“In 2013, Cook voluntarily chose to modify the massive grant of restricted stock units that he received in 2011 upon becoming CEO,” Niu writes. “He received 1 million RSU shares under the 2011 award, and these were initially only time-based awards that would continue to vest as long as Cook stayed with the company. The modification effectively converted a large portion of these shares to performance-based awards where tranches would only vest if Apple met certain criteria.”
“This modification only has the potential to be negative for Cook, and there was no upside possibility to the change for his compensation. Cook & Co. felt that it was the right thing to do to enhance corporate governance, and Cook asked the board that his 2011 award and all future equity awards be subjected to performance criteria,” Niu writes. “Apple decided that the most relevant performance metric would be total shareholder return, or TSR, which includes reinvested dividends. But Apple’s TSR must outperform comparable other companies for certain measurement periods for each related tranche to vest. If Apple performs within the top third, 100% of the tranche vests. If Apple performs within the middle third, 50% of the tranche vests. If Apple performs within the bottom third, 0% of the tranche vests.”
Read more in the full article here.
MacDailyNews Take: Whatever impetus there is for a man who’d already fabulously rich, let’s hope there’s enough of it for Apple Inc. to somehow mange to make things that they should already have on the market, like an Apple 4K (or even a 5K) monitor, for just one glaring example.
Apple’s bold compensation plan has the company and CEO Tim Cook facing a challenging year – January 7, 2016
Technical analyst: Apple may plummet another 29% – January 7, 2016
Apple stock price tumbles 3% in premarket, now trades well below $100 – January 7, 2016
Apple stock slumps near $100 amid ‘iPhone sales worries’ – January 6, 2016
Wall Street’s freak out over declining iPhone sales is overblown – January 6, 2016
Piper Jaffray: Apple’s iPhone production cut do not necessarily presage sales decline – January 6, 2016
Foxconn plans ‘rare’ holiday as iPhone output fears rattle investors – January 6, 2016
Apple to release Q116 earnings, webcast live conference call on January 26th – January 5, 2016
Apple CEO Tim Cook declines RSU dividends worth in excess of $75 million – May 24, 2012