SanDisk 2012 Annual Report Download - page 43

Proxy Statement
accept. Notwithstanding the forgoing, to the extent required to avoid the imposition of additional taxes
under Section 409A of the Code, such transaction will only constitute a change in control for purposes
of the payment timing of such award if such transaction also constitutes a ‘change in control event,” as
defined in Treasury Regulation Section 1.409A-3(i)(5).
(viii) The plan administrator will also have the discretionary authority to structure one or more outstanding
options or stock appreciation rights under the Discretionary Grant Program so that those options or
stock appreciation rights will, immediately prior to the effective date of a hostile take-over, vest and
become exercisable as to all the shares of Common Stock at the time subject to those options or stock
appreciation rights. The plan administrator shall also have the discretionary authority to structure one
or more of the Company’s repurchase rights under the Discretionary Grant Program so that those rights
shall terminate automatically upon the consummation of such hostile take-over, and the shares subject
to those terminated rights shall thereupon vest in full. In addition, the plan administrator will have the
authority to structure one or more awards under the Stock Issuance and Cash Bonus Program so that
the shares of Common Stock subject to those awards will immediately vest upon the consummation of
a hostile take-over. Alternatively, the plan administrator may condition such vesting acceleration upon
the subsequent termination of an individual’s service within a designated period following the effective
date of such hostile take-over.
(ix) The plan administrator will have the discretionary authority to structure one or more unvested stock
issuances, RSUs, other share right awards or cash bonus awards under the Stock Issuance and Cash
Bonus Program so that the shares of Common Stock or cash subject to those issuances or awards shall
automatically vest (or vest and become issuable or payable) in whole or in part immediately upon the
occurrence of a change in control or hostile take-over or in the event an individual’s service with the
Company or the successor entity is terminated (actually or constructively) under certain circumstances
within a designated period following a change in control or hostile take-over.
(x) The portion of any incentive stock option accelerated in connection with a change in control or hostile
take-over shall remain exercisable as an incentive option only to the extent the applicable one hundred
thousand dollar ($100,000) limitation is not exceeded. To the extent such dollar limitation is exceeded,
the accelerated portion of such option shall be exercisable as a non-statutory option under the Federal
tax laws.
The acceleration of vesting in the event of a change in the ownership or control may be seen as an anti-
takeover provision and may have the effect of discouraging a merger proposal, a takeover attempt or other efforts
to gain control of the Company.
Changes in Capitalization. In the event any change is made to the outstanding shares of Common Stock by
reason of any recapitalization, stock dividend, stock split, combination of shares, exchange of shares or other
change in corporate structure effected without the Company’s receipt of consideration, appropriate adjustments
will be made to: (i) the maximum number and/or class of securities issuable under the 2013 Plan; (ii) the
maximum number and/or class of securities by which the share reserve may increase by reason of the expiration
or termination of unexercised options under the Predecessor Plans; (iii) the maximum number and/or class of
securities which may be issued without cash consideration under the Stock Issuance and Cash Bonus Program;
(iv) the maximum number and/or class of securities for which any one person, including any Non-Employee
Director, may be granted stock options, stand-alone stock appreciation rights, direct stock issuances (whether
vested or unvested) and other share-based awards under the 2013 Plan per calendar year; (v) the number and/or
class of securities and the exercise price or base price per share in effect under each outstanding option or stock
appreciation right; and (vi) the number and/or class of securities subject to each outstanding RSU or other stock-
based award and the cash consideration (if any) payable per share. Such adjustments will be designed to preclude
any dilution or enlargement of benefits under the 2013 Plan or the outstanding awards thereunder.
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