{"id":40369,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/retention-agreement-apple-computer-inc-and-fred-d-anderson.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"retention-agreement-apple-computer-inc-and-fred-d-anderson","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/retention-agreement-apple-computer-inc-and-fred-d-anderson.html","title":{"rendered":"Retention Agreement &#8211; Apple Computer Inc. and Fred D. Anderson Jr."},"content":{"rendered":"<pre>                                                              March 4, 1996\nFred D. Anderson, Jr.\n114 Old Chester Road\nEssex Fells, NJ  07021\n\n                     Retention Agreement\n                              \n                              \nDear Fred:\n\n           Apple Computer, Inc., a California corporation  (the 'Company'),\nconsiders  it essential to the best interests of its stockholders  to  take\nreasonable steps to retain key management personnel.  Further, the Board of\nDirectors of the Company (the 'Board') recognizes that the uncertainty  and\nquestions which might arise among management in the context of a change  in\ncontrol  of  the  Company could result in the departure or  distraction  of\nmanagement personnel to the detriment of the Company and its stockholders.\n\n           The  Board  has  determined, therefore, that  appropriate  steps\nshould  be  taken  to reinforce and encourage the continued  attention  and\ndedication   of  members  of  the  management  of  the  Company   and   its\nsubsidiaries,   including  yourself,  to  their  assigned  duties   without\ndistraction  in  the  face of potentially disturbing circumstances  arising\nfrom any possible change in control of the Company.\n\n           In  order to induce you to remain in the employ of the  Company,\nthe  Company  has  determined  to enter into this  letter  agreement  (this\n'Agreement') which addresses the terms and conditions of your employment in\nthe  event of a change in control of the Company.  Capitalized words  which\nare  not otherwise defined herein shall have the meanings assigned to  such\nwords in Section 8 of this Agreement.\n\n           1.    Term of Employment Under the Agreement.  The term of  your\nemployment  under  this Agreement shall commence on the Change  in  Control\nDate  and  shall  continue until the second anniversary of  the  Change  in\nControl Date (the 'Term').\n\n           2.   Employment During the Term.  During the Term, the following\nterms and conditions shall apply to your employment with the Company:\n\n          (a)  Titles; Reporting and Duties.  Your position, titles, nature\nand  status of responsibilities and reporting obligations shall be no  less\nfavorable  to  you  than those that you enjoyed immediately  prior  to  the\nChange in Control Date.\n\n           (b)   Salary  and  Bonus.   Your base salary  and  annual  bonus\nopportunity  may not be reduced, and your base salary shall be periodically\nreviewed and increased in the manner commensurate with increases awarded to\nother similarly situated executives of the Company.\n\n            (c)    Incentive  Compensation.   You  shall  be  eligible   to\nparticipate in each long-term incentive plan or arrangement established  by\nthe  Company for its executive employees, in accordance with the terms  and\nprovisions of such plan or arrangement and at a level consistent  with  the\nCompany's practices applicable to you prior to the Change in Control Date.\n                             48\n\n\n           (d)   Benefits.   You  shall be eligible to participate  in  all\npension, welfare and fringe benefit plans and arrangements that the Company\nprovides  to its executive employees in accordance with the terms  of  such\nplans  and  arrangements, which shall be no less favorable to you,  in  the\naggregate,  than  the  terms and provisions available  to  other  executive\nemployees of the Company.\n\n           (e)  Location.  You will continue to be employed at the business\nlocation at which you were employed prior to the Change in Control Date and\nthe  amount  of time that you are required to travel for business  purposes\nwill  not  be  increased  in any significant respect  from  the  amount  of\nbusiness travel required of you prior to the Change in Control Date.\n\n          3.   Involuntary Termination During the Term.\n\n           (a)   Severance  Payment.   In the  event  of  your  Involuntary\nTermination during the Term, the Company shall pay you within 5 days of the\ndate  of  such  Involuntary Termination the full amount of any  earned  but\nunpaid base salary through the Date of Termination at the rate in effect at\nthe  time of the Notice of Termination, plus a cash payment (calculated  on\nthe  basis of your Reference Salary) for all unused vacation time which you\nmay have accrued as of the Date of Termination.  The Company shall also pay\nyou  within  5  days of the Date of Termination a pro rata portion  of  the\nannual  bonus  for  the year in which your Involuntary Termination  occurs,\ncalculated  on  the basis of your target bonus for that  year  and  on  the\nassumption that all performance targets have been or will be achieved.   In\naddition,  the  Company shall pay you in a cash lump  sum,  within  8  days\nfollowing the date of your execution of the release described in  the  last\nsentence of this Section 3(a) (or on the Date of Termination, if later), an\namount  (the  'Severance Payment') equal to the sum of (i) two  times  your\nReference  Salary and (ii) one times your Reference Bonus.   The  Severance\nPayment  shall  be in lieu of any other severance payments  which  you  are\nentitled  to  receive  under any other severance pay  plan  or  arrangement\nsponsored by the Company and its subsidiaries.  Your right to the Severance\nPayment  shall be conditioned upon your execution of a release in favor  of\nthe  Company  in  substantially the form of the release  required  for  the\nreceipt of severance payments under the Severance Plan (as in effect on the\ndate  of  this Agreement) which is not revoked by you within the  seven-day\nrevocation period specified therein.\n\n            (b)   Benefit  Payment.   In  the  event  of  your  Involuntary\nTermination  during  the  Term,  you and  your  eligible  dependents  shall\ncontinue  to  be  eligible to participate during the  Benefit  Continuation\nPeriod  (as hereinafter defined) in the medical, dental, health,  life  and\nother  fringe benefit plans and arrangements applicable to you  immediately\nprior  to your Involuntary Termination on the same terms and conditions  in\neffect  for  you and your dependents immediately prior to such  Involuntary\nTermination.   