Axon CEO Rick Smith relinquishes salary for ten-year performance plan
Axon announced a ten-year CEO performance award for CEO and founder Rick Smith tied to achieving market cap and financial performance milestones. For the award to fully vest, Axon's market cap would have to grow ten-fold from recent levels to $13.5B, and key revenue and profitability goals would also have to be achieved. The award is modeled after the recently announced 2018 Tesla CEO compensation plan for Elon Musk. Smith will not receive a salary or cash bonus, nor any new equity compensation that vests automatically with the passage of time. The performance award consists of a ten-year grant of stock options that vests in 12 tranches. Each of the 12 tranches vests only if a pair of milestones are both met. The first set of milestones are based on Axon's six-month average market cap with the first milestone at $2.5B, nearly double the average today. For each of the remaining eleven milestones, Axon's market cap must continue to increase in $1B increments. For the full award to vest, Axon's market cap must increase to $13.5B. To meet the financial performance milestones, Axon must achieve a set of escalating revenue or adjusted EBITDA targets. Revenue milestones start at approximately two times current levels and adjusted EBITDA milestones start at approximately three times current levels. The award's effectiveness is subject to the approval of Axon's shareholders, who will vote on it at the Axon Annual Stockholder meeting on May 24.