Tesla Announces New Long-Term Performance Award for Elon Musk
Globe Newswire
Compensation is Tied to Market Capitalization and Operational Milestones that are Based on Tesla Becoming One of the Most Valuable Companies in the World
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| Tesla CEO Performance Award |
Elon Will Continue Leading Tesla Over the Long-Term
PALO ALTO, Calif., Jan. 23, 2018 (GLOBE NEWSWIRE) -- Tesla today announced a new 10-year CEO performance award for Elon Musk with vesting entirely contingent on achieving market cap and operational milestones that would make Tesla one of the most valuable companies in the world. In order to fully vest, Tesla's market cap would have to grow to $650 billion (an increase of almost $600 billion), and important revenue and profitability goals would also have to be achieved. The award is modeled after Elon's 2012 performance award, which helped bring about a more than 17-fold increase in Tesla's market cap in the five years after it was put in place.
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. 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. Because all Tesla employees are provided equity, this also means that Elon's compensation is tied to the success of everyone at Tesla.
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 is 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.
Leading Tesla Through Its Next Phase of Growth
For vesting to occur when the milestones are met, Elon must remain as Tesla's CEO or serve as both Executive Chairman and Chief Product Officer, in each case with all leadership ultimately reporting to him. This ensures that Elon will continue to lead Tesla's management over the long-term while also providing the flexibility to bring in another CEO who would report to Elon at some point in the future. Although there is no current intention for this to happen, it provides the flexibility as Tesla continues to grow to potentially allow Elon to focus more of his attention on the kinds of key product and strategic matters that most impact Tesla's long-term growth and profitability.
Patterned After 2012 Performance Award
This new performance award is similar to the structure of Elon's last compensation award, which was put in place in 2012. Under that plan, Elon was awarded stock options that vested only if the company's market cap continued to increase in $4 billion increments and if it achieved matching operational milestones, including vehicle production targets and developmental milestones relating to the Model X and Model 3 programs. While these milestones were viewed at the time as very difficult to achieve, all of the market cap milestones and 9 of the 10 operational milestones have been achieved. The 2012 plan formed the biggest part of the executive compensation program that Tesla shareholders overwhelmingly supported in the company's 2014 and 2017 Say on Pay votes. That plan was instrumental in helping Tesla complete the roadmap laid out in its original Master Plan, and in ensuring that Elon only received compensation based on the enormous success of the company, its employees, and all its other shareholders.
As with the 2012 plan and Tesla's original Master Plan, the new performance award has been designed so that Tesla and Elon remain tightly aligned with shareholder interests as they now execute on Master Plan, Part Deux - continuing to build what is the world's first vertically-integrated sustainable energy company, from generation to storage to consumption. Under Elon's leadership, the next phase of Tesla's development involves a number of exciting plans that will further accelerate the advent of sustainable energy. These include expanding solar energy generation through Solar Roof and other solar products and seamlessly integrating them with battery storage, building out the company's vehicle product line to cover all major forms of terrestrial transport, continuing to advance autonomous technology to create a fully-self driving future, and enabling sharing so that your car can make money for you when you aren't using it.
Upcoming Shareholder Vote
The new performance award was created by Tesla's Board of Directors (with Elon and Kimbal Musk having recused themselves) after more than six months of careful discussion and analysis and in consultation with Compensia, Inc., a third-party compensation consultant. Although the Board granted this award to Elon on January 21, 2018, its effectiveness is subject to the approval of Tesla's shareholders, who will be asked to approve it at a special shareholder meeting that will be held in late March. Elon and Kimbal Musk will recuse themselves from that vote so that Tesla's other shareholders have the opportunity to determine the outcome.
Anyone who is a shareholder of record or beneficial owner of Tesla shares as of the record date (currently projected to be February 7, 2018) will be entitled to vote their shares at the special meeting and the award will only become effective if a majority of the votes cast are in favor of the proposal. Tesla has posted on its website a preliminary proxy statement (bit.ly/CEOPerformanceAward) providing complete details of the award along with additional materials for Tesla shareholders, and Tesla will be filing that with the SEC today.
Additional Information and Where to Find It
Tesla, Inc. ("Tesla") plans to file with the Securities and Exchange Commission (the "SEC"), and furnish to its shareholders a proxy statement in connection with the proposed CEO performance award for Elon Musk (the "CEO Performance Award"). The proxy statement described above will contain important information about the proposed CEO Performance Award and related matters. SHAREHOLDERS OF TESLA ARE URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS THAT TESLA WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT TESLA AND THE CEO PERFORMANCE AWARD. Shareholders will be able to obtain free copies of these documents and other documents filed with the SEC by Tesla through the website maintained by the SEC at www.sec.gov. In addition, shareholders will be able to obtain free copies of these documents from Tesla by contacting Tesla's Investor Relations by e-mail at ir@tesla.com, or by going to Tesla's Investor Relations page on its website at ir.tesla.com.
