<PAGE>
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:
[X] Preliminary Proxy Statement
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
SunGard Data Systems Inc.
(Name of Registrant as Specified In Its Charter)
SunGard Data Systems Inc.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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:*
(4) Proposed maximum aggregate value of transaction:
- --------
*Set forth the amount on which the filing is calculated and state how it was
determined.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
[LETTERHEAD OF SUNGARD APPEARS HERE]
April 4, 1994
Dear Stockholder:
You are cordially invited to attend the 1994 Annual Meeting of Stockholders of
SunGard Data Systems Inc., which will be held on Monday, May 9, 1994, beginning
at 9:00 a.m., at the Pennsylvania Convention Center, 1101 Arch Street,
Philadelphia, Pennsylvania. The official notice of the meeting, together with a
proxy statement and proxy card, is enclosed. Please give this information your
careful attention.
Your participation in the Company's affairs is important. To assure your
representation at the meeting, whether or not you expect to be present, please
date and sign the enclosed proxy card and return it as soon as possible in the
envelope provided. Also, please indicate on the proxy card whether you plan to
attend the meeting.
Your copy of the Company's 1993 Annual Report also is enclosed. We appreciate
your interest in the Company.
Sincerely,
/s/James L. Mann
James L. Mann
Chairman, President and
Chief Executive Officer
- -------------------------------------------------------------------------------
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE DATE AND SIGN YOUR PROXY
CARD AND PROMPTLY RETURN IT IN THE REPLY ENVELOPE PROVIDED (WHICH REQUIRES NO
POSTAGE IF MAILED IN THE UNITED STATES). IF YOU RECEIVE MORE THAN ONE PROXY
CARD BECAUSE YOU OWN SHARES THAT ARE REGISTERED DIFFERENTLY, THEN PLEASE DATE,
SIGN AND RETURN ALL OF THEM. THANK YOU.
- -------------------------------------------------------------------------------
<PAGE>
SunGard Data Systems Inc.
1285 Drummers Lane
Wayne, Pennsylvania 19087
(610) 341-8700
---------------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MAY 9, 1994
---------------------------------------------
To Our Stockholders:
The 1994 Annual Meeting of Stockholders of SunGard Data Systems Inc. will be
held at 9:00 a.m. local time, on Monday, May 9, 1994, at the Pennsylvania
Convention Center, 1101 Arch Street, Philadelphia, Pennsylvania 19107, for the
following purposes:
1. To elect directors.
2. To vote on approval of an Amendment to the Company's Certificate of
Incorporation increasing the number of authorized shares of common stock by
30,000,000.
3. To vote on approval of the Company's 1994 Equity Incentive Plan.
4. To vote on ratification of the appointment of Coopers & Lybrand as the
Company's independent accountants for 1994.
5. To act upon such other business as may properly come before the meeting.
Only holders of the Company's common stock at the close of business on March 16,
1994 are entitled to receive notice of the meeting and to vote at the meeting.
You are cordially invited to attend the meeting in person. Whether or not you
plan to attend the meeting, you are urged to date and sign the enclosed proxy
card and promptly return it in the enclosed reply envelope (which requires no
postage if mailed in the United States).
By Order of the Board of Directors,
/s/Lawrence A. Gross
Lawrence A. Gross
Vice President and General Counsel,
Secretary
April 4, 1994
<PAGE>
SunGard Data Systems Inc.
1285 Drummers Lane
Wayne, Pennsylvania 19087
(610) 341-8700
PROXY STATEMENT
This proxy statement and the accompanying proxy card are being furnished to the
stockholders of SunGard Data Systems Inc. in connection with the solicitation of
proxies on behalf of the Board of Directors of the Company for use in voting at
the 1994 Annual Meeting of Stockholders or at any adjournment or postponement of
the meeting. These proxy materials are first being mailed to stockholders on or
about April 4, 1994.
Proxies in the form enclosed, if properly submitted and not revoked, will be
voted as directed on the proxies. Any proxy not directing to the contrary will
be voted "for" the election of the named nominees as directors and "for"
approval of each of the other Proposals. Sending in a signed proxy does not
affect a stockholder's right to attend the meeting and vote in person, since the
proxy is revocable. Any stockholder who submits a proxy may revoke it at any
time before it is voted by delivering a later-dated proxy or a written notice of
revocation to the Secretary of the Company at the Company's headquarters or at
the meeting.
At the close of business on March 16, 1994, the record date for the
determination of stockholders of the Company entitled to receive notice of and
to vote at the 1994 Annual Meeting, the Company's outstanding voting securities
consisted of approximately 18,807,000 shares of common stock, held by
approximately 2,040 stockholders of record. In order for a quorum to be present
at the 1994 Annual Meeting, a majority of the outstanding shares of the
Company's common stock as of the close of business on the record date must be
present in person or represented by proxy at the meeting. All such shares that
are present in person or represented by proxy at the meeting will be counted in
determining whether a quorum is present, no matter how the shares are voted or
whether they abstain from voting.
Holders of common stock are entitled to one vote per share. The election of
directors will be determined by a plurality vote, with the eight nominees
receiving the most "for" votes being elected. Approval of the Amendment to the
Company's Certificate of Incorporation requires that the holders of a majority
of the outstanding shares vote "for" the Amendment. Approval of each of the
other proposals requires that a majority of the quorum vote "for" the proposal.
An abstention or broker non-vote on any proposal other than the election of
directors, therefore, will have the same legal effect as an "against" vote,
although some persons analyzing the voting results may interpret these actions
differently.
The Company will pay the cost of this solicitation, which will be made primarily
by mail. Proxies also may be solicited in person, or by telephone, facsimile or
similar means, by directors, officers or employees of the Company without
additional compensation. In addition, D. F. King & Co., Inc. will provide
solicitation services to the Company for a fee of approximately $4,000 plus out-
of-pocket expenses. The Company will, on request, reimburse stockholders who
are brokers, dealers, banks or voting trustees, or their nominees, for their
reasonable expenses in sending proxy materials and annual reports to the
beneficial owners of the shares they hold of record.
1
<PAGE>
PROPOSAL ONE
ELECTION OF DIRECTORS
Eight directors are to be elected at the 1994 Annual Meeting to serve for one-
year terms until the 1995 Annual Meeting and until their respective successors
are elected and qualified. Seven of the eight nominees currently are serving as
directors of the Company. The Company knows of no reason why any nominee would
be unable to serve as a director. Each nominee has consented to being named in
this proxy statement and to serve if elected. If any nominee should for any
reason become unable to serve, then all valid proxies will be voted for the
election of such substitute nominee as the Board of Directors may designate, or
the Board may reduce the number of directors to eliminate the vacancy.
The following information about the Company's nominees for election as directors
is based, in part, upon information furnished by the nominees.
<TABLE>
<CAPTION>
Nominee and Current Age Principal Occupations and Employment
Positions with the Company
<S> <C> <C>
Gregory S. Bentley 38 Vice President (since 1991), Bentley Systems,
Director (since 1991) Inc., Exton, PA (engineering software
Member, Audit Committee company); President (1983 to 1991), SunGard
Capital Markets Inc., a subsidiary of the
Company since 1987.
- -------------------------------------------------------------------------------
Michael C. Brooks 49 General Partner (since 1985), J. H. Whitney &
Director (since 1985) Co., New York, NY (venture capital firm).
Chairman, Compensation
Committee, Member,
Executive Committee
- -------------------------------------------------------------------------------
Albert A. Eisenstat 63 Private investor (since 1993); Executive or
Director (since 1991) Senior Vice President (1985 to 1993) and Vice
Member, Compensation President and General Counsel (1980 to 1987),
Committee Apple Computer, Inc., Cupertino, CA (computer
and software company).
- -------------------------------------------------------------------------------
Bernard Goldstein 63 Managing Director (since 1979), Broadview
Nominee Associates, Fort Lee, NJ (investment banking
firm).
- -------------------------------------------------------------------------------
James L. Mann 59 Chairman of the Board (since 1987) and
Director (since 1983) President and Chief Executive Officer (since
Chairman, Executive 1986) of the Company; President and Chief
Committee, Chairman of Operating Officer (1983 to 1985) of the
the Board, President Company.
and Chief Executive Officer
- -------------------------------------------------------------------------------
Michael Roth 62 Of Counsel (since 1989), Rosenman & Colin,
Director (since 1991) New York, NY (law firm); Partner (1979 to
Member, Compensation 1989), Shea & Gould, New York, NY (law firm).
Committee
- -------------------------------------------------------------------------------
Malcolm I. Ruddock 51 Treasurer (since 1989), Director of Finance
Director (since 1983) (1988 to 1989) and Director of Acquisitions
Chairman, Audit Committee and Divestments (1979 to 1988), Sun Company,
Member, Executive Committee Inc., Philadelphia, PA (energy resources
company).
- -------------------------------------------------------------------------------
Lawrence J. Schoenberg 61 Director of public companies (since 1990);
Director (since 1991) Chairman (1967 to 1991) and Chief Executive
Member, Audit Committee Officer (1967 to 1990), AGS Computers, Inc.,
Mountainside, NJ (software and computer
services company).
- --------------------------------------------------------------------------------
</TABLE>
Mr. Brooks also is a director of Filene's Basement Corp. Mr. Eisenstat also is
a director of Commercial Metals Company. Mr. Goldstein also is a director of
Apple Computer Inc., Franklin Electronic Publishing Inc. and SPSS, Inc. Mr.
2
<PAGE>
Schoenberg also is a director of Government Technology Services Inc., Image
Business Systems Inc., Merisel Inc. and PennAmerica Group Inc.
Board of Directors and Committee Meetings
During 1993, the Board of Directors held six meetings, the Audit Committee held
four meetings, the Compensation Committee held four meetings, and the Executive
Committee held two meetings. The Board of Directors does not have a standing
Nominating Committee. During 1993, each director attended at least 92% of the
total number of meetings of the Board of Directors and Committees on which he
served. Meeting attendance averaged 99% among all directors.
The Audit Committee reviews the Company's accounting and financial practices and
policies and the scope and results of the Company's external and internal
audits. The Audit Committee also recommends to the Board of Directors the
selection of the Company's independent public accountants and administers the
Company's business conduct, conflict of interest and related policies.
The Compensation Committee establishes the compensation policies for executive
officers of the Company, evaluates and approves the compensation of the chief
executive officer and reviews his recommendations as to the compensation of the
other executive officers. The Compensation Committee also administers the
Company's stock option, purchase and award plans. Only outside directors who
are not employees of the Company may serve on the Compensation Committee.
