Exhibit 10.1.7

 

Western®

Digital

  

Western Digital Corporation

 

ID: 95-2657125

3355 Michelson Drive, Suite 100

Irvine, CA 92612

(949) 672-7000 x 27985/27986

Notice of Grant of Stock Units

and Stock Unit Award Agreement – Executives

 

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Congratulations! Effective «optdt», you have been granted stock units of Western
Digital Corporation (the “Corporation”). These stock units were granted under
the 2004 Performance Incentive Plan (the “Plan”).1

Total Target Number of Stock Units: [            ]

First Measurement Period covered by grant: June 30, 2012 to June 28, 2013 (the
“First Measurement Period”). [            ] of your total target number of stock
units (the “First Measurement Period Units”) will vest and become payable based
on the achievement of performance goals established for the First Measurement
Period by the Compensation Committee of the Board of Directors of the
Corporation (the “Committee”). Upon determination by the Committee of the
performance goals for the First Measurement Period, the goals shall be
communicated to you in writing. The actual number of stock units that vest and
become payable based on performance during the First Measurement Period may
range from 0% to 200% of the number of First Measurement Period Units.

Second Measurement Period covered by grant: June 29, 2013 to June 27, 2014 (the
“Second Measurement Period”). [            ] of your total target number of
stock units (the “Second Measurement Period Units”) will vest and become payable
based on the achievement of performance goals established for the Second
Measurement Period by the Committee. Upon determination by the Committee of the
performance goals for the Second Measurement Period, the goals shall be
communicated to you in writing. The actual number of stock units that vest and
become payable based on performance during the Second Measurement Period may
range from 0% to 200% of the number of Second Measurement Period Units.

Your stock unit award is subject to the terms and conditions of this Notice, the
attached Standard Terms and Conditions for Performance Stock Unit Awards –
Executives (the “Standard Terms”) and the Plan.

 

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The number of stock units subject to the award is subject to adjustment under
Section 7.1 of the Plan (for example, and without limitation, in connection with
stock splits).

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By accepting the award, you are agreeing to the terms of the award 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
award. If you do not agree to the terms of your award, 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 these documents, or if you
would like to confirm that you have the most recent version, please contact the
Corporation’s Stock Plans Administrator.

 

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LOGO [g356205g45s00.jpg]

Western Digital Corporation 3355 Michelson Drive, Suite 100

Irvine, California 92612 Telephone 949 672-7000

STANDARD TERMS AND CONDITIONS FOR

PERFORMANCE STOCK UNIT AWARDS – EXECUTIVES

Amended and Restated 2004 Performance Incentive Plan

1. Stock Units Subject to 2004 Performance Incentive Plan

The Stock Unit Award (the “Award”) referred to in the attached Notice of Grant
of Stock Units and Stock Unit Award Agreement (the “Notice”) was awarded under
the Corporation’s Amended and Restated 2004 Performance Incentive Plan (the
“Plan”). Each stock unit covered by the Award (“Stock Unit”) is a non-voting
unit of measurement that is deemed for bookkeeping purposes to be equivalent to
one outstanding share of Common Stock (subject to adjustment as provided in
Section 7.1 of the Plan). The holder of the Stock Units is referred to herein as
the “Participant.” Stock Units shall be used solely as a device for the
determination of the number of shares of Common Stock to eventually be delivered
to the Participant if Stock Units held by such Participant vest pursuant to
Section 4, Section 7 or Section 8 and shall not be treated as property or as a
trust fund of any kind. The target number of Stock Units granted to the
Participant shall be credited to an unfunded bookkeeping account maintained by
the Corporation on behalf of the Participant (a “Stock Unit Account”).

The Stock Units are subject to the terms and provisions of the Notice, these
Standard Terms and Conditions for Performance Stock Unit Awards – Executives
(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. Capitalized terms not defined herein have the
meanings set forth in the Plan or in the Notice, as applicable.

2. Award Agreement

The Notice and these Standard Terms, together, constitute the Award Agreement
with respect to the Award pursuant to Section 5.3 of the Plan.

