Entrepreneur Elon Musk has no regular salary. A good decision – because a fixed income could hardly keep up with the current success bonus that he earned. And that is just the beginning.
The successful series of the US electric car maker Tesla gives CEO Elon Musk a big payday. Musk has earned the hundreds of millions of dollars in the first trench of a highly endowed long-term compensation plan, which is linked to the achievement of certain targets, such as the market value or Tesla’s sales performance. This was announced by the company on Thursday (local time) to the SEC.
The first trench comprises 1.7 million Tesla shares, the last closing price of which was just under $806 or 40,657 Philippine peso and which Musk could now purchase at the option price of $350 or P17,655 Philippine peso. The difference would result in a book profit of approximately $775 million or 39,093,356,000 Billion Philippine peso. However, Musk must hold the papers for at least five years, until then the course could be somewhere else.
The Tesla CEO does not receive a regular salary, but benefits greatly if the group meets certain requirements. At Musk’s contract extension for another ten years as chief executive, around twelve targets were agreed in steps of $50 billion for the market value in early 2018. In fact, Tesla managed to achieve a market cap of more than $ 100 billion on a permanent basis, and recently it was almost $ 150 billion.
So far, it’s just the first step in an ambitious plan that is set to push Tesla’s market value up to an enormous $650 billion. In this case, the 48-year-old could theoretically even raise up to $2.6 billion. However, there is also a high risk that Tesla will miss the performance brands. As the largest single shareholder, who already holds a stake of around 18.5 percent in the e-car maker, Musk’s assets depend either way on the fate of the group.