Musk Record Tesla Pay Plan Rejected Again by Delaware Judge

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18. The pay package was obscene, but it was not $56 billion per year on $96 billion annual revenues.

The pay package, originally approved in 2018, was a ten year compensation package that awarded Musk stock options. The options were divided into 12 "tranches" -- how many option shares he was entitled to claim depended on whether the company met certain financial and operational goals. Ultimately, after taking into account stock splits, the package granted stock option awards for approximately 304 million shares that Musk can buy at about $23.33 each. The company met the target on all 12 tranches of stock option awards but, to the best of my knowledge, Musk hasn't exercised any of the options. Under the terms of the pay package, once he exercises the options he is required to hold the shares for at least five years before selling. The pay package did not award him any guaranteed salary.

That's much different than paying him $56 billion a year. But it still was an unconscionable award that would dilute the value of the shares held by other stockholders.