Tesla has received shareholders' approval for an unprecedented reward package for CEO Elon Musk, if its ambitious growth targets are met in the next decade.
The plan would allow Musk to receive nearly 423.7 million Tesla shares, divided into 12 rounds, based on reaching milestones such as delivering 20 million electric vehicles, deploying 1 million robotaxi and reaching a EBITDA of $400 billion and a market capitalization of $8.500 billion. If he completes the above conditions and receives the full package, Elon Musk could become the first billionaire with a fortune of $1 trillion.
Tesla president Robyn Denholm warned that the company risks losing Musk's "time, talent and vision" if the reward package is not approved. More than 75% of the votes approved the proposal, but there was still significant opposition from large investment funds.
The Norwegian National Investment Fund, Tesla's largest pension fund investor, said it disagreed because it was concerned about the risk of over-reliance on one person and the independence of the board.
Musk has denied the criticism, calling Counseling for Counter-Voting Organizations like Institutional Shareholder Services and Glass Lewis unreasonable and labeling them terrorists in businesses.
Proponents say the reward package will keep Musk with Tesla for at least 8 to 10 years, while encouraging him to focus on areas the company is pursuing such as artificial intelligence, robots and autonomous vehicles.
According to Forbes, Musk is currently the richest billionaire in the world with an estimated fortune of $487.5 billion. If he achieves all the goals, his ownership ratio at Tesla could increase to about 29% from the current 15%. If the goal is not achieved, the bonus can be significantly reduced.
