Elon Musk, Chief Executive of Tesla Inc. is nearing the first earning of $346 million tranche in a record breaking pay package. This took place after the electric vehicle maker’s stock doubled in the last three months.
Tesla’s shares bolstered to a record high of 9% on Monday and require to rise to another 6% for Tesla’s stock market to reach value of $100 billion and then they can be sustained at the same level for one month to six month average. This will help to trigger the first 12 shares of options that will qualify Musk to buy Tesla stock. Musk has also successfully achieved an operational target required for the options to vest. For Musk’s following shares to vest under the 2018 term package, Tesla’s market cap requires to sustainably rise by $50 billion increment over 10 year’s agreement period. This will entitle Musk to the full package when Tesla’s market capitalization reaches $650 billion. He will achieve numerous other profit and revenue targets.
A full payoff for Musk will potentially exceed anything previously granted to U.S. executives. Musk however receives no cash or salary bonus. He only receives the options that belong to Tesla’s market cap and growth milestones. Musk has revolutionized Tesla from a niche car maker that suffered production problems to a global electric vehicle leader. It has managed to stay ahead of established rivals such as Volkswagen and BMW.
Last week Tesla’s stock market value had hit almost $89 billion by eclipsing sum of Ford’s and General Motor’s owing to surprise third-quarter profit for the first time. Musk had achieved two operational milestone last year by bagging revenue of $20 billion. He currently owns 34 million shares of Tesla which accounts for 19% of the company. If all his options are vested, the compensation package will authorize him to buy another 20.3 million shares.