SolarCity’s CEO and CTO have asked that their annual salaries be slashed to $1 as part of the restructuring process.
In order to bring its expenses in line with its reduced installation outlook, SolarCity Corp has disclosed that it would cut down on its operating costs, including a cut in the pay of its chief executive.
The company has disclosed that its CEO, Lyndon Rive and his brother, Chief Technology Officer Peter Rive, have asked that their annual salaries be slashed to $1 from $275,000, as part of the cost-cutting plans.
The move comes in the wake of Tesla Motors accepting to acquire Solar City for $2.6 billion.
According to information available as per a regulatory filing, the compensation committee of the company’s board of directors have agreed to slash their salaries.
“It’s a symbolic gesture, but it’s appropriate,” said Pavel Molchanov, an analyst with Raymond James.
Incidentally, the CEO of SunPower Corp, SolarCity’s rival, has also slashed his salary and bonus to $1, for the rest of the year as part of a broader restructuring.
In the second half of this year, SolarCity is expected to incur restructuring charges ranging from $3 million to $5 million, most of which will be spend on severance benefits.
SolarCity did not immediately respond to requests for further details on the restructuring plan.
Earlier this month, for the second time SolarCity had changed its forecast citing lower residential bookings.
Last year, SolarCity had city that it would pace its growth rate and focus on generating a steadier cash flow. Its stock price has slumped by more than 60% since December.
In another filing, SolarCity has disclosed that it will issue $124 million in bonds which will carry an interest rate of 6.5% – it’s highest ever offering. They will also have a maturity date of 18 months.