Document:

exv10w8

 

Exhibit 10.8

DIRECTOR GRANT

SANDISK CORPORATION

RESTRICTED STOCK UNIT ISSUANCE AGREEMENT

RECITALS

          A. The Plan is to designed to provide equity incentives to selected Employees, non-employee
Board members and consultants and other independent advisors in order to attract and retain their
services for the Corporation (or any Parent or Subsidiary).

          B. Participant is a non-employee Board member to whom an equity incentive award is to be made
pursuant to the Automatic Grant Program under the Plan.

          C. All capitalized terms in this Agreement shall have the meaning assigned to them in the
attached Appendix A.

NOW, THEREFORE, it is hereby agreed as follows:

          1. Grant of Restricted Stock Units. Participant is hereby awarded, as of the Award
Date, Restricted Stock Units under the Automatic Grant Program. Each Restricted Stock Unit
represents the right to receive one share of Common Stock on the vesting date of that unit. The
number of shares of Common Stock subject to the awarded Restricted Stock Units, the applicable
vesting schedule for those shares, the dates on which those vested shares shall become issuable to
Participant and the remaining terms and conditions governing the award (the “Award”) shall be as
set forth in this Agreement.

AWARD SUMMARY

	 	 	 
	Award Date:

	 	                                         200_
	 
	 	 
	Number of Shares

	 	[___]shares of Common Stock (the “Shares”)
	Subject to Award:
	 	 
	 
	 	 
	Vesting Schedule:

	 	The Shares shall vest in one or more
installments in accordance with the Vesting
Schedule set forth on attached Schedule I.
However, the Shares will be subject to
accelerated vesting pursuant to the provisions
of Paragraph 5 of this Agreement.
	 
	 	 
	Issuance Schedule

	 	The Shares in which the Participant vests in
accordance with the Vesting Schedule will be
issuable immediately upon vesting.

 

 

          2. Limited Transferability. Prior to actual receipt of the Shares which vest hereunder,
the Participant may not transfer any interest in the Award or the underlying Shares. Any Shares
which vest hereunder but which otherwise remain unissued at the time of the Participant’s death may
be transferred pursuant to the provisions of the Participant’s will or the laws of inheritance or
to the Participant’s designated beneficiary or beneficiaries of this Award. The Participant may
also direct the Corporation to issue the stock certificates for any Shares which in fact vest and
become issuable under the Award during his or her lifetime to one or more designated family members
or a trust established for the Participant and/or his or her family members. The Participant may
make such a beneficiary designation or certificate directive at any time by filing the appropriate
form with the Plan Administrator or its designee.

          3. Cessation of Service. Should the Participant cease Service for any reason prior to
vesting in one or more Shares subject to this Award, then the Award will be immediately cancelled
with respect to those unvested Shares, and the number of Restricted Stock Units will be reduced
accordingly. The Participant shall thereupon cease to have any right or entitlement to receive any
Shares under those cancelled units.

          4. Stockholder Rights and Dividend Equivalents

               (a) The holder of this Award shall not have any stockholder rights, including voting or
dividend rights, with respect to the Shares subject to the Award until the Participant becomes the
record holder of those Shares following their actual issuance.

               (b) Notwithstanding the foregoing, should any dividend or other distribution payable other
than in shares of Common Stock, whether regular or extraordinary, be declared and paid on the
outstanding Common Stock while one or more Shares remain subject to this Award (i.e., those Shares
are not otherwise issued and outstanding for purposes of entitlement to the dividend or
distribution), then a special book account shall be established for the Participant and credited
with a phantom dividend equivalent to the actual dividend or distribution which would have been
paid on those Shares had they been issued and outstanding and entitled to that dividend or
distribution. As the Shares subsequently vest hereunder, the phantom dividend equivalents credited
to those Shares in the book account shall be distributed to the Participant (in cash or such other
form as the Plan Administrator may deem appropriate in its sole discretion) concurrently with the
issuance of the vested Shares to which those phantom dividend equivalents relate.