Participants in the Solicitation
The directors and executive officers of Tesla may be deemed to be participants in the solicitation of proxies from the shareholders of Tesla in connection with the proposed CEO Performance Award. Information regarding the interests of participants in the solicitation of proxies in respect of the Special Meeting will be included in Tesla's proxy statement to be filed with the SEC.
Forward-Looking Statements
Certain statements herein, including statements regarding future development plans, are forward-looking statements that are subject to risks and uncertainties. These forward-looking statements are based on management's current expectations. Various important factors could cause actual results to differ materially, including the risks identified in our SEC filings. Tesla disclaims any obligation to update any forward-looking statement contained in this press release.
A photo accompanying this release is available athttp://www.globenewswire.com/NewsRoom/AttachmentNg/edfcfa2e-bcb6-43ed-ab53-4b08b3bf21ca
Source: Tesla, Inc.
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FAQs
How do I contact Tesla investor relations? ›
By Regular Mail: PO BOX 505000, Louisville, KY 40233-5000 USA. By Overnight Delivery: 462 South 4th Street, Suite 1600, Louisville, KY 40202 USA. Telephone Toll: +1 (781) 575 4238. Telephone Toll Free: 1-800 662 7232.
Who is Tesla investor? ›Tesla's largest institutional investors
Vanguard Group, Blackrock (BLK) and Capital World Investors are among the top institutional shareholders of Tesla, accounting for a combined 15% of its outstanding shares.
| Stockholder | Stake | Shares owned |
|---|---|---|
| The Vanguard Group, Inc. | 6.20% | 194,251,740 |
| BlackRock Fund Advisors | 3.40% | 106,406,025 |
| SSgA Funds Management, Inc. | 3.04% | 95,363,172 |
| Capital Research & Management Co.... | 2.89% | 90,506,664 |
Our Q3 results were announced at about 3:00 p.m. Central Time in the update that we published at the same link as this webcast.
How can I invest in Tesla directly? ›- Open a Brokerage Account. Opening a brokerage account is your key to buying and selling securities, like stocks, mutual funds and exchange-traded funds (ETFs). ...
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“At times, they were extremely helpful with my reporting with responses and context/nuances/corrections.” And while he didn't always agree with all their approach. I think Tesla's PR department was a net positive overall as they helped correct a lot of misinformation about the company.”
Does Elon own PayPal? ›In 2002, PayPal was acquired by eBay for $1.5 billion in stock, of which Musk—the largest shareholder with 11.72% of shares—received $175.8 million. In 2017, more than one and a half decades later, Musk purchased the X.com domain from PayPal for its sentimental value.
Does Tesla pay a dividend? ›Plus, Tesla does not pay a dividend to shareholders, which is also an important factor for income investors to consider. As a result, we believe income investors looking for lower volatility should consider high-quality dividend growth stocks, such as the Dividend Aristocrats.
Who owns the majority stake in Tesla? ›U.S. Tesla was incorporated in July 2003 by Martin Eberhard and Marc Tarpenning as Tesla Motors. The company's name is a tribute to inventor and electrical engineer Nikola Tesla. In February 2004, via a $6.5 million investment, Elon Musk became the largest shareholder of the company.
How many Teslas does Elon own? ›After all the selling, Musk holds about 155 million shares of Tesla (ticker: TSLA).
What percent of Tesla does Elon own? ›
Musk owns 172.6 million Tesla shares, or a 17% stake, which makes him its single largest individual shareholder.
Will Tesla stock split again in 2022? ›Tesla stock split timeline
On August 4, 2022, Tesla's shareholders approved the 3-for-1 stock split during the company's annual meeting.
Stock Price Forecast
The 35 analysts offering 12-month price forecasts for Tesla Inc have a median target of 305.00, with a high estimate of 530.00 and a low estimate of 85.00. The median estimate represents a +47.08% increase from the last price of 207.37.
Tesla is not a buy at this time. It has hit resistance at the 200-day line, so the short-term outlook is poor. After a strong July, this pullback is not surprising, and the stock is well below prior highs.
What is the minimum amount to invest in Tesla? ›Buy Tesla stocks from these brokerages
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With Tesla's stock price around $250 per share as of October 2022, you may not have enough money to buy an entire share. Several brokers, including Charles Schwab and Fidelity, have started offering fractional shares to help with this problem, allowing you to invest with just a few dollars.
