1998 Executive Officer Stock Plan

EXHIBIT 10.A.51


APPLE COMPUTER, INC.
1998 EXECUTIVE OFFICER STOCK PLAN
(AS AMENDED THROUGH 5/3/00)


1. PURPOSES OF THE PLAN. The purposes of this Stock Plan are:


to attract and retain the best available personnel for positions of
substantial responsibility;


to provide additional incentive to the Chairman and/or Executive Officers
and other key employees; and


to promote the success of the Company's business.


Options granted under the Plan may be Incentive Stock Options (as defined under Section 422 of the Code) or Nonstatutory Stock Options, as determined by the Administrator at the time of grant. Stock appreciation rights ("SARs") may be granted under the Plan in connection with Options or independently of Options. Stock Purchase Rights may also be granted under the Plan.


2. DEFINITIONS. As used herein, the following definitions shall apply:


(a) "ADMINISTRATOR" means the Board or any of its Committees as shall
be administering the Plan, in accordance with Section 4 of the Plan.


(b) "AGREEMENT" means an agreement between the Company and an Optionee
evidencing the terms and conditions of an individual Option, SAR or Stock
Purchase Right grant. The Agreement is subject to the terms and conditions
of the Plan.


(c) "APPLICABLE LAWS" means the requirements relating to the
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws
of any foreign country or jurisdiction where Options, SARs or Stock Purchase
Rights are, or will be, granted under the Plan.


(d) "BOARD" means the Board of Directors of the Company.


(e) "CHAIRMAN" means the Chairman of the Board.


(f) "CODE" means the Internal Revenue Code of 1986, as amended.


(g) "COMMITTEE" means a committee of Directors appointed by the Board
in accordance with Section 4 of the Plan.


(h) "COMMON STOCK" means the common stock of the Company.


(i) "COMPANY" means Apple Computer, Inc., a California corporation.


(j) "CONTINUOUS STATUS AS CHAIRMAN" unless determined otherwise by the
Administrator, means the absence of any interruption or termination as
Chairman of the Board with the Company. Continuous Status as Chairman shall
not be considered interrupted in the case of medical leave, military leave,
family leave, or any other leave of absence approved by the Administrator,
provided, in each case, that such leave does not result in termination as
Chairman with the Company. Neither service as a Director nor payment of a
director's fee by the Company shall be sufficient to constitute status as
"Chairman" by the Company.


(k) "CONTINUOUS STATUS AS AN EMPLOYEE" means the absence of any
interruption or termination of the employment relationship with the Company
or any Subsidiary. Continuous Status as an Employee shall not be


considered interrupted in the case of (i) medical leave, military leave,
family leave, or any other leave of absence approved by the Administrator,
provided, in each case, that such leave does not result in termination of
the employment relationship with the Company or any Subsidiary, as the
case may be, under the terms of the respective Company policy for such
leave; however, vesting may be tolled while an employee is on an approved
leave of absence under the terms of the respective Company policy for such
leave; or (ii) in the case of transfers between locations of the Company
or between the Company, its Subsidiaries, or its successor; For purposes
of Incentive Stock Options, no such leave may exceed ninety days, unless
reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved
by the Company is not so guaranteed, on the 91st day of such leave any
Incentive Stock Option held by the Optionee shall cease to be treated as
an Incentive Stock Option and shall be treated for tax purposes as a
Nonstatutory Stock Option. Neither service as a Chairman nor as a Director
nor payment of a director's fee by the Company shall be sufficient to
constitute 'employment' by the Company.


(l) "Director" means a member of the Board.


(m) "Employee" means any person employed by the Company or any Parent or
Subsidiary of the Company subject to (k) above.


(n) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.


(o) "Executive Officer" means any person who is an officer of the
Company within the meaning of Section 16 of the Exchange Act and the rules
and regulations promulgated thereunder.


(p) "Fair Market Value" means, as of any date, the value of Common Stock
determined as follows:


(i) If the Common Stock is listed on any established stock exchange
or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market,
its Fair Market Value shall be the closing sales price for such stock (or
the closing bid, if no sales were reported) as quoted on such exchange or
system, on the date of determination or, if the date of determination is
not a trading day, the immediately preceding trading day, as reported in
THE WALL STREET JOURNAL or such other source as the Administrator deems
reliable;


(ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market
Value of a Share of Common Stock shall be the mean between the high bid
and low asked prices for the Common Stock on the date of determination
or, if there are no quoted prices on the date of determination, on the
last day on which there are quoted prices prior to the date of
determination, as reported in THE WALL STREET JOURNAL or such other
source as the Administrator deems reliable; or


(iii) In the absence of an established market for the Common Stock,
the Fair Market Value shall be determined in good faith by the
Administrator.


(q) "Incentive Stock Option"means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder and is expressly designated by the
Administrator at the time of grant as an incentive stock option.


(r) "Nonstatutory Stock Option" means an Option not intended to qualify
as an Incentive Stock Option.


(s) "Option" means a stock option granted pursuant to the Plan.


(t) "Optioned Stock" means the Common Stock subject to an Option, SAR or
Stock Purchase Right.


(u) "Optionee" means the holder of an outstanding Option, SAR or Stock
Purchase Right.


(v) "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.


(w) "Plan" means this 1998 Executive Officer Stock Plan.


(x) "Restricted Stock" means shares of Common Stock acquired pursuant to
a grant of Stock Purchase Rights under Section 12 of the Plan.


(y) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor
to Rule 16b-3, as in effect when discretion is being exercised with respect
to the Plan.


(z) "SAR" means a stock appreciation right granted pursuant to Section
10 below.


