Business mogul Elon Musk was paid $0 in 2020 for being Tesla’s chief executive, the company said Friday.
However, he has received stock options during the year that are currently worth $22 billion.
Tesla Inc (TSLA.O) revealed that Musk’s total compensation last year was nil, as he received no base salary during 2020.
In 2019, Musk’s salary was $23,760 after $56,380 a year earlier.
“However, he has never accepted his salary,” according to an update filed with the SEC on Friday.
“Commencing in May 2019 at Mr. Musk’s request, we eliminated altogether the earning and accrual of this base salary,” it added.
In 2018, Tesla reported Musk’s massive options package value after shareholders first approved a stock-based compensation deal.
The valuation, considered conservative, was conducted using widely accepted methods and placed the options’ value at $2.3 billion.
The compensation agreement gave Musk the right to options, allowing him to purchase up to 101 million split-adjusted shares of stocks at an exercise price of $70.01 each.
Under the 10-year agreement, they were distributed in equal tranches of 8.4 million options based on Musk’s ability to push the company to hit specific operating metrics.
It included 16 operational milestones determined as stock valuation targets.
If the electric car maker reaches 12 of those milestones and Tesla’s market capitalization hits up to $650 billion, Musk’s stock will vest as scheduled.
Tesla claimed that it had reached half of those milestones as of Friday. Additionally, the company’s capitalization surpassed $650 million in 2020 after its shares soared 743%.
On Friday, its market capitalization closed at $704.81 billion.
As four of Musk’s stock tranches vested during 2020, the mogul can buy 33.8 million shares at an exercise price of $2.4 billion.
Those shares were worth $21.9 billion on Friday.
Besides, Tesla has reached two financial milestones this year, qualifying Musk for an additional 16.9 million stock options currently valued at $10.9 billion.
In an earlier filing, the company said it had posted record second-quarter profits, adding that it is “likely” to hit three more financial milestones in the short term.
That scenario would again favor Musk, whose options windfall could reach or exceed the 2020 awards this year.
However, as with most top executives, Musk has not exercised any of the stock options he has obtained.
As of July 30, he had acquired 70.5 million shares and had options to buy another 73.5 million shares, owning over 23% of the company’s shares.
