EXHIBIT 10.30.1
[WESTERN DIGITAL LOGO] WESTERN DIGITAL CORPORATION
ID: 95-2647125
20511 Lake Forest Drive
Lake Forest, CA 92630-7741
NOTICE OF GRANT OF STOCK OPTION
AND OPTION AGREEMENT
NAME OPTION NO.: ######
ADDRESS LINE 1 PLAN: 2004 PERFORMANCE INCENTIVE PLAN
CITY, STATE ZIP ID: #####
Congratulations! Effective <<date>>, you have been granted a(n) <<option type>>
to buy <<number of shares>> shares of Western Digital Corporation stock at <<$
option price>> per share. The option was granted under the 2004 Performance
Incentive Plan (the "Plan ").(1)
VESTING:
Shares(1) Vest Type Full Vesting Expiration Date(2)
- --------- ------------ ------------ ------------------
<< >> On Vest Date mm/dd/yyyy mm/dd/yyyy
<< >> Quarterly mm/dd/yyyy mm/dd/yyyy
Your option is subject to the terms and conditions of this Notice, the attached
Standard Terms and Conditions for Stock Options (the "Standard Terms"), and the
Plan. By accepting the option, you are agreeing to the terms of the option as
set forth in those documents. You should read the Plan, the Prospectus for the
Plan, and the Standard Terms. The Standard Terms and the Plan are each
incorporated into (made a part of) this Notice by this reference. You do not
have to accept your option. If you do not agree to the terms of your option, you
should promptly return this Notice to the Western Digital Corporation Stock
Plans Administrator.
A copy of the Plan, the Prospectus for the Plan, and the Standard Terms have
been provided to you. If you need another copy of any of these documents, or if
you would like to confirm that you have the most recent version, you may obtain
another copy in the Company Library on the E*TRADE OptionsLink web site. The
documents are also available on the Western Digital Intranet site under Legal.
- --------
(1) The number of shares subject to the option and the per-share exercise price
of the option are subject to adjustment under Section 7.1 of the Plan (for
example, and without limitation, in connection with stock splits).
(2) The option is subject to early termination under Section 5 of the attached
Standard Terms and Conditions for Stock Options.
[WESTERN DIGITAL LOGO]
Western Digital Corporation 20511 Lake Forest Drive
Lake Forest, California 92630 Telephone 949 672-7000
STANDARD TERMS AND CONDITIONS FOR STOCK OPTIONS
2004 Performance Incentive Plan
1. OPTION SUBJECT TO 2004 PERFORMANCE INCENTIVE PLAN.
The option (the "Option") referred to in the attached Notice of Grant of Stock
Option and Option Agreement (the "Notice") was issued under Western Digital
Corporation's (the "Corporation's") 2004 Performance Incentive Plan (the
"Plan"). The Option is subject to the terms and provisions of the Notice, these
Standard Terms and Conditions for Stock Options (these "Standard Terms"), and
the Plan. To the extent any information in the Notice, the prospectus for the
Plan, or other information provided by the Corporation conflicts with the Plan
and/or these Standard Terms, the Plan or these Standard Terms, as applicable,
shall control. To the extent any terms and provisions in these Standard Terms
conflict with the terms and provisions of the Plan, the Plan shall control. The
holder of the Option is referred to herein as the "Participant." Capitalized
terms not defined herein have the meanings set forth in the Plan.
Unless otherwise expressly provided in other sections of these Standard Terms,
provisions of the Plan that confer discretionary authority on the Board or the
Administrator do not and shall not be deemed to create any rights in the
Participant unless such rights are expressly set forth herein or are otherwise
in the sole discretion of the Board or the Administrator so conferred by
appropriate action of the Board or the Administrator under the Plan after the
grant date of the Option.
2. OPTION AGREEMENT.
The Notice and these Standard Terms, together, constitute the Option Agreement
with respect to the Option pursuant to Section 5.3 of the Plan.
3. TYPE OF STOCK OPTION
The Notice indicates whether the Option is intended to qualify as an incentive
stock option (an "ISO") under the Internal Revenue Code of 1986, as amended (the
"Code"), or is a nonqualified stock option (an option that is not an ISO). ISOs
are subject to additional requirements under the Code as generally described in
Section 5.1 of the Plan. If the aggregate fair market value of the shares with
respect to which ISOs (whether granted under the Option or otherwise) first
become exercisable by the Participant in any calendar year exceeds $100,000, as
measured on the applicable option grant dates and as determined in accordance
with Code Section 422 and the regulations promulgated thereunder, the
limitations of Section 5.1.2 of the Plan shall apply and to such extent the
Option will be rendered a nonqualified stock option.
