Western Digital 2001 Annual Report Download - page 59

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WESTERN DIGITAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
Net undistributed earnings from international subsidiaries at June 29, 2001, on which no U.S. tax has
been provided, amounted to approximately $460 million. The net undistributed earnings are intended to
Ñnance local operating requirements. Accordingly, an additional United States tax provision has not been
made on these earnings.
At June 29, 2001, the Company had Federal and state net operating loss carryforwards of approximately
$900 million and $386 million, respectively. In addition, the Company had various Federal and state tax credit
carryforwards of approximately $42.7 million. The loss carryforwards expire in Ñscal years 2008 through 2021
and the credit carryforwards begin to expire in Ñscal year 2002.
Note 6. Shareholders' Equity
Equity Facility
Under an existing shelf registration (""equity facility''), the Company may issue shares of common stock
to institutional investors for cash. Shares sold under the equity facility are at the market price of the
Company's common stock less a discount ranging from 2.75% to 4.25%. During 2000, the Company issued
24.6 million shares of common stock under the equity facility for net cash proceeds of approximately
$111.8 million. During 2001, the Company issued 23.5 million shares of common stock under the equity
facility for net cash proceeds of approximately $110.5 million. As of June 29, 2001, the Company had
$167.7 million remaining under the equity facility.
Stock Reserved for Issuance
The following table summarizes all shares of common stock reserved for issuance at June 29, 2001 (in
thousands):
Number
of Shares
Issuable in connection with:
Convertible debentures ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 3,971
Exercise of stock options, including options available for grantÏÏÏÏ 44,255
Employee stock purchase plan ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 2,935
51,161
Employee Stock Purchase Plan
The Company has an employee stock purchase plan (""ESPP'') that operates 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 2.9 million shares of common stock remain reserved for issuance under this plan.
Approximately 1,002,000, 1,236,000 and 1,199,000 shares were issued under this plan during 1999, 2000 and
2001, respectively.
Stock Option Plans
Western Digital's Employee Stock Option Plan (""Employee Plan'') is administered by the Compensa-
tion Committee of the Board of Directors (""Compensation Committee''), which determines the vesting
provisions, the form of payment for the shares and all other terms of the options. Terms of the Employee Plan
require that the exercise price of options be not less than the fair market value of the common stock on the
date of grant. Options granted generally vest 25% one year from the date of grant and in twelve quarterly
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