For purposes of the previous sentence, 'Benefit Continuation\nPeriod' means the period beginning on the Date of Termination and ending on\nthe  earlier  to  occur  of  (i) the second  anniversary  of  the  Date  of\nTermination and (ii) the date that you and your dependents are eligible and\nelect  coverage  under  the plans of a subsequent  employer  which  provide\nsubstantially equivalent or greater benefits to you and your dependents.\n\n           (c)   Date and Notice of Termination.  Any termination  of  your\nemployment  by the Company or by you during the Term shall be  communicated\nby  a  notice  of  termination to the other party hereto  (the  'Notice  of\nTermination').   The  Notice  of Termination shall  indicate  the  specific\ntermination provision in this Agreement relied upon and shall set forth  in\nreasonable  detail the facts and circumstances claimed to provide  a  basis\nfor  termination of your employment under the provision so indicated.   The\ndate   of  your  termination  of  employment  with  the  Company  and   its\nsubsidiaries  (the 'Date of Termination') shall be determined  as  follows:\n(i) if your employment is terminated for Disability, thirty (30) days after\na Notice of Termination is given (provided that you shall not have returned\nto  the  full-time performance of your duties during such thirty  (30)  day\nperiod),  (ii)  if  your employment is terminated  by  the  Company  in  an\nInvoluntary  Termination,  five (5) days  after  the  date  the  Notice  of\nTermination  is received by you and (iii) if your employment is  terminated\nby the Company for Cause, the later of the  date specified in the Notice of\n                             49\n\n\nTermination or ten (10) days following the date such notice is received  by\nyou.  If the basis  for your Involuntary  Termination  is  your resignation \nfor Good Reason, the Date of  Termination shall  be  ten  (10)  days  after \nthe date your  Notice  of  Termination  is received  by  the Company.   The \nDate of Termination for a  resignation  of  employment  other than for Good \nReason shall be  the date set forth  in  the applicable notice, which shall \nbe no earlier than ten (10) days after  the date such notice is received by \nthe Company.\n\n           (d)   No  Mitigation or Offset.  You shall not  be  required  to\nmitigate  the  amount  of any payment provided for  in  this  Agreement  by\nseeking  other employment or otherwise, nor shall the amount of any payment\nor  benefit  provided for in this Agreement be reduced by any  compensation\nearned by you as the result of employment by another employer or by pension\nbenefits  paid  by  the  Company or another  employer  after  the  Date  of\nTermination or otherwise except as specifically provided in clause (ii)  of\nthe last sentence of Section 3(b).\n\n          4.   Additional Payment.\n\n           (a)   Gross-Up Payment.  Notwithstanding anything herein to  the\ncontrary,  if  it is determined that any Payment would be  subject  to  the\nexcise tax imposed by Section 4999 of the Code or any interest or penalties\nwith  respect  to  such  excise tax (such excise  tax,  together  with  any\ninterest  or penalties thereon, is herein referred to as an 'Excise  Tax'),\nthen  you shall be entitled to an additional payment (a 'Gross-Up Payment')\nin  an  amount that will place you in the same after-tax economic  position\nthat  you  would  have enjoyed if the Excise Tax had  not  applied  to  the\nPayment.   The  amount of the Gross-Up Payment shall be determined  by  the\nAccounting Firm in accordance with the formula\n{(E  x (1 - M)\/(1 - T)) - E} (or such other formula as the Accounting  Firm\ndeems appropriate which is intended to achieve the same result), where\n\n          E    equals  the  Payments  which are determined  to  be  'excess\n               parachute payments' within the meaning of Section 280G(b)(1)\n               of the Code;\n     \n          M    equals the sum of the highest marginal ratesTo be\n               expressed in up to three decimal places.  For example, a\n               combined federal, state and local marginal rate of 56% would\n               be expressed as .560. for Taxes applicable to you at the\n               time of the Payment; and\n\n          T    equals  M  plus  the  rate of Excise Tax applicable  to  the\n               Payment.\n\nNo  Gross-Up  Payments shall be payable hereunder if  the  Accounting  Firm\ndetermines that the Payments are not subject to an Excise Tax.\n\n            (b)   Determination  of  Gross-Up  Payment.   Subject  to   the\nprovisions of Section 4(c), all determinations required under this  Section\n4,  including  whether a Gross-Up Payment is required, the  amount  of  the\nPayments  constituting excess parachute payments, and  the  amount  of  the\nGross-Up Payment, shall be made by the Accounting Firm, which shall provide\ndetailed supporting calculations both to you and the Company within fifteen\ndays  of the Change in Control Date, your Date of Termination or any  other\ndate  reasonably  requested by you or the Company on which a  determination\nunder  this Section 4 is necessary or advisable.  The Company shall pay  to\nyou  the  initial Gross-Up Payment within 5 days of the receipt by you  and\nthe Company of the Accounting Firm's determination.  If the Accounting Firm\ndetermines  that no Excise Tax is payable by you, the Company  shall  cause\nthe Accounting Firm to provide you with an opinion that the Accounting Firm\nhas substantial authority under  the Code and  Regulations not to report an \n                             50\n\n\nExcise Tax on your federal  income  tax  return.   Any determination by the \nAccounting  Firm  shall  be binding  upon   you  and  the Company.   If the \ninitial  Gross-Up  Payment  is  insufficient  to  cover  the  amount of the \nExcise Tax  that  is  ultimately determined to be owing by you with respect \nto  any  Payment  (hereinafter   an  'Underpayment'),  the  Company,  after \nexhausting its remedies  under  Section 4(c)  below,  shall promptly pay to \nyou an additional Gross-Up  Payment  in respect of the Underpayment.\n\n           (c)  Procedures.  You shall notify the Company in writing of any\nclaim  by  the Internal Revenue Service that, if successful, would  require\nthe  payment  by the Company of a Gross-Up Payment.  Such notice  shall  be\ngiven as soon as practicable after you know of such claim and shall apprise\nthe  Company of the nature of the claim and the date on which the claim  is\nrequested  to be paid.  