Apple 2000 Annual Report Download - page 56

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 7--EMPLOYEE BENEFIT PLANS
1998 EXECUTIVE OFFICER STOCK PLAN
The Company has in effect a 1998 Executive Officer Stock Plan (the 1998 Plan), which replaced the 1990 Stock Option Plan terminated in
April 1998, the 1981 Stock Option Plan terminated in October 1990, and the 1987 Executive Long Term Stock Option Plan terminated in July
1995. Options granted before these plans' termination dates remain outstanding in accordance with their terms. Options may be granted under
the 1998 Plan to the Chairman of the Board of Directors, executive officers of the Company at the level of Senior Vice President and above,
and other key employees. These options generally become exercisable over a period of 4 years, based on continued employment, and generally
expire 10 years after the grant date. The 1998 Plan permits the granting of incentive stock options, nonstatutory stock options, stock
appreciation rights, and stock purchase rights. A total of 38,000,000 shares have been authorized for issuance under the 1998 Plan, of which
7,181,104 shares are reserved for future issuance as of September 30, 2000.
1997 EMPLOYEE STOCK OPTION PLAN
In August 1997, the Company's Board of Directors approved the 1997 Employee Stock Option Plan (the 1997 Plan), for grants of stock options
to employees who are not officers of the Company. Options may be granted under the 1997 Plan to employees at not less than the fair market
value on the date of grant. These options generally become exercisable over a period of 4 years, based on continued employment, and generally
expire 10 years after the grant date. A total of 43,000,000 shares have been authorized for issuance under the 1997 Plan, of which 3,929,356
shares are reserved for future issuance as of September 30, 2000.
1997 DIRECTOR STOCK OPTION PLAN
In August 1997, the Company's Board of Directors approved a Director Stock Option Plan (DSOP), for which directors of the Company are
eligible. Options granted under the DSOP vest in three equal installments, on each of the first through third anniversaries of the date of grant. A
total of 800,000 shares have been authorized for issuance under the DSOP, of which 420,000 shares remain reserved for future issuance.
Supplementally and separate from the DSOP, 60,000 options had been granted in total to two members of the Company's Board of Directors, of
which 30,000 shares remain outstanding as of September 30, 2000.
EMPLOYEE STOCK PURCHASE PLAN
The Company has an employee stock purchase plan (the Purchase Plan), under which substantially all employees may purchase common stock
through payroll deductions at a price equal to 85% of the lower of the fair market values as of the beginning and end of the six-month offering
period. Stock purchases under the Purchase Plan are limited to 10% of an employee's compensation, up to a maximum of $25,000 in any
calendar year. During 2000, 1999, and 1998, 766,000, 1.1 million and 2.2 million shares, respectively, were issued under the Purchase Plan. As
of September 30, 2000, approximately 5.76 million shares were reserved for future issuance under the Purchase Plan.
EMPLOYEE SAVINGS PLAN
The Company has an employee savings plan (the Savings Plan) qualifying as a deferred salary arrangement under Section 401(k) of the
Internal Revenue Code. Under the Savings Plan, participating U.S. employees may defer a portion of their pre-tax earnings, up to the Internal
Revenue Service annual contribution limit ($10,500 for calendar year 2000). The Company matches 50% to 100% of each employee's
contributions, depending on length of service, up to a maximum 6% of the employee's earnings. The Company's
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