Apple 2002 Annual Report Download - page 85

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If an Option or SAR is granted to an individual who is a consultant to the Company or any Subsidiary or Affiliate, all references in the
Plan to "Employee" shall be deemed to include the term "consultant" and all references in the Plan to "employment," "Continuous Status as an
Employee" and "termination of employment" shall be deemed to refer to the individualss consultancy or status as a consultant.
6. Term of Plan. The Plan shall become effective upon its adoption by the Board. It shall continue in effect for a term of ten years
unless sooner terminated under Section 14 of the Plan.
7. Term of Option. The term of each Option shall be ten (10) years from the date of grant thereof or such shorter term as may be
provided in the Option agreement.
8. Exercise Price and Consideration.
(a) Exercise Price. The per Share exercise price for the Shares issuable pursuant to an Option shall be such price as is
determined by the Administrator, but shall in no event be less than 100% of the Fair Market Value of Common Stock, determined as of
the date of grant of the Option. In the event that the Administrator shall reduce the exercise price, the exercise price shall be no less than
100% of the Fair Market Value as of the date of that reduction.
(b) Method of Payment. The consideration to be paid for the Shares to be issued upon exercise of an Option, including the
method of payment, shall be determined by the Administrator and may consist of (i) cash, (ii) check, (iii) promissory note, (iv) other
Shares which have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised, (v) delivery of a properly executed exercise notice together with irrevocable instructions to a broker to
promptly deliver to the Company the amount of sale or loan proceeds required to pay the exercise price, or (vi) any combination of the
foregoing methods of payment and/or any other consideration or method of payment as shall be permitted under applicable corporate
law.
9. Stock Appreciation Rights.
(a) Granted in Connection with Options.
At the sole discretion of the Administrator, SARs may be granted in connection with
all or any part of an Option, either concurrently with the grant
14
of the Option or at any time thereafter during the term of the Option. The following provisions apply to SARs that are granted in
connection with Options:
(i) The SAR shall entitle the Optionee to exercise the SAR by surrendering to the Company unexercised a portion of the
related Option. The Optionee shall receive in exchange from the Company an amount equal to the excess of (x) the Fair Market
Value on the date of exercise of the SAR of the Common Stock covered by the surrendered portion of the related Option over
(y) the exercise price of the Common Stock covered by the surrendered portion of the related Option. Notwithstanding the
foregoing, the Administrator may place limits on the amount that may be paid upon exercise of an SAR; provided, however, that
such limit shall not restrict the exercisability of the related Option.
(ii) When an SAR is exercised, the related Option, to the extent surrendered, shall no longer be exercisable.
(iii) An SAR shall be exercisable only when and to the extent that the related Option is exercisable and shall expire no later
than the date on which the related Option expires.
(iv) An SAR may only be exercised at a time when the Fair Market Value of the Common Stock covered by the related
Option exceeds the exercise price of the Common Stock covered by the related Option.
(b) Independent SARs. At the sole discretion of the Administrator, SARs may be granted without related Options. The
following provisions apply to SARs that are not granted in connection with Options:
(i) The SAR shall entitle the Optionee, by exercising the SAR, to receive from the Company an amount equal to the excess
of (x) the Fair Market Value of the Common Stock covered by exercised portion of the SAR, as of the date of such exercise,
over (y) the Fair Market Value of the Common Stock covered by the exercised portion of the SAR, as of the date on which the
SAR was granted; provided, however, that the Administrator may place limits on the amount that may be paid upon exercise of
an SAR.
(ii) SARs shall be exercisable, in whole or in part, at such times as the Administrator shall specify in the Optionee's SAR
agreement.