TeslaTesla, Inc. 's share price rose sharply on Monday, with a market capitalization approaching $100 billion, while under the previous salary incentive package, if Tesla, Inc. 's market capitalization reached $100 billion and met the relevant requirements, his CEO Musk would receive a stock award worth nearly $1 billion.
According to Musk's compensation plan for the next 10 years approved by Tesla, Inc. 's special shareholders' meeting on March 21, 2018, Musk's salary will be about 20.3 million stock options linked to Tesla, Inc. 's market value and operating performance. It accounts for about 12% of the outstanding shares on January 19, 2018, without any other cash wages and incentives.
Tesla, Inc. 's market capitalization requirements are divided into 12 levels, the first level is US $100 billion, and then each tier increases by US $50 billion, with a maximum of US $650 billion. Operating performance is divided into two aspects: revenue and profit before interest, tax, depreciation and amortization. Each aspect has eight levels, with the lowest revenue of $20 billion and the lowest profit of $1.5 billion. After the market capitalization reaches the requirements of each level, as long as 16 of the operating results reach one, Musk will receive a stock award of about 1.69 million shares, but each of the 16 requirements can only match the market capitalization once.
Tesla, Inc. 's revenue reached $21.461 billion last year, exceeding the minimum of $20 billion required by the incentive plan, and after the production and delivery of electric vehicles reached record highs, there is little doubt that this year's revenue exceeded $20 billion. So Musk's only obstacle to getting a stock award is Tesla, Inc. 's market capitalization.
Tesla, Inc. shares rose a further 2.5 per cent to $537.92 on Tuesday, after surging $46.71 on Monday and pushing shares above $500for the first time.
In terms of stock price, Tesla, Inc. 's market capitalization is more than $100 billion, the share price needs to be more than $554.82, which means a further increase of $16.90 from Tuesday's closing price.
If Tesla, Inc. 's market capitalization exceeds $100 billion and lasts long enough to meet the requirements, Musk will receive a stock award of about 1.69 million shares. At a share price of $554.82 required for a market capitalization of $100 billion, 1.69 million shares are worth nearly $938 million.