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WDC » Topics » Separation, Transition and General Release Agreement with Mr. Milligan

This excerpt taken from the WDC DEF 14A filed Sep 23, 2008.
Separation, Transition and General Release Agreement with Mr. Milligan
 
On July 31, 2007, we entered into a separation, transition and general release agreement with Mr. Milligan in connection with his separation from service with the company on August 31, 2007. In connection with his separation from service, Mr. Milligan became entitled to the following benefits:
 
  •  A lump sum payment of $1,627,611, which includes (i) $1,400,000 as severance pay; (ii) $168,750, the amount of the cash bonus payable to Mr. Milligan under our Incentive Compensation Plan for the performance period ended June 29, 2007; and (iii) $58,861, a pro-rata portion of the cash bonus payable to Mr. Milligan under our Incentive Compensation Plan for the performance period ended December 31, 2007, based on the number of days in the performance period during which Mr. Milligan was employed and assuming 100% of the performance goal(s) applicable to the bonus award were met regardless of the actual funding by us.
 
  •  Accelerated vesting of outstanding stock options otherwise scheduled to vest between August 31, 2007 and February 29, 2008, the value of which we estimate at approximately $182,749. This amount was calculated by multiplying (i) the difference between the closing market price of a share of our common stock on August 31, 2007 ($23.36) and the applicable exercise price of the stock options by (ii) the number of shares subject to stock options vesting on an accelerated basis on August 31, 2007.


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  •  Accelerated vesting of outstanding shares of restricted stock otherwise scheduled to vest between August 31, 2007 and February 29, 2008, the value of which we estimate at approximately $700,800. This amount was calculated by multiplying (i) the closing market price of a share of our common stock on August 31, 2007 ($23.36) by (ii) the number of shares of restricted stock vesting on an accelerated basis on August 31, 2007.
 
  •  A lump sum payment equal to $19,257, the amount of Mr. Milligan’s COBRA premium payments for such coverage for a period of eighteen (18) months following separation.
 
  •  company-provided outplacement services for a period of twelve (12) months following separation, subject to a maximum cost to us of $15,000.
 
As a condition to the payment of the benefits described above, Mr. Milligan signed a general release of all claims in favor of the company and its directors, officers, employees or agents. Mr. Milligan also agreed not to (i) disclose our confidential information (except to the extent it becomes part of the public domain or as he may be required to disclose such information by court order); (ii) make or ratify, directly or indirectly, any disparaging remarks regarding us or our directors, officers, employees or agents, or any remarks that have the purpose or effect of disrupting our business; or (iii) solicit our employees for a period of one (1) year following his separation.


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