Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of Certain Officers
Effective August 19, 2009, the Board of Directors of NetApp, Inc. (the
"Company") appointed Thomas Georgens, 49, as Chief Executive Officer and
President of the Company (including principal executive officer and principal
operating officer), to succeed Daniel J. Warmenhoven and appointed
Mr. Warmenhoven, 58, to serve in the newly created position of Executive
Chairman. Mr. Warmenhoven will continue to serve as Chairman of the Board of
Directors of the Company, and Mr. Georgens will continue to serve as a member of
the Board of Directors of the Company. As the Executive Chairman,
Mr. Warmenhoven will remain an "officer" for purposes of Rule 16a-1(f) of the
Securities Exchange Act of 1934, as amended, and therefore subject to the filing
requirements of Section 16(a) of the Exchange Act. These management changes are
the result of a management succession process.
Mr. Georgens had been Chief Operating Officer and President of the Company
since February 2008. Mr. Georgens joined the Company in October 2005 as
executive vice president and general manager of Enterprise Storage Systems and
was named executive vice president of Product Operations in January 2007. Before
joining the Company, Mr. Georgens worked for nine years at Engenio, a subsidiary
of LSI Corporation, the last two years as Chief Executive Officer. He has also
served in various other positions, including President of LSI Corporation
Storage Systems and Executive Vice President of LSI Corporation.
There are no family relationships between Messrs. Georgens or Warmenhoven
with any other executive officers of the Company or members of the Board of
Directors.
A copy of the press release announcing these officer appointments is filed
with this Form 8-K and attached hereto as Exhibit 99.1.
Compensatory Arrangements of Certain Officers
In connection with the appointment of Messrs. Georgens and Warmenhoven to
their positions as Chief Executive Officer and Executive Chairman of the
Company, respectively, the Compensation Committee of the Board of Directors
approved the following compensation packages for fiscal 2010 for the two
executive officers:
Effective as of August 19, 2009, Mr. Georgens' new base annual salary is
$825,000 and his target incentive compensation award (expressed as a percentage
of his annual base salary) is 130%. In addition, on September 15, 2009,
Mr. Georgens will be granted a stock option to purchase 650,000 shares of
Company common stock under the Company's 1999 Stock Option Plan.
Effective as of August 19, 2009, Mr. Warmenhoven's new annual base salary
is $450,000 and his target incentive compensation award (expressed as a
percentage of his annual base salary) is 110%.
Other than as indicated herein, the compensation arrangements for
Mr. Georgens and Mr. Warmenhoven remain the same.
Change of Control Severance Agreements
On August 19, 2009, the Company entered into Amended and Restated Change of
Control Severance Agreements (each an "Agreement" and collectively the
"Agreements") with each of Mr. Georgens and Mr. Warmenhoven (each an
"Executive"). The Agreements supersede the Change of Control Severance Agreement
entered into between each Executive and the Company dated June 19, 2008. The
severance provisions of the Agreements are described below. The complete terms
of the Agreements can be found in the Agreements themselves, which will be filed
as exhibits to the Company's Quarterly Report on Form 10-Q for the period ending
October 30, 2009.
If the Company terminates an Executive without Cause (as such term is
defined in the Agreement) or if the Executive resigns for Good Reason (as such
term is defined in the Agreement), and such termination occurs within twelve
(12) months after a Change of Control, then subject to the terms of the
Agreement each Executive will receive the following:
Table of Contents
Thomas Georgens Daniel Warmenhoven
A lump sum payment equal to 250% of A lump sum payment equal to 200% of
Mr. Georgens' base salary (increased Mr. Warmenhoven's base salary
from 200%); (decreased from 250%);
100% of Mr. Georgens' target annual 100% of Mr. Warmenhoven's target
bonus; annual bonus;
Continued payment of COBRA premiums Continued payment of COBRA premiums
for Mr. Georgens and his eligible for Mr. Warmenhoven and his eligible
dependents for up to 24 months dependents for up to 18 months
(increased from 18 months); and (decreased from 24 months); and
All outstanding equity awards will Outstanding equity awards granted
vest in full. before June 19, 2008 will vest in
full. Outstanding equity awards
granted after June 19, 2008 that are
subject to time-based vesting will
accelerate as to an additional
24 months and outstanding equity
awards granted after June 19, 2008
that are subject to performance-based
vesting will accelerate as to 50% of
the unvested portion.
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