Western Digital Said to Resolve Two Non-Compliance Matters With China’s Ministry of Commerce (MOFCOM)

Western Digital Corp. has successfully resolved two non-compliance matters with China’s Ministry of Commerce (MOFCOM) as part of its ongoing and constructive dialogue with the agency regarding the hold separate restriction associated with WDC’s acquisition of HGST in March 2012.

The company said that these steps represent significant progress in its relationship with MOFCOM and that, while it cannot predict whether or when the agency will lift the hold separate condition, MOFCOM has indicated to the company that it is now fully focused on considering Western Digital’s application to lift the restriction.

MOFCOM continues to express overall satisfaction with the company’s efforts to comply with its hold separate remedy.

WDC continues to believe a lift of the condition best serves the interests of the company, the industry, the Chinese economy and consumers worldwide.

The company is fully complying with resolutions associated with these matters,
which relate to:

• the organization of a WDC department that included several former HGST employees, and
• the re-alignment of the ownership structure of an indirect subsidiary of WDC. To implement these resolutions, the company will pay a penalty of 600,000RMB (approximately $100,000 in total), conduct an immaterial reorganization of the department in question, and make certain modifications to its subsidiary structure that will be neutral and non-material from a tax and financial standpoint.