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EXHIBIT 99.3
AMENDMENT NO. 2 TO RIGHTS AGREEMENT
This Amendment No. 2 to Rights Agreement (this "Amendment No. 2") by and
between Western Digital Corporation, a Delaware corporation (the "Corporation")
and American Stock Transfer & Trust Company, a New York corporation (the "Rights
Agent"), as amended, is effective as of April 6, 2001. Capitalized terms used
herein but not defined herein shall have their defined meanings set forth in the
Rights Agreement by and between the Corporation and the Rights Agent, effective
as of October 15, 1998 (the "Rights Agreement").
BACKGROUND
A. The Corporation and the Rights Agent entered into the Rights
Agreement effective as of October 15, 1998 and an Amendment to the Rights
Agreement.
B. The Board of Directors of the Corporation has approved the
adoption by the Corporation of a holding company organizational structure in
accordance with Section 251(g) of the Delaware General Corporation Law (the
"DGCL"). The holding company organizational structure will be effected pursuant
to an Agreement and Plan of Merger to Form Holding Company (the "Merger
Agreement"), among the Corporation (which will be renamed Western Digital
Technologies, Inc. at the effective time of the Merger), Western Digital
Holdings, Inc. ("Holdings," the new holding company which will be renamed
Western Digital Corporation at the effective time of the Merger), and WD Merger
Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Holdings
("Merger Sub"). The Merger Agreement provides for the merger of Merger Sub with
and into the Corporation, with the Corporation continuing as the surviving
corporation and as a wholly owned subsidiary of Holdings (the "Merger").
Pursuant to Section 251(g) of the DGCL, stockholder approval of the Merger is
not required. As a result of the Merger, which will be consummated on or about
April 6, 2001, each share of the Corporation's common stock, par value $.01 per
share ("Western Digital Common Stock") issued and outstanding or held in
treasury will be converted into one share of Holdings' common stock, par value
$.01 per share ("Holdings Common Stock").
C. In the Merger Agreement, the Corporation agrees to take all
actions necessary so that at the effective time of the Merger, the Rights
Agreement and all issued and outstanding preferred stock purchase rights issued
pursuant to the Rights Agreement ("Western Digital Rights") shall terminate. On
or prior to the effective time of the Merger, Holdings shall adopt a rights
agreement (the "Holdings Rights Agreement") with substantially the same terms as
the Rights Agreement and shall declare a dividend of one preferred stock
purchase right (a "Holdings Right") for each outstanding share of Holdings
Common Stock, which shall be distributed at the effective time of the Merger,
pursuant to the terms and conditions more fully set forth in the Holdings Rights
Agreement.
D. The Board of Directors of the Corporation has resolved that the
Rights Agreement shall be supplemented as set forth herein without the approval
of holders of certificates representing shares of Western Digital Common Stock.
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AGREEMENT
NOW, THEREFORE, the parties hereby agree as follows:
1. Pursuant to Section 27 of the Rights Agreement, and
notwithstanding any other provision in the Rights Agreement, as amended, it is
hereby agreed that:
(i) neither the execution of the Merger Agreement, nor the Merger
shall trigger any rights or obligations under the Rights Agreement, cause a
Distribution Date, Stock Acquisition Date, Section 11(a)(ii) Event or Section 13
Event to occur, or have any other effect on the Rights Agreement or the Western
Digital Rights; and
(ii) at the effective time of the Merger, without any further
action by the Board of Directors of the Corporation or the Rights Agent and
without any notice, the Rights Agreement and all issued and outstanding Western
Digital Rights shall terminate and expire and an Expiration Date shall occur,
without redemption or exchange of the Western Digital Rights.
2. Except as expressly set forth in this Amendment No. 2 all other
terms of the Rights Agreement, as previously amended, shall remain in full force
and effect.
3. This Amendment No. 2 shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to contracts made
and to be performed entirely within such State.
4. This Amendment No. 2 may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
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IN WITNESS WHEREOF, the Corporation and the Rights Agent have executed
this Amendment No. 2 effective as of the date first above written.
THE CORPORATION:
WESTERN DIGITAL CORPORATION,
A DELAWARE CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Xxxxxxx X. Xxxxxxxxx
Vice President, Law and Administration and
Secretary
THE RIGHTS AGENT:
AMERICAN STOCK TRANSFER & TRUST COMPANY,
A NEW YORK CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: Vice President
