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Delaware Court of ChanceryCase No. 12711-VCSIn Re Tesla Motors, Inc. Stockholder Litigation

Document 328, Attachment 2

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EXHIBIT 13

CONFIDENTIAL

1 IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE2 ----------------------------------------------3 IN RE: TESLA MOTORS, INC. Consolidated4 STOCKHOLDER LITIGATION C.A. No. 12711-VCS56 ----------------------------------------------7891011 CONFIDENTIAL121314 VIDEO-RECORDED DEPOSITION OF IRA EHRENPREIS15 WEDNESDAY, MAY 29, 201916171819202122 Reported by:23 Anrae Wimberley24 CSR No. 777825 Job No. NY 3293068

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Veritext Legal Solutions212-267-6868 www.veritext.com 516-608-2400

CONFIDENTIAL

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1 IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

2 ----------------------------------------------

3 IN RE: TESLA MOTORS, INC. Consolidated

4 STOCKHOLDER LITIGATION C.A. No. 12711-VCS

5

6 ----------------------------------------------

7

8

9

10

11 CONFIDENTIAL

12

13

14 Transcript of video-recorded deposition

15 of IRA EHRENPREIS, taken at WilmerHale LLP, 950 Page

16 Mill Road, Palo Alto, California 94304, beginning at

17 9:35 a.m. and ending at 3:58 p.m. on Wednesday, May

18 29, 2019, before Anrae Wimberley, Certified

19 Shorthand Reporter No. 7778.

20

21

22

23

24

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1 APPEARANCES:

2 For Plaintiffs:

3 ROBBINS GELLER RUDMAN & DOWD LLP

4 BY: RANDALL BARON, ESQ.

5 MAXWELL R. HUFFMAN, ESQ.

6 655 West Broadway, Suite 1900

7 San Diego, California 92101

8 (619) 231-1058

9 [email protected]

10 [email protected]

11

12 For Tesla Motors Director Defendants and the

13 deponent:

14 CRAVATH, SWAINE & MOORE LLP

15 BY: EVAN CHESLER, ESQ.

16 KATHRYN BALDWIN, ESQ.

17 825 Eighth Avenue

18 New York, New York 10019-7475

19 (212) 474-1243



22

23

24

25

1 Also Present:2 VERITEXT LEGAL SOLUTIONS3 DAVID HALVORSON, VIDEOGRAPHER4 (415) 274-99775 [email protected] LYNN MILLER, In-house counsel for Tesla,8 Inc.9

10 --oOo--111213141516171819202122232425

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1 I N D E X2 EXAMINATION BY: PAGE3 MR. BARON 10, 12545 --oOo--6 E X H I B I T S78 EXHIBIT DESCRIPTION PAGE9 Exhibit 1 E-mail dated 11/16/15 from 15

10 Sagisi to Ehrenpreis11 w/attachment; Bates12 TESLADIR0028182 thru 183,13 22 total pages1415 Exhibit 2 DBL Partners website printout; 4916 12 pages1718 Exhibit 3 E-mail string of August 2016; 6019 Bates TESLADIR0043575 thru 5762021 Exhibit 4 E-mail string of September 2015; 6422 Bates TESLA00003404 thru 4052324 Exhibit 5 E-mail string of February 2016; 7425 Bates TESLA00007561 thru 563

2 (Pages 2 - 5)


CONFIDENTIAL

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1 E X H I B I T S (Cont'd)2 EXHIBIT DESCRIPTION PAGE3 Exhibit 6 E-mail dated 7/13/16 from Wooten 1054 to Tappin w/attachment; Bates5 LAZ_TES00085033 thru 03467 Exhibit 7 Lazard presentation entitled, 1158 Project Daedalus; Bates9 LAZ_TES00039341 thru 354

1011 Exhibit 8 E-mail dated 11/17/16 from 15212 Borenstein to Wheeler; Bates13 TESLA00095530 thru 5311415 Exhibit 9 E-mail dated 10/7/16 from Senay 16716 to Evanson; Bates TESLA00038955,17 16 total pages1819 Exhibit 10 E-mail string of February 2016 18020 w/attachment; Bates TESLA003595021 thru 951, 12 total pages22232425

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1 E X H I B I T S (Cont'd)2 EXHIBIT DESCRIPTION PAGE3 Exhibit 11 Minutes of a Special Meeting of 1874 the Board of Directors of Tesla5 held 2/29/16; Bates6 TESLA00001346 thru 34778 Exhibit 12 Minutes of a Regular Meeting of 1959 the Board of Directors of Tesla

10 held 5/31/16; Bates11 TESLA00001455 thru 4581213 Exhibit 13 Tesla Board of Directors Meeting 20914 documents, 6/20/16; Bates15 TESLA00000001 thru 1221617 Exhibit 14 Minutes of a Special Meeting of 21918 the Board of Directors of Tesla19 held 6/20/16; Bates20 TESLA00001459 thru 4682122 Exhibit 15 Tesla Board of Directors Meeting 22023 documents, 7/22/16; Bates24 TESLA00001360 thru 44525

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1 E X H I B I T S (Cont'd)

2 EXHIBIT DESCRIPTION PAGE

3 Exhibit 16 Tesla Board of Directors Meeting 238

4 documents, 7/30/16; Bates

5 TESLA00001112 thru 322

6

7 --oOo--

8

9 QUESTIONS WITNESS INSTRUCTED NOT TO ANSWER:

10 (None)

11

12 --oOo--

13

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1 WEDNESDAY, MAY 29, 2019; PALO ALTO, CALIFORNIA;

2 9:35 A.M.

3 THE VIDEOGRAPHER: Good morning.

4 We are on the record at 9:35 a.m. on

5 May 29th, 2019.

6 This is Video Unit 1 in the recorded

7 deposition of Ira Ehrenpreis in the In Re Tesla

8 Motors Inc. Stockholder Litigation filed in the

9 Court of the Chancery for the State of Delaware,

10 with the Case No. 12711-VCS.

11 This deposition is being held at

12 WilmerHale located at 950 Page Mill Road in Palo

13 Alto.

14 My name is David Halvorson. I'm the

15 videographer. I'm from Veritext. I'm here with the

16 court reporter, Anrae Wimberley, also from Veritext.

17 Counsel, can you please all identify

18 yourselves so the witness can be sworn in.

19 MR. BARON: Sure. Randall Baron, Robbins

20 Geller Rudman & Dowd, for plaintiffs.

21 MR. HUFFMAN: Maxwell Huffman, Robbins Geller

22 Rudman & Dowd, for plaintiffs.

23 MR. CHESLER: Evan Chesler, Cravath Swaine &

24 Moore, for defendants.

25 MS. BALDWIN: Katie Baldwin, Cravath Swaine &

3 (Pages 6 - 9)


CONFIDENTIAL

Page 10


2 MS. MILLER: Lynn Miller, Tesla.

3 MR. BURGER: Corby Burger with Cravath Swaine &


5 IRA EHRENPREIS,

6 sworn as a witness by the Certified

7 Shorthand Reporter, testified as follows:

8 EXAMINATION

9 BY MR. BARON:

10 Q. Mr. Ehrenpreis, is it fair to say that

11 Mr. Musk has had a significant influence on your

12 professional career?

13 A. Yes.

14 Q. Is there anyone that you can identify that

15 has had a more significant role in your professional

16 career than Elon Musk?

17 A. There are several, sure.

18 Q. Name me one that we can use as a baseline.

19 A. Sure. Ted Ardell.

20 Q. Who is Ted Ardell?

21 A. Ted was a partner for 20-plus years.

22 Q. At what -- partner at where?

23 A. A partner at Technology Partners.

24 Q. Okay. So with regard to Ted Ardell, did

25 you ever invest any money with any companies or any

Page 11

1 businesses Ted Ardell was involved in?2 A. Well, Ted was my partner at a venture3 capital firm, so every company the firm invested in4 invested together.5 Q. Yeah, but you didn't put any money into6 any businesses or any ventures of Ted Ardell's.7 They were joint ventures that you were investing in8 together; correct?9 A. Yes.

10 Q. Let's take a step back.11 When did you meet Elon Musk?12 A. It was in 2007.13 Q. And how did you meet Elon Musk?14 A. I met him in the context of doing due15 diligence on Tesla.16 Q. And in the context of doing due diligence,17 you ultimately chose to invest in Tesla; correct?18 A. I did.19 Q. How much did you invest?20 A. I'd have to go back to figure out the21 breakdown. We ultimately invested, over the course22 of the company's pre-IPO life, about 13 1/2 million,23 approximately. And initially I think it was closer24 to 8 million of that.25 Q. And -- now, did Mr. Ardell invest with you

Page 12

1 in those Tesla investments, or was that done alone?2 A. Every investment we did at Technology3 Partners was as a partnership, not individually. So4 Ted and I as partners were among the partners that5 invested the fund's capital, and that was one of the6 investments in the fund.7 Q. And Technology Partners, did that turn8 into DBL, or how was that set up?9 A. No, Technology Partners and DBL are wholly

10 unrelated.11 Q. Okay. What happened to Technology12 Partners?13 A. Technology Partners is managing out its --14 the remainder of its funds, so the remainder of its15 companies in the funds that it raised.16 Q. Okay. And how much under management did17 Technology Partners have?18 A. I'm going to have to add up the cumulative19 funds. There were eight funds over 20-plus -- more20 than 20-plus years. I would have to add it up. But21 probably close -- somewhere between a half a billion22 and three-quarters of a billion dollars.23 Q. Tell me -- explain to me how DBL started.24 A. DBL was -- so the way you manage your25 venture capital firms is you raise a pool of assets,

Page 13

1 you deploy those assets. And you raise them

2 typically over a period of time. Once you have

3 finished deploying those assets, you then decide do

4 you want to do it again with your current partners

5 or do you want to do something different?

6 So DBL was post Technology Partners as I

7 was deciding what to do next. I had worked with

8 Nancy Pfund. I had known her for years in the

9 industry. She was going to raise a fund in her

10 prior existence, which was known as DBL Investors.

11 I had been doing Technology Partners, and

12 we decided together to go raise -- to build a new

13 firm with a new name, a new management structure and

14 raise DBL Partners.

15 Q. Was all of your investment in Tesla

16 through Technology Partners or was that also through

17 DBL?

18 A. 100 percent through Technology Partners.

19 Q. And when was the last time you raised

20 funds for Technology Partners?

21 A. 2007, I believe. 2006 or '7. I can't

22 recall which year.

23 Q. All right. And did you ever personally

24 invest in Tesla?

25 A. No.

4 (Pages 10 - 13)


CONFIDENTIAL

Page 14

1 Q. And then on SolarCity, Technology2 Partners, did they ever do any investment in3 SolarCity?4 A. No.5 Q. That was just DBL; correct?6 A. That was DBL Investors.7 Q. And that was not the DBL Partners that8 you're in?9 A. No.

10 MR. CHESLER: That is -- that's correct, it was11 not DBL?12 THE WITNESS: That's correct. I did not invest13 in SolarCity when I was at Technology Partners. And14 DBL Partners, as distinct from Nancy's early funds15 known as DBL Investors, has never invested in16 SolarCity.17 BY MR. BARON:18 Q. So all of the investment in SolarCity is19 DBL Investors, not DBL Partners; is that correct?20 A. Correct.21 Correct. I don't have any financial stake22 in SolarCity whatsoever, either through my prior23 fund, Technology Partners, through Nancy's prior24 fund, DBL Investors, or ever personally.25 Q. Then perhaps you can explain something to

Page 15

1 me.2 MR. BARON: Can you give me the DBL3 Presentation 1116. We'll come back to this document4 in a moment.5 Can you mark that as Exhibit 1 for me,6 please.7 MR. CHESLER: I'm sorry. Is this going to be8 Ehrenpreis 1?9 MR. BARON: Sure, Ehrenpreis 1.

10 (Ehrenpreis Exhibit 1 was marked.)11 BY MR. BARON:12 Q. I'm showing you a document that is a press13 kit for DBL Partners. It's attached to an e-mail14 from a Patrick Sagisi to you dated November 16th,15 2015.16 Do you recognize this attachment?17 A. Yes.18 Q. So if you take a look on the second page,19 it talks about "DBL Partners, Double Bottom Line20 Venture Capital" firm.21 Do you see that?22 A. I do.23 Q. So why do you cite SolarCity -- why is24 SolarCity one of the companies that you identify as25 a company to which DBL Partners is investing?

Page 16

1 MR. CHESLER: Objection to the form.2 You can answer.3 THE WITNESS: This is a very standard way in4 which venture capitalists describe their prior5 investments. When a venture capitalist goes to a6 new firm, it doesn't mean they don't have7 investments that they've made historically. And so8 the fact that we reference SolarCity is completely9 accurate and consistent with how the industry

10 operates in that it's highlighting prior investments11 that the partners at DBL Partners have made.12 BY MR. BARON:13 Q. So DBL Partners is taking -- I don't mean14 to pejoratize it. I'm just saying that DBL Partners15 is touting successes that the partners may -- the16 partners at DBL Partners may have had through other17 venture capital funds; is that correct?18 A. That's correct.19 Q. So -- and again DBL Partners has never20 invested in Tesla either; correct?21 A. Correct.22 Q. And just so that we're clear, has23 DBL Partners invested in SpaceX?24 A. Yes.25 Q. So how much -- we'll spend a little bit

Page 17

1 more time on this document in a moment. I just

2 wanted to understand that distinction.

3 How much has DBL Partners or you invested

4 in SpaceX?

5 A. DBL Partners -- what is referred to as

6 Fund III, DBL Partners III, has invested .

7 Q. And how much has DBL Partners raised? How

8 much has Fund III raised?

9 A. It's a little over 400 million.

10 Q. And are there any other venture funds

11 under DBL Partners other than Fund III that are

12 still in existence?

13 A. Fund III is a generic term for

19 But we collectively refer to it -- when I

20 referenced that Fund III is 400 million, we invest

21 those And so my reference to

22 it being a fund technically is actually

23 as I described.

24 Q. And there are no other funds under

25 DBL Partners? That is the only fund in which you've

5 (Pages 14 - 17)


CONFIDENTIAL

Page 18

1 raised money for?2 A.

18 MR. CHESLER: Ira, just wait until he finishes19 his questions so you guys are not speaking over each20 other because the court reporter will have trouble21 taking it all down.22 BY MR. BARON:23 Q. You personally, do you make money off of24 both

we only make money if

Page 19

1 the company performs. We don't make any money if2 the company doesn't perform. We don't get any3 management fee for that in any way.4 Q. What percentage do you get on performance?5 Do you know?6 A. I'd have to go back and look at the7 economics on that one.8 Q.

.

Page 20

1 Q. In order to make a profit , does2 there have to be some sort of an exit?3 A. Yes.4 Q. So it has to either -- it has to either5 IPO or it has to be sold fundamentally?6 A. Those are two of the ways one can exit.7 Q. How else can you exit 8 A. One could sell their shares in the9 secondary market.

10 Q. So after it goes public.11 A. Not necessarily.12 Q. Do you have any other investment13 businesses running other than

16 A. No other businesses.17 Q. You say that -- is there some other18 investments that you are -- other than personal19 investments.20 A. Oh, no.21 Q. And you have some stock in Tesla; correct?22 A. Correct.23 Q. Do you have any other companies that you24 have the same amount of stock in other than Tesla?25 A. The same amount of stock?

Page 21

1 Q. Same value in stock, same current market2 prices.3 A. I'd have to go back and look at actually4 what the numbers are, but, approximately, I have5 others, yes.6 Q. What companies?7 A. 8 Q. Anything else that you can think of?9 A. I would have to go back and see what the

10 approximate value of that is, but it's a11 concentrated holding. I have a few others that are12 concentrated.13 Q. Are they about the same value or more or14 less, do you believe?15 A. I'd have to see what the stock price is of16 those at any given point.17 Q. Are they within the same range of your18 ownership interest of Tesla?19 A. I think Tesla is probably more as of20 today.21 Q. Let's go back to what is your Exhibit 1 in22 front of you.23 So when talking -- as you've said before,24 you're really sort of talking about when advertising25 DBL Partners, you're advertising it with sort of,

6 (Pages 18 - 21)


CONFIDENTIAL

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1 collectively, the successes of both you and Nancy,2 both currently and some of your past successes;3 correct?4 A. Correct.5 Q. So when you talk about -- and go to the6 first page, if you would again, the Double Bottom7 Line page. When you talk about the $75 million8 Fund I and seven exits, five IPOs, what -- are those9 yours and Nancy's or are those just yours?

10 A. No, Fund I and Fund II do not include me.11 Q. Okay. So Fund I and II do not include12 you. So you are not in that discussion discussing13 your IPO of -- the IPO of Tesla in any way?14 A. I'm sorry. Can you say that again.15 Q. The IPO of Tesla is not referenced in16 either the seven exits, five IPOs, one IPO, one17 exit.18 A. That's correct. That's all from prior to19 when Nancy and I formed DBL Partners.20 Q. Of the companies that you list, and you21 list 12 down on this page, how many of them went22 public under your or Nancy's investments?23 MR. CHESLER: Objection to the form of the24 question.25 MR. BARON: That may have been bad.

Page 23

1 BY MR. BARON:2 Q. How many of these 12 went public while you3 were -- while you or Nancy were pre public4 investors?5 A. Can you clarify what you're asking.6 Q. Sure.7 How many of these 12 companies were8 invested in and eventually went public?9 A. With Nancy and I -- just to clarify --

10 Q. Either of you, either you or Nancy.11 A. Just to clarify, are you asking with Nancy12 and I as being partners together?13 Q. No. Either together or individually.14 A. Well, I can only -- I can only reference15 the page which references what Nancy's exits were16 prior to -- and more than Nancy, the fund that Nancy17 was part of prior to me -- to Nancy and I joining up18 with other partners.19 But what it references here is that there20 are seven exits, five IPOs in Fund I; and, in21 Fund II, at least as of the time of this22 presentation, one IPO and one exit.23 Q. I understand.24 But Tesla went public; correct?25 A. Correct.

Page 24

1 Q. And that was an investment that you were2 involved in; correct?3 A. That was also an investment that4 DBL Investors made, which is being referenced in5 this presentation.6 Q. Okay. So DBL Investors also invested in7 Tesla's pre IPO?8 A. Correct, and that is what this is9 referencing.

10 Q. How much did DBL Investors invest pre IPO11 in Tesla?12 A. I don't know.13 Q. Was it more or less than you did? Do you14 know?15 A. I don't know. It wasn't a fund I was16 managing.17 Q. What was your return on your Technology18 Partners investment?19 A. It was approximately a , at the20 point -- and the way we -- the way we calculate that21 is how much we invest and then ultimately the22 cumulative value based on distributions.23 Q. So SolarCity is also public, but, again,24 that was Nancy's investment, that wasn't yours;25 correct?

Page 25

1 A. Correct.2 Q. Pandora also went public, but that -- was3 that also a Nancy investment and not yours?4 A. Correct. The presentation in this exhibit5 are all related to the prior funds of DBL Investors.6 Q. So what other public -- what other7 companies have you taken public in investments that8 did not involve Nancy?9 A. Eloan.

10 Q. Huh?11 A. Eloan.12 Q. Eloan.13 And when did you take that public?14 A. It was in approximately 2000.15 Q. What was your initial investment in Eloan?16 A. I don't recall. It was approximately17 maybe cumulative.18 Q. And what was your multiple on the exit?19 A. Approximately .20 Q. Any other companies you've taken public on21 your own?22 A. Can you clarify what you mean "on your23 own."24 Q. That was not -- well, actually, I'll ask25 you generally.

7 (Pages 22 - 25)


CONFIDENTIAL

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1 What companies have you ever taken public?2 A. So we don't take companies public.3 Q. Let me refresh.4 What companies have you been early5 investors in that went public?6 A. There have been many, many companies that7 Technology Partners had invested in that went8 public. I could go back and try and recall a list,9 but over its years, during the point -- years I was

10 a partner, there were Rivance. There was a whole11 set of companies that the firm took public. I was12 referencing, in Eloan, the one I was on the board13 of.14 Q. Okay. What about companies that you have15 taken public with Nancy? Are there any?16 A. There are none. We raised the fund in17 2015 -- actually, in December 2000 -- well, I can't18 remember the month, in 2015.19 Q. Now, again, with regard to these 1220 identified companies on this page 1, other than21 there being a connection through Elon Musk between22 Tesla, SolarCity and SpaceX, is there a connection23 between any of those other companies with similar24 ownership, similar CEOs, anything to that effect?25 MR. CHESLER: Object to the form.

Page 27

1 THE WITNESS: Can you clarify what you're2 asking.3 BY MR. BARON:4 Q. Well, you will agree with me that there's5 a connection between Tesla, SolarCity and SpaceX;6 correct?7 MR. CHESLER: Same objection.8 THE WITNESS: If you're asking -- let me try9 and give you how I'm interpreting it.

10 If you're asking whether any of the --11 whether Elon was involved in any of the other ones12 besides what you've identified, not to my knowledge.13 BY MR. BARON:14 Q. That's not my question. Let's take it one15 step at a time.16 You agree with me that there's a17 connection between Tesla, SolarCity and SpaceX;18 correct?19 MR. CHESLER: Objection as to form.20 THE WITNESS: How are you defining21 "connection"?22 BY MR. BARON:23 Q. Elon Musk considers him the founder of all24 three, Elon Musk is the largest shareholder of all25 three, and Elon Musk at some point ran all three.

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1 A. That's what I was trying --

2 Q. Do you agree with that?

3 A. I agree with those facts.

4 Q. Now the question is, with regard to any of

5 the others and not involving Elon, do you know

6 whether there's some sort of a connection between

7 any of the other, other than those three?

8 A. Well, number one, you're asking me about

9 DBL Investors' prior portfolio for which I was not a

10 partner and for which I was not there when they

11 actually identified the decision to make those

12 investments. I don't have access to those cap

13 tables and the like.

14 That said, as a general matter, one of the

15 other serial entrepreneurs in the portfolio is a guy

16 named Dan Shugar, and he has multiple companies that

17 DBL historically had invested in.

18 Q. Which companies are those?

19 A. PowerLight and then NEXTracker. And there

20 was a third company, a spinout, that is not on here.

21 Q. Okay. And do you have any -- have you

22 ever invested with Dan Shugar or any of Dan Shugar's

23 companies?

24 A. No.

25 Q. And do you have any personal association

Page 29

1 with Dan Shugar?

2 A. I know Dan Shugar professionally.

3 Q. But you have no investment or business

4 dealings with him?

5 A. No.

6 Q. Now, turn to a couple pages later with

7 "Fund III Advisors and Brain Trust."

8 Now, what do you -- sorry.

9 What does an advisor of an investment fund

10 do?

11 A. There is not a single answer to that

12 question. It's just totally dependent on the fund

13 and its advisors.

14 Q. So why do you have advisors?

15 A. In this case, as a -- these are folks who

16 we had invested in and who had been successful. And

17 given our focus on the clean tech and sustainability

18 sector, the two most successful companies in

19 venture-backed history in the clean tech sector and

20 sustainability sector that exists since the

21 beginning of venture investing were Tesla and

22 SolarCity.

23 And the partners raising DBL --

24 DBL Partners were each on the board of the two most

25 successful companies in history.

8 (Pages 26 - 29)


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1 Q. So you don't consider SpaceX to be a

2 clean-energy company; right?

3 A. I was referencing with Elon/Tesla and with

4 Lyndon/SolarCity.

5 Q. But what you were advertising again for

6 DBL Partners is Elon Musk for both SpaceX and Tesla;

7 correct? That's what this picture shows.

8 A. Well, everyone on this page is associated

9 with clean energy. So the full context of the page

10 is Steve Chu, who is the former secretary of energy.

11 And the middle was Governor Granholm, who

12 spearheaded a renewable energy initiative.

13 And on the right is Arun Majumdar, who was

14 the founding director at the Department of Energy's

15 ARPA-E program. Then he became the VP at

16 Google.org, focusing on energy. And then

17 subsequently ended up at Stanford helping to run

18 their energy initiatives.

19 So, collectively, these are folks who

20 have, as I said, been leaders in the renewable

21 energy industry.

22 Q. My question was simple: SpaceX is not a

23 renewable energy company; correct?

24 A. Correct.

25 Q. And in the big story here, you identify

Page 31

1 Elon Musk as both SpaceX and Tesla; correct?

2 A. That is true. That's his affiliation.

3 Q. And on this page, the only people that

4 either you or Nancy have ever invested in is either

5 Elon Musk and Lyndon Rive. There wasn't actual

6 investment in any companies by Mr. Chu, Ms. Granholm

7 and Mr. Majumdar; correct?

8 A. Correct.

9 Q. And, again, you made -- these are the only

10 two business advisors to Fund III, which were Elon

11 Musk. You don't have any other advisors that you

12 didn't mention on this page; correct?

13 A. There are none mentioned on this page, but

14 that's a different conclusion to reach that we have

15 no other advisors.

16 Q. Do you have other advisors that are

17 specifically known as advisors for Fund III?

18 A. We ended up essentially evolving to a

19 point where, even in these particular cases,

20 advisors turn into a lower case "A," in the sense

21 that they are folks that we had invested in

22 historically, but do not have any formal advisory

23 role.

24 Q. So they turn in to be more of a

25 advertisement sort of promotion. You get to promote

Page 32

1 your company because you're involved with Elon,2 Lyndon, Steven, Jennifer and Arun.3 A. I don't know that I would quite word it4 that way. I would say that these are people that5 the firm -- the firm's principals had historically6 had a deep network with, and these are also the7 leaders of the renewable energy industry. And8 that's what we were, in essence, highlighting.9 Q. Why are you putting them in your marketing

10 material if you don't think that that will improve11 your ability to raise more funds?12 A. I didn't think you asked the question of13 would it improve our ability to raise more funds.14 Q. Did you put them in your marketing15 materials in order to raise more funds?16 A. Well, this is actually -- this is actually17 a press kit. So this document -- let's see what the18 date is.19 Q. 2015.20 A. Yeah.21 So November 16, 2015 is post the date we22 raised the funds.23 Q. So why do you do a press kit?24 A. This is likely just a summary of25 DBL Partners. I don't know to whom it went.

Page 33

1 Q. What is the purpose of doing a press kit?2 A. It's not to raise funds.3 Q. It's so that you can improve your4 reputation so you can raise funds in your next fund5 so that people -- so that you raise your profile.6 That's why you do it; right?7 A. I disagree.8 Q. Well, then, what's the purpose? Why would9 you spend the money and the time for a press kit

10 when it serves no function?11 MR. CHESLER: Objection as to form.12 THE WITNESS: First, we didn't spend money on13 this. This was -- Patrick Sagisi is an associate of14 the firm that put together -- how many pages? I can15 count them -- but put together approximately 1916 pages, including a title slide. So in terms of the17 time spent to prepare this was not significant.18 It was -- this also, given that it was19 post raising funds, is not designed for the purpose20 of raising capital. I cannot tell you where this21 was disseminated, but it was not for the purpose of22 raising funds.23 BY MR. BARON:24 Q. What was the purpose?25 A. I don't know based on this e-mail. So

9 (Pages 30 - 33)


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Page 34

1 this e-mail looks like it was sent as an internal

2 e-mail, but I have no idea if and where this was

3 ever disseminated.

4 Q. Okay. So let's go to the next -- let's go

5 to page 7 of this document.

6 And, again, there was some reason that

7 somebody believed that you should do a press --

8 provide some press kit about your track record;

9 correct?

10 MR. CHESLER: Objection as to form.

11 BY MR. BARON:

12 Q. That's what -- this page is a track

13 record -- is a page for track record; right?

14 A. Well, the reason that I don't know if this

15 was ever used is because typically one in a press

16 kit would actually not advertise publicly its track

17 record. And I do know, based on the date, we were

18 done raising capital.

19 So given that this was an internal e-mail,

20 this could very well have been a macro document for

21 which, if ever this was disseminated, there would

22 likely have been a subset of these pages used.

23 But, no, it is not consistent that we

24 would somehow publicly put out a document that would

25 include Slide 7, which is track record.

Page 35

1 Q. And on this track record -- again, on this2 track record, both Tesla and SolarCity are on there,3 but these are the returns that Nancy got, right, not4 returns that you got?5 A. I would describe it as these are the6 returns that DBL Investors got as opposed to7 describing it as these are the returns that Nancy8 got.9 But, correct, these are not my -- I was

10 not affiliated with these funds.11 Q. Now, on the next page --12 MR. CHESLER: We're on 8 now?13 MR. BARON: Yes.14 BY MR. BARON:15 Q. Again, there is a description of16 investments and -- during crisis overdrive -- or17 during a crisis.18 Do you see that?19 A. I do.20 Q. Do you have some understanding as to what21 was intended by this page?22 A. Yes.23 Q. What was intended by this page?24 A. That in being a venture capitalist,25 although folks often arrive after a company's

Page 36

1 success and it's a multibillion-dollar market cap

2 outcome, as a venture capitalist investing in young

3 companies that are young and innovative, there's

4 typically not a straight line to that path to

5 success when those companies work up.

6 And so the point of this slide is there

7 are plenty of examples through the course of history

8 as those bumps arise, a venture capitalist has to

9 make a judgment around whether or not they're going

10 to continue supporting those companies. And when

11 those companies actually achieve those bumps in the

12 road, there are opportunities, at times, to deliver

13 outsized returns if and when it works out.

14 Q. So the investment in Tesla, the 2008

15 bridge, who made that investment?

16 A. DBL Investors made it as part of their

17 investment, and Technology Partners made that

18 investment as part of its investment.

19 Q. So of the $4.5 million bridge, how much

20 was Technology Partners versus DBL Investors?

21 A. I don't recall. This was 2008, more than

22 a decade ago. And I don't recall what the pro rata

23 breakdown was. I can tell you it was probably in

24 the neighborhood, given what percentage we owned of

25 a small percent -- a small double-digit percentage,

Page 37

1 but I would be approximating.2 Q. So you made -- you made -- so there was a3 $4 1/2 million loan.4 And explain to me what the "Converted at5 zero dollars to 248 means."6 A. I'm not exactly sure what the "Converted7 at $0.xx" means. And, again, this reflects -- it8 looks like it was an internal document, which is9 consistent with the title page of Patrick sending it

10 to me internally as opposed to anyone externally.11 So it looks like it's a working document12 where it doesn't suggest what, in fact, the details13 were on the conversion. It looks like it was some14 price lower than a dollar, if, in fact, that15 fact-checking turned out to be correct. It looks16 like Patrick presumed that it was going to be a17 conversion lower than a dollar.18 And then assuming one held one's shares19 through 9/30/2015, it looks like what it's saying is20 if one had done that investment in 2008 and if one21 had held on to the shares through September 30,22 2015, one would have had a rise in stock price of23 less than a dollar to $248.40.24 Q. So what you're saying is -- with this25 slide is, even when things go bad, we believe in

10 (Pages 34 - 37)


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Page 38

1 these companies and we invest -- we were willing to

2 make additional investments; right?


4 THE WITNESS: I would say that it's just too

5 broad a conclusion to reach from this slide. What

6 it's intended to say is that there's judgment

7 involved and that what is often perceived from the

8 outside as challenging times, and, therefore, it

9 becomes harder to support your companies during

10 those challenging times, ultimately requires a

11 judgment.

12 Does one throw -- does one put it in the

13 bucket of concluding that you're throwing good money

14 after bad and actually have to pull support? Or

15 does one double down with one's conviction and

16 actually lend support?

17 And the point of this is those are tough

18 decisions to make. Those are often judged only in

19 retrospect. But when one does that, there can be

20 real financial upside and opportunity in those

21 situations.

22 BY MR. BARON:

23 Q. So this is -- so this slide shows that you

24 doubled down on Tesla; correct?

25 A. Well, it shows three things. It shows

Page 39

1 three examples of where --2 Q. Take them one at a time. I'm going to go3 to the other ones.4 A. Okay.5 Q. But just so I use your phrase, this shows6 that you doubled down on Tesla in 2008; correct?7 A. It shows in 2008 it was actually a very8 challenging time. And that particular bridge round9 was one that required conviction to continue

10 supporting it and that the decision to have done so11 led to outsized returns. If one held it through12 IPO, it would have had a great venture multiple of13 maybe 20X. And if one held it to the stock price in14 2015, one might have had a 200X or a -- even15 larger -- maybe a 300X or so return.16 Q. And you don't specifically remember what17 return you got on that investment; correct?18 A. Well, we don't -- venture capitalists19 don't actually distribute their shares by the20 initial investments they make. So when we21 distribute it -- it was a cumulative distribution at22 Technology Partners. I assume that's what you're23 asking about, Technology Partners.24 But at Technology Partners, we had a25 cumulative investment that we made over a period of

Page 40

1 time. This 2008 bridge was one of them. And then2 ultimately we distribute it along the path as well.3 And so in terms of calculating the4 specific return of that investment, it was really a5 blended one, but the overall investment -- the6 overall cumulative capital relative to the7 distribution at Technology Partners was about a 10X.8 Q. On Pandora, was that you or was that just9 Nancy?

10 A. Again, I wasn't involved in any of the11 DBL Investors companies. The only overlap we had12 was Tesla. And so in Pandora's case, that was a13 DBL Investors -- again broader than Nancy, but a14 DBL Investors investment.15 Q. And SolarCity, that was also a16 DBL Investors investment?17 A. It was a DBL Investors investment for18 which I had no financial involvement or even19 involved in terms of activity or decision making. I20 was not in that fund or involved in that fund.21 Q. Are there any -- are there other funds --22 I mean, when you got this, would you say, well, we23 made -- we doubled down on other companies that we24 did well against as well, other than these three?25 A. I would have to go back to see. I think

Page 41

1 there -- yeah, we could probably point to other

2 examples of where there were tough times and we

3 doubled down. I would --

4 Q. But you didn't respond to Patrick and say,

5 hey, look, we shouldn't just focus on these three;

6 we should talk about more when we get that?


8 THE WITNESS: Well, number one, as I said, this

9 looks like -- I have no idea from this what this was

10 even going to be used for, number one.

11 And, number two, I probably wouldn't put

12 somehow some comprehensive analysis of all the times

13 throughout an investment history one doubled down

14 during tough moments and got a return. So we

15 probably wouldn't have tried to find the

16 comprehensive list for a PowerPoint presentation on

17 a slide.

18 What I can tell you is that parts of the

19 reasons that these companies were highlighted were

20 because they were leaders in their industries and

21 success in terms of its financial outcome.

22 BY MR. BARON:

23 Q. Go to page 9, if you would, the pictures.

24 A. Sure.

25 Q. What was the -- do you have some

11 (Pages 38 - 41)


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Page 42

1 understanding of the point of, again, pictures

2 which -- you've talked -- once again, the three

3 companies in these pictures are Tesla, Pandora and

4 SolarCity.

5 Do you know what the point of these

6 pictures are?

