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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report: February 16, 2010
(Date of earliest event reported)
McAfee, Inc.
(Exact Name of Registrant as specified in Charter)
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Delaware
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Commission File No.:
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77-0316593 |
(State or other Jurisdiction
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001-31216
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(I.R.S. Employer Identification No.) |
of incorporation) |
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3965 Freedom Circle
Santa Clara, California 95054
(Address of Principal Executive Offices, including zip code)
(408) 346-3832
(Registrants telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions (see General
Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers.
2010 Grants of Performance Stock Units to Named Executive Officers
On February 16, 2010, the Compensation Committee (the Committee) of the Board of Directors
of McAfee, Inc. (McAfee) granted performance stock units
(PSUs) to the following named
executive officers:
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Name |
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Title |
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Number of PSUs |
David DeWalt
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Chief Executive Officer and President
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97,500 |
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Michael DeCesare
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Executive Vice President, Worldwide
Sales Operations
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22,100 |
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Mark Cochran
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Executive Vice President and
Chief Legal Officer/General Counsel
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15,600 |
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Keith Krzeminski |
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Senior Vice President, Finance and Chief Accounting Officer |
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3,900 |
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The vesting of the PSUs is based upon the achievement of certain performance measures
established by the Committee for the 2010 performance period and to be established by the Committee
for the future 2011 and 2012 performance periods. The PSUs are also subject to the terms and
conditions of McAfees 1997 Stock Incentive Plan, as amended, and McAfees standard form of
Performance Stock Unit Issuance Agreement entered into by McAfee and each award recipient.
Renewal of Change of Control and Retention Agreements
The Change of Control and Retention Agreements between McAfee and each of its named executive
officers expired on February 15, 2010 pursuant to their terms. After a review of market practices
conducted by the Committee, with the assistance of outside compensation consultants, the Committee
determined it appropriate to renew the Change of Control and Retention Agreements with each of
McAfees named executive officers
other than Albert Rocky Pimentel
for an additional two-year period.
As previously disclosed, Mr. Pimentel will be retiring later this year
as McAfees Chief Operating Officer and Chief Financial Officer.
Accordingly, on February 16,
2010 McAfee entered into a Change of Control and Retention Agreement with each of its named
executive officers other than Mr. Pimentel, the terms of which are identical to the respective expired agreements, except
with a term ending February 29, 2012. A summary of the material terms of the agreements is set
forth below. A copy of the form of the agreements is included as an Exhibit to this Form 8-K.
The agreement with Mr. DeWalt provides for certain severance benefits in the event McAfee
terminates Mr. DeWalts employment for other than cause or in the event that Mr. DeWalt resigns
for good reason. The agreement provides for varying severance benefits based upon whether the
termination occurs within eighteen (18) months following a change of control of McAfee (the
Change of Control Period). The severance payments provided to Mr. DeWalt by the agreement will
supersede any severance payments afforded Mr. DeWalt in any employment agreement he had with
McAfee. Without regard to severance payments, Mr. DeWalts employment will not be changed by the
agreement. Pursuant to the agreement and
subject to signing a standard release of claims, upon Mr. DeWalts termination for other than
cause or upon his resignation for good reason, he will be entitled to the following benefits:
Termination Other than During a Change of Control Period
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A lump-sum payment (less applicable tax withholding) equal to twelve (12) months of
Mr. DeWalts annual base salary, plus a pro rata fraction of the amount equal to 110%
of his annual base salary, with the pro rata fraction determined as the number of days
in the year to the date of termination divided by 365; |
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A payment equal to twelve (12) months of the cost of continuation coverage of
medical benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended (COBRA), if Mr. DeWalt was covered under McAfees health plan; and |
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Full acceleration of vesting of the outstanding restricted stock units from Mr.
DeWalts February 11, 2008 grant with respect to 125,000 shares of stock which are due
to fully vest within twelve (12) months following termination. |
Termination During a Change of Control Period
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A lump-sum payment (less applicable tax withholding) equal to twenty-four (24)
months of Mr. DeWalts annual base salary as in effect immediately prior to the change
of control or the termination (whichever is greater), plus the amount equal to 200% of
his target bonus for the fiscal year of the change of control or the termination
(whichever is greater); |
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A payment for COBRA as described above; and |
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Full acceleration of vesting of all Mr. DeWalts then outstanding equity awards. |
Additionally, in the event Mr. DeWalt is terminated for other than cause or resigns for good
reason before a change of control but on or after a potential change of control, Mr. DeWalt will
be entitled generally to the superior severance benefits provided by a termination during a Change
of Control Period. A potential change of control would generally occur upon the execution of an
agreement, Board approval, or public announcement for McAfee to enter into a transaction that would
be a change of control if such transaction is subsequently consummated. This benefit is only
available if the change of control occurs.
The
agreements with each of Mark Cochran, Michael DeCesare and Keith Krzeminski (the Tier 2 Executives), provide substantially the same terms and conditions as
the agreement with Mr. DeWalt as described above. However, the agreements with each Tier 2
Executive provide different benefits from those for Mr. DeWalt as described below:
Termination Other than During a Change of Control Period
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A lump-sum payment (less applicable tax withholding) equal to twelve (12) months of
the Tier 2 Executives annual base salary, plus a pro rata fraction of a stated
percentage, ranging from 43% to 100% of their annual base salary, with the pro rata |
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fraction determined as the number of days in the year to the date of termination divided
by 365; and |
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A payment equal to twelve (12) months of the cost of continuation coverage of
medical benefits under COBRA, if the Tier 2 Executive was covered under McAfees health
plan. |
Termination During a Change of Control Period
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A lump-sum payment (less applicable tax withholding) equal to twelve (12) months of
the Tier 2 Executives annual base salary as in effect immediately prior to the change
of control or the termination (whichever is greater), plus the amount equal to his
target bonus for the fiscal year of the change of control or the termination (whichever
is greater); |
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A payment for COBRA as described above; and |
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Full acceleration of vesting of all of the Tier 2 Executives then outstanding
equity awards. |
Apart from the varied benefits described directly above, the benefits provided to a Tier 2
Executive upon a termination for other than cause or a resignation for good reason are generally
the same as those provided to Mr. DeWalt, including the provision for benefits upon a potential
change of control.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits:
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10.1 |
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Form of Change of Control and Retention Agreement (Mr. DeWalt
and Tier 2 Executives). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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McAfee, Inc.
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Date: February 22, 2010 |
By: |
/s/ Mark D. Cochran
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Mark D. Cochran |
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Executive Vice President and Chief Legal
Officer/General Counsel |
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