The Executive Committee reviews certain aspects of transactions and policies
that have been generally approved by the Board of Directors. The Executive
Committee also is authorized to exercise the powers of the Board of Directors
during the intervals between Board meetings, except those powers that are
prohibited by law from being delegated.
Director Compensation
Directors who are employees of the Company do not receive additional
compensation for serving on the Board of Directors or Committees. Each outside
director receives an annual fee of $6,000, fees of $2,000 for each quarterly
meeting of the Board of Directors attended and $500 for each other Board meeting
attended, and reimbursement of applicable travel and other expenses. No
additional fees are paid for attendance at Committee meetings, which usually are
held the same day as Board meetings.
Under the Company's Restricted Stock Award Plan for Outside Directors,
restricted stock awards are automatically granted to "outside directors" --
those who are not, and were not during the twelve months before election to the
Board, officers or employees of the Company. Each outside director
automatically receives an award of 5,000 shares upon initial election to the
Board, and will automatically receive additional awards of 5,000 shares upon
reelection as an outside director every fifth year thereafter. The shares
awarded are subject to transfer restrictions until they vest, at the rate of
1,000 shares per year, on the dates of the Company's next five Annual Meetings
following the date of grant. If an outside director dies or is permanently
disabled, or if a change in control of the Company occurs, then all remaining
unvested shares immediately vest. If an outside director's directorship
terminates for any other reason, then all remaining unvested shares are
forfeited.
At the 1993 Annual Meeting, Mr. Bentley qualified for the first time as an
outside director and received his initial restricted stock award for 5,000
shares of common stock. If Mr. Goldstein is elected as a director at the 1994
Annual Meeting, he will receive at that time his initial restricted stock award
for 5,000 shares of common stock.
The Company has entered into indemnification agreements, in the form approved by
the stockholders, with the Company's directors and officers.
3
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table contains certain information about the beneficial ownership
of the Company's common stock as of March 16, 1994 (the record date) by each
person who is known by the Company to beneficially own more than 5% of the
Company's common stock, by each of the Company's directors and nominees for
director, by each of the Company's executive officers named in the Summary
Compensation Table below, and by all of the Company's directors, nominees and
executive officers as a group.
<TABLE>
<CAPTION>
Number of Shares Beneficially Owned Percent
Name of Beneficial Owner or Group ------------------------------------------------- of
Direct/(1)/ Voting or Right to Class/(4)/
Investment Power/(2)/ Acquire/(3)/
=====================================================================================================================
<S> <C> <C> <C> <C>
First Union Corporation and -- 1,253,715/(6)/ -- 6.7%
First Union National Bank of North Carolina/(5)/
11 Tobey Village Office Park
Pittsford, New York 14534
- ----------------------------------------------------------------------------------------------------------------------
Kenneth R. Adams (executive officer) 6,399 1,225/(7)/ 12,969 --
- ----------------------------------------------------------------------------------------------------------------------
Gregory S. Bentley (director) 62,439 -- -- --
- ----------------------------------------------------------------------------------------------------------------------
Michael C. Brooks (director) 6,000 -- -- --
- ----------------------------------------------------------------------------------------------------------------------
Cristobal I. Conde (executive officer) 107,439 -- 5,000 --
- ----------------------------------------------------------------------------------------------------------------------
Philip L. Dowd (executive officer) 37,208 6,668 73,000 --
- ----------------------------------------------------------------------------------------------------------------------
Albert A. Eisenstat (director) 5,000 -- -- --
- ----------------------------------------------------------------------------------------------------------------------
Bernard Goldstein (nominee) 4,500 500 -- --
- ----------------------------------------------------------------------------------------------------------------------
Lawrence A. Gross (executive officer) 2,182 -- 25,575 --
- ----------------------------------------------------------------------------------------------------------------------
James L. Mann (director and chief executive officer) 255,872 -- 61,426 1.7%
- ----------------------------------------------------------------------------------------------------------------------
Michael Roth (director) 5,000 -- -- --
- ----------------------------------------------------------------------------------------------------------------------
Malcolm I. Ruddock (director) 6,000 -- -- --
- ----------------------------------------------------------------------------------------------------------------------
Lawrence J. Schoenberg (director) 4,438 -- -- --
- ----------------------------------------------------------------------------------------------------------------------
All 19 directors, nominees and executive officers 627,923 10,103/(7)/ 275,695 4.8%
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Shares held in the beneficial owner's name or jointly with others, or in
the name of a broker, bank, nominee or trustee for the beneficial owner's
account, including shares held under the Company's Employee Stock Purchase
Plan. Includes 4,000, 5,000, 3,000, 2,000, 3,000, 1,120, 125,000, 3,000,
3,000 and 3,000 restricted shares held by Messrs. Adams, Bentley, Brooks,
Dowd, Eisenstat, Gross, Mann, Roth, Ruddock and Schoenberg, respectively,
and 156,640 restricted shares held by all directors, nominees and executive
officers as a group, that are subject to transfer restrictions and
forfeiture under the Company's restricted stock plans.
(2) Shares for which the beneficial owner has or may be deemed to have sole or
shared voting and/or investment power.
(3) Shares which the beneficial owner has the right to acquire within 60 days
after the record date by exercising stock options. Includes 2,000, 10,000,
10,545, and 2,676 unvested shares that may be acquired by Messrs. Conde,
Dowd, Gross and Mann, respectively, and 58,166 unvested shares that may be
acquired by all executive officers as a group which, if acquired, would be
subject to transfer restrictions and repurchase by the Company under the
Company's stock option plans.
4
<PAGE>
(4) Unless otherwise indicated, the beneficial ownership of any named person
does not exceed one percent of the outstanding shares of common stock.
(5) This beneficial owner is a customer of the Company, having purchased the
Company's software products and computer services in the ordinary course of
business.
(6) Based upon a Schedule 13G, dated February 10, 1994, filed by the beneficial
owners.
(7) Includes 1,225 and 2,875 shares held by members of the immediate families
of Mr. Adams and of all executive officers as a group, respectively, as to
which beneficial ownership is disclaimed.
EXECUTIVE COMPENSATION
Compensation Committee Report
The Company's compensation policies for executive officers, as determined by the
Compensation Committee, are to (1) provide competitive compensation packages so
as to attract and retain superior executive talent, (2) link a significant
portion of compensation to financial results, so as to reward successful
performance, and (3) provide long-term equity based compensation, so as to
further align the interests of executive officers with those of stockholders and
further reward successful performance. The principal components of the
Company's executive officer compensation program are base salary, annual cash
incentive payments, periodic stock options and awards, and, beginning in 1994,
long-term performance based incentive awards for the chief executive officers of
the Company's five operating business groups (see Proposal Three).
The primary factor used to set cash compensation for the Company's executive
officers is an analysis of competitive executive compensation based upon general
business compensation surveys as well as more specific compensation surveys of
companies of comparable business, size and complexity to the Company. An
independent compensation consultant, whose services are available to the
Compensation Committee, assists the Company with this analysis of competitive
compensation. The S&P Computer Software and Services Index (see Performance
Graph) is not used for this analysis, because it does not provide a large enough
statistical sample, nor does it encompass the broader spectrum of businesses
with which the Company competes for executive talent.
The Company's policy is to pay its executive officers at or somewhat
above competitive compensation averages for comparable positions.
Compensation levels for individual executive officers, however, may be more or
less than competitive averages, depending upon a subjective assessment of
individual factors such as the executive's position, skills, achievements,
tenure with the Company and historical compensation levels. In applying the
analysis of competitive compensation, the Company focuses on total cash
compensation. The split between base salary and annual cash incentive payment
also is based upon that analysis, but it tends to be somewhat more influenced
by individual factors such as the executive's position and historical
compensation levels. Generally, previously granted stock options and
restricted stock awards are not considered in setting cash compensation
levels.
5
<PAGE>
The performance goals for executive officers' 1993 annual cash incentive plans
were set at the beginning of the year and took into account the Company's
overall financial goals for 1993. For corporate officers, the incentive
payments depended solely upon the rate of increase in the Company's net income
over the previous year, except that in one case an additional incentive payment
was based upon a performance goal specific to the executive's function. For
group chief executive officers, the incentive payments depended solely upon the
budgeted operating income of the operating business groups they manage, except
that from zero to 25% of the incentive payment could be lost depending upon the
group's average number of days sales outstanding in accounts receivable.
On average, total cash compensation at targeted goals for executive
officers increased by approximately 5.5% in 1993, and incentive
payments at targeted goals constituted approximately 29% of total
cash compensation. Based upon actual 1993 results, all executive officers
exceeded their targeted goals except for two group chief executive
officers who did not achieve their minimum targets.
Historically, the Company's stock based award plans have represented its long-
term incentive program for executive officers. Stock options and restricted
stock awards have been granted at irregular intervals at the discretion of the
Compensation Committee, but with the goal of implementing the Company's
compensation policies described above. In deciding whether to grant an award to
a particular executive and, if so, for how many shares, the Compensation
Committee considers primarily the executive's position, skills, achievements and
tenure with the Company, the level and vesting schedule of awards previously
granted to the executive, and, in applicable cases, the number of shares of the
Company's common stock received by the executive when the executive's business
was acquired by the Company. The Compensation Committee also takes into account
the total number of stock options outstanding both before and after the newly
contemplated awards.
In 1994, the Company has begun granting long-term incentive compensation awards
to the group chief executive officers, subject to stockholder approval of the
underlying plan (see Proposal Three). These awards allow each group chief
executive officer to earn options to purchase shares of the Company's common
stock, based upon the cumulative growth in his group's operating income over
three years.
The Company is studying the new federal income tax provision that denies a
deduction for certain compensation exceeding $1,000,000 paid to the chief
executive officer and four other highest paid executive officers excluding
(among other things) certain performance based compensation. The Company
intends that its general stock option grants will qualify for the performance
based exclusion and intends to evaluate the extent to which its other
compensation will qualify for that exclusion.
Mr. Mann's base salary for 1993 was $340,000, an increase of $15,000 or 5% over
his 1992 base salary. Mr. Mann's 1993 annual cash incentive payment depended
solely upon the rate of increase in the Company's net income. The Company's
goal is to grow its net income by 15% per year. If the Company's 1993 net
income had increased by 15%, then Mr. Mann's 1993 incentive payment would have
been approximately $185,000, yielding total cash compensation at approximately
the 50th percentile of competitive compensation levels based upon the
Company's analysis. The Company's actual 1993 net income (excluding the gain
on a product line sale) grew by 36%, yielding an incentive payment to Mr. Mann
of $364,928.
