EXHIBIT 10.11
WESTERN DIGITAL CORPORATION
Executive Bonus Plan
Amended and Restated Effective January 1, 2000
Master Plan Document
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TABLE OF CONTENTS
ARTICLE 1 Definitions................................................................ 1
ARTICLE 2 Selection, Enrollment and Eligibility...................................... 5
2.1 Selection by Committee..................................................... 5
2.2 Enrollment Requirements.................................................... 6
2.3 Eligibility; Commencement of Participation................................. 6
ARTICLE 3 Vesting; Account Balance................................................... 6
3.1 Vesting in Change in Control Benefit....................................... 6
3.2 Forfeiture................................................................. 7
3.3 Account Balance............................................................ 7
ARTICLE 4 Benefits................................................................... 7
4.1 Change in Control Benefit.................................................. 7
4.2 Employer Benefit........................................................... 8
4.3 Withholding and Payroll Taxes.............................................. 8
ARTICLE 5 Beneficiary................................................................ 8
5.1 Beneficiary................................................................ 8
5.2 Beneficiary Designation; Change; Spousal Consent........................... 8
5.3 Acknowledgment............................................................. 9
5.4 No Beneficiary Designation................................................. 9
5.5 Doubt as to Beneficiary.................................................... 9
5.6 Discharge of Obligations................................................... 9
ARTICLE 6 Termination, Amendment or Modification of the Plan......................... 9
6.1 Termination, Amendment or Modification Prior to One Year Before Change in
Control.................................................................. 9
6.2 Termination, Amendment or Modification Within One Year Before Change of
Control or Following Change in Control................................... 10
6.3 Termination of Plan Agreement.............................................. 10
ARTICLE 7 Other Benefits and Agreements.............................................. 10
7.1 Coordination with Other Benefits........................................... 10
ARTICLE 8 Trust...................................................................... 10
8.1 Establishment of the Trust; Premiums....................................... 10
8.2 Interrelationship of the Plan and the Trust................................ 11
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8.3 Accounts................................................................... 11
ARTICLE 9 Insurance Policies......................................................... 12
9.1 Policies................................................................... 12
9.2 Documents Required by Insurer.............................................. 12
ARTICLE 10 Administration............................................................. 12
10.1 Committee Duties........................................................... 12
10.2 Agents..................................................................... 13
10.3 Binding Effect of Decisions................................................ 13
10.4 Indemnity of Committee..................................................... 13
10.5 Employer Information....................................................... 13
ARTICLE 11 Claims Procedures.......................................................... 13
11.1 Presentation of Claim...................................................... 13
11.2 Notification of Decision................................................... 14
11.3 Review of a Denied Claim................................................... 14
11.4 Decision on Review......................................................... 14
11.5 Legal Action............................................................... 15
ARTICLE 12 Miscellaneous.............................................................. 15
12.1 Unsecured General Creditor................................................. 15
12.2 Employer's Liability....................................................... 15
12.3 Nonassignability........................................................... 15
12.4 Not a Contract of Employment............................................... 16
12.5 Furnishing Information..................................................... 16
12.6 Terms...................................................................... 16
12.7 Captions................................................................... 16
12.8 Governing Law.............................................................. 16
12.9 Validity................................................................... 16
12.10 Notice..................................................................... 16
12.11 Successors................................................................. 17
12.12 Spouse's Interest.......................................................... 17
12.13 Incompetent................................................................ 17
12.14 Distribution in the Event of Taxation...................................... 17
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WESTERN DIGITAL CORPORATION
EXECUTIVE BONUS PLAN
AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2000
PURPOSE
The purpose of this Plan is to provide specified benefits to a select
group of management and highly compensated employees who may contribute
materially to the continued growth, development and future business success of
Western Digital Corporation, a Delaware corporation, and its subsidiaries. The
Plan is intended to constitute a bonus arrangement and fall outside the scope
and jurisdiction of the Employee Retirement Income Security Act of 1974.
ARTICLE 1
DEFINITIONS
For purposes hereof, unless otherwise clearly apparent from the context,
the following phrases or term shall have the following indicated meaning:
1.1 "Administrative Account" shall mean an account established in accordance
with Section 8.3(a)(ii) below.
