By Zaeem Shoaib

Tesla shareholder Baron Capital will vote in favor of Elon Musk's $56 billion pay package at the upcoming June 13 shareholder meeting.

The asset management firm's holdings of Tesla shares account for about 7% to 8% of its total assets, Baron Capital Chairman and Chief Executive Ron Baron said in an interview on CNBC's Squawk Box.

Baron Capital's assets under management totaled $43 billion, according to its report for the first quarter.

"I think in the next 10 years, we'll probably make four to five times our money again in Tesla," Baron said in the interview.

The CEO has previously said Baron Capital made about 20 times its investment in Tesla since initially buying the stock in 2014, according to CNBC.

The CEO also wrote an open letter urging shareholder to vote in favor of the pay package again, and criticized investor Richard Tornetta's lawsuit against the compensation package.

The lawsuit resulted in a Delaware judge invalidating the pay package in January, after which Musk has sought to move Tesla's state of incorporation to Texas from Delaware.

"The voice of shareholders and legally binding contracts should not be permitted to be undone by a shareholder for hire and his strike suit lawyers," Baron said.

Without naming Tornetta, Baron said in the letter that the plaintiff shareholder owned nine Tesla shares, and the lawyers who represented him requested $5.6 billion in fees to paid in Tesla shares.

Baron said the contract for the compensation package had "aggressive performance metrics that few in 2018 believed could be achieved," and that Musk would have received nothing if those targets were not met.

"Elon is the ultimate 'key man' of key man risk. Without his relentless drive and uncompromising standards, there would be no Tesla," Baron said in the letter.

Baron believes Musk should have a similar contract going forward where he is incented the same way, he told CNBC.

Write to Zaeem Shoaib at

(END) Dow Jones Newswires

06-05-24 1215ET