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Table of Contents

                                                                    EXHIBIT 10.1

                              EMPLOYMENT AGREEMENT

        This Employment Agreement (the "Agreement") is entered into by and
between Western Digital Corporation (the "Company") and John Coyne
("Executive"), as of the 31st day of October, 2006 ("Effective Date").

        1. EMPLOYMENT.

        The Company hereby employs Executive and Executive hereby accepts such
employment, upon the terms and conditions hereinafter set forth including but
not limited to provisions governing early termination, from the Effective Date
to and including January 1, 2012 ("Employment Period"). Unless Executive's
employment is terminated pursuant to any early termination provision hereof or
the parties mutually agree otherwise in writing, Executive's employment with the
Company shall terminate without further action by either party on January 1,
2012.

        2. DUTIES.

                A. President and Chief Operating Officer. From the Effective
Date until January 1, 2007, Executive shall continue to serve as President and
Chief Operating Officer of the Company, and shall report to the Company's Chief
Executive Officer.

                B. President and Chief Executive Officer. From January 2, 2007,
through January 1, 2012, Executive shall serve as President and Chief Executive
Officer of the Company. In this capacity, Executive shall report to the Board of
Directors of the Company, and shall have such duties and responsibilities
consistent with his position as President and Chief Executive Officer as the
Board of Directors of the Company shall determine from time to time.

                C. Executive Commitment. Executive agrees to devote
substantially all of his time, energy and ability to the business of the
Company, subject to paragraph E of Section 3.

        3. COMPENSATION.

                A. Base Salary. From the Effective Date through January 1, 2007,
the Company will pay to Executive a base salary at the rate of $650,000 per
year. Effective January 2, 2007, the Company will pay to Executive a base salary
at the rate of $800,000 per year. Such salary shall be earned monthly and shall
be payable in periodic installments in accordance with the Company's customary
practices. Amounts payable shall be reduced by standard withholding and other
authorized deductions.

                B. Bonus. Executive's target annual bonus each fiscal year
during the Employment Period for purposes of the Company's semi-annual Incentive
Compensation Plan (ICP) bonus program for such fiscal period shall be 100% of
his semi-annual base salary from the Company in effect on the last day of such
fiscal period. In addition, concurrent with the execution of this Agreement,
Executive shall receive a Performance Cash Award, in the form attached hereto as
Exhibit "A" that provides an opportunity for



                                       1


a bonus with a target amount of $1,000,000 for the July 1, 2006, through June
29, 2007, performance period and shall receive a Performance Cash Award in the
form attached hereto as Exhibit "B" that provides an opportunity for a bonus
with a target amount of $1,000,000 for the July 1, 2006 through June 27, 2008
performance period, the corresponding performance objectives to be determined by
the Compensation Committee of the Board of Directors in its good faith
discretion. In addition, while employed by the Company under this Agreement,
Executive shall be eligible for and shall receive a Performance Cash Award
annually under the Company's Long Term Incentive award program with a target
amount of no less than $2,000,000. Each such award will be based on a 24-month
performance period. The first such Performance Cash Award will be awarded in
August or September 2007, and will be based on the performance period commencing
on the first day of fiscal year 2008 and ending on the last day of fiscal year
2009. The parties intend that the performance objectives for such annual awards
will be determined each year by mutual agreement between Executive and the
Compensation Committee of the Board of Directors following good faith
discussions and consideration of the Company's strategic and operational
initiatives. In the event that the parties cannot reach mutual agreement, the
performance objectives for the applicable award will be determined by the
Compensation Committee in its good faith discretion. The other terms and
conditions of such awards will be in the Company's standard form attached hereto
as Exhibit "A".

                C. Retirement and Welfare Benefit Plans; Fringe Benefits.
Executive (and, in the case of welfare benefit plans, his eligible dependents,
as the case may be) shall be eligible for participation in the retirement,
welfare, and fringe benefit plans, practices, policies and programs provided by
the Company on terms consistent with those generally applicable to the Company's
other senior executives and approved by the Compensation Committee of the Board
of Directors.

                D. Expenses. Executive shall be entitled to receive prompt
reimbursement for all reasonable employment expenses incurred by him in
accordance with the policies, practices and procedures as in effect generally
with respect to other senior executives of the Company.

                E. Vacation and Other Leave. From the Effective Date through
December 31, 2009, Executive shall receive paid vacation in an amount determined
by the Company's then-existing policies based upon Executive's years of service
with the Company. For each of calendar year 2010 and 2011, Executive shall
receive eight (8) weeks paid vacation. Such vacation shall be scheduled and
taken in accordance with the Company's standard vacation policies applicable to
Company executives. Executive shall also be entitled to all other holiday and
leave pay generally available to other executives of the Company.

                F. Modification. The Company reserves the right to modify,
suspend or discontinue any and all of the above plans, practices, policies and
programs at any time without recourse by Executive so long as such action is
taken generally with respect to other senior executives of the Company and does
not single out Executive.



                                       2


        4. RESTRICTED STOCK; OTHER EQUITY AWARDS.

                A. Restricted Stock Units. On January 31, 2007, the Company
shall grant to Executive an award of 1,100,000 restricted stock units
("RESTRICTED UNITS") in the form attached hereto as Exhibit "C" provided that
Executive is then employed as the President and Chief Executive Officer of the
Company. Such Restricted Units shall vest as follows: (i) Ten percent of such
Restricted Units shall vest on January 1, 2008; (ii) Ten percent of such
Restricted Units shall vest on January 1, 2009; (iii) Thirty percent of such
Restricted Units shall vest on January 1, 2010; (iv) Ten percent of such
Restricted Units shall vest on January 1, 2011; and (v) Forty percent of such
Restricted Units shall vest on January 1, 2012; provided, in the case of each
such vesting installment and except as expressly provided otherwise in Section 5
below, that Executive has remained continuously employed by the Company through
such vesting date. In the event of Executive's death after January 31, 2007,
while employed by the Company, an additional number of Restricted Units shall
accelerate and become vested on the date of Executive's death, with such number
of additional Restricted Units equal to: (1) the total number of Restricted
Units multiplied by a fraction (not greater than one), the numerator of which is
the total number of calendar days during the period commencing with January 31,
2007, through and including the date of Executive's death, (but not less than
182 days) and the denominator of which is the total number of calendar days
during the period commencing with January 31, 2007, through and including
January 1, 2012, less (2) the total number of Restricted Units that otherwise
vested on or before the date of Executive's death. The Restricted Units will be
evidenced by and subject to such other and further terms and conditions as are
set forth in a written restricted stock unit award agreement in the form
attached hereto as Exhibit "C".