          5. Special Vesting Acceleration.

               (a) Should a Change in Control occur during Participant’s period of Service, then the
Restricted Stock Units at the time subject to this Award will vest immediately prior to the closing
of the Change in Control. The Shares subject to those vested units will be issued immediately upon
such vesting (or otherwise converted into the right to receive the same consideration per share of
Common Stock payable to the other stockholders of the Corporation in consummation of that Change in
Control).

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               (b) Should Participant cease Service by reason of death or Permanent Disability, then the
Restricted Stock Units at the time subject to this Award will vest immediately, and the Shares
subject to those vested units will be issued as soon as administratively practicable following such
cessation of Service.

               (c) This Agreement shall not in any way affect the right of the Corporation to adjust,
reclassify, reorganize or otherwise change its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

          6. Adjustment in Shares. Should any change be made to the Common Stock by reason of
any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or
other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of
consideration, appropriate adjustments shall be made to the total number and/or class of securities
issuable pursuant to this Award in order to reflect such change and thereby preclude a dilution or
enlargement of benefits hereunder.

          7. Issuance of Shares of Common Stock. As soon as administratively practicable
following each date one or more Shares vest in accordance with the provisions of this Agreement,
the Corporation shall issue to or on behalf of the Participant a certificate (which may be in
electronic form) for the shares of Common Stock which vest on that date under the Award and shall
concurrently distribute to the Participant any phantom dividend equivalents with respect to those
Shares.

          8. Compliance with Laws and Regulations. The issuance of shares of Common Stock
pursuant to the Award shall be subject to compliance by the Corporation and Participant with all
applicable requirements of law relating thereto and with all applicable regulations of any stock
exchange (or the Nasdaq National Market, if applicable) on which the Common Stock may be listed for
trading at the time of such issuance.

          9. Notices. Any notice required to be given or delivered to the Corporation under the
terms of this Agreement shall be in writing and addressed to the Corporation at its principal
corporate offices. Any notice required to be given or delivered to Participant shall be in writing
and addressed to Participant at the address indicated below Participant’s signature line on this
Agreement. All notices shall be deemed effective upon personal delivery or upon deposit in the
U.S. mail, postage prepaid and properly addressed to the party to be notified.

          10. Successors and Assigns. Except to the extent otherwise provided in this
Agreement, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the
Corporation and its successors and assigns and Participant, Participant’s assigns, the legal
representatives, heirs and legatees of Participant’s estate and any beneficiaries of the Award
designated by Participant.

          11. Governing Law. The interpretation, performance and enforcement of this Agreement
shall be governed by the laws of the State of California without resort to that State’s
conflict-of-laws rules.

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          12. Construction. This Agreement and the Award evidenced hereby are made and granted
pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. This
Agreement shall be construed in conformity with the terms of the Plan.

          13. No Impairment of Rights. Nothing in this Agreement shall interfere with or
otherwise restrict in any way the rights of the Corporation and the Corporation’s stockholders to
remove Participant from the Board at any time in accordance with the provisions of applicable law.

          IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first
indicated above.

	 	 	 	 	 
	 	 	SANDISK CORPORATION
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	 
	 
	 	 	 	 
	

	 	Title:	 	 
	

	 	 	 	 
	 
	 	 	 	 
	 	 	PARTICIPANT
	 
	 	 	 	 
	

	 	Signature:	 	 
	

	 	 	 	 
	 
	 	 	 	 
	

	 	Address:	 	 
	

	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	

	 	 	 	 

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APPENDIX A

DEFINITIONS

          The following definitions shall be in effect under the Agreement:

          A. Agreement shall mean this Restricted Stock Unit Issuance Agreement.

          B. Automatic Grant Program shall mean the automatic option grant program for
non-employee Board members in effect under Article Four of the Plan.

          C. Award shall mean the award of restricted stock units made to the
Participant pursuant to the terms of this Agreement.

          D. Award Date shall mean the date the restricted stock units are awarded to
Participant pursuant to the Agreement and shall be the date indicated in Paragraph 1 of the
Agreement.

