SpaceX has a big IPO coming up, but the next step might be a merger of SpaceX and Tesla. And if so, it could be a backdoor to triggering Elon Musk’s trillion-dollar pay package automatically, without having to meet any of the operational milestones, thus diluting everyone’s shares without delivering on the promises that were made.
Late last year, Tesla shareholders voted on the largest CEO pay package ever, orders of magnitude higher than the second-largest ever (which was also for Musk, and also an order of magnitude larger than the third-largest).
The package was utterly ridiculous in its design, but the marketing effort put on by Tesla to convince shareholders to vote for it succeeded, and the measure passed. Despite that it will dilute shareholders and retain a bad CEO who has overseen – er, uh, been distracted by being racist on twitter during – the company’s falling sales, enough reasonable people seem to have already sold their shares that the ones who remain were gullible enough to make this bad decision.
But the package did have one redeeming quality to it. It was designed in such a way that it was split into 12 tranches of stock, and each tranche had increasingly difficult performance milestones attached that would require the company to grow not just by market cap, but in its operations.
