Musk does not receive a salary, but the company approved in 2018 granting him various options as payment.
Photo: TOBIAS SCHWARZ / AFP / Getty Images
However Musk could become the richest man on the planet since the company Tesla approved in 2018 a payment package that could give you 20.3 million purchase of shares that would be delivered in 12 equal payments that could turn it into the richest person in the world.
Thanks to the actions of Tesla have risen exponentially, Musk has qualified for two types of options that on paper have a value of about $ 2.8 billion each after paying the exercise price. Musk would be about to qualify in a third tranche of options that would have an additional value of $ 2.8 billion.
In order for the CEO of Tesla to receive the options, the company will have to achieve a series of objectives both in financial results and in the market value of the company’s shares.
One of those conditions for these options to be exercised is that Tesla shares must maintain a median market value of $ 200 billion for the previous six months, an objective that has been achieved during the last 5 months. Only at the close of Monday the shares of Tesla (TSLA) were valued at $ 372 billion.
Another condition for Musk to receive the options is that the company’s profits must exceed $ 4.5 billion. The company almost made a profit of $ 4.4 billion in June. The earnings forecast for the third quarter of the year is expected to be $ 1.4 billion, a third more than what the firm earned during that same date last year.
So far Musk has not exercised any of the options he has received during the year or those he received in previous years. Options are generally exercised only when the investor who owns them is ready to sell them or if they are about to expire.
Elon musk owns 34 million shares, a share equivalent to about 18% of the company which is valued at $ 68 billion dollars.
At the beginning of August the price of the company’s shares raised the value of that block of shares to $ 2.1 billion. As stocks continue to rise, so will the potential value of payment options that according to CNN would have a present value as a whole of $ 8.4 billion.
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