1.2 "Beneficiary" shall mean one or more persons, trusts, estates or other
entities, designated in accordance with Article 5 below, that are
entitled to receive benefits under this Plan upon the death of a
Participant.
1.3 "Beneficiary Designation Form" shall mean the form established from time
to time by the Committee that a Participant completes, signs and returns
to the Committee to designate one or more Beneficiaries and attached
hereto as Exhibit A.
1.4 "Board" shall mean the Board of Directors of the Company.
1.5 "Change of Control" means and shall be deemed to occur if any of the
following events occur:
(a) Any Person (other than an Exempt Person), alone or together with
its Affiliates and Associates, including any group of Persons
which is deemed a "person" under Section 13(d) (3) of the
Exchange Act, becomes the
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Beneficial Owner, directly or indirectly, of thirty-three and
one-third percent or more of:
(i) the then-outstanding shares of the Company's common
stock or
(ii) securities representing thirty-three and one-third
percent or more of the combined voting power of the
Company's then outstanding voting securities;
(b) A change, during any period of two consecutive years, of a
majority of the Board of the Company as constituted as of the
beginning of such period, unless the election, or nomination for
election by the Company's stockholders, of each director who was
not a director at the beginning of such period was approved by
vote of at least two-thirds of the Incumbent Directors then in
office (for purposes hereof, "Incumbent Directors" shall consist
of the directors holding office as of the effective date of this
Plan and any person becoming a director subsequent to such date
whose election, or nomination for election by the Company's
stockholders, is approved by a vote of at least a majority of
the Incumbent Directors then in office);
(c) Consummation of any merger, consolidation, reorganization or
other extraordinary transactions (or series of related
transactions) involving the Company which results in the
stockholders of the Company having power to vote in the ordinary
election of directors immediately prior to such transaction (or
series of related transactions) failing to beneficially own at
least a majority of the securities of the Company having the
power to vote in the ordinary election of directors which are
outstanding after giving effect to such transaction (or series
of related transactions);
(d) The stockholders of the Company approve a plan of complete
liquidation of the Company or the sale of substantially all of
the assets of the Company;
(e) Substantially all of the assets of the Company are sold or
otherwise transferred to parties that are not within a
"controlled group of corporations" (as defined in Section 1563
of the Internal Revenue Code of 1986, as amended) in which the
Company is a member;
(f) The Company or any other Employer voluntarily files a petition
for bankruptcy under federal bankruptcy law, or an involuntary
bankruptcy
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petition is filed against any Employer under federal bankruptcy
law, which involuntary petition is not dismissed within 120 days
of the filing;
(g) The Company or any other Employer makes a general assignment for
the benefit of creditors; or
(h) The Company or any other Employer seeks or consents to the
appointment of a trustee, receiver, liquidator or similar
person.
With respect to Sections 1.5(f), (g) and (h) above, if the event
described occurs only with respect to one or more Employers
(other than the Company) and not to the Company, such event
shall be a "Change in Control" only with respect to the
Participants of that Employer or those Employers.
1.6 "Change in Control Benefit" shall mean the benefit set forth in Section
4.1 below.
1.7 "Claimant" shall have the meaning set forth in Section 11.1 below.
1.8 "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
1.9 "Committee" shall mean the administrative committee appointed to manage
and administer the Plan in accordance with the provisions of Article 10
below.
1.10 "Company" shall mean Western Digital Corporation, a Delaware
corporation.
1.11 "Disability" shall mean a period of disability during which a
Participant qualifies for benefits under the Participant's Employer's
long-term disability plan (if the Participant participates in such a
plan), or, if a Participant does not participate in such a plan, a
period of disability during which the Participant would have qualified
for benefits under the Employer's long-term disability plan had the
Participant been a participant in such a plan (determined in the sole
discretion of the Committee), or, if there is no such plan, as
determined in the sole discretion of the Committee.
1.12 "Employer" shall mean the Company and/or any of its subsidiaries that
have been selected by the Board to participate in the Plan.
1.13 "Employer Benefit" shall mean the benefit set forth in Section 4.2
below.
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1.14 "Forfeiture" shall mean a forfeiture of a Participant's rights to
benefits under this Plan as set forth in Section 3.2 below.
1.15 "Insurer" shall mean the insurance company or companies that issue one
or more Policies.