Due primarily to the level and vesting schedule of awards previously granted, no
stock options or restricted stock awards were granted to Mr. Mann or other
executive officers during 1993, except in the case of one newly hired group
chief executive officer.
Michael C. Brooks, Chairman of Compensation Committee
Albert A. Eisenstat, Member of Compensation Committee
Michael Roth, Member of Compensation Committee
6
<PAGE>
Summary Compensation Table
The following table contains certain information about compensation earned
during the last three fiscal years by the Company's chief executive officer and
four other executive officers who were most highly compensated during the most
recent fiscal year. The Company's fiscal year is the calendar year.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Annual Compensation Long-Term Compensation
-------------------------------------------------------------
Awards/(2)(3)/ Payouts All
Other --------------------------- Other
Name and Principal Position Year Salary Bonus Annual Securities Long-Term Compensa-
($) ($) Compensa- Underlying Incentive tion ($)/(4)/
tion ($)/(1)/ Options/SARs (#) Plans ($)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
JAMES L. MANN 1993 340,000 364,928 53,161 -- -- 8,929
Chairman of the Board, President 1992 325,000 267,227 51,430 -- -- 8,728
and Chief Executive Officer 1991 290,000 204,269 7,496 31,250 -- 6,533
- ------------------------------------------------------------------------------------------------------------------------------------
KENNETH R. ADAMS/(5)/ 1993 170,000 259,500 6,227 -- -- 12,306
Chief Executive Officer, SunGard 1992 238,500 289,195 6,030 -- 1,367,183 11,634
Recovery Services Group 1991 227,100 127,346 4,197 -- 411,695 9,035
- ------------------------------------------------------------------------------------------------------------------------------------
CRISTOBAL I. CONDE 1993 297,250 -- -- -- -- 4,891
Chief Executive Officer, SunGard 1992 292,224 -- -- -- -- 3,782
Capital Markets Systems Group 1991 289,898 -- -- -- -- 1,935
- ------------------------------------------------------------------------------------------------------------------------------------
PHILIP L. DOWD 1993 210,000 132,839 3,997 -- -- 6,745
Chief Executive Officer, SunGard 1992 192,244 150,412 2,202 -- -- 7,989
Trust & Shareholder Systems Group 1991 170,000 114,544 3,552 -- -- 6,356
- ------------------------------------------------------------------------------------------------------------------------------------
LAWRENCE A. GROSS 1993 191,700 87,516 4,827 -- -- 7,796
Vice President and General Counsel 1992 154,000 118,834 3,853 1,575 -- 6,862
1991 145,600 113,107 3,275 14,000 -- 6,268
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Consists of amounts reimbursed in connection with the payment of taxes.
The cost of perquisites is not disclosed for any executive officer named in
the table, because the disclosure threshold (the lower of $50,000 or 10% of
salary plus bonus) was not reached.
(2) On December 31, 1993, based upon the last sale price that day of $41.25 per
share of the Company's common stock, Messrs. Mann, Adams, Dowd and Gross
held 125,000, 4,000, 2,000 and 1,120 restricted shares, respectively,
valued at $5,156,250, $165,000, $82,500 and $46,200, respectively. The
Company has never paid dividends on its common stock, but holders of
restricted shares would be entitled to dividends if any were paid.
(3) Generally, the Company's stock option and restricted stock awards vest over
five years. Upon termination of employment, only vested stock option
shares may be purchased, but unvested restricted stock vests immediately
except in the case of a voluntary resignation or termination for cause.
Upon a change in control of the Company, all unvested stock options and
restricted stock vests six months later or upon an earlier involuntary
termination of employment without cause.
(4) Consists of Company contributions to a defined contribution retirement
plan. For Mr. Adams, also included are premium payments for a personal
(not a key-man) life insurance policy of $3,312, $2,906 and $2,368 in 1993,
1992 and 1991, respectively.
(5) During 1988, when Mr. Adams became the chief executive officer of SunGard
Recovery Services, the Company granted to him a long-term incentive award
covering the years 1989 through 1992. The payouts under this long-term
incentive award, which were based upon the financial performance of the
business units managed by Mr. Adams, consisted of stock options having an
exercise price of $8.00 per share with all option shares fully vested on
the date earned.
7
<PAGE>
Aggregated Option Exercises and Year-End Option Value Table
The following table contains, for each of the Company's executive officers named
in the Summary Compensation Table, (a) the number of shares of the Company's
common stock acquired upon the exercise of options during 1993, (b) the value
realized as a result of those exercises (based upon the last sale price on the
date of exercise less the option exercise price), (c) the number of shares of
the Company's common stock underlying unexercised options held on December 31,
1993, and (d) the value of in-the-money options held on December 31, 1993, based
upon the last sale price that day of $41.25 per share of common stock.
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
Shares Value Number of Securities Underlying Value of Unexercised
Acquired Realized ($) Unexercised Options In-The-Money Options
Name on at Year-End (#) at Year-End ($)
Exercise (#) ----------------------------------------------------------------
Exercisable/(1)/ Unexercisable Exercisable/(1)/ Unexercisable
=====================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
James L. Mann -- -- 61,426 9,824 2,013,859 267,704
- ---------------------------------------------------------------------------------------------------------------------
Kenneth R. Adams/(2)/ 100,000 2,983,750 12,969 -- 431,219 --
- ---------------------------------------------------------------------------------------------------------------------
Cristobal I. Conde -- -- 5,000 -- 156,250 --
- ---------------------------------------------------------------------------------------------------------------------
Philip L. Dowd -- -- 73,000 10,000 2,401,750 312,500
- ---------------------------------------------------------------------------------------------------------------------
Lawrence A. Gross 8,000 148,000 25,575 -- 722,153 --
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Exercisable option shares include 8,926, 2,000, 10,000 and 13,660 unvested,
in-the-money option shares having year-end values of $243,234, $62,500,
$312,500 and $376,423, respectively, which, if acquired by Messrs. Mann,
Conde, Dowd and Gross, respectively, would be subject to transfer
restrictions and repurchase by the Company under the Company's stock option
plans.
(2) All options exercised by Mr. Adams during 1993 and all options held by Mr.
Adams at year-end were options that he received as long-term incentive
payouts (see Summary Compensation Table).
Certain Transactions with Management
Recipients of restricted stock awards from the Company also received non-
recourse, balloon loans from the Company to help defray taxes due as a result of
the awards. These loans bear interest at the prime rate, and the Company
reimburses recipients for their costs incurred in connection with the interest
due under the loans. In 1991, Mr. Mann received such a loan in the amount of
$499,750. This loan was outstanding throughout 1993 and will mature in 1995.
As a result of an acquisition, the Company leases one of its facilities from an
executive officer and his spouse, for which the Company paid rent of $279,672
during 1993.
Mr. Goldstein, a nominee for director of the Company, is Managing Director of
Broadview Associates, an investment banking firm engaged by the Company in
connection with acquisitions.
Compensation Committee Interlocks and Insider Participation
No person who served as a member of the Company's Compensation Committee during
1993 was a current or former officer or employee of the Company. Mr. Roth, a
member of the Company's Compensation Committee, is Of Counsel to Rosenman &
Colin, a law firm engaged by the Company for certain matters.
8
<PAGE>
During 1993, the Company had no compensation committee "interlocks" meaning that
it was not the case that an executive officer of the Company served as a
director or member of the compensation committee of another entity and an
executive officer of the other entity served as a director or member of the
Compensation Committee of the Company.
Performance Graph
The following graph shows a comparison of the five-year cumulative total return
for the Company's common stock, the S&P 500 Index and the S&P Computer Software
and Services Index, assuming an investment of $100 in each on December 31, 1988.
The data points used for the performance graph are listed in the chart below.
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------
Performance Graph Data Points 12/31/88 12/31/89 12/31/90 12/31/91 12/31/92 12/31/93
=============================================================================================================
<S> <C> <C> <C> <C> <C> <C>
SunGard Data Systems Inc. Common Stock 100 153 73 122 192 266
- -------------------------------------------------------------------------------------------------------------
S&P 500 Index/(1)/ 100 132 128 166 179 197
- -------------------------------------------------------------------------------------------------------------
S&P Computer Software & Services Index/(1)/ 100 122 95 145 172 219
- -------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Source: Zacks Investment Research, Inc.
9
<PAGE>
Compliance with Section 16(a) of the Exchange Act
Section 16(a) of the Securities Exchange Act of 1934 ("Exchange Act") requires
the Company's directors and officers (and possibly other persons) to file
reports about their beneficial ownership of the Company's common stock and
debentures. Based solely upon a review of the copies of such reports furnished
to the Company by its directors and officers during and with respect to the year
1993, and based upon their written representations that they were not required
to file any other reports for 1993, the Company believes that none of its
directors or officers failed to file on a timely basis any reports required by
Section 16(a) of the Exchange Act with respect to the year 1993.
PROPOSAL TWO
APPROVAL OF AN AMENDMENT TO THE COMPANY'S
CERTIFICATE OF INCORPORATION INCREASING THE NUMBER
OF AUTHORIZED SHARES OF COMMON STOCK BY 30,000,000
Under the Company's Certificate of Incorporation, the Company currently is
authorized to issue up to 30,000,000 shares of common stock. As of December 31,
1993, there were approximately 9,797,000 authorized shares of the Company's
common stock that were not issued or reserved for future issuance. In February
1994, the Board of Directors approved an Amendment to the Company's Certificate
of Incorporation that increases the maximum number of authorized shares by
30,000,000 to a total of 60,000,000 shares, subject to approval by the
stockholders of the Company. The purpose of the Amendment is to provide
sufficient shares for future stock splits, stock dividends, recapitalizations,
acquisitions and other corporate purposes, although no such use currently is
planned. Once authorized, the additional shares of common stock may be issued
with approval of the Board of Directors but without further approval of the
stockholders unless stockholder approval is required by applicable law, rule
or regulation. Accordingly, this solicitation may be the only opportunity for
stockholders to approve such stock splits, stock dividends, recapitalizations,
acquisitions and other corporate transactions.