7 A. Sure.

8 This is quite typical in a venture capital

9 summary where one would highlight where there have

10 been successes. And in these cases, the title of

11 this is "41 billion in Market Cap." And what that

12 references is that the cumulative market cap of

13 these three investments that were made largely at

14 the earliest of stage, when it was more of an idea

15 than a reality, as a general matter -- we can go

16 into each of them, but now, fast-forwarding, that

17 each of these three early-stage investments that

18 were made now had achieved a material market cap of

19 over $40 billion.

20 Q. Now, again, are there other companies that

21 didn't involve Elon Musk that you thought -- that

22 were significant for whatever purpose, this press

23 release, that you raised with Patrick or anyone

24 else?


Page 43

1 BY MR. BARON:2 Q. This one has Elon Musk center top3 highlighting Tesla.4 I think that's you on the left; correct?5 A. Correct.6 Q. Is there a reason, again, that you didn't7 highlight -- or this did not highlight some other8 unrelated Elon companies other than Pandora?9 A. We only put three on the slide.

10 Q. I agree.11 A. And so we put Pandora as another one that12 had achieved outsized returns. And so, again, this13 is an example of where, as an early-stage venture14 capitalist investing single-digit millions of15 dollars in companies that were simply ideas at the16 time achieved multibillion dollar outcomes.17 And that was the point of it, and that's18 consistent with -- if you probably saw almost any19 other venture capital funds presentations, it would20 highlight where they have invested early and where21 they have achieved over 40 billion of market cap.22 Q. Their most significant -- what was the23 phrase you used -- outsized investments?24 A. Yeah, I would say when you actually25 achieve outsized returns, those get highlighted.

Page 44

1 Q. So, collectively, between you and Nancy,2 the most significant outsized investments that you3 guys have done in your careers are Tesla, SolarCity4 and Pandora; correct?5 A. I can't speak to whether or not -- first6 of all, I wouldn't speak to -- call it Nancy. I7 would call it DBL Investors. There are other8 partners at firms, and one doesn't make a sole9 decision at a firm. There's a set of partners.

10 So I don't know that it would be fair to11 the DBL Investors partnership to simplify it by12 calling it Nancy.13 Second, I can't speak to Nancy's history,14 but that is true that the 32 1/2 billion market cap15 at the time of this presentation was the most16 significant one that I have been involved with.17 Q. You've been in ones more significant since18 then?19 A. No.20 Q. And the reason I say Nancy is, again, I'm21 trying to understand the methodology of this22 presentation. Because I look on page 4, and it23 identifies DBL Partners as you and Nancy as the24 partners. And, therefore, giving credit within this25 document is giving credit, you said, not to

Page 45

1 DBL Partners, but to the managing partners of

2 DBL Partners.

3 A. Well, I'm looking at page 4. And, in

4 fact, there are the five investing partners of

5 DBL Partners that are not only listed, but have

6 their pictures and have their backgrounds. And, in

7 fact, that's consistent with there being not just

8 Nancy and I, but, in fact, five investing partners

9 at DBL Partners.

10 So that's why I keep trying to clarify,

11 it's not Nancy and me; it's beyond that. And if

12 there were a presentation that highlighted

13 DBL Investors, it would also not be a slide which

14 just had Nancy's picture; it would have other

15 partners as well.

16 Q. Now, MapBox also involves Elon Musk in

17 some way; is that correct?

18 A. No.

19 Q. No.

20 Does he have any investment in MapBox?

21 A. No.

22 Q. Now, go to page 17.

23 A. Okay.

24 Q. Again, a number of -- a picture of World

25 Energy Forum, and again the choice was to have Elon,

12 (Pages 42 - 45)


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1 upper left, with his picture in it.2 On this group of folks that were being3 touted, other than Elon and Lyndon, are there any4 other folks associated with significant investments5 from either you or Nancy or any of the funds that6 you were related to?7 A. No.8 Q. Now, you also have a website at9 DBL Partners; correct?

10 A. We do.11 Q. And you're not raising funds for -- are12 you currently raising funds for DBL?13 A. No. You mean DBL Partners?14 Q. DBL Partners.15 A. No.16 Q. Are you raising funds for any fund right17 now?18 A. No.19 Q. What's the purpose of a website?20 A. Broad question. Typically people put -- I21 don't know a venture firm that doesn't have a22 website.23 Q. Well, why do you have one -- if you're not24 raising money and you're not promoting yourself for25 your next round of raising money for some another

Page 47

1 partnership, what's the purpose?2 A. So if one didn't have a website as a3 venture capitalist, then of the more than 1500 firms4 that would call themselves venture capital firms,5 you might be the only one without a website. And6 most of those firms are not raising money at a given7 time.8 The purpose of a website -- number one.9 Number two, when you raise capital, I have

10 never met an investor in our fund that has done so11 because of our website.12 Three, the purpose of a venture capital13 firm is not to raise money; it is actually, in large14 part, to deploy capital and to invest in companies.15 So the hypothesis that somehow we're -- or16 the notion that somehow put a website out to raise17 money would fly in the face of typical practice,18 which is, it's all about visibility around19 investments and building a network and ecosystem so20 people know you. If you didn't have one, you might21 be considered a -- not only not a real player, but I22 would question whether any entrepreneur would raise23 capital from a venture capitalist that didn't have a24 website.25 Q. Just so I understand, the information that

Page 48

1 you're putting forth on your website, are you2 putting forth information that is DBL Partners --3 what DBL Partners is doing or what any fund4 associated with you or Nancy has done in the past?5 What is the goal on the website?6 A. Well, number one, I wouldn't say there's a7 goal of a website. There's probably a multitude of8 reasons why you have a website and who visits a9 website, number one.

10 Number two, yeah, it is true that when a11 venture capital firm evolves from prior firms, then12 what one typically would see on that website is a13 cumulative history of what each of those partners14 had done historically or at least highlighting those15 highlights as being the principals investing the new16 capital in the new fund.17 If one didn't do that, then the website18 would largely be pretty blank. And that's19 consistent with both industry practice as well as20 DBL Partners.21 Q. Let me show you a document which I believe22 is a printout of your website.23 MR. BARON: This is a numbered one, two, three,24 four, five, six-page double-sided document. It25 says, "DBL Partners."

Page 49

1 Can you mark that as Exhibit 2, please.2 (Ehrenpreis Exhibit 2 was marked.)3 BY MR. BARON:4 Q. Do you recognize -- does this appear to be5 a printout of DBL Partners' website?6 (Witness reviews document.)7 A. Yes.8 Q. And were you involved or did you have a9 say in what went on the website?

10 A. I'm sure at a theoretical level, I would11 have a say, but if you're asking whether I spend my12 time wordsmithing this website, the answer is no.13 Q. Only you -- when you're talking about all14 the other partners, only you and Nancy Pfund are15 identified as the managing partners with pictures on16 the website; correct?17 A. Well, just to parse your question, all of18 the partners are identified on the website with our19 respective titles. And all five of the investing20 partners are identified on the website with their21 pictures and bios, with their titles.22 And it is true that, in the fund, not just23 on the website, that Nancy and I are the two24 managing partners.25 Q. And then on the portfolio page after

13 (Pages 46 - 49)


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1 Nancy's picture, you identify both -- you make a2 choice of 1, 2, 3, 4, 5, 6, 7, 8 -- 16 companies.3 Are those all of the companies in the4 clean technology portfolio of the company?5 A. When you say "of the company" --6 Q. Or of DBL Partners.7 A. Again, these are not the 16 companies that8 are the investments in DBL Partners. These are9 examples of companies that the partners who invest

10 DBL Partners have invested in historically. When11 you raise a fund, as we did in 2015 -- when -- you12 actually don't have any investments.13 So if you didn't put your prior14 investments, then it would not only omit the15 experience that the partners have had in prior16 companies, it wouldn't include anything.17 Q. So in your view, a portfolio of18 DBL Partners includes companies that are not19 invested in by the partners themselves --20 MR. CHESLER: Objection as to form.21 BY MR. BARON:22 Q. -- by the company itself.23 I'm just trying to understand your phrase.24 You call this a portfolio.25 A. Yes.

Page 51

1 Q. If I was to talk about a portfolio of2 cases, I'm talking about what I actually have.3 A. I can't speak to your industry. What I4 can speak to is that a typical -- that typically you5 would have a portfolio listed on a venture capital6 firm site of investments that were prior to the7 existing fund that was being managed by the8 principals involved. And that is precisely what9 this is.

10 Q. So of these clean technology, which are11 not actually in the DBL Partners portfolio?12 A. SolarCity, Tesla, NEXTracker, Siva, View,13 Primus, Ogin, PowerGenix, BrightSource, Akros,14 Kaiam, OPX Bio, PowerLight and eMeter.15 Q. So are any actually in DBL Partners'16 portfolio? Did I miss one?17 A. You missed two.18 Q. Which ones?19 A. Zola and Advanced Microgrid Solutions.20 Again, just to make this super clear, at21 the beginning of the fund, those two wouldn't have22 even been on here, which is, again, standard23 practice.24 Q. Okay. On health care, are any of the five25 portfolio companies actually in DBL Partners'

Page 52

1 portfolio?2 A. Yes.3 Q. Which ones?4 A. BrainScope.5 Q. Only one. All right.6 How about information technology? Are any7 of those funds under information technology actually8 in DBL Partners' portfolio?9 A. Just to clarify, you're asking which

10 companies are in the DBL Partners portfolio?11 Q. The ones that are identified under12 information technology.13 A. Sure.14 Andela, Farmers Business Network, Planet,15 Mapbox, The Muse.16 Q. Okay. Any others?17 A. Not in that section.18 Q. What about sustainable products and19 services; how many are actually in DBL Partners'20 portfolio?21 And just so that -- do we consider SpaceX22 a sustainable product and services company?23 A. There are elements of it that we would24 consider. Yes, we would consider -- there's aspects25 to that thesis that are around the sustainable

Page 53

1 aspect of planet earth.

2 Q. So which of these companies are actually

3 in the DBL Partners' portfolio?

4 A. Apeel Sciences, Ruby Ribbon, The RealReal,

5 SpaceX.

6 Q. In clean technology, you have two -- two

7 companies identified, SolarCity and Tesla.

8 And as you said before, neither of those

9 two are actually in DBL Partners' portfolio; is that

10 correct?

11 A. Correct.

12 Q. Is there somewhere on the website where

13 you actually note that they are not actually in the

14 DBL Partners portfolio?

15 MR. CHESLER: Counsel, I direct your attention

16 to the --

17 MR. BARON: Counsel, you know what, he can do

18 it or not. And if you want to ask him on redirect,

19 you can. In the Delaware court, you don't need to

20 direct me to anything. Just go with that.

21 MR. CHESLER: Counsel, I'm well aware of the

22 procedures in Delaware court.

23 MR. BARON: Good. Then let's follow them. You

24 can object to form or you can object to privilege

25 and that's it.

14 (Pages 50 - 53)


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1 THE WITNESS: So what we do is -- on the2 portfolio, what we say, on page -- there's not a3 page number on this, but I direct you to the page4 that is described as "Portfolio." And what we say5 expressly on that page is "Companies from existing6 and prior funds managed by the partners include,"7 and then we list all the companies that we've been8 discussing.9 BY MR. BARON:

10 Q. Is there anywhere you identify which11 companies are actually in DBL Partners' portfolio?12 MR. CHESLER: Objection as to form.13 THE WITNESS: Are you asking whether we are14 doing that on our public website?15 BY MR. BARON:16 Q. Yes.17 A. No.18 Q. So, again, under clean technology, I think19 my last question was neither SolarCity, nor Tesla is20 actually in DBL Partners' portfolio; correct?21 A. You've asked me multiple times.22 Just to be clear, DBL Partners has no23 investment in SolarCity. DBL Partners has no24 investment in Tesla. And I have no personal25 financial relationship in any way or management

Page 55

1 relationship in any way to the prior funds that

2 Nancy was managing and her team was managing at

3 DBL Investors.

4 Moreover --

5 THE VIDEOGRAPHER: You've lost your mic.

6 THE WITNESS: Sorry.

7 And Nancy had no involvement or financial

8 stake in any way to Technology Partners.

9 BY MR. BARON:

10 Q. And then going -- just so we lock this up,

11 SpaceX is a current DBL Partners portfolio company;

12 correct?

13 A. Yes.

14 Q. And that is -- just so that we close the

15 loop on that, that is through both partners

; correct?

17 A. Correct. And DBL Investors had a prior

18 investment in it as well, that piece of which I have

19 no interest or stake in.

20 Q. How much was DBL Investors prior?

21 A. I don't know. I don't recall, actually.

22 I don't recall.

23 Q. What about any other subsequent

24 investments other than the initial -- like we had

25 talked about having made some and other

Page 56

1 things in Tesla.2 Have there been any loans or any other3 investments in SpaceX?4 A. No. And the only other clarification I5 would give is that we often say that the lines of6 demarcation on how we classify our companies often7 have overlap, often could be multiple categories,8 and could often evolve over time. So the9 demarcation, as one example, between clean

10 technology and our sustainability practice has a lot11 of overlap as well.12 Q. Now, when the Tesla -- when13 Tesla/SolarCity started discussing or went into14 potential discussions of the acquisition of15 SolarCity by Tesla, were you getting some pushback16 from the fund to get off of the Tesla board of17 directors?18 MR. CHESLER: Objection as to form.19 THE WITNESS: I wasn't getting any pushback by20 the fund. One of the things that we were21 considering was whether or not the investors of22 DBL Investors would be pleased with the outcome of23 the acquisition. At least that's what the partners24 of DBL Investors were worried about.25 BY MR. BARON:

Page 57

1 Q. Well, but there was concern that Nancy was2 going to bring up the idea of you stepping off or3 you getting off of the board of Tesla; correct?4 A. I wouldn't describe it that way.5 Q. Who is Cynthia Ringo?6 A. Cynthia's a partner in DBL Investors and7 DBL Partners.8 Q. Now, it was Ms. Ringo's view that your9 position on the Tesla board contributed

10 significantly to the DBL brand; correct?11 A. Correct.12 Q. And you agreed with that?13 A. Yeah.14 Q. So the issue that you were discussing --15 or that you were concerned about was whether or not16 the SolarCity investors, through the DBL Investors17 fund, would think it was appropriate for you to be18 on the board and sort of weighing the value of those19 two things; correct?20 A. No.21 MR. CHESLER: Objection as to form.22 BY MR. BARON:23 Q. What was the issue -- explain to me why it24 was that -- in anticipation of a call in August,25 that Cynthia Ringo was discussing with you how she

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1 was going to respond if Nancy brings up your Tesla2 board seat.3 A. It would help me to see what document4 you're referring to.5 Q. I know you can read it. So I just want to6 understand whether or not you recall that7 conversation with her at all.8 A. When you say "that conversation" --9 Q. A conversation with Ms. Ringo discussing

10 what to do if Nancy Pfund brings up your Tesla board11 seat in connection with the SolarCity acquisition.12 A. Yes.13 Q. What was -- why did Nancy [sic] Ringo14 believe that you should -- or she should be prepared15 to respond to that issue?16 A. So just to clarify your question, you17 referred to "Nancy Ringo."18 Q. I'm sorry. Cynthia Ringo.19 A. So I think this is a good example of where20 Cynthia, I think, acknowledged that I was doing my21 job as a Tesla board member, which is to ultimately22 get a great price for Tesla.23 And in so doing, that meant that the24 SolarCity investors were going to get less for every25 dollar that the Tesla side was going to negotiate.

Page 59

1 And so my recollection is that Cynthia understood2 that that was my role at Tesla and that that was my3 job and that's what I did.4 And, in fact, to the extent that there5 were DBL Investors LPs that were ultimately upset6 about the price that they were going to get for7 their SolarCity investment, my recollection is that8 Cynthia was understanding of the fact that that was9 my job and I don't have any economic interest in

10 SolarCity and that we succeeded in getting the best11 price for Tesla.12 Q. Well -- she said in the e-mail, "If Nancy13 brings up your Tesla board seat."14 What was the concern that Nancy was going15 to bring up?16 A. I would have to see what e-mail you're17 referencing in order to have that level of detail.18 I don't know what e-mail you're --19 Q. So you don't recall there being any20 conflict or any potential conflict between you and21 Nancy Pfund regarding your board seat at Tesla?22 A. There was not a conflict. There was a23 discussion around what if the LPs of Fund II, for24 whom I was not a managing partner, ended up being25 upset at the DBL Investors team and referenced that

Page 60

1 their future partner in a future fund was actually a2 counterparty to that.3 And Cynthia expressed her view to me,4 which is, if that's the case, that's just the way it5 works and you were doing your job.6 Q. Now, a couple of things -- sure. Let's7 show you this.8 MR. BARON: Can I have the August 1st e-mail,9 please.

10 (Ehrenpreis Exhibit 3 was marked.)11 BY MR. BARON:12 Q. So I'm showing you an e-mail dated13 August 1st, 2016. It is a chain e-mail. The first14 e-mail is earlier in the day from Cynthia Ringo to15 you, "Thoughts for tomorrow's call."16 Do you see that?17 A. I do.18 Q. Do you remember what the call that is19 tomorrow's call was supposed to be about?20 A. It was about if the DBL Investors LPs21 ended up being upset about the ultimate price that22 SolarCity got, whether or not -- how, as a23 collective group in DBL Partners, we were going24 to -- how we were going to respond and react to25 that.

Page 61

1 Q. Right.2 And it appears that what Cynthia Ringo3 suggested and you approved was that if Nancy brings4 up your Tesla board seat, that she will express5 surprise since you thought the call topic was6 communication with LPs about the SolarCity7 transaction and how to best handle that with8 transparency.9 A. Yeah. Well, it was --

10 Q. That's just the question.11 That is what you -- I just want to make12 sure that we understand that, and I'll ask you a13 follow-up question.14 This question simply is that, in this15 context, you understood Cynthia Ringo to say that if16 Nancy brings up your board seat, what she will do17 will be express her surprise because that is not18 what the call is supposed to be about.19 That's what you understood this e-mail20 chain to be about.21 A. No. No.22 MR. CHESLER: Objection to form and to23 interrupting the witness' answer.24 BY MR. BARON:25 Q. So what did you understand Cynthia to mean

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1 when she said, "If Nancy brings up your Tesla board2 seat, I will express my surprise since I thought the3 topic of the call was communications with LPs about4 the SolarCity transaction and how to best handle5 that with transparency"?6 A. Yes, is that to the -- that was the7 purpose of call, was to figure out if the8 DBL Investors LPs were ultimately upset that I was a9 counterparty to that transaction that ultimately led

10 to them getting a lower return on their investment.11 And as part of that -- what Cynthia was12 saying here is that, as part of that, if the topic13 of either Nancy or the LPs themselves talked about14 my Tesla board seat, that that would be something15 that Cynthia would be surprised about.16 And ultimately it sounds like --17 recognizes that I was just doing my job and so for18 someone to be upset at that would actually be19 surprising.20 Q. Okay. And when she said in her e-mail21 that Nancy knew "it was prominent in the marketing22 of the fund," meaning the Tesla board seat, "and was23 a real benefit in fund-raising," is that accurate?24 A. Absolutely, we were totally transparent.25 And the fact that I was on Tesla's board was known

Page 63

1 to everyone we'd raise the fund.

2 Q. And it was prominent in the marketing of

3 Fund III; correct?

4 A. Yes.

5 Q. And it was a benefit in the fund-raising?

6 A. It was.

7 Q. And again -- and ultimately did you have

8 that conversation? Did Nancy Pfund raise that issue

9 on that call?

10 A. No.

11 MR. BARON: Why don't we take a quick break and

12 then we'll move on to the next subject.

13 THE VIDEOGRAPHER: We're going off the record.

14 The time is 10:45 a.m. and this is the end of Media

15 Unit No. 1.

16 (Recess taken.)

17 THE VIDEOGRAPHER: We're back on the record at

18 10:56 a.m. and this is the beginning of Media

19 Unit 2.

20 BY MR. BARON:

21 Q. I'm going to now move on to some

22 information about SolarCity that you well may not

23 have known about, and these are not documents that

24 you're on, that I want to talk to you about.

25 Let me first just show you a document

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1 dated September 30th, 2015, please.2 MR. BARON: Mark this as Exhibit 4, please.3 (Ehrenpreis Exhibit 4 was marked.)4 BY MR. BARON:5 Q. This is an e-mail chain. And like all6 other e-mail chains, they start from the most recent7 to prior. This e-mail chain starts with an e-mail8 from Tanguy Serra at SolarCity to a number of other9 SolarCity employees, including Brad Buss.

10 Do you know who sent Tanguy Serra this?11 A. By name.12 Q. Do you know what his role was at13 SolarCity?14 A. I can't recall.15 Q. Have you ever seen this e-mail before,16 either in preparation or concurrently with -- being17 sometime concurrently with the acquisition?18 A. No.19 Q. Do you see here, on the Tanguy Serra, he20 talks about the fact that, as far as their total21 cash war chest at SolarCity, that they anticipated22 in being down $900 million?23 Do you see that?24 A. I see the words.25 Q. Did anybody ever tell you, again, when the

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1 idea of buying SolarCity was being brought up, that,2 at the end of 2015, they were anticipating being3 down in cash by some $900 million?4 A. Can you clarify your question. When are5 you asking?6 Q. My question is whether or not the idea --7 at the time that you were considering buying8 SolarCity, did anybody tell you about this9 particular issue that was happening within

10 SolarCity?11 MR. CHESLER: Objection as to form.12 THE WITNESS: Well, I've never seen this13 e-mail. I'm not exactly sure what it's referring14 to. It looks like it was September 2015. And the15 analysis around the financials, which -- in which I16 was involved didn't happen until mid-ish -- I can't17 remember the month -- 2016.18 BY MR. BARON:19 Q. I understand.20 And at the time that you were looking at21 this stuff in June 2016, did anybody tell you that22 the quarter before or a couple of quarters before23 that the -- that internally at SolarCity, Mr. Serra24 was concerned about the cash being substantially25 depleted?

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1 A. They definitely didn't tell me about2 Tanguy Serra's view of anything.3 Q. Well, did anybody -- I mean, you4 understand that Elon Musk may have been aware of5 this, Nancy Pfund may have been aware of this,6 Mr. Buss may have been aware of this.7 Did any of these people indicate to you8 last year was difficult, and we were way down on9 cash?

10 MR. CHESLER: Objection as to form.11 THE WITNESS: Well, yes, we were -- when we12 ultimately hired Evercore, we -- through the course13 of the diligence process, the financials were not a14 mystery. That was part of the diligence process.15 BY MR. BARON:16 Q. So you were aware -- you were aware that17 in the -- as of September 30th, 2015 -- by the time18 of the merger, you were aware that in19 September 2015, they were down in that year20 900 million from a start of a $1.1 billion war21 chest.22 A. I can't recall today what the specific23 numbers were -- at the time we ultimately approved24 the deal, what the specific variance was from an25 earlier point of time to an end-of-year period of

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1 time, a period of time which I was not an investor2 or evaluating the deal.3 What I can tell you, as a broader4 question, is, yes, I was aware of the financials of5 SolarCity at the time of the acquisition.6 Q. Okay. Now, do you see the next e-mail7 above from Hayes Barnard?8 Do you know who that is?9 A. I know who he is.

10 Q. Do you know what role he had at SolarCity?11 A. I know he was involved in sales, but I12 don't know what his title is.13 Q. Do you see where he discusses that Tanguy14 Serra was saying that "He is convinced we have a15 major liquidity crisis"?16 Do you see that line?17 A. Sorry. Can you point me to where --18 Q. Under -- the first paragraph under the19 e-mail to Lyndon.20 And you know who Lyndon Rive is?21 A. I do.22 Q. He is the CEO of SolarCity and cousin of23 Elon Musk; correct?24 A. Yes.25 Q. And do you see right here it says that --

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1 on the first paragraph, bottom, "He is convinced we2 have a major liquidity crisis and they need to3 convert right away"?4 Do you see that?5 A. I see that he wrote that.6 Q. By the time that you were involved, do you7 know whether or not SolarCity had a major liquidity8 crisis going on?9 A. I was aware of the SolarCity financials,

10 but I would not have described it as a major11 liquidity crisis.12 Q. What do you consider a major liquidity13 crisis?14 A. A company at the point of insolvency.15 Q. Well, so how does one determine whether a16 company is at the point of insolvency?17 A. If they neither have the cash, nor have18 any ability to raise further cash through any means.19 Q. And do you know whether or not SolarCity,20 at the time of the acquisition, had the cash to pay21 their debts? I'm using your "neither have the cash,22 nor have the ability to raise" the cash.23 So did SolarCity have the cash to pay24 their own debts?25 A. I would have to go back and look at the

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1 financials and see at what point maturities were2 coming due. But typically companies that actually3 have maturing portfolios ultimately refinance that4 debt based on the assets that they have also on5 their books.6 Q. Did they have the cash? Do you know?7 A. I would have to go back and look at the8 financials per se and figure out what cash they had9 relative to the maturities coming due.

10 Q. Did you do that analysis at some point in11 time, you personally?12 A. Evercore did the analysis for it.13 Q. Did Evercore tell you that they had the14 cash to pay their own debt?15 A. I recall in one of their more detailed16 presentations, that they had a set of maturities17 coming due on the debt.18 Q. And did they have the cash to pay for19 that, through operations or some other mechanism,20 without going out and raising more money?21 A. What date are you asking?22 Q. Let's talk about July 2016.23 A. I would have to go back and look at the24 dates. I recall that SolarCity raised bonds around25 that period of time, but I don't recall the date.

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1 Q. Again, without raising -- the first2 question was simple.3 Without raising more funds through some4 form of investment vehicle, did they have the cash5 to pay their debt? Because that's the first element6 of your determination of liquidity crisis.7 A. As I said, I can't recall specifically8 what the dates were, but I do recall that they9 raised -- they did a bond offering. And so I don't

10 know if that's because -- I can't recall right now11 whether that's because they needed that for -- what12 they needed that for over the short term without13 looking at the summary that Evercore prepared.14 Q. Do you know whether or not they were able15 to meet their debt obligations without their bond16 offering?17 A. My recollection is they weren't.18 Q. So at least on your test of liquidity19 crisis, not having the cash to cover their own20 financials -- that part of it, your understanding21 was probably accurate, they didn't have the cash --22 some other fund-raising?23 A. Right. My test is whether --24 (Reporter seeks clarification.)25 A. My view of a liquidity crisis is when

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1 someone neither has the cash, nor has the ability to

2 raise further cash.

3 Q. Exactly. So the first element -- you

4 acknowledge we're in agreement they probably didn't

5 have the cash themselves to pay their own debts;

6 correct?

7 A. Correct.

8 Q. So now the next question is, were they

9 able to raise money? And your response to that is

10 they did, because they took some bonds.

11 A. Yes.

12 Q. Do you know who bought those bonds?

13 A. No.

14 Q. Did anybody ever tell you that they were

15 purchased by Elon Musk and Lyndon Rive at SpaceX?

16 A. Yes, but I don't know the cumulative set

17 of investors in all the bonds.

18 Q. As far as you know, did anybody other than

19 people associated with Elon Musk buy those bonds?

20 A. I would have to go back to refresh. I

21 know Elon did buy some. I know Lyndon bought some.

22 I can't recall if there were others.

23 Q. And SpaceX?

24 A. I can't recall.

25 Q. And do you know, since the acquisition

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1 took place, whether or not, now that Tesla owns it,2 they paid back those bond purchases?3 A. I would have to go back and look.4 Q. That's a possibility, though; correct?5 A. I can't recall.6 Q. You can't tell me -- you can't tell me,7 no, that didn't happen.8 A. I can't.9 Q. Do you know whether, but for being able to

10 sell those bonds to Elon Musk or related entities or11 people, they had any ability to raise cash any other12 way?13 A. No.14 Q. Now, just so that we have the timing15 correct, do you recall that in early February or --16 late -- February 29th is the first time that Elon17 Musk approached the board with the possibility of18 buying SolarCity?19 Does that refresh your recollection about20 timing-wise?21 A. No.22 MR. CHESLER: 2016, Counsel?23 MR. BARON: 2016.24 THE WITNESS: No.25 BY MR. BARON:

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1 Q. Do you know when Elon Musk first2 approached the board about buying SolarCity?3 A. Well, the discussion about SolarCity was4 actually a discussion that was a far broader topic5 about the larger view that we'd had around6 integrating solar into Tesla as a company.7 And so that was a conversation that we've8 had almost since the day I invested. In fact, when9 I invested, it was already published that the first,

10 quote, master plan, of which solar was already11 listed in 2006 as a component of ultimately the12 vision. And as someone who actually invests in13 sustainable energy, that was clearly part of what I14 believed ought to be part of --15 Q. When is the first time that Elon Musk16 proposed to the board of directors that they should17 consider buying SolarCity?18 A. Part of the discussions of whether or not19 we ought to consider a solar investment -- solar20 acquisition or what we ought to do with our solar21 strategy, there were a number of companies,22 including SolarCity, that had long been part of the23 obvious targets.24 Q. When is the first time Elon Musk25 specifically said, I think we should buy SolarCity?

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1 A. Your question -- I don't recall him saying

2 it, A, in that fashion that you're describing; or,

3 B, a specific date that somehow was a first date on

4 SolarCity per se as opposed to it just being a part

5 of a broader conversation around solar.

6 Q. When was the first time you received any

7 presentation from any management or bankers

8 regarding the purchase of SolarCity?

9 A. February 2016.

10 Q. Okay. So all I'm trying to do is get a

11 point now.

12 So at that point in time, did you have

13 some understanding about what was happening from a

14 financial point of view at SolarCity?

15 A. In February 2016, my recollection of that

16 board meeting was an initial conversation about the

17 idea of buying a solar company and, in particular,

18 where SolarCity fit into that, as opposed to it

19 being a decision-point meeting.

20 MR. BARON: Can you give me February 22 from

21 Hayes Barnard, please.

22 Mark this as Exhibit 5.

23 (Ehrenpreis Exhibit 5 was marked.)

24 BY MR. BARON:

25 Q. Showing you an e-mail from Hayes Barnard

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1 again to Tanguy Serra. It's dated, again,2 February 22nd, 2016, so approximately the same time3 that you first received some presentation by4 management about an acquisition of SolarCity.5 During the time you were presented with a6 possibility of an acquisition of SolarCity, did7 anybody inform you of -- let's look at the first8 paragraph from Mr. Serra. "I believe we have a9 demand issue from the NEM wars."

10 Did anybody inform you of that11 information?12 MR. CHESLER: Objection as to form.13 THE WITNESS: Can you repeat your question.14 BY MR. BARON:15 Q. Sure.16 Do you see where Tanguy Serra says, "I17 believe we have a demand issue"?18 A. Well, let me just -- if I could -- this is19 the first time I'm seeing this e-mail, so if I could20 just read what this even is.21 Q. Sure.22 MR. CHESLER: Counsel, I don't think it's23 Tanguy. You said Tanguy?24 MR. BARON: Tanguy Serra. This is to Tanguy25 from Hayes. I'm sorry.

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1 (Witness reviews document.)2 THE WITNESS: Okay.3 BY MR. BARON:4 Q. I appreciate you wanting to read the whole5 document. I only have a few questions on the first6 three or four paragraphs.7 The first one is, do you see where it8 says, "I believe we have a demand issue"?9 A. Yes.

10 Q. Did anybody ever tell you that, at least11 some people within SolarCity as of February 2016,12 believed that there was a demand issue for solar?13 A. Well, I've seen e-mails like this in many14 of our companies written by -- is -- Hayes I believe15 is a sales leader. And so what I'm reading here for16 the first time is that they needed to deliver17 27,000. He thinks they'll come in at 20,000.18 And the e-mail then goes on to talk about19 the tactics, it looks like, how to bridge the gap20 between 20- and 27-. And so my read of this is21 that -- the conclusion that they have a demand issue22 is not how I read it.23 I read it as a sales leader trying to24 figure out how to bridge the gap, from what he can25 identify looks like mid quarter, since this is

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1 February 22nd, which is midway through the quarter,2 and may have visibility on 20- of the 27- as to what3 they're going to do to actually bridge that gap.4 Q. So the simple answer is, you don't agree5 with Mr. Barnard that they have a demand issue.6 MR. CHESLER: Object to the form of the7 question.8 THE WITNESS: I can't speak for what he did or9 didn't believe.

10 BY MR. BARON:11 Q. And you know none of that was my question;12 right?13 My question was just simply, did anybody14 ever tell you that the head of sales at SolarCity15 believed that, as of February 22nd, he believed they16 have a demand issue?17 A. No.18 Q. Okay. And he also says three19 paragraphs -- couple paragraphs later, "Performance20 marketing has missed their forecast by 50-plus21 percent this year."22 Did anybody ever tell you that, at least23 in Hayes Barnard's view -- that performance of24 marketing missed their forecast by 50-plus percent25 that year?

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1 A. I don't know whether this is their

2 internal forecast, whether this is a stretch

3 forecast, whether this is a Wall Street forecast. I

4 have no idea what -- based on reading this e-mail,

5 what 50 percent miss there was. So I don't know

6 anything about it, and I don't know how to interpret

7 this.

8 Q. And that wasn't my question. My question

9 was very simple.

10 Did anybody ever tell that you Hayes

11 Barnard said performance marketing has missed their

12 forecast for 50-plus this year?

13 Did you ever know that information?

14 MR. CHESLER: Object to form.

15 THE WITNESS: No.

16 BY MR. BARON:

17 Q. And, again, he says, "Answer is demand is

18 way down, customers are now uncertain about solar

19 [and] not sure it's a good investment long term."

20 Did anybody ever tell you that the head of

21 sales was of the opinion that demand is way down and

22 customers are now uncertain about solar and not sure

23 it's a good investment long term?

24 A. No.

25 Q. At the time of the acquisition, did

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1 anybody discuss with the board of Tesla a potential2 shift in SolarCity's business plan from residential3 towards commercial?4 A. I don't know that I would describe the5 conversation as being quite as black and white as6 that. I think that folks thought that within the7 Tesla umbrella that having the Tesla brand would8 enable it to potentially go after bigger9 opportunities, which, of course, are on the

10 commercial side.11 Q. And did anybody tell you whether or not12 the commercial model that was in existence at13 SolarCity was not a model from which the salesman14 believed that they could make money?15 A. Can you repeat that.16 Q. Sure.17 Did anybody ever tell you that from the18 perspective of SolarCity's salesperson, that the19 model that SolarCity was utilizing to increase sales20 in commercial systems was one that did not allow the21 salespeople to make money?22 A. No.23 Q. Did anybody tell you that -- again, in the24 time period between when you first got the25 presentation in February and then you got -- just so

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1 we have a time period -- and in June when you got2 the presentation from -- I believe it was Evercore3 on the possibility of SolarCity acquisition, that,4 in that time period, that SolarCity had multiple5 breaches of liquidity -- or had projected multiple6 breaches of liquidity covenants? Did anybody -- let7 me take that back.8 Again we're talking the time period9 between February and June.

