Apple Inc. (NASDAQ:AAPL)’s newly promoted executives will now have more incentive to stay in the company for a long time. The incentive is in the form of a hefty stock bonus that requires a stay with the company for at least four years.
According to the latest filings with the U.S. Securities and Exchange Commission, Craig Federighi, Apple’s senior vice president of Mac Software Engineering, and Dan Riccio, Apple Inc. (NASDAQ:AAPL)’s senior vice president of Hardware Engineering, have been allotted 75,000 shares of company as part of their promotions last week.
Both Federighi and Riccio were promoted to Apple’s Executive Team in late August. The SEC filing also said that a board member, Mickey Drexler, who is also the chairman and CEO of J. Crew, sold 25000 Apple Inc. (NASDAQ:AAPL) shares worth approximately $16.6 million. Also in March, Apple CEO Tim Cook, CFO Peter Oppenheimer, and SVP Phil Schiller, each earned a total of approximately $150 million from sale of stocks granted in 2008.
With the current market price, the stocks awarded to the newly promoted executives are worth $50.62 million, vest at three separate points over the next four years, the first being a batch of 25,000 on Dec. 23, 2013, while the remaining units will vest equally on Apr. 23, 2015 and Aug. 23, 2016.
Awarding such hefty incentives is not new for the iPhone maker. Last year, in November, Apple Inc. (NASDAQ:AAPL)gave away 150,000 shares each to most of its senior vice presidents. Eddy Cue, short of SVP, received 100,000-share as bonus. At that time the incentive in the form of stocks amounted to $60 million for those who got 150,000 shares, and $40 million for those who received 100,000 stocks.
This form of incentive has been common among the firm, such packages motivate the executives to stay with the company and improve its performance, in return for a big payoff when the lock up period expires.