SanDisk 2011 Annual Report Download

Download and view the complete annual report

Please find the complete 2011 SanDisk annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 192

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184
  • 185
  • 186
  • 187
  • 188
  • 189
  • 190
  • 191
  • 192

Stockholders Letter
Notice of 2012 Annual
Meeting and Proxy
Statement
2011 Annual Report
on Form 10-K
ANNUAL
REPORT
2011

Table of contents

  • Page 1
    ANNUAL REPORT 2011 Stockholders Letter Notice of 2012 Annual Meeting and Proxy Statement 2011 Annual Report on Form 10-K

  • Page 2
    ... solutions, from research and development, product design and manufacturing to branding and distribution for OEM and retail channels. Since 1988, SanDisk's innovations in ï¬,ash memory and storage system technologies have provided customers with new and transformational digital experiences. SanDisk...

  • Page 3
    Stockholders Letter Proxy Statement Annual Report

  • Page 4

  • Page 5
    ...in May 2011, making SanDisk the leading supplier of serial-attached SCSI (SAS) SSDs. This acquisition is highly complementary since Pliant's proprietary controller technology and SanDisk's high quality captive MLC NAND supply provide industry leading products with dependable access to supply for our...

  • Page 6
    ... embedded solutions, are designed to address the vast majority of the embedded flash opportunities in the smartphone market. The tablet market emerged in mid-2010 and it is changing the way people work, play and interact with one another. As more powerful processors and supporting chipsets...

  • Page 7
    ...of these trends by providing leading storage solutions. I trust you share our excitement and passion for driving our business to new levels. I would like to thank you again for your continuing support and confidence in SanDisk. Sincerely yours, Sanjay Mehrotra President and Chief Executive Officer

  • Page 8

  • Page 9
    ...the Company's independent registered public accounting firm for the fiscal year ending December 30, 2012. Advisory resolution to approve executive compensation. To transact such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof. Proxy Statement...

  • Page 10
    [THIS PAGE INTENTIONALLY LEFT BLANK]

  • Page 11
    ...EXECUTIVE COMPENSATION OF SANDISK CORPORATION ...SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT ...COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934 ...ANNUAL REPORT ON FORM 10-K ...AUDIT COMMITTEE REPORT ...COMPENSATION DISCUSSION AND ANALYSIS ...Executive Summary...

  • Page 12
    [THIS PAGE INTENTIONALLY LEFT BLANK]

  • Page 13
    ...with the 12-Digit Control Number found on the Notice or proxy card in the subject line to [email protected]. Voting Rights On the Record Date, approximately 243,661,342 shares of the Company's common stock (the "Common Stock") were outstanding and entitled to vote at the Annual Meeting. The...

  • Page 14
    ... the persons named as proxies will vote on any other matters properly presented at the Annual Meeting in accordance with their best judgment. Stockholder votes will be tabulated by a representative of Broadridge Financial Solutions, Inc. Each share of Common Stock outstanding on the Record Date is...

  • Page 15
    ... at 601 McCarthy Boulevard, Milpitas, California 95035 or call the Company's Investor Relations department at (408) 801-1000, and the Company will promptly comply with such request. Stockholders may contact the Company's Investor Relations representative at the phone number above if it receives...

  • Page 16
    ... from 1989 to 2002 and returned to the Board in May 2004. Business Experience and Qualifications of Nominees for Election as Directors Mr. DeNuccio has served as a Director of the Company since August 4, 2009. Mr. DeNuccio has been the Chief Executive Officer of Metaswitch Networks, a provider of...

  • Page 17
    ... as the chief executive officer and chief financial officer of a large, complex, publicly-held technology company, as well as his venture capital experience, which is important to the Board's understanding of business development, financing, strategic alternatives and industry trends. The Board also...

  • Page 18
    ... venture capital experience aids the Board's understanding of business development, financing, strategic alternatives and industry trends. Mr. Marks has served as a Director of the Company since August 2003 and as Chairman of the Board since January 2011. Mr. Marks has managed Riverwood Capital, LLC...

  • Page 19
    ... Chief Operating Officer, Executive Vice President and Chief Operating Officer, Senior Vice President of Product Development, Vice President of Product Development, and Director of Design Engineering. Mr. Mehrotra has more than 30 years of experience in the non-volatile semiconductor memory industry...

  • Page 20
    ... requirements and the performance of the Company's internal accounting, audit and financial controls. The Audit Committee also conducts quarterly reviews with management on the Company's enterprise risk assessment and mitigation processes and assists the Board with its oversight and annual review of...

  • Page 21
    ... Committee charter. The Company's Executive Vice President, Administration and Chief Financial Officer recommends to the Company's Chief Executive Officer the form and amount of compensation provided to the Company's Chief Legal Officer and Senior Vice President of IP Licensing. Except for the...

  • Page 22
    ... and Chief Financial Officer, and James F. Brelsford, the Company's Chief Legal Officer and Senior Vice President of IP Licensing, who was appointed to the Secondary Executive Committee in March 2011. Share-based awards to the Section 16 officers are made exclusively by the Compensation Committee...

  • Page 23
    ... objectives for fiscal 2011. Use of Long-Term Incentive Compensation. Share-based long-term incentive compensation that vests over a period of years is a key component of the total compensation of many of the Company's employees. This vesting period encourages the Company's executives and other...

  • Page 24
    ... and Risk Oversight Board Leadership Structure Mr. Marks has served as the Chairman of the Board since January 1, 2011. Mr. Mehrotra has served as Chief Executive Officer of the Company since January 1, 2011 and as a Director since July 2010. The Board believes that it is in the Company's best...

  • Page 25
    ... judgment in matters that relate to the current and long-term objectives of the Company; Ability to read and understand basic financial statements and other financial information pertaining to the Company; Commitment to understand the Company and its business, industry and strategic objectives...

  • Page 26
    ...the Company rather than the interests of a particular group; Good health and ability to serve; For prospective non-employee Directors, independence under applicable SEC and stock exchange rules, and the absence of any conflict of interest (whether due to a business or personal relationship) or legal...

