Tesla Shareholders approve a 50 Billion Dollar payment package

[ItsMitch]

I think we can all say Elon has had a great year at Tesla and SpaceX and earlier in the year, Tesla announced a new payment plan for Elon. Elon currently gets paid nothing by Tesla and SpaceX according to SEC filings. Elon should be having a very nice payday assuming he achieves all of his reward milestones

 

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Tesla’s shareholders have voted to approve a new 10-year compensation plan for CEO Elon Musk valued at around $2.6 billion in stock options, according to multiple outlets.

Musk won’t get the full value in one lump sum, and he might not even get all of it. The compensation is dependent on the company hitting certain milestones in the coming years, including whether or not Musk can usher Tesla to an astronomical market valuation of $650 billion in the next 10 years — an amount that would be more than 10 times the company’s current value of around $59 billion.

Once Tesla reaches a market valuation of $100 billion, Musk will be awarded one-twelfth of the total stock options package. Each time Tesla’s market valuation grows $50 billion beyond that, he’ll be awarded another same-sized slice of the stock options. There are also 16 operational milestones that have to do with specific revenue and profitability targets, though up to 12 of those can be tied to the market cap goals.

 

Currently, the market value of Tesla is 53 Billion Dollars according to NASDAQ and Musk needs to get that market value all the way up to 650 billion in the next ten years. While it may seem a very long shot, it could be a very profitable long shot. It could even make Elon on the run to the richest man in the world if he gets all of is awards. The vote from all the shareholders was in at 73% approval. To complete all of these awards Elon must remain as Tesla CEO and the shareholders do agree that it's a:

 

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“Elon will receive no guaranteed compensation of any kind — no salary, no cash bonuses, and no equity that vests simply by the passage of time,” the company wrote in a statement when the compensation plan was announced in January. “Instead, Elon’s only compensation will be a 100% at-risk performance award, which ensures that he will be compensated only if Tesla and all of its shareholders do extraordinarily well.”

Musk took on a similar CEO compensation plan in 2012, when the company’s market valuation was just $3.2 billion. That plan revolved around product development milestones like completing the first Model X and Model 3, or reaching specific numbers of total cars produced. The company’s board of directors recently said in an SEC filing that it “believes that the 2012 Performance Award played a significant role in Tesla’s operational and financial success by properly aligning Mr. Musk’s incentives with the best interests of Tesla and its stockholders.”

 

 

For the exact details on the reward plan, Tesla set it out in a clear fashion.

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CEO Performance Award Details

The performance award consists of a 10-year grant of stock options that vests in 12 tranches. Each of the 12 tranches vests only if a pair of milestones are both met.

• Market Cap Milestones: To meet the first market cap milestone, Tesla's current market cap must increase to $100 billion. For each of the remaining 11 milestones, Tesla's market cap must continue to increase in additional $50 billion increments. Thus, for Elon to fully vest in the award, Tesla's market cap must increase to $650 billion.
   
• Operational Milestones: To meet the operational milestones, Tesla must meet a set of escalating Revenue and Adjusted EBITDA targets (the only adjustment to EBITDA is for stock-based compensation). These milestones are even more directly aligned with shareholder value creation than those used in Elon's 2012 performance award. They are designed to ensure that as Tesla's market cap grows, the company is also executing well on both a top-line and bottom-line basis.

For each of the 12 tranches that are achieved, Elon will vest in stock options that correspond to 1% of Tesla's current total outstanding shares (1% of that amount is approximately 1.69 million shares). If none of the 12 tranches is achieved, Elon will not receive any compensation.

 

Sources today are The Verge and Tesla IR relations.

IR: http://ir.tesla.com/releasedetail.cfm?ReleaseID=1054948

The Verge https://www.theverge.com/2018/3/21/17147678/elon-musk-tesla-ceo-compensation-award-plan

[QuantumBit]

I would totally trust Elon as the richest man on Earth, hope this goes well

[Noctus]

Why exactly isn't he getting paid by them NOW ?

[QuantumBit]

Just now, Noctus said:

Why exactly isn't he getting paid by them NOW ?

Err wouldn't 50+ billion be a bit too much at once?

[ItsMitch]

Just now, Noctus said:

Why exactly isn't he getting paid by them NOW ?

He doesn't want the money and has rejected any kind of wages. He launches rockets for a living, I don't think he needs the money. 

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(The company makes a California-mandated minimum wage salary available to him, but he has not accepted it, according to SEC filings.)

 

[JCBiggs]

never going to happen. if there is one thing you can count on, its Elon musk NOT hitting a milestone. 

 

also.  His cars arent that great.   GM and Ford know how to do this and are MILES ahead of tesla in both production, and automation.  Several other companies are also working on self driving solutions that are also better than tesla's (and include lidar)  
 

The only way tesla ever sees those kinds of market cap numbers is a serious devaluation of the dollar, or a massive merger with ford or another entity.  

