Stocks of Tesla Inc. (NASDAQ:TSLA) climbed 1.85% during the Friday pre-market trading after the company put forth a groundbreaking compensation plan for CEO Elon Musk that could potentially be worth $1 trillion.
Tesla Board Ties Musk's $900 Billion Pay Plan To $8.5 Trillion Value
The board's proposal, outlined in a proxy filing on Friday, ties Musk's compensation to a series of ambitious goals over the next decade. Under the plan, if approved, Musk would receive the first of 12 tranches of Tesla shares once the company's market capitalization reaches $8.5 trillion, up from its current $1 trillion, according to the SEC filing.
“In 2025, he has to grow Tesla by trillions,” the board stated.
The filing states that Musk's new compensation plan could award him stock valued at up to $900 billion, pending a shareholder vote at Tesla's annual meeting on November 6.
Musk Pivots From EVs To Robotics Amid Pay Package Scrutiny
This development follows the unveiling of a $29 billion pay package for Musk by the Tesla board. This new proposal came after a court in Delaware had rejected a $56 billion pay package for Musk, which had been previously approved by the Tesla board.
Musk had also expressed concerns about potentially losing control of Tesla and had denied having any personal loans tied to his stake in the company.
Tesla Inc. board member, Kimbal Musk, defended the newly approved $29 billion pay package for his brother, CEO Elon Musk, saying that he "deserves to be paid" after years without compensation, despite growing scrutiny of the deal.
Meanwhile, Tesla recently revealed its Master Plan IV, which focuses on Robotics and AI. Musk had predicted that the Optimus line of robots would constitute over 80% of Tesla’s future value.
Despite recent struggles in demonstrating demand for its electric vehicles, Tesla’s attention is shifting towards autonomous vehicles and the upcoming Optimus humanoid robot, as Musk hinted at a $20 trillion opportunity for the company.
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