You agree not to pay the claim until the expiration\nof  the  thirty-day  period following the date  on  which  you  notify  the\nCompany,  or such shorter period ending on the date the Taxes with  respect\nto such claim are due (the 'Notice Period'). If the Company notifies you in\nwriting  prior  to the expiration of the Notice Period that it  desires  to\ncontest  the  claim,  you  shall:  (i) give  the  Company  any  information\nreasonably requested by the Company relating to the claim; (ii)  take  such\naction  in connection with the claim as the Company may reasonably request,\nincluding, without limitation, accepting legal representation with  respect\nto  such  claim  by  an attorney reasonably selected  by  the  Company  and\nreasonably  acceptable to you; (iii) cooperate with  the  Company  in  good\nfaith  in  contesting the claim; and (iv) permit the Company to participate\nin  any proceedings relating to the claim.  You shall permit the Company to\ncontrol all proceedings related to the claim and, at its option, permit the\nCompany to pursue or forgo any and all administrative appeals, proceedings,\nhearings,  and  conferences with the taxing authority in  respect  of  such\nclaim.   If  requested  by the Company, you agree either  to  pay  the  tax\nclaimed and sue for a refund or contest the claim in any permissible manner\nand  to prosecute such contest to a determination before any administrative\ntribunal,  in a court of initial jurisdiction and in one or more  appellate\ncourts  as  the Company shall determine; provided, however,  that,  if  the\nCompany  directs  you  to pay such claim and pursue a refund,  the  Company\nshall  advance  the  amount of such payment to  you  on  an  after-tax  and\ninterest-free basis (the 'Advance').  The Company's control of the  contest\nrelated to the claim shall be limited to the issues related to the Gross-Up\nPayment and you shall be entitled to settle or contest, as the case may be,\nany  other  issues raised by the Internal Revenue Service or  other  taxing\nauthority.  If the Company does not notify you in writing prior to the  end\nof  the Notice Period of its desire to contest the claim, the Company shall\npay  to  you  an  additional  Gross-Up Payment in  respect  of  the  excess\nparachute payments that are the subject of the claim, and you agree to  pay\nthe  amount  of  the Excise Tax that is the subject of  the  claim  to  the\napplicable taxing authority in accordance with applicable law.\n\n           (d)   Repayments.  If, after receipt by you of an  Advance,  you\nbecome entitled to a refund with respect to the claim to which such Advance\nrelates, you shall pay the Company the amount of the refund (together  with\nany interest paid or credited thereon after Taxes applicable thereto).  If,\nafter  receipt by you of an Advance, a determination is made that you shall\nnot  be  entitled to any refund with respect to the claim and  the  Company\ndoes not promptly notify you of its intent to contest the denial of refund,\nthen  the amount of the Advance shall not be required to be repaid  by  you\nand  the  amount thereof shall offset the amount of the additional Gross-Up\nPayment then owing to you.\n\n           (e)   Further Assurances.  The Company shall indemnify  you  and\nhold  you  harmless,  on  an  after-tax basis, from  any  costs,  expenses,\npenalties, fines, interest or other liabilities ('Losses') incurred by  you\nwith respect to the exercise by the Company of any of its rights under this\nSection  4,  including,  without limitation,  any  Losses  related  to  the\nCompany's  decision  to  contest a claim  or  any  imputed  income  to  you\nresulting  from any Advance or action taken on your behalf by  the  Company\nhereunder.   The  Company shall pay all legal fees  and  expenses  incurred\nunder  this  Section 4, and shall promptly reimburse you for the reasonable\nexpenses  incurred  by  you in connection with any  actions  taken  by  the\nCompany  or required to be taken by you hereunder.  The Company shall  also\npay all of the fees and expenses of the Accounting Firm, including, without\nlimitation,  the fees and expenses related to the opinion  referred  to  in\nSection 4(b).\n                             51\n\n\n           (f)   Combined  Payments.   Anything in this Section  4  to  the\ncontrary notwithstanding, the Company shall have no obligation to pay you a\nrequired  Gross-Up Payment under this Section 4 if the aggregate amount  of\nall  Combined  Payments has at the time such payment is  due  exceeded  the\nLimit.   If  the amount of a Gross-Up Payment to you under this  Section  4\nwould  result  in  the Combined Payments exceeding the Limit,  the  Company\nshall  pay you only the portion, if any, of the Gross-Up Payment which  can\nbe  paid  to  you  without  causing the aggregate amount  of  all  Combined\nPayments to exceed the Limit. In the event that you are entitled to a Gross-\nUp  Payment under this Section 4 and other employees or former employees of\nthe  Company are also entitled to gross-up payments under the corresponding\nprovisions of the applicable Combined Arrangements and the aggregate amount\nof  all  such  payments would cause the Limit on Combined  Payments  to  be\nexceeded,  the Company shall allocate the amount of the reduction necessary\nto comply with the Limit among all such payments in the proportion that the\namount  of each such gross-up payment bears to the aggregate amount of  all\nsuch payments.  Nothing in this Section 4(f) shall require you to repay  to\nthe  Company any amount that was previously paid to you under this  Section\n4.\n\n          5.   Other Provisions.\n\n           (a)   Vesting  and Exercise.  All Equity Awards granted  to  you\nunder  the Equity Plans (including Short-Term Awards) shall vest and become\nexercisable  in the event of your Involuntary Termination on  or  following\nthe Change in Control Date.  If you are employed by the Company on the date\nof  the  Equity  Plan Change in Control, your Equity Awards will  vest  and\nbecome exercisable as of such date.\n\n           (b)  Effect of 30-Day Alternative.  In accordance with the terms\nof  the  Equity Plans, upon an Equity Plan Change in Control, Equity Awards\nwhich are options or stock appreciation rights are 'cashed out,' unless the\nAdministrator in its discretion determines not to do so.  In the event that\nthe   Administrator  elects  not  to  cash  out  such  Equity  Awards,  the\nAdministrator has the discretion in the context of a merger or sale of  all\nor  substantially all of the assets of the Company either (i) to cause such\nEquity  Awards to be assumed or an equivalent option or stock  appreciation\nright  granted by the successor corporation to the Company or a  parent  or\nsubsidiary  of  such successor corporation, or (ii) to  provide  that  your\nEquity Awards will remain outstanding for a thirty-day period beginning  on\nthe  date that you are so notified of such action by the Administrator  and\nthat such Equity Awards will expire to the extent not exercised at the  end\nof such thirty-day period (the '30-Day Alternative').  