not below the number of such shares
outstanding for any such series) and the designation thereof, or any of
them, and to provide for rights and terms of redemption or conversion of
the shares of any such series.
PURPOSE AND EFFECT OF THE AMENDMENT
The principal purpose of the proposed Amendment is to authorize additional
shares of Common Stock which will be available in the event that the Board of
Directors determines that it is necessary or appropriate, among other things, to
effect future stock dividends or stock splits, to raise additional capital
through the sale of securities, to acquire another company or its business or
assets through the issuance of securities, or to establish a strategic
relationship with a corporate partner through the exchange of securities.
As of the Record Date, of the Company's 100,000,000 authorized shares of
Common Stock, 33,073,001 shares were issued and outstanding, and 8,272,571
shares were subject to outstanding options granted pursuant to the Company's
current stock option plans and stock purchase plan (together, the "Plans").
If the proposed Amendment is adopted, the aggregate number of authorized
shares of Common Stock will be increased from 100,000,000 shares to 200,000,000
shares. If the Amendment were adopted, based on the balance of authorized shares
as of March 16, 2000, 58,654,428 shares would be available for future issuance
by the Board of Directors without any stockholder approval, subject to the
requirements of the Nasdaq Stock Market and the Delaware General Corporation
Law. The Board of Directors believes that the availability of such additional
shares will provide the Company with the flexibility to issue common stock for
the purposes stated above without further action by the Company's stockholders.
If the Amendment is not approved, the number of authorized shares will remain
the same and management will have limited flexibility to do the things described
above. Although the Board has no immediate plans, understandings, agreements or
commitments to issue any of the additional shares of common stock, the Board in
March 2000, authorized a one-for-one stock dividend and, depending on market and
other business conditions, may in the future give consideration to another stock
dividend or split.
There will be no change in the voting rights, dividend rights, liquidation
rights, preemptive rights or any other shareholder rights as a result of the
proposed Amendment. The additional shares might be issued at such times and
under such circumstances as to have a dilutive effect on earnings per share and
on the equity ownership of the present holders of Common Stock.
POTENTIAL ANTI-TAKEOVER EFFECT
The proposed Amendment could, under certain circumstances, have an
anti-takeover effect, although this is not the intention of the Amendment. The
increased number of authorized shares of Common Stock could discourage, or be
used to impede, an attempt to acquire or otherwise change control of the
Company. The private placement of shares of Common Stock into "friendly" hands,
for example, could dilute the voting strength of a party seeking control of the
Company. Furthermore, many companies have issued warrants or other rights to
acquire additional shares of Common Stock to the holders of its Common Stock to
discourage or defeat unsolicited share accumulation programs and acquisition
proposals, which programs or proposals may be viewed by the Board of Directors
as not in the best interest of the Company and its stockholders. Although the
Company has no present intent to use the additional authorized shares of Common
Stock for such purposes, if this Amendment is adopted, more capital stock of the
Company would be available for such purposes than is currently available.
6
<PAGE> 9
The affirmative vote of the holders of a majority of the outstanding shares
of Common Stock entitled to vote at the Annual Meeting, assuming a quorum is
present, is necessary for approval of the Amendment. Therefore, abstentions and
broker non-votes (which may occur if a beneficial owner of stock, whose shares
are held in a brokerage or bank account, fails to provide the broker or the bank
voting instructions as to such shares) effectively count as votes against the
Amendment.
THE BOARD OF DIRECTORS UNANIMOUSLY
RECOMMENDS A VOTE FOR APPROVAL OF THE AMENDMENT
PROPOSAL NO. 3
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Ernst & Young LLP has served as the Company's independent auditors since
the Company's inception and has been appointed by the Board to continue as the
Company's independent auditors for the Company's fiscal year ending December 31,
2000. In the event that ratification of this selection of auditors is not
approved by a majority of the shares of Common Stock voting at the Annual
Meeting in person or by proxy, management will review its future selection of
auditors. A representative of Ernst & Young LLP is expected to be present at the
Annual Meeting. The representative will have an opportunity to make a statement
and to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF THE APPOINTMENT OF
ERNST & YOUNG LLP AS THE COMPANY'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR
ENDING DECEMBER 31, 2000
7
<PAGE> 10
REPORT OF THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, that might incorporate future filings,
including this Proxy Statement, in whole or in part, the following report shall
not be deemed to be incorporated by reference into any such filings.