          E. Board shall mean the Corporation’s Board of Directors.

          F. Change in Control shall mean a change in ownership or control of the
Corporation effected through any of the following transactions:

          (i) a merger or consolidation approved by the Corporation’s stockholders,
unless securities possessing more than fifty percent (50%) of the total combined
voting power of the voting securities of the successor corporation are immediately
thereafter beneficially owned, directly or indirectly and substantially in the same
proportion, by the persons who beneficially owned the Corporation’s outstanding
voting securities immediately prior to such transaction,

          (ii) the sale, transfer or other disposition (including in whole or in part
through one or more licensing arrangements) of all or substantially all of the
Corporation’s assets approved by the Corporation’s stockholders, or

          (iii) the acquisition, directly or indirectly by any person or related group of
persons (other than the Corporation or a person that directly or indirectly
controls, is controlled by, or is under common control with, the Corporation), of
beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of
securities possessing more than fifty percent (50%) of the total combined voting
power of the Corporation’s outstanding securities pursuant to a tender or exchange
offer made directly to the Corporation’s stockholders.

          G. Code shall mean the Internal Revenue Code of 1986, as amended.

A-1

 

          H. Common Stock shall mean shares of the Corporation’s common stock.

          I. Corporation shall mean SanDisk Corporation, a Delaware corporation, and any
successor corporation to all or substantially all of the assets or voting stock of SanDisk
Corporation which shall by appropriate action adopt the Plan.

          J. Employee shall mean an individual who is in the employ of the Corporation
(or any Parent or Subsidiary), subject to the control and direction of the employer entity
as to both the work to be performed and the manner and method of performance.

          K. 1934 Act shall mean the Securities Exchange Act of 1934, as amended from
time to time.

          L. Participant shall mean the non-employee Board member to whom the Award is
made pursuant to the Agreement.

          M. Parent shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations ending with the Corporation, provided each corporation in
the unbroken chain (other than the Corporation) owns, at the time of the determination,
stock possessing fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.

          N. Permanent Disability shall mean the inability of Participant to perform his
or her usual duties as a Board member or other Service status by reason of any medically
determinable physical or mental impairment expected to result in death or to be of
continuous duration of twelve (12) months or more.

          O. Plan shall mean the Corporation’s 2005 Stock Incentive Plan, as amended and
restated.

          P. Service shall mean Participant’s performance of services for the
Corporation (or any Parent or Subsidiary) in the capacity of an Employee, a non-employee
member of the board of directors or a consultant or independent advisor.

          Q. Subsidiary shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations beginning with the Corporation, provided each corporation
(other than the last corporation) in the unbroken chain owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total combined voting
power of all classes of stock in one of the other corporations in such chain.

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SCHEDULE I

VESTING SCHEDULE – INITIAL GRANT OF [___] SHARES

          The Shares subject to the Restricted Stock Units shall vest in a series of four (4) successive
equal annual installments upon Participant’s completion of each year of Service (whether as a
non-employee Board member, Employee or consultant) over the four (4)-year period measured from
____________, 200___.

VESTING SCHEDULE – ANNUAL GRANT OF [___] SHARES

          The Shares subject to the Restricted Stock Units shall vest upon the earlier of (i)
Participant’s completion of the one (1)-year period of Service (whether as a non-employee Board
member, Employee or consultant) measured from ____________, 200___or (ii) Participant’s continuation in
such Service capacity through the day immediately preceding the next annual stockholders meeting
following such measurement date.

A-1exv10w9

 

Exhibit 10.9

EMPLOYEE GRANT

SANDISK CORPORATION

RESTRICTED STOCK AWARD AGREEMENT

          AGREEMENT made this
______day of ____________, by and between SanDisk Corporation, a
Delaware corporation,  

and ________________________.

          The award evidenced by this Agreement has been made pursuant to the Stock Issuance Program in
effect under the Plan

          All capitalized terms in this Agreement shall have the meaning assigned to them in this
Agreement or in the attached Appendix.

