By Ross Kerber
April 28 (Reuters) – SpaceX’s board has approved a compensation plan for founder Elon Musk with goals as futuristic and celestial as the company’s ambitions: colonizing Mars and running data centers in outer space.
The details of Musk’s sweeping pay package, which have not been widely reported, were revealed in the company’s confidential registration statement filed in recent weeks with the Securities and Exchange Commission and reviewed by Reuters last week.
The lofty rewards dangled for Musk by SpaceX show the challenge of holding the attention of the serial entrepreneur as he prepares to take the rocket maker public. They also potentially set up SpaceX investors for tensions with shareholders of Tesla, where Musk is CEO, say corporate governance experts.
Connecting science-fiction visions with accounting commitments, the SpaceX board in January approved a pay package for the world’s richest man that will award 200 million in super-voting restricted shares if the company hits a market value of $7.5 trillion and establishes a permanent human colony on Mars with at least 1 million people, according to excerpts from the company’s registration statement reviewed by Reuters.
His Mars-shot performance package also gives him as many as 60.4 million in restricted shares awarded on March 23 if SpaceX meets separate valuation goals and operates data centers in space that provide at least 100 terawatts of compute capacity – a colossal amount of power equal to 100,000 gigawatts, or about 100,000 one-gigawatt nuclear reactors running all at once. Both awards come with super-voting Class B restricted stock, which carries 10 votes to every 1 Class A share, and vest in tranches as the company’s value rises.
CONDITIONAL REWARDS, STOCK OPTIONS
However, he will not receive a single share if the company fails to reach the board’s lofty valuation targets, which are not tied to a specific timeline other than his continued employment. He has received a nominal salary from SpaceX of $54,080 per year since 2019.
The value of the pay package could not be determined since SpaceX is privately held. SpaceX is targeting an initial public offering around the time of Musk’s birthday on June 28, which could value the company at some $1.75 trillion, Reuters has reported.
As of December 31, he held 68.8 million in previously awarded Class B stock options with a strike price of about $42 that expire in 2031, allowing Musk to pocket any profit above that amount if he exercises the options before that date.