Who is Tesla's biggest competitor? ›Tesla has a lot of competitors. However, the American multinational automobile manufacturer Ford is currently Tesla's biggest rival. The company is set to invest $22 billion until 2025 to continuously pursue vehicle electrification.
What company is partnering with Tesla? ›Key Tesla Suppliers
BHP: nickel. Ganfeng Lithium Co.: lithium. Glencore: cobalt.
Elon Musk's Tesla hired PR firm to monitor employees on Facebook: Report.
Who are Tesla's strategic partners? ›- Catalyst Commodities Ltd. ...
- DTN (previously MeteoGroup) ...
- Energy Market Services. ...
- ENERPIQ CONSULTING P.C. ...
- EPSI Platform. ...
- Green Services and Consulting (Green SAC) ...
- Japan Weather Association. ...
- Maxar.
What phone does Elon Musk use? ›
Elon Musk Just RELEASED The Tesla Phone! (RIP iPhones) - YouTube
Where did Elon Musk get all his money? ›How did Elon Musk make his money? Elon Musk has made billions from various business ventures - from founding PayPal and SpaceX to becoming the CEO of Tesla. His net worth is also based on his shares in Tesla, as he owns around 24 per cent.
How much does Elon Musk make an hour? ›This makes it easier to answer the question, how much does Elon Musk make an hour? Since his daily earnings for the first quarter of 2022 are an estimated $333.33 million per day, his hourly rate would be $51.30 million.
Why is Tesla stock splitting? ›Tesla implemented the split by paying a stock dividend of two shares for each share held after the close of trading. The stock split makes the shares less expensive, and more accessible for a wider base of retail investors. It also makes trading options in the stock less expensive.
When would Tesla stock split happen? ›Perhaps the most pertinent piece of data for investors to know is when, exactly, Tesla's stock split will take place. The answer is exactly one week from today, on August 25, 2022 prior to the market open.
How many times has Tesla split? ›Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations. Tesla (TSLA) has completed a 3-1 stock split for the company's shares.
Is SpaceX part of Tesla stock? ›SpaceX is not a public company, it is still privately owned. Tesla, one of Elon Musk's other companies, is a public company.
What billionaire owns Tesla? ›Tesla CEO Elon Musk, ranked as the world's wealthiest person by both Forbes and the Bloomberg Billionaires Index, last year explained that the secret to his wealth is simple: "I own 20% of a company that became very valuable."
How many shares does Elon Musk own in SpaceX? ›Musk also owns between 40% and 50% of the stock in his space company SpaceX, which is valued at about $100 billion based on its recent capital raises. (SpaceX didn't immediately return a request for comment about valuation or Musk's stake either.)
Why is Elon selling his Tesla stock? ›Elon Musk sells nearly $7 billion in Tesla shares to finance his Twitter deal. The billionaire entrepreneur said he wanted “to avoid an emergency sale of Tesla stock” if he was forced to complete the buyout of the social media company.
Which stocks does Elon Musk own? ›
Key Takeaways. Musk's best investments include PayPal, SpaceX, DeepMind Technologies, Tesla, and The Boring Company.
How much of Tesla does SpaceX own? ›He currently owns about 17 percent of Tesla, according to Bloomberg.
Does Elon Musk drive a Tesla? ›Elon Musk has confessed that his Tesla Model S is the car he drives the most. That shouldn't be a surprise, given that the Model S is the comfiest and most accommodating vehicle in the Tesla fleet.
Will everyone own a Tesla? ›Well, Tesla co-founder and CEO Elon Musk just told us when that will change -- at least when it comes to car ownership. More precisely, he said that by 2022, nearly everyone will be able to afford a Tesla, but here's the catch: They won't need to.
Does Elon make money from Tesla? ›Most of Elon Musk's wealth comes from Tesla, as he's the major shareholder for the company. Making Elon Musk's net worth well past the hundred billion-dollar mark.
Is it better to buy before or after a stock split? ›A stock split like Tesla stock can be tempting for investors because it allows them to buy what was a previously more expensive stock at a much cheaper price. But investors should never buy a stock just because of a stock split.
What was Tesla price before split? ›After the 3-to-1 split, Tesla's shares were trading at about $302, a third of where they stood prior to market open. Shares later fell to about $296. Investors received two additional shares for each share they held prior to the split.
Is Tesla ready to split? ›Tesla stock will begin trading at a 3-for-1 split-adjusted price on Aug. 25. Tesla has given investors something to look forward to: The electric-vehicle giant announced the date of its coming stock split.
