Let’s recap Musk’s compensation plan, because it suddenly seems a whole lot less crazy. Back in January 2018, the board of Tesla presented a compensation plan for Musk that could be worth $100 billion. Musk will receive up to $100 billion in stock options over a decade if he (and Tesla) meets certain goals called tranches. There are 12-tranches to this plan. He gets the first chunk of options when Tesla hits a market cap of $100 billion (which has been achieved). At the time the plan was announced, Tesla had a market cap of about $50 billion. After that, Musk gets another one of the tranches each time Tesla’s market cap increases by another $50 billion (which has been achieved for $150 billion). If Musk can grow Tesla to a $650 billion market cap, he will earn the entire $100 billion. Of course, Musk’s primary source of wealth is his stock holdings in Tesla and SpaceX. Tesla’s stock has been on a run. The stock has continued to surge as the company beat analyst estimates in its third-quarter earnings report back in October. As of this writing, Tesla stock as more than doubled since January 2nd’s price of $430.26. It is currently trading at $887.06 as of the close of trading on Tuesday, February 4.