10 Did anybody discuss with you, once you11 became involved, that SolarCity believed that they12 were going to breach their liquidity covenants13 multiple times in the upcoming year?14 A. Just to clarify, so I understand what15 you're asking, clarify whether they would breach16 their covenants in the absence of raising additional17 capital?18 Q. Yes.19 A. I believe so. I would have to go back to20 the Evercore presentation and financial model, but I21 believe so.22 Q. Was that discussed -- I mean, was that23 important to you in any way, to understand what24 their cash position was and whether or not they25 would be breaching their liquidity covenants absent

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1 some other financing?2 A. Well, it was important to the extent that3 it was part of a broader understanding of the4 financials and understanding that -- what the5 business model was, which is, it's a company that,6 like many, essentially created an annuity stream7 when they get a customer.8 And when they do that, it has the benefit9 of having a predictable revenue over time, which

10 often gets valued at a higher multiple than11 otherwise, but has the issue of there being a cash12 need up front.13 As part of those kinds of businesses, I14 understood there needed to have been a set of debt15 that typically was raised which, over time, then got16 paid back with those annuity streams.17 Q. But breaching a liquidity covenant isn't a18 good thing, generally.19 MR. CHESLER: Objection to the form.20 BY MR. BARON:21 Q. Is that a fair statement?22 A. It is.23 Q. Okay. And so it was important to you, in24 making your determination as to whether or not to25 purchase SolarCity, how close or how often they

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1 historically were or were likely to breach their2 liquidity covenants; correct?3 A. Well, it was important to understand4 within -- not whether SolarCity would breach its5 covenants absent the combination per se, but rather6 within Tesla, what were the cash needs for the7 business over time, what were the things that Tesla8 was going to do and not do from a cash standpoint,9 what was Tesla's ability to raise capital around a

10 business vis-a-vis SolarCity.11 So from all that standpoint, sure,12 understanding the liquidity and debt needs were an13 important part of the analysis.14 Q. And a company that either breaches or15 almost breaches its liquidity covenants regularly is16 a riskier company than a company that doesn't;17 correct?18 A. To the extent that that company can't19 raise capital, but to the extent that they have a20 history of raising capital and/or assets that enable21 them to raise capital, then I would describe that as22 part of their business.23 Q. That was an important analysis to you at24 Tesla, was to determine whether or not they had25 the -- again, the same two factors, whether they had

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1 cash to meet their liquidity crisis alone or whether2 they had the ability to raise capital on their own?3 A. Yes.4 Q. And you looked into both of those?5 A. It was more important to me -- not whether6 they could raise it on their own and, more7 importantly, whether, as part of Tesla, Tesla could8 actually raise the capital in order to pursue the9 combined business.

10 Q. But in valuing a company, you want to know11 whether or not that company on its own has a12 business model that is worth what you're paying for13 it; right?14 A. Absolutely.15 Q. So in doing that, you want to know those16 two questions. Because a company that can't pay its17 debts isn't worth that much; correct?18 If ultimately it was -- what was the19 phrase you used -- was in a liquidity crisis or you20 said was going to be insolvent -- a company that is21 insolvent is worth a lot less than a company that is22 solvent; correct?23 A. I agree.24 MR. CHESLER: Object to the form of the25 question.

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1 BY MR. BARON:

2 Q. You said yes. I'm not being very tricky.

3 I'm just saying a company that is insolvent is worse

4 less than a company that is solvent; correct?

5 A. It's a general statement, so one would

6 obviously have to look at the assets of the company

7 that you're describing as insolvent and perhaps not

8 conclude that it is worth less than every other

9 company that is solvent.

10 Q. The same company -- the same company doing

11 the same business, a solvent company is worth more

12 than an insolvent company; correct?

13 A. Typically a solvent company has assets on

14 the balance sheet, and those assets typically would

15 end up being part of a valuation. Those assets

16 would be a component, cash and otherwise. Solvency

17 is a cash test; assets are a separate test. So it

18 is not true that the same company doing the same

19 thing -- one would have to look at what the full

20 balance sheet was in order to figure out which was

21 more valuable.

22 Q. So in the context of SolarCity, it was

23 important for you to determine what the value of

24 that company was to determine whether or not it was

25 solvent on its own, not just solvent if Tesla came

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1 in and saved it?2 MR. CHESLER: Objection as to form of the3 question.4 Go ahead.5 THE WITNESS: We were evaluating what the6 combined assets from a solvency perspective would7 look like. And as part of that, we looked at what8 the SolarCity debt maturities were over time.9 BY MR. BARON:

10 Q. If the company was insolvent, wouldn't you11 want to pay less for it than you would a company12 that was solvent on its own?13 A. Sure. We looked at a set of factors that14 included the cash position.15 Q. Right.16 And in that analysis, you determined, one,17 that the first part of the analysis is the company18 did not have enough cash to pay for its own19 liabilities absent a fund-raising; correct?20 A. Yes.21 Q. And did you share with shareholders in the22 proxy statement that you made that determination?23 A. I would have to look at the proxy24 statement.25 Q. Sure.

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1 And if you want, I can even pull it up on2 a computer and -- if that'll help you. It's a long3 proxy.4 (Witness reviews document.)5 A. So it is a 183-page [sic] document. So6 clearly I could be -- this would take a lot of time7 to actually go through this entire document. I do8 see a disclosure here on page 137 that describes the9 future liquidity needs of the combined company.

10 Q. Yep.11 A. And in that, it describes with detail that12 Tesla, "As of June 2016, had $3.25 billion in13 principal sources of liquidity available from its14 cash and cash equivalents, which included15 $2.76 billion of money market funds."16 Subsequent to that date, Tesla settled --17 (Reporter seeks clarification.)18 A. I'll reread it.19 "As of June 30, 2016, Tesla had20 $3.25 billion in principal sources of liquidity21 available from its cash and cash equivalents, which22 included $2.76 billion of money market funds.23 Subsequent to June 30, 2016, Tesla has settled or24 has become obligated to settle pursuant to25 conversion notices with respect to approximately

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1 441 million in aggregate principal amount of Tesla's2 convertible senior notes due 2018 ('2018 notes'),3 which conversions require Tesla to repay the4 principal amount in cash. Tesla expects to pay this5 amount in the third and fourth quarter of 2016 and6 after giving effect to these conversions, Tesla had7 approximately 205 million in aggregate principal8 amount in 2018 notes outstanding."9 And then it goes on to a second paragraph.

10 Q. What company are we talking about?11 A. Tesla.12 Q. And my question was SolarCity's liquidity.13 A. But my -- so my answer --14 Q. Are you saying that that statement in15 there is talking about SolarCity liquidity?16 MR. CHESLER: Object to interrupting the17 witness' answer.18 THE WITNESS: So what -- I was describing19 whether or not, in trying to actually monetize and20 optimize the asset that Tesla was considering21 buying, whether Tesla had the cash available to deal22 with the obligations associated with buying that23 business. And as part of that, I was reading to you24 at least where the cash was going to come from to25 satisfy those obligations.

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1 BY MR. BARON:2 Q. My question was not that, though, so I'll3 ask my question again.4 A. All right.5 Q. My question was, is there anywhere in the6 proxy that it is disclosed that SolarCity did not on7 its own have sufficient cash to pay its own debt8 obligations?9 MR. CHESLER: Objection as to form.

10 THE WITNESS: Again, it's a 138-page document,11 so I'm doing my best to answer for you based on12 trying to quickly look at the table of contents to13 at least get components of the answer, of which the14 first part that I cited I think was an important one15 in the analysis.16 BY MR. BARON:17 Q. Well, let me ask this question: Do you18 have a specific recollection of that being in the19 proxy statement?20 A. The other thing I was going to mention, if21 I could, is -- I'm looking, and it actually also22 includes -- it looks here, on page 27, as the23 consolidated financial data of SolarCity24 historically, which includes its assets. Its25 assets, it looks like -- at the end of June 30,

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1 2016, it looks like here had 8.2 -- hold on. It2 looks like 8.2 billion of total assets.3 And it looks like it had total current4 liabilities of 1.1 and total -- so current5 liabilities, to your question of what were the6 current set of debt. It looks like current7 liabilities were -- which, of course, is a super set8 to just debt maturing in the near term, but9 nonetheless is 1.1 billion and liabilities overall,

10 6.3 billion, which -- back to your question around11 disclosure around the liabilities of SolarCity, it12 looks like page 27 references the current13 liabilities.14 Q. So in your view, that answers the question15 that the proxy does disclose that SolarCity did not16 have sufficient cash to pay for its debt17 obligations; is that what you're telling me it says?18 A. No. I'm saying in the few minutes here19 I'm looking at the proxy and trying to find, on this20 130-page document, the elements of disclosure, I've21 at least tried to quickly identify the liquidity22 that Tesla had from a going-forward basis and, from23 a SolarCity perspective specifically, where we24 actually show in this proxy the set of current25 liabilities.

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1 Q. That's not my question, though.2 So my question was just -- and, again,3 I'll ask it as simply as possible -- are you aware4 of anywhere in the proxy where it discloses that5 SolarCity did not have and did not anticipate having6 sufficient cash to pay its debt obligations absent7 additional securitization?8 MR. CHESLER: Object to form.9 THE WITNESS: I would have to go through this

10 proxy in a lot more detail to be able to adequately11 answer that.12 BY MR. BARON:13 Q. Now, did you do an analysis about whether14 or not SolarCity had the ability to raise funds to15 pay its debt obligations absent going back to Elon16 Musk-related entities?17 A. You're asking whether I did?18 Q. Or anybody did that you were aware of.19 A. Okay. Well, so the analysis that Evercore20 did -- so we hired financial advisors. And the21 financial advisors did look into a set -- into the22 financials, looked at the debt and looked at what23 was maturing and looked at the full set of24 comprehensive analysis as it related to SolarCity.25 Q. That's not my question, so I'll ask my

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1 question again.2 My question is, are you aware of any3 analysis, either undertaken by you or somebody on4 your behalf, that said that SolarCity on its own had5 the ability to raise capital to pay off its debt6 obligations in any means other than going back to7 Elon Musk or his related entities?8 MR. CHESLER: Objection to form.9 THE WITNESS: Our analysis was about the

10 combination of Tesla and SolarCity, not what11 SolarCity was going to do or not do itself. And we12 wanted to understand the financials of SolarCity --13 BY MR. BARON:14 Q. So the answer is no?15 A. -- not its game plan. And the assumption16 for most companies, when you are running out of17 capital, is that you then raise further capital.18 Q. See, it's not that hard. You can just say19 no, you didn't do the analysis, nor are you aware of20 anyone doing that analysis.21 MR. CHESLER: Objection to the form of the22 question.23 Don't argue with him.24 BY MR. BARON:25 Q. Isn't that what you said? You said --

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1 it's a simple question.2 Did you undertake or are you aware of3 anyone who undertook an analysis to determine4 whether SolarCity had the ability to raise capital5 from sources other than Elon Musk-related entities6 sufficient to pay off its debt obligations?7 MR. CHESLER: Objection to form.8 THE WITNESS: I'd have to go back and look at9 my records to figure out what analysis Evercore did

10 with respect to alternatives to that specific11 financing, but they gave us a lot of analysis in12 their board doc around the assets and value of13 SolarCity, presumably which they would raise money14 off of.15 BY MR. BARON:16 Q. So were you aware of whether or not Bank17 of America Merrill Lynch's risk team was sent out to18 SolarCity to investigate whether or not they were --19 whether or not SolarCity was in a liquidity crisis,20 again, in the time between the first presentation in21 February and the presentation in June?22 A. Not that I recall.23 Q. Would that be significant to you in any24 way, to know whether or not banks who had loans to25 SolarCity was sending out a risk team?

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1 A. I would have to understand more context as

2 to why they sent them out, whether that was a

3 standard meeting, what the circumstances were. But

4 when banks have loans out to companies, sending out

5 risk teams is not something unusual.

6 Q. Have risk teams been sent out to Tesla?

7 A. I don't know how we would describe a risk

8 team per se. I know the banks that loan money to

9 companies, including Tesla, of course come out

10 and -- as part of their both diligence and as part

11 of their ongoing relationship.

12 Q. So let's be -- do you know what a risk

13 team is? Have you ever heard the concept before?

14 Do you know what that concept is?

15 A. I've heard it in broad terms.

16 Q. So when you said it's not uncommon for

17 risk teams to go out to companies, are you talking

18 that a specific team that is there to identify

19 whether or not there is a problem with a highly

20 leveraged company -- whether or not -- are you

21 saying that that is common for those to be sent out

22 by financial institutions to companies?

23 MR. CHESLER: Objection to the form of the

24 question.

25 THE WITNESS: I would have to go back and look

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1 at how often that we see risk teams at Tesla. I can2 look at that and get back to you.3 BY MR. BARON:4 Q. So you're not staying with that answer5 that it's common for risk teams to go out.6 A. Well, I was referring to the broader team7 as opposed to a risk team.8 Q. I'm now asking about a risk team.9 A. As I said, I would have to go back to the

10 Tesla finance team to find out if that was true at11 Tesla as well.12 Q. Okay. So the answer is, you do not know13 whether or not -- you did not know that Bank of14 America Merrill Lynch sent out a risk team in15 May 2016 to SolarCity; correct?16 MR. CHESLER: Asked and answered.17 THE WITNESS: No.18 BY MR. BARON:19 Q. And you don't have a view as to whether20 that is significant or not; correct?21 A. Not in this context, without more detail.22 Q. Do you know who Toby Corey is?23 A. Yes.24 Q. Who is Toby Corey?25 A. I don't recall his title, but I know he

Page 95

1 worked at SolarCity. And I know he worked -- I2 don't know if it was sales per se or he had a3 broader title than sales.4 Q. Do you know whether -- again near the time5 of the presentation in June of 2016 -- whether he6 was brought back onto SolarCity?7 A. I can't recall.8 Q. Did anybody ever tell you that his9 interpretation of the sales system or the sales team

10 was that it is presently broke?11 A. No.12 Q. Would that matter to you in your analysis13 of determining whether or not you were buying a14 company that was worth what you were paying for it?15 A. I would have to know a lot more detail.16 Q. You'd want to know at least -- that the17 head of sales believes that the sales is broke would18 be at least something that you would want to19 investigate further; correct?20 A. I would have to know what context he meant21 it was broke. A company that wasn't selling22 anything would infer that "broke" meant that it23 wasn't working at all. And in a company that was24 actually selling quite a bit, I can't tell whether25 that means he is trying to improve it or it is some

Page 96

1 other definition. But I can't speak for Toby or

2 anyone else because I don't know what that means and

3 what the context is.

4 Q. So now after the present -- now we're

5 going to move to July of 2016.

6 During that time, you were in the process

7 of doing due diligence and you were deciding whether

8 or not to buy the company; correct?

9 A. Correct.

10 Q. Did anybody tell you that SolarCity's

11 bankers had informed the special committee that,

12 based on Lazard's analysis, the company's cash

13 position was close to breaching liquidity covenant

14 under the company's revolving credit facility and

15 that the company would be operating with little

16 margin for error until October 2016?

17 A. No.

18 Q. Now, were you aware that Nancy Pfund was

19 on the special committee?

20 A. Yes.

21 Q. And you knew that other people were

22 involved with SolarCity, such as Mr. Buss and

23 Mr. Musk; correct?

24 A. I don't think Mr. Buss was involved with

25 SolarCity at the time.

Page 97

1 Q. Okay. Mr. Musk was.2 A. Yes.3 Q. And did anybody ask Mr. Musk whether or4 not -- whether or not the company was close to5 breaching a liquidity covenant under the company's6 revolving credit facility?7 A. No.8 Q. Would that be important in your9 determination of what to pay for the company or

10 whether to buy it?11 A. Whether we asked Mr. Musk that?12 Q. No, whether or not you knew that the13 company was close to breaching its liquidity14 covenant under the company's revolving credit15 facility and the company would be operating with16 little margin for error until October 2016.17 A. I thought your question was whether you18 thought -- it was important whether we asked19 Mr. Musk, to which I answered, no.20 A separate question you then asked is, is21 it important as to the substance of the question?22 And that is, in fact, what we talked about earlier23 around the analysis that Evercore did on its24 financials.25 Q. Well -- but Evercore is looking at its

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Page 98

1 financials, but current, real time, SolarCity was2 close to breaching its liquidity covenants. Real3 time, at the very time you were negotiating that, if4 they were close to breaching their liquidity5 covenants, isn't that something that you would have6 wanted to know?7 MR. CHESLER: Objection to the form of the8 question.9 THE WITNESS: We did pursue the set of

10 financials, which ultimately led to a negotiation,11 which ultimately led to discovery of a number of12 facts and ultimately led to the exchange ratio.13 BY MR. BARON:14 Q. I'm sorry. I didn't mean to cut you off.15 Did you know, real time, in July of 201616 that SolarCity was close to breaching its liquidity17 covenants under the company's revolving credit18 facility?19 A. It would be helpful to get the context of20 dates. So is that before or after the solar bonds21 were raised?22 Q. This was simultaneously to seeking to get23 the solar bonds.24 Did you know that?25 A. I don't know what you mean by

Page 99

1 "simultaneously."2 We clearly didn't have a simultaneous3 transaction with solar bonds and approval by the4 Tesla board about the transaction.5 Q. So this was before the solar bonds were6 paid.7 So in July, while you were discussing this8 acquisition, did you know that the company's cash9 position was close to breaching a liquidity covenant

10 under the company's revolving credit facility?11 MR. CHESLER: Objection to the form of the12 question.13 THE WITNESS: We understood the financial14 picture of SolarCity. And as part of that, as it15 related to the liquidity covenant that ultimately16 got solved with the solar bonds, I recall we ended17 up putting as part of the transaction a contingency18 such that if that liquidity crisis weren't solved,19 that we, as Tesla, actually could pull back.20 BY MR. BARON:21 Q. So you were aware that they were close to22 breaching the liquidity covenants. That was23 something that you were aware of.24 A. In the absence of raising further capital,25 yes.

Page 100

1 Q. Were you aware that management of2 SolarCity was preparing a restricted liquidity model3 for running their business?4 A. No. We weren't involved with what5 SolarCity was doing. We were involved in the Tesla6 side.7 Q. Again, you're doing due diligence.8 Did anybody -- during this due diligence9 process, did anybody tell you, hey, they're

10 concerned enough about their liquidity that they're11 actually preparing a restricted liquidity model?12 A. I do recall, during the course of the13 diligence, there ended up being evolutions of the14 model that included more conservative analysis and15 forecasting. And I can't recall what the label was16 and what you're identifying as the label of that,17 but I do recall that there were a number of18 forecasting evolution that incorporated a set of19 conservatism.20 Q. Do you understand -- and we're talking now21 July. Right. In July of -- we're in the middle of22 due diligence, in the middle of negotiations -- that23 there was sufficient concern about liquidity that24 they were preparing a sensitivities case as to how25 to operate the company with less -- with the

Page 101

1 liquidity problem?

2 MR. CHESLER: Objection to the form.

3 THE WITNESS: You know, most of the companies

4 I've been involved with do a conservative

5 sensitivity analysis. And so the notion that they

6 were doing that for a specific reason was not known

7 for us other than we identified a set of more

8 conservative assumptions as part of our diligence

9 process.

10 BY MR. BARON:

11 Q. Well, did anyone ever tell you that the

12 model that they were preparing to possibly -- let me

13 ask you two questions.

14 First, as far as you know, did SolarCity

15 ever operate under a restricted liquidity model?


17 Q. Were you buying a company that would be

18 operating under a restricted liquidity model?

19 A. We would be buying a company for its set

20 of assets and for the value that we thought we could

21 actually derive as a combined entity, as opposed

22 to -- there are some acquisitions where the

23 companies are run separately. There are

24 acquisitions where what that company's cash balance

25 sheet and the way it operates are, alone, what you

26 (Pages 98 - 101)


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Page 102

1 evaluate.2 But that was not the case here, nor3 what -- the full set of what was analyzed as part of4 the value to Tesla.5 Q. Were you buying the business to operate6 under a liquidity-restricted model, or were you7 buying the company to continue to grow and grow the8 solar business?9 MR. CHESLER: Objection to the form.

10 BY MR. BARON:11 Q. What was your thought of the business you12 were buying?13 A. Number one, it was the largest solar14 company in the industry. And so the ability to have15 a vertically integrated strategy around solar, a16 company that had sales that led to it being in the17 number one position in the industry, a sales18 methodology, a set -- the full chain of what is19 needed in order to actually run a solar business led20 to SolarCity becoming the number one player. That's21 one.22 Two, we bought it because, at the end, we23 thought we got a great price for the company.24 Three, we got it because when we paid that25 price, we didn't have a lot of -- we thought that

Page 103

1 the synergy that we could bring from a Tesla2 perspective would bring a lot of value.3 And, four, we also bought it for the4 future value of Solar Roof. But we didn't buy it to5 somehow continue the business exactly as it was6 operating, and it wasn't the analysis we did.7 Q. Were you buying a growth business or were8 you buying a stable business? Were you expecting to9 grow the business, or were you expecting it to just

10 stay stable or go down?11 A. You would have to clarify over what period12 of time.13 Q. Overall.14 A. Over a long period of time, we expected15 this to be a great growth business.16 Q. And that's what you thought you were17 buying, a business that could grow?18 A. Well, again, depending over what period of19 time, we thought that sales were too high as a20 standalone company at SolarCity, which represented a21 big percentage of their expenses. We thought the22 synergy you could get from actually having the Tesla23 sales and Tesla brand and co-selling product over24 time would enable us to reduce sales cost, which we25 thought would lead to a real advantage of being

Page 104

1 under the Tesla umbrella.

2 And we thought, long haul, what we could

3 really do was help build a product out which could

4 have a transformative impact with the Solar Roof.

5 Q. Again -- I got all that. I'm just -- it

6 was a very simple question. I'm a simple guy.

7 Were you buying this as a growth -- were

8 you buying it with the expectation that, over the

9 long haul, it was going to be a bigger company than

10 you bought, or were you buying it just to maintain

11 whatever size it was?

12 MR. CHESLER: Object to the form and as asked

13 and answered.

14 THE WITNESS: Unfortunately, as a board member,

15 I can't simplify it the way you're asking the

16 question. And I can't -- we don't look at it as we

17 are buying it for only one specific reason that is

18 binary as a yes or no; instead, we bought it for a

19 set of reasons, as I described.

20 BY MR. BARON:

21 Q. Okay. Would it matter to you if

22 management of SolarCity did an analysis that was how

23 they would run the company under a

24 liquidity-restricted situation that actually showed

25 a devaluation of the value of the company? Would

Page 105

1 that matter to you?

2 A. I'm not sure how to interpret your

3 question. Can you explain.

4 Q. Sure.

5 I'll actually show just you the document.

6 A. Okay.

7 MR. BARON: This is the 7/13.

8 6.


10 BY MR. BARON:

11 Q. Showing you a document that was e-mailed

12 around -- on July 13th, 2016 from a Matthew Tappin

13 to a number of people at SolarCity. And it says

14 attachment was -- "5 Year Plan Sensitivities" was

15 the subject.

16 Go to the second page. You can see that

17 there is a discussion of changes to the business and

18 the cash impact.

19 Do you see that?

20 MR. CHESLER: Counsel, I'm sorry to interrupt.

21 It's not from Matthew Tappin.

22 MR. BARON: Who's it from? It's to Matthew

23 Tappin from Alex Wooten.

24 THE WITNESS: I don't know who Alex Wooten is.

25 Could you tell me who that is?

27 (Pages 102 - 105)


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1 BY MR. BARON:

2 Q. No.

3 A. I don't know how to interpret the context

4 of this without knowing who sent it.

5 Q. So it wouldn't matter to you -- it would

6 only matter to you if you knew who these people

7 were?

8 A. In order to judge the intent, the

9 credibility, what the -- where these numbers came

10 from, I just don't know.

11 Q. Now, again, you don't know one way or

12 another whether or not management prepared -- or

13 there was any presentation to the board of directors

14 about a restricted-liquidity case, or you do know

15 that that existed?

16 A. Can you clarify. Are you asking me

17 whether I knew what SolarCity's management presented

18 to SolarCity's board?

19 Q. Yes.

20 A. No.

21 Q. Okay. Do you know whether or not a

22 restricted-liquidity case exists?

23 A. Exists in what fashion? Can you clarify.

24 Q. That it's there. That somebody did an

25 analysis on a restricted-liquidity case and did some

Page 107

1 valuation on that.

2 A. I know that during the course of our

3 diligence, there were a set of forecasts done which

4 actually showed conservatism and discounted the

5 assumptions made.

6 Q. Was that important -- was that analysis

7 important to you in your consideration on whether to

8 buy SolarCity at all?

9 A. Well, it was important that the financial

10 advisor that was representing Tesla prepared a set

11 of documents around the financials. But you keep

12 asking me about what SolarCity's management did

13 vis-a-vis SolarCity's board or how it operated or

14 would operate under a separate entity, and that I

15 have no knowledge of.

16 Q. Again, in the context -- do you see on the

17 bottom, on the second page, where it talks about

18 "Retained value impact" and "Value creation impact"?

19 Do you know what those two lines mean?

20 A. Not in this context.

21 Q. Okay. All right. Do you know, as of

22 July 18th -- because we've been talking about

23 liquidity -- how much the company -- how much

24 SolarCity needed in order to maintain operational

25 flexibility? In order to maintain the operations,

Page 108

1 do you know, as of July 18th, how much the company2 said they needed?3 A. I would have to look at documents in order4 to refresh any memory.5 Q. Is it more than 200 million, more than6 500 million? Do you have any sense one way or the7 other?8 A. You're asking me about a specific date and9 a specific set of numbers. I would have to go back

10 to the documents that were presented to the board in11 order to answer that.12 Q. Okay. Is it your view that the board of13 directors of Tesla did -- was actually provided with14 information that showed how much money Tesla [sic]15 needed in that interim before a merger agreement was16 signed in order to not trip their debt covenants?17 MR. CHESLER: Did you mean to say "Tesla"18 there? You said, "Tesla needed."19 MR. BARON: I apologize.20 BY MR. BARON:21 Q. That SolarCity needed a particular amount22 of money in order to not trip their debt covenants?23 A. Again, we were provided a set -- a summary24 of the debt, the timing and ultimately the window25 around what SolarCity's financial picture looked

Page 109

1 like. So of course it was important and, yes, we

2 got that information.

3 Q. Okay. Was there similarly any discussion

4 about what SolarCity could announce or should

5 announce on its August 4th earnings call?

6 A. Could you repeat the question.

7 Q. Yes.

8 Was there any discussion about

9 SolarCity -- what they could report as far as their

10 cash position or their megawatt guidance on the

11 August 4th conference call? Was that in any way a

12 consideration of the board of directors?

13 A. Of Tesla or of SolarCity?

14 Q. Of Tesla.

15 A. Not that I recall.

16 Q. If SolarCity stock went down upon a

17 negative announcement, would that have been good or

18 bad for Tesla in the negotiations?

19 A. Because it was stock for stock, we had an

20 exchange ratio, so --

21 Q. Before the merger agreement was signed.


23 question.

24 BY MR. BARON:

25 Q. Before the merger agreement was signed, if

28 (Pages 106 - 109)


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Page 110

1 SolarCity stock had dropped substantially on the

2 basis of a revised downward -- downward guidance on

3 megawatts and an announcement of a low cash

4 balance -- presume that for me -- would that have

5 been good or bad for Tesla?


7 THE WITNESS: You would have to clarify when

8 you're talking about.

9 BY MR. BARON:

10 Q. Talking about -- the merger agreement was

11 signed in August; correct? So prior to the merger

12 agreement being signed.

13 MR. CHESLER: I'm sorry, Counsel. It wasn't

14 signed in August. I think it was signed July 30th.

15 MR. BARON: Okay.

16 BY MR. BARON:

17 Q. Prior to signing the merger agreement, if

18 the stock price -- if the stock price of SolarCity

19 had dropped substantially based upon a disclosure of

20 a reduced megawatts percentage -- or megawatts and a

21 cash position that was challenging, would that have

22 been good or bad for Tesla?


24 THE WITNESS: Well, you're asking me to

25 hypothesize if the facts changed from what the

Page 111

1 decision -- the facts were at the time we made the2 decision, would that have influenced. I would have3 to understand the timing and --4 BY MR. BARON:5 Q. Well, the lower -- if SolarCity had a6 lower stock price, Tesla on the exchange ratio would7 have been able to get it cheaper; correct?8 A. Your question assumes that the exchange9 ratio actually would have stayed constant. I don't

10 know -- you're throwing out a set of hypotheticals11 that didn't exist that I can't answer.12 Q. So are you aware -- let me ask you this13 way: Are you aware of whether or not SolarCity14 believed that they needed to reduce their estimate15 for megawatts -- reduce their guidance for16 megawatts?17 Are you aware of that?18 A. I don't recall.19 Q. Again, this is before the merger agreement20 was signed.21 Would it have mattered to you?22 A. What mattered to me ultimately was the23 full set of information we got at the time we made24 the decision. So when we talk about what happened25 before, it's unclear to me whether you're talking

Page 112

1 about coincident with making the decision, whether2 you're talking about months before, whether you're3 talking about three weeks before and then we4 deliberated after.5 I just don't know what you're referencing.6 Q. So it doesn't matter to you what the7 market knew -- what the market knew about SolarCity8 wasn't of import to you; correct?9 MR. CHESLER: Objection to the form of the

10 question.11 THE WITNESS: I didn't say that.12 BY MR. BARON:13 Q. That's my question.14 My question was, would it matter to you if15 SolarCity was holding back on their announcement of16 a reduced guidance on their megawatts?17 A. That's different than --18 MR. CHESLER: Objection to form.19 BY MR. BARON:20 Q. That's the question I'm asking now.21 A. Can you repeat it.22 Q. Yeah.23 Would it have mattered to you if SolarCity24 was holding back on a view that they had to give25 reduced guidance on their megawatts?

Page 113

1 MR. CHESLER: Objection to form.2 THE WITNESS: I would have to understand a lot3 more details, what percentage, the magnitude over4 time, how it related to the overall asset that we5 thought that we were buying, the degree to which6 that impacted our -- the context of our own7 valuation analysis. It's just not enough8 information.9 Was it reduced by .03 percent?

10 BY MR. BARON:11 Q. Reduced from 1.1 billion -- or 1,100 to12 900.13 A. Over what period of time?14 Q. For the year.15 A. For the year. So when we made the16 decision to buy SolarCity, we were not making the17 decision with a myopic view of what it was going to18 do over the next six months. So if you're asking me19 whether it would have mattered to me whether or not20 there was a 20 percent reduction over the calendar21 year, I would also have to understand if that was22 the only revision and a lot more detail to answer23 that.24 Q. Okay. So you can't answer whether or not25 it would have mattered whether they disclosed it or

29 (Pages 110 - 113)


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1 not to your analysis.2 A. I would have to understand the materiality3 relative to the broader decision that was being4 made.5 Q. That was never discussed one way or the6 another, that you recall, the megawatt guidance.7 A. I can't recall.8 Q. And what about disclosure of their cash9 balance? Not whether you knew about their cash

10 balance or not, but whether or not the market as a11 whole was aware of the cash balance at SolarCity.12 Was there any discussion about whether13 that should be disclosed prior to entering into a14 merger agreement?15 A. Just so I understand your question, you're16 asking whether the Tesla board discussed whether the17 SolarCity board ought to have certain cash18 disclosures?19 Q. Yes.20 A. Not that I can recall.21 Q. Would that have mattered to you at all,22 what they disclosed as far as their cash balance23 prior to entering into the merger agreement?24 A. It would depend on materiality as to how25 it would influence my answer.

Page 115

1 MR. BARON: Let me -- we'll do one more2 document before we break for lunch.3 Can I have the Lazard presentation.4 July 18.5 Mark that as Exhibit 7.6 (Ehrenpreis Exhibit 7 was marked.)7 BY MR. BARON:8 Q. This is a presentation by Lazard to the9 SolarCity special committee. I'm assuming you've

10 never seen this before.11 A. I have not.12 Q. So there's information here that I was13 wondering whether or not the Tesla board was either14 aware of or -- and/or considered. And so let's go15 to the first page -- or I guess it's the second16 page. And it's Lazard 39343, if you look at the17 Bates range down at the bottom.18 Do you see those numbers?19 A. I do.20 Q. And this talks about the21 unrestricted-liquidity case.22 Do you see here that there's a discussion23 about SolarCity's liquidity position on the24 left-hand side of that box?25 A. I do.

Page 116

1 Q. Do you see where it says, "The revolver2 liquidity covenant (in relation to the financial3 covenant with respect to 'unencumbered liquidity')4 as of June 2016 was $117 million and is not5 currently expected to move significantly"?6 Do you see that?7 A. I do.8 Q. Is that information that the SolarCity9 [sic] board was aware of through due diligence?

10 MR. CHESLER: Objection to the form.11 You said, "the SolarCity board."12 MR. BARON: I'm sorry.13 BY MR. BARON:14 Q. The Tesla board was aware through due15 diligence.16 A. I would have to go back to look at the17 Evercore docs to figure out -- I don't recall18 specifically whether or not this specific number --19 what it was with a degree -- with the detail.20 But, yes, we did have an understanding of21 what the financial covenants were and the debt at22 SolarCity more broadly.23 Q. And the concept that where it says was not24 expected to move significantly, were you aware of25 that as well?

Page 117

1 A. I can't recall.2 Q. Were you aware of -- that the period3 between May and August 2016 marks a period of risk4 whereby SolarCity potentially trips its revolver5 liquidity covenant? Were you aware that that was6 the time period that was most at risk?7 A. Just to refresh my memory, can you remind8 me again when the solar bonds were raised?9 Q. Solar bonds were raised on -- I think it

10 was August -- solar bonds were August 17th.11 A. August 17th.12 So as I said before, I knew that -- I13 think the Tesla board knew that they needed to raise14 some additional capital which, as you're describing,15 got done in August. And as part of that, I know we16 had the documents around the timing of maturity.17 Q. But just so -- Mr. Chesler made clear that18 I knew this -- was that -- the merger agreement was19 signed on July 30th; correct?20 A. Correct.21 Q. So before the solar bonds were issued;22 correct?23 A. Correct. And as I said before, we also24 said that to the extent that they didn't solve their25 liquidity prices, we baked that into the merger

30 (Pages 114 - 117)


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Page 118

1 agreement that you're referencing in late July that

2 subsequently -- as you described, the solar bond

3 date happened thereafter, but before the transaction

4 was consummated.

5 Q. Yeah. And I'm trying to make sure that we

6 understand what you knew at the time -- before the

7 solar bonds were purchased, but after -- and prior

8 to signing the merger agreement, you were aware that

9 the period between May and August marked a period of

10 risk whereby SolarCity potentially trips the

11 revolver liquidity covenant; correct?

12 A. It's a degree of detail that -- I can't

13 recall whether the May through August specifically

14 was referenced, but I did, and continue to say, that

15 the board understood that the SolarCity side needed

16 to raise more capital and, in fact, if it didn't,

17 Tesla baked that concept into the merger agreement.

18 Q. Did you understand how many times between

19 April and October they were going to trip their

20 liquidity covenant or they were expected to?

21 A. I would have to go back to the Evercore

22 docs to refresh.