     A. SHARE AWARD

          1. Award.
Participant is hereby awarded _________shares of Common Stock, par
value $.001 per share (the “Issued Shares”), in connection with his or her Service.

          2. Par Value Payment. Concurrently with the delivery of this Agreement to the
Corporation, Participant shall pay the Corporation (in cash or by check) the aggregate par value of
the Issued Shares and shall deliver a duly executed blank Assignment Separate from Certificate (in
the form attached hereto as Exhibit I) with respect to the Issued Shares.

          3. Stockholder Rights. Until such time as the Corporation exercises the Repurchase
Right, Participant (or any successor in interest) shall have all the rights of a stockholder
(including voting, dividend and liquidation rights) with respect to the Issued Shares, subject,
however, to the transfer restrictions and escrow requirements of this Agreement .

          4. Escrow. The Corporation shall hold the Issued Shares in escrow until those shares
have vested in accordance with the Vesting Schedule. The Issued Shares which so vest shall be
released to Participant upon his or her satisfaction of all federal, state and local income and
employment taxes which the Corporation is required to withhold in connection with the vesting of
the Issued Shares.

          5. Compliance with Law. Under no circumstances shall shares of Common Stock or other
assets be issued or delivered to Participant pursuant to the provisions of this Agreement unless,
in the opinion of counsel for the Corporation or its successors, there shall have been compliance
with all applicable requirements of applicable securities laws, all applicable listing requirements
of any stock exchange (or the Nasdaq National Market, if applicable) on which the Common Stock is
at the time listed for trading and all other requirements of law or of any regulatory bodies having
jurisdiction over such issuance and delivery.

 

 

     B. TRANSFER RESTRICTIONS

          1. Restriction on Transfer. Except for any Permitted Transfer, Participant shall not
transfer, assign, encumber or otherwise dispose of any of the Issued Shares which are subject to
the Repurchase Right.

          2. Restrictive Legend. The stock certificate for the Issued Shares shall be endorsed
with the following restrictive legend:

     “THE SHARES REPRESENTED BY THIS CERTIFICATE ARE UNVESTED AND SUBJECT TO CERTAIN
REPURCHASE RIGHTS GRANTED TO THE CORPORATION AND ACCORDINGLY MAY NOT BE SOLD,
ASSIGNED, TRANSFERRED, ENCUMBERED, OR IN ANY MANNER DISPOSED OF EXCEPT IN CONFORMITY
WITH THE TERMS OF A WRITTEN AGREEMENT DATED ____________, 200___BETWEEN THE
CORPORATION AND THE REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST
TO THE SHARES). A COPY OF SUCH AGREEMENT IS MAINTAINED AT THE CORPORATION’S
PRINCIPAL CORPORATE OFFICES.”

          3. Transferee Obligations. Each person (other than the Corporation) to whom the
Issued Shares are transferred by means of a Permitted Transfer must, as a condition precedent to
the validity of such transfer, acknowledge in writing to the Corporation that such person is bound
by the provisions of this Agreement and that the transferred shares are subject to the Repurchase
Right to the same extent such shares would be so subject if retained by Participant.

     C. REPURCHASE RIGHT

          1. Grant. The Corporation is hereby granted the right (the “Repurchase Right”),
exercisable at any time during the ninety (90)-day period following the date Participant ceases
Service for any reason, to repurchase at the Repurchase Price any or all of the Issued Shares in
which Participant is not, at the time of his or her cessation of Service, vested in accordance with
the Vesting Schedule set forth in attached Schedule I or the special vesting acceleration
provisions of Paragraph C.5 of this Agreement (such shares to be hereinafter referred to as the
“Unvested Shares”).