                B. Stock Options. On January 31, 2007, and in each of the four
fiscal years commencing with fiscal year 2008, the Company shall grant to
Executive a nonqualified stock option (the "Option(s)") to purchase a number of
shares of Common Stock in the form attached hereto as Exhibit "D". The date of
the Option grants subsequent to January 2007 shall be at the same time as the
Company's annual grant of options to other members of senior management. If the
Company is in a blackout period (pursuant to the Company's policies on trading
Company securities applicable to the Company's executive officers generally) on
the applicable date, the Compensation Committee of the Board of Directors may,
in its discretion, delay the date of grant of the applicable Option until after
such blackout period ends, in which case the Compensation Committee shall
approve the grant promptly following the end of such blackout period (and the
date of grant of the Option shall be the date of such approval). The number of
shares of Common Stock subject to the January 31, 2007 Option will equal 120,000
(such number subject to proportionate and equitable adjustments for stock
splits, stock dividends, reverse stock splits, and similar changes in
capitalization). The number of shares of Common Stock subject to the subsequent
Options will be determined in the good faith discretion of the Compensation
Committee of the Board of Directors based on (among such other facts and
circumstances the Compensation Committee may determine to be relevant in the
circumstances) Executive's individual performance, the Company's performance,
and market benchmark comparisons of compensation data for chief executive
officers against both peer group and general industry survey data. The exercise



                                       3


price per share of the Option(s) will be equal to the fair market value
(determined consistently with the Company's Amended and Restated 2004
Performance Incentive Plan) of a share of Common Stock on the date of grant of
the Option(s). The Option(s) will be evidenced by and subject to such other and
further terms and conditions as set forth in a written stock option award
agreement in the form attached hereto as Exhibit "D".

                C. Future Award Eligibility. Executive shall also be eligible to
receive additional grants of stock options, restricted stock awards, and/or
other long-term incentives, each in the good faith discretion of the
Compensation Committee of the Board of Directors based on (among such other
facts and circumstances the Compensation Committee may determine to be relevant
in the circumstances) Executive's individual performance, the Company's
performance, and market benchmark comparisons of compensation data for chief
executive officers against both peer group and general industry survey data.

                D. Special Incentive Vesting and Exercisability. In the event
Executive remains employed by the Company as its President and Chief Executive
Officer through January 1, 2012, following the termination of Executive's
employment with the Company (regardless of the reason, other than a termination
by the Company for Cause (as defined in Section 5)), Executive will (i) be fully
vested in any stock options granted to him by the Company during the Employment
Period and Executive will have three years from the date of such termination to
exercise such stock options (subject to earlier termination on the expiration of
the maximum applicable term of such stock options or, as provided in the
applicable agreement evidencing such options and the equity incentive plan of
the Company under which they are granted, the occurrence of a change in control
of the Company and similar events) and (ii) be eligible to receive a pro-rata
portion of any outstanding Performance Cash Award equal to the amount that
Executive would have been entitled to had he continued to be employed through
the applicable payment date, multiplied by a fraction the numerator of which is
the number of days in the performance period that Executive was employed by the
Company and the denominator of which is the total number of days in the
performance period. Any such payment(s) shall be made at the same time as
amounts are paid generally with respect to the applicable performance period.

        5. TERMINATION.

                A. Death. This Agreement and Executive's employment shall
terminate automatically on the death of Executive.

                B. Disability. The Company, at its option, may terminate
Executive's employment upon the Disability of Executive. For purposes of this
Agreement, "Disability" shall mean physical or mental incapacity that renders
Executive unable to perform the normal and customary duties of employment of
Executive even with a reasonable accommodation for (A) 120 days in any twelve
(12) month period or (B) for a period of ninety (90) successive days.



                                       4


                C. Cause. The Company may terminate Executive's employment for
Cause. For purposes of this Agreement, "Cause" shall mean that the Company,
acting in good faith based upon the information then known to the Company,
determines that Executive has engaged in or committed: (i) willful misconduct,
(ii) fraud, (iii) failure or refusal to perform the duties of Chief Operating
Officer and President prior to January 2, 2007, or President and Chief Executive
Officer on or after January 2, 2007, as the case may be, or (iv) a conviction of
or a plea of nolo contendre to a felony.

                D. Other than Cause, Death, or Disability. The Company may
terminate Executive's employment at any time, with or without cause, upon 30
days' written notice.

                E. Obligations of the Company Upon Termination.

                        (i) Cause or Disability. If Executive's employment is
terminated by the Company for Cause or on account of Disability, Executive's
employment shall terminate without further obligations to Executive other than
for the timely payment of the sum of (i) Executive's annual base salary through
the date of termination to the extent not theretofore paid and (ii) any
compensation previously deferred by Executive in accordance with the Company's
deferred compensation plans (together with any accrued interest or earnings
thereon pursuant to the terms of the applicable plan) and any accrued vacation
pay, in each case to the extent not theretofore paid (the sum of the amounts
described in clauses (i) and (ii) shall be hereinafter referred to as the
"Accrued Obligations"). If it is subsequently determined that the Company did
not have Cause for termination under Section 5.C or Executive was not Disabled
as defined in Section 5.B, then the Company's decision to terminate shall be
deemed to have been made under Section 5.D, and the amounts payable under
Section 5.E(iii) shall be the only amounts Executive may receive for his
termination.

                        (ii) Death. If Executive's employment is terminated on
account of Executive's Death, Executive's employment shall terminate without
further obligations to Executive's heirs other than for the timely payment of
Accrued Obligations and the adjusted vesting of Restricted Units set forth in
Section 4.A above.

                        (iii) Other than Cause, Death, or Disability. If the
Company terminates Executive's employment for other than Cause (and other than
due to Executive's death or Disability) effective prior to January 1, 2012,
Executive's employment shall terminate without further obligations to Executive
other than:

                                (a) The Company's timely payment to Executive of
Accrued Obligations; and

                                (b) The Company's provision to Executive of the
Tier I benefits under the Company's then-existing Executive Severance Plan or,
if applicable, the benefits under the Company's Amended and Restated Change of
Control Severance Plan, provided that Executive satisfies all of the terms and
conditions of the applicable



                                       5


plan (including in the case of the Executive Severance Plan, but not limited to
the condition that Executive execute a general release in a form acceptable to
the Company).

                                (iv) Expiration. Upon the expiration of this
Agreement, Executive's employment shall terminate without further obligations to
Executive other than (i) the timely payment of Accrued Obligations, (ii) any
benefits or amounts due under Section 4(D) above, and (iii) eligibility to
receive an ICP bonus with respect to the first half of fiscal year 2012 in such
amount and at such time as ICP bonuses, if any, are determined on a Company-wide
basis.

                F. Exclusive Remedy. Executive agrees that the payments and
benefits contemplated by this Agreement shall constitute the exclusive and sole
remedy for any termination of his employment, and Executive covenants not to
assert or pursue any other remedies, at law or in equity, with respect to any
termination of employment.

        6. CONFIDENTIALITY AND INVENTION.

        Executive has previously executed an Employee Invention and
Confidentiality Agreement ("Invention Agreement"), dated March 3, 1997, which is
incorporated herein as if fully set forth. In the event of an inconsistency
between a provision of this Agreement and a provision of the Invention
Agreement, the provision of this Agreement controls.

