SpaceX founder and Tesla CEO Elon Musk holds a helmet as he visits the development website online of Tesla’s gigafactory in Gruenheide, close to Berlin, Germany, Might 17, 2021.
Michele Tantussi | Reuters
Elon Musk unleashed a torrent of inventory gross sales, choices workout routines, tax fee gross sales and talented stocks final 12 months totaling just about $22 billion. But even after unloading such a lot Tesla inventory, he nonetheless owns a bigger proportion of the corporate, due to his reimbursement bundle.
Musk offered $16 billion in stocks final 12 months and, in keeping with a submitting with the U.S. Securities and Trade Fee Monday, talented 5 million stocks, which can be price just about $6 billion, to an undisclosed charity or recipient in November. The gross sales and presents deliver his overall to about $22 billion — a mix of tax bills, money in his pocket and the present.
But on account of the character of the choices workout routines, Musk in reality completed the 12 months with a bigger possession stake — and extra stocks — in Tesla. In 2012, Musk used to be awarded choices on 22.8 million stocks price about $28 billion final fall when he began promoting.
The best way the choices workout routines paintings is that Musk first began changing the 22.8 million choices into stocks. The choices had a strike value of most effective $6.24, so he may just pay $6.24 for each and every possibility and get a proportion of Tesla inventory, that have been buying and selling at greater than $1,000 final fall.
With each and every choices conversion, he would concurrently promote stocks to pay the taxes, because the choices are taxed as source of revenue. Whilst he used to be unloading billions of greenbacks price of stocks to pay the taxes, he used to be gathering a fair greater quantity of inventory on the low choices value — thus expanding his possession of the corporate.
In overall, Musk offered 15.7 million stocks for $16.4 billion. Upload to that the talented stocks, and he unloaded a complete of 20.7 million stocks. But he won 22.8 million stocks in the course of the choices workout — leaving him with 2 million extra stocks in Tesla on the finish of the 12 months. He these days owns 172.6 million stocks, which provides him a 17% stake within the corporate, making him a long way and away the one biggest particular person shareholder.
Musk kicked off his proportion task with a ballot on Nov. 6, telling his fans “A lot is made in recent years of unrealized positive aspects being a method of tax avoidance, so I suggest promoting 10% of my Tesla inventory. Do you reinforce this?” Musk vowed to observe the result of the ballot, which ended up with 58% in want of a sale and 42% in opposition to.
After all, he made excellent at the promise of marketing 10% of his stake. However he won much more again with choices, which gave him a round-trip-stock day trip that left him with billions in money, the biggest unmarried tax fee in U.S. historical past and much more Tesla stocks.
Musk’s possession — and $227 billion fortune — is more likely to skyrocket once more sooner or later. His subsequent giant pay bundle, which might be even greater than the 2012 award, expires in 2028.