SanDisk 2014 Annual Report Download - page 53

Description of Plan-Based Awards
All actual non-equity incentive plan payouts were made under the 2014 bonus program and are
disclosed in the Summary Compensation Table in the column entitled ‘‘Non-Equity Incentive Plan
Compensation.’’
During fiscal year 2014, each Named Executive Officer was awarded time-based RSU and stock
option awards. Each of these awards was granted under, and is subject to the terms of, the 2013 Plan. The
2013 Plan is administered by the Compensation Committee. The Compensation Committee has authority
to interpret the provisions and make all required determinations under the 2013 Plan. This authority
includes making required proportionate adjustments to outstanding awards upon the occurrence of certain
corporate events such as reorganizations, mergers and stock splits and making provision to ensure that any
tax withholding obligations incurred in respect of awards are satisfied. Awards granted under the 2013 Plan
are generally transferable only to a beneficiary of a Named Executive Officer upon his or her death.
However, the Compensation Committee may establish procedures for the transfer of awards to other
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 2013 Plan, if there is a change in control of the Company, each Named
Executive Officer’s outstanding share-based awards granted under the plan will generally become fully
vested and, in the case of options, exercisable, to the extent such outstanding awards are not substituted or
assumed in connection with the transaction. Any options that would vest in connection with a change in
control generally must be exercised prior to the change in control, or they will be canceled in exchange for
the right to receive a cash payment in connection with the change in control transaction. In addition, if
there is a change in control of the Company, the Compensation Committee may terminate the
performance period applicable to the cash incentive award and pro-rate (based on the number of days
during the performance period prior to the transaction) the bonus and performance objectives based on
year-to-date performance.
Restricted Stock Units
Each RSU reported in the table above and granted to the Named Executive Officers in fiscal year
2014 represents a contractual right to receive one share of the Company’s Common Stock if the vesting
requirements described below are satisfied. RSUs are credited to a bookkeeping account established by
the Company on behalf of each Named Executive Officer receiving such an award. The RSUs are subject
to a four (4) year vesting schedule, with 25% of the units vesting annually from the vesting commencement
date. Outstanding RSUs, however, may terminate earlier in connection with a change in control
transaction or a termination of the Named Executive Officer’s employment. Subject to any accelerated
vesting that may apply, the unvested portion of the RSU will immediately terminate upon a termination of
the Named Executive Officer’s employment.
RSUs will generally be paid in an equivalent number of shares of the Company’s Common Stock as
they vest. The Named Executive Officers are not entitled to voting rights with respect to the RSUs.
However, the Named Executive Officers are entitled to the following dividend equivalent rights with
respect to the RSUs. 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 RSUs have either been paid or terminated, then the
Company will credit the Named Executive Officer’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 RSUs (including any unvested RSUs)
as of the dividend record date. These dividend equivalents will be subject to the same vesting, payment and
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Proxy Statement