Elon Musk's $56B Pay Package
A $56 billion compensation plan for Elon Musk, initially approved by Tesla shareholders in 2018, which was later voided by a Delaware judge and then re-approved by shareholders in June 2024.
First Mentioned
10/12/2025, 5:23:16 AM
Last Updated
10/12/2025, 5:24:37 AM
Research Retrieved
10/12/2025, 5:24:37 AM
Summary
Elon Musk's $56 billion pay package, originally from 2018, was recently re-approved by Tesla shareholders, a decision that also included the relocation of the company's incorporation from Delaware to Texas. This re-approval acts as a significant rebuke to a Delaware judge who had previously voided the initial agreement, reflecting broader corporate dissatisfaction with Delaware's legal environment. The pay structure, which involves stock options, was defended by David Friedberg as a superior model for CEO compensation that effectively aligns executive incentives with shareholder value, despite opposition from institutional investors like Calpers.
Referenced in 1 Document
Research Data
Extracted Attributes
CEO
Elon Musk
Value
$56 billion
Company
Tesla
Compensation Type
Stock options
Legal Challenge Basis
Breach of fiduciary duty
New Incorporation State
Texas, USA
Original Agreement Year
2018
Original Incorporation State
Delaware, USA
Legal Challenge Outcome (initial)
Voided by Delaware judge
Shareholder Vote Outcome (re-approval)
Re-approved
Timeline
- The original agreement for Elon Musk's $56 billion pay package was made. (Source: related_documents, web_search_results)
2018
- A Delaware judge voided the original 2018 agreement for the pay package. (Source: related_documents, web_search_results)
Date not specified
- Tesla shareholders voted to re-approve Elon Musk's $56 billion Pay Package. (Source: related_documents)
Date not specified
- Tesla shareholders approved moving the company's incorporation from Delaware to Texas. (Source: related_documents)
Date not specified
Wikipedia
View on WikipediaList of unicorn startup companies
This is a list of unicorn startup companies: In finance, a unicorn is a privately held startup company with a current valuation of US$1 billion or more. Notable lists of unicorn companies are maintained by The Wall Street Journal, Fortune Magazine, CNNMoney/CB Insights, TechCrunch, PitchBook/Morningstar, and Tech in Asia. Africa has a growing number of unicorn startups led by Nigeria, South Africa, Morocco, Egypt, and Kenya, each country consisting of one or two unicorn startups.
Web Search Results
- Delaware Court Strikes Down Musk's $56 Billion Pay Package
[Manage options](https://www.meridiancp.com/insights/delaware-court-strikes-down-musks-56-billion-pay-package/#)[Manage services](https://www.meridiancp.com/insights/delaware-court-strikes-down-musks-56-billion-pay-package/#)[Manage {vendor_count} vendors](https://www.meridiancp.com/insights/delaware-court-strikes-down-musks-56-billion-pay-package/#)[Read more about these purposes](https://cookiedatabase.org/tcf/purposes/) Accept Deny View preferences Save preferences[View preferences](https://www.meridiancp.com/insights/delaware-court-strikes-down-musks-56-billion-pay-package/#) [Opt-out preferences](https://www.meridiancp.com/opt-out-preferences/)[Privacy Statement](https://www.meridiancp.com/privacy-statement-us/)[{title}](https://www.meridiancp.com/insights/delaware-court-strikes-down-musks-56-billion-pay-package/#) [Skip to content](https://www.meridiancp.com/insights/delaware-court-strikes-down-musks-56-billion-pay-package/#main)Close * [Contact](https://www.meridiancp.com/insights/delaware-court-strikes-down-musks-56-billion-pay-package/#contact) [Download as PDF](https://www.meridiancp.com/app/uploads/2024/02/TNU-2024-4-Delaware-Court-strikes-down-Musks-mult-billion-dollar-pay-package-1.pdf) Despite this outsized gain in market capitalization, a Tesla shareholder filed a derivative shareholder suit in Delaware Court claiming that Musk and Tesla (and its Board and compensation committee) breached their fiduciary duty by awarding the stock options to Mr. Musk and asked the court to rescind the grant. [Client Alerts 4 Min Read #### Tesla Attempts to Reinstate Musk Option Grant Through Shareholder Ratification](https://www.meridiancp.com/insights/tesla-attempts-to-reinstate-musk-option-grant-through-shareholder-ratification/)[Client Alerts 6 Min Read #### Delaware Court Rejects Musk’s Pay Package for Second Time](https://www.meridiancp.com/insights/delaware-court-rejects-musks-pay-package-for-second-time/)[Client Alerts 3 Min Read #### Tesla Shareholders Ratify Musk’s Option Grant](https://www.meridiancp.com/insights/tesla-shareholders-ratify-musks-option-grant/)
- Tesla offers mammoth $1 trillion pay package to Musk, sets lofty ...