4. VESTING
The Option shall vest and become exercisable in percentage installments of the
aggregate number of shares subject to the Option as set forth in the Notice.
[STANDARD VESTING - INCLUDE UNLESS OTHERWISE PROVIDED BY THE ADMINISTRATOR AT
THE TIME OF GRANT OF THE AWARD: The first vesting installment of the Option
shall be a fixed installment covering the number of shares, and vesting on the
fixed vesting date, set forth in the first line of the Notice under "Vesting."
The balance of the Option (identified as "Quarterly" vesting in the Notice)
shall vest and
become exercisable in substantially equal quarterly installments over the three
year period following the first anniversary of the grant date of the Option
(such that the first quarterly installment shall vest on the date that is three
months after the first vesting date of the Option and so on such that all
quarterly installments are scheduled to have vested on or before the Quarterly
"Full Vesting" vesting date set forth in the Notice).] In each case, the Option
is subject to earlier termination in accordance with Section 5.
The Option may be exercised only to the extent it is vested and exercisable. To
the extent that the Option is vested and exercisable, the Participant has the
right to exercise the Option (to the extent not previously exercised), and such
right shall continue, until the expiration or earlier termination of the Option
as provided in Section 5. Fractional share interests shall be disregarded, but
may be cumulated.
The vesting schedule requires continued employment or service through each
applicable vesting date as a condition to the vesting of the applicable
installment of the Option and the rights and benefits under this Option
Agreement. Employment or service for only a portion of the vesting period, even
if a substantial portion, will not entitle the Participant to any proportionate
vesting or avoid or mitigate a termination of rights and benefits upon or
following a termination of employment or services as provided in Section 6 below
or under the Plan.
5. EXPIRATION OF OPTION
The Option shall expire and the Participant shall have no further rights with
respect thereto upon the earliest to occur of (a) the termination of the Option
as provided in Section 6 below, (b) the termination of the Option as provided in
Section 7.4 of the Plan, or (c) the Expiration Date set forth in the Notice. The
Option may not be exercised at any time after a termination or expiration of the
Option.
6. TERMINATION OF EMPLOYMENT, TOTAL DISABILITY OR DEATH
The Option shall be exercisable by the Participant (or his or her permitted
successor in interest) following the Participant's termination of employment
only to the extent provided below in this Section 6. Except as provided in
Section 6(f) below, the last day that the Participant is employed by the
Corporation or a Subsidiary prior to a period of non-employment by any such
entity is referred to as the Participant's "Severance Date." In each case
described below, the Option shall be subject to earlier termination as
contemplated by Section 5.
(a) Termination of Employment Generally. In the event the Participant ceases to
be an employee of the Corporation or any of its Subsidiaries for any reason
(other than a termination of employment by the Corporation or one of its
Subsidiaries for Cause (as defined below), due to the Participant's death or
Retirement (as defined below), or at a time when the Participant is Totally
Disabled (as defined below)), the Option shall terminate on the Participant's
Severance Date to the extent that it is not vested and exercisable on that date
and, to the extent that the Option is exercisable by the Participant on the
Participant's Severance Date, it may be exercised by the Participant at any time
within three months following the Participant's Severance Date. The Option, to
the extent exercisable for the three-month period following the Participant's
Severance Date and not exercised during such period, shall terminate at the
close of business on the last day of the three-month period.
(b) Total Disability. In the event that the Participant ceases to be an employee
of the Corporation or any of its Subsidiaries at a time when the Participant is
Totally Disabled and is not eligible to Retire, the Option shall terminate on
the Participant's Severance Date to the extent that it is not vested and
exercisable on that date. In such circumstances, or in the event that the
Participant incurs such a Total Disability within not more than three months of
the Participant's Severance Date if the termination of the Participant's
employment was for any reason other than a termination of employment by the
Corporation or one of its Subsidiaries for Cause, the Option may, to the extent
the Option was exercisable by the Participant on the Participant's Severance
Date, be exercised by the Participant (or, if the Participant is then
incapacitated, by the Participant's personal representatives, heirs, or
legatees) at any time during the one-year period following the Participant's
Severance Date. The Option, to the extent exercisable for the one-year period
following the Participant's Severance Date and not exercised during such period,
shall terminate at the close of business on the last day of the one-year period.
For purposes of the Option, "Total
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Disability" (which term shall include "Totally Disabled") means a "permanent and
total disability" within the meaning of Section 22(e)(3) of the Code.