23 Q. Do you believe that the Evercore docs

24 actually discuss specifically which months they were

25 going to trip their liquidity covenant?

Page 119

1 A. I don't recall.2 Q. So just -- and we'll flip back in a3 moment, but if you flip to page 3 of the4 presentation, 39345.5 Do you see here that it indicates that6 they are going -- that they are expected to trip7 their liquidity covenants one in April, July,8 August, September and October?9 Do you see that?

10 MR. CHESLER: Objection to the form of the11 question.12 THE WITNESS: I'm seeing this chart for the13 first time. It's in black and white and it's hard14 to tell what these bars are. Can you explain?15 BY MR. BARON:16 Q. Bars are the cash balance. But I'm just17 looking at the numbers. And you can see where there18 is the liquidity covenant, which is in the striped19 number or the broken-up number. And then below20 that -- I think that's 117. And then below that is21 102 as to what their liquidity balance is, and it22 shows 102 in April.23 Do you see that?24 Do you see where it says, in April,25 above -- do you see where it says, "102"?

Page 120

1 A. I do.2 Q. Did you understand -- did anybody ever3 tell you that there was a possibility that they4 would trip the covenant in April?5 A. As I said, I would have to go back to6 figure out what docs were presented and whether they7 did it on a monthly basis, a cumulative basis. I8 don't recall, sitting here, the details around9 whether or not -- you're presenting me with what

10 SolarCity's bankers presented to SolarCity's board,11 which I've never seen.12 I would have to go back to the Evercore13 presentation to figure out in what form, in what14 fashion it described the overall concept that we've15 talked about, which is that there was an upcoming16 liquidity issue that SolarCity needed to resolve17 prior to the merger.18 Q. And I'm only asking you if you have19 specific recollection of ever being told that they20 were going to actually -- likely to be below their21 liquidity threshold one, two, three, four -- five22 times between April and October, and one time23 exactly meet their liquidity threshold.24 MR. CHESLER: Objection to the form of the25 question.

Page 121

1 THE WITNESS: I don't recall.2 BY MR. BARON:3 Q. And, again, just from this page, was it4 your understanding that there would be -- I think5 this is consistent with what you were saying that,6 absent there being some other financing, you were7 aware that they didn't have enough cash.8 But were you aware that they would be9 $200 million in the negative on their cash from

10 their balance sheet?11 MR. CHESLER: Objection to the form.12 BY MR. BARON:13 Q. Do you see that on the lower right-hand14 side?15 A. No, I don't see.16 Q. Do you see where it says No. 6?17 A. I don't see that, no.18 Q. It's on -- back on page 1. I don't know19 what page you are on. I'm sorry. My bad.20 MR. CHESLER: Back on 343?21 MR. BARON: Yes.22 BY MR. BARON:23 Q. Do you see, down on the bottom, No. 6,24 "Cash from Balance Sheet"?25 A. I see that number.

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Page 122

1 Q. Okay. You don't understand that to be2 that they would be minus 200 million on their --3 from their cash?4 A. I don't know what this was -- what the5 assumptions were behind this analysis because it's6 the first time I'm seeing it. I see that based on7 the assumptions of this document by SolarCity's8 bankers to SolarCity, that it is showing a negative9 200 on this slide, but I don't know what the

10 assumptions were behind it.11 Q. Okay. Do you have any understanding --12 you testified you believed that they didn't have13 sufficient cash to pay their obligations.14 Do you know how far below zero they were?15 A. I don't recall right now what the gap was16 around that.17 Q. Okay.18 A. But I know we got presented with the19 financial information at the time, and I know that20 we baked in the fact that they needed to solve it.21 Q. Go to page 4 of the Lazard presentation.22 That's 346.23 Do you know whether or not any of your24 advisors or Tesla management gave the board an25 update of 3Q 2016 week-by-week liquidity?

Page 123

1 A. I don't recall whether it was2 week-by-week.3 Q. Again, if you take a look at this, it4 shows seven times -- seven times that it was below.5 Once it was at the threshold.6 Is that information that you were aware of7 or that really would be part and parcel of the other8 information you received from Evercore?9 MR. CHESLER: Objection to the form.

10 THE WITNESS: What's the date of this document11 you're showing me?12 BY MR. BARON:13 Q. July 18th, I believe.14 A. So looking at this page for the first15 time, it looks like the number of times that you16 just referenced were subsequent to the date of this17 document. So what it looks like is a forecast. And18 what is not included on the document you're showing19 me is what the underlying assumptions were of this20 forecast.21 Q. Is it your testimony that you believe you22 got a similar forecast, at least on some level, from23 Evercore?24 MR. CHESLER: Objection to the form.25 THE WITNESS: What I said about Evercore was

Page 124

1 that they presented us a picture of the SolarCity

2 financials and that -- without seeing the specific

3 document and set of documents, that I couldn't

4 recall whether they did it in the same form that

5 you're showing me now that Lazard did it.

6 MR. BARON: Shall we take a break for lunch or

7 should we go on a little longer?

8 (Discussion off the record.)


10 The time is 12:18 p.m., and this is the end of Media

11 Unit No. 2.

12 (Lunch recess was taken at 12:18 p.m.)

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4 12:56 p.m. and this is the beginning of Media

5 Unit 3.

6 EXAMINATION RESUMED

7 BY MR. BARON:

8 Q. Perhaps you can clarify something for me.

9 Did the board of directors of Tesla know

10 how SolarCity was going to get financing to solve

11 their liquidity crisis before the merger agreement

12 was signed, or did you simply put in the merger

13 agreement that if they don't get financing before

14 the close, then you could walk away?

15 A. Can you remind me. You said the merger

16 agreement was signed --

17 Q. July 30.

18 A. And you said the financing happened how

19 many weeks later?

20 Q. August.

21 A. August what?

22 Q. August 17th.

23 A. So I can't recall, in that 18-day window,

24 what we knew when and when the facts unfolded. I

25 just can't recall whether there was the 18-day

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1 window -- whether there was visibility before2 July 30th or not.3 Q. Well, did you know -- so the reason it4 matters is, you do realize that the source of that5 funding was Elon Musk, his cousin and SpaceX;6 correct?7 MR. CHESLER: Objection to the form.8 THE WITNESS: I knew that they invested. I9 also knew they were shareholders -- that Elon was a

10 shareholder in SolarCity at the time.11 BY MR. BARON:12 Q. No, I'm just saying that was the source.13 There weren't any other investors for those bonds.14 A. As I mentioned earlier, I can't recall if15 there were others.16 Q. And so my question is, was it part of your17 consideration when you actually signed the merger18 agreement that you expected or anticipated that19 SolarCity would be -- I don't want to use the word20 saved -- but would be funded for their liquidity21 crisis by Mr. Musk and entities related to him?22 A. As I said, I can't recall the timing of23 knowing who was funding when, other than to know24 that we, as a board, baked it into the merger doc.25 Q. Were you aware -- it may not even matter

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1 to you, but were you aware of whether -- from a2 SolarCity perspective, that they considered the3 acquisition of SolarCity by Tesla to be a solution4 to avoid the risk of the downside liquidity5 scenario?6 A. Just to understand your question, that7 that was an official SolarCity position that was8 somehow espoused somewhere?9 Q. Yes. In their board minutes that they

10 were considering not only the price being paid, but11 also that it was, quote, "a solution to avoid the12 risk of downside liquidity -- of the downside13 liquidity scenario."14 A. I haven't seen SolarCity's board minutes.15 I don't know what the context is. I don't know if16 that was one of several potential things they were17 considering. I just don't know.18 MR. CHESLER: Counsel, I'm sorry. Can I ask19 you a question.20 Did you say "downside" or "downsized"?21 MR. BARON: "Downside."22 MR. CHESLER: Okay. Thank you.23 BY MR. BARON:24 Q. And, again, I understand you didn't know25 that. I was wondering -- or you didn't see the

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1 board minutes. I'm wondering whether or not, from2 your position on this Tesla board of directors, you3 were thinking, what does SolarCity get out of this4 and is one of the things SolarCity is getting out of5 this is that it is a solution to avoid the risk of6 the downside liquidity scenario?7 MR. CHESLER: Objection to the form.8 THE WITNESS: As a Tesla boarder, I was9 evaluating what the value would be to Tesla, not to

10 SolarCity.11 BY MR. BARON:12 Q. All right. Do you recall being made aware13 of a new set of projections that were prepared at14 SolarCity after -- let me take that back.15 Did you become aware, after you signed the16 merger agreement, that SolarCity had a downside set17 of projections?18 A. I can't recall the timing of when the19 forecast evolved. I can tell you that during the20 process, I do remember that there were different21 scenario that -- scenarios that they ended up --22 that the combination of the Tesla side, SolarCity23 side, Evercore, we saw a number of different24 financial forecasts over time.25 Q. Did you get any additional financial

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1 valuation information from your bankers after you2 signed the merger agreement? Or did you receive all3 of your financial valuation work before the merger4 agreement?5 A. I'd have to go back. I don't recall6 what we got -- obviously we got a lot before. I7 would have to go back and see what we got after.8 Q. You don't have any specific recollection9 of receiving anything that you can point to right

10 now?11 A. I don't recall whether we got something12 from Evercore per se or whether -- but I do know13 that on Tesla's side over time, as the -- and I14 don't recall what the timing of this was, but I know15 over time there was absolutely a discussion and16 forecasting around the solar business.17 Q. You a moment -- or this morning sort of --18 and I should have written it down, so I apologize.19 But you said that you were buying SolarCity for a20 number of factors; right?21 And you said that you were buying it22 because you believed that it could -- I think one23 was that it would integrate with Tesla's current24 business model. I think that was one of the25 reasons; right?

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1 Do you recall -- I think it was four2 reasons that you gave.3 Do you recall what those were?4 A. I don't recall specifically, but to5 your -- in response to your question, I do recall6 saying that the idea of having an integrated energy7 business where solar was a part of that integrated8 vision was something that we long had. And I do9 recall earlier pointing to -- even before I

10 invested, talking about what the vision of Tesla was11 relating to solar.12 Q. The reason for SolarCity, in particular.13 I'm not talking about generalized -- some solar14 acquisition. The reason for SolarCity, you said15 something about the fact that one was, I thought, an16 integrated business, two was the Solar Roof, three17 was synergies. And I thought there was maybe one18 more.19 Do you recall testifying to that?20 A. I would have to go back and look exactly21 at what I said to repeat the four. I don't know.22 Q. Well, why -- then I'll just ask you that23 question.24 I think it was in context -- so I'll ask25 you that same question again.

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1 Were you buying SolarCity with the2 expectation that you were buying it as a growth3 company, a company that was ultimately going to be4 bigger, stronger, worth more than it currently was5 at the time that you bought it?6 A. Yeah. As I said earlier, clearly the7 rationale for buying it was a function of what it8 could add to the growth of the Tesla business, but I9 tried to clarify for you that I don't look at that

10 based on what it's going to do in the near term. I11 look at that as what can this do long haul.12 And I further went on to describe, as I'll13 reiterate now, that it's both a combination of what14 I would call the historic and core business of15 SolarCity historically, which is where the16 financials of this transaction and Evercore had17 focused, but also as it related to the Solar Roof,18 and the idea of buying something that was19 potentially transformative to Tesla's business and20 could have tremendous growth potential inside Tesla.21 Q. And I guess we've been really talking22 about the core business. And the liquidity issues23 and all of those issues have to do with the core24 business. Would that be in your definition?25 The liquidity issues, we're talking core

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1 business issues; right?2 A. I would describe it as the liquidity3 issues that you've been asking about relate to where4 SolarCity was at that particular instance in time as5 it related to the full SolarCity business, absent6 Tesla, and in that particular temporal window.7 Q. Okay. And couple of things -- Silevo, you8 know what that is?9 A. I do.

10 Q. What is Silevo?11 A. It was the technology they bought to get a12 higher efficiency, lower cost module.13 Q. As part of the business of SolarCity, it14 was a desire to actually start to build their own15 solar panels as opposed to buy them from third16 parties; correct?17 A. I don't know if I would say "as opposed18 to." Having one's own integrated modules enables a19 company, and in SolarCity's case in particular, to20 both have one's integrated vertical supply chain as21 well as being able to access third-party supply22 chain.23 Q. And how did the Silevo --24 Is that how you say it?25 A. Silevo.

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1 Q. -- Silevo factor in to your determination2 of the acquisition?3 A. You know, it's hard to isolate any one4 specific asset. It was one of the aspects to it,5 but it wasn't -- I didn't look at it as somehow this6 was the isolated reason to buy SolarCity. And I7 didn't ascribe a percentage to it. I looked at the8 overall assets that SolarCity had.9 Q. Was it a viable business entity --

10 MR. CHESLER: Objection to the form.11 BY MR. BARON:12 Q. -- on its own?13 A. Are you asking me whether it would be14 viable inside Tesla?15 Q. When you were looking at it as an asset16 that you were acquiring, one of the assets was their17 interest and their development of Silevo.18 Did you determine that to be a valuable19 asset?20 A. You know, it's hard to quantify valuable.21 What I would say is we had a general viewpoint that22 any new technology that we were buying, which23 included the Silevo asset as well as the Solar Roof,24 we thought that Tesla was in a better position to25 both achieve product success with that and scale

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1 that product success relative to being inside2 SolarCity.3 Q. So did you or your bankers do any analysis4 as to whether or not Silevo was going to be a5 business that Tesla was going to continue or was a6 business that Tesla was going to terminate once they7 acquired?8 A. I don't recall the analysis somehow9 bifurcating or sleeving off the Silevo business as

10 opposed to it being an aggregated discussion. I11 would have to go back to the docs to somehow get12 into the details around that core business.13 Q. That business isn't being proceeded with;14 right? They went to the Panasonic partnership15 instead; correct?16 A. At this point in time, the Panasonic17 business, I believe, is a lot more in volume, but I18 don't know that I would have concluded abandoned --19 abandoned permanently.20 Q. Are you still investing in Silevo? Are21 you still trying to develop integrated production22 through Silevo?23 A. Well, the broader question is where the24 solar resources have gone. And at this point in25 time, they've been moved over to the Panasonic

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1 partnership more so than the Silevo. But that's not2 a permanent statement per see. It may be what the3 company decides operationally, but may not.4 Q. Well, I'm confused about that. I thought5 I had read that the engineering that was going --6 the majority of engineers were working on the7 Model 3 and not on either -- not on either Panasonic8 or Solar Roofs.9 Is that not correct?

10 A. The question you just posed is not11 inconsistent with what I said. I was referencing12 to -- referencing on the solar side where resources13 were going.14 Q. What kind of resources are you talking15 about? Are you talking engineering resources, R&D?16 A. The collective.17 Q. And are you saying that you're no longer18 providing any engineering R&D resources to Silevo19 and those are being allocated elsewhere?20 A. What I was saying was, as it relates to21 the solar resources that are being allocated, there22 is a greater allocation on the non-Silevo part of23 the solar asset. And, in particular, there's a lot24 of work being done right now on the Solar Roof.25 Q. Does that mean that the engineers that had

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1 been allocated to the Model 3 are back on Solar Roof

2 now? Or was there not really a reallocation of

3 resources?

4 A. You know, I would have to look at the

5 organizational chart. We have over 40,000 employees

6 at Tesla. And so I can't speak, without looking at

7 some detail around the org chart, as to that right

8 now.

9 Q. So as you sit here right now, you don't

10 know what the allocation is between Solar Roofs and

11 Model 3, but you do know that there's -- in a

12 comparative basis, there would be more on Solar

13 Roofs than there would be on Silevo?

14 A. There's more on auto than there is on

15 solar. I would have to go back and look. What I

16 have been familiarized with is more on the Solar

17 Roof side. But it's too big of a conclusion without

18 looking at the facts to where other solar resources

19 are going.

20 But at least as it relates to the strategy

21 and the excitement as to the future, I have had a

22 lot more briefing on the Solar Roof than I have on

23 the Silevo side.

24 Q. So there are substantial resources right

25 now being -- Solar Roof as opposed to Model 3, so

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1 that there hasn't been a reallocation? I'm just --2 A. Your question just added something that3 was inconsistent with what I just said, which is,4 as -- you said "as opposed to" the Model 3, which I5 did not say. In fact, I did say there's more6 resources going into auto than solar.7 Within solar, there has been more8 conversation that I have had around -- and briefing9 on the Solar Roof than I've had on other parts of

10 the solar business, because that's where the future11 transformative potential lies.12 Q. And was that your view -- was that your13 view at the time of the acquisition, that you were14 substantially focused on the Solar Roof?15 Again, you said there wasn't a whole lot16 of breakout of focus on Silevo.17 Was there breakout and focus on the18 Solar Roof?19 A. Well, it's hard to break it out the way20 you're asking it for the following reason: It21 doesn't help to have -- the Solar Roof is clearly22 the transformative breakthrough potential23 technology. The idea of being able to pay for a24 Solar Roof the same as what you would pay for a roof25 is something so compelling as to have never been

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1 achieved in world history, and as a value prop to2 the end customer that was so exciting that, if3 achieved, would have transformative value to Tesla.4 So clearly that is an important asset.5 However, one can't isolate that asset.6 Because assuming you now have a Solar Roof, the7 Tesla assets that we have do not include a sales8 force and an installation in particular because we9 do not install cars on top of roofs.

10 So having that integration as another11 component to the asset is another key part. So12 isolating those two does not actually give the value13 to having both the integration of the historic --14 the integration side of the core historic business15 as well as -- which, by the way, was not included, I16 don't believe, in the Evercore model, which is the17 value of the transformative Solar Roof side, since18 the CDF was based on, as you described, the core19 asset.20 So everything on the Solar Roof side would21 have been upside to that Evercore model. So as a22 board member, I looked at that and thought we are23 paying a price based on core, and the synergy of24 putting that transformative asset inside Tesla could25 potentially drive incredible growth opportunity,

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1 consistent with what we did with the automobile when

2 people said we couldn't produce it.

3 Q. We'll get to the synergy in a while.

4 The synergy you were talking -- we're

5 talking about some combination of the sales process,

6 selling Teslas along with the Powerwall, along with

7 the SolarCity systems, same place?

8 A. No.

9 Q. Well, what synergies were you talking

10 about?

11 A. SolarCity, at the point of acquisition,

12 had a historic success selling a product that would

13 not necessarily have been described as

14 world-changing transformative technology and unique

15 IP on its own. The Silevo notwithstanding, but the

16 core business of having procured over a period of

17 time third-party panels meant that they were taking

18 other people's product and putting it within a

19 company that had a sales and financing and

20 integration piece where they actually achieved

21 success of execution and scale.

22 That's different than one of the key

23 success factors of Tesla, which is to have created

24 IP and unique technology that no one in the world

25 history had ever successfully commercialized and

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1 deployed.2 In fact, when we started on the auto side,3 folks said, not possible. And companies that were4 larger and entities that had similar attempts5 failed, where Tesla ended up succeeding.6 So the synergy that you asked me to --7 what I was referencing included the ability to8 productize and commercialize unique technology in a9 transformative way.

10 Q. Okay. Again, Mr. Chesler laughed at me,11 but I guess I'm too simplistic. I don't know what12 those words mean.13 So is there -- was there some desire to14 build new solar panels apart from the Solar Roof as15 part of the acquisition?16 A. Absolutely it was part of the discussion17 to have vertical integration in addition to having18 the opportunity to have third-party procurement on19 what you're describing as the core business.20 Q. But that didn't exist at the time, so that21 would have had to be something that was created at22 Tesla. There was not vertical integration beyond23 what was happening at Silevo; correct?24 A. I think you're now picking up on what I'm25 describing as synergy, which is not synergy in the

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1 traditional financial modeling form, but the synergy2 of taking a value proposition of a company that3 knows how to commercialize, that has had historic4 success commercializing and taking technology that5 others haven't been as successful and not done so6 within a period of time that Tesla did, and taking7 that asset and actually creating the synergy of the8 experience and success and engineering prowess that9 Tesla has that SolarCity did not.

10 Q. So when Elon Musk was proclaiming that the11 acquisition of SolarCity was going to result in12 synergies between 2- and $500 million -- do you13 recall him saying that publicly?14 A. I don't recall what Elon said about15 synergies per se publicly.16 Q. Well, did you have a calculation of what17 the potential synergies were under -- I guess18 using -- under the traditional financial synergies?19 As opposed to the kind of synergies that you were20 talking about, which I don't think you can model.21 Is that a fair statement?22 A. Right, so I think you have now hit the23 nail on the head, which is, there's financial24 synergies that are much more conventional, that are25 traditional metrics of how you might describe a

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1 synergy.

2 And what you're asking about is those

3 conventional synergies. And those were modeled, and

4 modeled by Evercore. I would have to go back to the

5 presentation to get the precise dollars.

6 But what I recall is that they were

7 modeled on the expense side, but not on the revenue

8 side. And as a result, on the Tesla side, we

9 thought there was additional opportunity for synergy

10 beyond what was financially modeled, in that,

11 putting the SolarCity product within a broader suite

12 of energy products that included the car and our

13 storage side could end up having revenue synergy

14 that wasn't even modeled.

15 Beyond that, the synergy that I was

16 describing, as we had this back-and-forth, was a

17 separate synergy, itself also not modeled and itself

18 with the opportunity to have perhaps the largest

19 value, when we historically look back at this,

20 around what the assets were that Tesla now owns.

21 Q. Did you utilize this other form of

22 synergies that's not modeled in determining what the

23 fair price was?

24 A. Yeah, in our mind, we ended up paying a

25 fair price without having to model the expense --

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1 the revenue side of synergy and without having to2 model actually what would happen if the Solar Roof3 were successful. My recollection is that in the4 Evercore model, they didn't actually model a DCF or5 an outcome based on success of Solar Roof; it was,6 rather, model as a continuation of the core7 business.8 Q. Just so I have your definitions right, by9 expense synergies -- what did you guys consider to

10 be the expense synergies that were available?11 A. To the extent that there was duplicative12 organizational roles, perhaps real estate roles, the13 typical conventional synergies when you merge two14 entities and have duplication, where the combination15 of the two can create a more streamlined expense16 structure than if two companies were operating17 separately and needed to have two sets of systems18 and people and a footprint.19 Q. So in this case, it would be you don't20 need two CFOs, you don't need to have a separate21 office for SolarCity? Those are the expense22 synergies you were talking about?23 A. Those are examples.24 Q. And then what were the revenue synergies?25 Give me examples of revenue synergies.

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1 A. Revenue synergies classic in many IPOs --2 Q. I would like you to focus on this one.3 What kind of revenue synergies were you4 thinking that were not modeled, but you thought5 existed?6 A. That's what I was answering.7 Q. You said, "in many IPOs," so I thought you8 were going to tell us the world of revenue9 synergies.

10 A. I actually I didn't say, "in many IPOs."11 In any event, you asked me about revenue12 synergy. And revenue synergies are when you take13 one company's product and you take what kind of14 revenue they would have done had they remained a15 separate entity, acquire that company. And within16 the context of the additional combined resources,17 one can have additional revenue opportunities as a18 result of selling additional products, leveraging19 assets that the acquiring company has.20 Q. So explain to me what that means at Tesla.21 A. Well, I would go back to the original,22 again, vision of Tesla to be a vertically integrated23 company. Instead of viewing the car as an isolated24 product, because it's an electric car, we actually25 think about additional components to what it means

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1 beyond just the wheels driving along the road.2 If one is going to be powered not by3 fossil, but rather by renewable, instead of viewing4 the car as potentially shifting the point of fossil5 consumption, we need to actually think about where6 that energy is generated from.7 And solar becomes a component that, for8 the customer. They can get a car that is green and9 they can buy solar that is producing that energy

10 that's green. And then between, you need a storage11 solution, which Tesla had, to actually store the12 energy that is being produced at certain times of13 day so that it can be used at the time that the end14 product, in this case potentially a car or home,15 wants to use that energy.16 Q. Okay. So the idea that one person will17 buy a Tesla, a Powerwall and a solar system at their18 house is a revenue synergy, in your mind?19 A. Yeah. I say it the same way that -- when20 I think about consumers buying on Amazon. They're21 no longer just buying books, but by having multiple22 products, what's known as a CAC, a customer23 acquisition cost, ends up getting leveraged across24 multiple products.25 The only difference here relative to an

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1 Amazon-like example is that the integration of the

2 products we're talking about here are far more

3 related than potentially buying a book on Amazon and

4 potentially a T-shirt.

5 Q. So other than that revenue synergy meaning

6 the person will buy -- an individual customer will

7 buy both a Tesla solar system and a Powerwall,

8 anything else?

9 A. That is what I mean. What -- the

10 customers would be buying more under an umbrella of

11 a Tesla than they might if they were buying -- if it

12 were just at SolarCity.

13 And to reiterate, I believe any of those

14 synergies were upside to the model that Evercore had

15 given to the board. And -- I'll reiterate again --

16 and the synergy of what Tesla brought to the table

17 in terms of commercializing a transformative product

18 was also upside to what was modeled.

19 Q. So nobody placed a number or some analysis

20 to this concept of revenue synergy; it was just what

21 you thought might -- could occur?

22 A. Right. What we wanted to focus on is if

23 we took out -- we wanted to make sure we were paying

24 a fair price absent this, and that we accomplished.

25 Q. But you did actually include into your

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1 value what you called expense synergies; correct?2 A. Yes.3 Q. And how was that modeled? Was that4 modeled by a Tesla executive or by Evercore?5 A. I know we got a presentation from Evercore6 modeling what they thought. And I'd have to --7 whether or not Tesla did its own -- I know that8 Tesla, at some point during this, obviously spent9 its own time thinking about synergies as well, but I

10 don't recall the dates.11 Q. We might get back to that in a moment.12 Do you remember what the biggest component13 of the synergies that you decided on the -- what you14 called expense synergies was?15 A. I would have to go back to the underlying16 details to refresh.17 Q. Now going on to the Solar Roof.18 Now, the Solar Roof -- were you aware that19 the Solar Roof was being viewed, at least from Elon20 Musk's perspective, as an incentive to try to get21 shareholders of Tesla to approve the transaction?22 A. I can't say what Elon thought. I can say23 more broadly that I think helping the shareholders24 understand the value of the transformative aspect of25 the Solar Roof was something that we all thought was

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1 important.2 Q. Well, are you aware of whether Elon Musk3 moved up the demonstration of the Solar Roofs for4 the purposes of getting shareholder approval of the5 transaction?6 MR. CHESLER: Objection to the form.7 THE WITNESS: I can't recall that the date was8 moved up, and I can't speak to the purpose without9 looking back at documents or seeing if I was aware

10 then.11 BY MR. BARON:12 Q. Okay. So you don't know whether or not --13 and from the board's perspective, the14 demonstration -- I'm not sure I understand that15 question.16 Did you know that the demonstration was17 moved up to happen before the shareholder vote?18 A. I knew that it did happen before the19 shareholder vote.20 Q. Did you know that it wasn't originally21 scheduled to happen before the shareholder vote?22 A. I can't recall if there was an original23 date and I knew the original date.24 Q. Do you know whether or not -- was the25 board getting any information as to what the

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1 institutional investors were thinking about the2 acquisition of SolarCity?3 A. Yeah. You mean between the time of4 approving the transaction and when the transaction5 was done, where it was approved?6 Q. The signing of getting shareholder -- the7 signing of the merger agreement and getting8 shareholder approval.9 A. So if you're asking between the time that

10 the board signed the merger agreement, which the11 board made contingent upon shareholder approval --12 if you're asking whether the board actually had any13 input as to what was going on with shareholder14 approval between that date and the date at which it15 was approved, the answer is yes.16 Q. I'm asking, were you getting feedback as17 to what institutional shareholders thought about the18 merger?19 A. At different points in time, we got20 various levels of feedback.21 Q. Who told you about that?22 A. Usually that kind of feedback would have23 been given by Todd Maron, but I can't recall24 specifically.25 Q. And did anybody tell the board that Elon

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1 Musk, in response to negative feedback he was2 getting from institutional investors, wanted to move3 up the Solar Roof presentation?4 MR. CHESLER: Objection to the form.5 THE WITNESS: I still can't recall specifically6 about the rationale for moving it up or not.7 BY MR. BARON:8 Q. I'm not asking whether you knew the9 rationale.

10 I'm just asking whether anybody ever told11 you that that was the rationale.12 A. I'm saying that. I don't recall, A, that13 it was moved up; and, B, if it was, what the reason14 was.15 Q. Now, did you have reason to believe that16 the Solar Roof -- that there was already sufficient17 understanding that the Solar Roof could be the18 things that you just said, which would look better,19 work better and be cheaper than solar panels?20 A. Can you clarify what you're asking. Are21 you asking whether I thought that they were that at22 the time?23 Q. That they had any reason to believe that24 they could actually achieve those at the time that25 you bought the company.

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1 A. Yes, I believed that within Tesla's2 ability to commercialize products, with its3 engineering prowess, and with its ability to4 actually take products to scale, that this, in fact,5 absolutely could be achieved.6 Q. But was there any reason to believe that7 at SolarCity, at the time, they had the ability to8 achieve a better looking, stronger and cheaper9 product, which is what Elon Musk kept saying

10 Solar Roof would be?11 A. Again, what -- I'm reiterating that I12 wasn't evaluating it, whether or not it was that at13 SolarCity. I was evaluating whether it would be14 that at Tesla.15 Q. So if SolarCity -- SolarCity finance had16 zero visibility on how much it was going to cost to17 make a Solar Roof, install it, R&D, where it will be18 manufactured, buildup costs of getting raw19 materials, et cetera, that wouldn't be a surprise to20 you?21 A. What I would say is all those -- if22 SolarCity didn't have any idea about any of those23 things -- which I don't know that to be the case,24 but if that were the case, it would be further25 evidence that the asset inside Tesla would be valued

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1 far more than it could ever be valued inside2 SolarCity. Because Tesla actually would have3 experience around many of those things.4 MR. BARON: Let's mark this.5 (Ehrenpreis Exhibit 8 was marked.)6 BY MR. BARON:7 Q. Showing you a document that's dated8 November 17th, 2016, so this is just after the close9 of -- and if you take a look down to the fourth

10 bullet point, do you see where it says, "SolarCity11 Finance has zero visibility on how much it is going12 to cost to make a Solar Roof, install it, R&D, where13 it will be manufactured, buildup costs, et cetera"?14 Do you see that?15 A. Yes. But can you clarify something. You16 were referencing a date. It says November 17th.17 You said it was a day after. Is that the day18 after --19 Q. It was shortly after.20 A. Shortly after the shareholders approved21 the transaction?22 Q. Yeah. It was closed on November 17th, so23 it's the same day.24 A. Okay. So you're asking me do I see --25 Q. And I just wanted -- so you understood

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1 where I was coming from, that information about the2 Solar Roof, did the Tesla board have an3 understanding that, at least from a SolarCity4 perspective, they didn't know how much it was going5 to cost, they didn't know how it was going to be6 installed, the R&D -- all of those factors, that was7 unknown to SolarCity?8 Were you aware of that?9 MR. CHESLER: Objection to the form of the

10 question.11 THE WITNESS: So this is consistent with my12 view that SolarCity, A, didn't have experience13 taking a product that was unique IP and figure out14 how to scale that unique IP over time, which clearly15 has -- if one has no experience in that, then one16 would presume that they don't have a lot of17 visibility as to how they are going to do that.18 And so it's consistent with my view that19 this is actually, in fact, the asset that, inside20 Tesla, would be worth more to Tesla, given the21 experience Tesla does have on things like how much22 it's going to take to scale a technology engineering23 effort, how much it's going to take to scale24 manufacturing and the like.25 BY MR. BARON:

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1 Q. My question was really simple.2 It was, you didn't know that, but it3 didn't matter to you; is that fair?4 MR. CHESLER: Objection to the form.5 BY MR. BARON:6 Q. That was all my question is.7 All of this information about what was8 zero visibility on the part of SolarCity you did not9 know as a Tesla board member; correct?

10 MR. CHESLER: Objection to the form.11 THE WITNESS: I don't know that I would -- I12 would say this is not some new revelation, that the13 SolarCity finance group does not know how to scale14 its product that doesn't exist. So perhaps the15 issue is zero visibility, and maybe that's extreme.16 But the notion that it does not have the17 kind of visibility to scale up this product long18 haul is not a surprising fact.19 BY MR. BARON:20 Q. And was not a fact that you can -- that21 was a factor that you considered one way or the22 other in your analysis of whether to buy the23 company; correct?24 A. No, it was. I'll try and say it a25 different way.

Page 155

1 It was a factor that the fact that2 SolarCity did not have the experience in scaling an3 IP initiative and scaling a technology initiative,4 like the Solar Roof, historically and doing it of5 the kind of size and scale like what Tesla has6 achieved in its core products -- I referenced the7 cars. I should also reference the storage side.8 On the storage side, as Tesla has built9 its Gigafactory, it has done so as the largest

10 battery manufacturing plant in the world. So the11 ability to put a technology inside of an entity that12 has the kind of experience that Tesla had and13 SolarCity didn't have was, in fact, the opposite of14 what your question assumed, which is -- the question15 was that we didn't factor that in or I didn't factor16 it in.17 It actually was factored in for me. It18 was factored in that, number one, it wasn't modeled19 by the bankers in their analysis, but, more20 importantly, from a Tesla value creation standpoint21 over time and the kind of growth that Tesla could22 have over time, the notion of having a23 transformative product was very compelling.24 Q. So did you have an understanding as to25 when you thought that product was going to be able

Page 156

1 to be marketed to third-party consumers?2 A. It's really tough in building technologies3 and building IP and scaling a company to figure out4 precise time.5 What I can tell you is that no one in6 world history to date, and still today, has ever7 achieved a product that is a Solar Roof that costs8 the same as a roof. And no one has ever built a9 Solar Roof to date that actually looks nice.

10 And so from where I sit today, I look back11 and say, I knew it was going to be a technology12 initiative. By the way, notwithstanding all the13 success Tesla has had that I referenced on its14 automobile and its storage side, I knew from that15 experience that things likely take longer and, in16 fact --17 Q. None of this was my question. You give me18 like three-page answers, and the question was19 simply, did you have a time period in which you20 thought the Solar Roof would be going to third21 parties?22 The answer is yes or no, you didn't.23 And then the question behind that is,24 okay, did you have a time?25 And the answer is, yes, I did or, no, I

Page 157

1 didn't.2 MR. CHESLER: I object to the lecture.3 You answer the question how you believe4 under oath you should answer the question.5 BY MR. BARON:6 Q. I'm going to ask you again.7 Did you have a time by which you believed,8 at the time you purchased SolarCity, that you9 believed that the Solar Roof would be able to be

10 marketed to third-party consumers?11 A. I'll answer it the same way.12 What I would say is having experience13 investing in technology and having experience14 watching Tesla and seeing the way -- what time meant15 in terms of product development, that I could not16 somehow say with specificity what the specific time17 line was, but, in fact, I knew that it would be18 faster under Tesla than it would be under SolarCity.19 Q. Okay. So you had no time period in20 particular that you could point to.21 A. I didn't say no time period.22 Q. Tell me -- when was the latest that you23 thought that this was going to be able to be -- to24 third party -- at the time you decided to buy it,25 what was the latest date in which you thought it was

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1 going to be?