  • Page 27
    ... the Company's Form 10-K for the fiscal year ended January 1, 2012 filed with the SEC on February 23, 2012. Under general accounting principles, compensation expense with respect to stock awards and option awards granted to the Directors is generally recognized over the vesting periods applicable to...

  • Page 28
    ... grant practices, the fair market value is equal to the closing price of a share of the Common Stock on NASDAQ on the grant date. The stock options granted to Non-Employee Directors are immediately exercisable. However, upon a Non-Employee Director's cessation of service with the Company, any shares...

  • Page 29
    ... preceding the next annual meeting of the Company's stockholders following the grant date. Pursuant to the terms of the 2005 Plan, restricted stock units granted to the Company's Non-Employee Directors will vest on an accelerated basis in connection with a change in control of the Company. Upon the...

  • Page 30
    ...'s quarterly financial statements. The fees also included professional services provided for new and existing statutory audits of subsidiaries or affiliates of the Company. Audit-related fees consisted primarily of accounting consultations, services provided in connection with regulatory filings...

  • Page 31
    ...person or represented by proxy at the Annual Meeting and entitled to vote on Proposal No. 2 is required to ratify the appointment of Ernst & Young LLP as the Company's independent registered public accounting firm for the fiscal year ending December 30, 2012. Recommendation of the Board of Directors...

  • Page 32
    ... important performance measures aligned with long-term stockholder value. During fiscal 2011, a significant percentage of each executive officer's total compensation (as reported in the summary compensation table) was at-risk, being comprised of performance-based cash bonus opportunities, restricted...

  • Page 33
    ... significant vote against the "say-on-pay" proposal, the Compensation Committee will consider the Company's stockholders' concerns and will evaluate whether any actions are necessary to address those concerns. Recommendation of the Board of Directors The Board believes that approval of Proposal No...

  • Page 34
    ... as Executive Vice President and Chief Technology Officer, effective December 31, 2011, and his vested stock options, including those that vested pursuant to the terms of his separation agreement, will terminate on April 30, 2012 to the extent not exercised prior to such date. Includes 25,000 shares...

  • Page 35
    ... Company that lapses over time. Excludes 1,809 restricted stock units that will not vest on February 24, 2012 or within 60 days of that date. Includes 24,934 shares held in the name of a trust for the benefit of Mr. Mehrotra and his spouse. Also includes 865,375 shares subject to outstanding options...

  • Page 36
    The following table sets forth certain information about entities of which the Company is aware, based solely on filings made with the SEC, to be beneficial owners of 5% or more of the Common Stock as of February 24, 2012: Beneficial Ownership Number of Shares Percentage Owned Name or Group of ...

  • Page 37
    ...16(A) OF THE SECURITIES EXCHANGE ACT OF 1934 Section 16(a) of the Exchange Act, requires the Company's Directors, executive officers and persons who own more than 10% of a registered class of the Company's equity securities, to file initial reports of ownership and reports of changes in ownership of...

  • Page 38
    ... The Company filed its Annual Report on Form 10-K with the SEC on February 23, 2012. Stockholders may obtain a copy of the Annual Report on Form 10-K, without charge, by writing to Investor Relations at the Company's principal executive offices located at 601 McCarthy Boulevard, Milpitas, California...

  • Page 39
    ... amended (the "Securities Act"), or the Exchange Act. The following is the report of the Audit Committee with respect to the Company's audited financial statements for the fiscal year ended January 1, 2012 included in the Company's Annual Report on Form 10-K, which was filed with the SEC on February...

  • Page 40
    ... ended fiscal 2011 with cash and cash equivalents and short and long-term marketable securities above $5.62 billion, up from $5.34 billion at the end of fiscal 2010. The Company uses non-GAAP measures to establish operational goals and to measure performance for executive officer compensation...

  • Page 41
    ... to the executive officer only upon realized share appreciation. The Compensation Committee established key performance metrics for the fiscal 2011 annual cash incentive opportunity, which provided for payments based upon achievement relative to a non-GAAP earnings per share ("EPS") target and the...

  • Page 42
    ...material elements of the Company's current executive compensation program for the executive officers include the following: a base salary, an annual cash incentive opportunity, a long-term share-based incentive opportunity, 401(k) retirement benefits and severance protection for certain terminations...

  • Page 43
    ... an annual basis to the executive officers, including the Named Executive Officers, and is designed to reward performance for that period. The long-term equity incentives are generally designed to reward performance over one or more years. The Compensation Committee evaluates executive compensation...

  • Page 44
    ... executive officers at the Company's peer companies (based on their published prior fiscal year's data). The Compensation Committee has typically considered such summary, as well as internal comparables, individual performance and the Company's financial performance, in reviewing the executive...

  • Page 45
    ... benefits agreement entered into with the Company's Chief Executive Officer. In recent years, the Company has granted cash incentive awards to the Named Executive Officers that were determined based on the achievement of specified performance goals. In February 2011, the Compensation Committee...

  • Page 46
    ... should receive $436,500 (100% of his target bonus) under the 2011 bonus program. These annual cash incentive awards earned by our Named Executive Officers for fiscal 2011 are also set forth in the "Non-Equity Incentive Plan Compensation" column in the Summary Compensation Table. Clawback Policy...

  • Page 47
    ... their shares. The stock options also function as a retention incentive for the Company's executive officers as they vest over a four (4) year period following the grant date. In fiscal 2011, the Compensation Committee granted stock options to each of the Named Executive Officers. The material terms...

  • Page 48
    ... and/or eliminate his or her annual bonus opportunity to force the Named Executive Officer to terminate his or her own employment and thereby avoid paying severance. Since the Company believes that constructive terminations in connection with a change in control are conceptually the same as actual...

  • Page 49
    ... in connection with the Company's fiscal 2012 annual cash incentive program for the Named Executive Officers who are currently employees of the Company which are intended to comply with Section 162(m) of the Code. The performance targets under the fiscal 2012 annual cash incentive program relate to...

  • Page 50
    ... the sole governing factor. Accordingly, the Compensation Committee may provide one or more executive officers with the opportunity to earn incentive compensation, whether through cash bonus programs tied to the Company's financial performance or share-based awards in the form of restricted stock or...