(c) Death. If the Participant dies while he or she is an employee of the
Corporation or any of its Subsidiaries, the Option (to the extent outstanding
and not previously vested and exercisable) shall vest and become exercisable on
the Participant's Severance Date and shall continue to be exercisable by the
Participant's personal representatives, heirs or legatees, as applicable, at any
time during the three-year period following the Participant's Severance Date.
The Option, to the extent exercisable for the three-year period following the
Participant's Severance Date and not exercised during such period, shall
terminate at the close of business on the last day of the three-year period.
(d) Retirement. If the Participant Retires from the Corporation or one of its
Subsidiaries, the Option (to the extent outstanding and not previously vested
and exercisable) shall vest and become exercisable on the Participant's
Severance Date and shall continue to be exercisable by the Participant (or if
the Participant is then deceased, by the Participant's personal representatives,
heirs or legatees, as applicable) at any time during the three-year period
following the Participant's Severance Date. The Option, to the extent
exercisable for the three-year period following the Participant's Severance Date
and not exercised during such period, shall terminate at the close of business
on the last day of the three-year period. Notwithstanding the foregoing, in the
event a Retired Participant provides services to a competitor of the Corporation
or any of its Subsidiaries as an employee, consultant, director, officer,
representative, independent contractor or otherwise, or otherwise competes with
the business of the Corporation or its Subsidiaries (in each case as determined
by the Administrator its sole discretion), the Option, to the extent not
previously exercised, shall immediately terminate. In addition, in such event
the Corporation shall have the right to recover any profits realized by such
Retired Participant as a result of any exercise of the Option during the
six-month period prior to the date such Retired Participant commenced providing
such services to a competitor. For this purpose, the Participant shall be deemed
to have "Retired" (which term shall include "Retirement," "Retire" and
"Retires") if the Participant voluntarily retires from employment with the
Corporation or one of its Subsidiaries after satisfying all of the following at
the time of such retirement: (i) the Participant is at least 55 years of age,
(ii) the Participant's age plus total years of continuous service with the
Corporation or any of its Subsidiaries (as determined by the Administrator in
its sole discretion) totals at least 65, and (iii) the Participant has five (5)
or more years of continuous service with the Corporation or any of its
Subsidiaries (as determined by the Administrator in its sole discretion) ending
on the date of such retirement. For purposes of calculating "age plus total
years of continuous service" under clause (ii) above, fractional years shall be
disregarded but may be cumulated (so that, by way of example only, a Participant
who is age 55 and 6 months with 9 years and 6 months of continuous service would
satisfy the requirements of clause (ii), while a Participant who is age 55 and 6
months with 9 years and 5 months of continuous service would not satisfy the
requirements of clause (ii)). For purposes of calculating the Participant's
"years of continuous service" under clause (ii) or clause (iii) above, in no
event shall the Participant accrue more than one year of service with respect to
any period of twelve consecutive months (that is, concurrent employment by both
the Corporation and one or more of its Subsidiaries, or by multiple
Subsidiaries, for a month shall not be counted as more than one month of
service).
(e) Termination for Cause. Notwithstanding the foregoing provisions of this
Section 6, if the Participant's employment with the Corporation or any of its
Subsidiaries is terminated by the Corporation or one of its Subsidiaries for
Cause, the Option (whether or not all or any portion of such Option is then
vested and exercisable) shall immediately terminate on the Participant's
Severance Date. For these purposes, the term "Cause" shall mean the occurrence
or existence of any of the following with respect to the Participant, as
determined by the Administrator or its delegate or delegates in its or their
sole discretion:
(i) the Participant's conviction by, or entry of a plea of guilty or
nolo contendre in, a court of competent and final jurisdiction for any
crime involving moral turpitude or any felony punishable by imprisonment
in the jurisdiction involved;
(ii) whether prior or subsequent to the date hereof, the
Participant's willful engaging in dishonest or fraudulent actions or
omissions;
(iii) the Participant's failure or refusal to perform his or her
duties as reasonably required by his or her employer;
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(iv) negligence, insubordination, violation by the Participant of
any duty (loyalty or otherwise) owed to the Corporation, one or more of
its Subsidiaries, or any of their respective affiliates, or any other
misconduct on the part of the Participant;
(v) the repeated non-prescription use of any controlled substance,
or the repeated use of alcohol or any other non-controlled substance which
in the Administrator's (or its delegate's or delegates') reasonable
determination interferes with the Participant's service as an officer or
employee of the Corporation, one or more of its Subsidiaries, or any of
their respective affiliates;
(vi) sexual harassment by the Participant that has been reasonably
substantiated and investigated;
(vii) involvement in activities representing conflicts of interest
with the Corporation, one or more of its Subsidiaries, or any of their
respective affiliates;
(viii) improper disclosure of confidential information;
(ix) conduct endangering, or likely to endanger, the health or
safety of another employee;
(x) falsifying or misrepresenting information on the records of the
Corporation, one or more of its Subsidiaries, or any of their respective
affiliates;
(xi) the Participant's physical destruction or theft of substantial
property or assets of the Corporation, one or more of its Subsidiaries, or
any of their respective affiliates;
(xii) breach of any policy of, or agreement with, the Corporation,
one or more of its Subsidiaries, or any of their respective affiliates
applicable to the Participant or to which the Participant is otherwise
bound.
