--CEO pay package includes higher salary but no additional stock awards
--A handful of executives receive large restricted stock packages
--Former executive Scott Forstall not mentioned in proxy statement
(Adds details and context throughout.)
By Ben Fox Rubin
Apple Inc. (AAPL) Chief Executive Timothy Cook received an estimated $4.2 million in compensation in 2012, nearly 99% less than he got last year, when he topped the list of highest-paid CEOs.
Mr. Cook's pay package for 2011 was valued at about $378 million, thanks largely to an award of one million restricted Apple shares. The grant, made when the stock traded around $376 a share, was intended to retain Mr. Cook as CEO because half of the award vests in 2016 and the remainder in 2021. Since the award, the company's shares have risen by more than a third.
According to a regulatory filing Thursday, Mr. Cook's salary rose to $1.4 million in 2012 from $900,000, but he received no stock awards this year, resulting in the much-smaller pay package. The company explained Mr. Cook didn't receive stock this year because of the large award he got when he was promoted to CEO.
The rest of Mr. Cook's 2012 compensation came primarily from $2.8 million in performance-based bonuses. Apple said the company exceeded the maximum performance goals for both net sales and operating income set by its compensation committee for 2012. As a result, each executive officer received the maximum payout of twice the person's base salary under the bonus plan.
In addition, four top executives at the technology company received large stock awards this year. The company explained in its Securities and Exchange Commission proxy statement that it recently adopted the practice of granting large restricted stock awards to certain executives every two fiscal years, creating sharp swings in pay packages from year to year.
However, Scott Forstall--the company's controversial former mobile-software head, who was asked to leave Apple in October--wasn't mentioned in the proxy statement, leaving investors to wonder what, if any, severance package he may have received.
Following the company's stated practice, Mr. Forstall would have been scheduled to receive a large stock award in 2012, as his total compensation was valued at $1.4 million in 2011 and $29.6 million in 2010. Mr. Forstall left Apple following heavy criticism over the company's new mobile-mapping service, which contained numerous errors and was a rare product snafu for the company.
An Apple representative wasn't immediately available for comment.
In 2012, Chief Financial Officer Peter Oppenheimer's compensation ballooned to $68.6 million from $1.4 million last year, as his pay package included $66.2 million in stock awards.
Bob Mansfield, the company's hardware chief, received compensation valued at $85.5 million this year, nearly all of it from stock awards. Mr. Mansfield told the company in May that he intended to retire, which resulted in changes made to the vesting dates of his previously granted stock awards, but he was coaxed out of retirement by Mr. Cook later in the year.
Other executives benefiting from large stock awards included Bruce Sewell, general counsel and secretary, who received total compensation of $69 million, up from $1.4 million, and Jeffrey Williams, senior vice president of operations, who got $68.7 million in all.
As part of the proxy statement, Apple nominated all eight of its current directors to continue on the board. Also, a shareholder proposed the creation of a board committee on human rights, in response to concerns about working conditions at Apple's suppliers. The company's board recommended voting against the proposal by noting what Apple already does in this area and arguing such a committee would distract the board from its other responsibilities.
Apple's shares, up 25% in 2012 despite a recent selloff, slid 1.4% Thursday to $505.76 in a broad market decline.
Write to Ben Fox Rubin at [email protected]
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