  • Page 51
    ... Section 18 of the Securities Exchange Act of 1934, except to the extent that the Company specifically incorporates it by reference into a document filed under the Securities Act, or the Exchange Act. The Compensation Committee has reviewed and discussed with management the disclosures contained in...

  • Page 52
    ...-K for the fiscal year ended January 1, 2012 filed with the SEC on February 23, 2012. Under general accounting principles, compensation expense with respect to stock awards and option awards granted to the Company's employees is generally recognized over the vesting periods applicable to the awards...

  • Page 53
    ... of the material terms of the restricted stock units and stock options granted in fiscal 2011 that follows the table, provides information regarding the long-term equity incentives awarded to the Named Executive Officers in fiscal 2011. The Outstanding Equity Awards at Fiscal 2011 Year-End table and...

  • Page 54
    ...-K for the fiscal year ended January 1, 2012 filed with the SEC on February 23, 2012. Under general accounting principles, compensation expense with respect to stock awards and option awards granted to the Company's employees is generally recognized over the vesting periods applicable to the awards...

  • Page 55
    ... persons or entities, provided that such transfers comply with applicable securities laws and, with limited exceptions set forth in the plan document, are not made for value. Under the terms of the 2005 Plan, if there is a change in control of the Company, each Named Executive Officer's outstanding...

  • Page 56
    ... normal expiration date. Each of the stock options granted to the Named Executive Officers in fiscal 2011 has a term of seven (7) years. Outstanding options, however, may terminate earlier in connection with a change in control transaction or a termination of the Named Executive Officer's employment...

  • Page 57
    ...at Fiscal 2011 Year-End The following table presents information regarding the outstanding share-based awards held by each Named Executive Officer as of January 1, 2012, including the vesting dates for the portions of these awards that had not vested as of that date. Additional information regarding...

  • Page 58
    ... of the Named Executive Officer's employment. The market value of stock awards reported is computed by multiplying the number of shares or units of stock reported by $49.21, the closing market price of the Common Stock on December 30, 2011, the last trading day in fiscal 2011. The unvested...

  • Page 59
    ... Named Executive Officers may also be subject to accelerated vesting in connection with certain changes in control of the Company under the terms of the Company's equity incentive plans as noted under "Grants of Plan-Based Awards in Fiscal 2011" and "Outstanding Equity Awards at Fiscal 2011 Year-End...

  • Page 60
    ... in accordance with the terms of the applicable award agreement by assuming the performance objective is met. Severance Benefits-Termination of Employment in Connection with Change in Control. In the event a Named Executive Officer's employment is terminated by the Company (or a successor) without...

  • Page 61
    ..., 2011, the Company entered into a separation agreement with Mr. Cedar in connection with Mr. Cedar's resignation from his position as Executive Vice President and Chief Technology Officer, effective December 31, 2011 (the "Separation Date"). Pursuant to the separation agreement, the Company agreed...

  • Page 62
    ... company's total annual revenue; compensation to executive officers determined by the Compensation Committee; compensation to Directors determined by the Board; transactions in which all security holders receive proportional benefits; and banking-related services involving a bank depository of funds...

  • Page 63
    ... before the Annual Meeting; however, it is the intention of the persons named in the accompanying proxy to vote the shares represented thereby on such matters in accordance with their best judgment. By Order of the Board of Directors, Michael E. Marks Chairman of the Board of Directors April 30...

  • Page 64
    [THIS PAGE INTENTIONALLY LEFT BLANK]

  • Page 65
    ...(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended January 1, 2012 OR ' TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 0000-26734 SANDISK CORPORATION (Exact name of registrant as...

  • Page 66
    ... Market Risk ...Financial Statements and Supplementary Data ...Changes in and Disagreements with Accountants on Accounting and Financial Disclosure ...Controls and Procedures ...Other Information ...PART III Directors, Executive Officers and Corporate Governance ...Executive Compensation ...Security...

  • Page 67
    ... a Fortune 500 company. What We Do. We design, develop and manufacture data storage solutions in a variety of form factors using our flash memory, proprietary controller and firmware technologies. Our solutions include removable cards, embedded products, universal serial bus, or USB, drives, digital...

  • Page 68
    ...-cost NAND memory for use in a variety of end-products, including consumer, mobile phone and computing devices. We are a one-stop-shop for our retail and OEM customers, selling in high volumes all major NAND flash storage card formats for our target markets. Our revenues are driven by product sales...

  • Page 69
    ...are designed for use in mobile phones. Our CF removable cards, available in capacities up to 128 gigabytes, with up to 100 megabyte per second write-speeds, are well-suited for a range of consumer applications, including digital cameras. Our professional products include the SanDisk Ultra®, SanDisk...

  • Page 70
    ... secure, authorized access to corporate information. We also offer a line of SanDisk® Memory Vault products available in capacities up to 16 gigabytes, designed for very long-term storage of photos, videos and other consumer content. • Digital Media Players. Sansa® is our branded line of flash...

  • Page 71
    ... competencies are in high-density flash memory process, module integration, device design and reliability; securing data on a flash memory device; controller design and firmware; system-level integration; multi-die stacking and packaging technology; and low-cost system testing. 7 Annual Report

  • Page 72
    ... operating systems for personal computers, or PCs, mobile phones, tablets, ultrabooks, notebooks, digital cameras, gaming devices, GPS devices, servers and other computing devices Our proprietary controller and sophisticated firmware technologies permit our flash storage solutions to achieve a high...

  • Page 73
    ... well as manufacturers and resellers of flash memory cards, USB drives, embedded flash memory solutions, SSDs and digital audio players. We believe that our ability to compete successfully depends on a number of factors, including price, quality and on-time delivery of products; product performance...

  • Page 74
    ... memory, in the form of white label cards, wafers or components, to certain companies who sell flash products that may ultimately compete with our branded products in the retail or OEM channels. Client Storage Solution Manufacturers. In the market for client SSDs, we face competition from large NAND...

  • Page 75
    ... compete with our product offerings and many companies are attempting to develop memory cells that use different designs and materials in order to increase storage capacity and reduce memory costs. These potential competitive technologies include several types of 3D memory, a version of which we...