 

 

[ItsMitch]

Just now, JCBiggs said:

never going to happen. if there is one thing you can count on, its Elon musk NOT hitting a milestone. 

 

I'm guessing you didn't check the stocks before and after Elon took over as CEO?

[QuantumBit]

4 minutes ago, JCBiggs said:

never going to happen. if there is one thing you can count on, its Elon musk NOT hitting a milestone. 

 

Huh? He reaches a bunch of milestones,

 

Like when he built a huge battery for Australia in under 100 days or something like that  or else it'd be free

4 minutes ago, JCBiggs said:

also.  His cars arent that great.   GM and Ford know how to do this and are MILES ahead of tesla in both production, and automation.  Several other companies are also working on self driving solutions that are also better than tesla's (and include lidar) 

Havent they been in the car industries for decades? Of course they'll be ahead in production

What do you mean by that last part?

[JCBiggs]

that stock price has nothing to do with elon, and everything to do with selling 50 cars a year vs 100,000 in  2017. 

 

 

but let me put that in perspective.  GM and Ford sold over 3 MILLION cars.   tesla isnt even close guys.  Im not a tesla hating petrol head. electric cars are fast as f#%, but tesla is not the savior lol.   the model 3 is not as cheap as they said it would be, and tesla cars are known to have some of the worst NVH numbers in the business.   And just wait.. they have been on the market long enough now that people are going to be needing batteries soon. wait until that starts kicking in and people have to finance to car all over again just to pay for the battery.   

 

they might get there is 20 years.  but no chance in hell it happens in 10. 

 

 

QuantumBit,  its pretty much been agreed upon by most experts than you cant have a level  V autonomous vehicle without lidar sensors.  Tesla's is camera based.  and its a really really good system, but they are going to have to add lidar at some point, and those sensors are VERY expensive.  In fact Im working on a contract right now just to make the housings, and the numbers they are talking are ridiculous. 

[ItsMitch]

Just now, JCBiggs said:

but let me put that in perspective.  GM and Ford sold over 3 MILLION cars

  compared to 

That's a silly perspective. Did they sell more cars than Tesla? No shit? They've been in the business 100 years while Tesla only 15. 

[JCBiggs]

Just now, SC2Mitch said:

  compared to 

That's a silly perspective. Did they sell more cars than Tesla? No shit? They've been in the business 100 years while Tesla only 15. 

My point is that tesla cannot make cars as fast or as cheap as the others.  not that they CANT get there, it just wont be in the next 10 years. 

[QuantumBit]

3 minutes ago, JCBiggs said:

My point is that tesla cannot make cars as fast or as cheap as the others.  not that they CANT get there, it just wont be in the next 10 years. 

Of course they wont now! Do you expect a decade old company to compete with a century old one? Can you PLEASE show me your crystal orb where you can see whats going to happen in the next 10 years?

[Nicnac]

great news! hope elon can deliver

[ARikozuM]

I'm all for this. I've been loving the direction that Elon has pushed Tesla towards in regards to the EVs and alternative energy. I haven't heard much about prematurely broken parts and preventative maintenance seems to be the only thing that needs to be done with the EV lineup. 

 

Also, who the flying f#ck is comparing Tesla capable EVs to Ford's shit EVs and mostly their gas vehicles? 

[JCBiggs]

1 minute ago, QuantumBit said:

Of course they wont now! Do you expect a decade old company to compete with a century old one? Can you PLEASE show me your crystal orb where you can see whats going to happen in the next 10 years?

i dont need a crystal orb..  ford makes 2 million cars a year and is only worth 45 billion.         

 

The numbers just dont work man.   the value of a company is not based on some fantasy sells margin numbers. in order to be a 650 billion dollar company, they would have to put ALL of the big 3 out of business,   and honda, and they would STILL be over 300 billion short.  LOL  

 

maths.

[pas008]

4 minutes ago, JCBiggs said:

My point is that tesla cannot make cars as fast or as cheap as the others.  not that they CANT get there, it just wont be in the next 10 years. 

wtf does that have to do with profits

sell 3 million cars profit 1k each

sell 100000 cars profit 10k each

which company would you want to invest in?

 

show me gm and fords electric cars that can do 0-60 in 3secs

 

show me gm and fords other ventures like rockets/batteries/building new ways of doing things/etc

 

 

[QuantumBit]

Just now, JCBiggs said:

i dont need a crystal orb..  ford makes 2 million cars a year and is only worth 45 billion.         

 

The numbers just dont work man.   the value of a company is not based on some fantasy sells margin numbers. in order to be a 650 billion dollar company, they would have to put ALL of the big 3 out of business,   and honda, and they would STILL be over 300 billion short.  LOL  

 

maths.

