Apple 1998 Annual Report Download - page 81

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In December 1997, the Compensation Committee also reviewed the employees' outstanding options and determined that many employees of
the Company held options at exercise prices that limited their effectiveness as a tool for employee retention and as a long-term incentive. To
address this problem, the Compensation Committee consulted with an independent benefits consultant and, after considering various methods
of dealing with this problem, approved the stock option exchange program (the "Exchange Program"). Under the Exchange Program, current
employees of the Company were permitted to exchange all of their options with an exercise price of greater than $13.6875 on a one-for-one
basis for new stock options with an exercise price of $13.6875, the fair market value of the Common Stock on December 19, 1997, and a new
four year vesting schedule. Six executive officers elected to participate in the Exchange Program. The terms of the Exchange Program are
described in the section entitled "Stock Option Exchange Program".
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Mr. Jobs, the Company's interim Chief Executive Officer, did not receive any compensation for the services he performed for the Company in
fiscal year 1998.
SECTION 162(M)
The Company intends that options granted under the Company's stock option plans be deductible by the Company under Section 162(m) of the
Internal Revenue Code of 1986, as amended.
MEMBERS OF THE COMPENSATION COMMITTEE
Edgar S. Woolard, Jr., Chairman Gareth C.C. Chang
77