SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, For Use of the
[X] Definitive Proxy Statement Commission Only (as permitted
[_] Definitive Additional Materials by Rule 14a-6(e)(2))
[_] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
COMPUWARE CORPORATION
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
________________________________________________________________________________
1) Title of each class of securities to which transaction applies:
________________________________________________________________________________
2) Aggregate number of securities to which transaction applies:
________________________________________________________________________________
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
________________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
________________________________________________________________________________
5) Total fee paid:
[_] Fee paid previously with preliminary materials:
________________________________________________________________________________
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
1) Amount previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
(SC14A-07/98)
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COMPUWARE CORPORATION
Corporate Headquarters
31440 NORTHWESTERN HIGHWAY, FARMINGTON HILLS, MICHIGAN 48334-2564 [LOGO]
(248) 737-7300
January 29, 1999
Dear Compuware Shareholder:
You are cordially invited to attend a Special Meeting of Shareholders of
Compuware Corporation to be held at 3:00 p.m., Eastern Standard Time on
Thursday, February 25, 1999. The meeting will be held at Compuware's corporate
offices, 31440 Northwestern Highway, Farmington Hills, Michigan.
The following pages contain the formal Notice of the Special Meeting and
the Proxy Statement. You may wish to review this material for information
concerning the business to be conducted at the meeting.
If your shares are currently held in the name of your broker, bank or other
nominee and you wish to attend the meeting, you should obtain a letter from your
broker, bank or other nominee indicating that you are the beneficial owner of a
stated number of shares of stock as of the January 26, 1999 record date. This
will help facilitate registration at the meeting.
Your vote is important. Whether you plan to attend the meeting or not, we
urge you to complete, sign and return your proxy card as soon as possible. This
will ensure representation of your shares in the event you are unable to attend
the meeting. You may, of course, revoke your proxy and vote in person at the
meeting if you so desire.
Sincerely,
/s/ Peter Karmanos, Jr.
Peter Karmanos, Jr.
Chairman & Chief Executive Officer
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COMPUWARE CORPORATION
31440 Northwestern Highway
Farmington Hills, Michigan 48334-2564
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To the Shareholders:
Please take notice that a Special Meeting of Shareholders of Compuware
Corporation (the "Company") will be held at the Company's corporate offices at
31440 Northwestern Highway, Farmington Hills, Michigan 48334-2564 on Thursday,
February 25, 1999 at 3:00 p.m., Eastern Standard Time, to consider and act upon
the following matters:
(1) The amendment of the Company's Restated Articles of Incorporation to
increase the number of authorized shares of the Company's Common
Stock, $0.01 par value, from 400,000,000 shares to 1,600,000,000
shares.
(2) Such other business as may properly come before the meeting.
Only shareholders of record at the close of business on January 26, 1999
will be entitled to vote at the meeting.
Your attention is called to the attached Proxy Statement and the
accompanying proxy card. You are requested to sign and return the proxy card in
the enclosed envelope. If you attend the meeting, you may withdraw your proxy
and vote your shares.
By Order of the Board of Directors,
/s/ Thomas Costello, Jr.
Thomas Costello, Jr.
Secretary
Farmington Hills, Michigan
January 29, 1999
<PAGE>
PROXY STATEMENT
FOR
SPECIAL MEETING OF SHAREHOLDERS
OF
COMPUWARE CORPORATION
INTRODUCTION
This Proxy Statement and the accompanying proxy card are first being mailed
on or about January 29, 1999, to shareholders of record on January 26, 1999 of
Compuware Corporation ("Compuware" or the "Company") in connection with the
solicitation by the Company's Board of Directors of proxies from holders of
Compuware Common Stock, $.01 par value per share ("Common Stock"), for use at
the Special Meeting of Shareholders to be held at 3:00 p.m., Eastern Standard
Time, on Thursday, February 25, 1999, at Compuware Corporation, 31440
Northwestern Highway, Farmington Hills, Michigan 48334-2564, and at any
adjournment or adjournments thereof.
We urge you to sign, date and mail your proxy card promptly to make certain
that your shares will be voted at the meeting.
A proxy given pursuant to this solicitation may be revoked at any time
before it is voted by filing with the Secretary of Compuware a written notice of
revocation bearing a date later than the proxy, by duly executing a subsequent
proxy relating to the same shares and delivering it to the Secretary of
Compuware, or by attending the Special Meeting and voting in person. Attendance
at the Special Meeting will not in and of itself operate to revoke a proxy. Any
written notice of revocation should be sent to: Secretary, Compuware
Corporation, 31440 Northwestern Highway, Farmington Hills, Michigan 48334-2564.
The principal executive offices of Compuware are located at 31440
Northwestern Highway, Farmington Hills, Michigan 48334-2564, and the telephone
number is (248)737-7300.