If the Administrator\ndetermines  to  utilize the 30-Day Alternative, the Company shall  pay  you\nwith  respect to each such Equity Award the excess, if any (the 'Additional\nAmount'),  of the Change in Control Price you would have received  had  the\nEquity  Award  been  cashed out on the date of the Equity  Plan  Change  in\nControl  over the value of the consideration actually received  by  you  in\nsettlement of such awards (determined as of the date such consideration  is\nreceived by you).  Further, in the event of your Involuntary Termination on\nor  after  the Change in Control Date but on or prior to the  date  of  the\nEquity  Plan  Change in Control, the Company shall pay you  the  Additional\nAmount  as if your employment had continued through the date of the  Equity\nPlan  Change  in  Control.  In either case, the payment of  the  Additional\nAmount  shall  be  made  within 5 days following the determination  by  the\nAdministrator of the Change in Control Price.\n\n           (c)   Short-Term Awards.  In the event that (i) the  transaction\nresulting in an Equity Plan Change in Control occurs at such a time  or  is\nstructured  in  such a manner so as to make it reasonably likely  that  you\nwould  be subject to actual or potential liability for short-swing  profits\nunder  Section  16 of the Exchange Act ('Short-Swing Profit Liability')  if\nyou  were to exercise, tender, sell or otherwise dispose (including through\na  merger)  of  your  Short-Term Awards as  part  of,  or  prior  to,  such\ntransaction and (ii) your inability to exercise, tender, sell or  otherwise\ndispose  of  your Short-Term Awards on or prior to the date of such  Equity\nPlan  Change in Control eliminates or reduces the value of some or  all  of\nyour  Short-Term  Awards, then, on the date of the Equity  Plan  Change  in\nControl,  the  Company  shall pay you in a cash  lump  sum  the  amount  of\n .   The  provisions of clause (ii) of the previous sentence shall be deemed\nto apply where (a) you are precluded from exercising,\n                             52\n\n\ntendering or otherwise disposing of your Short-Term Awards on or  prior  to\nthe Transaction Date in order to avoid Short-Swing Profit Liability, (b)  a\nShort-Term  Award  cannot be repurchased, exchanged or  cashed-out  by  the\nCompany  (or  other person) on or prior to the Transaction Date  without  a\nrisk  of  Short-Swing Profit Liability to you, or (c) you are  required  to\ndelay  the  exercise, sale, tender, or other disposition of your Short-Term\nAwards  in  order  to  avoid Short-Swing Profit Liability  and  such  delay\nresults  in your receiving consideration for your Short-Term Awards (valued\nat  the date such consideration is received) which is of lesser value  than\nthe  consideration you would have received (valued as of the  date  of  the\nEquity Plan Change in Control) for such awards had such delay not occurred.\nThe  foregoing provisions shall apply to your Equity Awards notwithstanding\nyour Involuntary Termination of employment with the Company on or after the\nChange in Control Date but prior to the Equity Plan Change in Control.  The\nprovisions of this Section 5(c) shall not apply if (A) prior to the  Equity\nPlan  Change  in Control, the Company provides you at its expense  with  an\nopinion  from  a nationally recognized firm of attorneys stating  that  the\nexercise,  tender, sale or other disposition of your Short-Term  Awards  as\npart  of, or prior to, the transaction resulting in the Equity Plan  Change\nin  Control  will not subject you to Short-Swing Profit Liability  and  (B)\nfollowing your receipt of such opinion there is sufficient time for you  to\nexercise, tender, sell or otherwise dispose of your Short-Term Awards on or\nprior  to  the  Equity Plan Change in Control without impairing  the  value\nthereof.\n\n           (d)   General.   Anything  in  this Agreement  to  the  contrary\nnotwithstanding,   in  no  event  shall  the  vesting  and   exercisability\nprovisions applicable to you under the terms of your Equity Awards be  less\nfavorable to you then the terms and provisions of such awards in effect  on\nthe date hereof.\n\n          6.   Legal Fees and Expenses.  The Company shall pay or reimburse\nyou  on  an after-tax basis for all costs and expenses (including,  without\nlimitation,  court  costs  and reasonable legal  fees  and  expenses  which\nreflect  common practice with respect to the matters involved) incurred  by\nyou  as a result of any claim, action or proceeding (i) arising out of your\ntermination  of employment during the Term, (ii) contesting,  disputing  or\nenforcing any right, benefits or obligations under this Agreement or  (iii)\narising  out of or challenging the validity, advisability or enforceability\nof  this  Agreement or any provision thereof; provided, however,  that  the\namount  of  the payments and reimbursements under this Section 6 shall  not\nexceed $2 million.\n\n          7.   Successors; Binding Agreement.\n\n           (a)   Assumption  by  Successor. The Company  will  require  any\nsuccessor  (whether direct or indirect, by purchase, merger,  consolidation\nor  otherwise) to all or substantially all of the business or assets of the\nCompany expressly to assume and to agree to perform this Agreement  in  the\nsame  manner  and to the same extent that the Company would be required  to\nperform  it if no such succession had taken place; provided, however,  that\nno  such assumption shall relieve the Company of its obligations hereunder.\nAs  used  in  this  Agreement, the 'Company'  shall  mean  the  Company  as\nhereinbefore  defined and any successor to its business  and\/or  assets  as\naforesaid  which assumes and agrees to perform this Agreement by  operation\nof law or otherwise.\n\n           (b)   Enforceability; Beneficiaries.  This  Agreement  shall  be\nbinding   upon  and  inure  to  the  benefit  of  you  (and  your  personal\nrepresentatives  and  heirs)  and the Company and  any  organization  which\nsucceeds  to  substantially all of the business or assets of  the  Company,\nwhether  by  means  of  merger,  consolidation,  acquisition  of   all   or\nsubstantially  all  of  the assets of the Company or otherwise,  including,\nwithout  limitation, as a result of a Change in Control or by operation  of\nlaw.   