4 ms·

Yes and no. He still owns ~400M shares and had options on 304M more. The 304M just got cancelled. He has around 260M shares pledged as collateral against his

Yes and no. He still owns ~400M shares and had options on 304M more. The 304M just got cancelled. He has around 260M shares pledged as collateral against his loans - at least according to the latest known numbers (from 2022 I believe). So let's say he's not yet under water, but the margin just got dangerously close to the limit.

fooey 3y ago
According to the Tesla bylaws, you can only leverage 25% of your stock, so that's going to be a problem for him too https://www.sec.gov/Archives/edgar/data/1318605/000156459021022604/tsla-10ka_20201231.htm https://www.sec.gov/Archives/edgar/data/1318605/000156459021... > In order to mitigate the risk of forced sales of pledged shares, the Board has a policy that limits pledging of Tesla stock by our directors and executive officers. Pursuant to this policy, directors and executive officers may pledge their stock (exclusive of options, warrants, restricted stock units or other rights to purchase stock) as collateral for loans and investments, provided that the maximum aggregate loan or investment amount collateralized by such pledged stock does not exceed twenty-five percent (25%) of the total value of the pledged stock.
- ksherlock 3y ago
  Not a problem when you can ask your friends to rewrite the rules. My favorite story: FedEx doesn't allow BoD/executives to pledge stock for margin loans. But they will make exceptions on a case-by-case basis. They only made on exception, (then) CEO Fred Smith. How it started: "In accordance with our policy, Mr. Smith has established his financial capacity to repay the loan without resorting to the pledged shares. In the unlikely event such a sale were necessary, based on the 30-day average trading volume for FedEx shares as of August 4, 2014, it would take two days for the pledged shares to be sold in the open market. Furthermore, Mr. Smith’s unpledged share ownership is very substantial and would likely be able to prevent any margin call." How it went: "As a result of the stock price decline during fiscal 2020, Mr. Smith was granted approval to pledge additional shares in March 2020."
- kortilla 3y ago
  Right in your own quote, options were excluded so this doesn’t alter that.
fred_is_fred 3y ago
Thank you. I've been looking for this in every news story posted since the verdict. Does anyone know where the cancelled shares go? Back to Tesla? I assume he can get a massive tax refund now?
- microtherion 3y ago
  These are options, not shares, so I think they simply cease to exist.
  - s1artibartfast 3y ago
    The options cease to exist. Tesla has 50 billion is shares earmarked for elon, which it no longer has to pay out, this means the shareholders made 50B
    - deleted 3y ago
      [deleted]

fooey 3y ago

According to the Tesla bylaws, you can only leverage 25% of your stock, so that's going to be a problem for him too https://www.sec.gov/Archives/edgar/data/1318605/000156459021022604/tsla-10ka_20201231.htm https://www.sec.gov/Archives/edgar/data/1318605/000156459021... > In order to mitigate the risk of forced sales of pledged shares, the Board has a policy that limits pledging of Tesla stock by our directors and executive officers. Pursuant to this policy, directors and executive officers may pledge their stock (exclusive of options, warrants, restricted stock units or other rights to purchase stock) as collateral for loans and investments, provided that the maximum aggregate loan or investment amount collateralized by such pledged stock does not exceed twenty-five percent (25%) of the total value of the pledged stock.

ksherlock 3y ago
Not a problem when you can ask your friends to rewrite the rules. My favorite story: FedEx doesn't allow BoD/executives to pledge stock for margin loans. But they will make exceptions on a case-by-case basis. They only made on exception, (then) CEO Fred Smith. How it started: "In accordance with our policy, Mr. Smith has established his financial capacity to repay the loan without resorting to the pledged shares. In the unlikely event such a sale were necessary, based on the 30-day average trading volume for FedEx shares as of August 4, 2014, it would take two days for the pledged shares to be sold in the open market. Furthermore, Mr. Smith’s unpledged share ownership is very substantial and would likely be able to prevent any margin call." How it went: "As a result of the stock price decline during fiscal 2020, Mr. Smith was granted approval to pledge additional shares in March 2020."
kortilla 3y ago
Right in your own quote, options were excluded so this doesn’t alter that.

fred_is_fred 3y ago

Thank you. I've been looking for this in every news story posted since the verdict. Does anyone know where the cancelled shares go? Back to Tesla? I assume he can get a massive tax refund now?

microtherion 3y ago
These are options, not shares, so I think they simply cease to exist.
- s1artibartfast 3y ago
  The options cease to exist. Tesla has 50 billion is shares earmarked for elon, which it no longer has to pay out, this means the shareholders made 50B
  - deleted 3y ago
    [deleted]