GENERAL INFORMATION
The expense of soliciting proxies, including the cost of preparing,
printing and mailing the Notice of the Special Meeting of Shareholders, the
Proxy Statement and the accompanying proxy card, will be borne by the Company.
In addition to the use of the mails, proxies may be solicited by personal
interview, telephone or telegraph, by directors, officers and regular employees
of the Company, without special compensation therefor. The Company has also
retained Corporate Investor Communications, Inc., 111 Commerce Road, Carlstadt,
New Jersey 07072-2586 to assist in the solicitation of proxies, for an
approximate cost of $5,500, plus reasonable expenses. Brokers and other persons
holding stock in their names, or in the names of nominees, will be requested to
forward proxy material to the beneficial owners of the stock and to obtain
proxies, and the Company will defray reasonable expenses incurred in forwarding
such material.
Holders of shares of Common Stock of record at the close of business on
January 26, 1999 are entitled to notice of, and to vote at the Special Meeting
of Shareholders. There are outstanding on January 26, 1999, 185,208,256 shares
of Common Stock, the only class of stock
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outstanding. Each share is entitled to one vote. The presence, in person or by
proxy, of the holders of record of a majority of the outstanding shares of
Common Stock, or 92,604,129 shares, is necessary to constitute a quorum for the
transaction of business at the meeting or at any adjournment thereof.
All proxies signed and returned to the Company will be voted, if not
otherwise specified thereon, for approval of the proposal to amend the Company's
Restated Articles of Incorporation described herein.
Management of the Company knows of no other matters to come before the
Special Meeting. If any other matters requiring a shareholder vote properly come
before the meeting, the persons appointed proxy on the enclosed proxy card will
vote with respect to such matters in accordance with their best judgment.
PROPOSED AMENDMENT TO ARTICLES OF INCORPORATION TO INCREASE
AUTHORIZED COMMON STOCK
Article III(1) of the Company's Restated Articles of Incorporation
presently provides for an authorized capitalization of the Company of
400,000,000 shares of Common Stock, $0.01 par value per share, and 5,000,000
shares of Class A Preferred Stock, no par value. As of January 26, 1999, none of
the shares of Class A Preferred Stock were issued and outstanding, and
185,208,256 shares of Common Stock were issued and outstanding with a total of
39,193,567 additional shares of Common Stock reserved for issuance upon exercise
of stock options granted and available for grant under the Company's stock
option plans or upon purchase under the Company's employee stock purchase plan.
The Board of Directors of the Company has proposed an amendment to Article
III(1) of the Company's Restated Articles of Incorporation to increase, from
400,000,000 to 1,600,000,000, the number of authorized shares of Common Stock. A
copy of Article III(1) showing the proposed amendment is set forth in Exhibit A.
If the proposal is approved by the shareholders of the Company, the
additional 1,200,000,000 shares of Common Stock so authorized will be available
for issuance by the Board of Directors of the Company for stock splits or stock
dividends, acquisitions, raising additional capital, stock options or other
corporate purposes. On January 6, 1999, the Board of Directors of the Company
approved a two-for-one stock split, to be affected by means of a 100% stock
dividend, to be payable on February 26, 1999 to holders of record of the
Company's Common Stock as of January 26, 1999, subject to the approval of this
proposal by the Company's shareholders.
The Company does not anticipate that it would seek authorization from the
shareholders for issuance of any other additional shares in the future unless
required by applicable law or regulation. Any additional shares, when issued,
would have the same rights and preferences as the shares of Common Stock
presently outstanding. There are no preemptive rights available to shareholders
in connection with the issuance of any such shares.
One of the effects of the amendment, if adopted, may be to enable the Board
to render it more difficult to, or discourage an attempt to, obtain control of
the Company by means of a merger, tender offer, proxy contest or otherwise, and
thereby protect the continuity of present management. The Board would, unless
prohibited by applicable law, have additional shares of
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Common Stock available to effect transactions (including private placements) in
which the number of the Company's outstanding shares would be increased and
would thereby dilute the interest of any party attempting to gain control of the
Company. Such action, however, could discourage an acquisition of the Company
which shareholders might view as desirable. In addition, since the Company's
shareholders have no preemptive rights to purchase additional shares of Common
Stock issued, the issuance of such shares could dilute the interests of current
shareholders of the Company.
The approval of this proposal to amend the Company's Restated Articles of
Incorporation to increase the number of authorized shares of Common Stock
requires the affirmative vote of the holders, as of the record date, of the
majority of the outstanding shares of Common Stock. Abstentions and broker
non-votes will not be deemed affirmative votes, and will have the same effect as
a negative vote on the proposal. Such votes, however, will be counted in
determining whether a quorum is present. THE BOARD OF DIRECTORS RECOMMENDS A
VOTE FOR THE APPROVAL OF THE AMENDMENT TO ARTICLE III(1) OF THE COMPANY'S
ARTICLES OF INCORPORATION.