  • Page 76
    ... Chief Operating Officer, Executive Vice President, Vice President of Engineering, Vice President of Product Development, and Director of Memory Design and Product Engineering. Mr. Mehrotra has more than 30 years of experience in the non-volatile semiconductor memory industry, including engineering...

  • Page 77
    ... weakness in our markets; expansion of industry supply, including low-grade supply useable in limited markets, creating excess supply of flash products in the market, causing our average selling prices to decline faster than our costs; timing, volume and cost of wafer production from Flash Ventures...

  • Page 78
    ... their markets. If our OEM customers are not successful in selling their current or future products in sufficient volume, or should they decide not to use our products, our operating results and financial condition could be harmed. Our OEM revenue is dependent in part upon our embedded flash storage...

  • Page 79
    ...other economic factors may reduce demand for our products and harm our business, financial condition and operating results. Our business and the markets we address are subject to significant fluctuations in supply and demand, and our commitments to Flash Ventures may result in periods of significant...

  • Page 80
    ... advanced purchase order lead-times, the product mix available and the high cost. Our inability to obtain adequate or the right mix of supply to meet demand may cause us to lose sales, market share and corresponding profits, which would harm our operating results. We depend on Flash Ventures and...

  • Page 81
    ... are not successful, due to weak consumer retail demand, competitive issues, decline in consumer confidence, or other factors, we could experience reduced sales as well as substantial product returns or price protection claims, which would harm our business, financial condition and operating results...

  • Page 82
    ...and products for NAND-based flash memory. Our future growth is dependent on the development of new markets, new applications and new products for NAND-based flash memory. Historically, the digital camera market provided the majority of our revenues; however the mobile market, including mobile phones...

  • Page 83
    ...reduce the need for physical flash storage within electronic devices. These alternative technologies could negatively impact the overall market for flash-based products, which could seriously harm our operating results. We develop new applications, products, technologies and standards, which may not...

  • Page 84
    ... manufacturers and flash memory chip producers are currently advocating and developing a new standard, referred to as Universal Flash Storage, or UFS, for flash memory cards used in mobile phones. Intel and Micron have also developed a new specification for a NAND flash interface, called Open NAND...

  • Page 85
    ... companies who sell flash products that may ultimately compete with our branded products in the retail or OEM channels. This could harm our branded market share and reduce our sales and profits. Client Storage Solution Manufacturers. In the market for client SSDs, we face competition from large NAND...

  • Page 86
    ...declines in general economic conditions. The flash memory industry has several times in the past experienced significant excess supply, reduced demand, high inventory levels and accelerated declines in selling prices. If we again experience oversupply of NAND flash products, we may be forced to hold...

  • Page 87
    ... products with leading-edge technologies such as multi-stack die packages and to provide order fulfillment. In addition, our Shanghai, China facility is responsible for packaging and shipping our retail products within Asia and Europe. We plan to further expand our assembly and test manufacturing...

  • Page 88
    ... Japanese yen, which would harm our gross margins, operating results, cost of future Flash Venture funding and increase the risk of asset impairment. We also have foreign currency exposures related to certain non-U.S. dollar-denominated revenue and operating expenses in Europe and Asia. Additionally...

  • Page 89
    ...lose market share due to price competition or we must write-down inventory, our operating results and financial condition could be harmed. Conversely, under conditions of tight flash memory supply, we may be unable to adequately increase our production volumes or secure sufficient supply in order to...

  • Page 90
    ... be able to develop or enhance our technology or products, fulfill our obligations to Flash Ventures, take advantage of future opportunities, grow our business or respond to competitive pressures or unanticipated industry changes, any of which could harm our business. We may be unable to protect our...

  • Page 91
    ... not be able to develop such technology or acquire such licenses on terms acceptable to us, or at all. We may also be required to pay significant damages and/or discontinue the use of certain manufacturing or design processes. In addition, we or our suppliers could be enjoined from selling some or...

  • Page 92
    ...to build inventory levels in advance of our projected high volume selling seasons. Because of our international business and operations, we must comply with numerous international laws and regulations, and we are vulnerable to political instability and other risks related to international operations...

  • Page 93
    ... in earnings estimates by analysts. In addition, in recent years the stock market has experienced significant price and volume fluctuations and the market prices of the securities of high-technology and semiconductor companies have been especially volatile, often for reasons outside the control of...

  • Page 94
    ... key personnel could disrupt our business. Our success greatly depends on the continued contributions of our senior management and other key research and development, sales, marketing and operations personnel. We do not have employment agreements with any of our executive officers and they are free...

  • Page 95
    ... or ship finished product from, our Shanghai, China facility or our Asia-based contract manufacturers. As a result, our business and operating results may be harmed. Annual Report Price increases could reduce our overall product revenues and harm our financial position. In the first half of fiscal...

  • Page 96
    ... with our customers and suppliers, and otherwise harm our operations and financial condition. Government regulators, or our customers may require us to comply with product or manufacturing standards that are more restrictive than current laws and regulations related to environmental matters...

  • Page 97
    ... financial results and the market price of our stock could significantly decline. Additionally, adverse publicity related to the disclosure of a material weakness in internal controls could harm our reputation, business and stock price. Any internal control or procedure, no matter how well designed...

  • Page 98
    ...-the-counter cash-settled derivative transactions and/or purchase or sell shares of our common stock in open market and/or privately negotiated transactions following the pricing of the notes, including during any observation period related to a conversion of notes. The dealers or their respective...

  • Page 99
    ... and owned facilities in Milpitas, California total approximately 815,000 square feet and house or will house our corporate offices, including personnel from engineering, sales, marketing, operations and administration. The lease agreements on the two remaining leased buildings will expire in 2013...

  • Page 100
    ..., RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market For Our Common Stock. Our common stock is traded on the NASDAQ Global Select Market, or NASDAQ, under the symbol "SNDK." The following table summarizes the high and low sale prices for our common stock as reported by...

  • Page 101
    ... reported dates are the last trading dates of our fiscal quarters (which end on the Sunday closest to March 31, June 30 and September 30, respectively) and year (which ends on the Sunday closest to December 31). $150 $100 $50 $0 2006 2007 2008 2009 2010 2011 SanDisk Corporation S&P 500 Index...

