8-KMaterial Agreements

WESTERN DIGITAL CORP 8-K Report, Material Agreement (Jun 23, 2006)

Filed June 23, 2006For Securities:WDC

Summary

This 8-K filing from Western Digital Corp. (WDC) on June 23, 2006, announces the establishment of performance goals for its Incentive Compensation Plan (ICP Plan) for the first half of fiscal year 2007. The compensation committee has determined that bonus awards will be contingent upon achieving specific revenue and earnings per share (EPS) targets, with varying combinations of these metrics determining the funding level of the plan. Executive officers and other key employees are eligible for cash bonuses. The target bonus for executive officers is set as a percentage of their base salary, ranging from 65% to 100%. The actual payout, however, can range from 0% to 200% of the target bonus, depending on the company's performance against the established revenue and EPS goals. Individual performance may also influence the final award amount.

Key Highlights

  • 1Establishment of performance-based cash bonus goals for the first half of fiscal year 2007 under the ICP Plan.
  • 2Bonus funding is tied to achieving specific revenue and earnings per share (EPS) targets.
  • 3Executive officers' target bonus ranges from 65% to 100% of base salary.
  • 4Potential payout for the ICP Plan can range from 0% to 200% of the target bonus.
  • 5Individual performance will also impact actual bonus awards.
  • 6The Compensation Committee of the Board of Directors set these performance goals on June 20, 2006.

Frequently Asked Questions

The primary purpose of this 8-K filing is to inform investors about the performance metrics and targets that have been set for Western Digital Corporation's (WDC) Incentive Compensation Plan (ICP Plan) for the first half of fiscal year 2007.

Executive bonuses will be determined by the company's achievement of pre-established revenue and earnings per share (EPS) targets. The funding of the bonus pool can range from 0% to 200% of the target bonus, and individual awards may be further adjusted based on individual performance.

For executive officers, the target bonus amount is set as a percentage of their base salary, ranging from 65% to 100%.

The performance goals for the ICP Plan were established by the Compensation Committee of the Board of Directors on June 20, 2006.