This  Agreement shall inure to the benefit of and be enforceable  by\nyour   personal   or  legal  representatives,  executors,   administrators,\nsuccessors, heirs, distributees, devisees and legatees.  If you should  die\nwhile  any  amount  would  still be payable to you  hereunder  if  you  had\ncontinued  to  live,  all such amounts, unless otherwise  provided  herein,\nshall  be  paid  in  accordance with the terms of this  Agreement  to  your\ndevisee,  legatee  or other designee or, if there is no such  designee,  to\nyour estate.\n                             53\n\n\n           8.   Definitions.  For purposes of this Agreement, the following\ncapitalized words shall have the meanings set forth below:\n\n           'Accounting Firm' shall mean Ernst &amp; Young or, if such  firm  is\nunable  or  unwilling  to perform such calculations,  such  other  national\naccounting  firm as shall be designated by agreement between  you  and  the\nCompany.   To  the extent reasonably practicable, one such accounting  firm\nshall  be designated to perform the calculations in respect of the Combined\nArrangements.\n\n           'Administrator' shall mean the 'Administrator' as defined in the\napplicable  Equity Plan or, if no such term is defined in the Equity  Plan,\nthe Board.\n\n           'Cause'  shall mean a termination of your employment during  the\nTerm  which  is a result of (i) your felony conviction, (ii)  your  willful\ndisclosure  of  material  trade  secrets  or  other  material  confidential\ninformation related to the business of the Company and its subsidiaries  or\n(iii)  your  willful and continued failure substantially  to  perform  your\nduties  with the Company (other than any such failure resulting  from  your\nincapacity  due  to  physical  or mental illness  or  any  such  actual  or\nanticipated  failure resulting from a resignation by you for  Good  Reason)\nafter  a written demand for substantial performance is delivered to you  by\nthe  Board,  which demand specifically identifies the manner in  which  the\nBoard  believes that you have not substantially performed your duties,  and\nwhich  performance is not substantially corrected by you within 10 days  of\nreceipt of such demand.   For purposes of the previous sentence, no act  or\nfailure  to  act  on your part shall be deemed 'willful'  unless  done,  or\nomitted to be done, by you not in good faith and without reasonable  belief\nthat  your  action  or omission was in the best interest  of  the  Company.\nNotwithstanding  the  foregoing, you shall  not  be  deemed  to  have  been\nterminated  for Cause unless and until there shall have been  delivered  to\nyou a copy of a resolution duly adopted by the affirmative vote of not less\nthan  three-fourths (3\/4ths) of the entire membership of  the  Board  at  a\nmeeting  of  the  Board called and held for such purpose (after  reasonable\nnotice to you and an opportunity for you, together with your counsel, to be\nheard  before  the Board), finding that in the good faith  opinion  of  the\nBoard  you  were guilty of conduct set forth above in clause (i),  (ii)  or\n(iii)  of the first sentence of this section and specifying the particulars\nthereof in detail.\n\n            'Change  in  Control' shall mean a change  in  control  of  the\nCompany  of  a nature that would be required to be reported in response  to\nItem  6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange\nAct,  whether  or  not  the  Company is  then  subject  to  such  reporting\nrequirement;  provided, however, that, anything in this  Agreement  to  the\ncontrary  notwithstanding, a Change in Control  shall  be  deemed  to  have\noccurred if:\n\n          (i)  any individual, partnership, firm, corporation, association,\n     trust,  unincorporated organization or other entity or person, or  any\n     syndicate or group deemed to be a person under Section 14(d)(2) of the\n     Exchange Act, is or becomes the 'beneficial owner' (as defined in Rule\n     13d-3  of  the General Rules and Regulations under the Exchange  Act),\n     directly or indirectly, of securities of the Company representing  30%\n     or more of the combined voting power of the Company's then outstanding\n     securities  entitled  to  vote in the election  of  directors  of  the\n     Company;\n     \n           (ii)  during  any  period  of  two (2)  consecutive  years  (not\n     including  any  period  prior  to the  execution  of  this  Agreement)\n     individuals who at the beginning of such period constituted the  Board\n     and  any new directors, whose election by the Board or nomination  for\n     election  by the Company's stockholders was approved by a vote  of  at\n     least three-fourths (3\/4ths) of the directors then still in office who\n     either were directors at the beginning of the period or whose election\n     or  nomination for election was previously so approved (the 'Incumbent\n     Directors'), cease for any reason to constitute a majority thereof;\n                             54\n\n     \n          (iii)     There occurs a reorganization, merger, consolidation or\n     other  corporate  transaction involving the Company (a 'Transaction'),\n     in  each  case, with respect to which the stockholders of the  Company\n     immediately  prior to such Transaction do not, immediately  after  the\n     Transaction, own more than 50 percent of the combined voting power  of\n     the Company or other corporation resulting from such Transaction;\n     \n           (iv)  all or substantially all of the assets of the Company  are\n     sold, liquidated or distributed; or\n     \n           (v)   there  is a 'change in control' of the Company within  the\n     meaning of Section 280G of the Code and the Regulations.\n     \n           'Change in Control Date' shall mean the earliest of (i) the date\non  which the Change in Control occurs, (ii) the date on which the  Company\nexecutes  an  agreement,  the consummation of which  would  result  in  the\noccurrence  of  a  Change in Control, (iii) the date the Board  approves  a\ntransaction  or  series of transactions, the consummation  of  which  would\nresult  in  a  Change  in Control and (iv) the date the  Company  fails  to\nsatisfy its obligations to have this agreement assumed by any successor  to\nthe  Company  in  accordance with Section 7(a) of this Agreement.   