Stockholder approval of this proposal is required under Delaware law. Approval
of the Amendment to the Company's Certificate of Incorporation increasing the
number of authorized shares of common stock by 30,000,000 requires the
affirmative vote of the holders of a majority of the outstanding shares of
common stock. If the stockholders do not approve the Amendment, then the number
of authorized shares of the Company's common stock will remain at 30,000,000.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL TWO.
PROPOSAL THREE
APPROVAL OF THE COMPANY'S 1994 EQUITY INCENTIVE PLAN
In February 1994, the Board of Directors adopted the Company's 1994 Equity
Incentive Plan ("Incentive Plan"), subject to approval by the stockholders of
the Company. The primary reason for adopting the Incentive Plan is to ensure
that the Company will be able to continue providing equity based compensation to
its key employees, especially in view of the fact that the Company's 1986 Stock
Option Plan, its current principal equity based plan, will expire in 1996.
Purposes. The purposes of the Incentive Plan are to promote the long-term
retention of the Company's key employees and certain other persons who are in a
position to make significant contributions to the success of the Company, to
further reward these employees and other persons for their contributions, to
provide additional incentive to these employees and other persons to continue
making similar contributions, and to further align the interests of these
employees and other persons with those of the Company's stockholders. To
achieve these purposes, the Incentive Plan permits grants of incentive stock
options ("ISOs"), options not intended to qualify as ISOs ("nonqualified
options"), stock appreciation rights ("SARs"), restricted, unrestricted and
deferred stock awards, performance awards, loans and supplemental cash awards,
and combinations of the foregoing (all referred to as "Awards").
10
<PAGE>
Number of Shares. The Incentive Plan permits Awards to be granted for a total
of 500,000 shares of the Company's common stock, with an individual limit
of 100,000 shares per recipient per year (subject to appropriate adjustments
to reflect changes in the capitalization of the Company), which may be
treasury shares, reacquired shares or newly-issued shares. Shares issuable
under Awards that terminate unexercised, shares issuable under Awards that are
payable in stock or cash but are paid in cash, and shares issued but later
forfeited will be available for future Awards under the Incentive Plan.
Eligible Recipients. All current and future employees of the Company, and other
persons who, in the opinion of the Compensation Committee, are in a position to
make significant contributions to the success of the Company, such as
consultants and non-employee directors other than members of the Compensation
Committee itself, are eligible to receive Awards under the Incentive Plan.
Administration. The Incentive Plan is administered by the Compensation
Committee, which determines, among other things and subject to certain
conditions, the persons eligible to receive Awards, the persons who actually
receive Awards, the type of each Award, the number of shares of common stock
subject to each Award, the date of grant, exercise schedule, vesting schedule
and other terms and conditions of each Award, whether to accelerate the exercise
or vesting schedule or waive any other term or condition of an Award, whether to
amend or cancel an Award, and the form of any instrument used under the
Incentive Plan. The Compensation Committee has the right to adopt rules for the
administration of the Incentive Plan, settle all controversies regarding the
Incentive Plan and any Award, construe and correct defects and omissions in the
Incentive Plan and any Award, and suspend or terminate the Incentive Plan
subject to certain conditions. The Incentive Plan may be amended by the
Compensation Committee, subject to certain conditions, provided that stockholder
approval will be required whenever necessary for the Incentive Plan to continue
to satisfy the requirements of certain securities and tax laws, rules and
regulations.
Stock Options. Recipients of stock options under the Incentive Plan will have
the right to purchase shares of the Company's common stock at an exercise price,
during a period of time and on such other terms and conditions determined by the
Compensation Committee. For ISOs, the recipient must be an employee,
the exercise price must be at least 100% (110% if issued to a 10% stockholder)
of fair market value on the date of grant, and the term cannot exceed ten
years (five years if issued to a 10% stockholder) from the date of grant. If
permitted by the Compensation Committee and subject to certain conditions, an
option exercise price may be paid by delivery of shares of the Company's
common stock that have been outstanding for at least six months, or a
promissory note, or a broker's undertaking to promptly deliver the necessary
funds, or by a combination of those methods. If permitted by the Compensation
Committee, options (other than those granted in tandem with SARs) may be
settled by the Company paying to the recipient, in cash or shares of common
stock (valued at fair market value), an amount equal to the fair market value
minus the exercise price of the option shares.
SARs. SARs may be granted under the Incentive Plan either alone or in tandem
with stock options. Generally, recipients of SARS are entitled to receive, upon
exercise, cash or shares of common stock (valued at fair market value) equal to
the fair market value on the date of exercise minus the fair market value on the
date of grant of the shares subject to the SAR, although certain other
measurements also may be used. A SAR granted in tandem with a stock option is
exercisable only if and to the extent that the option is exercised.
Stock Awards. The Incentive Plan provides for restricted, unrestricted or
deferred stock awards. Stock awards allow the recipient to acquire shares of
the Company's common stock for their par value or any higher price determined by
the Compensation Committee. In the case of restricted stock awards, the shares
acquired are subject to a vesting schedule and other possible conditions
determined by the Compensation Committee. In the case of a deferred stock
award, the recipient is entitled to acquire shares in the future at such times
and on such conditions determined by the Compensation Committee.
11
<PAGE>
Performance Awards. The Incentive Plan provides for performance awards
entitling the recipient to receive stock options, stock awards or other types of
Awards conditional upon achieving performance goals determined by the
Compensation Committee. Performance goals may involve overall corporate
performance, operating group or business unit performance, personal performance
or any other category of performance determined by the Compensation Committee.
Financial performance may be measured by revenue, operating income, net income,
earnings per share, number of days sales outstanding in accounts receivable,
productivity, return on equity, common stock price, price-earnings multiple,
or other financial factor determined by the Compensation Committee.
Other Awards. Under the Incentive Plan, loans or supplemental cash awards may
be granted to recipients of Awards to help defray taxes due as a result of the
Awards. The terms and conditions of loans and supplemental cash awards,
including the interest rate which may be zero, and whether any loan will be
forgiven, are determined by the Compensation Committee.
Termination of Employment. Generally, upon termination of a recipient's
employment or relationship with the Company, stock options and SARS remain
exercisable for a period of three months (one year if termination is due to
death or disability) to the extent that they were exercisable at the time of
termination, and unvested shares under outstanding restricted stock awards vest
immediately except in the case of a voluntary resignation or termination for
cause (as defined in the Incentive Plan). Stock options, SARs and other Awards
that are not exercisable at the time of termination automatically terminate, and
payments or benefits under deferred stock awards, performance awards and
supplemental cash awards that are not irrevocably due at the time of termination
are forfeited.
Change in Control. Upon a change in control of the Company (as defined in the
Incentive Plan), all outstanding options and SARs become fully exercisable, all
unvested shares under outstanding restricted stock awards vest, and all
conditions on deferred stock awards, performance awards and supplemental cash
awards that relate only to the passage of time and continued employment lapse,
in all cases effective six months after the change in control or upon an earlier
involuntary termination of employment without cause. The pre-change in control
Board of Directors of the Company may elect, however, to suspend operation
of some or all of the change in control acceleration provisions.
Summary of Federal Income Tax Consequences. This discussion, which is based
upon federal income tax law as in effect on December 31, 1993, summarizes
certain federal income tax consequences associated with the Incentive Plan. The
tax consequences to executive officers, directors, and others subject to Section
16 of the Exchange Act may be different from those summarized below.
No taxable income is realized upon the grant of a stock option or SAR, nor upon
the exercise of an ISO except to the extent that the exercise may result in
alternative minimum tax liability. Upon the exercise of a nonqualified option,
the recipient realizes ordinary income equal to the fair market value on the
date of exercise minus the exercise price of the option shares. Upon the
exercise of a SAR, the recipient realizes ordinary income equal to the amount of
cash and fair market value of any shares of common stock received. If
restricted or deferred shares of common stock are used to settle a stock option
or SAR, however, then the realization of income may be deferred. Upon a
disposition of shares acquired by exercise of a stock option or SAR, the gain or
loss generally constitutes a capital gain or loss. In the case of a disposition
of ISO shares within one year after the date of exercise or within two years
after the date of grant, the difference between the fair market value on the
date of exercise and the exercise price constitutes ordinary income, and any
additional gain above the fair market value on the date of exercise constitutes
a capital gain.
Upon the grant of an unrestricted stock award, the recipient realizes ordinary
income equal to the fair market value on the date of grant minus the price paid
for the shares awarded. A recipient of a restricted stock award realizes
ordinary income only as and when the shares vest, and a recipient of a deferred
stock award realizes ordinary income only when the shares are actually
transferred. The ordinary income realized on each vesting or transfer date
equals the fair market value on that date less
12
<PAGE>
the price paid for the shares. A recipient of a restricted stock award may,
however, choose or be required by the terms of the award to elect under Section
83(b) of the Internal Revenue Code to have the ordinary income associated with
all of the restricted shares realized and measured on the date of grant. A
recipient who makes such an election and later forfeits restricted shares may
not claim a loss for tax purposes.
The tax consequences of a performance award depend upon the nature of the
underlying Award earned if and when the performance goals are achieved.
Generally, loans made under the Incentive Plan do not result in taxable income
to the recipient. If the interest rate is lower than certain rates specified
under the Internal Revenue Code, however, then ordinary income may be imputed to
the recipient. Forgiveness of all or part of a loan also results in ordinary
income to the recipient. The recipient of a supplemental cash award realizes
ordinary income equal to the amount received.
Generally, whenever a recipient realizes ordinary income, a corresponding
deduction is available to the Company. Under the Revenue Reconciliation Act of
1993, however, the Company will be denied a deduction for certain compensation
exceeding $1,000,000 paid to its chief executive officer and four other highest
paid executive officers, excluding (among other things) certain performance
based compensation (see Compensation Committee Report).
1994 Awards. Under the Incentive Plan, and as approved by the Compensation
Committee, the Company has granted long-term executive incentive compensation
awards ("1994 Awards") to the Company's group chief executive officers,
subject to stockholder approval of the Incentive Plan. The 1994 Awards will
allow each group chief executive officer to earn options to purchase
shares of the Company's common stock, based upon the cumulative growth
in his group's operating income during 1994 through 1996. Stock options earned
under the 1994 Awards will be nonqualified options, will be granted as of the
first trading day after the end of the three-year incentive period, will have
a term of ten years beginning on the date of grant, and will be fully vested
beginning on the date of grant.
The number of stock options that may be earned under each of the 1994
Awards depends upon whether the cumulative operating income growth during
the three-year incentive period reaches certain minimum or goal targets.
