Cook’s New Apple Pay Package Puts Money Where His Mouth Is
Apple (NASDAQ:AAPL) has altered Tim Cook’s compensation package so that the CEO has an even greater stake in the success of the company. In a filing made with the SEC on Friday, Apple states that, “Mr. Cook is leading this initiative by example and has the full support of the Board of Directors.”
Apple’s Compensation Committee made the changes after “outreach discussions this year with many of our largest shareholders.” The new performance-based compensation changes affect Cook’s future restricted stock units, or RSUs.
However, Cook decided to go even further than what the Committee was requesting. The filing notes that Cook personally requested that the new changes apply retroactively to his “2011 CEO equity award as well as any potential future awards.”
Cook’s original 1 million RSU deal would have allowed him vest half of those shares in 2016 and the other half in 2021. According to the terms of the original contract, Cook would have reaped a substantial profit regardless of how the company stock was performing. However, now 50 percent of Cook’s RSUs are directly tied to specific performance targets and are “at risk in each future annual performance-based tranche.”