        7. NON-INTERFERENCE.

        Executive promises and agrees that during the term of this Agreement,
and for a period of twenty-four (24) months thereafter, he will not influence or
attempt to influence any customer, supplier, or distributor of the Company to
alter or reduce its business relationship with the Company.

        8. LITIGATION ASSISTANCE.

        Executive agrees to cooperate with the Company in any actual or
threatened litigation that arises against or brought by the Company at any time
during or after the Employment Period, including but not limited to
participating in interviews with the Company's counsel to assist the Company in
any such litigation.

        9. ARBITRATION.

        Any controversy arising out of or relating to Executive's employment,
this Agreement, its enforcement or interpretation, or because of an alleged
breach, default, or misrepresentation in connection with any of its provisions,
shall be submitted to arbitration in Orange County, California, before a sole
arbitrator selected from Judicial Arbitration and Mediation Services, Inc.,
Orange County, California, or its successor ("JAMS"), or if JAMS is no longer
able to supply the arbitrator, such arbitrator shall be selected from ADR
Services, Inc., and shall be conducted in accordance with the provisions of
California Civil Procedure Code Sections 1280 et seq. as the exclusive remedy of
such dispute; provided, however, that provisional injunctive relief may, but
need not, be



                                       6


sought 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. 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 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 this
Agreement or Executive's employment.

        10. SUCCESSORS.

                A. This Agreement is personal to Executive and shall not,
without the prior written consent of the Company, be assignable by Executive.

                B. This Agreement shall inure to the benefit of and be binding
upon the Company and its successors and assigns and any such successor or
assignee shall be deemed substituted for the Company under the terms of this
Agreement for all purposes. As used herein, "successor" and "assignee" shall
include any person, firm, corporation or other business entity which at any
time, whether by purchase, merger or otherwise, directly or indirectly acquires
the stock of the Company or to which the Company assigns this Agreement by
operation of law or otherwise.

        11. WAIVER.

        No waiver of any breach of any term or provision of this Agreement shall
be construed to be, nor shall be, a waiver of any other breach of this
Agreement. No waiver shall be binding unless in writing and signed by the party
waiving the breach.

        12. MODIFICATION.

        This Agreement shall not be modified by any oral agreement, either
express or implied, and all modifications hereof shall be in writing and signed
by the parties hereto.

        13. SAVINGS CLAUSE.

        If any provision of this Agreement or the application thereof is held
invalid, the invalidity shall not affect other provisions or applications of the
Agreement which can be given effect without the invalid provisions or
applications and to this end the provisions of this Agreement are declared to be
severable.

        14. COMPLETE AGREEMENT.

        This Agreement (and all other agreements, exhibits, and schedules
referred to in this Agreement, including without limitation the Invention
Agreement) constitutes and contains the entire agreement and final understanding
concerning Executive's employment with the Company and the other subject matters
addressed herein between



                                       7


the parties. It is intended by the parties as a complete and exclusive statement
of the terms of their agreement. It supersedes and replaces all prior
negotiations and all agreements proposed or otherwise, whether written or oral,
concerning the subject matter hereof. Any representation, promise or agreement
not specifically included in this Agreement shall not be binding upon or
enforceable against either party. Notwithstanding the foregoing, this Agreement
shall not supersede and replace the Letter Agreement dated May 25, 2005 between
Executive and Western Digital Technologies, Inc. This is a fully integrated
agreement.

        15. GOVERNING LAW.

        This Agreement shall be deemed to have been executed and delivered
within the County of Orange, State of California and the rights and obligations
of the parties hereunder shall be construed and enforced in accordance with, and
governed by, by the laws of the State of California without regard to principles
of conflict of laws.

        16. CONSTRUCTION.

        Each party has cooperated in the drafting and preparation of this
Agreement. Hence, in any construction to be made of this Agreement, the same
shall not be construed against any party on the basis that the party was the
drafter. The captions of this Agreement are not part of the provisions hereof
and shall have no force or effect.

        17. COMMUNICATIONS.

        All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed to have been duly given if delivered or if
mailed by registered or certified mail, postage prepaid, addressed to Executive
at Western Digital Corporation, 20511 Lake Forest Drive, Lake Forest, California
92630, or addressed to the Company at: Western Digital Corporation, Attn.
Corporate Secretary, 20511 Lake Forest Drive, Lake Forest, California 92630.
Either party may change the address at which notice shall be given by written
notice given in the above manner.

        18. EXECUTION AND EFFECTIVE DATE.

        This Agreement is being executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument. Photographic copies of such signed counterparts may
be used in lieu of the originals for any purpose. Notwithstanding any earlier
execution of this Agreement by the Company and/or John Coyne, this Agreement
will be effective as of the date that the Company and Arif Shakeel, the
Company's current Chief Executive Officer, enter into an amendment of Mr.
Shakeel's Employment Agreement providing for the appointment of Mr. Shakeel to
the position of Special Advisor to the Chief Executive Officer, effective as of
January 2, 2007.


                       [Signatures on the following page.]



                                       8


        In witness whereof, the parties hereto have executed this Agreement as
of the date first above written.


                             THE COMPANY:


                             By: /s/ Arif Shakeel
                                -----------------------------------------

                             Name:  Arif Shakeel

                             Title: Chief Executive Officer


                             EXECUTIVE:

                             /s/ John Coyne
                             --------------------------------------------
                             John Coyne



                                      S-1

                                                                    EXHIBIT 10.2

- --------------------------------------------------------------------------------

WESTERN(R)                                          WESTERN DIGITAL CORPORATION
DIGITAL                                             ID: 95-2657125
                                                    P.O. Box 19665
                                                    Lake Forest, CA  92630-7741
                                                    (949) 672-7000 x 27985/27986

NOTICE OF GRANT OF STOCK UNITS
AND STOCK UNIT AWARD AGREEMENT



JOHN COYNE                              AWARD NUMBER: <>
<>                                 PLAN:         <>
<>                                 ID:           <>
<>, <> <>

- --------------------------------------------------------------------------------

Congratulations! Effective January 31, 2007, you have been granted stock units
of Western Digital Corporation. These stock units were granted under the 2004
Performance Incentive Plan (the "Plan").1

VESTING2:





         Units                Vest Date
         -----                ---------
                        
        110,000            January 1, 2008
        110,000            January 1, 2009
        330,000            January 1, 2010
        110,000            January 1, 2011
        440,000            January 1, 2012


- --------------------------------------------------------------------------------

Your stock unit award is subject to the terms and conditions of this Notice, the
attached Terms and Conditions for Stock Unit Awards (the "Terms") and the Plan.
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 Terms. The 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 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
Company's Stock Plans Administrator.

- --------------------------------------------------------------------------------


- ----------

1 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).

2 The stock units covered by the award are subject to forfeiture under Section 7
of the attached Terms and Conditions for Stock Unit Awards.





