Apple chief passes on US$75 mil. stock payout

AFP and AP

SAN FRANCISCO — Apple Chief Executive Tim Cook has opted not to take US$75 million in dividend payout on restricted shares of stock he owns in the maker of iPhones, iPads, iPods and Macintosh computers. Assuming Apple pays quarterly dividends of US$2.65 over the vesting period of Cook’s shares, the company said he will give up about US$75 million in value. Documents on file with the U.S. Securities and Exchange Commission (SEC) on Friday said that while other Apple employees will be awarded quarterly “dividend equivalents” of US$2.65 on restricted shares, Cook asked not to be included.

Cook has 1.125 million shares of restricted stock in the process of vesting, making him eligible for about US$75 million in dividend value, according to the SEC filing. Restricted shares typically don’t qualify for dividends, so the decision by Apple’s board amounts to bonuses for employees of the Cupertino, California-based company. The decision comes two months after Apple introduced a regular dividend and authorized a US$10 billion stock buyback program to start giving some of its cash hoard back to shareholders. It was a move that former CEO Steve Jobs long resisted. After his death last year, Apple’s management has signaled that it’s been considering options for the money, which amounted to nearly US$100 billion.

Even without the dividend, Cook, 51, remains one of the highest-paid CEOs in America. His pay package was valued at US$378 million when he became Apple’s chief in August. That was almost entirely in stock awards, some of which won’t be redeemable until 2021, so the value could change dramatically.

Cook earned US$900,000 for his annual salary and US$900,000 for his annual incentives. But he scooped up a cool US$376 million in restricted stock grants, based on Apple’s stock price at the time. Apple’s coffers continued to swell in the first three months of the year due to record sales of iPhones and iPad tablet computers, particularly in China and other parts of Asia. Apple reported that it made a profit of US$11.6 billion on revenue of US$39.2 billion in the quarter ended March 31. The amount of cash Apple had on hand grew US$12 billion to US$110.2 billion. Its long streak of blockbuster earnings prompted Apple in March to announce it will begin paying quarterly dividends and buying back stock. Shares of Cupertino, California-based Apple fell US$5.84 to US$559.48 in midday trading Friday. The stock has traded between US$310.50 and US$644 over the past year.