SECURITY OWNERSHIP OF MANAGEMENT
The following table shows as of January 26, 1999 the beneficial ownership
of Compuware Common Stock by each current director, by each executive officer,
and by all directors and executive officers as a group.
<TABLE>
<CAPTION>
Beneficial Percent
Name Ownership(1) of Class
---- ------------ --------
<S> <C> <C>
Thomas Costello, Jr. 73,295(2) *
Stephen H. Fagan 477,608(3) *
Laura Lawson Fournier 51,981(4) *
Henry A. Jallos 272,179(5) *
Peter Karmanos, Jr. 20,752,344(6) 11.1
Denise A. Knobblock 92,440(7) *
Joseph A. Nathan 889,865(8) *
W. James Prowse 1,574,059(9) *
Phyllis Recca 137,347(10) *
John N. Shevillo 81,455(11) *
Eliot R. Stark 202,351(12) *
Elizabeth A. Chappell 12,000(13) *
Elaine K. Didier 10,500(14) *
Bernard M. Goldsmith 134,714(15) *
William O. Grabe 75,000(16) *
William R. Halling 27,000(17) *
G. Scott Romney 76,000(18) *
Thomas Thewes 5,213,796(19) 2.8
Lowell Weicker, Jr. 1,000(20) *
By all executive officers and directors as a group (19 persons) 22,477,214 11.9
Massachusetts Financial Services 18,628,000(21) 10.1
Putnam Investment Management 17,645,000(22) 9.5
</TABLE>
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* Less than one percent.
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(1) Except as otherwise noted, each beneficial owner identified in this table
has sole investment power with respect to the shares shown in the table to
be owned by the person or entity.
(2) Includes (i) 1,613 shares owned directly by Mr. Costello; (ii) 36,082
shares held for Mr. Costello through the Company's ESOP; (iii) 400 shares
held by Mr. Costello's children; and (iv) 35,200 option shares which are
fully vested.
(3) Includes (i) 2,239 shares owned directly by Mr. Fagan; (ii) 269 shares held
for Mr. Fagan through the Company's ESOP; and (iii) 475,100 option shares
which are fully vested.
(4) Includes (i) 6,230 shares owned directly by Ms. Fournier; (ii) 9,483 shares
held for Ms. Fournier through the Company's ESOP; and (iii) 36,268 option
shares which are fully vested.
(5) Includes (i) 2,389 shares owned directly by Mr. Jallos; (ii) 16,615 shares
held for Mr. Jallos through the Company's ESOP; and (iii) 253,175 option
shares which are fully vested.
(6) Includes (i) 2,269,148 shares owned directly by Mr. Karmanos; (ii) 261,524
shares held by Mr. Karmanos's trusts; (iii) 5,605,601 shares held by Mr.
Karmanos's Stock Limited Partnership; (iv) 11,113,303 shares Mr. Karmanos
is entitled to vote pursuant to shareholder agreements with certain
shareholders; (v) 188,802 shares held for Mr. Karmanos through the
Company's ESOP; (vi) 522,966 shares held by Mr. Karmanos's wife (under
voting agreement, dated July 1, 1997); and (vii) 790,800 option shares
which are fully vested. The shareholder group referenced in (iv) above
includes shares beneficially owned by (a) Thomas Thewes and the Thewes
entities, Michael J. Lobsinger, W. James Prowse, Joseph A. Nathan, Allen B.
Cutting Trust, Joan L. Cutting Trust, Allen B. Cutting Foundation, Cutting
Irrevocable Trust, Long Family Trust, Long Family Charitable Remainder
Unitrust, William D. and Kay K. Long Charitable Remainder Unitrust, Harris
Trust and Harris Family Charitable Remainder Unitrust (under a shareholder
agreement, dated November 5, 1992, as amended) and (b) General Atlantic
Partners II, L.P., General Atlantic Partners, LLC, and GAP-Amsterdam
Partners, L.P. (under a shareholder agreement, dated October 22, 1992).
(7) Includes (i) 739 shares owned directly by Ms. Knobblock; (ii) 11,701 shares
held for Ms. Knobblock through the Company's ESOP; and (iii) 80,000 option
shares which are fully vested.
(8) Includes (i) 70,066 shares owned directly by Mr. Nathan; (ii) 91,527 shares
held for Mr. Nathan through the Company's ESOP; and (iii) 728,272 shares
which are fully vested.
(9) Includes (i) 879,139 shares held by Mr. Prowse's trust; (ii) 136,120 shares
held for Mr. Prowse through the Company's ESOP; and (iii) 558,800 option
shares which are fully vested.
(10) Includes (i) 14,703 shares held directly by Ms. Recca; (ii) 8,532 shares
held for Ms. Recca through the Company's ESOP; (iii) 18,580 shares held for
Ms. Recca through an IRRA; and (iv) 95,532 option shares which are fully
vested.
