The restricted stock units (RSU) awarded to Tim Cook, chief executive officer of Apple Inc. (NASDAQ:AAPL) in August of 2011 have been amended by the compensation committee of the board of directors of the tech giant, based on its latest regulatory filing with the Securities and Exchange Commission (SEC).

Apple Tim Cook

Apple Inc. (NASDAQ:AAPL) stated that the original grant date fair value awarded to Cook was not changed, but a portion of his future equity awards will be subject to “Total Shareholder Return,  a measure of the company’s stock performance and dividend in comparison with other corporations in the Standard & Poor’s data.”

The stock price of Apple Inc. (NASDAQ:AAPL) declined by more than 42 percent since reaching a record high of $705 per share in September last year under his leadership. He was given 1 million RSUs when the late founder and CEO, Steve Jobs, turned over his position to Cook in 2011.

According to Apple Inc. (NASDAQ:AAPL), Cook personally approached the board of directors of the company about applying performance metrics to the RSU’s awarded to him. The largest shareholders of the company expressed that it is “appropriate to attach a performance criteria” to the company’s future executive stock awards during their previous outreach discussions. In the past, the Apple’s stock awards to its executives were entirely time-based.

Apple’s Tim Cook Leading by Example

In its filing, Apple Inc. (NASDAQ:AAPL) wrote, “Mr. Cook is leading this initiative by example and has the full support of the Board of Directors. He asked the Committee to apply a performance metric to his outstanding 2011 CEO equity award as well as any potential future awards. After careful deliberation, the Committee has approved a modification to Mr. Cook’s 2011 award.”

“While the Committee generally believes that a performance-based award should have both a downside and an upside component, at Mr. Cook’s request, the modification does not contain an upside opportunity for over-achievement of these criteria. As a result of implementing a modification with only downside risk, the Committee has determined that a portion of the original grant should vest earlier than originally scheduled. This modification will not change the award’s original value for accounting expense purposes,” according to Apple.

Performance Metrics Now De Rigeur for All Apple Execs

The tech giant also stated that the performance metric will be applied to future stock awards for all its top executives starting last Friday.

After adopting the new performance metric, Cook’s 1 million RSUs, which should vest in a pre-determined time limit of ten years have been modified. Apple’s compensation committee said the two chunks of 100,000 RSUs that were set to best on August 24, 2016, and August 24, 2011 will remain.

The remaining 800,000 RSUs will be separated in ten equal tranches of 80,000 RSUs within ten years. According to the company, Cook requested the board of directors place 50 percent of his RSUs under performance criteria to set a leadership example.

The board of directors of Apple Inc. (NASDAQ:AAPL) said, “Because Mr. Cook faces only downside risk from the modification, the Committee believed that less than 50 percent should be placed at risk. Mr. Cook, however, expressed a strong desire to set a leadership example in the area of CEO compensation and governance and requested a larger at-risk percentage. Accordingly, the Committee is placing 50 percent of the RSUs at risk in each future annual performance-based tranche.”