Tesla's CEO, Elon Musk, transferred ownership of £22 billion worth of shares in an effort to prevent his departure from the electric vehicle company.
Elon Musk's New Compensation Package from Tesla
Elon Musk, the largest shareholder of Tesla with a 12.7% stake, has been awarded a new compensation package by the company. The package, valued at approximately $29 billion, is part of a legal battle over his previous compensation plan.
The new package includes 96 million restricted shares of Tesla stock, with a strike price of $23.34 per share. Given the current stock price of around $309 per share, the built-in value of each share is approximately $280. The shares will vest on the second anniversary of the grant, expected to be in early August 20227, provided Musk continues to serve as either CEO, chief of product development, or operations for the entire period.
Musk cannot sell any vested shares until five years from the date of the award, which is August 3, 2030. This package is considered an 'important first step' in compensating Musk for his extraordinary work.
The share price of Tesla's stocks rose by 2.2 per cent following the announcement. Daniel Ives, an analyst at Wedbush Research, believes the package will keep Musk as CEO of Tesla at least until 2030.
The commission does not affect the editorial independence of the platform recommendations provided by AJ Bell, Hargreaves Lansdown, interactive investor, InvestEngine, and Trading 212. It's important to note that the article does not discuss the implications of Musk forgoing the £22billion package for Tesla's future.
The article also does not provide information on how the commission is earned or the specific terms of the commission. Furthermore, it does not discuss the current legal battle between Musk and Tesla over the £42 billion pay award granted to Musk in 2018.
Retaining Elon Musk is considered crucial for Tesla, particularly as the company shifts towards AI and self-driving robo-taxis. However, the ruling does not seem to affect Musk's role as CEO or his significant stake in the company.
[1] Source: BBC News [2] Source: The Guardian [3] Source: Reuters
- The new compensation package, consisting of $29 billion worth of Tesla stock, is a significant step in financing Musk's continued involvement in the company's business, particularly as it delves into technology like AI and self-driving robo-taxis.
- As part of this compensation, Musk is restricted from selling any vested shares until August 2030, demonstrating Tesla's commitment to finance Musk's crucial role in the company for the next decade.
