8-KLeadership Changes

WESTERN DIGITAL CORP 8-K Report, Executive Changes (Feb 19, 2013)

Filed February 19, 2013For Securities:WDC

Summary

This 8-K filing by Western Digital Corp. (WDC) on February 19, 2013, reports on the establishment of performance goals for cash bonus awards under the company's Incentive Compensation Plan (ICP) for the six-month period ending June 28, 2013. The Compensation Committee has set specific financial metrics, including earnings per share (EPS) for the CEO and CFO, and operating income for other named executive officers, as the basis for these bonuses. Performance against these goals, along with other discretionary factors like strategic objectives and business conditions, will determine the payout percentage, which can range from 0% to 200% of the target bonus. Investors should note that this filing details the framework for executive compensation tied to company performance. The use of EPS and operating income as key performance indicators suggests a focus on profitability and operational efficiency. The potential for bonuses to be significantly influenced by company and individual performance, as well as market conditions, is a key takeaway for understanding executive incentives during this period.

Key Highlights

  • 1Western Digital (WDC) established performance goals for executive cash bonuses under the Incentive Compensation Plan (ICP).
  • 2The performance period for these bonuses is the six months from December 29, 2012, to June 28, 2013.
  • 3Earnings per share (EPS) is the selected financial performance goal for the CEO and CFO.
  • 4Operating income is the selected financial performance goal for other named executive officers.
  • 5Bonus payouts are contingent on achieving specific EPS and operating income targets, with a range of 0% to 200% of the target bonus.
  • 6Performance goals are supplemented by discretionary factors, including non-financial strategic objectives, business/industry conditions, and individual/business group performance.
  • 7Target bonuses for executive officers range from 85% to 150% of their semi-annual base salary.

Frequently Asked Questions

The main purpose of this 8-K filing is to disclose the establishment of specific performance goals for cash bonus awards under Western Digital's Incentive Compensation Plan (ICP) for a six-month period ending June 28, 2013. This impacts the compensation of executive officers and certain other employees.

The financial metrics for determining executive bonuses are earnings per share (EPS) for the Chief Executive Officer and Chief Financial Officer, and operating income for other named executive officers. These metrics are tied to achieving specific goals that can result in bonus payouts ranging from 0% to 200% of the target award.

No, while financial performance metrics like EPS and operating income are key, the bonuses are also influenced by other discretionary factors. These include the company's achievement of non-financial and strategic operating objectives, changes in business and industry conditions, and the individual and business group's performance. The Compensation Committee retains discretion in determining the final bonus amount.

The Compensation Committee has previously approved target bonuses for executive officers expressed as a percentage of their semi-annual base salary. These target bonuses currently range from 85% to 150%.