  • Page 102
    ... FINANCIAL DATA Fiscal years ended January 2, January 3, December 28, 2011(2) 2010(3) 2008(4) (In thousands, except per share data) January 1, 2012(1) December 30, 2007(5) Revenues Product ...License and royalty ...Total revenues ...Cost of product revenues ...Gross profit ...Operating income...

  • Page 103
    ... and devices. We sell our products globally to OEM and retail customers. We design, develop and manufacture data storage solutions in a variety of form factors using our flash memory, proprietary controller and firmware technologies. We purchase the vast majority of our NAND flash memory supply...

  • Page 104
    ...in order to produce leading-edge, low-cost NAND flash memory for use in a variety of end-products, including consumer, mobile phone and computing devices. We are a one-stop-shop for our retail and OEM customers, selling in high volumes all major NAND flash storage card formats for our target markets...

  • Page 105
    ... price protection and/or right of return and, therefore, the sales and related costs of these transactions are deferred until the distributors or retailers sell the merchandise to their end customer, or the rights of return expire. At January 1, 2012 and January 2, 2011, deferred income from sales...

  • Page 106
    ... basis and, if necessary, reassign goodwill using a relative fair value allocation approach. For our annual goodwill impairment test in fiscal year 2011, we adopted the authoritative guidance issued by the Financial Accounting Standards Board in September 2011. In accordance with this guidance, we...

  • Page 107
    ... memory units sold with an increase in average capacity of 23%. The increase in product revenues in fiscal year 2010, over fiscal year 2009, was primarily due to higher OEM revenues, principally from cards and embedded solutions for the mobile phone market and full-year sales of private label cards...

  • Page 108
    ...cards for the mobile market and USB flash drives. Product revenues in EMEA decreased slightly in fiscal year 2011, compared to fiscal year 2010, due primarily to a decrease in sales to certain mobile OEM customers. Product revenues in Asia-Pacific, which includes Japan, increased in fiscal year 2010...

  • Page 109
    ... and development expense increased from fiscal year 2009 primarily due to higher third-party engineering costs of $23 million and employee-related costs of $14 million related to increased headcount and compensation expense. Sales and Marketing. FY 2011 Percent Percent Change FY 2010 Change (In...

  • Page 110
    ...of ($21) million related to the modification of stock awards and benefits pursuant to the retirement agreement of our former Chief Executive Officer in fiscal year 2010 that did not recur in fiscal year 2011, offset by higher legal costs of $8 million. Our fiscal year 2010 general and administrative...

  • Page 111
    ... to the sale of the net assets of our mobile phone SIM card business and the sale of certain public equity securities. "Other income (expense), net" was a net expense for fiscal year 2009 due to bank charges and fees of ($11) million related to the restructuring of Flash Ventures' master equipment...

  • Page 112
    ... financial position, results of operations or liquidity. Non-GAAP Financial Measures Reconciliation of Net Income. Fiscal years ended January 1, January 2, January 3, 2012 2011 2010 (In millions except per share amounts) Net income ...Share-based compensation ...Amortization of acquisition-related...

  • Page 113
    ... expenses that we do not believe are reflective of ongoing operating results. Further, we believe that it is useful to exclude share-based compensation expense for investors to better understand the long-term performance of our core business and to facilitate comparison of our results to those of...

  • Page 114
    ...million, purchases of technology and other assets of ($100) million and net loans and investments made to Flash Ventures of ($66) million. In fiscal year 2010, net cash used in investing activities was primarily related to a net purchase of short and long-term marketable securities of ($2.6) billion...

  • Page 115
    ... us from funding Flash Ventures, increasing our wafer supply, developing or enhancing our products, taking advantage of future opportunities, engaging in investments in or acquisitions of companies, growing our business, responding to competitive pressures or unanticipated industry changes, any of...

  • Page 116
    ... us from funding Flash Ventures, increasing our wafer supply, developing or enhancing our products, taking advantage of future opportunities, engaging in investments in or acquisitions of companies, growing our business, responding to competitive pressures or unanticipated industry changes, any of...

  • Page 117
    ... bond hedge agreement. Ventures with Toshiba. We are a 49.9% owner in each entity within Flash Ventures, our business ventures with Toshiba to develop and manufacture NAND flash memory products. These NAND flash memory products are manufactured by Toshiba at its Yokkaichi, Japan operations using the...

  • Page 118
    ... report. For a discussion of foreign operating risks and foreign currency risks, see Part I, Item 1A, "Risk Factors." ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are exposed to financial market risks, including changes in interest rates and foreign currency exchange rates...

  • Page 119
    ... Japanese yen flash memory costs. These contracts are designated as cash flow hedges and are carried on our balance sheet at fair value with the effective portion of the contracts' gains or losses included in accumulated OCI and subsequently recognized in cost of product revenues in the same period...

  • Page 120
    ... periods specified in the SEC's rules and regulations and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. Report of Management on Internal Control Over Financial Reporting...

  • Page 121
    ...control over financial reporting (as defined in Exchange Act Rule 13a-15(f)) during the quarter ended January 1, 2012 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION Not applicable. Annual Report...

  • Page 122
    ... Committee Report on Executive Compensation," "Compensation Discussion and Analysis," "Summary Compensation Table - Fiscal 2009-2011," "Outstanding Equity Awards at Fiscal 2011 Year-End" and "Option Exercises and Stock Vested in Fiscal 2011" in our Proxy Statement for our 2012 Annual Meeting of...

  • Page 123
    This is a TAB type table. Insert conts here. PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) Documents filed as part of this report 1) All financial statements Index to Financial Statements Page Reports of Independent Registered Public Accounting Firm ...Consolidated Balance Sheets...

  • Page 124
    [THIS PAGE INTENTIONALLY LEFT BLANK]

  • Page 125
    This is a TAB type table. Insert conts here. SANDISK CORPORATION INDEX TO FINANCIAL STATEMENTS Page Reports of Independent Registered Public Accounting Firm ...Consolidated Balance Sheets ...Consolidated Statements of Operations ...Consolidated Statements of Comprehensive Income ...Consolidated ...

  • Page 126
    ... three years in the period ended January 1, 2012, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), SanDisk Corporation's internal control over financial reporting...