          2. Exercise of the Repurchase Right. The Repurchase Right shall be exercisable by
written notice delivered to each Owner of the Unvested Shares prior to the expiration of the ninety
(90)-day exercise period. The notice shall indicate the number of Unvested Shares to be
repurchased and the date on which the repurchase is to be effected, such date to be not more than
thirty (30) days after the date of such notice. The certificates representing the Unvested Shares
to be repurchased shall be delivered to the Corporation on the closing date specified for the
repurchase. Concurrently with the receipt of such stock certificates, the Corporation shall pay to
Owner, in cash or by check, an amount equal to the Repurchase Price for the Unvested Shares to be
repurchased from Owner.

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          3. Termination of the Repurchase Right. The Repurchase Right shall terminate with
respect to any Unvested Shares for which it is not timely exercised under Paragraph C.2. In
addition, the Repurchase Right shall terminate and cease to be exercisable with respect to any and
all Issued Shares in which Participant vests in accordance with the Vesting Schedule set forth in
attached Schedule I or the special vesting acceleration provisions of Paragraph C.5.

          4. Recapitalization. Any new, substituted or additional securities or other property
(including cash paid other than as a regular cash dividend) which is by reason of any
Recapitalization distributed with respect to the Issued Shares shall be immediately subject to the
Repurchase Right and any escrow requirements hereunder, but only to the extent the Issued Shares
are at the time covered by such right or escrow requirements. Appropriate adjustments to reflect
such distribution shall be made to the number and/or class of securities subject to this Agreement
and to the Repurchase Price per share to be paid upon the exercise of the Repurchase Right in order
to reflect the effect of any such Recapitalization upon the Corporation’s capital structure;
provided, however, that the aggregate Repurchase Price shall remain the same.

          5. Change in Control.

               (a) The Repurchase Right shall automatically terminate in its entirety, and all the Issued
Shares shall vest in full immediately prior to the consummation of any Change in Control, except to
the extent the Repurchase Right is to be assigned to the successor corporation in such Change in
Control or otherwise continued in full force and effect pursuant to the terms of the Change in
Control transaction.

               (i) To the extent the Repurchase Right remains in effect following a Change in Control, such
right shall apply to any new securities or other property (including any cash payments) received in
exchange for the Issued Shares in consummation of the Change in Control, but only to the extent the
Issued Shares are at the time covered by such right. Appropriate adjustments shall be made to the
Repurchase Price per share payable upon exercise of the Repurchase Right to reflect the effect (if
any) of the Change in Control upon the Corporation’s capital structure; provided, however,
that the aggregate Repurchase Price shall remain the same. The new securities or other property
(including any cash payments) issued or distributed with respect to the Issued Shares in
consummation of the Change in Control shall be immediately deposited in escrow with the Corporation
(or the successor entity) and shall not be released from escrow until Participant vests in such
securities or other property in accordance with the same Vesting Schedule in effect for the Issued
Shares.

     D. SPECIAL TAX ELECTION

          1. Section 83(b) Election. Under Code Section 83, the excess of the fair market value
of the Issued Shares on the date any forfeiture restrictions applicable to such shares lapse over
the aggregate par value paid for such shares will be reportable as ordinary income on the lapse
date. For this purpose, the term “forfeiture restrictions” includes the right of the Corporation
to repurchase the Issued Shares pursuant to the Repurchase Right. Participant may elect under Code
Section 83(b) to be taxed at the time the Issued Shares are acquired, rather than

3

 

when and as such Issued Shares cease to be subject to such forfeiture restrictions. Such
election must be filed with the Internal Revenue Service within thirty (30) days after the date of
this Agreement. THE FORM FOR MAKING THIS ELECTION IS ATTACHED AS EXHIBIT II HERETO. PARTICIPANT
UNDERSTANDS THAT FAILURE TO MAKE THIS FILING WITHIN THE APPLICABLE THIRTY (30)-DAY PERIOD WILL
RESULT IN THE RECOGNITION OF ORDINARY INCOME AS THE FORFEITURE RESTRICTIONS LAPSE.

          2. FILING RESPONSIBILITY. PARTICIPANT ACKNOWLEDGES THAT IT IS PARTICIPANT’S SOLE
RESPONSIBILITY, AND NOT THE CORPORATION’S, TO FILE A TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN
IF PARTICIPANT REQUESTS THE CORPORATION OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HIS OR HER
BEHALF.

