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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): AUGUST 25, 2005
WESTERN DIGITAL CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 001-08703 33-0956711
(State or Other Jurisdiction of (Commission File Number) I.R.S. Employer
Incorporation or Organization) Identification No.)
20511 Lake Forest Drive
Lake Forest, California 92630
(Address of Principal Executive Offices) (Zip Code)
(949) 672-7000
(Registrant's Telephone Number, Including Area Code)
NOT APPLICABLE
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR
240.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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Item 1.01 Entry into a Material Definitive Agreement.
On August 25, 2005, Western Digital Corporation ("Western
Digital") entered into (i) an Employment Agreement with Arif Shakeel (the
"Shakeel Employment Agreement"), pursuant to which Mr. Shakeel will become Chief
Executive Officer of Western Digital, effective October 1, 2005, and (ii) an
Employment Agreement with Matthew E. Massengill (the "Massengill Employment
Agreement"), pursuant to which Mr. Massengill will relinquish the role of Chief
Executive Officer of Western Digital, effective October 1, 2005, and will
continue to serve as Chairman of the Board of Directors.
Pursuant to the Shakeel Employment Agreement, a copy of which
is attached hereto as Exhibit 10.1 and incorporated herein by reference, Mr.
Shakeel will continue to serve as President and Chief Operating Officer until
September 30, 2005. Effective October 1, 2005, Mr. Shakeel will become Chief
Executive Officer and President. The Shakeel Employment Agreement runs through
January 1, 2008, subject to certain termination provisions.
The Shakeel Employment Agreement provides for Mr. Shakeel to
receive base salary at the annual rate of $700,000 until October 1, 2005, at
which time the annual rate of Mr. Shakeel's base salary will increase to
$800,000. Mr. Shakeel's target annual bonus will be 100% of his base salary, and
he will be entitled to participate in Western Digital's other benefit plans on
terms consistent with those generally applicable to Western Digital's other
senior executives.
Pursuant to the agreement, Mr. Shakeel has been granted an
award of 1,250,000 restricted shares of Western Digital's common stock. Subject
to Mr. Shakeel's continued employment by Western Digital, 500,000 of these
restricted shares will vest on January 1, 2007, and the remaining 750,000 of
these restricted shares will vest on January 1, 2008. Mr. Shakeel's outstanding
stock options and restricted shares, to the extent that such options and such
restricted shares were scheduled to vest after December 31, 2007, have been
cancelled pursuant to the agreement. Also pursuant to the agreement, the entire
performance share award granted to Mr. Shakeel on or about January 20, 2005, has
been cancelled.
If Western Digital terminates Mr. Shakeel's employment other
than for cause (as defined in the agreement) prior to January 1, 2008, Mr.
Shakeel will be entitled to (i) a lump sum cash payment equal to his base salary
and target bonus for the period between the date his employment terminates and
January 1, 2008, and (ii) accelerated vesting of any and all options and other
equity-based awards granted by Western Digital that are then outstanding and not
otherwise fully vested, but only to the extent such awards were otherwise
scheduled to vest before January 1, 2008.
Pursuant to the Massengill Employment Agreement, a copy of
which is attached hereto as Exhibit 10.2 and incorporated herein by reference,
Mr. Massengill will continue to serve as Chairman of the Board and Chief
Executive Officer until September 30, 2005. Effective October 1, 2005, Mr.
Massengill will relinquish the role of Chief Executive Officer and will continue
employment as Chairman of the Board or in such other executive capacity as may
be assigned by the Board. Mr. Massengill's duties as Chairman of the Board will
include offering assistance to Mr. Shakeel in his new position as Chief
Executive Officer and coordinating investor communications. The Massengill
Employment Agreement runs through January 1, 2007, subject to certain
termination provisions.
The Massengill Employment Agreement provides for Mr.
Massengill to continue to receive base salary at his current annual rate of
$800,000. Mr. Massengill's target annual bonus will be 100% of his base salary,
and he will be entitled to participate in Western Digital's other benefit plans
on terms consistent with those generally applicable to Western Digital's other
senior executives.