  • Page 127
    This is a TAB type table. Insert conts here. REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM The Board of Directors and Stockholders of SanDisk Corporation We have audited SanDisk Corporation's internal control over financial reporting as of January 1, 2012, based on criteria established in...

  • Page 128
    SANDISK CORPORATION CONSOLIDATED BALANCE SHEETS January 1, January 2, 2012 2011 (In thousands, except for share and per share amounts) ASSETS Current assets: Cash and cash equivalents ...Short-term marketable securities ...Accounts receivable from product revenues, net ...Inventory ...Deferred ...

  • Page 129
    This is a TAB type table. Insert conts here. SANDISK CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS Fiscal years ended January 1, January 2, January 3, 2012 2011 2010 (In thousands, except per share amounts) Revenues Product ...License and royalty ...Total revenues ...Cost of product revenues ...

  • Page 130
    SANDISK CORPORATION CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME January 1, 2012 Fiscal years ended January 2, 2011 (In thousands) January 3, 2010 Net income ...Other comprehensive income, before tax: Unrealized holding gain on marketable securities...related...18,100) 12,100 ...financial statements. F-6

  • Page 131
    This is a TAB type table. Insert conts here. SANDISK CORPORATION CONSOLIDATED STATEMENTS OF EQUITY Common Retained Accumulated Stock Capital in Earnings Other Total NonCommon Par Excess of (Accumulated Comprehensive Stockholders' controlling Stock Shares Value Par Value Deficit) Income Equity ...

  • Page 132
    SANDISK CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS January 1, 2012 Fiscal years ended January 2, January 3, 2011 2010 (In thousands) Cash flows from operating activities: Net income ...Adjustments to reconcile net income to net cash provided by operating activities: Deferred and other taxes ...

  • Page 133
    ... June 1, 1988. The Company designs, develops, markets and manufactures flash storage card products used in a wide variety of consumer electronics products. The Company operates in one segment, flash memory storage products. Basis of Presentation. The Company's fiscal year ends on the Sunday closest...

  • Page 134
    ... Revenue from patent licensing arrangements is recognized when earned, estimable and realizable. The timing of revenue recognition is dependent on the terms of each license agreement and on the timing of sales of licensed products. The Company generally recognizes royalty revenue when it is reported...

  • Page 135
    ...$41.9 million and ($90.0) million in fiscal years 2011, 2010 and 2009, respectively. Cash Equivalents, Short and Long-Term Marketable Securities. Cash equivalents consist of short-term, highly liquid financial instruments with insignificant interest rate risk that are readily convertible to cash and...

  • Page 136
    ... by management, additional reductions in inventory valuation may be required. The Company's finished goods inventory includes consigned inventory held at customer locations as well as at third-party fulfillment centers and subcontractors. Other Long-Lived Assets. Intangible assets with finite useful...

  • Page 137
    ... financial statements. Note 3: Investments and Fair Value Measurements The Company's total cash, cash equivalents and marketable securities was as follows (in thousands): January 1, 2012 January 2, 2011 Cash and cash equivalents ...Short-term marketable securities ...Long-term marketable securities...

  • Page 138
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS primarily valued using quoted market prices for similar instruments and nonbinding market prices that are corroborated by observable market data. The Company uses inputs such as actual trade data, benchmark yields, broker/dealer quotes and other similar ...

  • Page 139
    ...(50) Annual Report The gross unrealized loss related to U.S. Treasury and government agency securities, corporate and municipal notes and bonds and asset-backed securities was primarily due to changes in interest rates. The gross unrealized loss on all available-for-sale fixed income securities at...

  • Page 140
    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table shows the gross realized gains and (losses) on sales of available-for-sale securities (in thousands). Fiscal years ended January 2, January 3, 2011 2010 January 1, 2012 Gross realized gains ...Gross realized losses ... $ 36,762 (2,213...

  • Page 141
    ... the Company's future Japanese yen purchases that are expected to occur during fiscal year 2012. In the fourth quarter of fiscal year 2011, the Company sold certain available-for-sale investments in equity securities. In connection with the sale, the Company settled the cash flow hedge designated to...

  • Page 142
    ... of gain (loss) reclassified from OCI to the Statements of Operations during the year ended January 1, January 2, 2012 2011 Amount of gain (loss) recognized in OCI January 1, January 2, 2012 2011 Foreign exchange contracts ...Equity market risk contract ... $ 33,224 (3,024) $ 27,825 (7,585...

  • Page 143
    ... Consolidated Statements of Operations. The effect of non-designated derivative contracts on the Company's results of operations recognized in other income (expense) for fiscal years 2011, 2010 and 2009 was as follows (in thousands): January 1, 2012 Fiscal years ended January 2, January 3, 2011 2010...

  • Page 144
    ... long-term loans to Flash Ventures to fund new process technologies and additional wafer capacities. The Company aggregates its Notes Receivables to Flash Ventures into one class of financing receivables due to the similar ownership interest in Flash Ventures and common structure. For all reporting...

  • Page 145
    ... Balance Sheets and the activity was as follows (in thousands): Annual Report January 1, 2012 January 2, 2011 January 3, 2010 Balance, beginning of period ...Additions and adjustments to cost of product revenues ...Usage ...Balance, end of period ... $ 24,702 29,444 (27,189) 26,957 $ 25,909...

  • Page 146
    ... investments, hedging activities and foreign currency translation was as follows (in thousands): Fiscal years ended January 2, January 3, 2011 2010 January 1, 2012 Available-for-sale investments ...Foreign currency translation ...Hedging activities ... $ 3,342 10,315 2,504 16,161 $ (6,301) 20...

  • Page 147
    ...technology licenses and patents is recorded to cost of product revenues or research and development based upon the use of the technology. Amortization expense of intangible assets totaled $65.5 million, $20.7 million and $20.2 million in fiscal years 2011, 2010 and 2009, respectively. Annual Report...

  • Page 148
    ...STATEMENTS The annual expected amortization expense of intangible assets as of January 1, 2012, excluding acquired in-process research and development, is presented below (in thousands): Estimated Amortization Expense Acquisition-related Technology Licenses Intangible Assets and Patents Fiscal year...

