Musk Sells Additional Tesla Shares Worth 1 Trillion Won

▲Elon Musk, CEO of Tesla [Image source=AP News]

[Asia Economy Reporter Kwon Jae-hee] Elon Musk, founder and CEO of Tesla, has sold an additional $930 million worth of Tesla shares following the disposal of $6.9 billion (approximately 8.1 trillion KRW) worth of Tesla stock.

According to major foreign media on the 15th (local time), Musk disclosed through a filing that he exercised stock options for 2.1 million shares at $6.24 per share to cover tax payments arising from the exercise of stock options, and sold 934,091 of those shares.

On the 8th, Musk also exercised stock options for 2.2 million shares and sold 934,000 shares, earning $1.1 billion.

Musk currently holds stock options for approximately 22.86 million shares that will expire if not exercised by August next year. When exercising stock options, taxes must be paid based on the profit calculated using the stock price at the time of exercise.

Earlier, on the 6th, Musk posted a surprise tweet asking whether he should sell 10% of his Tesla holdings ahead of the U.S. Congress's discussion on a wealth tax, and from the 8th, he sold $6.9 billion worth of Tesla shares over five consecutive days.

Major foreign media reported that Musk sold 6.36 million Tesla shares last week and would need to sell about 10 million more shares to fulfill his promise to dispose of 10% of his holdings.

On the same day, Tesla's stock price briefly dropped to "900-sla" during the New York stock market session but barely recovered to "1,000-sla" and a market capitalization of $1 trillion as buying interest surged at the end of trading.

The closing price of Tesla shares that day was $1,013.39, down 1.94% from the previous session.

Meanwhile, Bloomberg News and others reported that JPMorgan Chase has filed a lawsuit seeking $162 million (approximately 191 billion KRW) in damages, alleging Tesla violated a warrant agreement.

JPMorgan stated that Tesla entered into a contract in 2014 to pay shares or cash if the stock price was higher than the exercise price at the warrant expiration dates in June and July of this year.

According to the complaint filed with the U.S. District Court in Manhattan, New York, JPMorgan claims that Musk's 2018 tweet stating "Tesla is considering going private" constituted a significant corporate event that could adjust the exercise price.

At that time, JPMorgan lowered the exercise price to maintain equivalent fair market value after Musk's tweet, but when Musk abandoned the privatization plan, the exercise price was readjusted to reflect the stock price increase, the complaint explained.

However, JPMorgan alleges that Tesla has refused to acknowledge the adjusted exercise price despite it being a proper contractual measure and has failed to pay the $162 million due under the contract upon expiration.

JPMorgan also added that the stock price at the expiration date was higher than both the original and adjusted exercise prices.

In February 2019, Tesla sent a letter to JPMorgan criticizing the exercise price adjustment as unreasonably rapid and accusing it of being an opportunistic attempt to exploit Tesla's stock price volatility.

This content was produced with the assistance of AI translation services.