1.16 "Participant" shall mean any employee of an Employer
(a) who is selected to participate in the Plan,
(b) who elects to participate in the Plan,
(c) who signs a Plan Agreement and a Beneficiary Designation Form,
(d) whose signed Plan Agreement and Beneficiary Designation Form are
accepted by the Committee, and
(e) whose Plan Agreement has not terminated.
1.17 "Participant's Account" shall mean an account established in accordance
with Section 8.3(a)(i) below.
1.18 "Plan" shall mean the Western Digital Executive Bonus Plan, which is
defined by this instrument and by each Plan Agreement, all as may be
amended from time to time.
1.19 "Plan Agreement" shall mean a written agreement, as may be amended from
time to time, which is entered into by and between an Employer and a
Participant. Each Plan Agreement executed by a Participant shall provide
for the entire benefit to which such Participant is entitled to under
the Plan, and the Plan Agreement bearing the latest date of acceptance
by the Committee shall govern such entitlement.
1.20 "Plan Year" shall, for the first Plan Year, begin on May 16, 1994, and
end on December 31, 1994. For each Plan Year thereafter, the Plan Year
shall begin on January 1 of each year and continue through December 31
of that year.
1.21 "Policy" or "Policies" shall mean the policy or policies issued in the
name of the Trustee in accordance with the terms and conditions of this
Plan and each respective Plan Agreement.
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1.22 "Reserve Account" shall mean an account established in accordance with
Section 8.3(a)(iii) below.
1.23 "Retirement," "Retires" or "Retired" shall mean a Participant ceasing to
be employed by all Employers for any reason other than a leave of
absence, death, or Disability on or after a Participant attains the age
of fifty-five (55). In this regard, a Participant shall be deemed to
cease being employed by an Employer if and when the Employer employing
such Participant ceases to be a majority owned subsidiary of the Company
and the Board provides that such event shall be treated as a cessation
of employment by all Employers.
1.24 "Termination of Employment" shall mean the ceasing of employment with
all Employers, voluntarily or involuntarily, for any reason other than
Retirement, Disability or death. In this regard, a Participant shall be
deemed to cease being employed by an Employer if and when the Employer
employing such Participant ceases to be a majority owned subsidiary of
the Company and the Board provides that such event shall be treated as a
cessation of employment by all Employers.
1.25 "Trust" shall mean the trust established pursuant to that certain Trust
Agreement, dated as of May 16, 1994, between the Company and the
Trustee, as may be amended from time to time.
1.26 "Trustee" shall mean the trustee named in the Trust and any successor
trustee.
1.27 "Vesting Date" shall mean the date upon which a Participant becomes 100%
vested in his or her Change in Control Benefit in accordance with
Section 3.1 below.
1.28 "Western DCP" shall mean the Western Digital Corporation Deferred
Compensation Plan as in effect from time to time.
ARTICLE 2
SELECTION, ENROLLMENT AND ELIGIBILITY
2.1 Selection by Committee. Participation in the Plan shall be limited to a
select group of management and highly compensated employees of the
Employers. From that group, the Committee shall select, in its sole
discretion, employees to participate in the Plan.
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2.2 Enrollment Requirements. As a condition to participation, each selected
employee shall complete, execute and return to the Committee a Plan
Agreement and a Beneficiary Designation Form. In addition, the
Committee, in its sole discretion, shall establish from time to time
such other enrollment requirements as it determines are necessary.
2.3 Eligibility; Commencement of Participation. Provided an employee
selected to participate in the Plan has met all enrollment requirements
set forth in this Plan and required by the Committee, that employee
shall commence participation in the Plan on the date specified by the
Committee. If a selected employee fails to meet all such requirements
prior to that date, that employee shall not be eligible to participate
in the Plan until the completion of those requirements.
ARTICLE 3
VESTING; ACCOUNT BALANCE
3.1 Vesting in Change in Control Benefit. Subject to Section 3.2 below:
(a) General Rule. If a Participant has not Retired, died, suffered a
Disability, experienced a Termination of Employment, or received
a complete withdrawal from the Western DCP that permanently ends
his participation in such plan prior to 90 days prior to a
Change in Control, the Participant shall become 100% vested in
his or her Change in Control Benefit on January 1 of the Plan
Year following the Change in Control (the "Vesting Date").
