Tesla CEO Elon Musk earned the first part of his bonus package in record high. After agencies had calculated this at the beginning of May, the official confirmation came in the form of a Tesla stock exchange announcement: “One of the twelve tranches in its program has been released and can be exercised,” says a long document in preparation for the July general meeting.
Musk will have options to buy around 1.7 million Tesla shares at a price of $ 350.02 each. This is well below the current stock market price of just over $ 800, and the difference of around $ 770 million is the bonus for the CEO. However, he must first buy the shares and hold them for at least five years.
CEO earns more Tesla shares
The extensive program was presented in February 2018. Musk does not receive a fixed salary, but with increasing sales, profits, and stock market prices, he can secure options for up to 12 percent of the Tesla shares outstanding at the time, that is to say partially earn back his company.
The scope of the program for the Tesla boss is described as unprecedented, but also provides for demanding success criteria. When it was passed, the stock cost around the option price of $ 350. But for the first tranche now earned, Musk had to raise the Tesla price to a good $ 530 over an average of 30 and 180 days, so that the Tesla market capitalization is as planned at least $ 100 billion. There are also requirements for sales and profits.
Tesla is expected to reach $ 650 billion
After the introduction of this regulation, the Tesla share was little changed to weak for a long time. But in late 2019, an almost exponential surge started, which brought her close to $ 1,000 this year. But even at the current price of $ 800, the next stage of Musk’s program is within reach: For this, the market value, also over 30 and 180 days, must be at least $ 150 billion; at the close on Thursday, it was just over $ 149 billion.
So it goes on in steps of $ 50 billion in market value; Up to $ 650 billion, Musk can get another 11 options for 1 percent of Tesla shares outstanding in 2018. To do this, however, the ever-increasing requirements for sales and profits have to be met: For the full payment to Musk, Tesla would have to have $ 175 billion in sales (in 2019 it was $ 24.6 billion) and an adjusted profit before taxes, interest and depreciation of Get $ 14 billion.