[WESTERN DIGITAL LOGO]

Western Digital Corporation   20511 Lake Forest Drive
Lake Forest, California 92630   Telephone 949 672-7000

                            TERMS AND CONDITIONS FOR
                                STOCK UNIT AWARDS
              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
Western Digital Corporation's (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. 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
Terms and Conditions for Stock Unit Awards (these "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
Terms, the Plan or these Terms, as applicable, shall control. To the extent any
terms and provisions in these 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.

2.      AWARD AGREEMENT

The Notice and these 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, 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.

4.      VESTING

Except as otherwise provided in this Award Agreement, the Award shall vest and
become nonforfeitable in percentage installments of the aggregate number of
Stock Units as set forth in the Notice.





An Award may vest and become payable in connection with the occurrence of
certain events involving the Corporation as provided for in Section 7 of the
Plan. Without limiting the foregoing but subject to Sections 7.5, 7.6 and 7.7 of
the Plan, to the extent that the Award is outstanding and otherwise unvested
immediately prior to the occurrence of a Change in Control Event, the Award
shall vest and become payable as to the outstanding and otherwise unvested Stock
Units upon the occurrence of the Change in Control Event. Notwithstanding the
foregoing or anything in this Award Agreement or the Plan, if the event giving
rise to any accelerated vesting pursuant to Section 7 of the Plan is not also a
"change in control event" of the Corporation for purposes of Section 409A of the
Code, then payment with respect to the Award shall not be made until such Stock
Units would have become vested and payable without regard to this Section 4 or
Section 7 of the Plan.

The vesting schedule requires continued employment or service through each
applicable vesting date as a condition to the vesting of the applicable
installment of the Award and the rights and benefits under this Award Agreement.
Employment or service for only a portion of the 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 or services as provided in Section 7 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. If the Participant has not made a
deferral election with respect to the Stock Units, then 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. If the Participant has made a
deferral election with respect to the Stock Units, then the Stock Units credited
pursuant to the foregoing provisions of this Section 5 shall be credited under,
and paid in an equivalent number of shares of Common Stock in accordance with
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 Section 3 or 4 above, on or within fifteen (15) business
days following the vesting of any Stock Units granted (or credited pursuant to
Section 5) to the Participant (whether pursuant to Section 4 or Section 7 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 that
vest on the applicable vesting date (including any Stock Units credited as
dividend equivalents pursuant to Section 5 with respect to the Stock Units that
vest), subject to adjustment as provided in Section 7 of the Plan. The
Corporation's obligation to deliver shares of Common Stock with respect to
vested Stock Units 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. 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 7
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).

7.      TERMINATION OF EMPLOYMENT

Except as otherwise expressly provided in this Section 7 and subject to earlier
vesting as provided in Section 4 and Section 8 hereof, if the Participant ceases
to be employed by or to provide services to the Corporation or its Subsidiaries
(regardless of the reason for such termination, whether with or without cause,
voluntarily or involuntarily, or due to disability), the Participant's Stock
Units shall be forfeited to the Corporation to the extent



                                       2


such Stock Units have not become vested upon the date the Participant's
employment or services terminate. Notwithstanding anything to the contrary
contained herein, in the event the Participant's employment by or services to
the Corporation or any of its Subsidiaries is terminated (i) on account of the
Participant's death or (ii) by the Corporation or any of its Subsidiaries
without Cause (as such term is defined in that certain Employment Agreement,
dated as of the date hereof, by and between the Participant and the Corporation
(the "Employment Agreement") (and not on account of the Participant's death or
Disability (as such term is defined in the Employment Agreement)), a portion of
the outstanding and otherwise unvested Stock Units shall automatically become
vested as of such date of death or termination, as the case may be, as set forth
in the remaining provisions of this Section 7, 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 or providing services to the Corporation or any of its Subsidiaries,
the number of Stock Units that shall become vested on the date of the
Participant's death equals: (a) the total number of Stock Units subject to the
Award multiplied by a fraction (not greater than one), the numerator of which is
the total number of calendar days during the period commencing on the date
hereof through and including the date of the Participant's death (but not less
than 182 days), and the denominator of which is the total number of calendar
days during the period commencing with the date hereof through and including
January 1, 2012, less (b) the total number of Stock Units subject to the Award
that otherwise vested on or before the date of the Participant's death. In the
event the Participant's employment is terminated by the Corporation or any of
its Subsidiaries without Cause (and not on account of the Participant's death or
Disability), the number of Stock Units that shall become vested on the date of
such termination equals the number of Stock Units that are then scheduled to
vest (assuming the Participant's employment did not terminate) during the
six-month period following the date of such termination. The provisions of this
Section 7 are not intended to supersede any rights or benefits to which the
Participant may become entitled under the Corporation's Executive Severance Plan
or Amended and Restated Change of Control Severance Plan (collectively, the
"Severance Plans"); provided, however, that in no event shall the Participant
become entitled to any duplication of benefits under the Award Agreement and
under the Severance Plans.

8.      ADJUSTMENTS

The Administrator may accelerate payment and vesting of the Stock Units in such
circumstances as it, in its sole discretion, may determine. In addition, 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.

9.      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.

10.     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.



                                       3


11.     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.

12.     RIGHTS AS A STOCKHOLDER

        Subject to the provisions of the Plan, the Notice and these 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.

13.     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 13.

14.     ARBITRATION

Any controversy arising out of or relating to this Award Agreement (including
these 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 Sections 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 14).



                                       4


15.     GOVERNING LAW

This Award Agreement, including these 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.

16.     SEVERABILITY

If the arbitrator selected in accordance with Section 14 or a court of competent
jurisdiction determines that any portion of this Award Agreement (including
these 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.

17.     ENTIRE AGREEMENT

This Award Agreement (including these Terms), the Plan and the Employment
Agreement 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. 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.

18.     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.



                                       5

                                                                    EXHIBIT 10.3

[WESTERN DIGITAL LOGO]                               WESTERN DIGITAL CORPORATION
                                                     20511 Lake Forest Drive
                                                     Lake Forest, CA 92630-7741

                         NOTICE OF GRANT OF STOCK OPTION
                              AND OPTION AGREEMENT

ID: 95-2647125






JOHN COYNE                                OPTION NO.:  #######
ADDRESS LINE 1                            PLAN:  2004 PERFORMANCE INCENTIVE PLAN
CITY, STATE ZIP                           ID:  ####


Congratulations! Effective January 31, 2007, you have been granted a
nonqualified stock option to buy 120,000 shares of Western Digital Corporation
stock at <<$ option price>> per share. The option was granted under the Amended
and Restated 2004 Performance Incentive Plan (the "Plan").1


VESTING:




        Shares1       Vest Type     Full Vesting   Expiration Date2
        -------       ---------     ------------   ----------------
                                          
        30,000        On Vest Date  01/31/2008     01/31/2017
        90,000        Quarterly     01/31/2011     01/31/2017


Your option is subject to the terms and conditions of this Notice, the attached
Terms and Conditions for Stock Options (the "Terms"), and the Plan. By accepting
the option, you are agreeing to the terms of the option as set forth in those
documents. You should read the Plan, the Prospectus for the Plan, and the Terms.
The Terms and the Plan are each incorporated into (made a part of) this Notice
by this reference. You do not have to accept your option. If you do not agree to
the terms of your option, 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 Terms have been
provided to you. If you need another copy of any of these documents, or if you
would like to confirm that you have the most recent version, you may obtain
another copy in the Company Library on the E*TRADE web site. These documents are
also available on the Western Digital Intranet site under Legal.




