As the world's largest company with a market cap of more than half a billion dollars, Apple Inc. [AAPL] is sitting on a large pile of cash upwards of $100 billion and decided Monday to institute a $2.65 a share quarterly dividend and buy back $10 billion in stock, the tech behemoth announced today.

The $2.56 per share dividend, which the company noted is subject to declaration by Apple's board, will start sometime in the fourth quarter of Apple's 2012 fiscal year, which starts July 1.

The dividend plan marks the first time in 17 years that the Cupertino, Calif.-based Apple is returning cash to investors in the form of a dividend.

Apple shares were up about 1.3 percent to $593.22 a share  at 10 a.m. Monday, some one hour after the announcement.

Apple's board has also authorized a $10 billion share buyback program that will start in the company's next fiscal year, which begins Sept. 30, 2012.

We have used some of our cash to make great investments in our business through increased research and development, acquisitions, new retail store openings, strategic prepayments and capital expenditures in our supply chain, and building out our infrastructure. You'll see more of all these in the future, Apple CEO Tim Cook said in a statement. Even with these great investments, we can maintain a war chest for strategic opportunities and have plenty of cash to run our business. So we are going to initiate a dividend and share repurchase program.

The share buybacks are expected to be conducted over three years. Apple said the main goal of the program is neutralizing the impact of dilution from future employee equity grants and employee stock repurchase programs.

Apple CFO Peter Oppenheimer said about $45 billion of the company's more than $100 billion in cash will be used for the dividends and share repurchasing programs.

We are extremely confident in our future and see tremendous opportunities ahead, Oppenheimer said in a statement.

A live stream of a conference call announcing the plans is underway now. If you can't access the conference call, Apple is replaying the web cast for two weeks at www.apple.com/quicktime/qtv/call31912.