The Compensation Committee of the Board was formed in March 1999 and
consisted of David W. Pidwell and Arnold N. Silverman until his resignation in
June 1999. There is currently a vacancy on the Compensation Committee which will
be filled by the Board. Decisions concerning the compensation of the Company's
executive officers are made by the Compensation Committee and reviewed by the
full Board (excluding any interested director).
EXECUTIVE OFFICER COMPENSATION PROGRAMS
The objectives of the executive officer compensation program are to
attract, retain, motivate and reward key personnel who possess the necessary
leadership and management skills, through competitive base salary, annual cash
bonus incentives, long-term incentive compensation in the form of stock options,
and various benefits, including medical and life insurance plans.
The executive compensation policies of the Compensation Committee are
intended to combine competitive levels of compensation and rewards for above
average performance and to align relative compensation with the achievements of
key business objectives, optimal satisfaction of customers, and maximization of
stockholder value. The Compensation Committee believes that stock ownership by
management is beneficial in aligning management and stockholder interests,
thereby enhancing stockholder value.
Base Salaries. Salaries for the Company's executive officers are determined
primarily on the basis of the executive officer's responsibility, general salary
practices of peer companies and the officer's individual qualifications and
experience. The base salaries are reviewed annually and may be adjusted by the
Compensation Committee in accordance with certain criteria which include
individual performance, the functions performed by the executive officer, the
scope of the executive officer's on-going duties, general changes in the
compensation peer group in which the Company competes for executive talent, and
the Company's financial performance generally. The weight given each such factor
by the Compensation Committee may vary from individual to individual.
Incentive Bonuses. The Compensation Committee believes that a cash
incentive bonus plan can serve to motivate the Company's executive officers and
management to address annual performance goals, using more immediate measures
for performance than those reflected in the appreciation in value of stock
options. The bonus amounts are based upon recommendations by management and a
subjective consideration of factors including such officer's level of
responsibility, individual performance, contributions to the Company's success
and the Company's financial performance generally.
Stock Option Grants. Stock options may be granted to executive officers and
other employees under the 1999 Stock Incentive Plan. Because of the direct
relationship between the value of an option and the stock price, the
Compensation Committee believes that options motivate executive officers to
manage the Company in a manner that is consistent with stockholder interests.
Stock option grants are intended to focus the attention of the recipient on the
Company's long-term performance which the Company believes results in improved
stockholder value, and to retain the services of the executive officers in a
competitive job market by providing significant long-term earnings potential. To
this end, stock options generally vest and become fully exercisable over a
four-year period. The principal factors considered in granting stock options to
executive officers of the Company are prior performance, level of
responsibility, other compensation and the executive officer's ability to
influence the Company's long-term growth and profitability. However, the 1999
Stock Incentive Plan does not provide any quantitative method for weighting
these factors, and a decision to grant an award is primarily based upon a
subjective evaluation of the past as well as future anticipated performance.
8
<PAGE> 11
Other Compensation Plans. The Company has adopted certain general employee
benefit plans in which executive officers are permitted to participate on parity
with other employees. The Company also provides a 401(k) deferred compensation
plan.
Deductibility of Compensation. Section 162(m) of the Internal Revenue Code
("IRC") disallows a deduction by the Company for compensation exceeding $1.0
million paid to certain executive officers, excluding, among other things,
performance based compensation. Although, as a result of certain option
exercises, compensation paid to certain executive officers has exceeded this
limitation, applicable exemptions allow the deduction by the Company for such
compensation. Because the compensation paid to other executive officers has not
approached the limitation, the Compensation Committee has not had to use any of
the available exemptions from the deduction limit with regard to such officers'
compensation. The Compensation Committee remains aware the IRC Section 162(m)
limitations, and the available exemptions, and will address the issue of
deductibility when and if circumstances continue to warrant the use of such
exemptions.
