Elon Musk might be closer to a whopping $700 million payday despite saying Tesla’s stock price was too high on his Twitter profile last week.
The Tesla CEO comments prompted share prices to plummet by 13 percent last Friday but values jumped by more than 8 percent on Monday, putting the company’s capitalization at $141.1 billion at the close, Reuters reports.
Read More: Elon Musk Says Tesla’s Stock Price Is “Too High”, Prompting 13% Drop
But the key thing here for Musk is that Tesla’s market value has reached a six-month average of $100.2 billion, which triggers the vesting of the first of 12 tranches of options given to the company’s CEO as part of a pay package signed in 2018. Elon Musk has already achieved two other requirements by exceeding a one-month average of $100 billion market value for Tesla and hitting a predetermined growth target.
With each tranche achieved, Musk gets the option of buying 1.69 million Tesla shares at $350.02 each, which means that he could in theory make a profit of $694 million by selling the shares at their closing $761.19 price.
Musk doesn’t receive a salary or bonus from Tesla as the company’s CEO, and he’s only eligible for options that vest based on the company’s market value and hitting specific milestones for revenue and profit growth.
Back in 2018, Tesla said that Musk could reap as much as $55.8 billion if they didn’t issue any new shares. However the company did issue shares as compensation to employees since then. Despite that, a full payoff of all tranches would result into the biggest pay for any U.S. executive in modern history.
The full pay package will of course unlock only if Tesla’s market capitalization reaches $650 billion and the company manages to hit several revenue and profit targets.