  • Page 149
    ... during the five business-day period after any five consecutive trading-day period (the "measurement period") in which the trading price per note for each day of such measurement period was less than 98% of the product of the last reported sale price of the Company's common stock and the conversion...

  • Page 150
    ... sell to the Company up to approximately 14 million shares of the Company's common stock, which is the number of shares initially issuable upon conversion of the 1% Notes due 2013 in full, at a price of $82.36 per share. During fiscal year 2011, due to the repurchase of a portion of the outstanding...

  • Page 151
    This is a TAB type table. Insert conts here. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The components of the repurchase and related loss on early extinguishment of a portion of the 1% Notes due 2013 are as follows (in thousands): Fiscal year ended January 1, 2012 Allocation of consideration paid:...

  • Page 152
    ... product of the last reported sale price of the Company's common stock and the conversion rate on each such day; 2) during any calendar quarter after the calendar quarter ending September 30, 2010, if the last reported sale price of the Company's common stock for 20 or more trading days in a period...

  • Page 153
    ... Major Customers. The Company markets and sells flash memory products in the U.S. and in foreign countries through its sales personnel, dealers, distributors, retailers and subsidiaries. The Company's Chief Operating Decision Maker, its President and Chief Executive Officer, evaluates performance of...

  • Page 154
    ... in fiscal years 2010 and 2009. All of the Company's flash memory system products require silicon wafers for the memory and controller components. The Company's memory wafers or components are currently supplied almost entirely from Flash Ventures and the controller wafers are primarily manufactured...

  • Page 155
    ... receive option grants or other stock awards at designated intervals over their period of board service. The 2005 Plan also includes a performance-based cash bonus awards program for executive officers classified under Section 16 of the Securities Exchange Act of 1934, as amended. Grants and awards...

  • Page 156
    ...: January 1, 2012 Fiscal years ended January 2, January 3, 2011 2010 Option Plan Shares Dividend yield ...Expected volatility ...Risk-free interest rate ...Expected term ...Estimated annual forfeiture rate ...Weighted average fair value at grant date ...Employee Stock Purchase Plan Shares Dividend...

  • Page 157
    ...SARs. A summary of stock option and stock appreciation rights ("SARs") activity under all of the Company's share-based compensation plans as of January 1, 2012 and changes during the three fiscal years ended January 1, 2012 is presented below (in thousands, except exercise price and contractual term...

  • Page 158
    ...): Fiscal years ended January 2, 2011 January 1, 2012 January 3, 2010 Share-based compensation expense by caption: Cost of product revenues ...Research and development ...Sales and marketing ...General and administrative ...Total share-based compensation expense ...Total tax benefit recognized...

  • Page 159
    ... fiscal year 2010, the Company recognized $17.3 million of expense related to the modification of stock awards, pursuant to the retirement agreement with the Company's former Chief Executive Officer. In fiscal year 2009, the Company identified that its third-party equity software contained a feature...

  • Page 160
    ... as follows: January 1, 2012 Fiscal years ended January 2, January 3, 2011 2010 U.S. federal statutory rate ...State taxes, net of federal benefit ...Non-deductible share-based compensation expense ...Valuation allowance ...Tax-exempt interest income ...Foreign earnings at other than U.S. rates...

  • Page 161
    ... to, earnings history, projected future outcomes, industry and market trends and the nature of each of the deferred tax assets, the Company determined that it is able to realize most of its deferred tax assets with the exception of certain loss and credit carryforwards. During fiscal year 2010, the...

  • Page 162
    ... the Company's financial results for fiscal years 2011, 2010 and 2009. Note 11: Net Income per Share The following table sets forth the computation of basic and diluted net income per share (in thousands, except per share amounts): Fiscal years ended January 2, January 3, 2011 2010 January 1, 2012...

  • Page 163
    ... in fiscal year 2004. In the venture, the Company and Toshiba have collaborated in the development and manufacture of NAND flash memory products. These NAND flash memory products are manufactured by Toshiba at its 300-millimeter wafer fabrication facility ("Fab 3") located in Yokkaichi, Japan, using...

  • Page 164
    ... in fiscal year 2010. In the venture, the Company and Toshiba collaborate to develop and manufacture NAND flash memory products. In this venture, NAND flash memory products are manufactured by Toshiba at a new 300-millimeter wafer fabrication facility ("Fab 5") located in Yokkaichi, Japan, using the...

  • Page 165
    ... Japanese yen and U.S. dollar equivalent based upon the exchange rate at January 1, 2012. Master Lease Agreements by Execution Date Lease Type Lease Amounts (Yen in billions) (Dollars in thousands) Expiration Flash Partners March 2007 ...February 2008 ...April 2010 ...January 2011 ...November 2011...

  • Page 166
    ... CONSOLIDATED FINANCIAL STATEMENTS The following table details the breakdown of the Company's remaining guarantee obligations between the principal amortization and the purchase option exercise price at the end of the term of the master lease agreements, in annual installments as of January 1, 2012...

  • Page 167
    This is a TAB type table. Insert conts here. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Flash Alliance. Flash Alliance sells and leases back from lessors a portion of its tools and has entered into equipment master lease agreements totaling 200.0 billion Japanese yen, or approximately $2.59 billion...

  • Page 168
    ...in many cases the Company will share in the expenses associated with the defense and cost of settlement associated with such claims. This agreement provides limited protection for the Company against third-party claims that NAND flash memory products manufactured and sold by Flash Ventures infringes...

  • Page 169
    ... dollar, which are subject to fluctuation in exchange rates prior to payment and have been translated using the exchange rate at January 1, 2012. Excludes amounts related to the master lease agreements' purchase option exercise price at final lease term. (2) (3) Annual Report (4) (5) (6) F-45

  • Page 170
    ... with respect to the Flash Ventures master lease agreements, take-or-pay supply arrangements and research and development cost sharing are described in Note 12, "Commitments, Contingencies and Guarantees." The financial and other support provided by the Company in all periods presented was either...