If  the\nChange  in  Control  Date occurs as a result of an agreement  described  in\nclause (ii) of the previous sentence or as a result of the approval of  the\nBoard described in clause (iii) of the previous sentence and the Change  in\nControl  to  which  such agreement or approval relates  (the  'Contemplated\nChange in Control') subsequently does not occur, then the Term shall expire\non  the  sixtieth  day  (the 'Reset Date') following  the  date  the  Board\ncertifies  by  resolution  duly adopted by three-fourths  (3\/4ths)  of  the\nIncumbent Directors then in office that the Contemplated Change in  Control\nis  not  reasonably likely to occur; provided, however, that this  sentence\nshall  not apply if (A) an Involuntary Termination of your employment  with\nthe Company has occurred on and after the Change in Control Date and on  or\nprior  to  the  Reset  Date  or  (B)  the Contemplated  Change  in  Control\nsubsequently  occurs within three months of the Reset Date.  Following  the\nReset  Date, the provisions of this Agreement shall remain in effect and  a\nnew  Term  shall  commence upon the occurrence of a  subsequent  Change  in\nControl Date.  Notwithstanding the first sentence of this section, if  your\nemployment with the Company terminates prior to the Change in Control  Date\nand  it is reasonably demonstrated that your termination of employment  (i)\nwas  at  the  request  of  the third party who has taken  steps  reasonably\ncalculated  to  effect  the Change in Control or (ii)  otherwise  arose  in\nconnection with or in anticipation of the Change in Control, then Change in\nControl  Date  shall mean the date immediately prior to the  date  of  your\ntermination of employment.\n\n           'Change  in  Control Price' shall mean the  'Change  in  Control\nPrice'  as  defined  in the applicable Equity Plan and  determined  by  the\nAdministrator as of the date of the Equity Plan Change in Control,  whether\nor  not  the  Administrator is required under the terms of  the  applicable\nEquity Plan to determine such price as of such date.\n\n           'Combined Arrangements' shall mean this Agreement, the Retention\nAgreements  entered into as of the date first set forth above  between  the\nCompany  and  certain  of its executive officers, any  Retention  Agreement\nentered into after the date hereof which is specifically designated by  the\nterms thereof as one of the Combined Arrangements and the Supplement to the\nSeverance Plan.\n\n           'Combined Payments' shall mean the aggregate cash amount of  (i)\nseverance payments made to you under Section 3(a) of this Agreement  or  to\nany other employee or former employee under the corresponding provisions of\nthe  applicable  Combined Arrangement, (ii) severance payments  made  under\nSections 2(e) and 2(f) of the Supplement or the corresponding provisions of\nthe  applicable Combined Arrangement, (iii) Gross-Up Payments made  to  you\nunder  Section  6  of  this Agreement or to any other  employee  or  former\nemployee under the\n                             55\n\n\ncorresponding provisions of the applicable Combined Arrangement, (iv)  fees\nand  expenses which are paid or reimbursed to you under Section 6  of  this\nAgreement   or  to  any  other  employee  or  former  employee  under   the\ncorresponding  provisions  of  the  applicable  Combined  Arrangement,  (v)\npayments  made  to you under Section 5 of this Agreement or  to  any  other\nemployee  or  former  employee under the corresponding  provisions  of  the\napplicable  Combined Arrangement and (vi) costs incurred by the Company  in\nrespect  of  any  employee or former employee under  Section  2(d)  of  the\nSupplement  or  the  corresponding provisions of  the  applicable  Combined\nArrangement.\n\n           'Code' shall mean the Internal Revenue Code of 1986, as amended,\nand any successor provisions thereto.\n\n          'Common Stock' shall mean the common stock of the Company.\n\n           'Disability' shall mean (i) your incapacity due to  physical  or\nmental illness which causes you to be absent from the full-time performance\nof  your  duties with the Company for six (6) consecutive months, and  (ii)\nyour  failure  to return to full-time performance of your  duties  for  the\nCompany within thirty (30) days after written Notice of Termination due  to\nDisability  is  given  to you.  Any question as to the  existence  of  your\nDisability  upon which you and the Company cannot agree shall be determined\nby a qualified independent physician selected by you (or, if you are unable\nto make such selection, such selection shall be made by any adult member of\nyour immediate family), and approved by the Company.  The determination  of\nsuch physician made in writing to the Company and to you shall be final and\nconclusive for all purposes of this Agreement.\n\n           'ELTSOP' shall mean the Apple Computer, Inc. 1987 Executive Long\nTerm Stock Option Plan, as amended, and any successor plan thereto.\n\n          'Equity Awards' shall mean options, restricted stock, bonus stock\nor other grants or awards which consist of, or relate to, equity securities\nof  the  Company and which have been granted to you under the Equity Plans.\nFor  purposes  of  this  Agreement, Equity Awards shall  also  include  any\nsecurities  acquired  upon the exercise of an option,  warrant  or  similar\nright that constitutes an Equity Award.\n\n          'Equity Plan Change in Control' shall mean a change in control of\nthe Company as defined in the applicable Equity Plan.\n\n           'Equity Plans' shall mean the Stock Option Plan, the ELTSOP, and\nany  other  equity-based  incentive plan  or  arrangement  adopted  by  the\nCompany.\n\n           'Exchange Act'  shall mean the Securities Exchange Act of  1934,\nas amended, and any successor provisions thereto.\n\n           'Good Reason' shall mean a resignation of your employment during\nthe Term as a result of any of the following:\n\n           (i)   A  meaningful and detrimental alteration in your position,\n     your  titles,  or  the  nature  or  status  of  your  responsibilities\n     (including  your  reporting responsibilities)  from  those  in  effect\n     immediately prior to the Change in Control Date;\n                             56\n\n     \n           (ii) A reduction by the Company in your annual base salary as in\n     effect immediately prior to the Change in Control Date or as the  same\n     may  be  increased  from time to time thereafter;  a  failure  by  the\n     Company  to increase your salary at a rate commensurate with  that  of\n     other  key  executives of the Company; or a reduction in  your  target\n     annual  bonus  (expressed as a percentage of base  salary)  below  the\n     target in effect for you prior to the Change in Control Date;\n     \n           (iii)     The relocation of the office of the Company where  you\n     are employed immediately