CHIEF EXECUTIVE OFFICER COMPENSATION
The compensation of the Chief Executive Officer is reviewed annually on the
same basis as discussed above for all executive officers. Mr. Dhillon's base
salary for the fiscal year ended December 31, 1999 was $150,000. Mr. Dhillon's
base salary was established in part by comparing the base salaries of chief
executive officers at other companies of similar size. Mr. Dhillon's base salary
was below the median of the base salary range for Presidents/Chief Executive
Officers of comparative companies. Mr. Dhillon received 50,000 stock options and
a $90,000 bonus for the fiscal year ended December 31, 1999.
MEMBERS OF THE COMPENSATION COMMITTEE
David W. Pidwell
9
<PAGE> 12
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information concerning compensation
of (i) each person that served as the Company's Chief Executive Officer during
the last fiscal year of the Company, (ii) the four other most highly compensated
executive officers of the Company whose aggregate cash compensation exceeded
$100,000 during the year ended December 31, 1999, and (iii) up to two former
executive officers of the Company who would have been one of the Company's four
most highly compensated executive officers had such officer been serving as such
at the end of the Company's last fiscal year (collectively, the "Named Executive
Officers"):
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
-------------
ANNUAL COMPENSATION SECURITIES
--------------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) OPTIONS(#)(1) COMPENSATION($)
--------------------------- ---- --------- -------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
Gaurav S. Dhillon..................... 1999 $150,000 $ 90,000 50,000
Chief Executive Officer, 1998 130,000 52,114(2) 100,000 --
Secretary and Director
Diaz H. Nesamoney..................... 1999 150,000 90,000 50,000
Chief Operating Officer, 1998 130,000 52,114(2) 100,000 --
President and Director
Clive A. Harrison,.................... 1999 150,000 345,528(3) 40,000
Executive Vice President, 1998 140,000 109,942(4) 50,000 --
Worldwide Sales
Craig L. Klosterman(5)................ 1999 160,000 45,000 --
Chief Financial Officer, 1998 60,317 7,446 225,000 --
Senior Vice President
</TABLE>
- ---------------
(1) Reflects pre-split share numbers.
(2) Excludes bonus amounts of $8,919 earned in 1997 and paid in 1998.
(3) Includes sales commissions of $300,528.
(4) Includes sales commissions earned in 1998 and excludes commissions of
$34,010 and bonus amounts of $9,500, each earned in 1997 and paid in 1998.
(5) Mr. Klosterman commenced his employment with the Company on August 17, 1998
and terminated his employment on November 1, 1999.
10
<PAGE> 13
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides certain information with respect to stock
options granted to the Named Executive Officers during the fiscal year ended
December 31, 1999. In addition, as required by the Securities and Exchange
Commission rules, the table sets forth the potential realizable value over the
term of the option (the period from the grant to the expiration date) based on
assumed rates of stock appreciation of 5% and 10%, compounded annually. These
amounts are based on certain assumed rates of appreciation and do not represent
the Company's estimate of future stock price. Actual gains, if any, on stock
option exercises will be dependent on the future performance of the Common
Stock.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
--------------------------------------------------------------- VALUE AT ASSUMED ANNUAL
NUMBER OF PERCENT OF RATE OF STOCK PRICE
SECURITIES TOTAL OPTIONS APPRECIATION FOR OPTION
UNDERLYING GRANTED TO EXERCISE TERM
OPTIONS EMPLOYEES IN PRICE PER EXPIRATION -----------------------
NAME GRANTED(#)(1)(2) FISCAL YEAR(3) SHARE($/SH)(4) DATE 5% 10%
---- ---------------- -------------- -------------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Gaurav S. Dhillon..... 50,000 2.4% $10.75 2/5/09 $338,345 $857,433
Diaz H. Nesamoney..... 50,000 2.4% $10.75 2/5/09 338,345 857,433
Clive A. Harrison..... 40,000 1.9% $10.75 2/5/09 270,676 685,947
Craig L. Klosterman... -- -- -- -- -- --
</TABLE>
- ---------------
(1) Reflects pre-split share numbers.
(2) Each of these options vests over four years, 25% after the end of the first
year and 2.08% each month thereafter, and has a 10-year term.