     E. GENERAL PROVISIONS

          1. Assignment. The Corporation may assign the Repurchase Right to any person or
entity selected by the Board, including (without limitation) one or more stockholders of the
Corporation.

          2. At Will Employment. Nothing in this Agreement or in the Plan shall confer upon
Participant any right to continue in Service for any period of specific duration or interfere with
or otherwise restrict in any way the rights of the Corporation (or any Parent or Subsidiary
employing or retaining Participant) or of Participant, which rights are hereby expressly reserved
by each, to terminate Participant’s Service at any time for any reason, with or without cause.

          3. Notices. Any notice required to be given under this Agreement shall be in writing
and shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, registered
or certified, postage prepaid and properly addressed to the party entitled to such notice at the
address indicated below such party’s signature line on this Agreement or at such other address as
such party may designate by ten (10) days advance written notice under this paragraph to all other
parties to this Agreement.

          4. No Waiver. The failure of the Corporation in any instance to exercise the
Repurchase Right shall not constitute a waiver of any other repurchase rights that may subsequently
arise under the provisions of this Agreement or any other agreement between the Corporation and
Participant. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver
of any other or subsequent breach or condition, whether of like or different nature.

          5. Cancellation of Shares. If the Corporation shall make available, at the time and
place and in the amount and form provided in this Agreement, the consideration for the Issued
Shares to be repurchased in accordance with the provisions of this Agreement, then from and after
such time, the person from whom such shares are to be repurchased shall no longer have any rights
as a holder of such shares (other than the right to receive payment of such

4

 

consideration in accordance with this Agreement). Such shares shall be deemed purchased in
accordance with the applicable provisions hereof, and the Corporation shall be deemed the owner and
holder of such shares, whether or not the certificates therefor have been delivered as required by
this Agreement.

          6. Participant Undertaking. Participant hereby agrees to take whatever additional
action and execute whatever additional documents the Corporation may deem necessary or advisable in
order to carry out or effect one or more of the obligations or restrictions imposed on either
Participant or the Issued Shares pursuant to the provisions of this Agreement.

          7. Agreement is Entire Contract. This Agreement constitutes the entire contract
between the parties hereto with regard to the subject matter hereof. This Agreement is made
pursuant to the provisions of the Plan and shall in all respects be construed in conformity with
the terms of the Plan.

          8. Governing Law. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of California without resort to that State’s conflict-of-laws rules.

          9. Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed to be an original, but all of which together shall constitute one and the same
instrument.

          10. Successors and Assigns. The provisions of this Agreement shall inure to the
benefit of, and be binding upon, the Corporation and its successors and assigns and upon
Participant, Participant’s assigns and the legal representatives, heirs and legatees of
Participant’s estate, whether or not any such person shall have become a party to this Agreement
and have agreed in writing to join herein and be bound by the terms hereof.

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          IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first
indicated above.

	 	 	 	 	 
	 	 	SANDISK CORPORATION
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	 
	 
	 	 	 	 
	

	 	Title:	 	 
	

	 	 	 	 
	 
	 	 	 	 
	

	 	Address:
	 	140 Caspian Court,

Sunnyvale, California 94089
	 
	 	 	 	 
	 	 	PARTICIPANT
	 
	 	 	 	 
	

	 	Signature	 	 
	

	 	 	 	 
	 
	 	 	 	 
	

	 	Address:	 	 
	

	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	

	 	 	 	 

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EXHIBIT I

ASSIGNMENT SEPARATE FROM CERTIFICATE

          FOR VALUE RECEIVED                                          hereby sell(s), assign(s) and transfer(s) unto
SanDisk Corporation (the “Corporation”),                                          (_________) shares of the Common
Stock of the Corporation standing in his or her name on the books of the Corporation represented by
Certificate No. ____________herewith and do(es) hereby irrevocably constitute and appoint
                                         Attorney to transfer the said stock on the books of the Corporation
with full power of substitution in the premises.