  • Page 171
    ... ...Long-term liabilities ... $ $ $ 1,125 5,089 6,214 2,269 2,594 $ $ $ 1,028 4,187 5,215 1,632 2,465 Annual Report The following summarizes the aggregated financial information for Flash Ventures for fiscal years 2011, 2010 and 2009, respectively (in millions). Flash Ventures' year-ends are...

  • Page 172
    ... exchange offer upon consummation of which such person or group would beneficially own 15% or more of the Company's common stock. Note 15: Business Acquisition Pliant Technology, Inc. On May 24, 2011, the Company completed its acquisition of Pliant, a developer of enterprise flash storage solutions...

  • Page 173
    ... the Company's supply of NAND flash and complementary products, which will enhance the Company's overall product portfolio, and is not deductible for tax purposes. Acquisition-related costs of $1.5 million during the fiscal year ended January 1, 2012 were related to legal, regulatory and accounting...

  • Page 174
    ... The flash memory industry is characterized by significant litigation seeking to enforce patent and other intellectual property rights. The Company's patent and other intellectual property rights are primarily responsible for generating license and royalty revenue. The Company seeks to protect its...

  • Page 175
    ...Company and Kingston have the right to re-file the dismissed claims if (a) an appellate court reverses, remands, or vacates, in whole or in part, the District Court's September 22, 2010 Claim Construction Order, or the District Court's February 15, 2010 Summary Judgment, and (b) the case is returned...

  • Page 176
    ... 25, 2010, Ritz Camera & Image, LLC ("Ritz") filed a complaint in the U.S. District Court for the Northern District of California (the "District Court"), alleging that the Company violated federal antitrust law by conspiring to monopolize and monopolizing the market for flash memory products. The...

  • Page 177
    ... conduct related to the licensing practices and operations of the SD-3C and contained the same claims as the original complaint, except for the patent misuse claim. The defendants filed a motion to dismiss the SAC on October 6, 2011. By Order dated January 3, 2012, the Court granted defendants...

  • Page 178
    .... Note 17: Supplementary Financial Data (Unaudited) April 3, 2011(1) Fiscal quarters ended July 3, October 2, January 1, 2011(1) 2011(1) 2012(1) (In thousands, except per share data) 2011 Revenues Product ...License and royalty ...Total revenues ...Gross profit ...Operating income ...Net income...

  • Page 179
    ...'s former Chief Executive Officer. The sale of net assets of the Company's mobile phone SIM card business resulted in a gain recorded in the first quarter of fiscal year 2010. April 4, 2010 Fiscal quarters ended July 4, October 3, 2010 2010 (In thousands) January 2, 2011 Share-based compensation...

  • Page 180
    [THIS PAGE INTENTIONALLY LEFT BLANK]

  • Page 181
    ... Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. SANDISK CORPORATION (Registrant) Dated: February 23, 2012 By: /S/ JUDY BRUNER Judy Bruner Executive Vice President, Administration and Chief Financial Officer...

  • Page 182
    ... Title Date By: /S/ STEVEN J. GOMO Director February 17, 2012 Steven J. Gomo By: /S/ EDDY W. HARTENSTEIN Director February 21, 2012 Eddy W. Hartenstein By: /S/ CHENMING HU Director February 17, 2012 Dr. Chenming Hu By: /S/ CATHERINE P. LEGO Director February 15, 2012 Catherine...

  • Page 183
    ...dated December 14, 2011. Rights Agreement, dated as of September 15, 2003, by and between the Registrant and Computershare Trust Company, Inc. Amendment No. 1 to Rights Agreement, dated...2017, dated as of August 25, 2010, by and between the Registrant and The Bank of New York Mellon Trust Company, ...

  • Page 184
    ... Reference Exhibit File No. No. Filing Date Provided Herewith 10.1 License Agreement, dated September 6, 1988, between the Registrant and Dr. Eli Harari. The Registrant's 1995 Stock Option Plan, amended and restated on January 2, 2002.†The Registrant's 1995 Non-Employee Directors Stock Option...

  • Page 185
    ... Insert conts here. Exhibit Number Exhibit Title Form Incorporated by Reference Exhibit File No. No. Filing Date Provided Herewith 10.17 Form of Amended and Restated Change of Control Benefits Agreement entered into by and between the Registrant and its named executive officers.†New Master...

  • Page 186
    ... and SanDisk Flash B.V.± Patent Indemnification Agreement, dated as of July 13, 2010, by and among Toshiba Corporation, the Registrant and SanDisk Flash B.V.± Operating Agreement of Flash Forward, Ltd. by and between Toshiba Corporation and SanDisk Flash B.V.± E-4 10-Q 000-26734 10.1 9/9/2011...

  • Page 187
    ...between the Registrant and its directors and officers. Form of Amended and Restated Change of Control Benefits Agreement entered into by and between the Registrant and its Named Executive Officers other than the Registrant's CEO.†Agreement, dated as of July 30, 2010, by and between the Registrant...

  • Page 188
    ... Partners Limited, and Flash Alliance Limited.± Equipment Purchase Agreement, dated as of January 29, 2009, by and among the Registrant, SanDisk (Ireland) Limited, SanDisk (Cayman) Limited, Toshiba Corporation, Flash Partners Limited, and Flash Alliance Limited.± Pliant Technology, Inc. 2007 Stock...

  • Page 189
    ...a request for confidential treatment, certain portions of this exhibit have been redacted from the publicly filed document and have been furnished separately to the Securities and Exchange Commission as required by Rule 24b-2 under the Securities Exchange Act of 1934, as amended. Annual Report E-7

  • Page 190
    [THIS PAGE INTENTIONALLY LEFT BLANK]

  • Page 191
    ... Mehrotra President and Chief Executive Officer Judy Bruner Executive Vice President, Administration and Chief Financial Officer James F. Brelsford Chief Legal Officer and Senior Vice President of IP Licensing Sumit Sadana Senior Vice President and Chief Strategy Officer BOARD OF DIRECTORS Kevin...

  • Page 192
    ...SanDisk Mobile Ultra, SanDisk Ultra and Sansa are trademarks of SanDisk Corporation, registered in the United States and other countries. iNAND Extreme and SanDisk iSSD are trademarks of SanDisk Corporation. The microSDXC, SDHC and SDXC marks and logos are trademarks of SD-3C, LLC. Other brand names...