2 A. One projects a latest date when they know

3 how the IP is going to be unfold. So I have not

4 been part of a technology initiative where one can

5 project a latest date.

6 Q. Did Elon Musk tell people when he said it

7 was going to be marketed?

8 A. I can't remember what Elon's timing is.

9 What I can tell you is Elon has often been

10 optimistic on timing. And that was something we

11 knew going into it as board members, but the issue

12 wasn't, in my mind, what the specific timing was; it

13 was whether or not we would ultimately be successful

14 in commercializing it.

15 Q. Did you have any data at all that gave you

16 the ability to predict a certain time period by

17 which the Solar Roof would be marketed and be better

18 looking, stronger and cheaper?


20 THE WITNESS: I've already answered that I

21 didn't have a specific and certain timing, but had a

22 viewpoint around both probability of success as well

23 as timing of success vis-a-vis being under the Tesla

24 umbrella.

25 BY MR. BARON:

Page 159

1 Q. Okay. So tell me when you thought it was2 going to be able to be marketed.3 A. I just said I couldn't do a specific time.4 Q. Could you give me within a year period, a5 two-year period?6 A. Giving a timeline presupposes you know the7 outcome to product development.8 Q. And you did not know that?9 A. One doesn't know with certainty what the

10 outcome of product development is in advance of a11 product development initiative.12 Q. Then how was it that Elon Musk was able to13 give a date?14 A. Elon has often given target dates that --15 he's actually said publically many, many times that16 he's often optimistic as to timing, but at least --17 I can't remember his wording, but at least my own18 editorial will be based on my experience in having19 watched the Roadster.20 If I were to look at the variance of the21 Roadster timing statements relative to coming out,22 probably delayed. Did it happen? Absolutely. Did23 it turn out to be of material value? Yes. If I did24 the same analysis on the Model S, I could point to25 the same fact pattern unfold. I could point to the

Page 160

1 same fact pattern on the Model X, and I could2 similarly point to the same fact pattern on Model 3.3 And so what Elon is forecasting and4 pushing the team to is a separate question to, in my5 mind, do I have a certain date. And, in fact, it's6 that aggressive timing that has led to the success7 of Tesla's product development efforts over time.8 Q. So the question that I asked you is --9 I'll ask it this way: As far as you are aware, was

10 Elon Musk in possession of some data different than11 the data you were that enabled him to give a12 specific date in which he believed the Solar Roof13 would be marketed to third parties?14 A. You would have to ask Elon.15 Q. You are a board member and the person in16 charge of the acquisition.17 Do you believe that Elon Musk had data18 separate and apart from what you as a board member19 had regarding the date of when the Solar Roof would20 be ready for production for third parties?21 MR. CHESLER: Objection to the form of the22 question.23 THE WITNESS: It wouldn't surprise me if Elon,24 for this, had all kinds of data that the board25 didn't have around the product development

Page 161

1 initiative.2 BY MR. BARON:3 Q. Why?4 A. Because he's part of the actual product5 development effort. So the underlying details6 around product development are ones typically done7 by a product development person at a company.8 And while the conclusions roll up to the9 board, you asked me if we had the same data as a

10 product development head. And the answer to that11 typically in a company is no. Whereas, the general12 conclusions for that product development effort are13 typically things that go to a board.14 Q. At the time of the acquisition, were you15 aware of there being any issues about the Solar Roof16 getting the kind of regulatory approval necessary by17 local fire departments, local cities and being able18 to deploy a Solar Roof? Were you aware of any of19 those issues?20 A. At a high level, of course.21 Q. What were you aware of?22 A. That there needed to be regulatory23 approval.24 Q. And were you aware of any efforts that25 were being made -- because this is -- this would not

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1 necessarily be technological initiatives. This2 would be some form of legal or compliance.3 What was -- what efforts were being made4 at SolarCity to achieve the regulatory compliance5 that they needed?6 MR. CHESLER: Objection to the form.7 THE WITNESS: I'll do my best to give you at8 least what I was thinking at the time.9 Much like every one of our cars that

10 required regulatory approval from the Department of11 Transportation, one did not actually go and deal12 with the regulatory approval and the crash tests13 until you actually made it through a certain product14 development stage.15 So the notion that somehow we were -- that16 the company ought to be pursuing a regulatory path17 before, in fact, it had a product that was fully18 developed would have been out of order.19 BY MR. BARON:20 Q. So you don't know whether they were trying21 to work with regulators or doing anything in order22 to achieve regulatory compliance.23 A. Yeah, at the time, that was, in my mind,24 premature relative to where they were in product25 development, at least in terms of the board getting

Page 163

1 an understanding of that.2 Q. Do you know -- are there any efforts3 currently being made to get regulatory approval for4 the Solar Roofs?5 A. I would have to ask the solar team as to6 where it is right now in terms of regulatory.7 Q. So you don't particularly know.8 A. No.9 Q. And do you know -- are you aware of there

10 being any fire code issues with the regulatory [sic]11 roof at all?12 A. Can you be specific?13 Q. No.14 Anything to do with fire codes, are you15 aware of whether there are any fire code issues with16 the development of the roof?17 MR. CHESLER: Objection to the form of the18 question.19 THE WITNESS: I don't know what you're20 referring to.21 BY MR. BARON:22 Q. So that doesn't ring a bell of any fire23 code issues that you can think of?24 A. Right now they're going through product25 development, so we have not gotten a regulatory

Page 164

1 update.2 Q. Do you have any understanding of whether3 or not any regulatory agencies or any associations4 associated with environment have been spoken to5 regarding getting regulatory approval for the Solar6 Roofs?7 A. I have no knowledge.8 Q. Do you have any knowledge about whether or9 not Solar Roofs have been decided to bring in

10 certain markets or not bring in certain markets11 because of regulatory issues?12 MR. CHESLER: Objection to the form of the13 question.14 THE WITNESS: Can you be more specific.15 BY MR. BARON:16 Q. To work on developing certain markets,17 certain states or certain communities, or not do so18 because of regulatory issues.19 A. At a high level, I know that there's been20 a discussion around the prioritization and21 segmentation of the market, but not as it relates to22 the question you're asking, that I have knowledge23 of.24 Q. Do you know whether or not -- there's25 often two ways to deal with regulatory issues. One

Page 165

1 is to try to make the product compliant with the2 regulatory regime, and the other would be to try to3 change the regulatory regime.4 Would you agree with that?5 And so by example -- for example, Uber's6 method was, let's go into a market and then we can7 see whether or not we can -- and once we're there,8 lobby the government to allow us to be there.9 Right.

10 Are you aware of Uber doing that kind of11 thing?12 A. I think it's more complex than that.13 Q. But they're not -- they are trying to14 change the regulations in certain markets that15 they're there in.16 You understand that; right?17 A. I understand that their business model18 requires a regulatory focus.19 Q. The question is -- there's two ways to do20 the roof; right? You can actually build a roof that21 is compliant with current fire codes or you can go22 and lobby the various regulatory agencies and see if23 you can alter the fire code to that the roof could24 be compliant; correct?25 MR. CHESLER: Objection to form.

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1 BY MR. BARON:2 Q. Those are two options.3 A. Those are two options.4 Q. Do you know whether either of those two5 options is the methodology chosen to be -- A, was6 the methodology that SolarCity was using or, B, is7 the methodology that Tesla plans to use?8 MR. CHESLER: Objection as to form.9 THE WITNESS: On the first question, I have no

10 knowledge of SolarCity's ultimate commercialization11 plans because I was focused on what we would do at12 Tesla, number one.13 And number two, the kind of -- ultimately14 the product rollout prioritization is one that has15 not been discussed to date with the board.16 BY MR. BARON:17 Q. Okay.18 A. In terms of timing and segmentation.19 Q. All right. Prior to the close -- post20 signing of the merger agreement, but prior to the21 close of the acquisition, were you aware of what22 financing plans or funding plans there were going to23 be for SolarCity?24 A. Can you repeat that.25 Q. Sure.

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1 Was the board of directors given a funding2 plan by the Tesla finance post merger at the time3 period between signing the merger agreement and the4 deal closing?5 A. So to clarify your question, was the Tesla6 board given a financing plan for Tesla -- for7 SolarCity over what period?8 Q. So between the signing of the merger9 agreement and the close.

10 A. I would have to go back and look at docs11 to actually refresh.12 Q. Well, let me show you a document, and why13 don't you tell me if you've ever seen this.14 MR. BARON: Can I have the October 7th.15 No. 9.16 (Ehrenpreis Exhibit 9 was marked.)17 BY MR. BARON:18 Q. Showing you what's been marked as19 Exhibit 9, top is a cover e-mail dated October 7th20 from Eric Senay --21 Do you know who that is?22 A. No.23 Q. -- to Jeffrey Evanson.24 Do you know who that is?25 A. I do.

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1 Q. Who is Jeffrey Evanson?2 A. Investor relations at the time.3 Q. And Eric Senay is corporate treasury? But4 you don't you know who that is?5 A. I haven't worked with Eric close enough.6 Q. If you go to the next page, it says,7 "Funding Plan Post Merger." It says, "Finance" and8 it's September 28th, 2016.9 And just to refresh your recollection,

10 the -- and acquisition closed on November 17th,11 2016.12 A. I'm just trying to see what document this13 is for a moment.14 Q. That's fine. Because that's my next15 question: Have you ever seen it before?16 A. I have not. Or at least this e-mail. I17 don't know if I've seen this document in a separate18 context other than this e-mail, but I've never seen19 this e-mail.20 Q. I'm now asking about the presentation21 itself.22 Have you ever seen the presentation or23 anything that looks like this presentation?24 A. I can't recall.25 Q. On this presentation, it specifically

Page 169

1 talks about there being a half-a-billion-dollar2 capital infusion into SolarCity to de-lever and3 de-risk the credit profile.4 Do you see that?5 A. Can I take one second and just get myself6 some context here? Looks like this is from7 October 7th.8 Q. If you look at the date of the plan9 itself, it says, 9/28, but the e-mail is --

10 A. Okay. So this is as of September 28th.11 (Witness reviews document.)12 A. Not sure what it's referring to on the13 third paragraph. It's references an "RA deck."14 Do you know what that means?15 Q. You're talking about the first e-mail?16 A. Just talking about the -- it references an17 "RA deck."18 What is "RA"?19 Q. I don't know.20 A. I still am not sure of the context.21 Q. The question -- that's fine.22 If you go to -- and it's the Tesla page23 38957, so it's really the second page of the24 presentation.25 Do you see where it says that it plans on

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1 there being a "Capital infusion into SolarCity to2 de-lever and de-risk the credit profile"?3 Do you see that?4 A. Yes.5 Q. Is that something that you were aware of,6 being part of a post-merger funding plan prior to7 the close of the merger?8 A. I would have to go back to the financial9 docs that I was presented with to see how this

10 reconciled with it.11 Q. Again, I think your testimony was that the12 way you looked at it was as a combined company, so13 this would be sort of part of the plan going forward14 for the combined company; correct?15 A. I can't say that to be the case. I can16 say that this document was -- looks like an attempt17 on September 28th to do what was described as, in18 the context of numbers, moving some revisions, a19 high-level walk. So I can't say without looking at20 the documents I got how this reconciled with these21 numbers.22 Q. Do you know whether or not there was a23 $.5 billion capital infusion to SolarCity after the24 acquisition?25 A. Again, after the acquisition, I don't know

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1 that I would have looked at it as a capital infusion2 into SolarCity, since, if after the acquisition, it3 would have been Tesla.4 Q. I think you called it a SolarCity core5 business. So while it may have been an asset of6 Tesla, do you know whether or not there was a7 transfer of $5 billion [sic] into the core asset to,8 quote, de-lever and de-risk the credit profile of9 SolarCity?

10 A. I would -- without looking, I can't say11 with certainty, but I can tell you that I can't12 recall at any point in time, whether there was a13 $5 billion --14 Q. I'm sorry. .5 billion. I misspoke.15 A. Okay.16 Q. Do you know whether there was a17 $500 million capital infusion into this SolarCity18 subsidiary?19 A. Your question presupposes that we operated20 that as a subsidiary at the time. And I don't21 recall whether we operated as a subsidiary then or22 at that point in time it was part of a consolidated.23 Q. So is it currently being operated as a24 subsidiary or a consolidated?25 A. I think of it as consolidated.

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1 Q. You think of it that way, but do you2 know --3 A. It's consolidated --4 (Reporter interruption.)5 Q. Do you know -- yes, you can still6 consolidate the financials, but it could still be7 operated as a subsidiary.8 That is possible; right?9 A. Yes.

10 Q. Is it being operated as a subsidiary? Is11 there still somebody in charge of the business unit12 at SolarCity?13 A. That's a separate question than whether or14 not it's a subsidiary, as to whether or not someone15 is in charge. In fact, when -- in most of my16 companies, where you have multiple product lines,17 where you have a single consolidated business, you18 have someone in charge. And that is the case at19 Tesla.20 Q. So there's not a separate subsidiary;21 you're sure about that.22 A. I don't believe there is a subsidiary23 right now.24 Q. Is there a separate business unit for25 SolarCity?

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1 A. At this point in time, it is -- there is a2 separate -- there is a solar component, but it's far3 more integrated with storage as well. And so I4 think the bright lines that you're trying to draw5 here -- I look at it, as a board member, as now it6 is an asset inside a broader company's portfolio.7 Q. So at the time when this document was8 drafted, if you go to the next page, which is 38958,9 the discussion of $500 million capital infusion into

10 SolarCity subsidiary is based upon a premise of11 SolarCity being a subsidiary that you don't believe12 existed at the time?13 MR. CHESLER: Objection to the form.14 THE WITNESS: I didn't say that. What I said15 was, I can't recall the timing of when the SolarCity16 asset migrated from what is being described in this17 document as a subsidiary into a consolidated set of18 financials.19 BY MR. BARON:20 Q. So was it a subsidiary at some point in21 time?22 A. I would have to go back and look at how it23 was characterized at the time of acquisition.24 Q. Was there ever a $.5 billion infusion into25 the SolarCity subsidiary?

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1 A. Again, I would have to go back into the2 board documents and the financials in order to3 refresh.4 Q. You don't recall ever being told that that5 would or would not happen?6 A. I do recall getting financials at each7 board meeting and at times in between, but if you're8 asking whether I recall this specific number at this9 specific time, the answer is I would have to go back

10 and look at the docs.11 Q. Do you know whether or not -- whether we12 call it a capital infusion into a subsidiary or13 otherwise, whether or not SolarCity utilized14 $.5 billion, or half a billion dollars, to buy back15 or de-leverage what were SolarCity financial16 instruments and to improve the SolarCity credit17 profile?18 MR. CHESLER: Objection to the form of the19 question.20 THE WITNESS: Again, you're asking me a21 question about improving SolarCity's profile, but22 this was inside of Tesla, at the time that you're23 presuming the question, even though this is a24 document that was described as essentially a work in25 progress at a time before the acquisition.

Page 175

1 So I have not seen this e-mail, and I2 can't recall whether I've even seen this document.3 And so if there were board documents that you can4 show me, I'm happy to try and refresh based on that.5 But I sure can't do it based on this person's e-mail6 to an IR person that they're describing as a work in7 progress at the time.8 BY MR. BARON:9 Q. Was Elon Musk receiving updates about the

10 discussions about how much to pay for SolarCity and11 input from the bankers and the lawyers before the12 board members received information?13 A. I have no knowledge of that.14 Q. So do you know whether or not before a15 presentation was given to you it was given to Elon16 first?17 A. You would have to ask him. I have no18 knowledge of that.19 Q. Would it surprise you or not?20 A. I would have to know more detail as to21 what he -- what -- the hypothesis that he was22 looking at or not to know if I was surprised.23 Q. What about just on recommending what the24 exchange rate was; do you know whether or not that25 was run through Elon before it was provided to the

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1 board?2 A. I only know about the deliberations that I3 was part of, not what happened with someone else4 outside of my deliberations.5 Q. Would it matter to you if Elon was having6 those conversations with the bankers and the lawyers7 before presenting that to the board?8 A. It would matter what the specifics were.9 Q. The specifics are that they were

10 discussing with him the exchange ratio before the11 board meeting. That's the specifics.12 Would that bother you one way or the13 other?14 A. Again, I would have to know what you mean15 by that. Do you mean they were discussing the fact16 that we were going to discuss an exchange ratio?17 Q. No, they were discussing the specific18 numbers of the exchange ratio.19 A. I would have to know what numbers are you20 be referencing.21 Q. So it would be okay if you discuss some22 numbers, but not others?23 A. No. As I said, it would perhaps make a24 difference if he was discussing the fact that there25 were going to be a conversation about the exchange

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1 ratio.2 Q. How about if the Evercore presentations3 were being vetted by Elon before they were being4 given to the board; would that be fine?5 MR. CHESLER: Objection to the form.6 THE WITNESS: It would matter the specifics and7 details.8 BY MR. BARON:9 Q. Okay. So it would just matter what

10 exchanged?11 MR. CHESLER: Objection as to form.12 THE WITNESS: You said that; I didn't.13 BY MR. BARON:14 Q. Do you know whether there were actually15 daily check-in calls between Elon and the investment16 bankers during the negotiations?17 A. You would have to ask Elon that.18 Q. Would it matter to you if that happened or19 not?20 A. Depends what the context is.21 Q. When you agreed to recommend the22 acquisition of SolarCity, were you of the view that23 it would be operated independently, or were you24 always of the view that it would be consolidated25 into Tesla as a whole?

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1 A. Having been on many boards, I didn't have2 a view as to what always would be. I had a view3 that when this integration would happen, that that4 could very well change over time based on how the5 company was operating. But I didn't have a view at6 the time to do as your question implied, that there7 would be an always way of operating.8 Q. Well, was it your belief that SolarCity9 could operate at a break-even cash flow sort of as

10 an independent subsidiary?11 MR. CHESLER: Objection as to form.12 THE WITNESS: You have to clarify your timing.13 BY MR. BARON:14 Q. At the time that you agreed to the merger15 agreement.16 A. I can't recall timing as to that question17 and whether or not -- at the time of approving the18 merger agreement.19 Q. How about at the time of close? At the20 time of close, were you of the opinion that21 SolarCity we want to be able to operate and break22 even on a cash flow basis on its own?23 A. I don't recall the timing of that24 specifically. What I recall is that, over time,25 what we elected to do was to aspire to do that.

Page 179

1 And, in fact, I know that the composition of those

2 cash flows changed based on trying to get more in

3 purchase than in leases.

4 Q. Did you have a belief, when you took over

5 SolarCity, that if you were to operate it

6 independently, that it could, absent a cash infusion

7 from Tesla or a cash infusion into the subsidiary,

8 operate on a break-even or positive-cash-flow basis?


10 THE WITNESS: Same answer. As I said, I can't

11 tell you, sitting here today, what the timing was

12 around some of my beliefs around that topic. At the

13 time of approving the acquisition, there were a

14 whole set of things we thought about in terms of the

15 value of the company. It wasn't an analysis of that

16 alone.

17 I can't remember when, over time, things

18 morphed into a thinking about, at least during a

19 certain period of time, trying to operate more cash

20 flow neutral.

21 MR. BARON: Why don't we take a quick break and

22 then we'll see if I can maybe finish up.

23 THE VIDEOGRAPHER: We're going off the record

24 at 2:05 p.m. and this is the end of Media Unit

25 No. 3.

Page 180

1 (Recess taken.)


3 2:13 p.m. and this is the beginning of Media Unit 4.

4 BY MR. BARON:

5 Q. Let's jump to a couple of the things that

6 I know you were presented with.

7 MR. BARON: Can you give me the February 29th,

8 2016 e-mail with Todd Maron and the presentation.


10 BY MR. BARON:

11 Q. Showing you what's been marked as

12 Exhibit 10. This is Project Icarus, which is a

13 presentation that was provided to the board of

14 directors from management about a potential

15 acquisition of SolarCity on February 29th, 2016;

16 correct?

17 A. Correct.

18 Q. Do you know how it got named Project

19 Icarus, by the way?

20 A. No idea.

21 Q. Do you know who Icarus is?

22 A. Greek mythology.

23 Q. Yeah, he was the guy who flew too close to

24 the sun and his wings melted and he came crashing to

25 the earth.

Page 181

1 Did you know that?2 MR. CHESLER: But did he have tiles on his roof3 at the time?4 MR. BARON: If he did, they wouldn't have5 broken.6 BY MR. BARON:7 Q. So when this was brought to the board,8 were you aware it was coming? Was there any9 indication -- not the -- I understand the

10 generalized -- there was discussion in the Master11 Plan Part 1 -- by the way, do you call it Part Deux12 or Part Two, the master plan?13 A. I have no idea. I probably use them14 interchangeably.15 Q. Okay. I don't know which one to call it,16 whether I'm supposed -- if I'm supposed to try to17 speak French or not.18 Anyway so Master Plan Part 1 I understand19 talked about the concept of solar, but as far as20 prior to this presentation, did you know there was21 going to be a suggestion by Elon Musk that you buy22 SolarCity at this time?23 MR. CHESLER: Objection to the form of the24 question.25 THE WITNESS: I don't recall that that was the

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1 purpose of the board meeting.2 BY MR. BARON:3 Q. What was the purpose -- it was a special4 board meeting.5 What was the purpose of calling a special6 meeting?7 A. To discuss the possibility of buying what8 is being proposed in this presentation as SolarCity.9 Q. Okay. Did you know -- when did you first

10 know that there was going to be a presentation of11 the potential for buying SolarCity?12 A. I can't recall when, if and when there13 was -- I had knowledge about that.14 Q. Did you know before you showed up to the15 meeting that that was the purpose of this special16 meeting?17 A. I just can't remember.18 Q. You didn't get an agenda or anything prior19 to this meeting; correct?20 A. I just can't remember.21 Q. Do you normally get agendas prior to a22 special meeting?23 A. No. This kind of e-mail would have been24 consistent with at least an update.25 Q. And Elon Musk at the time was chairman, so

Page 183

1 he had the ability to call a special meeting;2 correct?3 A. Sure.4 Q. Did anybody else have the authority to5 call a special meeting?6 A. You know, I would say that to the extent7 that board members wanted to talk collectively, that8 Elon wasn't the only one historically who had9 convening power.

10 Q. Really? Within the corporate governance11 board, any board member can convene a special12 meeting?13 A. No, I wasn't suggested that within the14 corporate governance bylaws. I was saying as a15 matter of practice, to the extent that there were16 board members who wanted to speak, I don't think17 Elon was the only one who could convene.18 Q. As far as authority within the company,19 could anybody convene a special meeting other than20 Elon?21 A. I don't believe so.22 Q. Now, do you recall -- did somebody make23 this presentation to you, or did someone just hand24 it to you guys?25 A. So no one handed it to us, because I'm

Page 184

1 pretty sure it was a call.

2 Q. Okay. So somebody e-mailed it?

3 A. So the e-mail looks like it was sent the

4 night before.

5 Q. Did somebody walk through this on your

6 telephone call?

7 A. I'm sure someone must have. I'm sure we

8 didn't just sit in silence on this.

9 Q. Who was it?

10 A. I can't recall. Let's see who was on the

11 call. It was probably a combination of Elon, Todd

12 and Jason, but I don't know that specifically. But

13 I'm just looking at the e-mail. It would not be

14 uncommon.

15 Q. And did anybody on the board have any

16 views at the outset before the presentation was

17 provided?

18 A. At the outset. So for -- I think there

19 were views around the idea of buying a solar company

20 or at least getting involved over time with a solar

21 company that dates back not to -- as you asked

22 earlier about the original master plan, but we had

23 had conversations historically about solar.

24 And then are you asking --

25 Q. I'm very simply asking, at this meeting,

Page 185

1 at this special meeting, before the presentation was2 made about this, was there anybody on the board who3 expressed a view one way or the other whether they4 thought that buying SolarCity made sense or didn't5 make sense, prior to the presentation?6 A. So that is what I was trying to answer,7 which is, historically there was a conversation8 around buying a solar company in general, as to what9 the pros and cons of that might be. But I don't

10 recall anyone going into this presentation with some11 preordained view.12 Q. Again, we're only talking about, dial in,13 everybody is on the call, and said, okay, we're14 going to give this presentation, and somebody piping15 up before the presentation and says, this isn't a16 good time to buy a company, this is a great time to17 buy a company.18 Did anybody say anything like that?19 A. No, not that I recall.20 Q. Okay. Do you know who at the company21 prepared this presentation?22 A. I don't know.23 Q. Do you recall there being a discussion on24 the slide of the accretion and dilution to EPS?25 A. The only thing that I recall in that

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Page 186

1 context is that folks felt that this presentation

2 was just so high level and not enough information to

3 really be able to deliberate --

4 Q. Well --

5 A. -- with any sufficient basis.

6 Q. Now, was accretion and dilution something

7 that -- at least for the purpose of deciding at this

8 stage whether to go forward and how fast, was that

9 actually a factor?

10 A. Are you talking about at this meeting?

11 Q. Yes.

12 A. I can't remember or recall with any detail

13 that somehow that was the line item that somehow got

14 folks -- where it drew attention per se. I remember

15 us trying -- this was a -- I don't know that it's

16 numbered here.

17 I remember noting that it was a nine-page

18 document and that it was very high level and there

19 just wasn't enough information in it to really have

20 a sufficient discussion around whether or not to

21 move forward.

22 MR. BARON: Can you mark this as 11.

23 BY MR. BARON:

24 Q. I just want you to see the minutes so you

25 can perhaps refresh yourself.

Page 187

1 (Ehrenpreis Exhibit 11 was marked.)2 BY MR. BARON:3 Q. I'm showing you the minutes. Have you4 seen these minutes before today? These are the5 February 29th minutes, the minutes for the special6 meeting that the presentation we've been talking7 about was provided.8 A. Yes, I just am reading it to remind myself9 of what the minutes said.

10 (Witness reviews document.)11 A. Okay.12 Q. So did this help refresh your recollection13 as to who made the presentation? It says14 Mr. Wheeler, but that may be just what it says and15 not refresh your recollection.16 A. It doesn't change what I said before,17 which is, I have no doubt, if this said Mr. Wheeler18 presented, that he did, but I, sitting here today,19 don't remember that it was him specifically. As I20 said, it could've been him.21 Q. And at the conclusion, this says that "The22 board decided not to proceed with an offer to23 SolarCity at this time because of the potential24 impact on management team's time and resources in25 the near term. In the meantime, the board

Page 188

1 authorized management to gather additional details2 and to further explore and analyze a potential3 transaction with SolarCity or other related4 businesses."5 Is that an accurate representation of what6 happened -- of what you decided?7 A. Yeah.8 Q. So in other words, maybe not yet, but get9 us more information. This was too high level for us

10 to go forward?11 A. Yes. And I'd say high level, need more12 information, and if we're going to look at13 SolarCity, we need to look at other related14 businesses also.15 Q. Okay. So other related businesses were16 other SolarCity companies -- or solar companies? I17 just want to know what you meant by "related."18 A. Yes, other solar companies.19 Q. Now, going back to the accretion/dilution,20 was there any discussion about accretion/dilution at21 all at the meeting other than this presentation?22 A. You know, I can't remember too much detail23 about what is here Slide -- the slide that says,24 "Accretion/Dilution," but I do remember that folks25 thought that this was way too high level, that

Page 189

1 clearly, looking back on it, it's hard to know what

2 the assumptions were and weren't and any detail

3 behind it.

4 Q. Were you troubled by the fact that if --

5 or was there any comment over the fact that if you

6 went with this acquisition, that it would be

7 anywhere between 69.5 percent dilutive in 2016 to

8 19.8 in 2018 without synergies and, with synergies,

9 it would be dilutive up to 43 or 9 percent dilutive?

10 Was there any discussion particularly

11 about, yeah, that's not necessarily good or bad to

12 be that dilutive?


14 THE WITNESS: What I remember is, again, it was

15 presented too high level. And accretion and

16 dilution to EPS is only one metric. And I don't

17 recall whether it was at this board meeting or

18 beyond, but other metrics, like accretion and

19 dilution to EBITDA, are perhaps equally, if not

20 more, important. And there wasn't an analysis done

21 on that.

22 BY MR. BARON:

23 Q. Okay. Do you know whether or not there

24 was ever additional analysis on accretion and

25 dilution to EPS?

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Page 190

1 A. I do recall that Evercore included that as

2 one of its components of analysis. In addition to

3 EPS, I do believe over time they did include an

4 EBITDA analysis.

5 Q. Did the analysis ever -- I know the

6 numbers were slightly adjusted, but did the analysis

7 ever determine -- or were you ever told that it

8 would be accretive instead of dilutive for -- on an

9 EPS basis?

10 A. I would have to go back and look at the

11 numbers. My recollection is it was quite positive

12 from an EBITDA perspective and negative under an EPS

13 perspective over the term that Evercore highlighted.

14 And I also recall us looking at this as a

15 long-term business and recognizing that, as I said

16 before, absent the revenue synergy and absent the

17 potential -- order of magnitude potential value on

18 Solar Roof, that even that analysis didn't include

19 it.

20 Q. Okay. Again -- and I got all that. I

21 just wanted to make sure that I didn't miss

22 anything.

23 I didn't see any presentation that showed,

24 on an earnings-per-share basis, that it was

25 accretive. And I wanted to make sure that you

Page 191

1 yourself had not seen some indication it was2 accretive on an earnings-per-share basis.3 A. Over what time are you referencing?4 Q. Prior to the -- your approving -- prior to5 signing the merger agreement.6 A. Sure. So at least to my recollection is7 that -- or my view is that talking about EPS at the8 time of acquisition is only looking at it at one9 point in time. And so what I've described before

10 clearly relates to a long-term value, which is not11 modeled in a 2016, '17, '18 alone.12 Q. And I don't think we need to actually13 debate this. I just want to make sure.14 I didn't see any documents that ever15 showed that in 2016, 2017 or 2018 that it was16 accretive on an EPS basis. And I wanted to see17 whether or not you're aware that some exist that I18 have somehow missed.19 A. I don't recall all the documents. What I20 do recall is ultimately seeing a document that21 described how accretive it was on a EBITDA basis.22 Q. Okay. Maybe we will get to that.23 Now, again, on a net cash basis, again,24 you were aware that, again, at this point on -- it25 showed that Icarus, which was SolarCity, was

Page 192

1 negative on a net cash flow basis for 2015 actual,

2 expected to be almost a half a billion dollars

3 negative at 2016 -- in 2016 and showed throughout

4 that they were going to be negative at least

5 through -- in 2016.

6 Was that discussed at all, again on a

7 high-level basis, as a reason to say no to this

8 acquisition at the time?


10 question.

11 THE WITNESS: I believe you're referencing

12 Slide 5.

13 BY MR. BARON:

14 Q. Yes.

15 A. And actually what Slide 5 shows,

16 although -- you talked about what the numbers show

17 for 2015 and 2016, but what it actually shows is

18 that Icarus would actually -- if one took these

19 numbers, would actually go positive --

20 Q. By 2017?

21 A. -- in 2017.

22 And it actually shows on this document

23 that the synergies, which include expense and

24 revenue, although I don't think over time the

25 revenue was modeled -- but would have been a synergy

Page 193

1 that would have been another hundred million in this2 document.3 And then it shows that the combined4 company would have actually delivered just shy of a5 billion dollars of net cash flow.6 Q. That wasn't my question.7 I'm just asking whether or not there was8 any reference or discussion over the negative cash9 flow numbers for 2015 actual and 2016 expected.

10 That's all I asked.11 A. Sure. And, again --12 Q. Do you agree with me that that's what this13 says, there were negative cash flow numbers for 201514 actual and 2016 estimate? Right?15 MR. CHESLER: Objection to the form and to the16 interruption of the witness.17 THE WITNESS: I can't recall this slide in18 particular, but I can say that it would be -- that19 it is not my standard practice to look at slides20 like this, that has three years, with the third year21 going positive, and focus on the first two years,22 since, in fact, like most investments, you tend to23 have an initial period of time that you're making an24 investment in something, and then you ultimately get25 a return over time. That's, in fact, the entire

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Page 194

1 premise for the venture industry.

2 And so when I look at this -- you're

3 asking me whether we focused in on 2015 and 2016,

4 and my answer is, I don't remember a lot of detail,

5 but I don't think it would have been a 2015 and 2016

6 discussion per se. It would likely have been a full

7 set of analysis.

8 But, either way, it was too high level to

9 have spent a lot of cycles on this.

10 BY MR. BARON:

11 Q. Going to page 7, again, there was on --

12 the income statement was showing that the net income

13 of SolarCity was going to be, again, negative actual

14 in 2015, negative in 2016, negative in 2017 and also

15 negative in 2018 here.

16 Was there a discussion over that?

17 A. I can't recall if it was at this meeting

18 or there being at different time. Because, again,

19 this was a number of years ago, so I don't remember

20 what happened at what meeting.

21 But clearly the idea of having a negative

22 income statement or gap net income is a function of

23 the business where, in fact -- unlike some

24 businesses which get paid in full up front, what we

25 did know about the solar industry in general, which

Page 195

1 would have included SolarCity, is that, at least for

2 on the lease side, which represented a significant

3 portion of the business, you don't get paid up

4 front, you get paid over a cycle.

5 So these net income numbers per se would

6 not have jumped out as being unusual if you're

7 looking at a solar business.

8 MR. BARON: Can I have May 31st board minutes,

9 please.

10 BY MR. BARON:

11 Q. You can put that document aside.


13 BY MR. BARON:

14 Q. Showing you the minutes of May 31st, 2016.

15 Do you recognize these minutes?

16 A. Yes. But I just would like to take a

17 minute to remember -- these looks like Tesla board

18 minutes.

19 Q. Yes. And they're regular meeting minutes,

20 too.

21 A. Yeah.

22 (Witness reviews document.)

23 A. Okay.

24 Q. Now, do you recall before going to this

25 meeting that there was going to be a renewed

Page 196

1 discussion of the acquisition of SolarCity?2 A. I guess I wouldn't describe it as renewed.3 There had been sort of this ongoing dialogue around4 solar. We then just went over what happened in5 February. I believe at some point in March, we also6 had a continued discussion about it. And then we7 ultimately -- in this May meeting, I would describe8 it more as continued to talk about it.9 Q. So it wasn't -- it wasn't a surprise that

10 talking about the acquisition of SolarCity was part11 of the agenda?12 A. No.13 Q. And, again, it's consistent with what we14 talked about in February where you said, we're not15 going to do it right at this time, but you should16 get more information and let's talk about it; right?17 A. Exactly.18 Q. And was there any discussion -- at the end19 of the special meeting, there was -- you're going to20 tell us about SolarCity and other potential solar21 companies.22 Was there any other discussion about other23 solar companies?24 A. There ultimately was a discussion about25 that. And there was clearly discussion --

Page 197

1 Q. At this meeting.

2 A. At this meeting? You know, it's hard for

3 me to remember specifically what the breakdown was

4 at different meetings, but in most of these

5 conversations, the idea was if we're going to

6 actually pursue this, then, in parallel, we want to

7 make sure we have the context of the other

8 companies.

