SanDisk 2012 Annual Report Download - page 60

• Dr. Quader—The Compensation Committee considered Dr. Quader’s contributions to and leadership in
helping the Company outperform its strategic objectives in the areas of research and development relating to
memory technologies and improvements in the Company’s product development process, and the contributions
of the developments in memory technologies to near-, medium- and long-term stockholder value.
Upon consideration of each of the foregoing company-wide and individual factors, the Compensation
Committee determined that the actual cash incentive awards for fiscal year 2012 for each Named Executive
Officer should be as follows: $661,500 for Mr. Mehrotra (49% of his target bonus); $276,800 for Ms. Bruner
(49% of her target bonus); $211,000 for Mr. Sadana (49% of his target bonus); and $125,800 for Dr. Quader
(50% of his target bonus). Since Mr. Brelsford resigned from his position with the Company, effective as of
December 14, 2012, Mr. Brelsford was not eligible for a cash incentive award for fiscal year 2012. These annual
cash incentive awards earned by the Named Executive Officers for fiscal year 2012 are also set forth in the “Non-
Equity Incentive Plan Compensation” column in the Summary Compensation Table.
Clawback Policy on Cash-Based Incentive Awards
The Section 16 Officers, including the Named Executive Officers, are subject to the Company’s clawback
policy. The Company’s clawback policy provides that the Board may require reimbursement or forfeiture of all
or a portion of any cash-based incentive compensation paid to such individual to the extent that (i) the
Company’s financial statements are required to be restated as a result of material non-compliance with any
financial reporting requirements under the federal securities laws (other than a restatement due to a change in
financial accounting rules), (ii) as a result of such restatement, a performance measure or specified performance
target which was a material factor in determining the amount of cash-based incentive compensation previously
earned by the individual is restated, and (iii) upon a determination by the Board, a lesser payment of cash-based
incentive compensation would have been made to the individual based upon the restated financial results.
Long-Term Share-Based Incentive Awards
The Company’s policy is that the long-term compensation of the executive officers, including the Named
Executive Officers, should be directly linked to the value provided to the Company’s stockholders. Therefore,
100% of the Named Executive Officers’ long-term compensation is currently awarded in the form of share-based
instruments that are in, or valued by reference, to Common Stock. The Company’s share-based awards have been
made in the form of stock options and RSUs, although the majority of these awards have historically been stock
options. The number of shares of Common Stock subject to each annual award is intended to create a meaningful
opportunity for stock ownership in light of the Named Executive Officer’s current position with the Company,
the economic value of comparable awards to comparable executive officers at the Company’s peer companies,
the individual’s potential for increased responsibility and promotion over the award term, and the individual’s
performance in recent periods. The Compensation Committee also takes into consideration the number of
unvested share-based incentive awards held by each Named Executive Officer, in order to maintain an
appropriate level of equity incentive for that individual. However, the Compensation Committee does not adhere
to any specific guidelines as to the relative equity award holdings of the Company’s executive officers, including
the Named Executive Officers. Furthermore, similar to the setting of base salaries, the weighting of the above
factors is subjective, and the Compensation Committee does not use a formula to determine the number or value
of share-based incentive awards granted to any executive officer, including the Named Executive Officers.
The Compensation Committee typically grants long-term share-based incentive awards in the first quarter of
the fiscal year, except for awards to new hires and awards related to the promotion and retention of current
employees. However, there is no formal program, plan or policy in place at the Company or in the Compensation
Committee’s charter with respect to the timing of long-term share-based incentive award grants, except as set
forth below with respect to grants to new employees and related to promotions and retention. The Compensation
Committee has complete discretion as to when it awards long-term share-based incentive awards. There is also
no program, plan or policy related to the timing of grants to the executive officers in coordination with the
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