Part 2/10:
Musk exercised 10,500 shares of Tesla stock, an exercise valued at less than two million dollars. Notably, these options originated from a company-wide patent incentive program dating back to 2013. The timing of these exercises is crucial because Musk is incentivized to exercise options at the lowest Tesla stock price possible. This is financially advantageous since exercising at a lower price minimizes tax liabilities—the difference between the exercise price and current stock value is taxed as ordinary income, while gains upon sale are taxed as capital gains, which is typically lower.