prior to the Change in Control Date (the 'CIC\n     Location') to a location which is more than fifty (50) miles away from\n     the  CIC Location or the Company's requiring you to be based more than\n     fifty  (50)  miles  away from the CIC Location  (except  for  required\n     travel on the Company's business to an extent substantially consistent\n     with your customary business travel obligations in the ordinary course\n     of business prior to the Change in Control Date);\n     \n           (iv)  The  failure  by  the Company to continue  in  effect  any\n     compensation  plan in which you participated prior to  the  Change  in\n     Control  Date  or  made available to you after the Change  in  Control\n     Date,   unless  an  equitable  arrangement  (embodied  in  an  ongoing\n     substitute  or  alternative plan) has been made with respect  to  such\n     plan  in connection with the Change in Control, or the failure by  the\n     Company  to  continue  your  participation  therein  on  at  least  as\n     favorable  a  basis, both in terms of the amount of benefits  provided\n     and the level of your participation relative to other participants, as\n     existed on the Change in Control Date;\n     \n           (v)   The failure by the Company to continue to provide you with\n     benefits  at least as favorable in the aggregate to those  enjoyed  by\n     you  under  the  Company's pension, savings, life insurance,  medical,\n     health and accident, disability, and fringe benefit plans and programs\n     in  which  you were participating immediately prior to the  Change  in\n     Control  Date; or the failure by the Company to provide you  with  the\n     number of paid vacation days to which you are entitled on the basis of\n     years  of  service with the Company in accordance with  the  Company's\n     normal  vacation policy in effect immediately prior to the  Change  in\n     Control;\n     \n          (vi) The failure of the Company to obtain an agreement reasonably\n     satisfactory to you from any successor to assume and agree to  perform\n     this  Agreement,  as contemplated in Section 7(a) hereof  or,  if  the\n     business  of  the  Company  for which your  services  are  principally\n     performed  is sold at any time after a Change in Control, the  failure\n     of  the Company to obtain such an agreement from the purchaser of such\n     business;\n     \n           (vii)      Any  termination  of your  employment  which  is  not\n     effected pursuant to the terms of this Agreement; or\n\n           (viii)    A material breach by the Company of the provisions  of\n     this Agreement;\n     \nprovided, however, that an event described above in clause (i), (ii), (iv),\n(v) or (viii) shall not constitute Good Reason unless it is communicated by\nyou  to  the  Company in writing and is not corrected by the Company  in  a\nmanner  which is reasonably satisfactory to you (including full retroactive\ncorrection  with  respect to any monetary matter) within  10  days  of  the\nCompany's receipt of such written notice from you.\n\n           'Involuntary  Termination' shall mean (i)  your  termination  of\nemployment  by the Company and its subsidiaries during the Term other  than\nfor  Cause  or Disability or (ii) your resignation of employment  with  the\nCompany and its subsidiaries during the Term for Good Reason.\n                             57\n\n\n           'Limit'  shall mean the dollar amount determined  in  accordance\nwith the formula [A x B x C], where\n\n          A    equals 0.02;\n          \n          B    equals the number of issued and outstanding shares of Common\n               Stock  of  the  Company immediately prior to the  Change  in\n               Control Date; and\n          \n          C    equals  the greater of (i) (A) if the Common Stock is listed\n               on  any established stock exchange or national market system\n               (including,  without limitation, the National Market  System\n               of  the  National  Association of Securities  Dealers,  Inc.\n               Automated  Quotation ('NASDAQ') System, the highest  closing\n               sale  price (or closing bid price, if no sales are reported)\n               of  a  share of Common Stock, or (B) if the Common Stock  is\n               regularly quoted on the NASDAQ System (but not on a national\n               market  system) or quoted by a recognized securities  dealer\n               but  selling  prices  are  not reported,  the  highest  mean\n               between the high and low asked prices for the Common  Stock,\n               in each case, on any day during the ninety-day period ending\n               on  the  Change in Control Date, and (ii) the highest  price\n               paid  or  offered, as determined by the Accounting Firm,  in\n               any  bona fide transaction or bona fide offer related to the\n               Change in Control.\n          \n           'Payment'  means (i) any amount due or paid to  you  under  this\nAgreement,  (ii)  any  amount that is due or paid to you  under  any  plan,\nprogram  or  arrangement  of the Company and its  subsidiaries  (including,\nwithout limitation, the Equity Plans), and (iii) any amount or benefit that\nis due or payable to you under this Agreement or under any plan, program or\narrangement of the Company and its subsidiaries not otherwise covered under\nclause (i) or (ii) hereof which must reasonably be taken into account under\nSection  280G of the Code and the Regulations in determining the amount  of\nthe  'parachute  payments' received by you, including, without  limitation,\nany amounts which must be taken into account under the Code and Regulations\nas  a  result  of  (A)  the  acceleration of the  vesting  of  any  option,\nrestricted  stock or other equity award granted under the Equity  Plans  or\notherwise, (B) the acceleration of the time at which any payment or benefit\nis  receivable by you or (C) any contingent severance or other amounts that\nare payable to you.\n\n          'Reference Bonus' shall mean the greater of (i) the target annual\nbonus  applicable to you for the year in which your Involuntary Termination\noccurs and (ii) the highest target annual bonus applicable to you in any of\nthe three years ending prior to the Change in Control Date.\n\n           'Reference Salary' shall mean the greater of (i) the annual rate\nof  your  base  salary  from  the Company and its  subsidiaries  in  effect\nimmediately prior to the date of your Involuntary Termination and (ii)  the\nannual  rate  of your base salary from the Company in effect at  any  point\nduring the three-year period ending on the Change in Control Date.