SanDisk 2005 Annual Report Download - page 41

market price of the Common Stock appreciates over the option term, no value will be realized from the
option grants made to the executive officers.
(6) Does not include options for 1,950 shares granted to Mr. Chan's spouse, an employee of the Company.
Mr. Chan disclaims beneficial ownership of the options held by his spouse.
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option Values
The following table sets forth information concerning option exercises and option holdings for the 2005
fiscal year by each of the Named Executive Officers. No stock appreciation rights were exercised during such
year or were outstanding at the end of that year.
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options at
Number of Shares Options at FY-End (#) FY-End ($)(2)
Acquired on Aggregate Value
Name Exercise (#) Realized ($)(1) Exercisable Unexercisable Exercisable Unexercisable
Dr. Eli HarariÏÏÏÏÏÏ 417,014 15,656,125 2,453,702 1,000,000 123,627,235 38,964,750
Sanjay Mehrotra ÏÏÏ 415,000 12,506,277 622,621 602,189 35,760,329 22,930,069
Judy Bruner ÏÏÏÏÏÏÏ 171,000 3,916,400 125,750 406,250 5,814,485 16,839,375
Nelson Chan(3)ÏÏÏÏ 441,928 15,714,752 389,373 390,627 18,364,668 14,767,332
Yoram Cedar ÏÏÏÏÏÏ 198,000 7,004,218 182,249 389,751 8,356,524 13,289,990
(1) Equal to the fair market value of the shares at the time of acquisition over the option exercise price paid
for those shares.
(2) Based on the fair market value of the Company's Common Stock at December 30, 2005, the last trading
day of the Company's fiscal year which ended January 1, 2006, $62.82 per share (the closing selling price
of the Company's Common Stock on that date on the Nasdaq National Market), less the exercise price
payable for such shares.
(3) Excludes option exercises and outstanding options held by Mr. Chan's spouse, an employee of the
Company. During fiscal 2005, Mr. Chan's spouse acquired 3,425 shares of the Company's Common
Stock on exercise of stock options with an aggregate value realized of $101,204. As of the end of fiscal
2005, Mr. Chan's spouse has no exercisable options and 4,275 shares underlying unexercisable options
with an aggregate value of $160,043. Mr. Chan disclaims beneficial ownership with respect to these
securities.
AUDIT COMMITTEE REPORT
The information contained in this report shall not be deemed to be ""soliciting material'' or to be ""filed''
with the Securities and Exchange Commission, nor shall such information be incorporated by reference into
any future filings with the Securities and Exchange Commission, or subject to the liabilities of Section 18 of
the Securities Exchange Act of 1934, as amended, except to the extent that the Company specifically
incorporates it by reference into a document filed under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended.
The following is the report of the Audit Committee with respect to the Company's audited financial
statements for the fiscal year ended January 1, 2006 included in the Company's Annual Report on Form 10-K
for that year.
The Audit Committee has reviewed and discussed the audited financial statements with management of
the Company.
The Audit Committee has discussed with the Company's independent registered accounting firm,
Ernst & Young LLP, the matters required to be discussed by SAS 61 (Codification of Statements on
Auditing Standards, AU Section 380), as amended, which include, among other items, matters related to the
conduct of the audit of the Company's financial statements.
32