1.  The number of shares subject to the option and the per-share exercise price
    of the option are subject to adjustment under Section 7.1 of the Plan (for
    example, and without limitation, in connection with stock splits).
2.  The option is subject to early termination under Section 5 of the attached
    Terms and Conditions for Stock Options.



                                       1


[WESTERN DIGITAL LOGO]

Western Digital Corporation   20511 Lake Forest Drive
Lake Forest, California 92630   Telephone 949 672-7000


                     TERMS AND CONDITIONS FOR STOCK OPTIONS
              Amended and Restated 2004 Performance Incentive Plan



1.      OPTION SUBJECT TO AMENDED AND RESTATED 2004 PERFORMANCE INCENTIVE PLAN.

The option (the "Option") referred to in the attached Notice of Grant of Stock
Option and Option Agreement (the "Notice") was issued under Western Digital
Corporation's (the "Corporation's") Amended and Restated 2004 Performance
Incentive Plan (the "Plan"). The Option is subject to the terms and provisions
of the Notice, these Terms and Conditions for Stock Options (these "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 Terms, the Plan or these Terms, as applicable, shall control. To
the extent any terms and provisions in these Terms conflict with the terms and
provisions of the Plan, the Plan shall control. The holder of the Option is
referred to herein as the "Participant." Capitalized terms not defined herein
have the meanings set forth in the Plan.

Unless otherwise expressly provided in other sections of these Terms, provisions
of the Plan that confer discretionary authority on the Board or the
Administrator do not and shall not be deemed to create any rights in the
Participant unless such rights are expressly set forth herein or are otherwise
in the sole discretion of the Board or the Administrator so conferred by
appropriate action of the Board or the Administrator under the Plan after the
grant date of the Option.


2.      OPTION AGREEMENT.

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


3.      TYPE OF STOCK OPTION

The Notice indicates whether the Option is intended to qualify as an incentive
stock option (an "ISO") under the Internal Revenue Code of 1986, as amended (the
"Code"), or is a nonqualified stock option (an option that is not an ISO). ISOs
are subject to additional requirements under the Code as generally described in
Section 5.1 of the Plan. If the aggregate fair market value of the shares with
respect to which ISOs (whether granted under the Option or otherwise) first
become exercisable by the Participant in any calendar year exceeds $100,000, as
measured on the applicable option grant dates and as determined in accordance
with Code Section 422 and the regulations promulgated thereunder, the
limitations of Section 5.1.2 of the Plan shall apply and to such extent the
Option will be rendered a nonqualified stock option.


4.      VESTING

The Option shall vest and become exercisable in percentage installments of the
aggregate number of shares subject to the Option as set forth in the Notice. The
first vesting installment of the Option shall be a fixed installment covering
the number of shares, and vesting on the fixed vesting date, set forth in the
first line of the Notice under "Vesting." In each case, the Option is subject to
earlier termination in accordance with Section 5.



                                       1


Notwithstanding the foregoing but subject to Sections 7.5, 7.6 and 7.7 of the
Plan, to the extent that the Option is outstanding and otherwise unvested
immediately prior to the occurrence of a Change in Control Event, the Option
shall vest and become exercisable upon the occurrence of the Change in Control
Event. This acceleration provision shall not in any way limit the Corporation's
ability to terminate the Option in connection with a Change in Control Event as
provided in Section 7.4 of the Plan; provided that, in any such circumstances,
the Optionee is given reasonable advance notice of the impending termination and
a reasonable opportunity to exercise the outstanding portion of the Option in
accordance with its terms (subject to Sections 7.5, 7.6 and 7.7 of the Plan,
after giving effect to the acceleration of vesting) before the termination of
the Option in such circumstances (except that in no case shall more than ten
days' notice of accelerated vesting and the impending termination be required
and any acceleration may be made contingent upon the actual occurrence of the
event).

The Option may be exercised only to the extent it is vested and exercisable. To
the extent that the Option is vested and exercisable, the Participant has the
right to exercise the Option (to the extent not previously exercised), and such
right shall continue, until the expiration or earlier termination of the Option
as provided in Section 5. Fractional share interests shall be disregarded, but
may be cumulated.

The vesting schedule requires continued employment or service through each
applicable vesting date as a condition to the vesting of the applicable
installment of the Option and the rights and benefits under this Option
Agreement. Employment or service for only a portion of the 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 or services as provided in Section 6 below
or under the Plan.


5.      EXPIRATION OF OPTION

The Option shall expire and the Participant shall have no further rights with
respect thereto upon the earliest to occur of (a) the termination of the Option
as provided in Section 6 below, (b) the termination of the Option as provided in
Section 7.4 of the Plan, or (c) the Expiration Date set forth in the Notice. The
Option may not be exercised at any time after a termination or expiration of the
Option.


6.      TERMINATION OF EMPLOYMENT, TOTAL DISABILITY OR DEATH

The Option shall be exercisable by the Participant (or his or her permitted
successor in interest) following the Participant's termination of employment
only to the extent provided below in this Section 6. Except as provided in
Section 6(f) below, 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." In each case
described below, the Option shall be subject to earlier termination as
contemplated by Section 5.

(a) Termination of Employment Generally. In the event the Participant ceases to
be an employee of the Corporation or any of its Subsidiaries for any reason
(other than a termination of employment by the Corporation or one of its
Subsidiaries for Cause (as such term is defined in that certain Employment
Agreement, dated as of October 31, 2006, by and between the Participant and the
Corporation (the "Employment Agreement")), due to the Participant's death or
Retirement (as defined below), or at a time when the Participant is Totally
Disabled (as defined below)), the Option, to the extent then otherwise scheduled
to vest (assuming the Participant's employment by the Corporation did not
terminate) in the six-month period following the Participant's termination,
shall become vested on the Participant's Severance Date. In addition, in the
event of such a termination, the Option shall terminate on the Participant's
Severance Date to the extent that it is not vested and exercisable on that date
(after giving effect to the preceding sentence) and, to the extent that the
Option is exercisable by the Participant on the Participant's Severance Date, it
may be exercised by the Participant at any time within three months following
the Participant's Severance Date. The Option, to the extent exercisable for the
three-month period following the Participant's Severance Date and not exercised
during such period, shall terminate at the close of business on the last day of
the three-month period.

