| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Adoption of 2021 Equity Incentive Plan and Termination of 1999 Stock Option Plan
The Board of Directors (the “Board”) of NetApp, Inc. (the “Company”) previously approved, subject to stockholder approval, the adoption of the Company’s 2021 Equity Incentive Plan (the “2021 Plan”). At the Company’s annual meeting of stockholders held on September 10, 2021 (the “Annual Meeting”), the Company’s stockholders approved the adoption of the 2021 Plan. The 2021 Plan replaces the Company’s 1999 Stock Option Plan (the “1999 Plan”), and the 1999 Plan terminated effective as of September 11, 2021, except that the 1999 Plan will continue to govern awards outstanding thereunder as of the date of such plan’s termination and such awards will continue in force and effect until terminated pursuant to their terms.
A description of the material terms and conditions of the 2021 Plan was previously reported in the Company’s definitive proxy statement filed with the U.S. Securities and Exchange Commission on July 30, 2021, under the heading “Proposal 4 Approval of the NetApp, Inc. 2021 Equity Incentive Plan” and is incorporated herein by reference. The foregoing is qualified in its entirety by reference to the full text of the 2021 Plan, a copy of which is attached as Exhibit 10.1 and is incorporated herein by reference.
Approval of Form of Restricted Stock Unit Agreement (Employee)
The Compensation Committee (the “Committee”) of the Board previously approved, subject to stockholder approval of the 2021 Plan, a form of Restricted Stock Unit Agreement (Employee) (the “Employee RSU Agreement”) for use under the 2021 Plan.
The Employee RSU Agreement provides for the grant of restricted stock units (“RSUs”), each of which represents the right to receive a share of the Company’s common stock (or a cash amount equal to the value of a share on the date it becomes vested if the Company elects to settle the RSU in cash) on the date it vests. The RSUs vest as determined by the 2021 Plan administrator (the “Administrator”) and generally require the participant to continue as a service provider through the relevant vesting date.
An RSU recipient generally will not have any of the rights or privileges of a Company stockholder until shares of Company common stock are issued, recorded on the records of the Company or its transfer agents or registrars, and delivered to the participant.
The Employee RSU Agreement provides that in the event of a merger of the Company with or into another corporation or other entity or a change in control (as defined in the 2021 Plan), each outstanding award will be treated as the Administrator determines (subject to the provisions of the 2021 Plan). The Administrator will not be obligated to treat all awards, all awards held by a participant, all awards of the same type, or all portions of awards, similarly.
The foregoing summary of the Employee RSU Agreement does not purport to be complete and is qualified in its entirety by the full text of the Employee RSU Agreement, a copy of which will be filed with the Company’s Quarterly Report on Form 10-Q for the quarter ending October 29, 2021.
Approval of Form of Restricted Stock Unit Agreement (Senior Vice President and above)
The Committee previously approved, subject to stockholder approval of the 2021 Plan, a form of Restricted Stock Unit Agreement (Senior Vice President and above) (the “Executive RSU Agreement”) for use under the 2021 Plan.
The Executive RSU Agreement’s terms are substantially consistent with the terms contained in the Employee RSU Agreement except that the Executive RSU Agreement provides that if a participant ceases to be a service provider due to his or her retirement (as such term is defined in the Executive RSU Agreement), an additional number of RSUs will vest on the termination date equal to the number of RSUs that would have otherwise vested on the next scheduled vesting date, multiplied by a fraction with a numerator equal to the number of completed calendar months between the award’s most recent vesting date (or if no vesting has occurred, since the vesting commencement date) and the termination date, and a denominator equal to the number of calendar months between the award’s most recent vesting date (or if no vesting has occurred, since the vesting commencement date) and the award’s next scheduled vesting date, with the result rounded down to the nearest whole RSU.