9 Q. Did anybody say, is there anything going

10 on bad at SolarCity that makes us need to do this

11 now? Did anybody ask Elon that?

12 MR. CHESLER: Object to the form of the

13 question.

14 THE WITNESS: It presupposes that somehow there

15 was something bad going on and, B, that somehow the

16 board would have asked Elon about that.

17 BY MR. BARON:

18 Q. Well, you knew Elon was chairman of the

19 board of SolarCity; right?

20 A. What we would have done and did do is we

21 actually engaged the bankers to ultimately undertake

22 a process to get what was not public information.

23 Because at this point in time, we were only

24 evaluating what was public information.

25 Q. So the answer is no. These aren't --

50 (Pages 194 - 197)


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Page 198

1 they're not meant to be tricky questions.2 I'm asking the simple question: Did3 anybody at the board, when Elon brought it up in4 February and then brought it back up in May, say,5 hey, you, Elon Musk, chairman of the board of both6 this company and that company, is there something7 going on at SolarCity that is problematic that we're8 bailing them out for?9 Did anybody say that?

10 MR. CHESLER: Object to the form of the11 question.12 BY MR. BARON:13 Q. That's a yes-or-no question. I mean, I14 know you want to challenge the premise. It's a15 simple question, and we've been doing this all day16 and I'm probably get tired.17 The question is, did someone say, hey,18 Elon, you're the chairman of the board of SolarCity.19 Is something going on there that we should know20 about before we go into this process?21 MR. CHESLER: I object to the form of the22 question.23 You're not obligated to say yes or no24 because counsel would like it. Answer however you25 believe is necessary under --

Page 199

1 MR. BARON: Actually, he is required to be2 responsive --3 MR. CHESLER: No, he's not, Counsel. He's not4 obligated to answer it your way.5 MR. BARON: No, he's obligated to be6 responsive, so let's try that.7 MR. CHESLER: That's inappropriate. You are8 getting tired and you're also getting cranky.9 Just answer the question appropriately in

10 your own view.11 THE WITNESS: So, number one, I was being12 responsive to the question and gave my answer to13 that question.14 And number two, I'll also add that as it15 relates to the interaction with Elon, the board16 undertook a process to engage counsel around the17 process around asking Elon questions like the one18 you proposed.19 BY MR. BARON:20 Q. What does that mean?21 A. Whether or not asking Elon for his insight22 into being on -- as part of the SolarCity was the23 way we were going to undertake a diligence process.24 And we took the advice of counsel as to the process25 of diligencing the sub- -- underlying substantive

Page 200

1 element to the question you're asking me.2 Q. But the question is simple.3 Did anybody say, Elon, is there something4 going on that made you bring this to our attention5 regarding how SolarCity is doing?6 Did anybody ask that question?7 MR. CHESLER: Objection to the form of the8 question.9 THE WITNESS: Your question presupposes that

10 somehow Elon was bringing something to the board11 for -- and I think that, number one, it included a12 management team. As you rightly pointed out, it was13 Jason Wheeler who actually led the discussion in14 February. So it wasn't Elon per se.15 BY MR. BARON:16 Q. You're telling me that you think that this17 all started with Jason Wheeler?18 Who started -- whose idea was it? It was19 Elon's master plan that thought about solar in the20 first place.21 Are you telling me that you think somebody22 else in management said, hey, now is the time we23 should start thinking about buying SolarCity,24 someone other than Elon?25 MR. CHESLER: Objection as to form.

Page 201

1 THE WITNESS: Actually, this was a board2 decision and ultimately a shareholder decision.3 It's not --4 BY MR. BARON:5 Q. Somebody brought it to the board.6 A. And it's not --7 Q. Who brought it to the board?8 MR. CHESLER: Don't interrupt him.9 Finish your answer.

10 THE WITNESS: Ultimately it was a board11 deliberation, a board decision and a shareholder12 decision, not an Elon decision.13 BY MR. BARON:14 Q. Who brought it to the board?15 A. I don't think there was a specific single16 individual who brought it to the board. The17 management brought it to the board at a board18 meeting.19 Q. Who at management first thought of it?20 A. You would have to ask management.21 Q. You don't know as a board member. You22 don't know the that answer.23 A. I think you're trying to somehow24 distill --25 Q. No, I'm asking you a question. You don't

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Page 202

1 know that answer. No. You're saying what you think2 I'm trying to do. I'm asking you a direct question.3 You do not know who at the management team4 decided we should bring this to the board; correct?5 MR. CHESLER: Counsel, raising your voice and6 interrupting him is inappropriate. Please stop.7 Those are also Delaware rules, by the way.8 Go ahead. Answer the question.9 THE WITNESS: So when I think of how the

10 conversation got brought to the board, I view it as11 a continuation, by the way, of a conversation that12 the board had along the journey, including, by the13 way, 2015. There was a February 2015 meeting.14 So the notion that somehow Elon just15 popped up with this new idea is inconsistent with16 the facts as they unfolded.17 BY MR. BARON:18 Q. Whose idea was it to call the special19 meeting in February and present it to the board? Do20 you know that answer or not?21 A. I know that Elon called the special22 meeting.23 Q. Okay. Do you know whether or not it was24 Elon's idea as to what the purpose of the special25 meeting was?

Page 203

1 A. I think Elon knew the purpose of the2 special meeting, yes.3 Q. Okay. Do you know whether it originated4 from someone else at management other than Elon?5 A. I will say again I think it originated6 from a history of contemplating a solar business and7 ultimately Elon catalyzing a discussion at the8 February board meeting and then ultimately having a9 deliberation by the board in a number of meetings

10 thereafter.11 Q. Now, without presupposing it was brought12 by Elon or any other person, did anybody ask, hey,13 Elon, you, as chairman of the board of SolarCity,14 are you aware of something going on at SolarCity15 that would mean that they need to be bailed out by16 Tesla?17 Did anybody ask that question?18 MR. CHESLER: Objection to the form of the19 question.20 THE WITNESS: I'll answer it as best I'm able21 one more time, which is, as it relates to questions22 that we didn't ask Elon, that was a function of the23 discussion we had with counsel.24 BY MR. BARON:25 Q. I don't know what that means again.

Page 204

1 A. Okay. Well, we had discussions --

2 MR. CHESLER: Don't go into any substance of

3 discussions with --

4 THE WITNESS: We had discussions with counsel

5 as to what the board was going to be asking Elon or

6 not asking Elon.

7 BY MR. BARON:

8 Q. Well, that's interesting.

9 Again, without the substance -- were --

10 these conversations through your attorneys about

11 what you were or were not going to discuss with Elon

12 Musk, were those done at board minutes [sic] or were

13 those done outside of the board meeting -- I'm

14 sorry -- at board meetings or outside of the board

15 meeting?

16 MR. CHESLER: That's just a location question.

17 THE WITNESS: I know it included board

18 meeting -- well, I would have to go back and figure

19 out where, but I know that it was a function that

20 ultimately led to a recusal of Elon, is what I'm

21 really referencing. That is a matter of record,

22 that Elon recused himself, and it was a function of

23 discussions with the attorneys.

24 BY MR. BARON:

25 Q. Going back now to Exhibit 11.

Page 205

1 Again, was there some discussion through

2 attorneys that took place at this board meeting

3 regarding Elon's knowledge or lack of knowledge

4 about what was happening at SolarCity?

5 MR. CHESLER: You're referring to 11 now? Back

6 to February?

7 MR. BARON: Yes.

8 BY MR. BARON:

9 Q. I just want to know whether or not this

10 was the board meeting in which those conversations

11 took place.

12 A. Well, if you look on the Section 1, the

13 last sentence prior to the portion that's redacted,

14 it says, "Messrs. Maron and Sonsini reviewed the

15 legal process" --

16 Q. I understand.

17 A. -- "for the proposed acquisition and

18 potential timing considerations."

19 So all I'm describing is having actually

20 had Todd Maron, who is GC, and Larry Sonsini,

21 outside counsel, review the process. My statement

22 continues to be that, upon advice of counsel, we

23 were in some -- is one of the pieces of input we got

24 was around what we were actually asking Elon

25 himself.

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Page 206

1 Q. All right. Okay. That's the process and

2 I got that.

3 But as far as directly there being

4 questions to Elon about the status of SolarCity, is

5 that what is redacted from the board 11 minutes?

6 I don't want to know what was said or the

7 advice. I just want to know -- you're saying that

8 questions that were posed to Elon were posed through

9 lawyers.

10 Is that what you're saying?

11 MR. CHESLER: First of all, let me make clear,

12 you're not to talk about, if you know, whatever is

13 redacted from the document. That was redacted for

14 privilege.

15 MR. BARON: And I'm not asking that. I'm just

16 trying to understand what he's telling us. So let's

17 take it one step at a time.

18 BY MR. BARON:

19 Q. Are you saying that questions were posed

20 to Elon through lawyers as to what was happening at

21 SolarCity?

22 MR. CHESLER: That's a yes-or-no question.

23 THE WITNESS: Were questions posed by lawyers

24 to Elon about what's going on at SolarCity?

25 BY MR. BARON:

Page 207

1 Q. Were questions posed through lawyers as to2 what was going on at SolarCity?3 A. And, again, I continue to try and explain4 to you that we did not use -- that there was a5 process for, up until the offer was made, using6 publicly available information and based on publicly7 available financials. And that is what the board8 initially used as its set of information. We did9 not ask Elon a set -- well, I guess that goes into

10 the privilege. I'll leave it at that.11 Q. So the answer is, no, you did not ask Elon12 questions -- and we'll do it at a time because I13 think this is a yes-or-no again.14 Did you ask Elon questions on15 February 29th through your lawyers?16 A. I can't recall that we somehow asked Elon17 questions through lawyers at this particular18 meeting, nor do I suggest -- I don't think I believe19 I ever said we asked Elon questions through lawyers.20 So the notion that we were doing it at this board21 meeting presupposes that's what I said we did, which22 I did not.23 Q. On May 31st on Exhibit 12, did you ask any24 questions of Elon Musk through lawyers about25 whether -- let me do it in general because that way

Page 208

1 I won't do subject matter.

2 Did you ask any questions of Elon Musk

3 through the lawyers at the May 31st board meeting?

4 A. I can't recall specifically.

5 Q. Did you ask Elon Musk any questions

6 through lawyers at any time after the May 31st board

7 meeting?

8 A. Again, I was not suggesting that we asked

9 questions of Elon through lawyers. I was saying the

10 lawyers guided the process around what Elon was

11 going to contribute and what he wasn't and the

12 timing thereof.

13 Q. So now let's go back to my original

14 question.

15 On May 31st, did you ask Elon directly

16 whether or not he knew something about what was

17 happening at SolarCity that would be solved by an

18 acquisition by Tesla?


20 THE WITNESS: Well, your question suggests that

21 we would have asked him about whether Tesla was

22 solving something for SolarCity. Our deliberations

23 were all about the value that Tesla would derive

24 from buying SolarCity.

25 BY MR. BARON:

Page 209

1 Q. So the answer is, no, you did not ask him2 that.3 A. Not in the form you asked it.4 Q. Great.5 And on -- in Exhibit 11, on February 29th,6 did you ask Elon Musk directly, is there something7 going on at SolarCity that we should know about that8 we are therefore solving through the acquisition of9 SolarCity?

10 Did you ask that question?11 MR. CHESLER: Objection to the form.12 THE WITNESS: We didn't ask it the way you're13 positing the question.14 BY MR. BARON:15 Q. So let's move on to the next presentation16 that you got from -- on 6/20.17 MR. BARON: Can I have the 6/20 presentation by18 Evercore.19 (Ehrenpreis Exhibit 13 was marked.)20 BY MR. BARON:21 Q. I'm showing you what is a meeting agenda22 and a presentation for a board of directors23 discussion on June 20th, 2016.24 Do you recall being at this meeting and25 receiving this presentation from Evercore?

53 (Pages 206 - 209)


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Page 210

1 A. Yes.2 Q. What did you understand the purpose of3 this presentation to be for?4 A. To get Evercore's analysis of the5 transaction we were considering.6 Q. Now, was this based on public information7 or non-public information of SolarCity?8 A. My recollection is this was based on9 public information.

10 Q. And what was -- why was -- excuse me.11 What is your basis for that belief?12 A. That's my recollection.13 Q. Now, turning to page -- turning to page 4,14 which is the valuation summary.15 Do you see that there was a 10-year16 discounted cash flow analysis?17 A. I do.18 Q. Do you know what projections were used for19 that discounted cash flow analysis?20 A. I know I was told at the time. I can't21 recall, sitting here today, looking at this22 document.23 Q. Do you remember how they were created?24 A. I do recall they were based on the25 publicly available information at the time, but I

Page 211

1 can't tell you with more detail.2 Q. And moving forward -- move to page 7. And3 do you see -- on the accretion/dilution analysis on4 the pro forma income statement, do you see the5 adjusted EPS?6 A. I want to understand this in context.7 MR. CHESLER: That's page 7?8 MR. BARON: Yes.9 THE WITNESS: Yeah, I see that page 8 puts that

10 in context.11 BY MR. BARON:12 Q. Yep.13 A. And page 8 shows the EPS numbers here on14 the bottom that I think you're referencing and then15 shows significant accretion on EBITDA at the top.16 Q. I was going to get to that. You didn't17 have to fight for it.18 I'm just asking whether -- you recall the19 discussion; correct?20 A. My answer is, I recall it in the context21 of page 8 when we're talking about accretion and22 dilution which begins the set of metrics as opposed23 to -- I actually don't recall it here on page 7. I24 see it's there, but I don't recall it. I do recall25 a comparison of EBITDA and EPS.

Page 212

1 Q. So, again, we're still on page 7, which2 is -- you see that they discuss on page 7, on the3 pro forma income statement, that it would be4 dilutive first highly in 2017 and then going down5 towards 2020 to 14 percent, 14.6 percent.6 You just don't recall there being any7 discussion over that?8 A. You know, I don't recall specific pages.9 I'm trying to put this in context for you. So I

10 guess the numbers that you're referring to -- is11 this DCF here? I guess that would reconcile with12 rolling up here into page 4 on its discounted13 equity. And that rolls again to the assumptions14 here on page 7. I'm looking at the assumptions here15 in real time, but, again, this was all in context.16 Q. All I'm asking is whether you recall there17 any discussion about the accretion/dilution when you18 got to this page on the pro forma income statement?19 A. Again, I don't recall it on this20 particular page. I recall it in a broader context21 of discussion around accretion and dilution.22 Q. Now, again, I asked you last time whether23 or not you were aware of any other analyses that24 ever showed that at least accretion/dilution of the25 EPS became accretive. This shows that they still

Page 213

1 were analyzing it as being dilutive.2 Does this refresh your recollection as to3 whether or not Evercore or anyone else ever told you4 that the acquisition would actually be accretive on5 an EPS basis?6 MR. CHESLER: Objection to the form of the7 question.8 BY MR. BARON:9 Q. On an EPS basis. I understand we'll

10 talking about the EBITDA basis.11 On an EPS basis, did anybody ever tell you12 at any time that it was actually going to be13 accretive?14 A. The way we talked about it was that these15 were the pro forma assumptions on EPS. These were16 not what -- to somehow draw the link between these17 and other assumptions on EPS and not also reference18 what I have also previously described, which was the19 additional revenue accretion and -- or synergy as20 well as the potential Solar Roof synergy, is omitted21 from this financial modeling. And so, yes, we did22 talk about what the upsides were to financial23 modeling.24 Q. So moving on that, so this says that it's25 pro forma, including synergies. Your view is this

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1 was just cost synergies and had nothing to do with2 the revenue synergies or had nothing to do with3 Solar Roof; is that what you're saying?4 A. Well, I don't believe it had to do with5 any material Solar Roof value. And as I look at6 page 7, it is refreshing my recollection that it --7 that the key assumptions on the bottom of page 78 reference synergies around OpEx, but do not9 reference any synergy around revenue.

10 So given that these were based on11 SolarCity publicly available information, then there12 was not an additional assumption around what the13 revenue synergy would be inside of Tesla.14 Q. How were the synergies calculated for15 this? Do you recall?16 A. You have to ask -- go back --17 Q. Do you recall whether they were actually18 trying to determine what synergies existed or19 whether or not they were just talking about what20 synergies existed amongst other acquisitions and,21 therefore, figured the range applicable to other22 acquisitions would be applicable here?23 A. I would have to go back and refresh. I24 don't recall, sitting here today.25 Q. That wasn't discussed?

Page 215

1 A. I didn't say that. I said I don't recall.2 Q. So if you take a look at page 71 --3 actually, I'm sorry. About 70, we take a --4 MR. CHESLER: 70?5 MR. BARON: Yeah.6 (Witness reviews document.)7 BY MR. BARON:8 Q. Does this refresh your recollection as to9 how Evercore determined their synergies?

10 A. Not more than I've already described which11 is, on page 70, it says they have "incorporated OpEx12 based on projected cost savings," and this says13 based on "select precedent transactions." And it14 goes on further to say what I have been saying,15 which is that there are additional synergies that16 they were not incorporating in their model.17 This describes the revenue synergies that18 I have been referencing, so it does remind me where19 it is here. I didn't remember here it was, on20 page 70. But "several upselling and cross-selling21 opportunities."22 And then it says that there are additional23 COGS synergies as a result, like "the manufacturing24 synergies from sharing factories, op support for25 engineering, supply chain, purchasing and

Page 216

1 logistics."2 Q. You're saying it did refresh your3 recollection or you just read to me?4 A. Well, it's consistent with what I've said5 before.6 Q. My question was very simple.7 Did that refresh your recollection as to8 how they calculated synergies?9 A. Not more than I've already said.

10 Q. Okay. Now go to page 77, if you would,11 please.12 Do you recall whether or not there was a13 discussion as to whether or not the overall debt14 load of the acquisition would increase or decrease?15 MR. CHESLER: Hold on a second. I want to see16 that question.17 Objection to the form.18 THE WITNESS: I don't understand your question.19 BY MR. BARON:20 Q. Do you know whether or not there was a21 discussion as to whether or not acquiring SolarCity22 would increase or decrease the debt structure of23 Tesla?24 MR. CHESLER: Objection to form.25 THE WITNESS: Well, there was discussion that

Page 217

1 if we acquired SolarCity, we would take on both its2 assets and its liabilities. And as part of the3 liabilities, there were debt maturities over time.4 And, of course, since one maintained assets, one5 actually has assets by which they can actually6 maintain -- either refinance or other alternatives.7 But we did not just talk about debt and we8 didn't just talk about liabilities. We talked about9 it in the context of a broader asset/liability

10 conversation.11 BY MR. BARON:12 Q. But at the time, even as of June, you13 understood that you would be increasing Tesla's debt14 by acquiring SolarCity; right?15 A. In addition to increasing its assets.16 Q. Let's just take these one at a time.17 You knew it would increase the debt;18 correct?19 A. Yes, as a mathematical exercise.20 Q. And you knew that it didn't have their --21 enough cash in assets to actually pay for their22 debt; correct? We talked about that earlier.23 A. Again, you keep trying to get me to say24 that somehow cash is the way you pay for liquidity.25 And, of course, it is assets. And current cash is

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1 one way in which you pay for maturities and debt2 coming due.3 Q. And do you believe that they had4 sufficient assets to pay off their debt?5 A. Over a period of time, absolutely.6 Q. Through operations or through more7 financings?8 A. Both.9 Q. Are you aware that Elon Musk said that he

10 did not believe that acquiring SolarCity would11 increase the debt load of Tesla?12 MR. CHESLER: Objection to the form.13 BY MR. BARON:14 Q. Are you aware of him saying that?15 A. You would have to show me where he said16 that, when he said it. I don't know what the17 context of him saying it is.18 Q. You do not recall what -- the discussion19 that ensued after Evercore reviewed the potential20 accretion/dilution impact on various21 per-share-earnings metrics for the company; correct?22 A. That was on page 7. Well, I do recall.23 What was discussed after that was an overall24 discussion of the solar industry. So we talked25 about that. And then I also -- and then they also

Page 219

1 talked about some of the alternatives, highlighted2 on page 31, to SolarCity.3 Q. Let me stop you there, if I may.4 MR. BARON: Can you mark this as Exhibit 13,5 please.6 MR. CHESLER: It's 14.7 (Ehrenpreis Exhibit 14 was marked.)8 BY MR. BARON:9 Q. So looking at Exhibit 14, do you recognize

10 these as the minutes for the June 20th meeting?11 That's the meeting where Evercore made the12 presentation you're talking about.13 A. I recognize it as Tesla minutes, but I14 would like to take a look to see what it says.15 (Witness reviews document.)16 Q. I really only have one question for you on17 this.18 A. I'm happy for you to ask it and if I need19 to --20 Q. The question was really simple.21 On the third full paragraph where -- at22 the very end when it says, "Finally, Evercore23 reviewed the potential accretion/dilution impact on24 various per-share earnings metrics for the company25 as a result of a potential acquisition. Discussion

Page 220

1 ensued among the directors and representatives of

2 Evercore," was there a specific discussion about the

3 accretion and dilution impact on various per-share

4 earnings? Was there actually a discussion on that?

5 A. You know, I've already answered. My

6 recollection of the accretion/dilution discussion

7 was -- it does say "on various per-share earnings

8 metrics," so they were both EBITDA and there was EPS

9 and there was a function of describing SolarCity's

10 business model in that context.

11 MR. BARON: Let's go to the next document.

12 Can I have the July 22nd board

13 presentation, please.


15 MR. BARON: Marked as Exhibit 15 is a board

16 agenda and presentation dated July 21st, 2016.

17 Exhibit 15.

18 BY MR. BARON:

19 Q. Do you recognize this presentation?

20 A. Yes.

21 Q. And this is a presentation that was being

22 provided to the board after due diligence of

23 SolarCity, so it included non-public information;

24 correct?

25 A. I don't recall that. I thought that

Page 221

1 the --

2 Q. Take a look at -- you can see on page 2 it

3 says, "Diligence Overview and Key Findings."

4 That would presume to me that there were

5 actual -- during due diligence that took place.

6 A. When you say page 2 --

7 MR. BARON: Did you give me the wrong one? Did

8 you give me the board minutes? I want the

9 presentation.

10 MR. CHESLER: Yes, we have the presentation.

11 MR. BARON: Okay.

12 BY MR. BARON:

13 Q. So look on page 2.

14 A. When you say page 2 --

15 Q. It's page 2 of the presentation.

16 MR. CHESLER: What's the Bates number?

17 MR. BARON: Bates number is 1382.

18 THE WITNESS: 82?

19 MR. BARON: You see, he's looking at something

20 different.

21 BY MR. BARON:

22 Q. Do you see where it talks about "Diligence

23 Overview"?

24 A. At the top as the title?

25 Q. And on page 1, it says, "Key Information

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Page 222

1 Discovered in Due Diligence that Impacts Value."2 Do you see that, on the page before,3 page 1?4 A. Yes.5 Q. Okay. Does this refresh your recollection6 as to whether or not this presentation was made to7 you after due diligence based on non-public8 information?9 A. Yeah, it looks like it was based on

10 information that SolarCity provided in a virtual11 data room. It doesn't say it's based on non-public.12 Q. What do you think is in the data room?13 A. Information related to SolarCity.14 Q. Do you think SolarCity set up a data room15 with public information?16 A. That wouldn't be crazy. I've been in17 diligences where they actually aggregate the18 information because they have access to the19 information more so than the counterparty.20 Q. So is it your understanding that you21 approved this deal with a data room that only22 contained public information?23 A. No. I'm trying to think of what the order24 was around which we actually did the diligence25 around non-public information. And I'm trying to

Page 223

1 ascertain whether, as of July 22nd, we did or2 didn't.3 Q. You know what, that's just a foundational4 question. We'll ask some other questions.5 Do you see the indication here where it6 says, "Key Information Discovered in Due Diligence7 that Impacts Value"?8 A. Yes.9 Q. Do you see that?

10 A. Yes.11 Q. You see on the first line that impacts12 value that there were liquidity concerns talking13 about the revolver covenant levels of 116 million14 being -- getting below that "numerous times over the15 next two months"?16 Do you see that?17 A. Yes.18 Q. And that's consistent with what we were19 talking about this morning, is that internally they20 were talking about getting below their debt21 covenants; correct?22 A. It's the same topic, but in this summary,23 it doesn't say the number of times and what month24 and what date. It just says, "numerous times."25 Q. And that they needed 2- to $300 million

Page 224

1 financing to avoid potential default on its2 revolver, do you see that?3 A. Yes.4 Q. So you were aware they did not have enough5 cash to pay their debt obligations without6 additional financing; correct?7 A. Yes.8 Q. And, again, without us going back through9 the exercise, it's your belief that that is

10 described in the proxy statement?11 A. I didn't say that.12 Q. Is it your belief one way or the other13 whether it's described in the proxy statement, the14 fact that they were significantly -- or that they15 were below their cash balance of the debt covenants16 and that they would need 2- to $300 million of17 bridge financing?18 Is it your belief that that was disclosed19 in the proxy or not?20 A. I'll just reiterate what I said before,21 which is, it's a 137-page document, and I don't22 recall.23 Q. Okay. And that's perfectly fine.24 A. I said it before.25 Q. If you had a recollection that it

Page 225

1 definitely was, that's fine. If you don't recall, I2 understand. I don't recall what's in it, and I3 probably read it more recently than you.4 Do you see where it says that "Silevo5 manufacturing requires significant CapEx and OpEx6 over the projection period to reach full capacity7 and any significant delay or termination could8 result in liabilities ($41.2 million per year for9 each year it does not meet its target cumulative

10 investments and job milestones after achieving full11 product output current termination liability of12 approximately $646 million)"?13 Do you see that?14 A. Yes.15 Q. Do you have any understanding whether or16 not that is described or disclosed in the proxy in17 any way?18 A. I don't recall. I would have to look at19 the proxy in detail.20 Q. Do you see -- on the financial model under21 the diligence overviews, do you see where it said,22 "Management model is a cash-based model. Evercore23 has not been provided with a GAAP-based financial24 model"?25 Do you see that?

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1 A. Yes.

2 Q. Did you understand that to mean that the

3 model that Evercore was provided with was not

4 GAAP-compliant?

5 A. I wouldn't conflate the not provided with

6 a GAAP-based model as not GAAP-compliant. This just

7 says that the management model is cash-based.

8 Q. Do you know how Evercore created their

9 model? Did they start with the SolarCity model and

10 modify that, or did they start from scratch?

11 A. There were a bunch of iterations along the

12 way, and I would have to go back and refresh.

13 Q. So you have no idea as you sit here today?

14 A. As I sit here now, I know there were

15 several iterations on that financial model, but I

16 don't recall what the order was or what the details

17 around --

18 Q. So when you say that you don't believe

19 that Solar Roofs are included in the model, what's

20 your basis for that?

21 A. Because I don't recall there being any

22 discussion around Solar Roofs being a -- factored in

23 to the assumptions that Evercore laid out; rather, I

24 recall them being based on the core business.

25 Q. But you never saw any underlying

Page 227

1 assumptions that said Solar Roofs are not included2 or Solar Roofs are. You don't recall seeing any3 underlying assumptions --4 A. I would have to go back. I don't recall5 right now.6 Q. Are you aware -- so my understanding --7 and you can tell me if you think it's incorrect --8 is that Evercore's models were modifications of the9 model that was prepared by SolarCity. And there may

10 have been some iterations, but it's based started11 from that set of projections.12 Did you understand that?13 A. My answer remains, sitting here today,14 there were a number of iterations. I can't tell you15 where it started from, how it evolved and the16 details around how it changed. I recall the17 conclusions.18 Q. You would agree logically if that's the19 way that they prepared -- two factors. If Lyndon20 Rive said that -- Rive says that Solar Roofs were21 included in the SolarCity model -- and, again, you22 saw a version of the SolarCity model -- do you know23 whether or not Solar Roofs are in that model?24 A. Can you refresh my memory as to --25 Q. Let's look in the model.

Page 228

1 A. -- how many years out we're talking and --

2 Q. If you turn to page 18.

3 A. Okay.

4 Q. The model that you see on 18, what's a DCF

5 analysis on a SolarCity management model, do you see

6 that?

7 A. Yes.

8 Q. Did you understand that to be a set of

9 forecasts that was provided by SolarCity management?

10 A. I continue to say that I see that that's

11 the title for it, but I don't recall that that's, in

12 fact -- that what is labeled as the title was solely

13 based on SolarCity. I know at different points in

14 time, there were models and that there were

15 ultimately modifications to those models. I just

16 don't know what this particular one was.

17 Q. Okay. And you see below on the source,

18 the source was SolarCity management and SolarCity

19 filings; correct?

20 A. Yes.

21 Q. And then the next page, on 39 [sic], talks

22 about there being --

23 MR. CHESLER: 39?

24 MR. BARON: I'm sorry, 19.

25 BY MR. BARON:

Page 229

1 Q. On 19, you see that this says, "SolarCity

2 DCF Analysis (Revised Sensitivity Case)."

3 Do you see that?

4 A. I do.

5 Q. And do you understand this to be a model

6 that Evercore prepared sensitizing what they got

7 from the DCF -- or the management case?

8 Did you understand that?


10 THE WITNESS: I understood at the time as it

11 was -- as someone was walking through the model and

12 explaining in real time what the assumptions were

13 and weren't. As I sit here now looking at it, on

14 page 19, all I can see is that, in both page 18 and

15 19, the sources are SolarCity management and

16 SolarCity filings. And so the fact that there's a

17 changed title for each presupposes that, in fact, it

18 was Evercore who did a sensitivity based on the same

19 source.

20 BY MR. BARON:

21 Q. So as you sit here today, you don't know.


23 Q. If the minutes describe them as I just

24 described them, you don't disagree -- you don't

25 think that's that false; right?

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1 If the minutes actually say that the2 SolarCity management case is what was provided by3 SolarCity and the revised sensitivity case was a4 revision of that undertaken by Evercore -- if that's5 what the minutes say, that wouldn't seem wrong to6 you; correct?7 A. I would have no reason, sitting here8 today, to somehow challenge the minutes in real9 time.

10 Q. Okay. And do you have a specific11 recollection of somebody telling you that SolarCity12 was not -- I'm sorry -- that the Solar Roof was not13 included in the SolarCity management projections?14 Or was that just your belief because nobody talked15 about it?16 A. Well, again, I think you asked that. The17 projections as I understood them was based on the18 base model -- was based on the base and core19 business as opposed to Solar Roof --20 Q. Did somebody tell you that, or was that21 just your assumption because nobody specifically22 mentioned it?23 A. I can't recall how I learned that.24 Q. If, in fact, the models that you were25 working from originally derived from SolarCity and

Page 231

1 Lyndon Rive said, yes, we were including value of2 the Solar Roofs, would that seem to you to be false3 on his part or just some information that you4 weren't provided?5 A. You would have to tell me what -- the6 magnitude of Lyndon's value ascribed to that. If it7 was immaterial, then it might not change my8 viewpoint. It would depend on the details.9 Q. But you don't think that Lyndon Rive would

10 be lying if he said that when they created their11 projections, that they included value to the Solar12 Roofs?13 A. I can't answer.14 Q. What about -- you know what ITCs are;15 correct?16 A. I do.17 Q. Do you know whether or not ITCs are18 included in the set of projections that were19 provided for in SolarCity management?20 A. You know, you're asking me detail around21 which financial model, so I'll tell you what I22 remember.23 I recall that, number one, the notion24 that -- of the ITC was not an esoteric issue in the25 solar industry. This was front and center of

Page 232

1 discussion of the solar industry whenever the solar2 industry was talked about.3 And so I can't tell you whether -- the4 details around the financial models, but what I can5 tell you is, sitting as a board member of Tesla6 evaluating it, I looked at it as the issue around7 the ITC was baked into the SolarCity public price.8 Efficient markets. It's not as if anybody in the9 public markets doesn't understand the ITC issue, and

10 that was in the SolarCity price.11 Q. Can you show me anywhere in this entire12 presentation on the DCF analysis where the value13 was -- accounted for the fact that the ITC program14 was going to be reduced and then virtually15 terminated?16 A. I can look through this entire17 presentation, if you want, but I -- sitting here18 today, I can't recall that this presentation19 highlighted ITC as opposed to, as part of20 understanding a solar business, as any of the folks21 who invested in SolarCity did, that they had an ITC22 component to how they were valuing the company.23 Q. That's a very fair point.24 Anybody who understood the industry25 understood that the ITC program was being wound

Page 233

1 down; correct? That's what you're telling me?2 A. Yeah, I am telling you that the potential3 of the ITC waning in the absence of new legislation4 was happening.5 Q. So people who understood public markets6 understood that that was waning; correct?7 A. I don't know about people who understood8 public markets, but people who were investors in9 SolarCity clearly understood that.

10 Q. What about Tesla investors who had to vote11 on this? Do you think Tesla investors understood12 that the ITC program was being reduced?13 A. I guess I'd look to -- I don't know if14 it's in this presentation.15 Q. I'm just asking you your belief.16 A. I'm just trying to find it -- a document17 that will help me answer the question that you've18 asked.19 So if you look at what is described as20 Exhibit 13 and you go to page 10 and you look at the21 Tesla shareholders. You asked me did I think that22 the Tesla shareholders understood issues around23 solar and the ITC issue.24 And my answer is, well, as I look on here25 at the analysis prepared for the Tesla board on

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1 page 10 -- I could read through all the names, but2 almost -- all but 6 of the top 25 institutional3 shareholders, so 19 of the top 25 institutional4 shareholders, also were investors in SolarCity.5 So, yes, I believed that the shareholder6 base of Tesla also understood the ITC issue.7 Q. And so those people, like you, who8 understood the ITC well --9 And you understood it at the time that you

10 approved this transaction; correct?11 A. Correct.12 Q. -- would assume that any valuation13 undertaken of SolarCity would consider the effect of14 the ITC program being terminated; correct?15 A. I would maybe look at it differently. I16 would look at it as that any view on what SolarCity17 was trading at, based on the institutional ownership18 that had large overlap with Tesla, would have19 factored that in to the then price of SolarCity.20 Q. Great. Answer my question now.21 My question is, would they similarly have22 believed that any valuation of SolarCity would have,23 by necessity, have taken into account the effects of24 the termination of the ITC program?25 MR. CHESLER: Object to the form of the

Page 235

1 question.2 THE WITNESS: What valuation are you referring3 to?4 BY MR. BARON:5 Q. Any, whether it's a discounted cash flow6 analysis, whether it's a sum-of-the-parts analysis,7 whether or not it is a -- yes, it could be a8 comparables analysis because those comparable9 companies would also have the same issues.

