Tesla CEO Elon Musk earned $775 million, comprising about 1.7 million shares of the company, as the first portion of his incentive payout, according to a report by CNBC.
In a regulatory filing with the Security and Exchange Commission on May 28, Tesla confirmed that Musk earned the first tranche of the performance-based payout for keeping the market capitalisation at $100 billion on a 30-day and six-month trailing average.
The filings state other specifications regarding the revenue milestones. Musk’s full award is set over 12 tranches reaching up to $650 billion in market capitalization for Tesla that can only be exercised under certain conditions. The proxy filing also mentioned that the company’s annual shareholder meeting will be held on July 7.
It said: “As of the date of this proxy statement, one of the 12 tranches under this award has vested and become exercisable, subject to Mr Musk’s payment of the exercise price of $350.02 per share and the minimum five-year holding period generally applicable to any shares he acquires upon exercise.”
The CEO does not take a salary. However, according to the proxy filing, he owns a massive 20.8% stake in the company, comprising a total of 38.7 million shares out of which 18.5 million has been set aside as collateral to Musk’s personal debt.
Tesla stockholder Richard Tornetta has filed a lawsuit alleging breach of fiduciary duty by the company’s board members for awarding excessive compensation to Musk.