(b) Total Disability. In the event that the Participant ceases to be an employee
of the Corporation or any of its Subsidiaries at a time when the Participant is
Totally Disabled and is not eligible to Retire, the Option shall



                                       2


terminate on the Participant's Severance Date to the extent that it is not
vested and exercisable on that date. In such circumstances, or in the event that
the Participant incurs such a Total Disability within not more than three months
of the Participant's Severance Date if the termination of the Participant's
employment was for any reason other than a termination of employment by the
Corporation or one of its Subsidiaries for Cause, the Option may, to the extent
the Option was exercisable by the Participant on the Participant's Severance
Date, be exercised by the Participant (or, if the Participant is then
incapacitated, by the Participant's personal representatives, heirs, or
legatees) at any time during the one-year period following the Participant's
Severance Date. The Option, to the extent exercisable for the one-year period
following the Participant's Severance Date and not exercised during such period,
shall terminate at the close of business on the last day of the one-year period.
For purposes of the Option, "Total Disability" (which term shall include
"Totally Disabled") means a "permanent and total disability" within the meaning
of Section 22(e)(3) of the Code.

(c) Death. If the Participant dies while he or she is an employee of the
Corporation or any of its Subsidiaries, the Option (to the extent outstanding
and not previously vested and exercisable) shall vest and become exercisable on
the Participant's Severance Date and shall continue to be exercisable by the
Participant's personal representatives, heirs or legatees, as applicable, at any
time during the three-year period following the Participant's Severance Date.
The Option, to the extent exercisable for the three-year period following the
Participant's Severance Date and not exercised during such period, shall
terminate at the close of business on the last day of the three-year period.

(d) Retirement. If the Participant Retires from the Corporation or one of its
Subsidiaries, the Option (to the extent outstanding and not previously vested
and exercisable) shall vest and become exercisable on the Participant's
Severance Date and shall continue to be exercisable by the Participant (or if
the Participant is then deceased, by the Participant's personal representatives,
heirs or legatees, as applicable) at any time during the three-year period
following the Participant's Severance Date. The Option, to the extent
exercisable for the three-year period following the Participant's Severance Date
and not exercised during such period, shall terminate at the close of business
on the last day of the three-year period. Notwithstanding the foregoing, in the
event a Retired Participant provides services to a competitor of the Corporation
or any of its Subsidiaries as an employee, consultant, director, officer,
representative, independent contractor or otherwise, or otherwise competes with
the business of the Corporation or its Subsidiaries (in each case as determined
by the Administrator its sole discretion), the Option, to the extent not
previously exercised, shall immediately terminate. In addition, in such event
the Corporation shall have the right to recover any profits realized by such
Retired Participant as a result of any exercise of the Option during the
six-month period prior to the date such Retired Participant commenced providing
such services to a competitor. For this purpose, the Participant shall be deemed
to have "Retired" (which term shall include "Retirement," "Retire" and
"Retires") if the Participant retires from employment with the Corporation or
one of its Subsidiaries for any reason other than Cause after satisfying all of
the following at the time of such retirement: (i) the Participant is at least 65
years of age, (ii) the Participant's age plus total years of continuous service
with the Corporation or any of its Subsidiaries (as determined by the
Administrator in its sole discretion) totals at least 75, and (iii) the
Participant has five (5) or more years of continuous service with the
Corporation or any of its Subsidiaries (as determined by the Administrator in
its sole discretion) ending on the date of such retirement. For purposes of
calculating "age plus total years of continuous service" under clause (ii)
above, fractional years shall be disregarded but may be cumulated (so that, by
way of example only, a Participant who is age 65 and 6 months with 9 years and 6
months of continuous service would satisfy the requirements of clause (ii),
while a Participant who is age 65 and 6 months with 9 years and 5 months of
continuous service would not satisfy the requirements of clause (ii)). For
purposes of calculating the Participant's "years of continuous service" under
clause (ii) or clause (iii) above, in no event shall the Participant accrue more
than one year of service with respect to any period of twelve consecutive months
(that is, concurrent employment by both the Corporation and one or more of its
Subsidiaries, or by multiple Subsidiaries, for a month shall not be counted as
more than one month of service).

(e) Termination for Cause. Notwithstanding the foregoing provisions of this
Section 6, if the Participant's employment with the Corporation or any of its
Subsidiaries is terminated by the Corporation or one of its Subsidiaries for
Cause, the Option (whether or not all or any portion of such Option is then
vested and exercisable) shall immediately terminate on the Participant's
Severance Date.

(f) Special Incentive Vesting and Exercisability. In the event the Participant
remains employed by the Corporation as its President and Chief Executive Officer
through January 1, 2012, thereafter upon the termination of



                                       3


the Participant's employment with the Corporation or any of its Subsidiaries
(for any reason other than a termination by the Corporation or any of its
Subsidiaries for Cause), the Option (and any other stock options granted to the
Participant during the Employment Period (as defined in the Employment
Agreement)) shall become fully vested as of the Participant's Severance Date,
and it may be exercised by the Participant at any time within three years
following the Participant's Severance Date. The Option, to the extent
exercisable for the three-year period following the Participant's Severance Date
and not exercised during such period, shall terminate at the close of business
on the last day of the three-year period.

(g) Continuation of Services. If the Participant's employment with the
Corporation or any of its Subsidiaries terminates (regardless of the reason)
but, immediately thereafter, the Participant continues to render services to the
Corporation or any of its Subsidiaries as an employee, director or consultant,
such Participant's Severance Date for purposes of the Option shall not be the
date such Participant's employment terminates, but instead shall be the last day
that the Participant either is employed by or actually renders services to the
Corporation or any of its Subsidiaries. As provided in Section 6.1 of the Plan,
the Administrator shall be the sole judge for purposes of the Option of whether
the Participant continues to render services the Corporation or its Subsidiaries
and the date, if any, upon which such services shall be deemed to have
terminated.

(h) Exercise Period for ISOs. Notwithstanding any post-termination exercise
period provided for herein or in the Plan, the Option will qualify as an ISO
only if it is exercised within the applicable exercise periods for ISOs under,
and meets all of the other requirements of, the Code. If the Option is not
exercised within the applicable exercise periods for ISOs or does not meet such
other requirements, the Option will be rendered a nonqualified stock option.

(i) No Duplication of Benefits. The provisions of this Section 7 are not
intended to supersede any rights or benefits to which the Participant may become
entitled under the Corporation's Executive Severance Plan or Amended and
Restated Change of Control Severance Plan (collectively, the "Severance Plans");
provided, however, that in no event shall the Participant become entitled to any
duplication of benefits under the Option Agreement and under the Severance
Plans.