(b) Early Vesting. If at any time on or after 90 days prior to a
Change in Control and prior to the Vesting Date a Participant
Retires, dies, suffers a Disability or experiences an
involuntary termination of employment with all Employers, the
Participant (or the Participant's Beneficiary in the event of
the Participant's death) shall become 100% vested in his or her
Change in Control Benefit on the later of
(i) the date of the Change in Control or
(ii) the date of such Retirement, death, Disability or
involuntary termination of employment, and such date
(rather than January 1 of the following Plan Year) shall
be considered the "Vesting Date" for purposes of this
Plan.
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3.2 Forfeiture. Notwithstanding Section 3.1 above, a Participant shall
forfeit rights to benefits under this Plan in accordance with this
Section 3.2.
(a) A Participant shall forfeit any right to benefits under this
Plan if he or she:
(i) Retires, dies, suffers a Disability, experiences a
Termination of Employment or receives a complete
withdrawal from the Western DCP that permanently ends
his participation in such plan prior to 90 days prior to
a Change in Control; or
(ii) Voluntarily terminates his or her employment (other than
by Retirement or Disability) with all of his Employers
or withdraws all of his interest in the Western DCP
thereby ending his participation in such plan at any
time on or after the date of the Change in Control and
prior to January 1 of the Plan Year following a Change
in Control.
(b) A Participant receiving a Short Payout or other partial
distribution from the Western DCP before his Vesting Date
described in Section 3.1(a) hereof shall forfeit a portion of
his Change in Control Benefit which bears the same proportion to
all of such benefit as the partial distribution bears to his
total interest in the Western DCP.
3.3 Account Balance. Within 60 days of the end of each Plan Year, the
Company shall determine the balance of each Participant's account as of
the end of that Plan Year.
ARTICLE 4
BENEFITS
4.1 Change in Control Benefit.
(a) Eligibility. On the Vesting Date, the Participant or the
Participant's Beneficiary, as the case may be, shall become
entitled to the "Change in Control Benefit" described in Section
4.1(b).
(b) Benefit and Payment. The "Change in Control Benefit" shall be a
dollar amount that is credited to the Participant's Account as
of the Vesting Date. This benefit shall be paid to the
Participant, or his or her Beneficiary, within 90 days of the
Vesting Date.
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4.2 Employer Benefit.
(a) Eligibility. The Participant's Employer shall be entitled to the
Employer Benefit if and to the extent a Participant forfeits his
Change in Control Benefit under Section 3.2 hereof.
(b) Benefit and Payment. The "Employer Benefit" shall be (i) a
distribution of the dollar amount that is allocated to and held
in the Participant's Account as of the date of the event
described in Section 3.2 above after taking into account any
distributions made or to be made in accordance with Section 4.1
above, plus any earnings allocated to that account from that
date to the date of payment of the Employer Benefit and (ii) a
distribution of any amount allocated to the Reserve Account in
Accordance with Section 8.3(a)(iii) below. This benefit shall be
paid to the Participant's Employer within 180 days of January 1
of the Plan Year following that event.
4.3 Withholding and Payroll Taxes. The Trustee shall withhold from any and
all benefit payments made under this Article 4, all federal, state and
local income, employment and other taxes required to be withheld in
connection with the payment of benefits hereunder, in amounts to be
determined in the sole discretion of the Participant's Employer.
ARTICLE 5
BENEFICIARY
5.1 Beneficiary. Each Participant shall have the right, at any time, to
designate his or her Beneficiary (both primary as well as contingent) to
receive any benefits payable under the Plan to a Beneficiary upon the
death of a Participant.
5.2 Beneficiary Designation; Change; Spousal Consent. A Participant shall
designate his or her Beneficiary by completing and signing the
Beneficiary Designation Form, and returning it to the Committee or its
designated agent. A Participant shall have the right to change a
Beneficiary by completing, signing and otherwise complying with the
terms of the Beneficiary Designation Form and the Committee's rules and
procedures, as in effect from time to time. If the Participant names
someone other than his or her spouse as a Beneficiary, a spousal
consent, in the form designated by the Committee, must be signed by that
Participant's spouse and returned to the Committee. Upon the acceptance
by the Committee of a new Beneficiary Designation Form, all Beneficiary
designations
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previously filed shall be cancelled. The Committee shall be entitled to
rely on the last Beneficiary Designation Form filed by the Participant
and accepted by the Committee before his or her death.
