Elon Musk says, “Hot damn, I love you,” after Tesla shareholders approve a $56 billion compensation package.

Elon Musk says, “Hot damn, I love you,” after Tesla shareholders approve a $56 billion compensation package. Elon Musk, the CEO of Tesla, was overjoyed when his contentious $56 billion compensation package was approved by regular investors during the company’s shareholder meeting in Austin, Texas.

Musk exclaimed as he took the stage after his compensation package was approved, “I just want to start off by saying, hot damn, I love you guys!” “We have the most amazing group of shareholders. It’s really amazing, Musk continued.

Musk, who had campaigned for the package’s reinstatement after a Delaware judge invalidated it in January, citing shortcomings in the initial approval process due to inadequate independent oversight, considers the approval to be a major victory.

Retail investors supported Musk, even though some institutional investors expressed concerns about his excessive compensation. On social media sites like X (formerly Twitter), many people spoke up in support of Musk and highlighted his roles in Tesla’s success.

Small investors’ active involvement highlights Musk’s exceptional capacity to cultivate loyalty. Through frequent social media posts, a special website outlining the proposals, and even factory tours for certain voting shareholders, the CEO interacted with them.

“Almost 90% of retail investors who cast ballots supported it,” Musk said with pride over the weekend on X. The vote was secured by this resounding backing and the support of a few significant institutional investors.

The judge in Delaware has previously noted the close ties between Musk and the Tesla board, but legal challenges there still stand.

Musk’s salary of $56 billion

Elon Musk has an aggressive ten-year performance-based plan, which includes a $56 billion compensation package.

He received stock options that were subject to a number of strict requirements, such as reaching targets for market capitalization, earnings, and revenue, and which would vest in 12 tranches.

With 303 million stock options, or about 12% of Tesla’s outstanding stock in 2018, the potential reward was enormous. As Musk reached 28 difficult goals, 1% of these options were unlocked with each tranche.

Musk’s wager on Tesla’s expansion had paid off by 2023. In 2020, the company’s market capitalization skyrocketed above the $650 billion mark, and its earnings persisted in exceeding estimates. Musk has almost reached all of his potential stock options after hitting the majority of his revenue milestones.

This package is currently worth $56 billion. Given Tesla’s share price of about $200 and an option strike price of $23 (adjusted for stock splits), each option has an intrinsic value of about $180. When the almost 303 million options are multiplied, the staggering amount is revealed.

Musk’s 2018 compensation package represented a high-risk bet on his ability to turn Tesla from a $60 billion business into a massive profit-making enterprise valued at more than $650 billion.