Musk defends his $55 billion pay award in a Delaware court, in a suit brought by Gregory Vallo, a Tesla shareholder. The plaintiff alleges that the compensation package, which called for Musk to reap billions if Tesla hit certain market capitalization and operational milestones, was approved by Tesla board members who had conflicts interest due to personal and professional ties to Musk.
Musk would receive the full benefit of the pay plan, $55.8 billion, only if Tesla hit a market capitalization of $650 billion and unprecedented revenue and earnings within a decade. To date, Tesla, under Musk’s management, has achieved all 12 of the market capitalization milestones and 11 operational milestones, providing Musk over $52.4 billion in stock option gains
Musk says he did not dicate the terms of the package, or attend any meetings at which the plan was discussed by the board, its compensation committee, or a working group that helped develop it.
I was entirely focused on the execution of the company,
Varallo also questioned Musk about how he splits his time among Tesla and his other companies. Musk said he never intended to be CEO of Tesla, and that he didn’t want to be chief executive of any other companies either, preferring to see himself as an engineer instead.
The suit also alleges the shareholder vote approving the compensation plan was based on a misleading proxy statement.