SanDisk 2010 Annual Report Download - page 93

Proxy Statement
order covering the Stand-alone Right as marital property. In addition, one or more beneficiaries may be
designated for an outstanding Stand-alone Right in accordance with substantially the same terms and
provisions as set forth in Section I.F of this Article Two.
4. The distribution with respect to an exercised Stand-alone Right shall be made in shares of Common
Stock valued at Fair Market Value on the exercise date.
5. The holder of a Stand-alone Right shall have no stockholder rights with respect to the shares subject
to the Stand-alone Right unless and until such person shall have exercised the Stand-alone Right and
become a holder of record of the shares of Common Stock issued upon the exercise of such Stand-alone
Right.
E. Post-Service Exercise. The provisions governing the exercise of Tandem and Stand-alone Rights
following the cessation of the recipient’s Service shall be substantially the same as those set forth in Section I.C
of this Article Two for the options granted under the Discretionary Grant Program, and the Plan Administrator’s
discretionary authority under Section I.C.2 of this Article Two shall also extend to any outstanding Tandem or
Stand-alone Appreciation Rights.
F. Gross Counting. Upon the exercise of any Tandem or Stand-alone Right under this Section III, the share
reserve under Section V of Article One shall be reduced by the gross number of shares as to which such right is
exercised, and not by the net number of shares actually issued by the Corporation upon such exercise.
IV. CHANGE IN CONTROL/HOSTILE TAKE-OVER
A. In the event of a Change in Control, each outstanding option or stock appreciation right under the
Discretionary Grant Program shall automatically accelerate so that each such option or stock appreciation right
shall, immediately prior to the effective date of that Change in Control, become exercisable as to all the shares of
Common Stock at the time subject to such option or stock appreciation right and may be exercised as to any or
all of those shares as fully vested shares of Common Stock. However, an outstanding option or stock appreciation
right shall not become exercisable on such an accelerated basis if and to the extent: (i) such option or stock
appreciation right is to be assumed by the successor corporation (or parent thereof) or is otherwise to continue in
full force and effect pursuant to the terms of the Change in Control transaction or (ii) such option or stock
appreciation right is to be replaced with a cash incentive program of the successor corporation which preserves
the spread existing at the time of the Change in Control on any shares as to which the option or stock
appreciation right is not otherwise at that time exercisable and provides for subsequent payout of that spread in
accordance with the same exercise/vesting schedule applicable to those shares or (iii) the acceleration of such
option or stock appreciation right is subject to other limitations imposed by the Plan Administrator.
B. All outstanding repurchase rights under the Discretionary Grant Program shall automatically terminate,
and the shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of
a Change in Control, except to the extent: (i) those repurchase rights are to be assigned to the successor
corporation (or parent thereof) or are otherwise to continue in full force and effect pursuant to the terms of the
Change in Control transaction or (ii) such accelerated vesting is precluded by other limitations imposed by the
Plan Administrator.
C. Immediately following the consummation of the Change in Control, all outstanding options or stock
appreciation rights under the Discretionary Grant Program shall terminate and cease to be outstanding, except to
the extent assumed by the successor corporation (or parent thereof) or otherwise continued in full force and effect
pursuant to the terms of the Change in Control transaction.
D. Each option which is assumed in connection with a Change in Control or otherwise continued in effect
shall be appropriately adjusted, immediately after such Change in Control, to apply to the number and class of
securities which would have been issuable to the Optionee in consummation of such Change in Control had the
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