If the minimum target is not achieved, then no options will be earned. If
actual results are between the minimum and goal targets, then the number of
option shares will be prorated, and the exercise price will be $38.65 per
share, which is the average of the last reported sale prices of the Company's
common stock on the first ten trading days of 1994. If the goal target is
exceeded, then the number of option shares will be the goal amount, and the
option exercise price will be reduced depending upon the amount by which the
goal target was exceeded, but not below $24.74 per share. The following table
indicates, for each of the Company's executive officers named in the
Summary Compensation Table and for all of the Company's executive officers
as a group, the number of shares of common stock underlying options that
will be granted under the 1994 Awards if the minimum or goal targets
for cumulative operating income growth are met.
<TABLE>
<CAPTION>
Name Number of Units
(Number of Shares Underlying Options)
---------------------------------------
Minimum Goal
==================================================================
<S> <C> <C>
James L. Mann -- --
- ------------------------------------------------------------------
Kenneth R. Adams 5,100 10,200
- ------------------------------------------------------------------
Cristobal I. Conde 3,400 6,800
- ------------------------------------------------------------------
Philip L. Dowd 5,100 10,200
- ------------------------------------------------------------------
Lawrence A. Gross -- --
- ------------------------------------------------------------------
All 12 executive officers 21,000 42,000
- ------------------------------------------------------------------
</TABLE>
Future Awards. If the Incentive Plan is approved by the stockholders, then the
Company currently plans, but will have no legal obligation or commitment, to
continue granting long-term executive incentive compensation awards, similar to
the 1994 Awards, to the group chief executive officers on
13
<PAGE>
an annual basis, subject to approval by the Compensation Committee. Like the
1994 Awards, each of these annual awards would cover three-year incentive
periods. No other awards under the Incentive Plan are currently planned, but
others may be granted as determined by the Compensation Committee.
Stockholder Approval. There are three reasons for seeking stockholder approval
of the Incentive Plan. One is to satisfy a NASD bylaw that requires companies
whose shares are reported on the NASDAQ National Market System to obtain
stockholder approval of stock plans for directors, officers or key employees.
The second reason is to satisfy federal income tax law requirements relating to
ISOs and requirements relating to performance based compensation, both of which
include stockholder approval. The third reason is to satisfy the requirements
of Rule 16b-3 under the Exchange Act, which include stockholder approval. If
the Rule 16b-3 requirements are satisfied, then neither the grant of stock
options, SARs or stock awards under the Incentive Plan, nor the transfer of
shares to pay an option exercise price under the Incentive Plan (subject to
certain conditions) will trigger the provisions of Section 16(b) of the Exchange
Act regarding "short-swing" profits. If the stockholders do not approve the
Incentive Plan, then neither the Incentive Plan nor the 1994 Awards will become
effective.
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR"
PROPOSAL THREE.
PROPOSAL FOUR
RATIFICATION OF APPOINTMENT
OF INDEPENDENT ACCOUNTANTS
The accounting firm of Coopers & Lybrand has acted as the Company's independent
accountants since its inception in 1983 and has been recommended by the Audit
Committee and selected by the Board of Directors to serve as the Company's
independent accountants for 1994. Coopers & Lybrand's services to the Company
for 1993 included the audit of the Company's annual consolidated financial
statements, reviews of the Company's federal income tax returns, third party
reviews of many of the Company's data processing and disaster recovery centers,
and consultation on various tax, securities and other matters.
A representative of Coopers & Lybrand is expected to be present at the 1994
Annual Meeting, to have the opportunity to make a statement if he desires to do
so, and to be available to respond to appropriate questions.
Although the selection of the Company's independent public accountants is not
required by law to be submitted to the stockholders for ratification, the
Company has adopted the policy of submitting this selection to a vote of its
stockholders. If the stockholders do not ratify the appointment of Coopers &
Lybrand as the Company's independent accountants for 1994, then the appointment
will be reconsidered by the Audit Committee and the Board of Directors.
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR"
PROPOSAL FOUR.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the Company's 1995 Annual
Meeting must be submitted by December 5, 1994 to receive consideration for
inclusion in the Company's 1995 proxy materials.
14
<PAGE>
SunGard(R) Data Systems Inc.
Form of Proxy for 1994 Annual Meeting
- --------------------------------------------------------------------------------
SunGard(R) Data Systems Inc.
1994 Annual Meeting of Stockholders--May 9, 1994
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned hereby appoints James L. Mann and Malcolm I. Ruddock, and each
of them, as attorneys and proxies of the undersigned, with full power of
substitution, for and in the name, place and stead of the undersigned, to
represent the undersigned and to vote, as directed below, all shares of Common
Stock of SunGard Data Systems Inc. (the "Company") held by the undersigned as of
March 16, 1994, at the Company's 1994 Annual Meeting of Stockholders to be held
on May 9, 1994 or at any postponement or adjournment of the meeting.
PROPOSAL 1: [_] FOR the election of Gregory S. Bentley, Michael C. Brooks,
Albert A. Eisenstat, James L. Mann, Michael Roth,
Malcolm I. Ruddock and Lawrence J. Schoenberg as directors.
To withhold authority to vote for all nominees, check here: [_]
To withhold authority to vote for any individual nominee(s),
clearly print his or their names in this space:
-------------------------------------------------------------------
PROPOSAL 2: [_] FOR [_] AGAINST [_] ABSTAIN the approval of an Amendment
to the Company's Certificate of Incorporation to increase the
number of authorized shares of common stock by 30,000,000.
PROPOSAL 3: [_] FOR [_] AGAINST [_] ABSTAIN the approval of the Company's
1994 Equity Incentive Plan.
PROPOSAL 4: [_] FOR [_] AGAINST [_] ABSTAIN the ratification of the
appointment of Coopers & Lybrand as the Company's independent
accountants for 1994.
THIS PROXY WILL BE VOTED AS DIRECTED ABOVE.
UNLESS YOU DIRECT OTHERWISE, THIS PROXY WILL BE VOTED "FOR" ALL PROPOSALS.
(continued on reverse side)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(continued from reverse side)
Both proxy agents present and acting in person or by their substitutes (or, if
only one is present and acting, then that one) may exercise all of the powers
conferred by this proxy. DISCRETIONARY AUTHORITY IS CONFERRED BY THIS PROXY
WITH RESPECT TO CERTAIN MATTERS, AS DESCRIBED IN THE COMPANY'S PROXY STATEMENT.
The undersigned hereby acknowledges receipt of the Company's 1993 Annual Report
to Stockholders, Notice of the Company's 1994 Annual Meeting of Stockholders,
and the Company's Proxy Statement dated April 4, 1994.
Date: , 1994
--------------------------------
(please date this proxy)
--------------------------------------
--------------------------------------
signature(s)
Please sign your name exactly as it is
printed on this proxy, indicating any
title or other representative
capacity. If more than one name is
printed on this proxy, all must sign.
PLEASE DATE AND SIGN THIS PROXY AND PROMPTLY RETURN IT IN THE
ENCLOSED POSTAGE-PAID ENVELOPE.
PLEASE CHECK HERE IF YOU PLAN TO ATTEND THE COMPANY'S 1994 ANNUAL MEETING: [_]
- --------------------------------------------------------------------------------
<PAGE>
SUNGARD DATA SYSTEMS INC.
1994 EQUITY INCENTIVE PLAN
- --------------------------------------------------------------------------------
1. Purpose
The purpose of the SunGard Data Systems Inc. Equity Incentive Plan
(the "Plan") is to promote the long-term retention of key employees of SunGard
Data Systems Inc., ("SunGard") and its current future subsidiaries
(collectively, the "Company") and other persons or entities who are in a
position to make significant contributions to the success of the Company, to
further reward these employees and other persons and entities for their
contributions to the Company's success, to provide additional incentive to
these employees and other persons and entities to continue to make similar
contributions in the future, and to further align the interests of these
employees and other persons and entities with those of the Company's
stockholders. These purposes will be achieved by granting to such employees
and other persons or entities, in accordance with the provisions of this Plan,
Options, Stock Appreciation Rights, Restricted Stock or Unrestricted Stock
Awards, Deferred Stock Awards or Performance Awards, for shares of SunGard's
common stock, $0.01 par value per share ("Common Stock"), or Loans or
Supplemental Grants, or combinations thereof ("Awards").
2. Aggregate Number of Shares
2.1 The aggregate number of shares of Common Stock for which Awards may be
granted under the Plan will be 500,000 shares, with an individual limit of
100,000 shares per Participant per year. Notwithstanding the foregoing, if
there is any change in the capitalization of SunGard, such as by stock
dividend, stock split, combination of shares, exchange of securities,
recapitalization or other event which the Compensation Committee (the
"Committee") of the Board of Directors (the "Board") of SunGard deems, in its
sole discretion, to be similar circumstances, the aggregate number and/or kind
of shares for which Awards may be granted under the Plan shall be
appropriately adjusted in a manner determined by the Committee. No fractional
shares of Common Stock will be delivered under the Plan.
2.2 Treasury shares, reacquired shares and unissued shares of Common Stock
may be used for purposes of the Plan, at SunGard's sole discretion.
2.3 Shares of Common Stock that were issuable pursuant to an Award that
has terminated but with respect to which such Award had not been exercised,
shares of Common Stock that are issued pursuant to an Award but that are
subsequently forfeited, and shares of Common Stock that were issuable pursuant
to an Award that was payable in Common Stock or cash but that was satisfied in
cash, shall be available for future Awards under the Plan.
3. Eligible Employees and Participants
3.1 All current and future key employees of the Company, including
officers and directors who are employed by the Company, ("Employees") and all
other persons or entities, including directors of the Company who are not
Employees, who, in the opinion of the
<PAGE>
Committee, are in a position to make a significant contribution to the success
of the Company, shall be eligible to receive Awards under the Plan. Members of
the Committee shall not be eligible to receive Awards. No eligible Employee or
other person or entity (a "Participant") shall have any right to receive an
Award except as expressly provided in the Plan.
3.2 The key employees and other persons or entities who shall actually
receive Awards under the Plan shall be determined by the Committee in its sole
discretion. In making such determinations, the Committee shall consider the
positions and responsibilities of eligible employees and other persons or
entities, their past performance and contributions to the Company's growth and
expansion, the value of their services to the Company, the difficulty of finding
qualified replacements, and such other factors as the Committee deems pertinent
in its sole discretion.
