Chinese electric vehicle (EV) maker Li Auto (NASDAQ: LI), taking a page from Tesla, is giving its chairman and CEO Li Xiang options to purchase 108,557,400 Class B ordinary shares based on his performances.

The exercise price of the options is US$14.63 per share, or US$29.26 per ADS, which is equal to the average closing price for its American depositary shares of the thirty trading days prior to the grant date, the company announced on Tuesday.

To better align the company's long-term strategies and the shareholders' best interests, the options are vesting entirely contingent on achieving delivery targets, the company said.

The granted options are divided into six equal tranches, or 18,092,900 each:

The first tranche will become vested when the aggregate number of the Company's vehicle deliveries in any 12 consecutive months exceeds 500,000.

The second to sixth tranches will become vested when the aggregate number of the Company's vehicle deliveries in any 12 consecutive months exceeds 1,000,000, 1,500,000, 2,000,000, 2,500,000, and 3,000,000, respectively.

Li Auto delivered 2,300 units of the Li ONE, its only model, in February, down 57 percent from January and up 755 percent from a year ago.

As of February 28, Li ONE has accumulated more than 40,000 deliveries, reaching 41,276 units. In 2020, deliveries of Li ONEs reached 32,624 vehicles.

The company also announced that the board of directors and the compensation committee adopted a 2021 Share Incentive Plan. The maximum number of Class B ordinary shares of the company that may be issued pursuant to all awards under the 2021 Plan is 108,557,400.

In March 2018, Tesla shareholders awarded 12 tranches of a $2.6 billion equity incentive plan to CEO Elon Musk, tying Tesla's business performance, market performance, and Musk's personal prestige and wealth.

(Source: Li Auto)