Mr. Massengill's outstanding stock options and restricted
shares, to the extent that such options and such restricted shares were
scheduled to vest after July 31, 2007, have been cancelled pursuant to the
agreement. Provided that Mr. Massengill remains employed by Western Digital
through January 1, 2007, any of his outstanding stock options and any of his
restricted shares that are scheduled to vest after January 1, 2007 and on or
before July 31, 2007 will accelerate and become vested on January 1, 2007. With
respect to the accelerated options, Mr. Massengill will have until the later of
(i) January 1, 2010, or (ii) the time the options would have otherwise expired
or been terminated in accordance with the termination of employment rules
otherwise applicable to the options (but in no event later than the expiration
date of the options) to exercise those options. Also pursuant to the agreement,
the entire performance share award granted to Mr. Massengill on or about January
20, 2005, has been cancelled.
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If Western Digital terminates Mr. Massengill's employment
other than for cause (as defined in the agreement) prior to January 1, 2007, Mr.
Massengill will be entitled to (i) a lump sum cash payment equal to his base
salary and target bonus for the period between the date his employment
terminates and January 1, 2007, and (ii) accelerated vesting of any and all
options and other equity-based awards granted by Western Digital that are then
outstanding and not otherwise fully vested, but only to the extent such awards
were otherwise scheduled to vest on or before July 31, 2007.
ITEM 5.02 DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF
DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS.
Effective October 1, 2005, Arif Shakeel, age 50, currently
Western Digital's President and Chief Operating Officer, will become Western
Digital's Chief Executive Officer and President. In connection with Mr.
Shakeel's appointment, Western Digital and Mr. Shakeel entered into the Shakeel
Employment Agreement, dated as of August 25, 2005, as described under Item 1.01
of this Form 8-K. Such description is incorporated herein by reference.
Mr. Shakeel has been a director of Western Digital since
September 2004. Mr. Shakeel joined Western Digital in 1985 as Product Manager,
Integrated Drive Electronics. He served in various executive capacities,
including Vice President, Materials -- Asia, until October 1997. Mr. Shakeel
became Senior Vice President of Worldwide Operations in July 1999. In February
2000, he became Executive Vice President and General Manager of Hard Drive
Solutions. He was promoted to Executive Vice President and Chief Operating
Officer in April 2001, and served in that position until promoted to his current
position of President and Chief Operating Officer in January 2002.
Effective October 1, 2005, Matthew E. Massengill, age 44, will
relinquish the role of Chief Executive Officer of Western Digital and will
continue employment as Chairman of the Board of Directors or in such other
executive capacity as may be assigned by the Board. In connection with Mr.
Massengill's continued employment as Chairman of the Board, Western Digital and
Mr. Massengill entered into the Massengill Employment Agreement, dated as of
August 25, 2005, as described under Item 1.01 of this Form 8-K. Such description
is incorporated herein by reference.
Mr. Massengill has been a director of Western Digital since
January 2000 and became Chairman of the Board of Directors in November 2001. Mr.
Massengill has also served as Chief Executive Officer since January 2000. From
October 1999 until that time he was Chief Operating Officer, and from August
1999 to October 1999, he was Co-Chief Operating Officer. Prior to that time he
served for more than five years in various executive capacities within Western
Digital.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
10.1 Employment Agreement, dated as of August 25, 2005, between
Western Digital Corporation and Arif Shakeel.
10.2 Employment Agreement, dated as of August 25, 2005, between
Western Digital Corporation and Matthew E. Massengill.
99.1 Press Release, dated August 25, 2005, issued by Western
Digital Corporation.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
WESTERN DIGITAL CORPORATION
(Registrant)
By: /s/ RAYMOND M. BUKATY
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Date: August 25, 2005 Raymond M. Bukaty
-------------------- Senior Vice President, Administration,
General Counsel and Secretary