4. Administration
4.1 The Plan shall be administered by the Committee. Each member of the
Committee shall be a "disinterested person" within the meaning of Rule 16b-3
under the Securities Exchange Act of 1934, as amended (the "1934 Act"). In
addition to its other authority and subject to the provisions of the Plan, the
Committee shall have the authority to determine, in its sole discretion, the
Participants who shall be eligible to receive Awards, the Participants who shall
actually receive Awards, the size of each Award, including the number of shares
of Common Stock subject to the Award, the type or types of each Award, the date
on which each Award shall be granted, the terms and conditions of each Award,
whether to waive compliance by a Participant with any obligations to be
performed by the Participant under an Award or waive any term or condition of an
Award, whether to amend or cancel an existing Award in whole or in part (except
that the Committee may not, without the consent of the holder of an Award or
unless specifically authorized by the terms of an Award, take any action under
this clause with respect to such Award if such action would adversely affect the
rights of such holder), and the form or forms of instruments that are required
or deemed appropriate under the Plan, including any written notices and
elections required of Participants.
4.2 The Committee may adopt such rules for the administration of the Plan
as it deems necessary or advisable, in its sole discretion. For all purposes of
the Plan, a majority of the members of the Committee shall constitute a quorum,
and the vote or written consent of a majority of the members of the Committee on
a particular matter shall constitute the act of the Committee on that matter.
The Committee shall have the exclusive right to construe the Plan and any Award,
to settle all controversies regarding the Plan or any Award, to correct defects
and omissions in the Plan and in any Award, and to take such further actions as
the Committee deems necessary or advisable, in its sole discretion, to carry out
the purpose and intent of the Plan. Such actions shall be final, binding and
conclusive upon all parties concerned.
4.3 No member of the Committee or the Board shall be liable for any act or
omission (whether or not negligent) taken or omitted in good faith, or for the
good faith exercise of any authority or discretion granted in the Plan to the
Committee or the Board, or for any act or omission of any other member of the
Committee or the Board.
- 2 -
<PAGE>
4.4 All costs incurred in connection with the administration and operation
of the Plan shall be paid by the Company. Except for the express obligations of
the Company under the Plan and under Awards granted in accordance with the
provisions of the Plan, the Company shall have no liability with respect to any
Award, or to any Participant or any transferee of shares of Common Stock from
any Participant, including, but not limited to, any tax liabilities, capital
losses, or other costs or losses incurred by any Participant or any such
transferee.
5. Types of Awards
5.1 Options.
(a) An Option is an Award entitling the recipient on exercise thereof to
purchase Common Stock at a specified exercise price. Both "incentive stock
options," as defined in Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code") (any Option intended to qualify as an incentive stock
option being hereinafter referred to as an "ISO"), and Options that are not
incentive stock options, may be granted under the Plan. ISOs shall be awarded
only to Employees.
(b) The exercise price of an Option will be determined by the Committee
subject to the following:
(1) The exercise price of an ISO shall not be less than 100% (110% in
the case of an ISO granted to a ten percent shareholder) of the fair market
value of the Stock subject to the Option, determined as of the time the Option
is granted. A "ten-percent shareholder" is any person who at the time of grant
owns, directly or indirectly, or is deemed to own by reason of the attribution
rules of section 424(d) of the Code, stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company or of any of its
subsidiaries.
(2) In no case may the exercise price paid for Common Stock which is
part of an original issue of authorized Common Stock be less than the par value
per share of the Common Stock.
(3) The Committee may reduce the exercise price of an option at any
time after the time of grant, but in the case of an Option originally awarded as
an ISO, only with the consent of the Participant.
(c) The period during which an Option may be exercised will be determined
by the Committee, except that the period during which an ISO may be exercised
will not exceed ten years (five years, in the case of an ISO granted to a ten-
percent shareholder) from the day immediately preceding the date the Option
was granted.
(d) An Option will become exercisable at such time or times, and on such
terms and conditions, as the Committee may determine. The Committee may at any
time accelerate the time at which all or any part of the Option may be
exercised. Any exercise of an Option must be in writing, signed by the proper
person and delivered or mailed to the Company, accompanied by (1) any documents
required by the Committee and (2) payment in full in accordance with Section
5.1(e) below for the number of shares for which the Option is exercised.
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(e) Stock purchased on exercise of an Option must be paid for as follows:
(1) in cash or by check (acceptable to SunGard in accordance with guidelines
established for this purpose), bank draft or money order payable to the order of
SunGard or (2) if so permitted by the instrument evidencing the Option (or in
the case of an Option which is not an ISO, by the Committee at or after grant of
the Option), (i) through the delivery of shares of Common Stock which have been
outstanding for at least six months (unless the Committee expressly approves a
shorter period) and which have a fair market value on the last business day
preceding the date of exercise equal to the exercise price, or (ii) by delivery
of a promissory note of the Option holder to SunGard, payable on such terms and
conditions as the Committee may determine, or (iii) by delivery of an
unconditional and irrevocable undertaking by a broker to deliver promptly to
SunGard sufficient funds to pay the exercise price, or (iv) by any combination
of the permissible forms of payment; provided, that if the Common Stock
delivered upon exercise of the Option is an original issue of authorized Common
Stock, at least so much of the exercise price as represents the par value of
such Common Stock must be paid other than by the Option holder's promissory
note.
(f) If the market price of shares of Stock subject to an Option (other
than an Option which is in tandem with a Stock Appreciation Right as described
in Section 6.2 below) exceeds the exercise price of the Option at the time of
its exercise, the Committee may cancel the Option and cause SunGard to pay in
cash or in shares of Common Stock (at a price per share equal to the fair market
value per share) to the person exercising the Option an amount equal to the
difference between the fair market value of the Common Stock which would have
been purchased pursuant to the exercise (determined on the date the Option is
canceled) and the aggregate exercise price which would have been paid. The
Committee may exercise its discretion to take such action only if it has
received a written request from the person exercising the Option, but such a
request will not be binding on the Committee.
5.2 Stock Appreciation Rights.
(a) A Stock Appreciation Right is an Award entitling the recipient on
exercise of the Right to receive an amount, in cash or Common Stock or a
combination thereof (such form to be determined by the Committee), determined in
whole or in part by reference to appreciation in Common Stock value. In general,
a Stock Appreciation Right entitles the Participant to receive, with respect to
each share of Common Stock as to which the Right is exercised, the excess of the
share's fair market value on the date of exercise over its fair market value on
the date the Right was granted. However, the Committee may provide at the time
of grant that the amount the recipient is entitled to receive will be adjusted
upward or downward under rules established by the Committee to take into account
the performance of the Common Stock in comparison with the performance of other
stocks or an index or indices of other stocks. The Committee may also grant
Stock Appreciation Rights that provide that following a Change in Control of the
Company (as defined in Section 6.3(b) hereof) the holder of such Right will be
entitled to receive, with respect to each share of Common Stock subject to the
Right, an amount equal to the excess of a specified value (which may include an
average of values) for a share of Common Stock during a period preceding such
Change in Control over the fair market value of a share of Common Stock on the
date the Right was granted.
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<PAGE>
(b) Stock Appreciation Rights may be granted in tandem with, or
independently of, Options granted under the Plan. A Stock Appreciation Right
granted in tandem with an Option which is not an ISO may be granted either at or
after the time the Option is granted. A Stock Appreciation Right granted in
tandem with an ISO may be granted only at the time the Option is granted.
(c) When Stock Appreciation Rights are granted in tandem with Options, the
following rules will apply:
(1) The Stock Appreciation Right will be exercisable only at such
time or times, and to the extent, that the related Option is exercisable and
will be exercisable in accordance with the procedure required for exercise of
the related Option.
(2) The Stock Appreciation Right will terminate and no longer be
exercisable upon the termination or exercise of the related Option, except that
a Stock Appreciation Right granted with respect to less than the full number of
shares covered by an Option will not be reduced until the number of shares as to
which the related Option has been exercised or has terminated exceeds the number
of shares not covered by the Stock Appreciation Right.
(3) The Option will terminate and no longer be exercisable upon the
exercise of the related Stock Appreciation Right.
(4) The Stock Appreciation Right will be transferable only with the
related Option.
(5) A Stock Appreciation Right granted in tandem with an ISO may be
exercised only when the market price of the Stock subject to the Option exceeds
the exercise Price of such option.
(d) A Stock Appreciation Right not granted in tandem with an Option will
become exercisable at such time or times, and on such terms and conditions, as
the Committee may specify. The Committee may at any time accelerate the time at
which all or any part of the Right may be exercised. Any exercise of an
independent Stock Appreciation Right must be in writing, signed by the proper
person and delivered or mailed to SunGard, accompanied by any other documents
required by the Committee.
5.3 Restricted and Unrestricted Stock.
(a) A Restricted Stock Award entitles the recipient to acquire, for a
purchase price not less than the par value, shares of Common Stock subject to
the restrictions described in Section 5.3(d) below ("Restricted Stock").
(b) A Participant who is granted a Restricted Stock Award shall have no
rights with respect to such Award unless the Participant accepts the Award by
written instrument delivered or mailed to SunGard accompanied by payment in full
of the specified purchase price, if any, of the shares covered by the Award.
Payment may be by certified or bank check or other instrument acceptable to the
Committee.
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<PAGE>
(c) A Participant who receives Restricted Stock shall have all the rights
of a stockholder with respect to the Stock, including voting and dividend
rights, subject to the restrictions described in paragraph (d) below and any
other conditions imposed by the Committee at the time of grant. Unless the
Committee otherwise determines, certificates evidencing shares of Restricted
Stock will remain in the possession of the Company until such shares are free of
all restrictions under the Plan.
(d) Except as otherwise specifically provided by the Plan or the Award,
Restricted Stock may not be sold, assigned, exchanged, pledged, gifted or
otherwise disposed of, or transferred, and if a Participant suffers a Status
Change (as defined at Section 6.1 below) for any reason, must be offered to
SunGard for purchase for the amount of cash paid for the Common Stock, or
forfeited to the Company if no cash was paid. These restrictions will lapse at
such time or times, and on such terms and conditions, as the Committee may
determine. The Committee may at any time accelerate the time at which the
restrictions on all or any part of the shares will lapse.
(e) Any Participant making, or required by an Award to make, an election
under Section 83(b) of the Code with respect to Restricted Stock shall deliver
to SunGard, within 10 days of the filing of such election with the Internal
Revenue Service, a copy of such election.
