The proposal, made in 2018, fell like soup in honey. To reassure shareholders who thought he was earning too much, Elon Musk offered to work for free. But with an incentive plan that would lead Tesla to have to pay a very generous premium for objectives, more precisely whenever the market valuation made a jump of 50 billion dollars, something that nobody thought possible. Nobody, except Musk himself, Tesla's CEO.
Musk's goal reward scheme
The deal was negotiated at a time when it seemed unlikely that Tesla's market value would exceed that of Ford and GM, making it the most valuable of American brands. Accepting to work without pay, Musk quickly captivated the interest of shareholders who were skeptical of his visionary skills, who immediately started to imagine having a CEO working without pay.
In view of the performance of the brand, whose shares were at $ 291 in mid-2018, having closed yesterday at $ 940, Musk saw the first tranche of the prize, which reaches almost $ 800 million, being unlocked. This amount will be paid in Tesla shares, which is equivalent to 1.69 million bonds. Prior to this transaction, Musk already held more than 20 million shares of the brand he runs.