What would happen if the charismatic CEO responsible for the 2009 Tesla Roadster -- the most sexy electric sports car to hit the roads of the U.S. this century -- were to leave the Silicon Valley startup company he co-founded?
Now we know: The possibly less-sexy, less-charismatic, less-electrified executives of Tesla's investor Daimler will have to approve someone they feel fit to run the company.
Tesla's lawyers publicly submitted documents to the Securities and Exchanges Commission (SEC) on May 27 as part of preparations into its forthcoming initial public offering (IPO). The document details part of the agreement which outlines the future of the Tesla-Daimler partnership, including what would happen if Elon Musk, Tesla's high-flying CEO were to leave the company before the launch of the 2012 Model S seven-seat all-electric sedan.
On page 42 of one of the long Tesla documents found online at the SEC website Tesla discloses the details of what exactly would happen if Musk left the company prior to December 31, 2012.
"In addition, our financing agreements with Blackstar contain certain covenants relating to Mr. Musk's employment as our Chief Executive Officer. These covenants provide that if Mr. Musk is not serving as our Chief Executive Officer at any time until the later of December 31, 2012 or the launch of the Model S, Mr. Musk shall promptly propose a successor Chief Executive Officer and Dr. Kohler, or his successor, must consent to any appointment of such person by our Board of Directors."
Toyota-Tesla press conference, Palo Alto, California, on May 20, 2010
The document also details that Daimler AG must agree to any takeover deals and acquisitions. The recent Tesla-Toyota announcement that they plan to work together to build a $30,000 electric car at the former NUMMI plant in California is likely to have been overseen, or at least sanctioned, by Daimer.
Tesla's partnership with Daimler seems unaffected at the moment by the announcement from Daimler last week that it will partner with Chinese EV firm BYD to develop a new brand of electric vehicles for the Asian market.
However, the documents released as part of the IPO preparation work hint that Tesla could reserve the right to cancel the agreement if it wishes when a partner company enters into a collaboration with a rival firm. This option is possible for either company to execute now that Tesla and Toyota are working together.
2010 Tesla Roadster Sport
Other interesting details outlined in the Tesla IPO documents include the number of hours Elon Musk has spent in the air in the past year on official Tesla business -- 518 hours of air travel on 189 separate trips if you like to count that kind of thing.
Until the middle of 2009, Mr. Musk financed the cost of running his own private jet to make these trips but now shares the expenses incurred on Tesla business flights with Tesla. The company argues in the IPO documents that Musk couldn't possibly waste time flying charter and thus needs his own private jet -- hardly as environmentally friendly as the sexy sportscar Tesla is so famous for.
Musk's salary is on par with Apple's CEO Steve Jobs at just $1 a year. Of course, his extensive share options will ultimately reward him with much more, and as many sexy electric sportscars as he can possibly want.
[examiner.com][SEC]