[Skip to main content](https://www.reuters.com/business/autos-transportation/tesla-offers-mammoth-1-trillion-pay-package-musk-sets-lofty-targets-2025-09-05/#main-content) [](https://www.reuters.com/) * [World](https://www.reuters.com/world/) [Browse World](https://www.reuters.com/world/) * [United States](https://www.reuters.com/world/us/) * [Business](https://www.reuters.com/business/) [Browse Business](https://www.reuters.com/business/) * [Take Five](https://www.reuters.com/business/take-five/) * [Markets](https://www.reuters.com/markets/) [Browse Markets](https://www.reuters.com/markets/) * [ETFs](https://www.reuters.com/markets/etf/) * [Stocks](https://www.reuters.com/markets/stocks/) * [U.S. Markets](https://www.reuters.com/markets/us/) [Technology](https://www.reuters.com/technology/) * [Space](https://www.reuters.com/technology/space/) [Live](https://www.reuters.com/live/) [Video](https://www.reuters.com/video/) Sept 5 (Reuters) - Tesla's [(TSLA.O), opens new tab](https://www.reuters.com/markets/companies/TSLA.O) board has proposed a $1 trillion compensation plan for CEO Elon Musk in what would be the largest corporate pay package in history, underscoring the hold Musk has over the carmaker as it attempts to transform into an AI and robotics powerhouse. Sign up [here.](https://www.reuters.com/newsletters/reuters-auto-file/?location=article-paragraph&redirectUrl=%2Fbusiness%2Fautos-transportation%2Ftesla-offers-mammoth-1-trillion-pay-package-musk-sets-lofty-targets-2025-09-05%2F) REUTERS/Tingshu Wang/File Photo [Purchase Licensing Rights, opens new tab](https://www.reutersconnect.com/item/teslas-ceo-elon-musk-in-beijing/dGFnOnJldXRlcnMuY29tLDIwMjM6bmV3c21sX1JDMkM5MUEwQUEzWg%3D%3D/?utm_medium=rcom-article-media&utm_campaign=rcom-rcp-lead) * [](https://www.reuters.com/business/autos-transportation/tesla-offers-mammoth-1-trillion-pay-package-musk-sets-lofty-targets-2025-09-05/hoodieonveshti) [Business](https://www.reuters.com/business/) * [Home](https://www.reuters.com/) * [Topic Sitemap](https://www.reuters.com/sitemap/topics/) * [World](https://www.reuters.com/world/) * [Business](https://www.reuters.com/business/) * [Markets](https://www.reuters.com/markets/) * [Technology](https://www.reuters.com/technology/) * [Videos](https://www.reuters.com/video/) * [](https://www.facebook.com/Reuters) * [](https://www.instagram.com/Reuters)
- Inside Tesla's $1 trillion pay proposal for CEO Elon Musk | Reuters
[Skip to main content](https://www.reuters.com/business/autos-transportation/inside-teslas-1-trillion-pay-proposal-ceo-elon-musk-2025-09-05/#main-content) [](https://www.reuters.com/) * [World](https://www.reuters.com/world/) * [Business](https://www.reuters.com/business/) [Browse Business](https://www.reuters.com/business/) * [Take Five](https://www.reuters.com/business/take-five/) * [Markets](https://www.reuters.com/markets/) [Browse Markets](https://www.reuters.com/markets/) * [Stocks](https://www.reuters.com/markets/stocks/) * [Sustainability](https://www.reuters.com/sustainability/) [Sports](https://www.reuters.com/sports/) * [Tesla Inc](https://www.reuters.com/company/tesla-inc/)Follow Sept 5 (Reuters) - Tesla [(TSLA.O), opens new tab](https://www.reuters.com/markets/companies/TSLA.O) outlined a [$1 trillion](https://www.reuters.com/business/autos-transportation/tesla-offers-mammoth-1-trillion-pay-package-musk-sets-lofty-targets-2025-09-05/) compensation plan for CEO Elon Musk on Friday, which pays out if he is able to grow the EV company's market capitalization from about $1.1 trillion to $8.5 trillion and to hit several operational targets. Sign up [here.](https://www.reuters.com/newsletters/reuters-auto-file/?location=article-paragraph&redirectUrl=%2Fbusiness%2Fautos-transportation%2Finside-teslas-1-trillion-pay-proposal-ceo-elon-musk-2025-09-05%2F) Ad Break Coming UpNEXT Stay Next Off English 180p 288p 360p 480p 540p 576p 720p HD 1080p HD Auto (180p)About Connatix V2049621718 About Connatix V2049621718 1/1 Skip Ad Continue watching after the adVisit Advertiser website[GO TO PAGE](https://www.reuters.com/business/autos-transportation/inside-teslas-1-trillion-pay-proposal-ceo-elon-musk-2025-09-05/#)
- Elon Musk's record Tesla package will pay him tens of billions even ...
If Musk sells 1.2 million cars a year over the next decade, on average, he earns $8.2 billion in stock if Tesla's market value grows from $1.4 trillion today to $2 trillion in 2035, well under long-term market-average growth. He pointed out, however, that Tesla's value is already largely based on "future products that don't exist today." For Musk to claim the biggest payouts offered by Tesla's board, Goldstein said, "we're going to start having to see real products." Kevin Murphy, a University of Southern California finance professor and an expert witness for Tesla in defending Musk's 2018 pay package, acknowledged that the vehicle sales and $2 trillion valuation goals aren't "much of a stretch" but simply reaching those won't appease shareholders.
- The Trillion Dollar Man? Comparing Musk's 2018 Pay Plan to His ...
On Friday, Tesla announced in an SEC filing that the Company is proposing to grant its CEO Elon Musk an equity award that could make him a trillionaire. In light of the news, Equilar examined the key elements from Musk’s 2018 pay package and the latest award from Tesla, highlighting the differences in plan details and target performance goals. While the 2018 award asked Musk to raise Tesla’s market cap from $54 billion to $650 billion, the 2025 award will only vest in full if the Company’s market cap jumps from roughly $1 trillion to $8.5 trillion. However, with the 2025 award, Tesla and Musk entered into a voting agreement by which Musk will be able to vote with earned shares once milestones are achieved, regardless of whether the shares have vested or not.