5.3 Acknowledgment. No designation or change in designation of a Beneficiary
shall be effective until received, accepted and acknowledged in writing
by the Committee or its designated agent.
5.4 No Beneficiary Designation. If a Participant fails to designate a
Beneficiary as provided in Sections 5.1, 5.2 and 5.3 above or, if all
designated Beneficiaries predecease the Participant or die prior to
complete distribution of the Participant's benefits, then the
Participant's designated Beneficiary shall be deemed to be his or her
surviving spouse. If the Participant has no surviving spouse, the
benefits remaining under the Plan to be paid to a Beneficiary shall be
payable to the executor or personal representative of the Participant's
estate.
5.5 Doubt as to Beneficiary. If the Committee has any doubt as to the proper
Beneficiary to receive payments pursuant to this Plan, the Committee
shall have the right, exercisable in its discretion, before a Change in
Control, to cause the Trustee to withhold such payments until this
matter is resolved to the Committee's satisfaction.
5.6 Discharge of Obligations. The payment of benefits under the Plan to a
Beneficiary shall fully and completely discharge all Employers and the
Committee from all further obligations under this Plan with respect to
the Participant, and the Participant's Plan Agreement shall terminate
upon such full payment of benefits.
ARTICLE 6
TERMINATION, AMENDMENT OR MODIFICATION OF THE PLAN
6.1 Termination, Amendment or Modification Prior to One Year Before Change
in Control. Prior to one year before a Change in Control, each Employer
reserves the right to terminate, amend or modify the Plan or any related
Plan Agreement, in whole or in part, with respect to Participants whose
services are retained by the Employer. Notwithstanding the foregoing, no
termination, amendment or modification shall be effective to decrease or
reduce a Participant's potential benefits under this Plan below the
balance in his or her Participant's Account as of the effective date of
the termination, amendment or modification.
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6.2 Termination, Amendment or Modification Within One Year Before Change of
Control or Following Change in Control. Within one year before a Change
in Control and thereafter, neither the Company, any subsidiary of the
Company nor any corporation, trust or other person that succeeds to all
or any substantial portion of the assets of the Company shall have the
right to terminate, amend or modify the Plan and/or any Plan Agreement
in effect prior to such Change in Control, and all benefits under the
Plan and any such Plan Agreement shall thereafter be paid in accordance
with the terms of the Plan and such Plan Agreement, as in effect
immediately prior to such Change in Control. If the Plan is terminated,
amended, or modified within one year before the Change in Control, such
termination, amendment or modification shall be considered void as of
the date of the termination, amendment or modification. Any provision of
this Plan or any Plan Agreement to the contrary shall be construed in
accordance with this Section 6.2.
6.3 Termination of Plan Agreement. Absent the earlier termination,
modification or amendment of the Plan, or a Participant's Forfeiture of
his or her benefits under this Plan, the Plan Agreement of any
Participant shall terminate upon the full payment of the applicable
benefit provided under Article 4.
ARTICLE 7
OTHER BENEFITS AND AGREEMENTS
7.1 Coordination with Other Benefits. The benefits provided for a
Participant and Participant's Beneficiary under the Plan are in addition
to any other benefits available to such Participant under any other plan
or program for employees. The Plan shall supplement and shall not
supersede, modify or amend any other such plan or program except as may
otherwise be expressly provided.
ARTICLE 8
TRUST
8.1 Establishment of the Trust; Premiums. The Employers shall establish the
Trust and shall at least annually transfer over to the Trust such assets
as the Committee determines, prior to a Change in Control, or the
Trustee determines, after a Change in Control, are necessary to provide
for the Employers' future liabilities created with respect to the
benefits provided under the Plan and the Plan Agreements, including,
without limitation, the payment of insurance premiums in amounts
sufficient to acquire and maintain all Policies held by the Trustee. At
the
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direction of the Committee, prior to a Change in Control, or the
Trustee, after a Change in Control, the Employers shall pay any and all
Policy premiums and other costs directly to the Insurer. In addition, if
the Trust incurs any tax liability, the Employers shall contribute to
the Trust sufficient funds to allow the Trustee to pay any such tax
liability.
