An unprecedented massive compensation package in American corporate history has been approved.
On November 7th, Beijing time, Tesla's annual shareholder meeting was held in Austin, Texas. Tesla announced that CEO Elon Musk's nearly $1 trillion compensation package was approved with 75% shareholder approval.
The announcement of the vote results caused a stir in the room, with shareholders chanting "Elon! Elon!" and standing to cheer. After the shareholder voting concluded, Musk took the stage to begin his speech. Musk, who had just secured a record-breaking salary, seemed quite enthusiastic, even dancing to the cheers of the audience.
Following the vote, prominent Tesla bullish Wedbush Securities analyst Dan Ives released a report stating that Musk is "Tesla's biggest asset." He said, "We still believe that the valuation of artificial intelligence is being realized, and we believe that Tesla's process of achieving an AI-driven valuation has already begun in the next 6-9 months."
On September 5th of this year, Tesla's board of directors submitted this unprecedented "sky-high compensation plan".
This plan could allow Musk to receive more than 423 million Tesla shares over the next 10 years, representing 12% of the company. If successfully implemented, Musk's voting power in the company could exceed 25%.
The plan, designed to incentivize Musk to continue leading Tesla for many years to come, sets a series of ambitious performance indicators that Musk must achieve to receive his full compensation. The plan is valid for ten years.
Specifically, Tesla plans to grant Musk approximately 12% of the company's shares, with a total value of approximately $1.03 trillion. The main conditions include: the company's market capitalization reaching $8.5 trillion (currently around $1 trillion), representing an increase of nearly eight times, which is twice the current market capitalization of Nvidia; in addition, all equity awards will be unlocked only after Musk leads the company to achieve several ambitious goals.
In its filing with the SEC, Tesla wrote, “In designing this new performance incentive, we explored several options. Ultimately, the new award aims to draw on the success of the 2018 CEO Performance Award framework—which ensured Elon was only compensated upon achieving performance targets and incentivized him to lead Tesla through a period of rapid growth. This performance award also challenges Elon to achieve a set of more ambitious goals.”
Other goals associated with the compensation plan include: delivering 20 million Tesla vehicles, 10 million active FSD subscriptions, delivering 1 million robots, 1 million Robotaxi commercial operations, and ultimately up to $400 billion in adjusted EBITDA profit.
Foreign media reports that if Musk successfully achieves his compensation plan goals, he could very well become the first "trillionaire" in human history.
The latest Bloomberg Billionaires Index shows that Elon Musk is the world's richest person with a net worth of $473 billion, and has far surpassed Oracle founder Larry Ellison, who is in second place.