3. Deferral of Stock Units

Notwithstanding anything to the contrary contained herein, the Participant may
elect, on a form and in a manner provided by the Corporation and by any
applicable deferral election deadline, to defer the Stock Units subject to the
Award under the Corporation’s Deferred Compensation Plan (the “Deferred
Compensation Plan”). If the Participant makes such a deferral election, the
Stock Units will be paid (to the extent vested) in accordance with the payment
provisions of the Deferred Compensation Plan (including without limitation the
provisions requiring a six-month payment delay in the event that the Participant
is a “specified employee” for purposes of Section 409A of the Code), which are
incorporated herein by this reference, and any applicable deferral election made
by the Participant under and in accordance with the rules of the Deferred
Compensation Plan. Whether or not the Participant elects to defer the Stock
Units, any shares of Common Stock issued or delivered with respect to the Stock
Units shall be charged against the applicable share limits of the Plan.

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4. Vesting

Within a reasonable period of time following the end of the First Measurement
Period, the Committee shall determine, in accordance with the performance goals
and related criteria and methodology established by the Committee for the First
Measurement Period, the extent to which the performance goals have been achieved
and the actual number of First Measurement Period Units becoming vested based on
performance during the First Measurement Period. Similarly, within a reasonable
period of time following the end of the Second Measurement Period, the Committee
shall determine, in accordance with the performance goals and related criteria
and methodology established by the Committee for the Second Measurement Period,
the extent to which the performance goals have been achieved and the actual
number of Second Measurement Period Units becoming vested based on performance
during the Second Measurement Period. Any Stock Units (including any related
Stock Units credited as dividend equivalents pursuant to Section 5) that have
not become vested based on performance during the First Measurement Period or
Second Measurement Period, as applicable, shall terminate as of the end of the
applicable measurement period, and the Participant shall have no further rights
with respect to such terminated Stock Units.

Except as expressly provided in Sections 7 and 8 below, (i) the vesting schedule
for the First Measurement Period Units requires continued employment through the
end of the First Measurement Period as a condition to the vesting of any First
Measurement Period Units that vest based on performance and the rights and
benefits under this Award Agreement with respect to such Stock Units, and
(ii) the vesting schedule for the Second Measurement Period Units requires
continued employment through the end of the Second Measurement Period as a
condition to the vesting of any Second Measurement Period Units that vest based
on performance and the rights and benefits under this Award Agreement with
respect to such Stock Units. Except as expressly provided in Sections 7 and 8
below, employment for only a portion of the applicable 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 as provided in Section 8 below or under
the Plan.

5. Dividend Equivalent Rights Distributions

As of any date that the Corporation pays an ordinary cash dividend on its Common
Stock, the Corporation shall credit the Participant’s Stock Unit Account with an
additional number of Stock Units equal to (i) the per share cash dividend paid
by the Corporation on its Common Stock on such date, multiplied by (ii) the
number of Stock Units remaining subject to the Award as of the related dividend
payment record date, divided by (iii) the Fair Market Value of a share of Common
Stock on the date of payment of such dividend. For these purposes, any Stock
Units that vest and become payable in excess of the number of First Measurement
Period Units or Second Measurement Period Units, as applicable, shall be
considered to have been granted on the grant date set forth in the Notice. The
Stock Units credited pursuant to the foregoing provisions of this Section 5
shall be subject to the same vesting, payment and other terms, conditions and
restrictions as the original Stock Units to which they relate (including, for
any Stock Units deferred pursuant to Section 3, the payment provisions of the
Deferred Compensation Plan and any applicable deferral election made by the
Participant under and in accordance with the rules of the Deferred Compensation
Plan).

6. Timing and Manner of Payment of Stock Units

Except as provided in Sections 3, 7 or 8, (i) any First Measurement Period Units
that vest pursuant to the terms of the Notice and these Standard Terms shall be
paid within seventy (70) days following the end of the First Measurement Period
and (ii) any Second Measurement Period Units that vest pursuant to the terms of
the Notice and these Standard Terms shall be paid within seventy (70) days
following the end of the Second Measurement Period. For any Stock Units that
become payable (whether pursuant to this Section 6, Section 7 or Section 8
hereof or Section 7 of the Plan), the Corporation shall deliver to the
Participant a number of shares of Common Stock (either by delivering one or more
certificates for such shares or by entering such shares in book entry form, as
determined by the Corporation in its sole discretion) equal to the number of
Stock Units becoming payable (including any Stock Units credited as dividend
equivalents pursuant to Section 5 with respect to the Stock Units that vest and
become payable), subject to adjustment as provided in Section 7 of the Plan. The
Corporation’s obligation to deliver shares of Common Stock with respect to Stock
Units that vest and become payable is subject to the condition precedent that
the Participant (or other person entitled under the Plan to receive any shares
with respect to the vested Stock Units) delivers to the Corporation any
representations or other documents or assurances required pursuant to
Section 8.1 of the Plan in advance of the scheduled payment date. The
Participant shall have no further rights with respect to any Stock Units that
are paid pursuant to this Section 6 or that are terminated pursuant to Section 4
or Section 8 hereof or Section 7 of the Plan, and such Stock Units shall be
removed from the Participant’s Stock Unit Account upon the date of such payment
or termination. The Corporation may, in its sole discretion, settle any Stock
Units credited as dividend equivalents by a cash payment equal to the Fair
Market Value of a share of Common Stock on the date of payment (as opposed to
payment in the form of shares of Common Stock).

