Apple CEO Tim Cook on Wednesday unveiled a new incentive program for employees, making them eligible to earn Restricted Stock Units (RSUs). Normally, the company gives RSUs only to top management and executives from the product teams to retain talent. Now, other employees will also be eligible to receive stock grants, including those in retail and on the AppleCare teams.
In addition to ESPP
According to 9to5Mac, the Apple Inc. (NASDAQ:AAPL) CEO Tim Cook announced the program in an email sent out yesterday to all the company employees. “This year, I’m excited to let you know that the Executive Team has created a new program for stock ownership through RSU grants. It’s designed to reach employees who were not previously eligible, including many in our amazing retail and AppleCare teams,” Cook said the email.
Apple CEO told that all those employees not covered by other RSUs programs will now be covered under the new program. Cook said it is an unusual step taken by the company, and is “very special — just like our team.”
Apple already had ESPP (Employee Stock Purchase Plan), which allow the company employees to acquire Apple stock at a discount, but under the RSU program, the company’s stock is given as a form of compensation.
Cook to gain big if Apple performs well
Typically, RSUs vest over a period of many years, thus, motivating employees to stay at the company. For example, if Cook stays with the company until 2021, he will receive a total of 1,000,000 shares provided Apple performs well. Cook will also earn 100,000 RSUs in August 2016, 100,000 in August 2021, and an additional 800,000 RSUs divided over 10 years as long as the total shareholder return for Apple is in the top three among the S&P 500 companies.
Cook said that people are the most important resource for a company, and this new incentive program is just another way of saying thanks. Cook thanked the firm’s employees for the many contributions they had made, and “Working with all of you is the privilege of a lifetime.”
As of around 9.53 am EDT Thursday, Apple shares were up 1.58% at $111.96. Year to date, the stock is down almost 1% while over the last year, shares are up almost 15%.