Or you just allow the CEO to pump and dump the company, because the 1%/year stock will be absolutely massive while riding the hype and when things go south he can just quit and buy half the bahamas. There are much better ways to tie CEO performance to company performance that don't include amputating company stock every time your CEO is paid.
It is a $50B a year target for 12 years, so ya if he "pumped" up the stock by pretty much doubling the current market cap 2 full times over the next 4 years then he could "dump" it straight away. So the argument is that taking the company from ~50B to $650B would create such shareholder value that it would be worth it. It is actually tied to revenue and profit as well.
> Tesla has set a dozen targets, each $50 billion more than the next, starting at $100 billion, then $150 billion, then $200 billion and so on, all the way to a market value of $650 billion. In addition, the company has set a dozen revenue and adjusted profit goals. Mr. Musk would receive 1.68 million shares, or about 1 percent of the company, only after he reaches milestones for both. [1]
reply