(f) The Committee may, at the time any Award described in this Section 5
is granted, provide that any or all the Common Stock delivered pursuant to the
Award will be Restricted Stock.
(g) The Committee may, in its sole discretion, approve the sale to any
Participant of shares of Common Stock free of restrictions under the Plan for a
price which is not less than the par value of the Common Stock.
5.4 Deferred Stock. A Deferred Stock Award entitles the recipient to
receive shares of Common Stock to be delivered in the future. Delivery of the
Common Stock will take place at such time or times, and on such terms and
conditions, as the Committee may determine. The Committee may at any time
accelerate the time at which delivery of all or any part of the Common Stock
will take place. At the time any Award described in this Section 5 is granted,
the Committee may provide that, at the time Common Stock would otherwise be
delivered pursuant to the Award, the Participant will instead receive an
instrument evidencing the Participant's right to future delivery of Deferred
Stock.
5.5 Performance Awards. A Performance Award entitles the recipient to
receive, without payment, an Award or Awards described in this Section 5
following the attainment of such performance goals, during such measurement
period or periods, and on such other terms and conditions, all as the
Committee may determine. Performance goals may be related to overall corporate
performance, operating group or business unit performance, personal
performance or such other category of performance as the Committee may
determine. Financial performance may be measured by revenue, operating income,
net income, earnings per share, number of days sales outstanding in accounts
receivable, productivity, return on equity, common stock price, price-earnings
multiple, or such other financial factor as the Committee may determine.
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<PAGE>
5.6 Loans and Supplemental Grants.
(a) The Company may make a loan to a Participant ("Loan"), either in
connection with the purchase of Common Stock under the Award or the payment of
any Federal, state and local income tax with respect to income recognized as a
result of the Award. The Committee shall have the authority, in its sole
discretion, to determine whether to make a Loan, the amount, terms and
conditions of the Loan, including the interest rate (which may be zero), whether
the Loan is to be secured or unsecured or with or without recourse against the
borrower, the terms on which the Loan is to be repaid and the terms and
conditions, if any, under which the Loan may be forgiven. In no event shall any
Loan have a term (including extensions) in excess of ten years.
(b) In connection with any Award, the Committee may, grant a cash award to
the Participant ("Supplemental Grant") not to exceed an amount equal to (1) the
amount of any Federal, state and local income tax on ordinary income for which
the Participant may be liable with respect to the Award, determined by assuming
taxation at the highest marginal rate, plus (2) an additional amount on a
grossed-up basis intended to make the Participant whole on an after-tax basis
after discharging all the Participant's income tax liabilities arising from all
payments under this Section 5. Any payments under this Section 5(b) shall be
made at the time the Participant incurs Federal income tax liability with
respect to the Award.
6. Events Affecting Outstanding Awards
6.1. Termination of Service by Death or Disability. If a Participant who
is an Employee ceases to be an Employee, or if there is a termination of the
consulting, service or other relationship in respect of which a non-Employee
Participant was granted an Award hereunder (such termination of employment or
other relationship being hereinafter referred to as a "Status Change") by reason
of death or permanent disability (as determined by the Committee), the following
rules shall apply, unless otherwise determined by the Committee:
(a) All Options and Stock Appreciation Rights held by the Participant at
the time of such Status Change, to the extent then exercisable, will continue to
be exercisable by the Participant's heirs, executor, administrator or other
legal representative, for a period of one year after the Participant's Status
Change. After the expiration of such one-year period, all such Options and
Stock Appreciation Rights shall terminate. In no event, however, shall an
Option or Stock Appreciation Right remain exercisable beyond the latest date on
which it could have been exercised without regard to this Section 6. All
Options and Stock Appreciation Rights held by a Participant at the time of such
Status Change that are not then exercisable shall terminate upon such Status
Change.
(b) All Restricted Stock held by the Participant at the time of such
Status Change shall immediately become free of all restrictions and conditions.
(c) Any payment or benefit under a Deferred Stock Award, Performance Award
or Supplemental Grant to which the Participant was not irrevocably entitled at
the time of such Status Change shall be forfeited and the Award canceled as of
the time of such Status Change.
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<PAGE>
6.2 Termination of Service Other Than by Death or Disability. If a
Participant suffers a Status Change other than by reason of death or permanent
disability (as determined by the Committee), the following rules shall apply,
unless otherwise determined by the Committee:
(a) All Options and Stock Appreciation Rights held by the Participant at
the time of such Status Change, to the extent then exercisable, will continue to
be exercisable by the Participant for a period of three months after the
Participant's Status Change. After the expiration of such three-month period,
all such Options and Stock Appreciation Rights shall terminate. In no event,
however, shall an Option or Stock Appreciation Right remain exercisable beyond
the latest date on which it could have been exercised without regard to this
Section 6. All Options and Stock Appreciation Rights held by a Participant at
the time of such Status Change that are not then exercisable shall terminate
upon such Status Change.
(b) All Restricted Stock held by the Participant at the time of such
Status Change shall immediately become free of all restrictions and conditions,
unless such Status Change results from a termination for Cause (as defined in
Section 6.2(d)), in which event all Restricted Stock held by the Participant at
the time of the Status Change shall be transferred to the Company (and, in the
event the certificates representing such Restricted Stock are held by the
Company, such Restricted Stock shall be so transferred without any further
action by the Participant) in accordance with Section 5.3 above.
(c) Any payment or benefit under a Deferred Stock Award, Performance
Award, or Supplemental Grant to which the Participant was not irrevocably
entitled at the time of such Status Change shall be forfeited and the Award
canceled as of the date of such Status Change.
(d) A termination by the Company of a Participant's employment with or
service to the Company shall be for "Cause" only if: (a) at least 75% of the
members of the Board determined that the Participant (i) was guilty of gross
negligence or willful misconduct in the performance of his or her duties for the
Company, or (ii) breached or violated, in a material respect, any agreement
between the Participant and the Company or any of the Company's policy
statements regarding conflicts-of-interest, insider trading or confidentiality,
or (iii) committed a material act of dishonesty or breach of trust; and (b) in
the case of a Participant who is an Employee, (i) such determination was made
at a duly convened meeting of the Board with respect to which the Participant
received at least 10 days prior written notice, had a reasonable opportunity to
make a statement and answer the allegations against him or her; and (ii) either
(A) the Participant was given a reasonable opportunity to take remedial action
but failed or refused to do so, or (B) at least 75% of the members of the Board
also determined, at such meeting, that an opportunity to take remedial action
would not have been meaningful under the circumstances.
(e) For all purposes of this Section 6.2 and Section 6.3, (a) if a
Participant is an Employee of a subsidiary of SunGard and such subsidiary ceases
to be a subsidiary of SunGard, then the Participant's employment with the
Company will be deemed to have been terminated by the Company without Cause,
unless the Participant is transferred to SunGard or another subsidiary of
SunGard; (b) the employment with the Company of a Participant who is an Employee
will not be deemed to have been terminated if the Participant is transferred
from
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<PAGE>
SunGard to a subsidiary of SunGard, or vice versa, or from one subsidiary of
SunGard to another; and (c) if a Participant who is an Employee terminates his
or her employment with the Company following a reduction in his or her rate of
compensation, then the Participant's employment with the Company will be deemed
to have been terminated by the Company without Cause.
6.3 Change in Control
(a) In the event of a Change in Control (as defined in Section 6.3(b)),
the following rules will apply, unless otherwise expressly provided by the
Committee at the time of the grant of the Award or unless otherwise determined
by the Board in accordance with Section 6.3(c):
(1) Each outstanding Option and Stock Appreciation Right shall
automatically become exercisable in full six months after the occurrence of such
Change in Control or, if sooner, upon a termination by the Company of the
Participant's employment with or service to the Company for any reason other
than for Cause (as defined in Section 6.2(d)). This provision shall not prevent
an Option or Stock Appreciation Right from becoming exercisable sooner as to
Common Stock or cash that would otherwise have become available under such
Option or Right during such period.
(2) Each outstanding share of Restricted Stock shall automatically
become free of all restrictions and conditions six months after the occurrence
of such Change in Control or, if sooner, upon a termination by the Company of
the Participant's employment with or service to the Company for any reason other
than for Cause (as defined in Section 6.2(d)). This provision shall not prevent
the earlier lapse of any restrictions or conditions on Restricted Stock that
would otherwise have lapsed during such period.
(3) Conditions on Deferred Stock Awards, Performance Awards and
Supplemental Grants which relate only to the passage of time and continued
employment shall automatically terminate six months after the occurrence of such
Change in Control or, if sooner, upon a termination by the Company of the
Participant's employment with or service to the Company for any reason other
than for Cause (as defined in Section 6.2(d)). This provision shall not prevent
the earlier lapse of any conditions relating to the passage of time and
continued employment that would otherwise have lapsed during such period.
Performance or other conditions (other than conditions relating only to the
passage of time and continued employment) shall continue to apply unless
otherwise provided in the instrument evidencing the Awards or in any other
agreement between the Participant and the Company or unless otherwise agreed to
by the Committee.
(b) A "Change in Control" means: (i) the occurrence of an event that
would, if known to the Company's management, be required to be reported by the
Company under Item 1(a) of Form 8-K pursuant to the 1934 Act; or (ii) the
acquisition or receipt, in any manner, by any person (as defined for purposes of
the 1934 Act) or any group of persons acting in concert, of direct or indirect
beneficial ownership (as defined for purposes of the 1934 Act) of 20% or more of
the combined voting securities ordinarily having the right to vote for the
election of directors of the Company; or (iii) a change in the constituency of
the Board with the result that individuals (the "Incumbent Directors") who are
members of the Board on the Effective Date (as specified
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<PAGE>
in Section 9) cease for any reason to constitute at least a majority of the
Board, provided that any individual who is elected to the Board after the
Effective Date and whose nomination for election was unanimously approved by the
Incumbent Directors shall be considered an Incumbent Director beginning on the
date of his or her election to the Board; or (iv) the sale, exchange or other
disposition of all or a significant portion of the Company's business or assets,
or the execution by the Company of a binding agreement providing for such a
transaction.
(c) The provisions of Section 6.3(a) shall not apply to the extent
expressly determined by at least 75% of the Incumbent Directors at a duly
convened meeting of the Board held before the occurrence of a Change in
Control.
