The new “replacement” pay package that Tesla unveiled for Elon Musk on Aug. 3 marks a big improvement over its predecessor, for a basic reason. It guarantees what the previous version left open—the very real possibility that if Tesla’s stock takes a giant roundtrip back to the price where they gave Musk that huge slug, shareholders get nothing but dilution for the directors’ largesse. And Musk still holds shares worth billions.
Recall that in 2024, in response to a lawsuit from the EV maker’s shareholders, the Delaware courts invalidated the famous giga-grant approved in January of 2018. Musk and the company appealed the ruling, and the decision is now on appeal. The Tesla board stepped in to ensure that if the Tesla side loses, the CEO will get something similar to the numbers he’d sacrifice. But this time, they’re attaching a series of wise conditions absent the first time around.