10 All of those various valuation11 methodologies undertaken by investment bankers --12 and you've seen them a lot. You have a business13 degree, so you understand what they are; right?14 Would you believe that every investor15 believes that the fact that the ITC program is being16 terminated would be a factor that a valuation17 professional would consider in each of those18 techniques?19 A. So I was trying to answer your question,20 so I'll try and do it again.21 Yes, with those -- the exact valuation22 methodologies that you're referencing are, in fact,23 the very ones that institutional holders of anyone24 buying or selling SolarCity would also understand.25 So to the extent the ITC was an issue, the

Page 236

1 way I looked at it, as a Tesla board member, was2 that it was factored in to the SolarCity price. And3 to the extent that we were doing a stock-for-stock4 transaction, that was reflected in the valuation.5 Q. Was it taken into consideration in the DCF6 analysis?7 A. It was taken into account in the price of8 SolarCity at the time.9 Q. Was it taken into consideration in the DCF

10 analysis undertaken by Evercore?11 A. I would have to go back and look at --12 (Reporter interruption.)13 Q. I'll ask the question again.14 Do you believe Evercore included the15 wind-down of the ITC analysis in its discounted cash16 flow analyses?17 A. Again, I would have to go back and look at18 the details behind Evercore's model to answer that19 question.20 Q. Would you expect that they would have21 accounted for the well-known, as you said,22 termination of the ITC program in their DCF23 analysis?24 A. Can you clarify what you mean by account25 for it.

Page 237

1 Q. Take it into consideration, not put value

2 on SolarCity that would not be there because the ITC

3 program no longer exists.

4 A. Again, a valuation is not done in

5 isolation. And so I would have to understand and

6 look at what underlying assumptions were and weren't

7 being made.

8 Q. Did you do that when you approved this

9 transaction?

10 A. At the time, we relied on the Evercore

11 analysis. And I can't recall whether or not that

12 one particular aspect to how they did their

13 valuation methodology was or wasn't included,

14 sitting here today.

15 Q. Do you know whether or not the proxy

16 indicates whether or not the ITC credit issue is

17 included in their DCF analysis?

18 A. Again, it's a 137-page document that I

19 know that -- I can't say that I've looked at in

20 three years, so I can't recall.

21 MR. CHESLER: Can we go off the record for a

22 second.

23 MR. BARON: Sure.


25 The time is 3:30 p.m. and this ends Media Unit 4.

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Page 238

1 (Recess taken.)


3 3:42 p.m. and this is beginning of Media Unit 5.

4 BY MR. BARON:

5 Q. With regard to Exhibit 15, do you know

6 whether or not that was vetted by Elon Musk before

7 it was provided to the board of directors?

8 A. I don't have any knowledge.

9 MR. BARON: Can I have the July 30th

10 presentation, please.

11 Can you mark that as 16, please.


13 BY MR. BARON:

14 Q. I'm showing you what's been marked

15 Exhibit 16.

16 Do you recognize this document?

17 A. Yes.

18 Q. What is it?

19 A. Looks like a presentation given to the

20 board on July 30th, 2016.

21 Q. Did you understand this to be the final

22 presentation that was provided to you from Evercore

23 about the merger?

24 A. Yeah, I believe this was the -- was this

25 the presentation where they gave their fairness

Page 239

1 opinion?2 Q. Yes.3 A. Yes, in answer to your question.4 Q. Were you aware of whether any of the5 valuation information that was provided to you on6 the 22nd in any substantive way changed between the7 22nd and the 30th?8 A. I would have to refresh here for a moment9 as to the timing.

10 So it looks like -- on the 22nd, it looks11 like at that point in time where we had an exchange12 ratio -- I have to look. Was that when we were at13 .105, on the July 22nd date?14 Q. I don't know. You can look at it and see.15 A. It does look like that. So July 23rd.16 Okay. It looks like -- yes, as I look at it now, it17 looks like -- as of July 22nd, it looks like we were18 at an exchange ratio of .122 to .131.19 And then it looks like as of July --20 July 30th, at that point in time, it looks like we21 ended up going down to -- ultimately to a .1122 exchange ratio. Looks like in between, we revised23 it to .105. And then it looks like on July -- so24 you're asking me if the interval between the 22nd25 and 30th -- so, yes, there was a lot of activity,

Page 240

1 now that I'm looking at this and remembering.2 We initially went to a .122 to a .1313 offer. We then got a counteroffer higher than the4 higher end of our range on July 23rd of .136. Post5 the July 22nd meeting that you asked me about as the6 point of reference, we got a counteroffer of .136.7 We then reviewed and ultimately decided8 not only not to accept the .136, but to go below the9 low end of our initial offer, to .105.

10 We then got a counteroffer on July 26th of11 .1265. And we then decided to, again, go below the12 range of the original offer, down to .11. Sorry.13 We then went to .105. They countered at .1265. And14 then between the July 22nd and July 30th date, we15 ended up saying that we were at .11.16 Q. My question was, did any of the valuation17 information -- not the bid price, the valuation18 information change?19 A. Can you clarify what you mean by20 "valuation information."21 Q. Was there a revision to the discounted22 cash flow analysis to any material effect, any new23 valuation information that came on inclusion or24 exclusion of synergies, some other valuation metric25 that you recall being of significance to the board

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1 of directors?2 A. Well, I can't recall with detail without3 looking at the docs, but I can say, as summarized4 here on page 1 -- or Document 1119 that, yes, there5 was discussion on valuation. And it's referenced on6 several of the bullet points. And that resulted in7 the exchange ratio modification.8 Q. What was the result of the exchange9 ratio --

10 A. It's right here on the bullet point, that11 the Tesla board reviewed diligence updates and12 discussed valuation and that among -- the diligence13 updates and valuation discussion resulted in a14 changed and reduced exchange ratio.15 Q. What was it that you learned that caused16 you to reduce the exchange ratio?17 A. I would have to go back and look at all18 the details of each of those dates at this point in19 time.20 Q. Was there additional due diligence that21 you think took place or was there just additional22 discussion of the due diligence that took place?23 A. Again, sitting here now, I can't recall24 between those specific eight days in July 2016 what25 the order of the findings were. I can say that

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1 clearly the Tesla board met multiple times to2 discuss and review diligence updates and discuss3 valuation, which resulted in a changed exchanged4 ratio.5 Q. But as you sit here today, you can't6 actually say what changed in between there.7 A. I can't remember the order of the8 diligence findings and how -- what the details were9 between those eight days.

10 Q. Did you come to learn that SolarCity was11 more valuable or less valuable?12 A. We came to -- the diligence caused us13 to -- we learned a number of things during diligence14 that were positive and negative, but the net result15 of it was a reduced exchange ratio.16 Q. Meaning you thought it was worth less.17 A. Yes. Or less as a ratio of Tesla.18 Q. Was that because you believed that there19 was some new information you were finding that was20 worse on the SolarCity side or something that you21 thought was problematic on the Tesla side?22 A. I don't recall learning -- somehow23 learning something more about Tesla between those24 dates. But, again, I could be omitting some things25 from my recollection today. I just don't remember

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1 the details between those eight days.

2 Q. And you have no recollection of what it is

3 that you think perhaps happened at SolarCity in

4 those eight days that you didn't know before?

5 A. I don't recall there was something that

6 happened at SolarCity. I think it was as a result

7 of diligence and the reporting thereof.

8 Q. And you think that there was something in

9 the diligence that showed you some new understanding

10 of SolarCity that you didn't know on the 22nd.

11 A. Again, I can't recall the specific dates,

12 but I can say that it was summarized here on page 2,

13 the matters that potentially impact value. And so

14 as I look here now, looking at these additional

15 findings, it lists five bullet points.

16 And, again, I would have to go back to

17 look at which of those were additional -- how to

18 parse what was new information in these eight days.

19 I just don't remember the timing.

20 Q. You can look at the same thing on key

21 information discovered in due diligence that talks

22 about those finding.

23 Is there something new that you thought

24 was important?

25 A. Can you point me to where you're talking

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1 about.2 Q. Sure.3 Exhibit 15, on the 22nd, on page 1 and 2.4 A. Can you point me to the page number5 because I don't know that we --6 Q. Tesla 1381 and 1382.7 A. Okay. Well, the first bullet point looks8 pretty similar. So the July 30th references "Other9 legal and contractual obligations, the amount for

10 which were provided by the Tesla legal team."11 Again, I don't remember the detail around12 that, but that looks like a variance.13 Q. That was on the 22nd; right?14 A. No, that was on the 30th.15 Q. Take a look at --16 A. Correct. I stand corrected. It was17 actually in the -- on the 22nd, that was listed not18 as a separate bullet point as it is on the 30th.19 It's a subbullet point, so I stand corrected.20 So the additional RIF of employees, but21 that would actually be a net positive.22 Q. You would consider that a net positive?23 A. I would consider savings to be a net24 positive.25 Q. What about the reduction in work force;

Page 245

1 did you consider that to be a good thing or bad2 thing?3 A. I can't remember the context, if this was4 a further refinement of the synergies that developed5 on the expense side, but that would not be a6 surprising rationale for why you get additional7 savings from the combinations that were not8 accounted for in the management model. Because the9 management model wouldn't account for those

10 synergies.11 So the other thing -- and then, of course,12 it says, "Current regulations and policies regarding13 net metering," but that does not refresh my memory14 that that was somehow learned between the 22nd and15 30th.16 Q. So there's nothing there that refreshes17 your recollection as to something that was learned18 that made you believe that SolarCity was worth less;19 is that a fair statement?20 A. It's fair to say I can't remember the21 details as to what specifically was learned during22 those eight days.23 Just so I'm being accurate here. I just24 want to say -- so the frame of reference, as I'm25 refreshing my memory now, looks like the original

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Page 246

1 exchange ratio was actually not on June 22nd --2 July 22nd. It looks like it was actually on3 June 30th.4 And so the variance of information that5 unfolded was not in those eight days per se; it was6 actually between June 30th and ultimately when7 Tesla's board, which continued to review diligence8 findings, changed its exchange ratio on July 24th to9 .105.

10 So, in fact, the exercise I was just doing11 was not the right exercise. The proper exercise is12 all the findings between June 20th and July 24th,13 which was the first time Tesla changed its exchange14 ratio.15 Q. My question was, was there any change16 between the 22nd and the 30th?17 And your answer --18 A. My answer is, I don't recall.19 MR. BARON: I don't think I have any further20 questions. Yep, I'm done.21 THE VIDEOGRAPHER: We're off the record at22 3:58 p.m. This ends today's testimony given by Ira23 Ehrenpreis. The total number of media used was five24 and will be retained by Veritext Legal Solutions.25 MR. CHESLER: State for the record that we

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1 designated it under the protective order as2 confidential.3 (Whereupon, the proceedings were concluded4 at 3:58 p.m.)5 ---oOo---6789 ______________________________

10 IRA EHRENPREIS111213141516171819202122232425

Page 248

1 I, the undersigned, a Certified Shorthand2 Reporter of the State of California, do hereby3 certify:4 That the foregoing proceedings were taken5 before me at the time and place herein set forth;6 that any witnesses in the foregoing proceedings,7 prior to testifying, were administered an oath; that8 a record of the proceedings was made by me using9 machine shorthand which was thereafter transcribed

10 under my direction; that the foregoing transcript is11 a true record of the testimony given.12 Further, that if the foregoing pertains to13 the original transcript of a deposition in a Federal14 Case, before completion of the proceedings, review15 of the transcript ( ) was (X) was not requested.16 I further certify that I am neither17 financially interested in the action nor a relative18 or employee of any attorney of any party to this19 action.20 IN WITNESS WHEREOF, I have this date21 subscribed my name.22 Dated: May 30th, 20192324 <%16617,Signature%>

_____________________________25 ANRAE WIMBERLEY, CSR No. 7778

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able 70:14 71:972:9 90:10 111:7132:21 137:23155:25 157:9,23159:2,12 161:17178:21 186:3203:20

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237:17 240:22analyze 188:2analyzed 102:3analyzing 213:1andela 52:14announce 109:4,5announcement

109:17 110:3112:15

annuity 81:6,16anrae 1:23 2:18

9:16 248:25answer 8:9 16:2

29:11 49:12 61:2377:4 78:17 87:1387:17 88:11,1390:11 91:14 94:494:12 108:11111:11 113:22,24114:25 149:15156:22,25 157:3,4157:11 161:10174:9 179:10185:6 194:4197:25 198:24199:4,9,12 201:9201:22 202:1,8,20203:20 207:11209:1 211:20227:13 231:13233:17,24 234:20235:19 236:18239:3 246:17,18

answered 94:1697:19 104:13158:20 220:5

answering 144:6answers 89:14

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anticipated 64:21126:18

anticipating 65:2anticipation 57:24anybody 64:25

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asking 23:5,1127:2,8,10 28:839:23 49:11 52:954:13 65:5 69:2180:15 90:17 94:8104:15 106:16107:12 108:8110:24 112:20113:18 114:16120:18 132:3133:13 137:20142:2 149:9,12,16150:8,10,20,21152:24 164:22168:20 174:8,20184:24,25 193:7194:3 198:2199:17,21 200:1201:25 202:2204:5,6 205:24206:15 211:18212:16 231:20233:15 239:24

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6:4,20 15:16105:14

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66:5,6,16,16,1867:4 68:9 90:3,1891:2,19 92:2,1696:18 99:21,23100:1 111:12,13111:17 114:11115:14 116:9,14116:24 117:2,5118:8 121:7,8123:6 126:25127:1 128:12,15147:18 148:2,9153:8 160:9161:15,18,21,24163:9,15 165:10166:21 170:5181:8 191:17,24203:14 212:23218:9,14 224:4227:6 239:4

b

b 5:6 6:1 7:1 8:174:3 150:13 166:6197:15

back 11:10,2015:3 19:6 21:3,921:21 26:8 40:25

63:17 68:25 69:769:23 71:20 72:272:3 80:7,1981:16 89:10 90:1591:6 92:8 93:2594:2,9 95:6 99:19108:9 112:15,24116:16 118:21119:2 120:5,12121:18,20 125:3128:14 129:5,7130:20 134:11136:1,15 142:4,16142:19 144:21147:11,15 148:9156:10 167:10170:8 173:22174:1,9,14 180:2184:21 188:19189:1 190:10198:4 204:18,25205:5 208:13214:16,23 224:8226:12 227:4236:11,17 238:2241:17 243:16

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119:16,21 121:10121:24 224:15

baldwin 3:16 9:259:25

bank 92:16 94:13bankers 74:7

96:11 120:10122:8 129:1 134:3155:19 175:11176:6 177:16197:21 235:11

banks 92:24 93:493:8

barnard 67:774:21,25 77:578:11

barnard's 77:23baron 3:4 5:3 9:19

9:19 10:9 14:1715:2,9,11 16:1218:22 22:25 23:127:3,13,22 33:2334:11 35:13,1438:22 41:22 43:148:23 49:3 50:2153:17,23 54:9,1555:9 56:25 57:2260:8,11 61:2463:11,20 64:2,465:18 66:15 72:2372:25 74:20,2475:14,24 76:377:10 78:16 81:2084:1 85:9 88:1,1690:12 91:13,2492:15 94:3,1898:13 99:20101:10 102:10104:20 105:7,10105:22 106:1108:19,20 109:24

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believes 95:17235:15

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c

c.a. 1:4 2:4cac 145:22calculate 24:20calculated 214:14

216:8calculating 40:3calculation 141:16calendar 113:20california 2:16 3:7

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calling 44:12182:5

calls 177:15cap 28:12 36:1

42:11,12,18 43:2144:14

capacity 225:6capex 225:5

capitalist 16:535:24 36:2,843:14 47:3,23

capitalists 16:439:18

car 142:12 144:23144:24 145:4,8,14

care 51:24career 10:12,16careers 44:3cars 138:9 155:7

162:9

cases 31:19 42:1051:2

cash 64:21 65:3,2466:9 68:17,18,2068:21,22,23 69:6,8

69:14,18 70:4,1970:21 71:1,2,572:11 80:24 81:1182:6,8 83:1 84:1684:17 85:14,1886:14,14,21,2187:4,21,24 88:789:16 90:6 96:1299:8 101:24105:18 109:10110:3,21 114:8,9114:11,17,22119:16 121:7,9,24122:3,13 178:9,22179:2,6,7,8,19191:23 192:1193:5,8,13 210:16210:19 217:21,24217:25 224:5,15225:22 226:7235:5 236:15240:22

catalyzing 203:7categories 56:7caused 241:15

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certainty 159:9171:11

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certify 248:3,16cetera 151:19

152:13cfos 143:20chain 60:13 61:20

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chains 64:6chairman 182:25

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challenge 198:14230:8

challenging 38:838:10 39:8 110:21

chancery 1:1 2:19:9

change 165:3,14178:4 187:16231:7 240:18246:15

changed 110:25179:2 227:16229:17 239:6241:14 242:3,6246:8,13

changes 105:17changing 139:14characterized

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check 177:15checking 37:15chesler 3:15 9:23

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chest 64:21 66:21choice 45:25 50:2chose 11:17chosen 166:5chu 30:10 31:6circumstances

93:3cite 15:23cited 88:14cities 161:17clarification 56:4

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classic 144:1classify 56:6clean 29:17,19

30:2,9 50:4 51:1053:6 54:18 56:9

clear 16:22 51:2054:22 117:17206:11

clearly 73:13 86:699:2 131:6 137:21138:4 153:14189:1 191:10194:21 196:25233:9 242:1

close 12:21 55:1481:25 96:13 97:4

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closed 152:22168:10

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135:16collectively 17:19

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combination 82:591:10 128:22131:13 139:5143:14 184:11

combinations245:7

combined 83:985:6 86:9 101:21144:16 170:12,14193:3

come 15:3 76:1787:24 93:9 242:10

coming 69:2,9,17153:1 159:21181:8 218:2

comment 189:5commercial 79:3

79:10,12,20commercialization

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commercializing141:4 146:17158:14

committee 96:1196:19 115:9

common 93:2194:5

communication61:6

communications62:3

communities164:17

companies 10:2512:15 15:24 20:2321:6 22:20 23:725:7,20 26:1,2,4,626:11,14,20,2328:16,18,23 29:1829:25 31:6 36:3,536:10,11 38:1,940:11,23 41:1942:3,20 43:8,1547:14 50:2,3,7,950:16,18 51:2552:10 53:2,7 54:554:7,11 56:6 69:273:21 76:14 91:1693:4,9,17,22 101:3101:23 140:3143:16 172:16188:16,16,18196:21,23 197:8235:9

company 11:315:25 19:1,228:20 30:2,23

32:1 50:4,5,2252:22 55:11 68:1468:16 73:6 74:1781:5 82:14,16,1682:18 83:10,11,1683:20,21 84:3,4,684:9,10,10,11,1284:13,18,24 85:1085:11,17 86:987:10 93:20 95:1495:21,23 96:8,1597:4,9,13,15100:25 101:17,19102:7,14,16,23103:20 104:9,23104:25 107:23108:1 131:3,3132:19 135:3139:19 141:2144:15,19,23150:25 154:23156:3 161:7,11162:16 170:12,14178:5 179:15183:18 184:19,21185:8,16,17,20193:4 198:6,6218:21 219:24232:22

company's 11:2235:25 96:12,1497:5,14 98:1799:8,10 101:24144:13 173:6

comparable 235:8comparables

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compelling 137:25155:23

completely 16:8completion 248:14complex 165:12compliance 162:2

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components 88:13144:25 190:2

composition 179:1comprehensive

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concern 57:159:14 100:23

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concerns 223:12conclude 84:8concluded 134:18

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conclusions 161:8161:12 227:17

concurrently64:16,17

conference 109:11confidential 1:11

2:11 247:2conflate 226:5conflict 59:20,20

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cons 185:9conservatism

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consideration107:7 109:12126:17 236:5,9237:1

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considering 56:2165:7 87:20 127:10127:17 210:5

considers 27:23consistent 16:9

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consolidate 172:6

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constant 111:9consumers 145:20

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contingency 99:17contingent 149:11continuation

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continued 196:6,8246:7

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contractual 244:9contribute 208:11contributed 57:9convene 183:11,17

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conversation 58:758:8,9 63:8 73:774:5,16 79:5137:8 176:25185:7 202:10,11217:10

conversations176:6 184:23197:5 204:10205:10

conversion 37:1337:17 86:25

conversions 87:3,6convert 68:3converted 37:4,6convertible 87:2conviction 38:15

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68:1corby 10:3

corey 94:22,24

corporate 168:3183:10,14

corrected 244:16244:19

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costs 151:18152:13 156:7

could've 187:20counsel 4:7 9:17

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count 33:15countered 240:13counteroffer

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course 11:21 36:766:12 79:9 89:793:9 100:12 107:2109:1 161:20217:4,25 245:11

court 1:1 2:1 9:99:16 18:20 53:1953:22

cousin 67:22 126:5covenant 81:17

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cover 70:19167:19

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crisis 35:16,1767:15 68:2,8,11,1370:6,19,25 83:1,1992:19 99:18125:11 126:21

cross 215:20csr 1:24 248:25cumulative 12:18

24:22 25:17 39:2139:25 40:6 42:1248:13 71:16 120:7225:9

current 13:4 21:155:11 89:3,4,6,689:12,24 98:1129:23 165:21217:25 225:11245:12

currently 22:246:12 116:5 131:4163:3 171:23

customer 81:7138:2 145:8,22146:6

customers 78:1878:22 146:10

cut 98:14cycle 195:4cycles 194:9cynthia 57:5,25

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cynthia's 57:6

d

d 5:1daedalus 6:8daily 177:15dan 28:16,22,22

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date 32:18,2134:17 69:21,2574:3,3 86:16108:8 118:3123:10,16 148:7148:23,23 149:14149:14 152:16156:6,9 157:25158:2,5 159:13

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dated 5:9 6:3,116:15 15:14 60:1264:1 75:1 152:7167:19 220:16248:22

dates 69:24 70:898:20 147:10159:14 184:21241:18 242:24243:11

david 4:3 9:14day 60:14 73:8

125:23,25 145:13152:17,17,23198:15

days 241:24 242:9243:1,4,18 245:22246:5

dcf 143:4 212:11228:4 229:2,7232:12 236:5,9,22237:17

de 169:2,3 170:2,2171:8,8 174:15

deal 66:24 67:287:21 162:11164:25 167:4222:21

dealings 29:4debate 191:13debt 69:4,14,17

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debts 68:21,2471:5 83:17

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deciding 13:7 96:7186:7

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decisions 38:18deck 169:13,17decrease 216:14

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delay 225:7delayed 159:22deleted 124:13deliberate 186:3deliberated 112:4deliberation

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description 5:86:2 7:2 8:2 35:15

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determination70:6 81:24 85:2297:9 133:1

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dial 185:12dialogue 196:3diego 3:7difference 145:25

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documents 7:147:23 8:4 63:23

107:11 108:3,10117:16 124:3148:9 170:20174:2 175:3191:14,19

doing 11:14,1613:11 33:1 48:354:14 58:20,2360:5 62:17 83:1584:10,18 88:1191:20 96:7 100:5100:7 101:6 155:4162:21 165:10198:15 200:5207:20 236:3246:10

dollar 36:1 37:1437:17,23 43:1658:25 169:1

dollars 12:22 37:543:15 142:5174:14 192:2193:5

double 15:19 22:636:25 38:15 48:24

doubled 38:2439:6 40:23 41:341:13

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e

e 5:1,6,9,18,21,246:1,3,11,15,19 7:18:1 15:13 30:1533:25 34:1,2,1959:12,16,18 60:860:12,13,14 61:1962:20 64:5,6,7,764:15 65:13 67:667:19 74:25 75:1976:13,18 78:4105:11 167:19168:16,18,19169:9,15 175:1,5180:8 182:23184:2,3,13

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earliest 42:14early 14:14 26:4

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earth 53:1 180:25ebitda 189:19

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echesler 3:20economic 59:9economics 19:7ecosystem 47:19editorial 159:18effect 26:24 87:6

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eight 12:19 241:24242:9 243:1,4,18245:22 246:5

eighth 3:17either 14:22 16:20

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25:15 26:12elon 10:16 11:11

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elon's 158:8200:19 202:24205:3

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ends 145:23237:25 246:22

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energy's 30:14engage 199:16engaged 197:21engineering 135:5

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eps 185:24 189:16189:25 190:3,9,12191:7,16 211:5,13211:25 212:25213:5,9,11,15,17220:8

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evanson 6:16167:23 168:1

event 144:11eventually 23:8evercore 66:12

69:12,13 70:1380:2,20 90:1992:9 97:23,25116:17 118:21,23120:12 123:8,23123:25 128:23129:12 131:16138:16,21 142:4143:4 146:14147:4,5 177:2190:1,13 209:18209:25 213:3215:9 218:19219:11,22 220:2225:22 226:3,8,23229:6,18 230:4236:10,14 237:10238:22

evercore's 210:4227:8 236:18

everybody 185:13evidence 151:25evolution 100:18evolutions 100:13evolve 56:8evolved 128:19

227:15evolves 48:11evolving 31:18exact 235:21exactly 18:10 37:6

65:13 71:3 103:5120:23 130:20196:17

examination 5:210:8 125:6

example 43:1356:9 58:19 146:1165:5,5

examples 36:739:1 41:2 50:9143:23,25

exchange 98:12109:20 111:6,8175:24 176:10,16176:18,25 239:11239:18,22 241:7,8241:14,16 242:15246:1,8,13

exchanged 177:10242:3

excitement 136:21exciting 138:2exclusion 240:24excuse 210:10execution 139:21executive 147:4exercise 217:19

224:9 246:10,11246:11

exhibit 5:8,9,15,185:21,24 6:2,3,7,116:15,19 7:2,3,8,137:17,22 8:2,3 15:515:10 21:21 25:449:1,2 60:10 64:264:3 74:22,23105:9 115:5,6152:5 167:16,19180:9,12 187:1195:12 204:25207:23 209:5,19219:4,7,9 220:14220:15,17 233:20238:5,12,15 244:3

exist 111:11140:20 154:14

191:17existed 106:15

144:5 173:12214:18,20

existence 13:1017:12 79:12

existing 51:7 54:5exists 29:20

106:22,23 237:3exit 20:2,6,7 22:17

23:22 25:18exits 22:8,16 23:15

23:20expect 236:20expectation 104:8

131:2expected 103:14

116:5,24 118:20119:6 126:18192:2 193:9

expecting 103:8,9expects 87:4expense 142:7,25

143:9,10,15,21147:1,14 192:23245:5

expenses 103:21experience 50:15

141:8 152:3153:12,15,21155:2,12 156:15157:12,13 159:18

explain 12:2314:25 37:4 57:23105:3 119:14144:20 207:3

explaining 229:12explore 188:2express 61:4,17

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expressed 60:3185:3

expressly 54:5extent 59:4 81:2

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externally 37:10extreme 154:15

f

face 47:17facility 96:14 97:6

97:15 98:18 99:10fact 16:8 37:12,14

37:15 45:4,7,859:4,8 62:2564:20 73:8 97:22118:16 122:20130:15 137:5140:2 151:4153:19 154:18,20155:1,13 156:16157:17 159:25160:1,2,5 162:17172:15 176:15,24179:1 189:4,5193:22,25 194:23224:14 228:12229:16,17 230:24232:13 235:15,22246:10

factor 133:1154:21 155:1,15155:15 186:9235:16

factored 155:17155:18 226:22234:19 236:2

factories 215:24factors 82:25

85:13 129:20

139:23 153:6227:19

facts 28:3 98:12110:25 111:1125:24 136:18202:16

failed 140:5fair 10:10 44:10

81:21 141:21142:23,25 146:24154:3 232:23245:19,20

fairness 238:25false 229:25 231:2familiarized

136:16far 64:20 71:18

73:4 101:14 109:9114:22 122:14146:2 152:1 160:9173:2 181:19183:18 206:3

farmers 52:14fashion 74:2

106:23 120:14fast 42:16 186:8faster 157:18february 5:24

6:19 72:15,1674:9,15,20 75:276:11 77:1,1579:25 80:9 92:21180:7,15 187:5196:5,14 198:4200:14 202:13,19203:8 205:6207:15 209:5

federal 248:13fee 19:3feedback 149:16

149:20,22 150:1

felt 186:1fight 211:17figure 11:20 62:7

69:8 76:24 84:2092:9 116:17 120:6120:13 153:13156:3 204:18

figured 214:21filed 9:8filings 228:19

229:16final 238:21finally 219:22finance 94:10

151:15 152:11154:13 167:2168:7

financial 14:2138:20 40:18 41:2154:25 55:7 74:1480:20 88:23 90:2090:21 93:22 99:13107:9 108:25116:2,21 122:19128:24,25 129:3141:1,18,23 170:8174:15 213:21,22225:20,23 226:15231:21 232:4

financially 142:10248:17

financials 65:1566:13 67:4 68:969:1,8 70:20 81:490:22 91:12 97:2498:1,10 107:11124:2 131:16172:6 173:18174:2,6 207:7

financing 81:192:11 121:6125:10,13,18139:19 166:22167:6 224:1,6,17

financings 218:7find 41:15 89:19

94:10 233:16finding 242:19

243:22findings 221:3

241:25 242:8243:15 246:8,12

fine 168:14 169:21177:4 224:23225:1

finish 179:22201:9

finished 13:3finishes 18:18fire 161:17 163:10

163:14,15,22165:21,23

firm 11:3,3 13:1315:20 16:6 26:1132:5 33:14 44:946:21 47:13 48:1151:6

firm's 32:5firms 12:25 44:8

47:3,4,6 48:11first 22:6 33:12

44:5 60:13 63:2567:18 68:1 70:1,571:3 72:16 73:1,973:15,24 74:3,675:3,7,19 76:5,776:16 79:24 85:1788:14 92:20101:14 115:15119:13 122:6

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fit 74:18five 22:8,16 23:20

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flew 180:23flexibility 107:25flip 119:2,3flow 178:9,22

179:8,20 192:1193:5,9,13 210:16210:19 235:5236:16 240:22

flows 179:2fly 47:17focus 29:17 41:5

137:16,17 144:2146:22 165:18193:21

focused 131:17137:14 166:11194:3

focusing 30:16folks 29:15 30:19

31:21 35:25 46:246:4 79:6 140:3186:1,14 188:24232:20

following 137:20follows 10:7

footprint 143:18force 138:8 244:25forecast 77:20,24

78:2,3,3,12 123:17123:20,22 128:19

forecasting 100:15100:18 129:16160:3

forecasts 107:3128:24 228:9

foregoing 248:4,6248:10,12

form 16:1 22:2326:25 27:19 33:1134:10 38:3 41:742:25 50:20 53:2454:12 56:18 57:2161:22 65:11 66:1070:4 75:12 77:678:14 81:19 83:2485:2 88:9 90:891:8,21 92:793:23 98:7 99:11101:2 102:9104:12 109:22110:6,23 112:9,18113:1 116:10119:10 120:13,24121:11 123:9,24124:4 126:7 128:7133:10 141:1142:21 148:6150:4 153:9 154:4154:10 158:19160:21 162:2,6163:17 164:12165:25 166:8173:13 174:18177:5,11 178:11179:9 181:23189:13 192:9

193:15 197:12198:10,21 200:7200:25 203:18208:19 209:3,11213:6 216:17,24218:12 229:9234:25

forma 211:4 212:3212:18 213:15,25

formal 31:22formed 22:19former 30:10forth 48:1,2

142:16 248:5forum 45:25forward 89:22

170:13 186:8,21188:10 211:2

forwarding 42:16fossil 145:3,4foundational

223:3founder 27:23founding 30:14four 48:24 76:6

103:3 120:21130:1,21

fourth 87:5 152:9frame 245:24french 181:17front 21:22 81:12

194:24 195:4231:25

full 30:9 84:1990:23 102:3,18111:23 132:5194:6,24 219:21225:6,10

fully 162:17

fund's 12:5fundamentally

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g

gaap 225:23 226:4226:6,6

game 91:15gap 76:19,24 77:3

122:15 194:22gather 188:1gc 205:20geller 3:3 9:20,21general 28:14

42:15 84:5 133:21161:11 185:8194:25 207:25

generalized130:13 181:10

generally 25:2581:18

generated 145:6generic 17:13getting 56:15,19

57:3 59:10 62:10128:4 145:23148:4,25 149:6,7149:16 150:2151:18 161:16162:25 164:5174:6 184:20199:8,8 223:14,20

gigafactory 155:9give 15:2 27:9 56:5

74:20 112:24138:12 143:25156:17 159:4,13160:11 162:7180:7 185:14221:7,8

given 21:16 29:1733:18 34:19 36:2447:6 146:15149:23 153:20159:14 167:1,6175:15,15 177:4214:10 238:19246:22 248:11

giving 44:24,2587:6 159:6

go 11:20 13:1219:6 21:3,9,2122:5 26:8 34:4,437:25 39:2 40:2541:23 42:15 45:2253:20 68:25 69:769:23 71:20 72:379:8 80:19 85:486:7 90:9 92:893:17,25 94:5,9103:10 105:16108:9 115:14116:16 118:21120:5,12 122:21124:7 129:5,7130:20 134:11136:15 142:4144:21 147:15161:13 162:11165:6,21 167:10168:6 169:22170:8 173:8,22174:1,9 186:8188:10 190:10192:19 198:20202:8 204:2,18208:13 214:16,23216:10 220:11226:12 227:4233:20 236:11,17237:21 240:8,11

241:17 243:16goal 48:5,7goes 16:5 20:10

76:18 87:9 207:9215:14

going 12:18 13:915:7 36:9 37:1639:2 41:10 55:1057:2 58:1,24,2559:6,14 60:23,2463:13,21 68:869:20 77:3 80:1282:8 83:20 87:2488:20 89:22 90:1591:6,11 96:5104:9 113:17118:19,25 119:6120:20 124:9125:10 131:3,10134:4,5,6 135:5,13136:19 137:6141:11 144:8145:2 147:17149:13 151:16152:11 153:4,5,17153:22,23 155:25156:11,20 157:6157:23 158:1,3,7158:11 159:2163:24 166:22170:13 176:16,25179:23 181:21182:10 185:10,14188:12,19 192:4193:21 194:11,13195:24,25 196:15196:19 197:5,9,15198:7,19 199:23200:4 203:14204:5,11,25206:24 207:2

208:11 209:7211:16 212:4213:12 224:8232:14 237:24239:21

good 9:3 38:1353:23 58:19 78:1978:23 81:18109:17 110:5,22185:16 189:11245:1

google.org 30:16gotten 163:25governance

183:10,14government 165:8governor 30:11granholm 30:11

31:6great 39:12 58:22

102:23 103:15185:16 209:4234:20

greater 135:22greek 180:22green 145:8,10group 46:2 60:23

154:13grow 102:7,7

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104:7 131:2,8,20138:25 155:21

guess 115:15131:21 140:11141:17 196:2207:9 212:10,11233:13

guidance 109:10110:2 111:15112:16,25 114:6

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guided 208:10guy 28:15 104:6

