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This excerpt taken from the WDC DEF 14A filed Sep 28, 2009. Change
in Control — Termination Without Cause or For Good
Reason
In addition to the change in control benefits described above,
executive officers may be entitled to severance benefits in the
event of certain terminations of employment upon or following a
change in control. These benefits are provided under our Change
of Control Severance Plan, which was adopted by our Board of
Table of Contents
Directors on March 29, 2001. The severance benefits are
payable if we or our subsidiaries terminate the employment of
the executive officer without “cause” or the employee
voluntarily terminates his or her employment for “good
reason” within one year after a change of control or prior
to and in connection with, or in anticipation of, such a change.
For these purposes, “change in control” generally has
the same meaning as described in the preceding section. For
these purposes, “cause” generally means the commission
of certain crimes by the executive, the executive’s willful
engaging in fraud or dishonest conduct, refusal to perform
certain duties, breach of fiduciary duty, or breach of certain
other violations of company policy. For these purposes,
“good reason” generally means the assignment to the
executive of materially inconsistent duties, a significant
adverse change in the executive’s reporting relationship,
certain reductions in compensation or benefits, and certain
relocations of the executive’s employment. For the specific
definitions of change in control, cause and good reason, please
refer to the Change of Control Severance Plan as filed with the
Securities and Exchange Commission.
For each of the named executive officers, the severance benefits
generally consist of the following:
(1) a lump sum payment equal to two times the sum of the
officer’s annual base compensation plus the target bonus as
in effect immediately prior to the change in control or as in
effect on the date of notice of termination of the
officer’s employment with us, whichever is higher;
(2) 100% vesting of any unvested stock options granted to
the officer by us;
(3) extension of the period during which the officer may
exercise his or her stock options to the longer of
(a) 90 days after the date of termination of his or
her employment and (b) the period specified in the plan or
agreement governing the options;
(4) continuation for a period of 24 months of the same
or equivalent life, health, hospitalization, dental and
disability insurance coverage and other employee insurance or
welfare benefits, including equivalent coverage for the
officer’s spouse and dependent children, and a car
allowance equal to what the officer was receiving immediately
prior to the change in control, or a lump sum payment equal to
the cost of obtaining coverage for 24 months if the officer
is ineligible to be covered under the terms of our insurance and
welfare benefits plans; and
(5) a lump sum payment equal to the amount of in-lieu
payments that the officer would have been entitled to receive
during the 24 months after termination of his or her
employment if, prior to the change in control, the officer was
receiving any
cash-in-lieu
payments designed to enable the officer to obtain insurance
coverage of his or her choosing.
Any health and welfare benefits will be reduced to the extent of
the receipt of substantially equivalent coverage by the officer
from any successor employer. Generally, the benefits will be
increased to the extent the officer has to pay taxes associated
with “excess parachute payments” under
Sections 280G and 4999 of the Internal Revenue Code so that
the net amount received by the officer is equal to the total
payments he or she would have received had the tax not been
incurred.
This excerpt taken from the WDC DEF 14A filed Sep 23, 2008. Change
in Control — Termination Without Cause or For Good
Reason
In addition to the change in control benefits described above,
executive officers may be entitled to severance benefits in the
event of certain terminations of employment upon or following a
change in control. These benefits are provided under our Change
of Control Severance Plan, which was adopted by our Board of
Directors on March 29, 2001. The severance benefits are
payable if we or our subsidiaries terminate the employment of
the executive officer without “cause” or the employee
voluntarily terminates his or her employment for “good
reason” within one year after a change of control or prior
to and in connection with, or in anticipation of, such a change.
For these purposes, “change in control” generally has
the same meaning as described in the preceding section. For
these purposes, “cause” generally means the commission
of certain crimes by the executive, the executive’s willful
engaging in fraud or dishonest conduct, refusal to perform
certain duties, breach of fiduciary duty, or breach of certain
other violations of company policy. For these purposes,
“good reason” generally means the assignment to the
executive of materially inconsistent duties, a significant
adverse change in the executive’s reporting relationship,
certain reductions in compensation or benefits, and certain
relocations of the executive’s employment. For the specific
definitions of change in control, cause and good reason, please
refer to the Change of Control Severance Plan as filed with the
Securities and Exchange Commission.
For each of the named executive officers, the severance benefits
generally consist of the following:
(1) a lump sum payment equal to two times the sum of the
officer’s annual base compensation plus the target bonus as
in effect immediately prior to the change in control or as in
effect on the date of notice of termination of the
officer’s employment with us, whichever is higher;
(2) 100% vesting of any unvested stock options granted to
the officer by us;
(3) extension of the period during which the officer may
exercise his or her stock options to the longer of
(a) 90 days after the date of termination of his or
her employment and (b) the period specified in the plan or
agreement governing the options;
(4) continuation for a period of 24 months of the same
or equivalent life, health, hospitalization, dental and
disability insurance coverage and other employee insurance or
welfare benefits, including equivalent coverage for the
officer’s spouse and dependent children, and a car
allowance equal to what the officer was receiving immediately
prior to the change in control, or a lump sum payment equal to
the cost of obtaining coverage for 24 months if the officer
is ineligible to be covered under the terms of our insurance and
welfare benefits plans; and
(5) a lump sum payment equal to the amount of in-lieu
payments that the officer would have been entitled to receive
during the 24 months after termination of his or her
employment if, prior to the change in control, the officer was
receiving any
cash-in-lieu
payments designed to enable the officer to obtain insurance
coverage of his or her choosing.
Any health and welfare benefits will be reduced to the extent of
the receipt of substantially equivalent coverage by the officer
from any successor employer. Generally, the benefits will be
increased to the extent the officer has to pay taxes associated
with “excess parachute payments” under
Sections 280G and 4999 of the Internal Revenue Code so that
the net amount received by the officer is equal to the total
payments he or she would have received had the tax not been
incurred.
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