SpaceX sets course for one Musk rule

Julie Morgan· Host0:00

[instrumental music] Welcome to Seeking Alpha's Wall Street Breakfast, where we cover the top news for investors every morning. It's good to be with you on this Thursday, May 7th. I'm Julie Morgan. SpaceX has reportedly adopted corporate governance policies that will give its CEO sweeping authority and limit shareholder rights when it goes public. According to Reuters, the rocket maker is using super voting shares, mandatory arbitration, stricter rules on shareholder proposals, and Texas corporate law to give Elon Musk and other insiders board control. SpaceX also limited investors' ability to challenge management, sue in court, enforce votes on governance issues. And Musk can only be fired as CEO and chairman of the board by the vote of Class B shareholders, referring to the super voting shares. Class B shareholders will have 10 votes for every Class A share available to everyday investors. Only Musk, his family, and certain entities will be eligible to receive Class B stock. These shares will allow the CEO to retain more than 50% of voting power after SpaceX goes public, meaning his removal from the board would effectively require a self-vote. He currently has 42 and a half percent of SpaceX's equity and 83.8% of the voting control. But these policies may not deter investors