(Bloomberg) -- Axon Enterprise Inc. shareholders approved the board’s plan to grant Chief Executive Officer Rick Smith an award that could yield him as much as $1.3 billion if the firm multiplies in size.
More than 66 percent of shares voted at Axon’s annual meeting Thursday supported the CEO performance award, a spokeswoman for the Scottsdale, Arizona-based company said in an email.
Under the terms of the award, Smith stands to receive as many as 6.37 million stock options, equal to 12 percent of the outstanding shares, that will vest if lofty goals for market value and either revenue or earnings before interest, taxes, depreciation and amortization are met. To receive all of them, the market value must roughly quadruple from Tuesday’s close and revenue and Ebitda grow more than fivefold. The grant expires in 2028.
The structure will ensure Smith “is motivated to generate long-term value for shareholders” and won’t have “incentives to engage in short-term measures,” Axon said in a filing announcing the grant. The CEO won’t receive a salary.
Axon, which sells Tasers, body cameras and software services for law enforcement, modeled the award on the mega-grant Tesla Inc. awarded CEO Elon Musk in March after a shareholder vote.
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