SanDisk 2010 Annual Report Download - page 97

Proxy Statement
requirements applicable to the Participant’s unvested shares of Common Stock and (ii) such escrow
arrangements as the Plan Administrator shall deem appropriate.
4. The Participant shall have full stockholder rights with respect to any shares of Common Stock issued
to the Participant under the Stock Issuance and Cash Bonus Program, whether or not the Participant’s
interest in those shares is vested. Accordingly, the Participant shall have the right to vote such shares and to
receive any dividends paid on such shares, subject to any applicable vesting requirements. The Participant
shall not have any stockholder rights with respect to the shares of Common Stock subject to a restricted
stock unit or share right award until that award vests and the shares of Common Stock are actually issued
thereunder. However, dividend-equivalent units may be paid or credited, either in cash or in actual or
phantom shares of Common Stock, on outstanding restricted stock unit or share right awards, subject to such
terms and conditions as the Plan Administrator may deem appropriate.
5. Should the Participant cease to remain in Service while holding one or more unvested shares of
Common Stock issued under the Stock Issuance and Cash Bonus Program or should the performance
objectives not be attained with respect to one or more such unvested shares of Common Stock, then those
shares shall be immediately surrendered to the Corporation for cancellation, and the Participant shall have
no further stockholder rights with respect to those shares. To the extent the surrendered shares were
previously issued to the Participant for consideration paid in cash or cash equivalent, the Corporation shall
repay to the Participant the lower of (i) the cash consideration paid for the surrendered shares or (ii) the Fair
Market Value of those shares at the time of cancellation.
6. The Plan Administrator may in its discretion waive the surrender and cancellation of one or more
unvested shares of Common Stock which would otherwise occur upon the cessation of the Participant’s
Service or the non-attainment of the performance objectives applicable to those shares. Any such waiver
shall result in the immediate vesting of the Participant’s interest in the shares of Common Stock as to which
the waiver applies. Such waiver may be effected at any time, whether before or after the Participant’s
cessation of Service or the attainment or non-attainment of the applicable performance objectives. However,
no vesting requirements tied to the attainment of performance objectives may be waived with respect to
shares which were intended at the time of issuance to qualify as performance-based compensation under
Code Section 162(m), except in the event of the Participant’s Involuntary Termination or as otherwise
provided in Section II of this Article Three.
7. Outstanding share right awards, restricted stock units or cash bonus awards under the Stock Issuance
and Cash Bonus Program shall automatically terminate, and no shares of Common Stock or cash shall
actually be issued or paid in satisfaction of those awards or units, if the performance goals or Service
requirements established for such awards or units are not attained or satisfied. The Plan Administrator,
however, shall have the discretionary authority to (i) issue vested shares of Common Stock under one or
more outstanding share right awards or restricted stock units as to which the designated performance goals
or Service requirements have not been attained or satisfied, and (ii) award cash bonus payments that are not
intended to qualify as performance-based compensation under Section 162(m) of the Code.
However, no vesting or payment requirements tied to the attainment of performance goals may be
waived with respect to awards or units which were intended, at the time those awards or units were granted,
to qualify as performance-based compensation under Code Section 162(m), except in the event of the
Participant’s Involuntary Termination or as otherwise provided in Section II of this Article Three.
8. Before any performance-based award under the Stock Issuance and Cash Bonus Program is paid and
to the extent required to qualify the award as performance-based compensation within the meaning of
Section 162(m) of the Code, the Plan Administrator must certify in writing that the performance target(s)
and any other material terms of the performance-based award were in fact timely satisfied.
9. The Plan Administrator will have the discretion to determine the restrictions or other limitations of the
individual awards granted under the Stock Issuance and Cash Bonus Program including the authority to reduce
awards, payouts or vesting or to pay no awards, in its sole discretion, if the Plan Administrator preserves such
authority at the time of grant by language to this effect in its authorizing resolutions or otherwise.
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