SolarCity Corp. awarded co-founder Lyndon Rive a $77 million stock option award that looks just like the one his cousin Elon Musk received at Tesla Motors Inc. in 2012.
Rive has ten years to earn as many as 3 million stock options with an exercise price of $48.97 according to the filing. He can do so by achieving pairs of goals, with half tied to SolarCity’s stock price and half tied to operational goals such as increasing customers, and lowering the cost of generating solar wattage. Every time he achieves a pair, he earns one-tenth of the options.
SolarCity declined to comment beyond the filing, said Jonathan Bass, a spokesman for the San Mateo, California-based company.
Those terms are nearly identical to ones given to Musk, who is SolarCity’s chairman and biggest shareholder, at Tesla, the electric carmaker he founded. He’s earned 50 percent of the 5.27 million Tesla options granted to him in 2012 as its market capitalization has grown and it brought an electric crossover sports utility vehicle, the Model X, to market. If Musk achieves all his Tesla goals, the options would be worth $1.6 billion.
Rive hasn’t yet earned any of his options, according to SolarCity’s proxy. While the company has achieved two operational goals, it needs to bring its stock price to $84.07 before he earns one-tenth of the options. SolarCity closed at $33.87 on Thursday. Rive will only receive all the options if he achieves all operational goals and the company rises to $400 per share. If exercised at that price, the 3 million options would be worth $1.05 billion, according to data compiled by Bloomberg.
Lyndon Rive’s brother Peter, who is SolarCity’s chief technology officer and co-founder, is eligible for 2 million options under the plan.