SanDisk 2012 Annual Report Download - page 103

Proxy Statement
the beginning of such period or (B) have been elected or nominated for election as Board members during
such period by at least a majority of the Board members described in clause (A) who were still in office at
the time the Board approved such election or nomination, or
(ii) the acquisition, directly or indirectly, by any person or related group of persons (other than the
Corporation or a person that directly or indirectly controls, is controlled by, or is under common control
with, the Corporation) of beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of
securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s
outstanding securities pursuant to a tender or exchange offer made directly to the Corporation’s stockholders
which the Board does not recommend such stockholders to accept.
Notwithstanding the foregoing, if a Hostile Take-Over constitutes a payment event with respect to any
award which provides for the deferral of compensation that is subject to Section 409A of the Code, to the
extent required to avoid the imposition of additional taxes under Section 409A of the Code, the transaction
or event described in subsection (i) or (ii) with respect to such award shall only constitute a Hostile Take-
Over for purposes of the payment timing of such award if such transaction also constitutes a “change in
control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5). Consistent with the terms of this
Plan, the Plan Administrator shall have full and final authority to determine conclusively whether a Hostile
Take-Over of the Corporation has occurred pursuant to the above definition, the date of the occurrence of
such Hostile Take-Over and any incidental matters relating thereto.
N. Incentive Option shall mean an option which satisfies the requirements of Code Section 422.
O. Involuntary Termination shall mean the termination of the Service of any individual which occurs by
reason of:
(i) such individual’s involuntary dismissal or discharge by the Corporation (or any Parent or
Subsidiary) for reasons other than Misconduct, or
(ii) such individual’s voluntary resignation following (A) a change in his or her position with the
Corporation (or any Parent or Subsidiary) which materially reduces his or her duties and responsibilities or
the level of management to which he or she reports, (B) a reduction in his or her level of compensation
(including base salary, fringe benefits and target bonus under any corporate-performance based bonus or
incentive programs) by more than fifteen percent (15%) or (C) a relocation of such individual’s place of
employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is
effected by the Corporation (or any Parent or Subsidiary) without the individual’s consent.
P. Misconduct shall mean the commission of any act of fraud, embezzlement or dishonesty by the Optionee
or Participant, any unauthorized use or disclosure by such person of confidential information or trade secrets of
the Corporation (or any Parent or Subsidiary), or any other intentional misconduct by such person adversely
affecting the business or affairs of the Corporation (or any Parent or Subsidiary) in a material manner. The
foregoing definition shall not in any way preclude or restrict the right of the Corporation (or any Parent or
Subsidiary) to discharge or dismiss any Optionee, Participant or other person in the Service of the Corporation
(or any Parent or Subsidiary) for any other acts or omissions, but such other acts or omissions shall not be
deemed, for purposes of the Plan, to constitute grounds for termination for Misconduct.
Q. 1934 Act shall mean the Securities Exchange Act of 1934, as amended.
R. Non-Employee Director Compensation Policy shall mean the written policy adopted by the
Corporation regarding the compensation of non-employee members of the Board, as may be amended from time
to time.
S. Non-Statutory Option shall mean an option not intended to satisfy the requirements of Code
Section 422.
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