The Board of Directors of the Company believes that Directors should own and hold common stock of the Company to further align their interests and actions with the interests of the Company’s stockholders. Therefore, the Board of Directors has adopted the following Stock Ownership Guidelines effective November 18, 2004 and amended on November 17, 2005.
1.
Director Stock Ownership Guidelines
Directors of the Company must own at least 15,000 shares of Western Digital’s common stock. This minimum stock ownership level must be achieved by each Director within five years of the adoption of these guidelines or within three years of first appointment to the Board. Any change in the value of the stock (such as a stock split, stock dividend, recapitalization, etc.) will not affect the amount of stock Directors must hold. Once achieved, ownership of the guideline amount must be maintained as long as the Director retains his or her seat on the Board.
2.
Compliance with the Guidelines
Stock that counts toward satisfaction of these Guidelines include:
stock purchased on the open market;
stock obtained through stock option exercises;
restricted stock units;
deferred stock units; and
stock beneficially owned in a trust, by a spouse and/or minor children.
3.
Exceptions
There may be rare instances where these Guidelines would place a severe hardship on a Director. The Governance Committee will make the final decision as to developing an alternative stock ownership guideline for a Director that reflects the intention of these Guidelines and his or her personal circumstances.
