Apple 2008 Annual Report Download - page 94

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Table of Contents
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’s internal control over financial reporting during the fourth quarter of fiscal 2008, which were identified
in connection with management’s evaluation required by paragraph (d) of rules 13a-15 and 15d-15 under the Exchange Act, that have materially
affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
Item 9B. Other Information
On November 3, 2008, Tony Fadell, Senior Vice President, iPod Division of the Company became Special Advisor to the Company’s Chief
Executive Officer. In this new position, Mr. Fadell no longer will be an executive officer of the Company. In connection therewith, Mr. Fadell
and the Company have entered into a Transition Agreement and a Settlement Agreement and Release (the “Transition Agreement” and the
“Settlement Agreement,” respectively), under which Mr. Fadell will receive a salary of three hundred thousand dollars annually, and will be
entitled to bonus and other health and welfare benefits generally available to other senior managers for the duration of the Transition Agreement,
which remains in effect until March 24, 2010. The Transition Agreement also provides for the cancellation of outstanding and unvested 155,000
restricted stock units held by Mr. Fadell. Upon approval by the Compensation Committee of the Company’s Board of Directors, Mr. Fadell will
be granted 77,500 restricted stock units that will vest in full on March 24, 2010, subject to his continued employment with the Company through
the vesting date and further subject to accelerated vesting if the Company terminates his employment without cause. The restricted stock units
are payable upon vesting in shares of the Company’s common stock on a one-for-one basis. The Settlement Agreement includes Mr. Fadell’s
release of claims against the Company and agreement not to solicit the Company’s employees for one year following the termination of his
employment.
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