Tesla's Denholm on Musk's Pay Package and His Future at Company

Core Viewpoint - The discussion centers around Tesla's annual shareholder meeting, focusing on the performance-based pay package for Elon Musk and the implications of shareholder voting on his leadership and the company's future [2][3][4]. Group 1: Shareholder Engagement - The company emphasizes the importance of engaging with both institutional and retail investors to address their questions and concerns regarding the pay package and future plans [2][9]. - Initial feedback from investors has been mixed, with some expressing optimism while others, like Class Lewis from ICAC, have raised concerns about the substantial financial rewards tied to Musk's performance [3][4]. Group 2: Performance Package Details - The pay package is structured around performance milestones, meaning Musk will not receive compensation unless he meets specific targets set by the board [4][10]. - The board has incorporated a succession plan into the performance package to ensure leadership continuity in case of a negative vote on Musk's pay [7][8]. Group 3: Voting Influence and Leadership - Musk's desire for increased voting influence is highlighted, with the board asserting that he is the right leader for Tesla over the next decade due to his unique skill set in manufacturing and technology [10][28]. - The board acknowledges the potential risk of Musk leaving if the vote does not go in favor of the pay package, indicating that succession planning is a priority [6][10]. Group 4: Financial Goals and Energy Products - The company aims for a monumental adjusted EBITDA target of $400 billion, with energy products playing a crucial role in achieving this goal, although they are not explicitly listed as performance metrics [16][17]. - The board believes that energy is implicitly included in the overall performance goals, despite not being a specific line item [15][17]. Group 5: Compensation and Equity - The board is considering increasing the employee equity pool to attract talent and potentially compensate Musk for the previous compensation plan, which is currently under appeal [19][20]. - The structure of the pay package has been designed to separate voting rights from economic rights, which has been a point of contention among shareholders [22][24].