\n\n           'Regulations'  shall  mean  the proposed,  temporary  and  final\nregulations  under  Section  280G of the Code or  any  successor  provision\nthereto.\n\n           'Severance  Plan'  means  the  Apple  Computer,  Inc.  Executive\nSeverance Plan, as amended.\n\n           'Short-Term  Awards' shall mean Equity Awards  which  have  been\ngranted  to you within the six-month period ending on the date of a  Equity\nPlan  Change in Control.  For purposes of this Agreement, Short-Term Awards\nshall  also include any securities acquired upon the exercise of an  Equity\nAward that constitutes a Short-Term Award.\n                             58\n\n\n           'Stock  Option  Plan' shall mean the Apple Computer,  Inc.  1990\nStock Option Plan, as amended, and any successor plan thereto.\n\n          'Supplement' means the amendment to the Severance Plan adopted as\nof the date of this Agreement and any future amendment thereto.\n\n           'Taxes' shall mean the federal, state and local income taxes  to\nwhich you are subject at the time of determination, calculated on the basis\nof  the  highest marginal rates then in effect, plus any additional payroll\nor withholding taxes to which you are then subject.\n\n          'Transaction Date' shall mean the date described in clause (i) of\nthe definition of Change in Control Date.\n\n           9.   Notice.  For the purpose of this Agreement, notices and all\nother communications provided for in this Agreement shall be in writing and\nshall  be deemed to have been duly given when delivered or mailed by United\nStates   registered  mail,  return  receipt  requested,  postage   prepaid,\naddressed to the Board of Directors, Apple Computer, Inc., 1 Infinite Loop,\nM\/S: 75 8A, Cupertino, CA  95014, with a copy to the General Counsel of the\nCompany,  or  to  you at the address set forth on the first  page  of  this\nAgreement  or  to such other address as either party may have furnished  to\nthe  other in writing in accordance herewith, except that notice of  change\nof address shall be effective only upon receipt.\n\n          10.  Miscellaneous.\n\n           (a)   Amendments, Waivers, Etc.   No provision of this Agreement\nmay  be modified, waived or discharged unless such waiver, modification  or\ndischarge is agreed to in writing.  No waiver by either party hereto at any\ntime  of  any breach by the other party hereto of, or compliance with,  any\ncondition  or  provision of this Agreement to be performed  by  such  other\nparty  shall  be  deemed  a waiver of similar or dissimilar  provisions  or\nconditions  at the same or at any prior or subsequent time.  No  agreements\nor  representations, oral or otherwise, express or implied, with respect to\nthe  subject  matter hereof have been made by either party  which  are  not\nexpressly  set  forth in this Agreement and this Agreement shall  supersede\nall   prior  agreements,  negotiations,  correspondence,  undertakings  and\ncommunications of the parties, oral or written, with respect to the subject\nmatter  hereof;  provided, however, that, except  as  expressly  set  forth\nherein,  this  Agreement  shall not supersede the terms  of  Equity  Awards\npreviously granted to you.\n\n           (b)   Validity.   The  invalidity  or  unenforceability  of  any\nprovision of this Agreement shall not affect the validity or enforceability\nof  any other provision of this Agreement, which shall remain in full force\nand effect.\n\n           (c)   Counterparts.  This Agreement may be executed  in  several\ncounterparts, each of which shall be deemed to be an original  but  all  of\nwhich together will constitute one and the same instrument.\n\n           (d)  No Contract of Employment.  Nothing in this Agreement shall\nbe  construed as giving you any right to be retained in the employ  of  the\nCompany  or  shall affect the terms and conditions of your employment  with\nthe Company prior to the commencement of the Term hereof.\n\n          (e)  Withholding.  Amounts paid to you hereunder shall be subject\nto all applicable federal, state and local withholding taxes.\n                             59\n\n\n           (f)   Source  of  Payments.  All payments  provided  under  this\nAgreement,  other  than  payments made pursuant to a  plan  which  provides\notherwise, shall be paid in cash from the general funds of the Company, and\nno  special or separate fund shall be established, and no other segregation\nof  assets  made,  to  assure payment.  You will have no  right,  title  or\ninterest whatsoever in or to any investments which the Company may make  to\naid it in meeting its obligations hereunder.  To the extent that any person\nacquires a right to receive payments from the Company hereunder, such right\nshall be no greater than the right of an unsecured creditor of the Company.\n\n           (g)   Headings.   The headings contained in this  Agreement  are\nintended  solely  for  convenience of reference and shall  not  affect  the\nrights of the parties to this Agreement.\n\n           (h)  Governing Law.  The validity, interpretation, construction,\nand  performance  of this Agreement shall be governed by the  laws  of  the\nState  of California applicable to contracts entered into and performed  in\nsuch State.\n\n                  *       *      *       *\n                              \n           If  this  letter sets forth our agreement on the subject  matter\nhereof,  kindly sign and return to the Company the enclosed  copy  of  this\nletter which will then constitute our agreement on this subject.\n\n                                   Sincerely,\n\n                                   APPLE COMPUTER, INC.\n\n\n\n                                   By_\/s\/ G.F. Amelio__\n                                       Name:\n                                       Title:\n\n\nAgreed to as of this 4th day of March, 1996.\n\n\n\n_\/s\/ F.D. Anserson___\nFred D. Anderson, Jr.\n                             60\n\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6722],"corporate_contracts_industries":[9508],"corporate_contracts_types":[9539,9544],"class_list":["post-40369","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-apple-computer-inc","corporate_contracts_industries-technology__hardware","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40369","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40369"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40369"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40369"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40369"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}