(aa) "Section 16(b)" means Section 16(b) of the Exchange Act.


(bb) "Share" means a share of the Common Stock, as adjusted in accordance
with Section 15 of the Plan.


(cc) "Stock Purchase Right" means the right to purchase Common Stock
pursuant to Section 12 of the Plan, as evidenced by an Agreement.


(dd) "Subsidiary" means a 'subsidiary corporation', whether now or
hereafter existing, as defined in Section 424(f) of the Code.


3. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Section 15 of the Plan, the maximum aggregate number of Shares which may be optioned and sold under the Plan or for which SARs or Stock Purchase Rights may be granted and exercised is 19,000,000 Shares. The Shares may be authorized, but unissued, or reacquired Common Stock.


In the discretion of the Administrator, any or all of the Shares authorized under the Plan may be subject to SARs issued pursuant to the Plan.


If an Option, SAR or Stock Purchase Right issued under the Plan should expire or become unexercisable for any reason without having been exercised in full, the unpurchased Shares which were subject thereto shall become available for other Options, SARs or Stock Purchase Rights under this Plan (unless the Plan has terminated); however, should the Company reacquire Shares which were issued pursuant to the exercise of an Option or SAR, such Shares shall not become available for future grant under the Plan. If Shares of Restricted Stock are repurchased by the Company at their original purchase price, such shares shall become available for future grant under the Plan.


4. ADMINISTRATION OF THE PLAN.


(a) PROCEDURE.


(i) MULTIPLE ADMINISTRATIVE BODIES. If permitted by Rule 16b-3
promulgated under the Exchange Act or any successor rule thereto, as in
effect at the time that discretion is being exercised with respect to the
Plan, and by the legal requirements of the Applicable Laws relating to
the administration of stock plans such as the Plan, if any, the Plan may
(but need not) be administered by different administrative bodies with
respect to (A) Directors who are not Employees, (B) Directors who are
Employees, (C) Officers who are not Directors and (D) Employees who are
neither Directors nor Officers.


(ii) SECTION 162(m). To the extent that the Administrator determines
it to be desirable to qualify Options or SARs granted hereunder as
"performance-based compensation" within the meaning of Section 162(m) of
the Code, the Plan shall be administered by a Committee of two or more
"outside directors" within the meaning of Section 162(m) of the Code.


(iii) RULE 16b-3. To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions contemplated
hereunder shall be structured to satisfy the requirements for exemption
under Rule 16b-3.


(iv) OTHER ADMINISTRATION. Other than as provided above, the Plan
shall be administered by (A) the Board or (B) a Committee, which
committee shall be constituted to satisfy Applicable Laws.


(b) POWERS OF THE ADMINISTRATOR. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties
delegated by the Board to such Committee, the Administrator shall have the
authority, in its discretion:


(i) to determine the Fair Market Value;


(ii) to select the person(s) to whom Options, SARs and Stock Purchase
Rights may be granted hereunder;


(iii) to determine the number of shares of Common Stock to be covered
by each Option, SAR or Stock Purchase Right granted hereunder;


(iv) to approve forms of agreement for use under the Plan;


(v) to determine the terms and conditions, not inconsistent with the
terms of the Plan, of any Option, SAR or Stock Purchase Right granted
hereunder. Such terms and conditions include, but are not limited to, the
exercise price, the date of grant, the time or times when Options, SARs
or Stock Purchase Rights may be exercised (which may be based on
performance criteria), any vesting acceleration or waiver of forfeiture
restrictions, and any restriction or limitation regarding any Option, SAR
or Stock Purchase Right or the shares of Common Stock relating thereto,
based in each case on such factors as the Administrator, in its sole
discretion, shall determine;


(vi) to reduce the exercise price of any Option, SAR or Stock
Purchase Right to the then current Fair Market Value if the Fair Market
Value of the Common Stock covered by such Option, SAR or Stock Purchase
Right shall have declined since the date the Option, SAR or Stock
Purchase Right was granted;


(vii) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan;


(viii) to prescribe, amend and rescind rules and regulations relating
to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment
under foreign tax laws;


(ix) to modify or amend each Option, SAR or Stock Purchase Right
(subject to Section 17(c) of the Plan), including the discretionary
authority to extend the post-termination exercisability period of Options
longer than is otherwise provided for in the Plan;


(x) to allow Optionees to satisfy withholding tax obligations by
electing to have the Company withhold from the Shares to be issued upon
exercise of an Option, SAR or Stock Purchase Right that number of Shares
having a Fair Market Value equal to the amount required to be withheld.
The Fair Market Value of the Shares to be withheld shall be determined on
the date that the amount of tax to be withheld is to be determined. All
elections by an Optionee to have Shares withheld for this purpose shall
be made in such form and under such conditions as the Administrator may
deem necessary or advisable;


(xi) to authorize any person to execute on behalf of the Company any
instrument required to effect the grant of an Option, SAR or Stock
Purchase Right previously granted by the Administrator; and


(xii) to make all other determinations deemed necessary or advisable
for administering the Plan.


(c) EFFECT OF ADMINISTRATOR'S DECISION. The Administrator's decisions,
determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options, SARs or Stock Purchase Rights.


5. ELIGIBILITY. Nonstatutory Stock Options, SARs and Stock Purchase Rights may be granted to the Chairman, Executive Officers and other key employees or to such other individuals as determined by the Administrator whom the Company has offered a position of Chairman or Executive Officer. Incentive Stock Options may be granted only to Executive Officers and other key employees.


6. LIMITATIONS.


(a) Each Option shall be designated in the Agreement as either an
Incentive Stock Option or a Nonstatutory Stock Option. However, ...