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SanDisk thanks a founder for the memories …

At year’s end, Eli Harari is stepping down from a long stint as chairman and chief executive of SanDisk (SNDK), the company he co-founded and which makes those little cards that store your digital photos. So perhaps it’s no surprise that the company is thanking Harari with more than a pretty speech or two.

Harari will stick around for two years as a consultant to SanDisk — not an uncommon arrangement these days, but he’ll only get $50,000 plus expenses, according to the 8-K the company filed yesterday. That looks like a bargain to our jaded eyes: Not bad for part-time work, of course, but still well below what many companies are paying retired officers.

The rest of his retirement send-off should make up for it. For one thing, he’s getting a $3 million lump sum in return for giving the company “any intellectual property relating to the Registrant’s business that he creates” as a consultant, plus a non-competition and non-solicitation agreement lasting two years beyond his consulting gig.

Moreover, any restricted stock units and options that he holds will continue to vest while he’s a consultant; performance-based awards expire on Dec. 31 this year.

That doesn’t cover all of his equity awards. But never fear: He’ll get those as well. On Dec. 31, 2012 — or sooner, if SanDisk happens to be acquired or taken over — any remaining options and restricted stock units will vest as well. That’s not cheap for SanDisk: The company says it expects to record a charge of $11 million to $13 million in the year ended Jan. 2, 2011, “subject to future market conditions.”

Finally, Harari and his spouse are getting lifetime health benefits from the company — in the form of a lump-sum payment of $476,000 on Dec. 31 this year. SanDisk plans to pay Harari’s taxes on that amount as well, bringing the company’s cost for the benefit to about $950,000.

At the same time, we can’t help but notice that SanDisk doesn’t provide special retirement benefits for top officers — they participate in the 401(k) like everyone else at the company, with the same federal limits on contributions.

All in all, the sendoff should make Harari’s retirement years fairly comfortable, together with the 5 million or so shares he owned as of the last proxy statement. Then again, he did take the company from zero to nearly $10 billion in 22 years. Presumably shareholders think that’s worth more than a handshake.

Image source: Uwe Hermann via Flickr

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