Nikola founder Trevor Milton agreed to forfeit up to roughly $166 million of equity as well as a two-year, $20 million consulting contract as part of his abrupt departure from the company he started. However, the EV executive gets to walk away with more than $3.1 billion in stock as part of a separation agreement reached over the weekend.
Milton, who’s come under scrutiny in recent days, agreed to give up his position and duties as executive chairman of the board as well as all other board seats on the company’s subsidiaries, according to the agreement dated Sunday. The deal strips the 39-year old entrepreneur of any say in the company’s operations and blocks him from attempting to influence any decisions for at least three years, according to a company filing with the Securities and Exchange Commission on Monday. Milton agreed to advise the company as an unpaid consultant on an ad hoc basis through the end of the year, but he cannot comment about the company on social media, blogs or other online platforms without legal approval from Nikola, according to the deal.
The value of his exit package will vary over time as the start-up’s shares have swung wildly since it went public on June 4. The agreement requires Milton to give up roughly 4.9 million in restricted, performance-based shares valued at $166 million as of Friday’s closing price of $34.19 a share while allowing him to walk away with more than 91.6 million shares that were worth over $3.1 billion.
Nikola declined to comment on Milton’s exit package.
The company also accelerated vesting on 600,000 restricted shares worth more than $20 million, allowing Milton to sell stock that was previously locked up until June 3, 2023 sometime within then next six months. Milton really didn’t give up much since the restricted shares he forfeited were contingent on the stock’s performance and his “continued service” at the company through that same date, so he would have lost that equity regardless, according to a separate securities filing.
Milton’s resignation sent shares of the company plummeting in premarket trading before opening at $24.97 – their lowest opening price since the company went public. Shares were trading down about 20% during trading midday Monday.