8.2 Interrelationship of the Plan and the Trust. The provisions of the Plan
and each Plan Agreement shall govern the rights of a Participant to
receive distributions pursuant to the Plan. The provisions of the Trust
shall govern the rights of the Trustee, Participant and a Participant's
Beneficiary as to the assets of the Trust. The Employers shall at all
times remain liable to carry out their obligations under the Plan. The
Employers and the Trustee shall cooperate with each other as is
necessary to minimize the Trust's tax liability.
8.3 Accounts.
(a) The Trustee shall establish and maintain the following separate
accounts:
(i) A "Participant's Account" for each Participant to which
the Employers' contributions, or a portion thereof, and
earnings (or losses) thereon shall be allocated to and
held, the assets of which are to be used to pay the
Change in Control Benefit or the Employer Benefit in
accordance with this Plan and the Trust; and
(ii) An "Administrative Account" for the administrative
expenses of the Trust to which a portion of the
Employers' contributions and earnings thereon may be
allocated to and held, the assets of which are to be
used to pay the administrative expenses, including
without limitation all taxes and legal expenses, of the
Trust in accordance with the terms and provisions of
this Plan and the Trust.
(iii) A "Reserve Account" to which shall be allocated all
gains described in this subsection. In the event of the
death of a Participant or a former Participant whose
life is insured by a Policy, the excess of (a) the life
insurance proceeds received from such Policy over (b)
the cash value of such Policy as of the date immediately
preceding the Participant's death shall constitute a
gain allocable to the Reserve Account. Any such gain
allocated to the Reserve Account shall be distributed as
an Employer Benefit pursuant to Section 4.2(b).
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(b) Prior to a Change in Control, the Committee shall direct the
Trustee in writing as to:
(i) the allocation of the Employers' contributions to the
accounts described in Section 8.3(a) above, and
(ii) the amounts of the earnings on the Employer's
contributions held in the accounts described in Section
8.3(a) above. After a Change in Control, the Trustee
shall make such allocations in accordance with the terms
of the Plan and the Trust. Notwithstanding the
foregoing, and except for a payment of benefits in
accordance with Article 4 or a Forfeiture of benefits, a
Participant's Account balance shall not be reduced.
(c) Each of the accounts described in Section 8.3(a) above shall
qualify for and be treated as separate shares under Code Section
663(c).
ARTICLE 9
INSURANCE POLICIES
9.1 Policies. The Committee may direct the Trustee in writing to acquire one
or more Policies in the Trustee's name. The Trustee shall be the sole
and absolute owner and beneficiary of each Policy, with all rights of an
owner and beneficiary, including without limitation, the right to
surrender Policies for their cash surrender values and to take one or
more loans against one or more Policies. Notwithstanding the foregoing,
the Trustee shall exercise its ownership rights in each Policy only in
accordance with the terms of this Plan, the respective Plan Agreements
and the Trust.
9.2 Documents Required by Insurer. The Trustee, the Participant's Employer
and the Participant shall sign such documents and provide such
information as may be required from time to time by the Insurer.
ARTICLE 10
ADMINISTRATION
10.1 Committee Duties. This Plan shall be administered by a Committee which
shall consist of persons approved by the Board. Members of the Committee
may be Participants under this Plan. The Committee shall also have the
discretion and
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authority to make, mend, interpret, and enforce all appropriate rules
and regulations for the administration of this Plan and decide or
resolve any and all questions including interpretations of this Plan, as
may arise in connection with the Plan.
10.2 Agents. In the administration of this Plan, the Committee may, from time
to time, employ agents and delegate to them such administrative duties
as it sees fit and may from time to time consult with counsel who may be
counsel to any Employer.
10.3 Binding Effect of Decisions. The decision or action of the Committee
with respect to any question arising out of or in connection with the
administration, interpretation and application of the Plan and the rules
and regulations promulgated hereunder shall be final and conclusive and
binding upon all persons having any interest in the Plan.
10.4 Indemnity of Committee. All Employers shall indemnify and hold harmless
the members of the Committee against any and all claims, losses,
damages, expenses or liabilities arising from any action or failure to
act with respect to this Plan, except in the case of willful misconduct
by the Committee or any of its members.