(11) Includes (i) 2,497 shares held directly by Mr. Shevillo; (ii) 38,958 shares
held for Mr. Shevillo through the Company's ESOP; and (iii) 40,000 option
shares which are fully vested.
(12) Includes (i) 2,351 shares held directly by Mr. Stark; and (ii) 200,000
option shares which are fully vested.
(13) Includes (i) 2,000 shares held directly by Ms. Chappell; and (ii) 10,000
option shares which are fully vested.
(14) Includes (i) 1,300 shares held directly by Ms. Didier; and (ii) 9,200
option shares which are fully vested.
(15) Includes (i) 19,714 shares owned directly by Mr. Goldsmith; and (ii)
115,000 option shares which are fully vested.
(16) Includes 75,000 option shares which are fully vested.
(17) Includes (i) 2,000 shares held directly by Mr. Halling; and (ii) 25,000
option shares which are fully vested.
(18) Includes (i) 5,119 shares owned directly by Mr. Romney; (ii) 1,000 shares
owned by Mr. Romney's wife; and (iii) 69,881 option shares which are fully
vested.
(19) Includes (i) 5,019,590 shares held by Mr. Thewes's trusts; (ii) 20,000
shares held by The Thewes Family Limited Partnership; (iii) 48,750 shares
held by The Thewes GST Limited Partnership; (iv) 118,136 shares held for
Mr. Thewes through an IRRA; and (v) 7,320 option shares which are fully
vested.
(20) Includes 400 shares held by Mr. Weicker; and (ii) 600 shares held by Mr.
Weicker's wife.
(21) The address for Massachusetts Financial services is 500 Boylston Street,
25th Floor, Boston, Massachusetts 02116.
(22) The address for Putnam Investment Management is One Post Office Square,
Boston, Massachusetts 02109.
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SHAREHOLDER PROPOSALS
Shareholders may submit proposals to be considered for shareholder action
at the 1999 Annual Meeting if they do so in accordance with the appropriate
regulations of the Securities and Exchange Commission. Any such proposals must
be submitted to the Company's Secretary no later than March 31, 1999.
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EXHIBIT A
AMENDMENT TO ARTICLE III(1)
OF THE ARTICLES OF INCORPORATION
OF COMPUWARE CORPORATION
1. The total authorized capital stock is:
Common Shares: 1,600,000,000 shares, Common Stock, $0.01 Par Value
Preferred Shares: 5,000,000 shares, Class A Preferred Stock, No Par Value
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|X| PLEASE MARK VOTES
AS IN THIS EXAMPLE
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
- ---------------------------- 1. Amend Company's Restated Articles For Against Abstain
COMPUWARE CORPORATION of Incorporation to increase the
- ---------------------------- number of authorized shares of the |_| |_| |_|
Company's Common Stock $0.01 par
value, from 400,000,000 shares to
1,600,000,000 shares.
</TABLE>
RECORD DATE SHARES:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
------------
Please be sure to sign and date this Proxy. Date
- ------------------------------------------------------------------ Mark box at right if address change or
comments have been noted on the |_|
reverse side of this card.
- --------Shareholder sign here---------------Co-owner sign here----
</TABLE>
DETACH CARD DETACH CARD
COMPUWARE CORPORATION
Dear Shareholder,
The enclosed proxy card relates to the February 25, 1999 Special Meeting of
Shareholders of Compuware Corporation. Also enclosed is a Notice of Meeting and
a Proxy Statement.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
Please mark the boxes on the proxy card to indicate how your shares will be
voted. Then sign the card, detach it and return your proxy card in the enclosed
postage paid envelope.
Your vote must be received prior to the Special Meeting of Shareholders on
February 25, 1999.
Thank you in advance for your prompt consideration of this matter.
Sincerely,
Compuware Corporation
<PAGE>
COMPUWARE CORPORATION
The undersigned hereby appoints as proxies, Thomas Costello, Jr. or Barbara J.
Kovach, with power of substitution, to vote the shares of Common Stock which the
undersigned is entitled to vote at the Special Meeting of Shareholders of
Compuware Corporation, to be held on February 25, 1999 and at any adjournment(s)
thereof.
The Proxy will vote your shares in accordance with your directions on this card.
If you do not indicate your choices on this card, the Proxy will vote your
shares FOR the proposal.
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PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY USING THE ENCLOSED
ENVELOPE.
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Please sign exactly as your name(s) appear(s) on the books of the Company. Joint
owners should each sign personally. Trustees, custodians, and other fiduciaries
should indicate the capacity in which they sign, and where more than one name
appears, a majority must sign. If shareholder is a corporation, the signature
should be that of any authorized officer who should indicate his or her title.
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HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
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