7.      EXERCISE OF OPTION

The Option shall be exercisable by the delivery to the Secretary of the
Corporation (or such other person as the Administrator may require pursuant to
such administrative exercise procedures as the Administrator may implement from
time to time) of:

        -       a written notice stating the number of shares of Common Stock to
                be purchased pursuant to the Option or by the completion of such
                other administrative exercise procedures as the Administrator
                may require from time to time,

        -       payment in full for the purchase price (the per-share exercise
                price of the Option multiplied by the number of shares to be
                purchased) in cash, check or by electronic funds transfer to the
                Corporation, or (subject to compliance with all applicable laws,
                rules, regulations and listing requirements and further subject
                to such rules as the Administrator may adopt as to any non-cash
                payment) in shares of Common Stock already owned by the
                Participant, valued at their fair market value on the exercise
                date, provided, however, that any shares initially acquired upon
                exercise of a stock option or otherwise from the Corporation
                must have been owned by the Participant for at least six (6)
                months before the date of such exercise;

        -       any written statements or agreements required by the
                Administrator pursuant to Section 8.1 of the Plan; and

        -       satisfaction of the tax withholding provisions of Section 8.5 of
                the Plan.



                                       4


The Administrator also may, but is not required to, authorize a non-cash payment
alternative by notice and third party payment in such manner as may be
authorized by the Administrator.

The Option will qualify as an ISO only if it meets all of the applicable
requirements of the Code.


8.      NONTRANSFERABILITY

The Option and any other rights of the Participant under this Option Agreement
or the Plan are nontransferable and exercisable only by the Participant, except
as set forth in Section 5.7 of the Plan. For purposes of clarity, the
Administrator has not authorized any transfer exceptions as contemplated by
Section 5.7.2 of the Plan.


9.      NO RIGHT TO EMPLOYMENT

Nothing contained in this Option Agreement or the Plan constitutes a continued
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.


10.     RIGHTS AS A STOCKHOLDER

Neither the Participant nor any beneficiary or other person claiming under or
through the Participant shall have any right, title, interest or privilege in or
to any shares of Common Stock subject to the Option except as to such shares, if
any, as shall have been actually issued to such person and recorded in such
person's name following the exercise of the Option or any portion thereof.


11.     NOTICES

Any notice to be given under the terms of this Option 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 11.


12.     ARBITRATION

Any controversy arising out of or relating to this Option Agreement (including
these 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 or claim arising out of or related to the
Option or the Participant's employment, 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 Sections
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 Option Agreement in a court of law while
arbitration proceedings are pending, and any provisional injunctive relief



                                       5


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 Option, the Participant consents
to all of the terms and conditions of this Option Agreement (including, without
limitation, this Section 12).


13.     GOVERNING LAW

This Option Agreement, including these 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.


14.     SEVERABILITY

If the arbitrator selected in accordance with Section 12 or a court of competent
jurisdiction determines that any portion of this Option Agreement (including
these Terms) or the Plan is in violation of any statute or public policy, then
only the portions of this Option Agreement or the Plan, as applicable, which are
found to violate such statute or public policy shall be stricken, and all
portions of this Option 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 Option 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.


15.     ENTIRE AGREEMENT

This Option Agreement (including these Terms), the Plan and the Employment
Agreement 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. The Plan and this Option 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.


16.     SECTION HEADINGS

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




                                       6

                                                                    EXHIBIT 10.4

                        AMENDMENT TO EMPLOYMENT AGREEMENT


        This Amendment to Employment Agreement ("Amendment") is entered into by
and between Western Digital Corporation (the "Company") and Arif Shakeel
("Executive"), as of the 31st day of October, 2006.

        Company and Executive hereby amend Executive's August 25, 2005
Employment Agreement (the "Employment Agreement") as follows:

        1. Amendment of Section 1 (Employment). Section 1 of the Employment
Agreement is hereby amended and restated in its entirety to provide as follows:

            "1. EMPLOYMENT.

                The Company hereby employs Executive and Executive hereby
        accepts such employment, upon the terms and conditions hereinafter set
        forth, from the Effective Date to and including June 29, 2007
        ("Employment Period"). Executive and Company agree that this Agreement
        shall expire and Executive's employment with the Company shall terminate
        at the close of business on June 29, 2007, without further action by
        either Company or Executive."

        2. Amendment of Section 2 (Duties). Section 2 of the Employment
Agreement is hereby amended and restated in its entirety to provide as follows:

            "2. DUTIES.

                A. President. From the Effective Date until September 30, 2005,
        Executive shall continue to serve as President and Chief Operating
        Officer of the Company, and shall report to the Company's Chief
        Executive Officer.

                B. President and Chief Executive Officer. From October 1, 2005
        through May 31, 2006, Executive shall serve as President and Chief
        Executive Officer of Western Digital Corporation. From June 1, 2006
        through January 1, 2007, Executive shall serve as Chief Executive
        Officer of Western Digital Corporation. In these capacities, Executive
        shall report to the Board of Directors, and shall have such duties and
        responsibilities consistent with his positions as President and/or Chief
        Executive Officer as the Board of Directors of the Company shall
        determine from time to time.

                C. Special Advisor to the Chief Executive Officer. From January
        2, 2007 through June 29, 2007, Executive shall serve as Special Advisor
        to the Chief Executive Officer. In this capacity, Executive shall report
        to the Board of Directors of the Company and shall provide advice and
        counsel to the Chief Executive Officer with respect to strategic,
        management, and operational matters.

                D. Executive agrees to devote substantially all of his time,
        energy and ability to the business of the Company, subject to paragraph
        E of Section 3."



                                       1


        3. Amendment of Section 3 (Compensation). Section 3.A of the Employment
Agreement is hereby amended and restated in its entirety to provide as follows:

                "A. Base Salary. From the Effective Date through September 30,
        2005, the Company will pay to Executive a base salary at the rate of
        $700,000 per year. From October 1, 2005 through June 29, 2007, the
        Company will pay to Executive a base salary at the rate of $800,000 per
        year. Such salary shall be earned monthly and shall be payable in
        periodic installments in accordance with the Company's customary
        practices. Amounts payable shall be reduced by standard withholding and
        other authorized deductions."

        4. Equity Awards.

                (a) Notwithstanding anything in the Employment Agreement to the
contrary, and subject to Executive's continued employment with the Company
through June 29, 2007, or except as otherwise expressly provided in Section
5.C(ii) of the Employment Agreement or in the applicable restricted stock award
agreement: (i) 158,333 restricted shares of Common Stock of the Company that
comprise a portion of the restricted stock award previously granted by the
Company to the Executive on January 20, 2005 that are scheduled to vest on July
31, 2007 shall become fully vested on June 29, 2007; and (ii) 659,200 restricted
shares of Common Stock of the Company that comprise a portion of the restricted
stock award previously granted by the Company to the Executive on August 25,
2005 pursuant to Section 4.A of the Employment Agreement that are scheduled to
vest on January 1, 2008 shall become fully vested on June 29, 2007.