10.5 Employer Information. To enable the Committee to perform its functions,
each Employer shall supply full and timely information to the Committee
on all matters relating to the compensation of its Participants, the
date and circumstances of the Retirement, Disability, death or
Termination of Employment of its Participants, and such other pertinent
information as the Committee may reasonably require.
ARTICLE 11
CLAIMS PROCEDURES
11.1 Presentation of Claim. Any Participant or Beneficiary of a deceased
Participant (such Participant or Beneficiary being referred to below as
a "Claimant") may deliver to the Committee a written claim for a
determination with respect to the amounts distributable to such Claimant
from the Plan. If such a claim relates to the contents of a notice
received by the Claimant, the claim must be made within 60 days after
such notice was received by the Claimant. All other claims must be made
within 180 days of the date on which the event that caused the claim to
arise occurred. The claim must state with particularity the
determination desired by the Claimant.
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11.2 Notification of Decision. The Committee shall consider a Claimant's
claim within 60 days of receipt of that claim, and shall notify the
Claimant in writing:
(a) that the Claimant's requested determination has been made, and
that the claim has been allowed in full; or
(b) that the Committee has reached a conclusion contrary, in whole
or in part, to the Claimant's requested determination, and such
notice must set forth in a manner calculated to be understood by
the Claimant:
(i) the specific reason(s) for the denial of the claim, or
any part of it;
(ii) the specific reference(s) to pertinent provisions of the
Plan upon which such denial was based;
(iii) a description of any additional material or information
necessary for the Claimant to perfect the claim, and an
explanation of why such material or information is
necessary; and
(iv) an explanation of the claim review procedure set forth
in Section 11.3 below.
11.3 Review of a Denied Claim. Within 60 days after receiving a notice from
the Committee that a claim has been denied, in whole or in part, a
Claimant (or the Claimant's only authorized representative) may file
with the Committee a written request for a review of the denial of the
claim. Thereafter, but not later than 30 days after the review procedure
began, the Claimant (or the Claimant's duly authorized representative):
(a) may review pertinent documents;
(b) may submit written comments or other documents; and/or
(c) may request a hearing, which the Committee, in its sole
discretion, may grant.
11.4 Decision on Review. The Committee shall render its decision on review
promptly, and not later than 60 days after the filing of a written
request for review of the denial, unless a hearing is held or other
special circumstances require additional time, in which case the
Committee's decision must be rendered within
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120 days after such date. Such decision must be written in a manner
calculated to be understood by the Claimant, and it must contain:
(a) specific reasons for the decision;
(b) specific reference(s) to the pertinent Plan provisions upon
which the decision was based; and
(c) such other matters as the Committee deems relevant.
11.5 Legal Action. A Claimant's compliance with the foregoing provisions of
this Article 11 is a mandatory prerequisite to a Claimant's right to
commence any legal action with respect to any claim for benefits under
this Plan.
ARTICLE 12
MISCELLANEOUS
12.1 Unsecured General Creditor. Participants and their Beneficiaries, heirs,
successors and assigns shall have no legal or equitable rights, interest
or claims in any property or assets of an Employer. Any and all of an
Employer's assets shall be, and remain, the general, unpledged and
unrestricted assets of the Employer. An Employer's obligation under the
Plan shall be merely that of an unfunded and unsecured promise to pay
money in the future.
12.2 Employer's Liability. An Employer's liability for the payment of
benefits shall be defined only by the Plan and the Plan Agreement, as
entered into between the Employer and a Participant. An Employer shall
have no obligation to a Participant under the Plan except as expressly
provided in the Plan and his or her Plan Agreement.
12.3 Nonassignability. Neither a Participant nor any other person shall have
any right to commute, sell, assign, transfer, pledge, anticipate,
mortgage or otherwise encumber, transfer, hypothecate or convey in
advance of actual receipt, the amounts, if any, payable hereunder, or
any part thereof, which are, and all rights to which are expressly
declared to be unassignable and non-transferable, except that the
foregoing shall not apply to any family support obligations set forth in
a court order. No part of the amounts payable shall, prior to actual
payment, be subject to seizure or sequestration for the payment of any
debts, judgments, alimony or separate maintenance owed by a Participant
or any other person, nor
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be transferable by operation of law in the event of a Participant's or
any other person's bankruptcy or insolvency.