Dated: _________________, _____.

Signature                                                            

Instruction: Please do not fill in any blanks other than the signature line. Please sign exactly
as you would like your name to appear on the issued stock certificate. The purpose of this
assignment is to enable the Corporation to exercise the Repurchase Right without requiring
additional signatures on the part of Participant.

 

 

EXHIBIT II

SECTION 83(b) TAX ELECTION

This statement is being made under Section 83(b) of the Internal Revenue Code, pursuant to Treas.
Reg. Section 1.83-2.

	(1)  	The taxpayer who performed the services is:
	 
	   	Name:
	 
	   	Address:
	 
	   	Taxpayer Ident. No.:
	 
	(2)  	The property with respect to which the election is being made is                                         shares of the
common stock of SanDisk Corporation
	 
	(3)  	The property was issued on                                         , 200___.
	 
	(4)  	The taxable year in which the election is being made is the calendar year 200___.
	 
	(5)  	The property is subject to a repurchase right pursuant to which the issuer has the right to
acquire the property at the par value paid per share, if for any reason taxpayer’s service
with the issuer terminates. The issuer’s repurchase right will lapse as follows:
                                                            .
	 
	(6)  	The fair market value at the time of transfer (determined without regard to any restriction
other than a restriction which by its terms will never lapse) is
$_________ per share.
	 
	(7)  	The amount paid for such property is $0.001 per share.
	 
	(8)  	A copy of this statement was furnished to SanDisk Corporation for whom taxpayer rendered the
services underlying the transfer of property.
	 
	(9)  	This statement is executed on                                         , 200___.

	 	 	 
	 

	 	 
	Spouse (if any)

	 	Taxpayer

This election must be filed with the Internal Revenue Service Center with which taxpayer files
his or her Federal income tax returns and must be made within thirty (30) days after the execution
date of the Stock Issuance Agreement. This filing should be made by registered or certified mail,
return receipt requested. Participant must retain two (2) copies of the completed form for filing
with his or her Federal and state tax returns for the current tax year and an additional copy for
his or her records.

 

 

APPENDIX

          The following definitions shall be in effect under the Agreement:

     A. Agreement shall mean this Restricted Stock Award Agreement.

     B. Board shall mean the Corporation’s Board of Directors.

     C. Change in Control shall mean a change in ownership or control of the Corporation
effected through any of the following transactions:

          (i) a merger, consolidation or other reorganization approved by the
Corporation’s stockholders, unless securities representing more than fifty
percent (50%) of the total combined voting power of the voting securities of the
successor corporation are immediately thereafter beneficially owned, directly or
indirectly and in substantially the same proportion, by the persons who beneficially
owned the Corporation’s outstanding voting securities immediately prior to such
transaction, or

          (ii) a stockholder-approved sale, transfer or other disposition (including in
whole or in part through one or more licensing arrangements) of all or substantially
all of the Corporation’s assets, or

          (iii) the closing of any transaction or series of related transactions pursuant
to which any person or any group of persons comprising a “group” within the meaning
of Rule 13d-5(b)(1) of the 1934 Act (other than the Corporation or a person that,
prior to such transaction or series of related transactions, directly or indirectly
controls, is controlled by or is under common control with, the Corporation) becomes
directly or indirectly the beneficial owner (within the meaning of Rule 13d-3 of the
1934 Act) of securities possessing (or convertible into or exercisable for
securities possessing) more than fifty percent (50%) of the total combined voting
power of the Corporation’s securities (as measured in terms of the power to vote
with respect to the election of Board members) outstanding immediately after the
consummation of such transaction or series of related transactions, whether such
transaction involves a direct issuance from the Corporation or the acquisition of
outstanding securities held by one or more of the Corporation’s existing
stockholders.

     D. Common Stock shall mean shares of the Corporation’s common stock, par value $.001
per share.

     E. Code shall mean the Internal Revenue Code of 1986, as amended.

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     F. Corporation shall mean SanDisk Corporation, a Delaware corporation, and any
successor corporation to all or substantially all of the assets or voting stock of SanDisk
Corporation.

