Item 1.01. Entry into a Material Definitive Agreement
On June 7, 2022, Western Digital Corporation (the "Company") entered into a
letter agreement (the "Agreement") with Elliott Investment Management L.P.
("Elliott"), a Delaware limited partnership, in connection with discussions
between the parties regarding (i) a strategic review of the Company (the
"Strategic Review") as announced in the Company's press release described below,
and (ii) a potential equity investment (the "Potential Investment") in the
Company or one of its business units by Elliott or one of its affiliates that
will be negotiated with the Company. The Agreement terminates effective upon the
Company's 2023 Annual Stockholder Meeting, except as otherwise specifically
provided in the Agreement.
Under the Agreement, Elliott has agreed to certain standstill restrictions in
effect until the Company's 2022 Annual Stockholder Meeting (the "Standstill
Period"). These standstill restrictions include restrictions with respect to
(a) effecting, offering or proposing to effect (i) any acquisition of any shares
of common stock and other Voting Securities (as defined in the Agreement) of the
Company if such acquisition would result in Elliott having beneficial ownership
of, or any economic interest (excluding cash only settled swaps) in, more than
9.9% of any Voting Securities or securities or rights convertible into or
exchangeable for more than 9.9% of any Voting Securities, (ii) any acquisition
of material assets of the Company, (iii) any tender or exchange offer involving
securities of the Company, (iv) any merger, other business combination,
recapitalization restructuring, liquidation, dissolution or other Strategic
Transaction (as defined below) with respect to the Company or (v) any
"solicitation" of "proxies" (as such terms are used under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) or consents with respect
to any Voting Securities, in each case for any such matters described in
(i) through (iv) except in connection with the Strategic Review and the
Potential Investment; (b) forming, joining or in any way acting in concert with
a "group" (as such term is used under the Exchange Act) with respect to any
Voting Securities, other than solely with Elliott's affiliates; (c) making any
public proposal with respect to any change to the management, the board of
directors (the "Board") or corporate policies of the Company; or (d) entering
into arrangements with any third party to take any action that Elliott is
prohibited from taking pursuant to (a) through (c) above.
--------------------------------------------------------------------------------
Under the Agreement, the Company and Elliott also have agreed that if the
Strategic Review has not resulted in an announced Strategic Transaction and the
Company is no longer in good faith pursuing a Strategic Transaction as part of
the Strategic Review at any time following the Company's 2022 Annual Stockholder
Meeting and prior to the filing with the Securities and Exchange Commission of
the definitive proxy statement for the Company's 2023 Annual Stockholder
Meeting, and provided that a minimum condition with respect to Elliott's
ownership of the Company's common stock (the "Minimum Condition") is met and, in
the case of clause (i) below, certain conditions with respect to the selection
of the Elliott Director (as defined below) are met, (i) Elliott will have the
right to appoint one director (the "Elliott Director") to the Board who shall be
an individual acceptable to the Company (with the Company's consent not to be
unreasonably withheld, conditioned, or delayed) who will serve on the executive
committee of the Board (the "Executive Committee"), and (ii) Elliott and the
Company will appoint one director to the Board to be mutually agreed upon
between the parties (the "Additional Director," together with the Elliott
Director, the "Appointed Directors"). If any Appointed Director is unable or
unwilling to serve as a director, resigns as a director, is removed as a
director or ceases to be a director for any other reason prior to the Company's
2023 Annual Stockholder Meeting, subject to the Minimum Condition being
satisfied, Elliott and the Company will appoint a substitute director to the
Board to be mutually agreed upon between Elliott and the Company. If Elliott has
exercised its right to appoint the Elliott Director and the Additional Director
to the Board (or is eligible to exercise or would be eligible to exercise but
for the Minimum Condition) or if the Company is still in good faith pursuing a
Strategic Transaction as part of the Strategic Review, the Standstill Period
will be extended until the Company's 2023 Annual Stockholder Meeting. The
Standstill Period also is subject to certain potential fall-away events, as
specified in the Agreement. A "Strategic Transaction" is a merger,
consolidation, acquisition or sale of all or substantially all assets of the
Company, or a sale, spinoff, splitoff, carve-out IPO or other similar separation
of the Company's Flash or HDD business units, or a merger with or acquisition of
Kioxia Holdings Corporation (or any successor thereof).
The foregoing description of the terms and conditions of the Agreement does not
purport to be complete and is qualified in its entirety by reference to the full
text of the Agreement, a copy of which is attached to this Current Report on
Form 8-K as Exhibit 10.1 and incorporated herein by reference.
Item 7.01 Regulation FD Disclosure.
On June 7, 2022, the Company issued a press release announcing that the Board is
reviewing its strategic options and with the assistance of its Executive
Committee is formally undertaking a Strategic Review and is entering into the
Agreement, a copy of which is attached hereto as Exhibit 99.1 (the "Press
Release"). All of the information in the Press Release is incorporated by
reference herein.
In accordance with General Instruction B.2 of Form 8-K, the information in this
Item 7.01, including Exhibit 99.1, shall not be deemed to be "filed" for
purposes of Section 18 of the Exchange Act, or otherwise subject to the
liabilities of that section, and shall not be incorporated by reference into any
registration statement or other document filed under the Securities Act of 1933,
as amended, or the Exchange Act, except as shall be expressly set forth by
specific reference in such filing.
Item 8.01 Other Events.
The information disclosed under Item 7.01 of this Current Report
on Form 8-K is incorporated by reference into this Item 8.01 to the extent
required herein.
--------------------------------------------------------------------------------
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
10.1 Letter Agreement, by and among Western Digital Corporation and Elliott
Investment Management L.P., dated June 7, 2022
99.1 Press Release issued by Western Digital Corporation, dated June 7, 2022
announcing the Strategic Review and entry into the Agreement
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
© Edgar Online, source Glimpses
WESTERN DIGITAL CORPORATION 