(3) Based on a total of 2,082,973 options (pre-split shares) granted to
employees of the Company in 1999, including the Named Executive Officers.
(4) The exercise price per share of options granted represented the fair market
value of the underlying shares of Common Stock at the date the options were
granted.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth certain information with respect to stock
options exercised by the Named Executive Officers during fiscal year ending
December 31, 1999, including the aggregate value of gains on the date of
exercise. In addition, the table sets forth the number of shares covered by
stock options as of December 31, 1999, and the value of "in-the-money" stock
options, which represent the positive spread between the exercise price of a
stock option and the market price of the shares subject to such option on
December 31, 1999.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT DECEMBER 31, AT DECEMBER 31,
SHARES 1999(#)(1) 1999($)(3)
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE(#)(1) REALIZED($)(2) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------------- -------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Gaurav S. Dhillon.... -- -- 145,833 104,167 $15,305,383 $10,327,117
Diaz H. Nesamoney.... -- -- 145,833 104,167 15,305,383 10,327,117
Clive A. Harrison.... 188,124 $11,559,627 10,833 81,043 1,142,833 8,079,998
Craig L.
Klosterman......... 55,500 3,726,750 19,499 150,001 1,947,560 14,982,099
</TABLE>
- ---------------
(1) Reflects pre-split share numbers.
(2) The value realized upon the exercise of stock options represents the
positive spread between the exercise price of stock options and the fair
market of the shares subject to such options on the exercise date.
(3) Calculated by determining the difference between the fair market value of
the securities underlying the option at December 31, 1999 ($106.38 per
share) and the exercise price of the Named Executive Officers' respective
options.
11
<PAGE> 14
STOCK PERFORMANCE GRAPH
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, that might incorporate future filings,
including this Proxy Statement, in whole or in part, the following report and
the graph shall not be deemed to be incorporated by reference into any such
filings
The following graph compares the percentage change in the cumulative total
stockholder return on the Company's Common Stock from April 28, 1999, the date
of the Company's initial public offering, through the end of the Company's
fiscal year ended December 31, 1999, with the percentage change in the
cumulative total return for the Nasdaq National Market (U.S. Companies) Index
and Nasdaq Computer and Data Processing Services Group Index. The comparison
assumes an investment of $100 on April 28, 1999 in the Company's Common Stock
and in each of the foregoing indices and assumes reinvestment of dividends. The
stock performance shown on the graph below is not necessarily indicative of
future price performance.
[STOCK PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
INFORMATICA INFA NASDAQ-U.S. IXIC NASDAQ-COMPUTER IXCO
---------------- ---------------- --------------------
<S> <C> <C> <C>
4/29/1999 100.00 100.00 100.00
5/28/1999 81.70 97.71 93.70
6/30/1999 121.28 106.24 107.78
7/30/1999 177.55 104.35 106.13
8/31/1999 191.06 108.34 116.20
9/30/1999 172.77 108.61 116.92
10/29/1999 245.96 117.32 125.46
11/30/1999 248.09 131.95 142.59
12/31/1999 362.13 160.94 180.79
</TABLE>
STOCKHOLDER PROPOSALS
Requirements for Stockholder Proposals to be Brought Before an Annual
Meeting. For stockholder proposals to be considered properly brought before an
annual meeting by a stockholder, the stockholder must have given timely notice
therefor in writing to the Secretary of the Company. To be timely, a
stockholder's notice must be delivered to or mailed and received by the
Secretary of the Company at the principal executive offices of the Company,
between January 29, 2001 and February 28, 2001. A stockholder's notice to the
Secretary must set forth as to each matter the stockholder proposes to bring
before the annual meeting (i) a brief description of the business desired to be
brought before the annual meeting and the reasons for conducting such business
at the annual meeting, (ii) the name and record address of the stockholder
12
<PAGE> 15
proposing such business, (iii) the class and number of shares of the Company
which are beneficially owned by the stockholder, and (iv) any material interest
of the stockholder in such business.
