8-KEarnings & ResultsLeadership ChangesMaterial Agreements+1

WESTERN DIGITAL CORP 8-K Report, Material Agreement (Nov 2, 2006)

Filed November 2, 2006For Securities:WDC

Summary

Western Digital Corporation (WDC) announced a significant leadership transition and provided an update on its financial performance in this 8-K filing. Effective January 2, 2007, John Coyne, currently President and Chief Operating Officer, will assume the role of Chief Executive Officer. This transition is formalized through a new employment agreement detailing Mr. Coyne's compensation, including a base salary of $800,000, performance-based cash awards, restricted stock units, and stock options. Concurrently, Arif Shakeel will relinquish his CEO duties but will remain with the company as a Special Advisor to the CEO through June 29, 2007, receiving his current salary of $800,000 during this period. This leadership change signals a strategic shift and continuity in operational expertise. In addition to the executive changes, Western Digital also reported its financial results for the first fiscal quarter ended September 29, 2006. While the filing references press releases and an investor information summary for detailed financial figures (Exhibits 99.2 and 99.3), it does not include the specific numbers within the 8-K text itself. Investors should refer to these accompanying exhibits for a comprehensive understanding of the company's financial condition and operational performance.

Key Highlights

  • 1John Coyne appointed as the new Chief Executive Officer, effective January 2, 2007.
  • 2Arif Shakeel transitions from CEO to Special Advisor to the CEO role through June 29, 2007.
  • 3Coyne's employment agreement includes an $800,000 annual base salary starting January 2, 2007.
  • 4Coyne is eligible for significant performance-based cash awards and stock unit grants, including 1,100,000 restricted stock units vesting over several years and a nonqualified stock option for 120,000 shares.
  • 5Shakeel will continue to receive his current $800,000 annual base salary in his advisory role.
  • 6Part of Shakeel's restricted stock awards and some stock options scheduled to vest after June 29, 2007, were terminated.
  • 7The filing references the company's first fiscal quarter financial results ended September 29, 2006, with detailed information available in accompanying exhibits.

Frequently Asked Questions

John Coyne, currently President and Chief Operating Officer, will become the new Chief Executive Officer effective January 2, 2007. Arif Shakeel will step down as CEO but will remain with the company as a Special Advisor to the CEO until June 29, 2007.

Mr. Coyne's agreement includes a base salary of $800,000 annually starting January 2, 2007, eligibility for significant performance-based cash awards (target of $1,000,000 for two awards and a minimum target of $2,000,000 annually thereafter), a grant of 1,100,000 restricted stock units, and a stock option to purchase 120,000 shares.

Mr. Shakeel will serve as Special Advisor to the CEO through June 29, 2007. He will continue to receive his current annual base salary of $800,000 during this period. Some of his previously scheduled restricted stock and stock options were terminated as part of this amendment.

The filing states that financial results for the first fiscal quarter ended September 29, 2006, were announced on November 2, 2006. Detailed information is available in the press release (Exhibit 99.2) and the Investor Information Summary (Exhibit 99.3) attached to this 8-K filing.