SanDisk 2011 Annual Report Download - page 29

Proxy Statement
based vesting requirements described below are satisfied. Restricted stock units are credited to a bookkeeping
account established by the Company on behalf of each Non-Employee Director.
Subject to the Non-Employee Director’s continued service, the units subject to the Initial Unit Grant vest in
four substantially equal annual installments on each of the first through fourth anniversaries of the grant date.
Subject to the Non-Employee Director’s continued service, the units subject to the Annual Unit Grant vest in one
installment on the earlier of (i) the first anniversary of the grant date or (ii) the day immediately 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 cessation of the Non-Employee Director’s
service, any unvested restricted stock units will generally terminate. However, restricted stock units granted to a
Non-Employee Director vest in full if the Non-Employee Director’s cessation of service is as a result of the
Director’s death or permanent disability.
Restricted stock units will generally be paid in an equivalent number of shares of the Common Stock as they
vest. Non-Employee Directors are not entitled to voting or dividend rights with respect to the restricted stock
units, and the restricted stock units generally may not be transferred, except to the Company or to a beneficiary
of the Non-Employee Director upon his or her death. However, non-Employee Directors are entitled to the
following dividend equivalent rights with respect to the restricted stock units. If the Company pays a cash
dividend on its Common Stock and the dividend record date occurs after the grant date and before all of the
restricted stock units have either been paid or terminated, then the Company will credit the Non-Employee
Director’s bookkeeping account with an amount equal to (i) the per-share cash dividend paid by the Company on
its Common Stock with respect to the dividend record date, multiplied by (ii) the total number of outstanding and
unpaid restricted stock units (including any unvested restricted stock units) as of the dividend record date. These
dividend equivalents will be subject to the same vesting, payment and other terms and conditions as the original
restricted stock units to which they relate (except that the dividend equivalents may be paid in cash or such other
form as the plan administrator may deem appropriate).
The Board administers the 2005 Plan as to Non-Employee Director awards and has the ability to interpret
and make all required determinations under the plan, subject to plan limits. This authority includes making
required proportionate adjustments to outstanding awards to reflect any impact resulting from various corporate
events such as reorganizations, mergers and stock splits.
Required Vote
The required vote for the election of each Director is as described above under “Voting Rights.”
Recommendation of the Board of Directors
The Board believes that Proposal No. 1 is in the Company’s best interests and the best interests of its
Stockholders’ and unanimously recommends a vote FOR the election of each of the Director nominees.
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