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See How a Tesla-SpaceX Merger Gives Musk a Shortcut to His $1 Trillion Payday
Elon Musk could bypass specific performance hurdles to secure his $1 trillion Tesla pay package if the company is acquired or taken over.
What: A clause in Musk's compensation agreement treats half of his performance targets as satisfied in the event of an acquisition, leaving only market capitalization thresholds to determine his total share payout.
Why it matters: This structural detail illustrates how executive compensation contracts often contain 'change-of-control' provisions that fundamentally alter payout logic during M&A events.
Original article
The conditions for Elon Musk to receive his $1 trillion pay package at Tesla could easily be achieved if the company were acquired. There is a clause in the agreement that declares half the targets as good as accomplished if Tesla is acquired or otherwise taken over. This leaves only market-value targets to determine how many shares Musk gets. Musk has considerable say over any offer SpaceX makes for Tesla. Even a stratospheric bid would keep Musk in firm control of the combined company.
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