 

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7. Change in Control Event Generally

Subject to Sections 7.5, 7.6 and 7.7 of the Plan, upon (or, as may be necessary
to effectuate the purposes of this acceleration, immediately prior to) the
occurrence of a Change in Control Event in which the Stock Units subject to the
Award are to terminate (i.e., the Administrator has not made a provision for the
substitution, assumption, exchange or other continuation of the Award and the
Award will not otherwise continue in accordance with its terms in the
circumstances), the target number of Stock Units subject to the Award that are
then outstanding and unvested immediately prior to the Change in Control Event
(or such greater number of Stock Units as the Committee, in its sole discretion,
may deem appropriate in the circumstances, and subject to pro-ration as provided
in Section 8(a) in the event the Participant had died during the First
Measurement Period or Second Measurement Period and prior to the Change in
Control Event) shall vest and be paid as soon as practicable following (and in
all events no more than seventy (70) days after) the Change in Control Event.
Notwithstanding the foregoing or anything in this Award Agreement or the Plan,
if the Participant has elected to defer the Stock Units as provided in
Section 3, then payment with respect to such deferred Stock Units shall not be
made until such Stock Units would have become payable without regard to this
Section 7 or Section 7 of the Plan and the Administrator may (to the extent the
Stock Units subject to the Award would otherwise terminate in connection with
the Change in Control Event) provide for a cash amount of equivalent value at
the time of the Change in Control Event to be paid in respect of the deferred
Stock Units in lieu of the shares otherwise subject to such Stock Units.

8. Termination of Employment

(a) Termination of Employment Generally. Subject to earlier vesting as provided
in Section 7 or below in this Section 8, if the Participant ceases to be
employed by the Corporation or its Subsidiaries for any reason (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”), the Participant’s Stock Units shall be forfeited to the
Corporation to the extent such Stock Units have not become vested upon the
Severance Date; provided, however, that in the event of the Participant’s death
at a time when the Participant is employed by the Corporation or any of its
Subsidiaries, a pro-rata portion of the then outstanding and otherwise unvested
target number of Stock Units shall remain outstanding and eligible to vest based
on the achievement of the applicable performance goals as set forth in
Section 4, and shall be paid to the Participant’s legal representative as
provided in Section 6 above. In the event the date of the Participant’s death is
at a time when the Participant is employed by the Corporation or any of its
Subsidiaries, the pro-rata portion of the target number of Stock Units that
shall remain eligible to vest equals: (a) for any then outstanding and otherwise
unvested First Measurement Period Units, the number of First Measurement Period
Units multiplied by a fraction the numerator of which is the number of days in
the First Measurement Period that the Participant was employed by the
Corporation or one of its Subsidiaries prior to the Participant’s death and the
denominator of which is the total number of days in the First Measurement
Period, and (b) for any then outstanding and otherwise unvested Second
Measurement Period Units, the number of Second Measurement Period Units
multiplied by a fraction the numerator of which is the number of days in the
Second Measurement Period that the Participant was employed by the Corporation
or one of its Subsidiaries prior to the Participant’s death and the denominator
of which is the total number of days in the Second Measurement Period.

(b) Involuntary Termination of Employment. In the event the Participant ceases
to be employed by the Corporation or any of its Subsidiaries during the First
Measurement Period or Second Measurement Period as a result of a termination of
employment under circumstances that give rise to the payment of severance
payments under either the Corporation’s Executive Severance Plan or Amended and
Restated Change of Control Severance Benefits Plan (in accordance with the terms
of such plans and as each may be amended from time to time), the target number
of Stock Units subject to the Award that are then outstanding and unvested
immediately prior to such a termination of employment shall vest and be paid
within seventy (70) days following the date of such termination of employment.
For the avoidance of doubt, and not in any way in limitation of the
Participant’s rights to earn the First Measurement Period Units based on
performance, if such a termination occurs after the end of the First Measurement
Period, the Participant shall not be entitled to receive by virtue of his
termination of employment any First Measurement Period Units to the extent not
otherwise earned based on performance pursuant to Section 4. Notwithstanding the
foregoing payment terms of this Section 8(b), if the Participant has elected to
defer the Stock Units as provided in Section 3, then payment with respect to
such deferred Stock Units shall not be made until such Stock Units would have
become payable without regard to this Section 8(b).

