Elon Musk earns performance-based Tesla payout worth $775M

Elon Musk is officially in the money.

The Tesla CEO on Thursday became eligible to cash in on a controversial payday which could see him pocket more than $700 million.

The electric automaker said in a filing that its board had certified the operational milestone needed to unlock the first award in Musk’s eye-popping $50 billion pay package, which required him to steer Tesla’s stock market value to an average of more than $100 billion over the past six months.

Musk now has the option to buy 1.69 million Tesla shares at $350 a pop. At Tesla’s Thursday closing price of $805.81, the billionaire could flip his new shares for a profit of about $775 million.

Musk’s award comes just weeks after he listed two Bel Air mansions on real estate site Zillow, following a series of tweets in which he said Tesla’s stock price was “too high” and that he would “own no house” and get rid of most of his possessions.

To earn his full, $50 billion award, Musk would have to lead Tesla to a market cap of $650 billion by 2028. Tesla’s board signed off on the compensation package in March 2018, when Tesla’s market cap was $52.46 billion.

Musk still has eight years left to clear 11 more valuation hurdles, mostly in $50 billion increments, which would fetch him roughly $5 billion each. If Tesla doesn’t reach any other milestones, Musk will not receive any more money from Tesla.

The South Africa-born billionaire does not take a salary from Tesla, and only earns money through performance-based rewards.

A full payoff for Musk, who is also the majority owner and CEO of the SpaceX rocket maker, would surpass anything previously granted to US executives.