Elon Musk could bag another $32 billion in Tesla shares

Elon Musk could bag another $ 32 billion in Tesla shares

After electric car makers have reached about half of the goals set by the board, tech entrepreneurs are now vesting in stock options valued at that amount. With his groundbreaking 2018 reward packageAccording to a securities disclosure filed late Friday. Musk said in a separate securities filing last week that Tesla is ready to receive an additional $ 10.8 billion when it soon reaches other goals.

Tesla made the grant of stock options on 101.3 million shares three years ago, when Tesla’s shares traded at around $ 70 on a split-adjusted basis. As a result, Mr. Musk’s cost to exercise his 50.66 million vested options — or convert them into shares — is $ 70.01 apiece. Tesla shares closed Friday at $ 709.44.

In Friday’s securities filing, Tesla said the company had achieved six of 12 operating targets, and said two more were probable soon. Most of the targets reflected an adjusted version of earnings before interest, taxes, depreciation and amortization. Two represented revenue targets. Earlier this week, Tesla posted a record quarterly profit despite supply disruptions.

Tesla has also reached 11 of the 12 market capitalization targets for paid packages. It started at $ 100 billion and had intervals of up to $ 650 billion at $ 50 billion intervals. Each market capitalization milestone should be combined with an operational milestone that effectively acts as a limiting factor.

Tesla CEO Musk said that if Tesla continues to reach additional operating milestones, it will have about 40 million more stock options and the company’s market capitalization will exceed $ 650 billion. If you stay, the prize may be paid in full. 6 months. Tesla closed on Friday with a market capitalization of $ 649.82 billion.

Elon Musk’s optimism and affinity for grand claims that once undermined his credibility may have helped him to become the second wealthiest person in the world. The WSJ will look at how he succeeded in the pandemic. Photo: Britta Pedersen / Zuma Press

Mr. Musk does not accept salaries from Tesla and instead receives compensation through stock incentives. His wealth has a lot to do with investing in the company, whose market capitalization has skyrocketed as investors invested in electric car makers. As of December 31, Musk owns approximately 22.4% of the company’s outstanding shares, up from 20.8% in the previous year.

The billionaire used his Tesla holdings as collateral to borrow money. As of 2020, the CEO has promised to secure personal debt for more than 92 million of the 227 million Tesla shares, according to Filing. This is an increase from 18.5 million shares in the previous year. At the closing price on Friday, the pledged stock is worth about $ 65 billion.

Mr. Musk doesn’t like to sell stocks, although he sold some to cover past stock options taxes .. He told The Wall Street Journal in 2016 that he would never sell Tesla shares. Last year, Mr. Musk said he had sold three of his California mansions and sold most of his property. Executives later said he had moved to Texas— States that do not collect personal state income tax or capital gains tax.

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