7. Grant and Acceptance of Awards
7.1 The Committee's approval of a grant of an Award under the Plan,
including the names of Participants and the size of the Award, including the
number of shares of Common Stock subject to the Award, shall be reflected in
minutes of meetings held by the Committee or the Board or in written consents
signed by members of the Committee or the Board. Once approved by the
Committee, each Award shall be evidenced by such written instrument, containing
such terms as are required by the Plan and such other terms, consistent with the
provisions of the Plan, as may be approved from time to time by the Committee.
7.2 Each instrument may be in the form of agreements to be executed by
both the Participant and the Company, or certificates, letters or similar
instruments, which need not be executed by the Participant but acceptance of
which shall evidence agreement to the terms thereof. The receipt of an Award
shall not impose any obligation on the Participant to Accept the Award.
7.3 Except as specifically provided by the Plan or the instrument
evidencing an Award, a Participant shall not become a stockholder of SunGard
until (i) the Participant makes any required payments in respect of the Common
Stock issued or issuable pursuant to the Award, (ii) the Participant furnishes
SunGard with any required agreements, certificates, letters or other
instruments, and (iii) the Participant actually receives the shares of Common
Stock. Subject to any terms and conditions imposed by the Plan or the
instrument evidencing an Award, upon the occurrence of all of the conditions set
forth in the immediately preceding sentence, a Participant shall have all rights
of a stockholder with respect to shares of Common Stock, including, but not
limited to, the right to vote such shares and to receive dividends and other
distributions paid with respect to such shares. The Committee may, upon such
conditions as it deems appropriate, provide that a Participant will receive a
benefit in lieu of cash dividends that would have been payable on any and all
Common Stock subject to the Participant's Award, had such Common Stock been
outstanding. Without limitation, the Committee may provide for payment to the
Participant of amounts representing such dividends, either currently or in the
future, or for the investment of such amounts on behalf of the Participant.
7.4 Notwithstanding any other provision of the Plan, the Company shall not
be obligated to deliver any shares of Common Stock pursuant to the Plan or to
remove any restriction from shares of Common Stock previously delivered under
the Plan (a) until all conditions to the Award have been satisfied or removed,
(b) until, in the opinion of SunGard's General Counsel, all applicable Federal
and state laws and regulations have been complied with, (c) if the outstanding
Common Stock is at the time listed on any stock exchange or included for
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quotation on an inter-dealer system, until the shares to be delivered have been
listed or included or authorized to be listed or included on such exchange or
system upon official notice of notice of issuance, (d) if it might cause the
Company to issue or sell more shares of Common Stock that the Company is then
legally entitled to issue or sell, and (e) until all other legal matters in
connection with the issuance and delivery of such shares have been approved by
SunGard's General Counsel. If the sale of Common Stock has not been registered
under the Securities Act of 1933, as amended, the Company may require, as a
condition to exercise of an Award, such representations or agreements as
SunGard's General Counsel may consider appropriate to avoid violation of such
Act and may require that the certificates evidencing such Common Stock bear an
appropriate legend restricting transfer. If an Award is exercised by the
Participant's legal representative, the Company shall be under no obligation to
deliver Common Stock pursuant to such exercise until the Company is satisfied as
to the authority of such representative.
8. Tax Withholding
The Company shall withhold from any cash payment made pursuant to an Award
an amount sufficient to satisfy all Federal, state and local withholding tax
requirements (the "withholding requirements"). In the case of an Award pursuant
to which Stock may be delivered, the Committee shall have the right to require
that the Participant or other appropriate person remit to the Company an amount
sufficient to satisfy the withholding requirements, or make other arrangements
satisfactory to the Committee with regard to such requirements, prior to the
delivery of any Common Stock. If and to the extent that such withholding is
required, the Committee may permit a Participant or such other person or entity
to elect at such time and in such manner as the Committee may determine to have
the Company hold back from the shares of Common Stock to be delivered, or to
deliver to the Company, Common Stock having a value calculated to satisfy the
withholding requirement. If at the time an ISO is exercised, the Committee
determines that the Company could be liable for withholding requirements with
respect to a disposition of the Common Stock received upon exercise, the
Committee may require as a condition of exercise that the person exercising the
ISO agree (a) to inform the Company promptly of any disposition (within the
meaning of section 424(c) of the Code) of Common Stock received upon exercise,
and (b) to give such security as the Committee deems adequate to meet the
potential liability of the Company for the withholding requirements and to
augment such security from time to time in any amount reasonably deemed
necessary by the Committee to preserve the adequacy of such security.
9. Stockholder Approval, Effective Date and Term of Plan
The Plan was adopted by the Board on February 15, 1994, subject to the
approval of SunGard's stockholders. The Plan shall be submitted to SunGard's
stockholders for approval at the Company's 1994 annual meeting of stockholders.
If such approval is not obtained at such meeting (or at any subsequent meeting
at which such approval is sought), then, at the discretion of the Board, this
Plan may be re-submitted to SunGard's stockholders for approval at any
subsequent annual meeting of stockholders or at any special meeting of
stockholders (including a special meeting that may be called solely for that
purpose). The Plan shall not become effective unless and until it is approved
by the affirmative vote of the holders of a majority of the outstanding shares
of the Company's Common Stock represented and entitled to vote at a duly
convened meeting of SunGard's stockholders. If this Plan is so approved by
SunGard's
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<PAGE>
stockholders, then the date of such approval shall be the effective date of this
Plan ("Effective Date"). No Award shall be granted more than ten years after
the Effective Date.
10. Effect, Amendment, Suspension and Termination
Neither adoption of the Plan nor the grant of Awards to a Participant will
affect the Company's right to grant to such Participant awards that are not
subject to the Plan, to issue to such Participant Common Stock as a bonus or
otherwise, or to adopt other plans or arrangements under which Common Stock may
be issued to Employees or other persons or entities. The Board reserves the
right, at any time and from time to time, to amend the Plan in any way, or to
suspend or terminate the Plan, effective as of the date specified by the Board
when it takes such action, which date may be before or after the date the Board
takes such action; provided that any such action shall not affect any Awards
granted before the actual date on which such action is taken by the Board; and
further provided that the approval of SunGard's stockholders shall be required
whenever necessary for the Plan to continue to satisfy the conditions of Rule
16b-3 under the 1934 Act, Section 422 of the Code with respect to the award of
ISO's (unless the Board determines that ISO's shall no longer be granted under
the Plan), any bylaw, rule or regulation of the market system or stock exchange
on which SunGard's Common Stock is then listed or admitted to trading, or any
other applicable law, rule or regulation.
11. Other Provisions
11.1 Nothing contained in the Plan or any Award shall confer upon any
Employee or other Participant the right to continue in the employ of, or to
continue to provide service to, the Company or any affiliated corporation, or
interfere in any way with the right of the Company or any affiliated corporation
to terminate the employment or service of any Employee or other Participant for
any reason.
11.2 Corporate action constituting an offer by SunGard of Common Stock to
any Participant under the terms of an Award shall be deemed completed as of the
date of grant of the Award, regardless of when the instrument, certificate, or
letter evidencing the Award is actually received or accepted by the Participant.
11.3 None of a Participant's rights under any Award or under the Plan may
be assigned or transferred in any manner other than by will or under the laws or
descent and distribution. The foregoing shall not, however, restrict a
Participant's rights with respect to Unrestricted Stock or the outright transfer
of cash, nor shall it restrict the ability of a Participant's heirs, estate,
beneficiaries, or personal or legal representatives to enforce the terms of the
Plan with respect to Awards granted to the Participant.
11.4 The Plan, and all Awards granted hereunder, shall be governed by and
construed in accordance with the laws of the Commonwealth of Pennsylvania. The
headings of the Sections of the Plan are for convenience of reference only and
shall not affect the interpretation of the Plan. All pronouns and similar
references in the Plan shall be construed to be of such number and gender as the
context requires or permits. If any provision of the Plan is determined to be
unenforceable for any reason, then that provision shall be deemed to have been
deleted
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<PAGE>
or modified to the extent necessary to make it enforceable, and the remaining
provisions of the Plan shall be affected.
11.5 All notices with respect to the Plan shall be in writing and shall be
hand delivered or sent by certified mail or reputable overnight delivery
service, expenses prepaid. Notices to the Company or the Committee shall be
delivered or sent to SunGard's headquarters to the attention of its General
Counsel. Notices to any Participant or holder of shares of Common Stock issued
pursuant to an Award shall be sufficient if delivered or sent to such person's
address as it appears in the regular records of the Company or its transfer
agent.
11.6 If there is any change in the capitalization of the Company, such as
by stock dividend, stock split, combination of shares, exchange of securities,
recapitalization or other event which the Committee deems, in its sole
discretion, to be similar circumstances, the Committee may make such adjustments
to the number and/or kind of shares of stock or securities subject to Awards
then outstanding or subsequently granted, any exercise prices relating to such
Awards and any other provision of such Awards affected by such change, as the
Committee may determine in its sole discretion. The Committee may also make
such adjustments to take into account material changes in law or in accounting
practices or principles, mergers, consolidations, acquisitions, dispositions or
similar corporate transactions, or any other event, as the Committee may
determine in its sole discretion.
11.7 The Committee may agree at any time, upon request of a Participant, to
defer the date on which any payment under an Award shall be made.
11.8 In any case that a Participant purchases Common Stock under an Award
for a price equal to the par value of the Common Stock, the Committee may
determine, in its sole discretion, that such price has been satisfied by past
services rendered by the Participant.
11.9 For the purposes of the Plan and any Award granted hereunder, unless
otherwise determined by the Committee, the term "fair market value" of Common
Stock on a specified date shall mean the last sale price for one share of Common
Stock on the last trading day on or before the specified date, as reported on
the National Association of Securities Dealers Automated Quotation
System/National Market System, or on such other market system or stock exchange
on which SunGard's Common Stock is then listed or admitted to trading, or, if
the foregoing does not apply, the market value determined by the Committee.
THE UNDERSIGNED CERTIFIES THAT THIS PLAN WAS DULY APPROVED BY THE
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS OF SUNGARD DATA SYSTEMS INC.,
AND WAS DULY ADOPTED BY THE BOARD OF DIRECTORS OF SUNGARD DATA SYSTEMS INC.,
AT MEETINGS DULY HELD ON THE FIFTEENTH DAY OF FEBRUARY, 1994.
/s/ Lawrence A. Gross
---------------------------------------
LAWRENCE A. GROSS, SECRETARY
OF SUNGARD DATA SYSTEMS INC.
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