(f) Continuation of Services. If the Participant's employment with the
Corporation or any of its Subsidiaries terminates (regardless of the reason)
but, immediately thereafter, the Participant continues to render services to the
Corporation or any of its Subsidiaries as an employee, director or consultant,
such Participant's Severance Date for purposes of the Option shall not be the
date such Participant's employment terminates, but instead shall be the last day
that the Participant either is employed by or actually renders services to the
Corporation or any of its Subsidiaries. As provided in Section 6.1 of the Plan,
the Administrator shall be the sole judge for purposes of the Option of whether
the Participant continues to render services the Corporation or its Subsidiaries
and the date, if any, upon which such services shall be deemed to have
terminated.
(g) Exercise Period for ISOs. Notwithstanding any post-termination exercise
period provided for herein or in the Plan, the Option will qualify as an ISO
only if it is exercised within the applicable exercise periods for ISOs under,
and meets all of the other requirements of, the Code. If the Option is not
exercised within the applicable exercise periods for ISOs or does not meet such
other requirements, the Option will be rendered a nonqualified stock option.
7. EXERCISE OF OPTION
The Option shall be exercisable by the delivery to the Secretary of the
Corporation (or such other person as the Administrator may require pursuant to
such administrative exercise procedures as the Administrator may implement from
time to time) of:
- a written notice stating the number of shares of Common Stock to be
purchased pursuant to the Option or by the completion of such other
administrative exercise procedures as the Administrator may require
from time to time,
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- payment in full for the purchase price (the per-share exercise price
of the Option multiplied by the number of shares to be purchased) in
cash, check or by electronic funds transfer to the Corporation, or
(subject to compliance with all applicable laws, rules, regulations
and listing requirements and further subject to such rules as the
Administrator may adopt as to any non-cash payment) in shares of
Common Stock already owned by the Participant, valued at their fair
market value on the exercise date, provided, however, that any
shares initially acquired upon exercise of a stock option or
otherwise from the Corporation must have been owned by the
Participant for at least six (6) months before the date of such
exercise;
- any written statements or agreements required by the Administrator
pursuant to Section 8.1 of the Plan; and
- satisfaction of the tax withholding provisions of Section 8.5 of the
Plan.
The Administrator also may, but is not required to, authorize a non-cash payment
alternative by notice and third party payment in such manner as may be
authorized by the Administrator.
The Option will qualify as an ISO only if it meets all of the applicable
requirements of the Code.
8. NONTRANSFERABILITY
The Option and any other rights of the Participant under this Option Agreement
or the Plan are nontransferable and exercisable only by the Participant, except
as set forth in Section 5.7 of the Plan. For purposes of clarity, the
Administrator has not authorized any transfer exceptions as contemplated by
Section 5.7.2 of the Plan.
9. NO RIGHT TO EMPLOYMENT
Nothing contained in this Option Agreement or the Plan constitutes a continued
employment or service commitment by the Corporation or any of its Subsidiaries,
affects the Participant's status, if he or she is an employee, as an employee at
will who is subject to termination without cause, confers upon the Participant
any right to remain employed by or in service to the Corporation or any
Subsidiary, interferes in any way with the right of the Corporation or any
Subsidiary at any time to terminate such employment or service, or affects the
right of the Corporation or any Subsidiary to increase or decrease the
Participant's other compensation.
10. RIGHTS AS A STOCKHOLDER
Neither the Participant nor any beneficiary or other person claiming under or
through the Participant shall have any right, title, interest or privilege in or
to any shares of Common Stock subject to the Option except as to such shares, if
any, as shall have been actually issued to such person and recorded in such
person's name following the exercise of the Option or any portion thereof.
