Big payday for Elon Musk as Tesla CEO notches ludicrous stock award

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  • Elon Musk is now vested in Tesla (NASDAQ:TSLA) stock options valued at $32.4B after the company hit roughly half of the targets laid out by the board in his landmark 2018 compensation package, WSJ reports, citing a weekend 10-K filing.
  • Behind the math: "Six of the 12 tranches under the 2018 CEO Performance Award, corresponding to options to purchase an aggregate 50,660,105 shares of Tesla's common stock, have vested and become exercisable, subject to Mr. Musk's payment of the exercise price of $70.01 per share and the minimum five-year holding period generally applicable to any shares he acquires upon exercise." TSLA shares closed at $709.44 on Friday.


  • The EV maker achieved six of 12 operating targets, which mostly reflected an adjusted version of EBITDA, and two more were probable soon. Tesla also reached 11 of the pay package's 12 market-capitalization targets - which started at $100B and were spaced at $50B intervals up to $650B - however, each market cap goal must be paired with an operating milestone.
  • Musk could still gain stock options on another 40M shares if Tesla continues to meet additional operating milestones, and the award could pay out in full if the company's market cap rises above $650B for six months.
  • Fine print: Musk, who doesn't accept a salary from Tesla and instead is compensated with stock awards, has until 2028 to exercise the options and must hold the shares for five years.
  • Loup Ventures continues to think Tesla is on the right path for long-term success, citing sufficient amount to fund the company's aggressive delivery growth target, as well as significant in manufacturing and engineering.

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