Requirements for Stockholder Proposals to be Considered for Inclusion in
the Company's Proxy Materials. Stockholder proposals submitted pursuant to Rule
14a-8 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")
and intended to be presented at the Company's 2001 annual meeting of
stockholders must be received by the Company not later than December 5, 2000 in
order to be considered for inclusion in the Company's proxy materials for that
meeting.
OTHER MATTERS
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's directors,
executive officers and persons who own more than 10% of the Company's Common
Stock (collectively, "Reporting Persons") to file reports of ownership and
changes in ownership of the Company's Common Stock. Reporting Persons are
required by Securities and Exchange Commission regulations to furnish the
Company with copies of all Section 16(a) reports they file. Based solely on its
review of the copies of such reports received or written representations from
certain Reporting Persons, the Company believes that during the fiscal year
ended December 31, 1999, all Reporting Persons complied with all applicable
filing requirements, except that one Form 4 filing covering an option and
warrant exercise by David W. Pidwell, two Form 4 filings covering a sale and
gift by Diaz H. Nesamoney, one Form 4 filing covering an option grant to Earl E.
Fry and one Form 3 filing reporting the appointment of Earl E. Fry as Chief
Financial Officer were inadvertently filed late.
OTHER MATTERS
The Board of Directors knows of no other business which will be presented
at the Annual Meeting. If any other business is properly brought before the
Annual Meeting, it is intended that proxies in the enclosed form will be voted
in respect thereof in accordance with the judgments of the persons voting the
proxies.
It is important that the proxies be returned promptly and that your shares
be represented. Stockholders are urged to mark, date, execute and promptly
return the accompanying proxy card in the enclosed envelope.
By Order of the Board of Directors,
/s/ Gaurav S. Dhillon
Gaurav S. Dhillon
Chief Executive Officer, Secretary and
Director
April 21, 2000
Palo Alto, California
13
<PAGE> 16
[FORM OF FRONT OF PROXY CARD]
PROXY
INFORMATICA CORPORATION
3350 W. Bayshore Boulevard
Palo Alto, CA 94086
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING ON MAY 25, 2000.
Gaurav S. Dhillon and Earl E. Fry, or either of them, each with the
power of substitution, are hereby authorized to represent and vote the shares of
the undersigned, with all the powers which the undersigned would possess if
personally present, at the Annual Meeting of Stockholders of Informatica
Corporation (the "Company"), to be held on Thursday, May 25, 2000 at 3350 W.
Bayshore Road, Palo Alto, California, and any adjournment or postponement
thereof.
Election of one (1) Class I Director, two (2) Class II directors, and
two (2) Class III directors (or if any nominee is not available for election,
such substitute as the Board of Directors or the proxy holders may designate).
Nominees: VINCENT R. WORMS (CLASS I), DIAZ H. NESAMONEY AND A. BROOKE SEAWELL
(CLASS II), AND GAURAV S. DHILLON AND DAVID W. PIDWELL (CLASS III).
<PAGE> 17
[FORM OF BACK OF PROXY CARD]
Please mark your choice like this [X] in blue or black ink.
MARK HERE FOR ADDRESS
CHANGE AND NOTE AT [ ]
RIGHT
Shares represented by this proxy will be voted as directed by the
stockholder. If no such directions are indicated, the Proxies will have
authority to vote FOR the election of all directors, and FOR proposals 2 and 3.
-------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE
ELECTION OF DIRECTORS AND FOR PROPOSALS 2 AND 3
-------------------------------------------------------
1. Election of Directors (see reverse):
[ ] FOR [ ] WITHHELD
FOR, except vote withheld from the following nominee(s):
-------------------------------------------------------
-------------------------------------------------------
2. Approval of an amendment to the Company's Amended and Restated
Certificate of Incorporation to increase the number of shares of Common
Stock which the Company is authorized to issue from 100,000,000 shares
to 200,000,000 shares.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. To ratify and approve the appointment of Ernst & Young LLP as the
Company's independent auditors for the fiscal year ending December 31,
2000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting.
Please sign exactly as your name appears herein. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee or guardian, please
give full title as such.
Signature Date
------------------------------- -------------------
Signature Date
------------------------------- -------------------
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
REPLY ENVELOPE.