                (b) Notwithstanding anything in the Employment Agreement to the
contrary, the following awards are hereby terminated and Executive shall have no
further rights with respect thereto or in respect thereof: (i) the stock options
previously granted by the Company to Executive that are currently outstanding
but only to the extent that such options are scheduled (without giving effect to
any accelerated vesting provision) to vest after June 29, 2007 and before
January 1, 2008; and (ii) 90,800 restricted shares of Common Stock of the
Company that comprise a portion of the restricted stock award previously granted
by the Company to the Executive on August 25, 2005 pursuant to Section 4.A of
the Employment Agreement that were scheduled to vest on January 1, 2008 (which
shares are hereby transferred from the Executive to the Company). Executive
shall promptly deliver to the Company any share certificates evidencing the
shares of restricted stock covered by clause (ii) above and shall timely provide
the Company with such additional documents of transfer that the Company may
reasonably request to confirm the transfer of such shares to the Company.

        5. Amendment of Section 5 (Termination).

9               (a) The definition of "Cause" in the second sentence of Section
5.A of the Employment Agreement is hereby amended and restated in its entirety
to provide as follows:

                  "'Cause' shall mean that the Company, acting in good faith
        based upon the information then known to the Company, determines that
        Executive has engaged in or committed: (i) willful misconduct, (ii)
        fraud, (iii) failure or refusal to perform the duties



                                       2


        of Chief Executive Officer or Special Advisor to the Chief Executive
        Officer, as the case may be, or (iv) a conviction or plea of nolo
        contendre to a felony."

                (b) The first sentence of Section 5.C(ii)(b) of the Employment
Agreement is hereby amended and restated in its entirety to provide as follows:

                "(b) accelerated vesting of any and all options and other
        equity-based awards granted by the Company that are then outstanding and
        not otherwise fully vested, but only to the extent such awards would
        have otherwise become vested had Executive remained employed by the
        Company through June 29, 2007."

                (c) Section 5.C of the Employment Agreement is hereby amended to
add the following provision as Section 5.C(iii) of the Employment Agreement:

                "(iii) Expiration. Upon the expiration of this Agreement, this
        Agreement shall terminate without further obligations to Executive other
        than the timely payment of Accrued Obligations and the payment to
        Executive of an Incentive Compensation Plan ("ICP") bonus with respect
        to the second half of fiscal year 2007 at such time and in such amount
        as determined by the Compensation Committee of the Board of Directors on
        a Company-wide basis."

        6. Effective Date of Amendment. Notwithstanding any earlier execution of
this Amendment by the Company and/or Arif Shakeel, this Amendment will be
effective as of the date that the Company and John Coyne, the Company's current
President and Chief Operating Officer, enter into an agreement providing for the
appointment of John Coyne to the position of President and Chief Executive
Officer, effective as of January 2, 2007.

        7. Miscellaneous. Any capitalized term used in this Amendment that is
not defined in this Amendment shall have the definition of such term as set
forth in the Employment Agreement. Except as modified by this Amendment, all
other terms and conditions of the Employment Agreement remain valid and in full
force and effect. If any provision of this Amendment is inconsistent with any
provision of the Employment Agreement, the provisions of this Amendment shall
govern.



                 [Remainder of Page Intentionally Left Blank.]



                                       3


        In witness whereof, the parties hereto have executed this Amendment as
of the date first above written.


                             THE COMPANY:


                             By: /s/ Raymond M. Bukaty
                                --------------------------------------------

                             Name:  Raymond M. Bukaty

                             Title: Senior Vice President, Administration,
                                    General Counsel and Secretary


                             EXECUTIVE:

                             /s/ Arif Shakeel
                             -----------------------------------------------
                             Arif Shakeel



                                       4

                                                                    Exhibit 99.1

Company contacts:
Bob Blair
Investor Relations
949.672.7834
robert.blair@wdc.com

Steve Shattuck
Public Relations
949.672.7817
steve.shattuck@wdc.com


FOR IMMEDIATE RELEASE:


                   JOHN COYNE TO BECOME WESTERN DIGITAL CEO;
                  ARIF SHAKEEL TO REMAIN IN ADVISORY CAPACITY
                           AND ON BOARD OF DIRECTORS

LAKE FOREST, Calif. -- Nov. 2, 2006 -- Western Digital Corporation (NYSE: WDC)
today announced that John Coyne will become chief executive officer of the
company on January 2, 2007 and that current chief executive Arif Shakeel will
remain with the company in an advisory capacity through June 2007. Coyne, 56,
currently president and chief operating officer, will retain the title of
president when he becomes chief executive officer. He has joined the board of
directors and will stand for re-election at the company's next annual meeting,
along with Shakeel.

     In a separate news release today, the company announced its financial
results for the first fiscal quarter ended September 29, 2006, including revenue
of $1.3 billion and net income of $.46 per share on unit shipments of
approximately 22.7 million hard drives.

     The current senior management team began working together at WD more than
20 years ago and for the last seven years has been instrumental in developing
the company into one of the most consistently profitable, efficient and low-cost
producers in the global hard drive industry. WD



John Coyne to Become Western Digital CEO; Arif Shakeel to Remain in
Advisory Capacity and on Board of Directors
Page 2

has relentlessly focused on quality and reliability in its products, efficiency
in its manufacturing operations and asset management, and excellence in its
customer and supply chain relationships. Today, the company is the world's
second largest manufacturer of hard drives. Under this management team, WD has
more than doubled its revenue from $2.0 billion in fiscal 2000 to $4.3 billion
in fiscal 2006, grown its profitability from a loss of $188 million to income of
$396 million, expanded its cash and short-term investments from $184 million to
$699 million, and posted one of the industry's leading returns on invested
capital.

     Coyne is a veteran of the international electronics business and has
dedicated the majority of his career to WD. In the last several years, his
responsibilities gradually have expanded beyond worldwide manufacturing
operations to include all business operations, materials, sales, and customer
satisfaction. He was named president and chief operating officer earlier this
year; he served as executive vice president and chief operations officer
beginning in 2005, and as senior vice president, worldwide operations from 2000
to 2005. Beginning in 2003, Coyne led the integration of the acquired assets of
Read-Rite Corp. into a highly efficient head operation at WD. He first joined WD
in 1983, when he established a controller board manufacturing facility in his
native Ireland. Coyne holds a bachelor's degree in mechanical engineering from
University College Dublin, Ireland.

ABOUT WD

     WD, one of the storage industry's pioneers and long-time leaders, provides
products and services for people and organizations that collect, manage and use
digital information. The company produces reliable, high-performance hard drives
that keep users' data close-at-hand and



John Coyne to Become Western Digital CEO; Arif Shakeel to Remain in
Advisory Capacity and on Board of Directors
Page 3

secure from loss. WD applies its storage expertise to consumer products for
external, portable and shared storage products.

     WD was founded in 1970. The company's storage products are marketed to
leading systems manufacturers, selected resellers and retailers under the
Western Digital and WD brand names. Visit the Investor section of the company's
Web site (www.westerndigital.com) to access a variety of financial and investor
information.

                                             ###

Western Digital, WD, and the WD logo are registered trademarks of Western
Digital Technologies, Inc. All other trademarks herein are property of their
respective owner.