SanDisk 2010 Annual Report Download - page 113

Proxy Statement
I. Change in Control. Each outstanding purchase right shall automatically be exercised, immediately prior
to the effective date of any Change in Control, by applying the payroll deductions of each Participant for the
Purchase Interval in which such Change in Control occurs to the purchase of whole shares of Common Stock at a
purchase price per share not less than eighty five percent (85%), of the lower of (i) the Fair Market Value per
share of Common Stock on the Participant’s Entry Date into the offering period in which the Participant is
enrolled at the time such Change in Control occurs or (ii) the Fair Market Value per share of Common Stock
immediately prior to the effective date of such Change in Control. The actual percentage purchase price shall be
equal to the percentage purchase price in effect under Article VII.(C) for the offering period in which the
Participant is enrolled at the time of such Change in Control. However, the applicable limitation on the number
of shares of Common Stock purchasable per Participant shall continue to apply to any such purchase.
The Corporation shall use its best efforts to provide at least ten (10) days prior written notice of the
occurrence of any Change in Control, and Participants shall, following the receipt of such notice, have the right
to terminate their outstanding purchase rights prior to the effective date of the Change in Control.
J. Proration of Purchase Rights. Should the total number of shares of Common Stock to be purchased
pursuant to outstanding purchase rights on any particular date exceed the number of shares then available for
issuance in the aggregate under the Plan and the International Plan, the Plan Administrator shall make a pro-rata
allocation of the available shares on a uniform and nondiscriminatory basis among the Participants in the Plan
and those participating in the International Plan, and the payroll deductions of each affected individual, to the
extent in excess of the aggregate purchase price payable for the Common Stock pro-rated to that individual, shall
be refunded.
K. ESPP Broker Account. The shares purchased on behalf of each Participant shall be deposited directly
into a brokerage account which the Corporation shall establish for the Participant at a Corporation-designated
brokerage firm. The account will be known as the ESPP Broker Account. Except as otherwise provided below,
the deposited shares may not be transferred (either electronically or in certificate form) from the ESPP Broker
Account until the end of the two (2)-year period measured from the Participant’s Entry Date into the offering
period in which the shares were purchased.
Such limitation shall apply both to transfers to different accounts with the same ESPP broker and to
transfers to other brokerage firms. Any shares held for the required holding period may be transferred (either
electronically or in certificate form) to other accounts or to other brokerage firms.
The foregoing procedures shall not in any way limit when the Participant may sell his or her shares.
Those procedures are designed solely to assure that any sale of shares prior to the satisfaction of the required
holding period is made through the ESPP Broker Account. In addition, the Participant may request a stock
certificate or share transfer from his or her ESPP Broker Account prior to the satisfaction of the required holding
period should the Participant wish to make a gift of any shares held in that account. However, shares may not be
transferred (either electronically or in certificate form) from the ESPP Broker Account for use as collateral for a
loan, unless those shares have been held for the required holding period.
The foregoing procedures shall apply to all shares purchased by the Participant under the Plan, whether or
not the Participant continues in Employee status.
L. Assignability. The purchase right shall be exercisable only by the Participant and shall not be assignable
or transferable by the Participant.
M. Stockholder Rights. A Participant shall have no stockholder rights with respect to the shares subject to
his or her outstanding purchase right until the shares are purchased on the Participant’s behalf in accordance with
the provisions of the Plan and the Participant has become a holder of record of the purchased shares.
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