SEC FORM 4

SEC Form 4

FORM 4

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person^*

MCNEALY SCOTT G

(Last)

(First)

(Middle)

4150 NETWORK CIRCLE

(Street)

SANTA CLARA

95054

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
SUN MICROSYSTEMS, INC. [ SUNW ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

X	Director	10% Owner
X	Officer (give title below)	Other (specify below)
	Chairman and CEO

3. Date of Earliest Transaction (Month/Day/Year)
02/17/2006

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock	02/17/2006		M		2,400,000	A	$3.125	3,770,705⁽¹⁾	D
Common Stock	02/17/2006		S		500,000	D	$4.3	3,270,705⁽¹⁾	D
Common Stock	02/17/2006		S		408,100	D	$4.31	2,862,605⁽¹⁾	D
Common Stock	02/17/2006		S		289,898	D	$4.32	2,572,707⁽¹⁾	D
Common Stock	02/17/2006		S		436,302	D	$4.33	2,136,405⁽¹⁾	D
Common Stock	02/17/2006		S		300	D	$4.34	2,136,105⁽¹⁾	D
Common Stock	02/17/2006		S		110,938	D	$4.35	2,025,167⁽¹⁾	D
Common Stock	02/17/2006		S		75,000	D	$4.36	1,950,167⁽¹⁾	D
Common Stock	02/17/2006		S		579,462	D	$4.37	1,370,705⁽¹⁾	D
Common Stock								293,080	I	By trust
Common Stock								55,936,480	I	By trust
Common Stock								402,800	I	By trust⁽²⁾
Common Stock								5,551	I	see footnote⁽²⁾⁽⁴⁾
Common Stock								5,551	I	see footnote⁽²⁾⁽⁴⁾
Common Stock								5,551	I	see footnote⁽²⁾⁽⁴⁾
Common Stock								5,551	I	see footnote⁽²⁾⁽⁴⁾

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
Employee Stock Option (Right to Buy)	$3.125	02/17/2006		M			2,400,000	⁽³⁾	07/17/2006	Common Stock	2,400,000	$0	0	D

Explanation of Responses:

1. Includes: (i) 1,354,000 shares of restricted stock, which are held in an escrow account with respect to which Mr. McNealy has no voting power and which provides for the immediate sale of the shares upon vesting, subject to Sun's policies and applicable securities laws: and (ii) 2,063 shares purchased under the Sun Microsystems, Inc. 1990 Employee Stock Purchase Plan on October 31, 2005.

2. The reporting person disclaims beneficial ownership of these securities, and the filing of this report is not an admission that the reporting person is the beneficial owner of these securities for the purposes of Section 16 or any other purpose.

3. This option was fully vested.

4. These shares are held in a California Uniform Transfer to Minors Act account for the reporting person's child. The reporting person's spouse is custodian of the account.

	/s/ Scott G. McNealy	02/22/2006
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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