Gosh gosh gosh youre infuriating....

 

[JCBiggs]

4 minutes ago, pas008 said:

wtf does that have to do with profits

sell 3 million cars profit 1k each

sell 100000 cars profit 10k each

which company would you want to invest in?

 

show me gm and fords electric cars that can do 0-60 in 3secs

 

show me gm and fords other ventures like rockets/batteries/building new ways of doing things/etc

 

 

Show me Teslas truck than can pull 30,000 lbs 500 miles.   Ram has a nice one for about 62K

 

LOL.   are you really going to sit there an honestly say and believe that the others CANT do it?    come one man. stop drinking the coolaid.  come back to reality. the competition is real, and the automakers of the world arent just going to roll over because tesla has a big battery  building in the desert.  

best case scenario for tesla, they supply batteries to all the other automakers.  

[JCBiggs]

repost

[pas008]

9 minutes ago, JCBiggs said:

Show me Teslas truck than can pull 30,000 lbs 500 miles.  

 

LOL.   are you really going to sit there an honestly say and believe that the others CANT do it?    come one man. stop drinking the coolaid.  come back to reality. the competition is real, and the automakers of the world arent just going to roll over because tesla has a big battery  building in the desert.  

best case scenario for tesla, they supply batteries to all the other automakers.  

lol why are you so butthurt?

you are the one that came in this topic with your antifanboyism

seriously ford and gm been in the game how long both needed to cut costs and gm needed bailout

 

after being in business how long? shouldnt they have other ventures too?

 

ok enough said

[QuantumBit]

1 minute ago, JCBiggs said:

Show me Teslas truck than can pull 30,000 lbs 500 miles.  

 

LOL.   are you really going to sit there an honestly say and believe that the others CANT do it?    come one man. stop drinking the coolaid.  come back to reality. the competition is real, and the automakers of the world arent just going to roll over because tesla has a big battery  building in the desert.  

best case scenario for tesla, they supply batteries to all the other automakers.  

Tesla hasnt released a truck? That isn't a fair comparison? Whats up with you and comparing very faintly related things?

[ItsMitch]

6 minutes ago, JCBiggs said:

Show me Teslas truck than can pull 30,000 lbs 500 miles.   Ram has a nice one for about 62K

 

LOL.   are you really going to sit there an honestly say and believe that the others CANT do it?    come one man. stop drinking the coolaid.  come back to reality. the competition is real, and the automakers of the world arent just going to roll over because tesla has a big battery  building in the desert.  

best case scenario for tesla, they supply batteries to all the other automakers.  

Yikes..... 

[ARikozuM]

13 minutes ago, JCBiggs said:

Show me Teslas truck than can pull 30,000 lbs 500 miles.   Ram has a nice one for about 62K

https://www.tesla.com/semi

 

 

Costs 180K or 200K, but saves 50 or more gallons of diesel per week. Speculation puts its gas savings at 1.26 per mile vs 1.51 per mile on diesel. Most deliveries are done from a distribution center/warehouse and then sent out to end wholesalers which are usually well within the 500-mile travel range.

[BuckGup]

39 minutes ago, JCBiggs said:

never going to happen. if there is one thing you can count on, its Elon musk NOT hitting a milestone. 

 

also.  His cars arent that great.   GM and Ford know how to do this and are MILES ahead of tesla in both production, and automation.  Several other companies are also working on self driving solutions that are also better than tesla's (and include lidar)  
 

The only way tesla ever sees those kinds of market cap numbers is a serious devaluation of the dollar, or a massive merger with ford or another entity.  

 

 

"Cars aren't that great" go home kid or actually get out more

[Blademaster91]

13 minutes ago, BuckGup said:

"Cars aren't that great" go home kid or actually get out more

Bad exterior panel fitment,gaps, interior being low quality for the price of the vehicle like the seat leather wearing out or discoloring from clothes, so much electronic stuff that will go bad ie. the servo actuated door handles?

And look at the terrible door and trunk alignment on this one for example,while a nice car it's overpriced for the quality. I don't hate Tesla cars but the quality isn't there yet with the hype they receive.

https://www.youtube.com/watch?v=te6VqldjTT8

18 minutes ago, ARikozuM said:

https://www.tesla.com/semi

 

Costs 180K or 200K, but saves 50 or more gallons of diesel per week. Speculation puts its gas savings at 1.26 per mile vs 1.51 per mile on diesel. Most deliveries are done from a distribution center/warehouse and then sent out to end wholesalers which are usually well within the 500-mile travel range.

And how much will the battery replacement cost in a few years? Conventional diesel trucks go 500k miles without any major engine servicing and can go more than 60mph up a 5% grade.