Under the agreement, Chief Executive Officer Jagdeep Singh could receive stock options potentially value at as much as $2.3 billion, if the company meets various milestones, according to estimates by proxy advisory firm Glass Lewis. The package will be one of the key topics under consideration Wednesday at QuantumScape’s annual shareholder meeting.
“The disclosed dollar value cost of the grant is staggering,” Glass Lewis, which urged stockholders to reject the package, wrote in a recent report. Institutional Shareholder Services, another advisory firm, also opposed it.
Large pay packages are becoming increasingly common among fast-growing startups, particularly after the success of Tesla Inc unleashed a wave of cash in the electric vehicle market. Such pacts echo the compensation agreement that helped make Tesla CEO Elon Musk the world’s richest person, said Dayna Harris, a partner at executive compensation firm Farient Advisors. At least 15 corporate leaders received awards valued at $100 million or more last year, a threefold increase from when Musk received his in 2018.
“We strongly believe in setting challenging, hard-to-achieve goals, and then focusing efforts to make them happen,” QuantumScape wrote in a letter to shareholders defending the package. “This is why we based this new award on stretch goals and why we gave our key executives the ability to share in the upside in a way that is commensurate with the difficulty of achieving them.” Bloomberg
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