     G. Employee shall mean an individual who is in the employ of the Corporation (or any
Parent or Subsidiary, whether now existing or subsequently established), subject to the control and
direction of the employer entity as to both the work to be performed and the manner and method of
performance.

     H. Issued Shares shall have the meaning assigned to such term in Paragraph A.1.

     I. Owner shall mean Participant and all subsequent holders of the Issued Shares who
derive their chain of ownership through a Permitted Transfer from Participant.

     J. Parent shall mean any corporation (other than the Corporation) in an unbroken chain
of corporations ending with the Corporation, provided each corporation in the unbroken chain (other
than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%)
or more of the total combined voting power of all classes of stock in one of the other corporations
in such chain.

     K. Participant shall mean the individual to whom the Issued Shares are awarded under
the Stock Issuance Grant Program.

     L. Permitted Transfer shall mean (i) a gratuitous transfer of the Issued Shares,
provided and only if Participant obtains the Corporation’s prior written consent to such
transfer or (ii) a transfer of title to the Issued Shares effected pursuant to Participant’s will
or the laws of inheritance following Participant’s death.

     M. Plan shall mean the Corporation’s 2005 Stock Incentive Plan.

     N. Plan Administrator shall mean the particular entity, whether the Compensation
Committee, the Board or any secondary Board committee, which is authorized to administer the Stock
Issuance Program with respect to one or more classes of eligible persons, to the extent such entity
is carrying out its administrative functions under that program with respect to the persons under
its jurisdiction.

     O. Recapitalization shall mean any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the Corporation’s outstanding
Common Stock as a class without the Corporation’s receipt of consideration.

     P. Repurchase Price shall mean the par value of $.001 which the Participant paid per
Issued Share.

     Q. Repurchase Right shall mean the right granted to the Corporation in accordance with
Article C.

A-2

 

     R. Service shall mean the Participant’s performance of services for the Corporation (or
any Parent or Subsidiary, whether now existing or subsequently established) in the capacity of an
Employee, a non-employee member of the board of directors or a consultant or independent advisor.
For purposes of this Agreement, the Participant shall be deemed to cease Service immediately upon
the occurrence of the either of the following events: (i) the Participant no longer performs
services in any of the foregoing capacities for the Corporation or any Parent or Subsidiary or (ii)
the entity for which the Participant is performing such services ceases to remain a Parent or
Subsidiary of the Corporation, even though the Participant may subsequently continue to perform
services for that entity. Service shall not be deemed to cease during a period of military leave,
sick leave or other personal leave approved by the Corporation; provided, however, that no
Service credit shall be given for vesting purposes for any period the Participant is on a leave of
absence, except to the extent otherwise required by law or expressly authorized by the Plan
Administrator or by the Corporation’s written policy on leaves of absence..

     S. Stock Issuance Program shall mean the direct stock issuance program in effect under
Article Three of the Plan.

     T. Subsidiary shall mean any corporation (other than the Corporation) in an unbroken
chain of corporations beginning with the Corporation, provided each corporation (other than the
last corporation) in the unbroken chain owns, at the time of the determination, stock possessing
fifty percent (50%) or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.

     U. Vesting Schedule shall mean the vesting schedule specified in attached Schedule I,
pursuant to which the Issued Shares are to vest in one or more installments over Participant’s
period of Board service.

     V. Unvested Shares shall have the meaning assigned to such term in Paragraph C.1.

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SCHEDULE I

VESTING SCHEDULE

          The Issued Shares shall initially be unvested and subject to repurchase by the Corporation, at
the Repurchase Price per share, upon Participant’s cessation of Service (other than by reason of
death or Permanent Disability) prior to vesting in the Issued Shares. Participant shall acquire a
vested interest in, and the Corporation’s repurchase right will accordingly lapse with respect to,
the Issued Shares in a series of installments as follows:

To Be Determined by the Plan Administrator

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