11. NOTICES
Any notice to be given under the terms of this Option Agreement shall be in
writing and addressed to the Corporation at its principal office to the
attention of the Secretary, and to the Participant at the address last reflected
on the Corporation's payroll records, or at such other address as either party
may hereafter designate in writing to the other. Any such notice shall be
delivered in person or shall be enclosed in a properly sealed envelope addressed
as aforesaid, registered or certified, and deposited (postage and registry or
certification fee prepaid) in a post office or branch post office regularly
maintained by the United States Government. Any such notice shall be given only
when received, but if the Participant is no longer employed by the Corporation
or a Subsidiary, shall be deemed to
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have been duly given five business days after the date mailed in accordance with
the foregoing provisions of this Section 11.
12. ARBITRATION
Any controversy arising out of or relating to this Option Agreement (including
these Standard Terms) and/or the Plan, their enforcement or interpretation, or
because of an alleged breach, default, or misrepresentation in connection with
any of their provisions, or any other controversy or claim arising out of or
related to the Option or the Participant's employment, including, but not
limited to, any state or federal statutory claims, shall be submitted to
arbitration in Orange County, California, before a sole arbitrator selected from
Judicial Arbitration and Mediation Services, Inc., Orange, California, or its
successor ("JAMS"), or if JAMS is no longer able to supply the arbitrator, such
arbitrator shall be selected from the American Arbitration Association, and
shall be conducted in accordance with the provisions of California Code of Civil
Procedure Sections 1280 et seq. as the exclusive forum for the resolution of
such dispute; provided, however, that provisional injunctive relief may, but
need not, be sought by either party to this Option Agreement in a court of law
while arbitration proceedings are pending, and any provisional injunctive relief
granted by such court shall remain effective until the matter is finally
determined by the arbitrator. Final resolution of any dispute through
arbitration may include any remedy or relief which the arbitrator deems just and
equitable, including any and all remedies provided by applicable state or
federal statutes. At the conclusion of the arbitration, the arbitrator shall
issue a written decision that sets forth the essential findings and conclusions
upon which the arbitrator's award or decision is based. Any award or relief
granted by the arbitrator hereunder shall be final and binding on the parties
hereto and may be enforced by any court of competent jurisdiction. The parties
acknowledge and agree that they are hereby waiving any rights to trial by jury
in any action, proceeding or counterclaim brought by either of the parties
against the other in connection with any matter whatsoever arising out of or in
any way connected with any of the matters referenced in the first sentence
above. The parties agree that Corporation shall be responsible for payment of
the forum costs of any arbitration hereunder, including the arbitrator's fee.
The parties further agree that in any proceeding with respect to such matters,
each party shall bear its own attorney's fees and costs (other than forum costs
associated with the arbitration) incurred by it or him or her in connection with
the resolution of the dispute. By accepting the Option, the Participant consents
to all of the terms and conditions of this Option Agreement (including, without
limitation, this Section 12).
13. GOVERNING LAW
This Option Agreement, including these Standard Terms, shall be interpreted and
construed in accordance with the laws of the State of Delaware (without regard
to conflict of law principles thereunder) and applicable federal law.
14. SEVERABILITY
If the arbitrator selected in accordance with Section 12 or a court of competent
jurisdiction determines that any portion of this Option Agreement (including
these Standard Terms) or the Plan is in violation of any statute or public
policy, then only the portions of this Option Agreement or the Plan, as
applicable, which are found to violate such statute or public policy shall be
stricken, and all portions of this Option Agreement and the Plan which are not
found to violate any statute or public policy shall continue in full force and
effect. Furthermore, it is the parties' intent that any order striking any
portion of this Option Agreement and/or the Plan should modify the stricken
terms as narrowly as possible to give as much effect as possible to the
intentions of the parties hereunder.
15. ENTIRE AGREEMENT
This Option Agreement (including these Standard Terms) and the Plan together
constitute the entire agreement and supersede all prior understandings and
agreements, written or oral, of the parties hereto with respect to the subject
matter hereof. The Plan and this Option Agreement may be amended pursuant to
Section 8.6 of the Plan. Such amendment must be in writing and signed by the
Corporation. The Corporation may, however, unilaterally waive any provision
hereof in writing to the extent such waiver does not adversely affect the
interests of the Participant
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hereunder, but no such waiver shall operate as or be construed to be a
subsequent waiver of the same provision or a waiver of any other provision
hereof.
16. SECTION HEADINGS
The section headings of this Option Agreement are for convenience of reference
only and shall not be deemed to alter or affect any provision hereof.
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