Elon Musk at the 2020 Satellite Conference and Exhibition March 9 in Washington, DC.

The breathless surge in Tesla shares that gained steam through February raised expectations that CEO Elon Musk would soon hit the first tranche of a jaw-dropping pay package worth at least $55 billion over a decade for hitting performance targets set by Teslas board. He could qualify for a payout of $435 million as early as late April, though the timing is increasingly clouded as Tesla shares plunge amid coronavirus concerns.

Musks long-term compensation package, approved in March 2018, set a series of specific market cap, revenue and adjusted profit targets to be attained over a decade. To receive the maximum payout, Teslas market cap must hit $650 billion, more than six times the current level; annual revenue from Teslas electric vehicles, batteries and solar panels has to be $175 billion, with adjusted earnings of $14 billion. Forbes estimates Musks net worth is $34.6 billion as of March 10.

Payouts to Musk come in the form of a dozen individual awards of about 1.69 million Tesla shares, assuming hes met one of 12 market cap goals, along with revenue and adjusted profit targets. If he falls short in a particular period, he gets nothing. Hes well on his way to fulfilling the first set as Teslas revenue of $24.6 billion in 2019 and annual adjusted pre-tax earnings of at least $1.5 billion represented two operational milestones, the company said in its annual report filed on Feb. 13. At that time, no market capitalization milestones have been achieved.

But Teslas surge that pushed its market cap to $100 billion for the first time on Jan. 22 kept going for more than 30 days. Retaining that level for both 30 days and six-months is looking harder to predict. Currently, Teslas six-month trailing valuation is $80 billion, from Sept. 11 through March 10.

Tesla

U.S. markets were hit particularly hard on March 9, with the Dow Jones Industrial Average down 7.8%, the S&P 500 off 7.6% and the Nasdaq Composite falling 7.3%. Tesla rebounded a bit on Tuesday, up about 6% to $645.33.

Since closing at a record $917.42 on Feb. 19, which inflated Teslas market cap to $168.8 billion, the stock has plunged 31% through March 10, cutting its valuation to $119 billion. If the current level holds for another six weeks, Musk could see his first payout by the end of April. The 1.69 million shares in the first award have an exercise price of $350.02 each, so if Tesla shares were still at the $608 level of March 9, the awards net value for him would be about $435 million.

A review of Musks package by The New York Times in January 2018 called it the boldest pay plan in corporate history. Not to be outdone, Musk himself told the paper: I actually see the potential for Tesla to become a trillion-dollar company within a 10-year period.

In February, as the stock was surging, one estimate calculated the six-month market cap target could come as early as April 17, assuming the shares didnt fall below a Feb. 11 closing price of $774.38. Currently, in a best-case scenario in which the stock stays at or above its current price of $608 a share, Forbes estimates the six-month average could still be met by as early as April 22. But with ongoing market turbulence as companies and investors try to get a grasp of the scope of economic damage from the COVID-19 outbreak, the odds of that happening are getting tougher.

Musk hasnt commented directly on either his pay package or stock drop recently, though he lashed out at coronavirus panic late last week, telling his 32 million Twitter followers on March 6 the coronavirus panic is dumb.

That drew a rebuke from former options trader and risk analyst Nassim Nicholas Taleb, best known for his book The Black Swan:The Impact of the Highly Improbable, who told Musk on Twitter saying the coronavirus panic is dumb is dumb.

Aside from his potential disappointment of a delayed stock payout, the often sleep-deprived Musk may have even more on his mind these days than the usual challenges of running both Tesla and SpaceX. His romantic partner, Canadian singer Grimes, told Rolling Stone in an interview this month that shes pregnant with Musks sixth child.

Regardless, he was more sanguine about stock exchange turbulence on March 9, tweeting market was bit high anyway, so due for a correction.

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Elon Musks Drive To $55 Billion Tesla Payday Slowed By COVID-19 Stock Slide - Forbes