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MICROSOFT CORP 8-K Report, Material Agreement (Sep 28, 2005)

Filed September 28, 2005For Securities:MSFT

Summary

This SEC Form 8-K filing from Microsoft Corporation, dated September 28, 2005, details two key events: a realignment of the company's business structure and adjustments to executive compensation. The company announced the formation of three new divisions, with specific executives appointed to lead each. Notably, James Allchin, co-President of the Platform Products & Services Division, announced his intention to retire at the end of 2006, following the release of Windows Vista. Concurrently, Microsoft reported increases in the annual salaries and cash bonuses for several key executives, including CEO Steve Ballmer and Chief Software Architect Bill Gates. These compensation adjustments reflect the company's annual performance review process and set bonus targets for fiscal year 2006, with executives eligible for bonuses up to 120% of their salaries. Investors should note these executive changes and compensation decisions as they can signal leadership transitions and management's view on performance and future incentives.

Key Highlights

  • 1Microsoft announced a significant corporate realignment into three new divisions: Platform Products & Services, Business, and Entertainment & Devices.
  • 2Key executives were appointed to lead these new divisions, including James Allchin and Kevin Johnson (co-Presidents, Platform Products & Services), Jeff Raikes (President, Business), and Robbie Bach (President, Entertainment & Devices).
  • 3James Allchin, a long-standing executive, announced his planned retirement for the end of calendar year 2006, post-Windows Vista release.
  • 4The company increased the annual salaries for top executives, including CEO Steve Ballmer and Chief Software Architect Bill Gates, to $620,000 each.
  • 5Cash bonuses were awarded to key executives for fiscal year 2005 performance, with amounts varying by individual.
  • 6For fiscal year 2006, executives are eligible for annual cash bonuses ranging from 0% to 120% of their eligible salary.
  • 7The filing confirms that the employment of these executive officers is at-will.

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