In the wake of Steve Jobs’ most unfortunate and untimely passing, Apple in 2011 asked its acting Chief of Operations, Tim Cook, to replace his late and long-time confidant, and specifically tasked Cook with keeping the iPhone-maker at the forefront of success, innovation, and the technology industry as a whole. At the time, Cook allegedly signed a 10-year compensation package/contract that included up to 2.94 million shares of AAPL stock, plus salary based on performance, which would be distributed on key dates if Apple is able to meet or exceed its goals.
And so it seems, according to a report from The Guardian citing filings with the SEC, Cook just recently collected the bounty of his first big payday as the top boss of Apple: a whopping $89.6 million heap of cash, resulting from his offloading of some 560,000 shares of Apple stock.
About half of those shares were granted to Cook simply because he stayed on the job at Apple for the last five-years; while the other half (somewhere around 280,000 shares) were granted based on the company’s persistently positive shareholder returns over the past three-years running. Cook’s shares were reportedly valued at the closing price on Thursday, August 24th, which was $159.27 apiece.
According to the terms of his original contract, Cook’s compensation package spans a 10-year period of time, from its signing in 2011 through 2021, and includes 2.94 million shares of AAPL plus salaries and bonuses, as deemed fit by the board. So long as he remains the top boss at Apple and growth remains steady, Cook will receive an additional 560,000 shares annually, through August, 2020, while the final load of 1.26 million shares will come his way in August, 2021, at the close of his contract.
Interesting and worth noting is that while he’s also paid a pretty descent salary for his work at Apple, the majority of Cook’s (and other executive compensation) comes in the form of restricted stock units (RSUs), which are essentially whole-value shares of AAPL stock that will be redeemable for their cash value on a future date. Cook’s original package, inked in August 2011, was valued at around $376 million. However since Apple has been performing quite well under Cook’s leadership, the estimated value of his package has already climbed to a whopping $480 million — based on Wednesday’s closing price of $163.35/share.
The moral of the story is that if Apple continues beating expectations and shattering profit-ceilings from here on out, Cook’s ultimate fortunate could rise far, far higher. Of course, that’s all just mud in the bucket to him, as Cook, much like his other tech executive pals, has pledged he’ll be donating the majority of his Apple fortune to charity.