12.4 Not a Contract of Employment. The terms and condition of this Plan shall
not be deemed to constitute a contract of employment between any
Employer and the Participant. Such employment is hereby acknowledged to
be an "at will" employment relationship that can be terminated at any
time for any reason, with or without cause, unless expressly provided in
a written employment agreement. Nothing in this Plan shall be deemed to
give a Participant the right to be employed in the service of any
Employer, or to interfere with the right of any Employer to discipline
or discharge the Participant at any time.
12.5 Furnishing Information. A Participant will cooperate with the Committee
by furnishing any and all information requested by the Committee and
take such other actions as may be requested in order to facilitate the
administration of the Plan and the payments of benefits hereunder,
including but not limited to taking such physical examinations as the
Committee may deem necessary.
12.6 Terms. Whenever any words are used herein in the singular or in the
plural, they shall be construed as though they were used in the plural
or the singular, as the case may be, in all cases where they would so
apply.
12.7 Captions. The captions of the articles, sections and paragraphs of this
Plan are for convenience only and shall not control or affect the
meaning or construction of any of its provisions.
12.8 Governing Law. The provisions of this Plan shall be construed and
interpreted according to the laws of the State of California.
12.9 Validity. In case any provision of this Plan shall be illegal or invalid
for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Plan shall be construed and enforced as
if such illegal and invalid provision had never been inserted herein.
12.10 Notice. Any notice or filing required or permitted to be given to the
Committee under this Plan shall be sufficient if in writing and
hand-delivered, or sent by registered or certified mail, to the address
below:
Deferred Compensation Plan Committee
Western Digital Corporation
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8105 Irvine Center Drive
Irvine, California 92718
Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark on the
receipt for registration or certification.
Any notice or filing required or permitted to be given to a Participant
under this Plan shall be sufficient if in writing and hand-delivered, or
sent by mail, to the last known address of the Participant.
12.11 Successors. The provisions of this Plan shall bind and inure to the
benefit of the Participant's Employer and its successors and assigns and
the Participant, the Participant's Beneficiaries, and their permitted
successors and assigns.
12.12 Spouse's Interest. The interest in the benefits hereunder of a spouse of
a Participant who has predeceased the Participant shall automatically
pass to the Participant and shall not be transferable by such spouse in
any manner, including but not limited to such spouse's will, nor shall
such interest pass under the laws of intestate succession.
12.13 Incompetent. If the Committee determines in its discretion that a
benefit under this Plan is to be paid to a minor, a person declared
incompetent or to a person incapable of handling the disposition of that
person's property, the Committee may direct payment of such benefit to
the guardian, legal representative or person having the care and custody
of such minor, incompetent or incapable person. The Committee may
require proof of minority, incompetency, incapacity or guardianship, as
it may deem appropriate prior to distribution of the benefit. Any
payment of a benefit shall be a payment for the account of the
Participant and the Participant's Beneficiary, as the case may be, and
shall be a complete discharge of any liability under the Plan for such
payment amount.
12.14 Distribution in the Event of Taxation. If, for any reason, all or any
portion of a Participant's benefit under this Plan becomes taxable to
the Participant prior to the Vesting Date, a Participant may petition
the Committee, if prior to a Change in Control, or the Trustee, after a
Change in Control, for a distribution of assets sufficient to meet the
Participant's tax liability (including additions to tax, penalties and
interest). Upon the grant of such a petition, which grant shall not be
unreasonably withheld, the Trustee shall distribute to the Participant
from the Trust immediately available funds in an amount equal to that
Participant's federal, state and local tax liability associated with
such taxation, which liability shall be
17
measured by using that Participant's then current highest federal, state
and local marginal tax rate, plus the rates or amounts for the
applicable additions to tax, penalties and interest. If the petition is
granted, the tax liability distribution shall be made within 90 days of
the date when the Participant's petition is granted.
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IN WITNESS WHEREOF the Company has signed this Plan document as of
January 1, 2000.
WESTERN DIGITAL CORPORATION,
a Delaware corporation
By:
-----------------------------------
Officer's Name:
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