What will Tesla be worth by 2030? ›Could Tesla really have $500 billion on its books at the end of 2030? One analysts believes its possible. Tesla 's cumulative free cash flow could amount to $500 billion by roughly the end of the decade, an unprecedented amount in the auto industry—or any other, for that matter.
Is it smart to invest in Tesla right now? ›The future certainly looks bright for Tesla. While a P/E above 70 is an extremely high valuation, if the company continues to grow at or near 50% for several more years, that won't seem so rich. For investors looking years or decades down the road, buying Tesla right now could make good sense.
What is the best time of day to buy Tesla stock? ›
The opening 9:30 a.m. to 10:30 a.m. Eastern time (ET) period is often one of the best hours of the day for day trading, offering the biggest moves in the shortest amount of time. A lot of professional day traders stop trading around 11:30 a.m. because that is when volatility and volume tend to taper off.
Why is Tesla down after earnings? ›Shares of Tesla declined more than 3% Wednesday afternoon after the company fell short of expectations on its third-quarter revenue, though the company did beat estimates for earnings per share and profit.
How much does it cost to buy 1 Tesla stock? ›At some brokers, you can buy Tesla fractional shares for as little as $1. As of early July 2022, a full Tesla share cost $680.
› News › Company News ›Investing in Tesla Stock (TSLA)
Will Tesla Stock Price Crash?
Tesla Stock Forecast | Is Tesla a Good Stock to Buy?
How to submit Bugs/suggestions to Tesla through your Tesla - YouTube
Who is the transfer agent for Tesla stock? ›If you are a “stockholder of record” with shares registered directly in your name with our transfer agent, Computershare Trust Company (a minority of Tesla stockholders), you can find the control number on the Notice of Internet Availability or paper proxy card that was sent to you.
Will Tesla stock split again in 2022? ›Tesla stock split timeline
On August 4, 2022, Tesla's shareholders approved the 3-for-1 stock split during the company's annual meeting.
- Tesla Motors, Inc.
- 3500 Deer Creek Road.
- Palo Alto, California 94304.
- Attention: Vehicle Service.
- 1-877-77-TESLA (1-877-778-3752)
Outline the benefits of your product and explain the features. Discuss the market for your idea, such as parents with children in car seats if your idea is related to child safety. Mention the results of your research to show the market is ripe for your idea, as well as any patents you hold for your idea.
What is Elon Musk's email at Tesla? ›Email Elon Musk at Tesla, press@tesla.com (Tesla Press); nasales@teslamotors.com (Tesla Motors); or tunnels@boringcompany.com (Boring Company).
How do I present an idea to Elon Musk? ›
To contact Elon Musk, write a letter that's addressed to him and send it to Corporate Secretary, Tesla, Inc. 3500 Deer Creek Road, Palo Alto, CA 94304 United States. You can also reach out to Elon Musk over Twitter by using his Twitter handle @elonmusk.
What's the future of Tesla stock? ›Stock Price Forecast
The 35 analysts offering 12-month price forecasts for Tesla Inc have a median target of 305.00, with a high estimate of 530.00 and a low estimate of 85.00. The median estimate represents a +47.08% increase from the last price of 207.37.
Tesla announced in a press release on August 5th that the split will go into effect later in the month. Tesla shareholders will receive a dividend of two additional shares of common stock that will be distributed after close of trading on August 24, 2022.
How are Tesla Advisors paid? ›No Tesla doesn't pay any commissions to their sales people, men and women. The only incentives they have had are referrals from other owners. They give some free charging for the buyer and person referring. They also have never run an ad on TV or in print.
Is it better to buy before or after a stock split? ›A stock split like Tesla stock can be tempting for investors because it allows them to buy what was a previously more expensive stock at a much cheaper price. But investors should never buy a stock just because of a stock split.
What was Tesla price before split? ›After the 3-to-1 split, Tesla's shares were trading at about $302, a third of where they stood prior to market open. Shares later fell to about $296. Investors received two additional shares for each share they held prior to the split.
Is Tesla a good stock option? ›Checkup On Tesla Stock
The stock also has a Relative Strength Rating of 92 out of 99. The rating means that Tesla stock has outperformed 82% of all stocks in the IBD database over the past 12 months. Ideally, look for stocks with an RS rating of 80 or higher.
After several required fixes of the same component (twice or more for critical components and four or more times for non-critical components), the vehicle is considered a lemon. Under such circumstances, the manufacturer must buy back the old vehicle or replace it.
What is Tesla problem? ›The complaints point to all sorts of problems with the experience of owning a Tesla vehicle, including an inadequate number of service centers, limited stock of replacement parts, bad communication, poor manufacturing quality, and long wait times for repair appointments.