A regulatory filing has revealed a new Tim Cook stock award that could see him receive an extra million AAPL shares by 2025. In the best case, Apple’s CEO would receive stock worth $114M at today’s price.
Apple confirmed the award in a brief statement …
The compensation, currently worth $76 million to $114 million depending on Apple’s share performance, gives Cook a new reason to keep running the world’s largest technology company.
The equity comes in two packages, according to a regulatory filing on Tuesday. The first comprises 333,987 restricted stock units that vest in thirds on April 1 in 2023, 2024 and 2025. The other has 333,987 units that will vest Oct. 1, 2023 and is based on Apple’s relative share performance over three years. Cook may get none of this award or 200%, depending on stock returns. If all goes well, Cook would get about 1 million shares in total.
“Tim has brought unparalleled innovation and focus to his role as CEO and demonstrated what it means to lead with values and integrity,” Apple’s board said in a statement. “For the first time in nearly a decade, we are awarding Tim a new stock grant that will vest over time in recognition of his outstanding leadership and with great optimism for Apple’s future as he carries these efforts forward.”
Apple’s statement that this is the first new stock award since Cook became CEO is true in the sense that it is the first new arrangement; Cook’s existing contract already entitles him to annual stock payouts for both length of service and the performance of AAPL against comparable shares. The most recent of these saw him receive 560,000 shares last month, worth $278M at the time.
Stock vesting over time is a common way for Apple and other companies to provide a strong incentive for executives to remain with the company. The tactic may, however, prove less effective in Cook’s case. Apple’s CEO reportedly lives a rather modest lifestyle, so has no need of the extra money. He has also pledged to give away almost all his wealth during his lifetime in ‘a systematic approach to philanthropy.’
Indeed, Cook was surprisingly non-committal in response to a question about how long he expects to continue as CEO.
A few weeks ago, Cook was asked how long he foresees running the Cupertino, California-technology giant. “We’ll see,” he said. “At some point, of course, we all do something different.”
It’s possible that the awards could still prove effective despite Cook’s personal disinterest in the money: the more he makes during his tenure at Apple, the more he will have to donate to charities.
Photo: Karl Mondon/Bay Area News Group