The new “replacement” bahl package, that Tesla For a fundamental reason, the one presented for Elon Musk on August 3 is a great improvement to its predecessor. It guarantees what the predecessor version left open – the very real possibility that the shareholders will only return at the price on which they take Muschus a huge tour when they made Muschus the Musk, only watered down for the observes of the directors. And Musk still holds billions worth shares.
Remember that the Delaware dishes in 2024 made the famous Giga-Grant approval approved in January 2018 in response to a complaint from the shareholders of the EV manufacturer. Musk and the company now appeal against the judgment and the decision. The Tesla board entered to ensure that the CEO, when the Tesla page loses, receives something similar. But this time they are a number of wise conditions that are missing the first time.
Of course, the deal only applies if the musk and Tesla lose in the appeal procedure. In this case, as part of the new iteration, he received a limited share grant of 96 million shares at an exercise price of $ 23.34, which corresponds to the number when he received the gigantic abundance at the beginning of 2018. At Tesla’s current price of around 309 US dollars, these shares would be a value of over $ 27 billion. Here are the restrictions: the equity vest on the second anniversary of the scholarship or in early August 2027, but only if Musk serves this entire period as CEO or head of product development or operation. In addition, he cannot sell any of these authorized shares up to five years from the date of the award or on August 3, 2030.
The aim of the directors is to consider musk to improve the chances that he will deliver his promises for upcoming, no commercial robotaxis, self -driving software and humanoid robots. But for Tesla owners who start losing faith when the Gauzy commitments are casual to use the structure of the plan to use the cliché that can be found in CEO Compils so often
The 2018 plan rewarded Mosch
The pioneering original muse director price of 1% of the Tesla shares, each granted, increased for a further 50 billion US dollars. The starting point was 100 billion US dollars – a multiple of its market capitalization at this time. If Muschus reached the maximum of 650 billion US dollars, a number that seemed wildly seemed to be wild at the time, he would collect 12% of Tesla’s shares. The frame resembled the process of opening a safe locker; Getting a new 1% required two “keys”, with the rating bogey reaching and secondly reached 12 out of 18 combined goals for income and EBITDA. The Top -bitda goal was 14 billion US dollars and the highest sales target of $ 175 billion.
The bell was within just three and a half years of 2021. He first exceeded the market capitalization of 650 billion US dollars Max and later achieved all EBITDA benchmarks and supplemented this performance by achieving an intermediate sale of 75 billion US dollars, which was good enough overall to meet the 12 operational metrics. So Muschus got the full windfall.
The big mistake of the concept: Musk repeatedly made great vows for incredibly profitable new products that inspired investors. This helped send the shares to Skyward and help him reach the evaluation part. The sales and EBITDA requirements were relatively easy to make. The combination of a rhetorical inflation of the share price and the non -compliance with the fabulous basic figures for the basic profitability won the day.
To be fair, Tesla’s upper limit is still three times its level at almost 1 trillion US dollar, as Musk received his average share grant with one percent and 50%, where he received his last piece with $ 650 billion. The problem: it is impossible to get an idea of what Tesla is really worth in the long run. And if it turns out that it is mainly a metal bending company or if the Capex requirements for building Musk’s visionary companies and strong competition are required, Teslas could fall back if it was.
As part of the New Deal, Musk is not paid if Tesla’s stock tanks have not paid for a long time
The original plan had a big weakness. Musk received his 12% of the inventory in advance. Even if the shares decreased by USD 23.34 and the market capitalization of Tesla had 75 billion US dollars, it would still have 9 billion US dollars in stocks (12% of $ 75 billion). And the shareholders had suffered great dilution and received zipper.
But the new plan ensures that this cannot happen. Is it absolutely impossible that Tesla falls that far? Not at all. Just look at his current basics. The original plan only made sense when Tesla had achieved the operational goals to trigger the grants and continued to increase and from there the income and profits. In other words, the basics had to grow into the evaluation. Musk was essentially paid for great things.
That didn’t happen. In the first two quarters of this year, Tesla’s turnover was just above the Bogey of 75 billion US dollars at an annual price of 84 billion US dollars a few years ago. In the same six months, his EBITDA set $ 12 billion annually, below the number 14 billion US dollars, which unlocked the payment.
I recently wrote a piece about the calculated “Musk Magic Premium”, which was calculated What Tesla is worth to be assigned to its current products and the additional value for Musk’s visionaries– This is the premium. In order to obtain the repeatable profit number for today’s electric vehicles and batteries, I remove accounting gains or losses for its Bitcoin -Holdings and subtract the sales of regulatory loans, which are now probably dying due to the recent penalties of Trump’s car manufacturers who have no longer bought.
In the last four quarters, this “hardcore” number is 3.3 billion US dollars. Imagine that Muschus increases this number to a reasonable 8% per year, so that the net profit reached 5.4 billion US dollars in 2030, the year in which Musk sells shares free of charge as part of the new program (if this happens). If we also accept because it is a manufacturer of low growth, Tesla guarantees a PE, which is 14 far above the average of the automotive industry. Then it would be a value of 75 billion US dollars for five years.
This result would bring the shares back directly near Musk’s exercise price of $ 23.34. His big grant would be worthless, while he would still have shares worth 9 billion US dollars under the old. Even if the Tesla shares drop to around $ 50 and its upper limit at around 150 billion US dollars, Musk would earn much less, around 2.5 billion dollars. Yes, it is a good thing that the Tesla board forces the musk of the board to wait a long time to be paid. In five years we can see what all these promises are really worth. If you are exhausted by a handover tube, shareholders suffer in great times. But Elon Muschus will suffer with them.
