Apple 2012 Annual Report Download - page 67

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401(k) Plan
The Company’s 401(k) Plan (the “401(k) Plan”) is a deferred salary arrangement under Section 401(k) of the
Internal Revenue Code. Under the 401(k) Plan, participating U.S. employees may defer a portion of their pre-tax
earnings, up to the IRS annual contribution limit ($17,000 for calendar year 2012). The Company matches 50%
to 100% of each employee’s contributions, depending on length of service, up to a maximum 6% of the
employee’s eligible earnings. The Company’s matching contributions to the 401(k) Plan were $114 million, $90
million and $72 million in 2012, 2011 and 2010, respectively.
Restricted Stock Units
A summary of the Company’s RSU activity and related information for 2012, 2011, and 2010, is as follows:
Number of
RSUs
(in thousands)
Weighted-
Average
Grant
Date Fair
Value
Aggregate
Intrinsic
Value
(in millions)
Balance at September 26, 2009 ................................... 12,263 $122.52
RSUs granted ............................................. 6,178 $214.37
RSUs vested ............................................. (4,685) $119.85
RSUs cancelled ........................................... (722) $147.56
Balance at September 25, 2010 ................................... 13,034 $165.63
RSUs granted ............................................. 6,667 $312.63
RSUs vested ............................................. (4,513) $168.08
RSUs cancelled ........................................... (742) $189.08
Balance at September 24, 2011 ................................... 14,446 $231.49
RSUs granted ............................................. 7,799 $431.35
RSUs vested ............................................. (6,305) $205.27
RSUs cancelled ........................................... (935) $256.01
Balance at September 29, 2012 ................................... 15,005 $344.87 $10,010
The fair value as of the respective vesting dates of RSUs was $3.3 billion, $1.5 billion and $1.0 billion for 2012,
2011 and 2010, respectively. The majority of RSUs that vested in 2012, 2011 and 2010 were net-share settled
such that the Company withheld shares with value equivalent to the employees’ minimum statutory obligation
for the applicable income and other employment taxes, and remitted the cash to the appropriate taxing
authorities. The total shares withheld were approximately 2.3 million, 1.6 million and 1.8 million for 2012, 2011
and 2010, respectively, and were based on the value of the RSUs on their respective vesting dates as determined
by the Company’s closing stock price. Total payments for the employees’ tax obligations to taxing authorities
were $1.2 billion, $520 million and $406 million in 2012, 2011 and 2010, respectively, and are reflected as a
financing activity within the Consolidated Statements of Cash Flows. These net-share settlements had the effect
of share repurchases by the Company as they reduced and retired the number of shares that would have otherwise
been issued as a result of the vesting and did not represent an expense to the Company.
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