Western Digital 1995 Annual Report Download - page 29

   Notes to Consolidated Financial Statements (Continued)  .
In 1985, the Company adopted the Stock Option Plan for Non-Employee
Directors (“Director Plan”) and reserved 800,000 shares for issuance thereunder.
The Director Plan provides for initial option grants to new directors of 20,000
shares per director and additional grants of up to 30,000 options per director fol-
lowing the exercise of the initial options. Terms of the Director Plan require that
the exercise price of options be not less than the fair market value at the date of
grant. As of July 1, 1995, 125,250 options were exercisable and 468,188 options
were available for grant. The following table summarizes activity under the
Director Plan (in thousands, except per share amounts):
Options Outstanding
Number Price
of Shares Per Share Amount
Options outstanding at June 30, 1992 184 $ 5.25 –$14.63 $ 1,611
Cancelled or expired (1) 6.88 (9 )
Options outstanding at June 30, 1993 183 5.25 – 14.63 1,602
Granted 90 4.25 – 17.13 941
Exercised (53) 4.25 – 11.50 (388 )
Cancelled or expired (30) 12.88 (386 )
Options outstanding at June 30, 1994 190 4.25 – 17.13 1,769
Granted 40 14.00 – 17.75 614
Exercised (40) 4.25 – 7.44 (212 )
Cancelled or expired (20) 4.25 – 17.75 (279 )
Options outstanding at July 1, 1995 170 $ 4.88 – $17.13 $ 1,892
Stock Purchase Rights
In 1989, the Company implemented a plan to protect stockholders’rights in the
event of a proposed takeover of the Company. Under the plan, each share of the
Company’s outstanding common stock carries one Right to Purchase Series “A”
Junior Participating Preferred Stock (“the Right”). The Right enables the holder,
under certain circumstances, to purchase common stock of Western Digital or of
the acquiring company at a substantially discounted price ten days after a person
or group publicly announces it has acquired or has tendered an offer for 15% or
more of the Company’s outstanding common stock. The Rights are redeemable by
the Company at $.01 per Right and expire in 1999.
Employee Stock Purchase Plan
During 1994, the Company implemented an employee stock purchase plan
(“ESPP”) in accordance with Section 423 of the Internal Revenue Code whereby
eligible employees may authorize payroll deductions of up to 10% of their salary
to purchase shares of the Company’s common stock at 85% of the fair market
value of common stock on the date of grant or the exercise date, whichever is less.
Approximately 1.8 million shares of common stock have been reserved for issuance
under this plan. Approximately 484,000 shares were issued under this plan during
1995. No shares were issued during 1994.
Profit Sharing Plan
Effective July 1, 1991, the Company adopted an annual Profit Sharing Plan cover-
ing eligible domestic employees. During 1995, 1994 and 1993, the Company
authorized 8% of defined pre-tax profits to be allocated to the participants.
Payments to participants of the Profit Sharing Plan were $11.3, $7.4 and $1.2
million in 1995, 1994 and 1993, respectively.