 

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9. Adjustments

Upon the occurrence of certain events relating to the Corporation’s stock
contemplated by Section 7.1 of the Plan, the Administrator will make adjustments
if appropriate in the number of Stock Units then outstanding and the number and
kind of securities that may be issued in respect of the Award. No such
adjustment shall be made with respect to any ordinary cash dividend for which
dividend equivalents are paid pursuant to Section 5.

10. Withholding Taxes

Upon or in connection with the vesting of the Stock Units, the payment of
dividend equivalents and/or the distribution of shares of Common Stock in
respect of the Stock Units, the Corporation (or the Subsidiary last employing
the Participant) shall have the right at its option to (a) require the
Participant to pay or provide for payment in cash of the amount of any taxes
that the Corporation or the Subsidiary may be required to withhold with respect
to such vesting, payment and/or distribution, or (b) deduct from any amount
payable to the Participant the amount of any taxes which the Corporation or the
Subsidiary may be required to withhold with respect to such vesting, payment
and/or distribution. In any case where a tax is required to be withheld in
connection with the delivery of shares of Common Stock under this Award
Agreement, the Administrator may, in its sole discretion, direct the Corporation
or the Subsidiary to reduce the number of shares to be delivered by (or
otherwise reacquire) the appropriate number of whole shares, valued at their
then fair market value (with the “fair market value” of such shares determined
in accordance with the applicable provisions of the Plan), to satisfy such
withholding obligation at the minimum applicable withholding rates. Any deferred
Stock Units shall be subject to the tax withholding provisions of the Deferred
Compensation Plan.

11. Nontransferability

Neither the Award, nor any interest therein or amount or shares payable in
respect thereof may be sold, assigned, transferred, pledged or otherwise
disposed of, alienated, encumbered, either voluntarily or involuntarily. The
transfer restrictions in the preceding sentence shall not apply to (a) transfers
to the Corporation, or (b) transfers by will or the laws of descent and
distribution.

12. No Right to Employment

Nothing contained in this Award Agreement or the Plan constitutes an 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.

13. Rights as a Stockholder

Subject to the provisions of the Plan, the Notice and these Standard Terms, the
Participant shall have no rights as a stockholder of the Corporation, no
dividend rights (except as expressly provided in Section 5 with respect to
dividend equivalent rights) and no voting rights with respect to Stock Units
awarded to the Participant and any shares of Common Stock underlying or issuable
in respect of such Stock Units until such shares of Common Stock are actually
issued to and held of record by the Participant. No adjustments will be made for
dividends or other rights of a holder for which the record date is prior to the
date of issuance of the stock certificate.

 

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14. Notices

Any notice to be given under the terms of this Award 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 have been duly given five business days
after the date mailed in accordance with the foregoing provisions of this
Section 14.

15. Arbitration

Any controversy arising out of or relating to this Award 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 arising out of or related to
the Award, 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 §§ 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 Award 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 Award, the
Participant consents to all of the terms and conditions of this Award Agreement
(including, without limitation, this Section 15).

16. Governing Law

This Award 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.

17. Severability

If the arbitrator selected in accordance with Section 15 or a court of competent
jurisdiction determines that any portion of this Award Agreement (including
these Standard Terms) or the Plan is in violation of any statute or public
policy, then only the portions of this Award Agreement or the Plan, as
applicable, which are found to violate such statute or public policy shall be
stricken, and all portions of this Award 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 Award 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.

 

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18. Entire Agreement

This Award 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, including, without limitation, any provisions of the
Participant’s employment agreement with the Corporation that entitle the
Participant to receive a grant of “integration performance units”. By accepting
the Award, the Participant hereby agrees that the Award is in full satisfaction
of the Participant’s rights to receive “integration performance units” pursuant
to the terms of the Participant’s employment agreement with the Corporation. The
Plan and this Award 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 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.

19. Section Headings

The section headings of this Award Agreement are for convenience of reference
only and shall not be deemed to alter or affect any provision hereof.

 

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