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143:9 183:24

h

h 5:6 6:1 7:1 8:1half 12:21 169:1

174:14 192:2halvorson 4:3 9:14hand 115:24

121:13 183:23handed 183:25handle 61:7 62:4happen 65:16 72:7

143:2 148:17,18148:21 159:22174:5 178:3

happened 12:11111:24 118:3125:18 176:3177:18 188:6194:20 196:4243:3,6

happening 65:974:13 140:23205:4 206:20208:17 233:4

happy 175:4219:18

hard 91:18 119:13133:3,20 137:19189:1 197:2

harder 38:9haul 104:2,9

131:11 154:18hayes 67:7 74:21

74:25 75:25 76:1477:23 78:10

head 77:14 78:2095:17 141:23

161:10health 51:24heard 93:13,15held 7:5,10,19

9:11 37:18,2139:11,13

help 58:3 86:2104:3 137:21187:12 233:17

helpful 98:19helping 30:17

147:23hey 41:5 100:9

198:5,17 200:22203:12

high 103:19161:20 164:19170:19 186:2,18188:9,11,25189:15 192:7194:8

higher 81:10132:12 240:3,4

highlight 42:943:7,7,20

highlighted 41:1943:25 45:12190:13 219:1232:19

highlighting 16:1032:8 43:3 48:14

highlights 48:15highly 93:19 212:4hired 66:12 90:20historic 131:14

138:13,14 139:12141:3

historically 16:728:17 31:22 32:548:14 50:10 82:188:24 131:15

142:19 155:4183:8 184:23185:7

history 29:19,2536:7 41:13 44:1348:13 82:20 138:1139:25 156:6203:6

hit 141:22hold 89:1 216:15holders 235:23holding 21:11

112:15,24home 145:14house 4:7 145:18huffman 3:5 9:21

9:21huh 25:10hundred 193:1hypothesis 47:15

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i

icarus 180:12,19180:21 191:25192:18

idea 34:2 41:942:14 57:2 65:1,674:17 78:4 130:6131:18 137:23145:16 151:22180:20 181:13184:19 194:21197:5 200:18202:15,18,24226:13

ideas 43:15

identified 26:2027:12 28:11 49:1549:18,20 52:1153:7 101:7

identifies 44:23identify 9:17

10:14 15:24 30:2550:1 54:10 76:2589:21 93:18

identifying 100:16ii 22:10,11 23:21

59:23

immaterial 231:7impact 104:4

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impacted 113:6impacts 222:1

223:7,11implied 178:6import 112:8important 80:23

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included 85:1486:14,22 100:14123:18 133:23138:15 140:7142:12 190:1195:1 200:11204:17 220:23226:19 227:1,21230:13 231:11,18236:14 237:13,17

includes 50:1888:22,24

including 33:1664:9 73:22 93:9202:12 213:25231:1

inclusion 240:23income 194:12,12

194:22,22 195:5211:4 212:3,18

inconsistent135:11 137:3202:15

incorporated100:18 215:11

incorporating215:16

incorrect 227:7increase 79:19

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increasing 217:13217:15

incredible 138:25independent

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177:23 179:6indicate 66:7indicates 119:5

237:16indication 181:9

191:1 223:5individual 146:6

201:16individually 12:3

23:13industries 41:20industry 13:9 16:9

30:21 32:7 48:1951:3 102:14,17194:1,25 218:24231:25 232:1,2,24

infer 95:22influence 10:11

114:25influenced 111:2inform 75:7,10information 47:25

48:2 52:6,7,1263:22 75:11 78:13108:14 109:2111:23 113:8115:12 116:8122:19 123:6,8129:1 148:25153:1 154:7175:12 186:2,19188:9,12 196:16197:22,24 207:6,8210:6,7,9,25214:11 220:23221:25 222:8,10222:13,15,18,19

222:22,25 223:6231:3 239:5240:17,18,20,23242:19 243:18,21246:4

informed 96:11infusion 169:2

170:1,23 171:1,17173:9,24 174:12179:6,7

initial 25:15 39:2055:24 74:16193:23 240:9

initially 11:23207:8 240:2

initiative 30:12155:3,3 156:12158:4 159:11161:1

initiatives 30:18162:1

innovative 36:3input 149:13

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insight 199:21insolvency 68:14

68:16insolvent 83:20,21

84:3,7,12 85:10install 138:9

151:17 152:12installation 138:8installed 153:6instance 132:4

institutions 93:22instructed 8:9instruments

174:16integrate 129:23integrated 102:15

130:6,7,16 132:18132:20 134:21144:22 173:3

integrating 73:6integration 138:10

138:13,14 139:20140:17,22 146:1178:3

intended 35:21,2338:6

intent 106:8interaction 199:15interchangeably

181:14interest 21:18

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37:8 78:2internally 37:10

65:23 223:19interpret 78:6

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interruption 172:4193:16 236:12

interval 239:24invest 10:25 11:17

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investigate 92:1895:19

investing 11:715:25 29:21 36:243:14 45:4,848:15 49:19134:20 157:13

investor 47:1067:1 168:2 235:14

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involves 45:16involving 28:5ip 139:15,24

153:13,14 155:3156:3 158:3

ipo 11:22 20:522:13,13,15,1623:22 24:7,1039:12

ipos 22:8,16 23:20144:1,7,10

ir 175:6ira 1:14 2:15 9:7

10:5 18:18 246:22247:10

ish 65:16isolate 133:3 138:5isolated 133:6

144:23isolating 138:12isolation 237:5issue 57:14,23

58:15 63:8 65:975:9,17 76:8,12,2177:5,16 81:11120:16 154:15158:11 231:24232:6,9 233:23234:6 235:25237:16

issued 117:21issues 131:22,23

131:25 132:1,3161:15,19 163:10163:15,23 164:11164:18,25 233:22235:9

itc 231:24 232:7,9232:13,19,21,25233:3,12,23 234:6234:8,14,24235:15,25 236:15236:22 237:2,16

itcs 231:14,17item 186:13

iterations 226:11226:15 227:10,14

j

jason 184:12200:13,17

jeffrey 167:23168:1

jennifer 32:2job 1:25 58:21

59:3,9 60:5 62:17225:10

joining 23:17joint 11:7journey 202:12judge 106:8judged 38:18judgment 36:9

38:6,11july 69:22 96:5

98:15 99:7 100:21100:21 105:12107:22 108:1110:14 115:4117:19 118:1119:7 123:13125:17 126:2220:12,16 223:1238:9,20 239:13239:15,17,19,20239:23 240:4,5,10240:14,14 241:24244:8 246:2,8,12

jump 180:5jumped 195:6june 65:21 80:1,9

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k

kaiam 51:14kathryn 3:16katie 9:25kbaldwin 3:21keep 45:10 107:11

217:23kept 151:9key 138:11 139:22

214:7 221:3,25223:6 243:20

kind 135:14141:19 144:3,13149:22 154:17155:5,12,21161:16 165:10166:13 182:23

kinds 81:13160:24

kit 15:13 32:17,2333:1,9 34:8,16

knew 62:21 96:2197:12 106:6,17112:7,7 114:9117:12,13,18118:6 125:24126:8,9 148:18,23150:8 156:11,14157:17 158:11197:18 203:1208:16 217:17,20

know 19:5 24:1224:14,15 28:529:2 32:3,2533:25 34:14,1742:5 44:10 46:2147:20 53:17 55:2158:5 59:18 64:1064:12 67:8,9,10,1167:12,20 68:7,1969:6 70:10,14

71:12,16,18,21,2171:25 72:9 73:177:11 78:1,5,6,1379:4 83:10,1592:24 93:7,8,12,1494:12,13,22,2595:1,2,4,15,16,2096:2 98:6,15,24,2599:8 101:3,14105:24 106:3,10106:11,14,21107:2,19,21 108:1111:10 112:5117:15 121:18122:4,9,14,18,19122:23 125:9126:3,23 127:15127:15,17,24129:12,14 130:21132:8,17 133:3,20134:18 136:4,10136:11 140:11147:5,7 148:12,16148:20,24 151:23153:4,5 154:2,9,11154:13 158:2159:6,8,9 162:20163:2,7,9,19164:19,24 166:4167:21,24 168:4168:17 169:14,19170:22,25 171:6171:16 172:2,5174:11 175:14,20175:22,24 176:2176:14,19 177:14179:1 180:6,18,21181:1,15,20 182:9182:10,14 183:6184:12 185:20,22186:15 188:17,22

189:1,23 190:5194:25 197:2198:14,19 201:21201:22 202:1,3,20202:21,23 203:3203:25 204:17,19205:9 206:6,7,12209:7 210:18,20212:8 216:20218:16 220:5223:3 226:8,14227:22 228:13,16229:21 231:14,17231:20 233:7,13237:15,19 238:5239:14 243:4,10244:5

knowing 106:4126:23

knowledge 27:12107:15 164:7,8,22166:10 175:13,18182:13 205:3,3238:8

known 13:8,1014:15 31:17 62:2563:23 101:6145:22 236:21

knows 141:3

l

label 100:15,16labeled 228:12lack 205:3laid 226:23

largely 42:1348:18

larger 39:15 73:5140:4

largest 27:24102:13 142:18155:9

larry 205:20late 72:16 118:1latest 157:22,25

158:2,5laughed 140:10lawyers 175:11

176:6 206:9,20,23207:1,15,17,19,24208:3,6,9,10

laz 6:5,9lazard 6:7 115:3,8

115:16 122:21124:5

lazard's 96:12lead 103:25leader 76:15,23leaders 30:20 32:7

41:20learn 242:10learned 230:23

241:15 242:13245:14,17,21

learning 242:22242:23

lease 195:2leases 179:3leave 207:10lecture 157:2led 39:11 62:9

98:10,11,12102:16,19 160:6200:13 204:20

left 43:4 46:1115:24

legal 4:2 162:2205:15 244:9,10246:24

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legislation 233:3lend 38:16level 49:10 59:17

123:22 161:20164:19 170:19186:2,18 188:9,11188:25 189:15192:7 194:8

levels 149:20223:13

lever 169:2 170:2171:8

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145:23leveraging 144:18liabilities 85:19

89:4,5,7,9,11,1389:25 217:2,3,8225:8

liability 217:9225:11

lies 137:11life 11:22line 15:19 22:7

36:4 67:16 157:17186:13 223:11

lines 56:5 107:19172:16 173:4

link 213:16liquidity 67:15

68:2,7,11,12 70:670:18,25 80:5,6,1280:25 81:17 82:282:12,15 83:1,1986:9,13,20 87:1287:15 89:21 92:1996:13 97:5,1398:2,4,16 99:9,1599:18,22 100:2,10100:11,23 101:1

101:15,18 102:6104:24 106:14,22106:25 107:23115:21,23 116:2,3117:5,25 118:11118:20,25 119:7119:18,21 120:16120:21,23 122:25125:11 126:20127:4,12,13 128:6131:22,25 132:2217:24 223:12

list 22:20,21 26:841:16 54:7

listed 45:5 51:573:11 244:17

lists 243:15litigation 1:4 2:4

9:8little 16:25 17:9

96:15 97:16 124:7llp 2:15 3:3,14load 216:14

218:11

loans 55:25 56:292:24 93:4

lobby 165:8,22local 161:17,17located 9:12location 204:16lock 55:10

logically 227:18logistics 216:1long 73:22 78:19

78:23 86:2 103:14104:2,9 130:8131:11 154:17190:15 191:10

longer 124:7135:17 145:21156:15 237:3

look 15:18 19:621:3 41:5 44:2268:25 69:7,2372:3 75:7 84:6,1985:7,23 88:1290:21 92:8 93:2594:2 104:16 108:3115:16 116:16123:3 130:20131:9,11 133:5136:4,15 142:19150:18 152:9156:10 159:20167:10 169:8173:5,22 174:10188:12,13 190:10193:19 194:2205:12 214:5215:2 219:14221:2,13 225:18227:25 232:16233:13,19,20,24234:15,16 236:11236:17 237:6239:12,14,15,16241:17 243:14,17243:20 244:15

looked 83:4 85:785:13 90:22,22,23108:25 133:7138:22 170:12171:1 232:6 236:1237:19

looking 45:3 65:2070:13 88:21 89:1997:25 119:17123:14 133:15136:6,18 148:9

151:8 158:18170:19 171:10175:22 184:13189:1 190:14191:8 195:7210:21 212:14219:9 221:19229:13 240:1241:3 243:14

looks 34:1 37:8,1137:13,15,19 41:965:14 76:19,2588:22,25 89:1,2,389:6,12 123:15,17156:9 168:23169:6 170:16184:3 195:17222:9 238:19239:10,10,16,17239:17,19,20,22239:23 244:7,12245:25 246:2

loop 55:15lost 55:5lot 56:10 83:21

86:6 90:10 92:1195:15 102:25103:2 113:2,22129:6 134:17135:23 136:22137:15 153:16194:4,9 235:12239:25

low 110:3 240:9lower 31:20 37:14

37:17 62:10 111:5111:6 121:13132:12

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lunch 115:2 124:6124:12

lying 231:10lynch 94:14lynch's 92:17lyndon 30:4 31:5

32:2 46:3 67:1967:20 71:15,21227:19 231:1,9

lyndon's 231:6lynn 4:7 10:2

m

machine 248:9macro 34:20magnitude 113:3

190:17 231:6mail 5:9,18,21,24

6:3,11,15,19 15:1333:25 34:1,2,1959:12,16,18 60:860:12,13,14 61:1962:20 64:5,6,7,764:15 65:13 67:667:19 74:25 75:1976:18 78:4 167:19168:16,18,19169:9,15 175:1,5180:8 182:23184:3,13

mailed 105:11184:2

mails 76:13maintain 104:10

107:24,25 217:6maintained 217:4major 67:15 68:2

68:7,10,12majority 135:6majumdar 30:13

31:7

making 40:1981:24 112:1113:16 193:23

manage 12:24managed 51:7

54:6

manufactured151:18 152:13

manufacturing153:24 155:10215:23 225:5

mapbox 45:16,2052:15

march 196:5margin 96:16

97:16mark 15:5 49:1

64:2 74:22 115:5152:4 186:22219:4 238:11

marked 15:1049:2 60:10 64:374:23 105:9 115:6118:9 152:5

167:16,18 180:9180:11 187:1195:12 209:19219:7 220:14,15238:12,14

market 20:9 21:136:1 42:11,12,1843:21 44:14 86:1586:22 112:7,7114:10 164:21165:6

marketed 156:1157:10 158:7,17159:2 160:13

marketing 32:9,1462:21 63:2 77:2077:24 78:11

markets 164:10,10164:16 165:14232:8,9 233:5,8

marks 117:3maron 149:23

180:8 205:14,20master 73:10

181:10,12,18184:22 200:19

material 32:1042:18 159:23214:5 240:22

materiality 114:2114:24

materials 32:15151:19

mathematical217:19

matter 28:1442:15 95:12104:21 105:1106:5,6 112:6,14126:25 154:3176:5,8 177:6,9,18

183:15 204:21208:1

mattered 111:21111:22 112:23113:19,25 114:21

matters 126:4243:13

matthew 105:12105:21,22

maturing 69:389:8 90:23

maturities 69:1,969:16 85:8 217:3218:1

maturity 117:16maxwell 3:5 9:21mean 16:6,13

19:24 25:22 40:2246:13 61:25 66:380:22 98:14,25107:19 108:17135:25 140:12146:9 149:3176:14,15 198:13199:20 203:15226:2 236:24240:19

meaning 62:22146:5 242:16

means 37:5,768:18 91:6 95:2596:2 144:20,25169:14 203:25

meant 58:23 95:2095:22 139:17157:14 188:17198:1

mechanism 69:19media 63:14,18

124:10 125:4179:24 180:3

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237:25 238:3246:23

meet 11:11,1370:15 83:1 120:23225:9

meeting 7:3,8,137:17,22 8:3 74:1674:19 93:3 174:7176:11 182:1,4,6182:15,16,19,22183:1,5,12,19184:25 185:1186:10 187:6188:21 189:17194:17,20 195:19195:25 196:7,19197:1,2 201:18202:13,19,22,25203:2,8 204:13,15204:18 205:2,10207:18,21 208:3,7209:21,24 219:10219:11 240:5

meetings 197:4203:9 204:14

megawatt 109:10114:6

megawatts 110:3110:20,20 111:15111:16 112:16,25

melted 180:24member 58:21

104:14 138:22154:9 160:15,18173:5 183:11201:21 232:5236:1

members 158:11175:12 183:7,16

memory 108:4117:7 227:24

245:13,25mention 31:12

88:20mentioned 31:13

126:14 230:22merge 143:13merger 66:18

108:15 109:21,25110:10,11,17111:19 114:14,23117:18,25 118:8118:17 120:17125:11,12,15126:17,24 128:16129:2,3 149:7,10149:18 166:20167:2,3,8 168:7170:6,7 178:14,18191:5 238:23

merrill 92:1794:14

messrs 205:14met 11:14 47:10

242:1metering 245:13method 165:6methodologies

235:11,22methodology

44:21 102:18166:5,6,7 237:13

metric 189:16240:24

metrics 141:25189:18 211:22218:21 219:24220:8

mhuffman 3:10mic 55:5microgrid 51:19

mid 65:16 76:25middle 30:11

100:21,22midway 77:1migrated 173:16milestones 225:10mill 2:16 9:12miller 4:7 10:2,2

millions 43:14mind 142:24

145:18 158:12160:5 162:23

minus 122:2minute 195:17minutes 7:3,8,17

89:18 127:9,14128:1 186:24187:3,4,5,5,9195:8,14,15,18,19204:12 206:5219:10,13 221:8229:23 230:1,5,8

missed 51:1777:20,24 78:11191:18

misspoke 171:14model 79:12,13,19

80:20 81:5 83:12100:2,11,14101:12,15,18

102:6 129:24135:7 136:1,11,25137:4 138:16,21141:20 142:25143:2,4,4,6 146:14159:24 160:1,2165:17 215:16220:10 225:20,22225:22,24 226:3,6226:7,9,9,15,19227:9,21,22,23,25228:4,5 229:5,11230:18 231:21236:18 245:8,9

modeled 142:3,4,7142:10,14,17,22144:4 146:18147:3,4 155:18191:11 192:25

modeling 141:1147:6 213:21,23

models 227:8228:14,15 230:24232:4

modification241:7

modifications227:8 228:15

modify 226:10module 132:12modules 132:18moment 15:4 17:1

119:3 129:17147:11 168:13239:8

moments 41:14monetize 87:19

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month 26:1865:17 223:23

monthly 120:7months 112:2

113:18 118:24223:15

moore 3:14 9:2410:1,4

morning 9:3129:17 223:19

morphed 179:18motors 1:3 2:3

3:12 9:8move 63:12,21

96:5 116:5,24150:2 186:21209:15 211:2

moved 134:25148:3,8,17 150:13

moving 150:6170:18 211:2213:24

multibillion 36:143:16

multiple 25:1828:16 39:12 54:2156:7 80:4,5,1381:10 145:21,24172:16 242:1

multitude 48:7muse 52:15musk 10:11,16

11:11,13 26:2127:23,24,25 30:631:1,5,11 42:2143:2 45:16 66:467:23 71:15,19

72:10,17 73:1,1573:24 90:16 91:792:5 96:23 97:1,397:11,19 126:5,21141:10 148:2150:1 151:9 158:6159:12 160:10,17175:9 181:21182:25 198:5204:12 207:24208:2,5 209:6218:9 238:6

musk's 147:20myopic 113:17mystery 66:14mythology 180:22

n

n 5:1nail 141:23name 9:14 10:18

13:13 64:11248:21

named 28:16180:18

names 234:1nancy 13:8 22:1

22:19 23:3,9,10,1123:16,16,17 25:3,826:15 31:4 35:3,740:9,13 44:1,6,1244:20,23 45:8,1146:5 48:4 49:1449:23 55:2,7 57:158:1,10,13,1759:12,14,21 61:361:16 62:1,13,2163:8 66:5 96:18

nancy's 14:14,2322:9,22 23:1524:24 44:13 45:1450:1

near 89:8 95:4131:10 187:25

necessarily 20:11139:13 162:1189:11

necessary 161:16198:25

necessity 234:23need 53:19 68:2

81:12 143:20,20145:5,10 188:11188:13 191:12197:10 203:15219:18 224:16

needs 82:6,12 86:9negative 109:17

121:9 122:8 150:1190:12 192:1,3,4193:8,13 194:13194:14,14,15,21242:14

negotiate 58:25negotiating 98:3negotiation 98:10negotiations

100:22 109:18177:16

neighborhood36:24

neither 53:8 54:1968:17,21 71:1248:16

nem 75:9net 191:23 192:1

193:5 194:12,22195:5 242:14244:21,22,23245:13

network 32:647:19 52:14

neutral 179:20never 14:15 16:19

47:10 65:12 114:5115:10 120:11137:25 168:18226:25

new 3:18,18 13:1213:13,13 16:648:15,16 128:13133:22 140:14154:12 202:15233:3 240:22242:19 243:9,18243:23

nextracker 28:1951:12

nice 156:9night 184:4nine 186:17non 135:22 210:7

220:23 222:7,11222:25

normally 182:21note 53:13notes 87:2,2,8notices 86:25noting 186:17notion 47:16 101:5

154:16 155:22162:15 202:14207:20 231:23

notwithstanding139:15 156:12

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november 15:1432:21 152:8,16,22168:10

number 28:8 41:841:10,11 45:2447:8,9 48:6,9,1054:3 64:8 73:2198:11 100:17102:13,17,20105:13 116:18119:19,19 121:25123:15 128:23129:20 146:19155:18 166:12,13174:8 194:19199:11,14 200:11203:9 221:16,17223:23 227:14231:23 242:13244:4 246:23

numbered 48:23186:16

numbers 21:466:23 106:9 108:9115:18 119:17170:18,21 176:18176:19,22 190:6190:11 192:16,19193:9,13 195:5211:13 212:10

numerous 223:14223:24

ny 1:25

o

oath 157:4 248:7object 26:25 53:24

53:24 77:6 78:1483:24 87:16 90:8104:12 157:2197:12 198:10,21234:25

objection 16:122:23 27:7,1933:11 34:10 38:341:7 42:25 50:2054:12 56:18 57:2161:22 65:11 66:1075:12 81:19 85:288:9 91:8,21 92:793:23 98:7 99:11101:2 102:9109:22 110:6,23112:9,18 113:1116:10 119:10120:24 121:11123:9,24 126:7128:7 133:10148:6 150:4 153:9154:4,10 158:19160:21 162:6163:17 164:12165:25 166:8173:13 174:18177:5,11 178:11179:9 181:23189:13 192:9193:15 200:7,25203:18 208:19209:11 213:6216:17,24 218:12229:9

obligated 86:24198:23 199:4,5

obligations 70:1587:22,25 88:889:17 90:6,1591:6 92:6 122:13224:5 244:9

obvious 73:23obviously 84:6

129:6 147:8

occur 146:21october 96:16

97:16 118:19119:8 120:22167:14,19 169:7

offer 187:22 207:5240:3,9,12

offering 70:9,16office 143:21official 127:7ogin 51:13oh 20:20okay 10:24 12:11

12:16 22:11 24:626:14 28:21 34:439:4 45:23 51:2452:16 62:20 67:674:10 76:2 77:1881:23 90:19 94:1297:1 104:21 105:6106:21 107:21108:12 109:3110:15 113:24122:1,11,17127:22 132:7140:10 145:16148:12 152:24156:24 157:19159:1 166:17169:10 171:15176:21 177:9181:15 182:9184:2 185:13,20187:11 188:15189:23 190:20191:22 195:23202:23 203:3204:1 206:1216:10 221:11222:5 224:23228:3,17 230:10

239:16 244:7omit 50:14omitted 124:13

213:20omitting 242:24once 13:2 42:2

80:10 123:5 134:6165:7

one's 37:18 38:15132:18,20

ones 27:11 39:344:17 51:18 52:352:11 161:6235:23

ongoing 93:11196:3

ooo 4:10 5:5 8:78:12 247:5

op 215:24operate 100:25

101:15 102:5107:14 178:9,21179:5,8,19

operated 107:13171:19,21,23172:7,10 177:23

operates 16:10101:25

operating 96:1597:15 101:18103:6 143:16178:5,7

operational107:24

operationally135:3

operations 69:19107:25 218:6

opex 214:8 215:11225:5

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opinion 78:21178:20 239:1

opportunities36:12 79:9 144:17215:21

opportunity 38:20138:25 140:18142:9,18

opposite 155:13optimistic 158:10

159:16optimize 87:20options 166:2,3,5opx 51:14order 20:1 32:15

59:17 83:8 84:20102:19 106:8107:24,25 108:3108:11,16,22162:18,21 174:2190:17 222:23226:16 241:25242:7 247:1

org 136:7organizational

136:5 143:12original 144:21

148:22,23 184:22208:13 240:12245:25 248:13

originally 148:20230:25

originated 203:3,5

ought 73:14,19,20114:17 162:16

outcome 36:241:21 56:22 143:5159:7,10

outcomes 43:16output 225:11

outset 184:16,18outside 38:8 176:4

204:13,14 205:21outsized 36:13

39:11 43:12,23,2544:2

outstanding 87:8overall 40:5,6 89:9

103:13 113:4120:14 133:8216:13 218:23

overdrive 35:16overlap 40:11 56:7

56:11 234:18overview 221:3,23overviews 225:21owned 36:24ownership 21:18

26:24 234:17owns 72:1 142:20

p

p.m. 2:17 124:10124:12 125:1,4179:24 180:3237:25 238:3246:22 247:4

page 2:15 5:2,86:2 7:2 8:2 9:1215:18 22:6,7,2123:15 26:20 30:830:9 31:3,12,1334:5,12,13 35:1135:21,23 37:9

41:23 44:22 45:345:22 48:24 49:2554:2,3,3,5 86:5,888:10,22 89:12,20105:16 107:17115:15,16 119:3121:3,18,19122:21 123:14124:14 156:18168:6 169:22,23173:8 186:17194:11 210:13,13211:2,7,9,13,21,23212:1,2,12,14,18212:20 214:6,7215:2,11,20216:10 218:22219:2 221:2,6,13221:14,15,25222:2,3 224:21228:2,21 229:14229:14 233:20234:1 237:18241:4 243:12244:3,4

pages 5:13,16 6:176:21 29:6 33:1433:16 34:22 212:8

paid 72:2 81:1699:6 102:24127:10 194:24195:3,4

palo 2:16 9:1,12panasonic 134:14

134:16,25 135:7pandora 25:2 40:8

42:3 43:8,11 44:4pandora's 40:12panels 132:15

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paragraph 67:1868:1 75:8 87:9169:13 219:21

paragraphs 76:677:19,19

parallel 197:6parcel 123:7parse 49:17

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particular 31:1939:8 65:9 74:17108:21 130:12132:4,6,19 135:23138:8 157:20193:18 207:17212:20 228:16237:12

particularly 163:7189:10

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partner 10:21,2210:23 11:2 26:1028:10 57:6 59:2460:1

partnership 12:344:11 47:1 134:14135:1

parts 41:18 137:9235:6

path 36:4 40:2162:16

patrick 15:1433:13 37:9,1641:4 42:23

pattern 159:25160:1,2

pay 68:20,2369:14,18 70:571:5 83:16 85:1185:18 87:4 88:789:16 90:6,1591:5 92:6 97:9122:13 137:23,24175:10 217:21,24218:1,4 224:5

paying 83:1295:14 138:23142:24 146:23

pejoratize 16:14people 31:3 32:4

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people's 139:18perceived 38:7percent 13:18

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perfectly 224:23perform 19:2

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person's 175:5

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pertains 248:12pfund 13:8 49:14

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picking 140:24picture 30:7 45:14

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positive 179:8190:11 192:19193:21 242:14244:21,22,24

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power 183:9powered 145:2powergenix 51:13powerlight 28:19

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presupposing203:11

pretty 48:18 184:1244:8

previously 213:18price 21:15 37:14

37:22 39:13 58:2259:6,11 60:21102:23,25 110:18110:18 111:6127:10 138:23

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142:23,25 146:24232:7,10 234:19236:2,7 240:17

prices 21:2 117:25primus 51:13principal 86:13,20

87:1,4,7principals 32:5

48:15 51:8printout 5:15

48:22 49:5prior 13:10 14:22

14:23 16:4,1022:18 23:16,1725:5 28:9 48:1150:13,15 51:654:6 55:1,17,2064:7 110:11,17114:13,23 118:7120:17 166:19,20170:6 181:20182:18,21 185:5191:4,4 205:13248:7

prioritization164:20 166:14

privilege 53:24206:14 207:10

probability158:22

probably 12:2121:19 36:23 41:141:11,15 43:1848:7 70:21 71:4159:22 181:13184:11 198:16225:3

problem 93:19101:1

problematic 198:7242:21

procedures 53:22proceed 187:22proceeded 134:13proceedings 247:3

248:4,6,8,14process 66:13,14

96:6 100:9 101:9128:20 139:5197:22 198:20199:16,17,23,24205:15,21 206:1207:5 208:10

proclaiming141:10

procured 139:16procurement

140:18produce 139:2produced 145:12producing 145:9product 52:22

103:23 104:3133:25 134:1139:12,18 142:11144:13,24 145:14146:17 151:9153:13 154:14,17155:23,25 156:7157:15 159:7,10159:11 160:7,25161:4,6,7,10,12162:13,17,24163:24 165:1166:14 172:16225:11

production 134:21160:20

productize 140:8products 52:18

142:12 144:18145:22,24 146:2151:2,4 155:6

professional 10:1210:15 235:17

professionally29:2

profile 33:5 169:3170:2 171:8174:17,21

profit 20:1program 30:15

232:13,25 233:12234:14,24 235:15236:22 237:3

progress 174:25175:7

project 6:8 158:5180:12,18

projected 80:5215:12

projection 225:6projections 128:13

128:17 210:18227:11 230:13,17231:11,18

projects 158:2prominent 62:21

63:2promote 31:25promoting 46:24promotion 31:25prop 138:1proper 246:11proposed 73:16

182:8 199:18205:17

proposition 141:2

pros 185:9protective 247:1provide 34:8provided 108:13

108:23 175:25180:13 184:17187:7 220:22222:10 225:23226:3,5 228:9230:2 231:4,19238:7,22 239:5244:10

providing 135:18prowess 141:8

151:3proxy 85:22,23

86:3 88:6,1989:15,19,24 90:490:10 224:10,13224:19 225:16,19237:15

public 20:10 22:2223:2,3,8,24 24:2325:2,6,7,13,2026:1,2,5,8,11,1554:14 197:22,24210:6,7,9 220:23222:7,11,15,22,25232:7,9 233:5,8

publically 159:15publicly 34:16,24

141:13,15 207:6,6210:25 214:11

published 73:9pull 38:14 86:1

99:19purchase 74:8

81:25 179:3purchased 71:15

118:7 157:8

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purchases 72:2purchasing 215:25

purposes 148:4pursuant 86:24pursue 83:8 98:9

197:6pursuing 162:16pushback 56:15

56:19pushing 160:4put 11:5 32:14

33:14,15 34:2438:12 41:11 43:943:11 46:20 47:1650:13 125:12155:11 195:11212:9 237:1

puts 211:9putting 32:9 48:1

48:2 99:17 138:24139:18 142:11

q

quantify 133:20quarter 65:22

76:25 77:1 87:5quarters 12:22

65:22question 22:24

27:14 28:4 29:1230:22 32:12 46:2047:22 49:17 54:1958:16 61:10,13,1465:4,6 67:4 70:271:8 74:1 75:13

77:7,11,13 78:8,883:25 85:3 87:1288:2,3,5,17 89:589:10,14 90:1,2,2591:1,2,22 92:193:24 97:17,20,2198:8 99:12 104:6104:16 105:3109:6,23 111:8112:10,13,14,20114:15 119:11120:25 126:16127:6,19 130:5,23130:25 134:23135:10 137:2148:15 153:10154:1,6 155:14,14156:17,18,23157:3,4 160:4,8,22163:18 164:13,22165:19 166:9167:5 168:15169:21 171:19172:13 174:19,21174:23 178:6,16181:24 192:10193:6 197:13198:2,11,13,15,17198:22 199:9,12199:13 200:1,2,6,8200:9 201:25202:2,8 203:17,19204:16 206:22208:14,20 209:10209:13 213:7216:6,16,18219:16,20 223:4233:17 234:20,21235:1,19 236:13236:19 239:3240:16 246:15

questions 8:918:19 76:5 83:16101:13 198:1199:17 203:21206:4,8,19,23207:1,12,14,17,19207:24 208:2,5,9223:4 246:20

quick 63:11179:21

quickly 88:1289:21

quite 32:3 42:879:5 95:24 190:11

quote 73:10127:11 171:8

r

r 3:5r&d 135:15,18

151:17 152:12153:6

ra 169:13,17,18

raised 12:15 13:1917:7,8 18:1,1426:16 32:22 42:2369:24 70:9 81:1598:21 117:8,9

raising 29:2333:19,20,22 34:1846:11,12,16,24,2547:6 62:23 63:5

69:20 70:1,3,2280:16 82:20 85:1999:24 202:5

ran 27:25randall 3:4 9:19randyb 3:9range 21:17

115:17 214:21240:4,12

rate 175:24ratio 98:12 109:20

111:6,9 176:10,16176:18 177:1239:12,18,22241:7,9,14,16242:4,15,17 246:1246:8,14

rationale 131:7150:6,9,11 245:6

raw 151:18reach 31:14 38:5

225:6react 60:24read 58:5 75:20

76:4,20,22,23135:5 216:3 225:3234:1

reading 76:1578:4 87:23 187:8

ready 160:20real 38:20 47:21

62:23 98:1,2,15103:25 143:12212:15 229:12230:8

reality 42:15realize 126:4reallocation 136:2

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really 21:24 40:4104:3 123:7131:21 136:2154:1 156:2169:23 183:10186:3,19 204:21219:16,20

realreal 53:4reason 34:6,14

43:6 44:20 101:6104:17 126:3130:12,14 133:6137:20 150:13,15150:23 151:6192:7 230:7

reasons 41:19 48:8104:19 129:25130:2

recall 13:22 25:1626:8 36:21,2255:21,22 58:659:19 64:14 66:2269:15,24,25 70:7,870:10 71:22,2472:5,15 74:192:22 94:25 95:799:16 100:12,15100:17 101:16109:15 111:18114:6,7,20 116:17117:1 118:13119:1 120:8 121:1122:15 123:1124:4 125:23,25126:14,22 128:12128:18 129:5,11129:14 130:1,3,4,5130:9,19 134:8141:13,14 142:6147:10 148:7,22149:23 150:5,12

168:24 171:12,21173:15 174:4,6,8175:2 178:16,23178:24 181:25182:12 183:22184:10 185:10,19185:23,25 186:12189:17 190:1,14191:19,20 193:17194:17 195:24207:16 208:4209:24 210:21,24211:18,20,23,24211:24 212:6,8,16212:19,20 214:15214:17,24 215:1216:12 218:18,22220:25 224:22225:1,2,18 226:16226:21,24 227:2,4227:16 228:11229:22 230:23231:23 232:18237:11,20 240:25241:2,23 242:22243:5,11 246:18

receive 129:2received 74:6 75:3

123:8 175:12receiving 129:9

175:9 209:25recess 63:16

124:12 180:1238:1

recognize 15:1649:4 195:15 219:9219:13 220:19238:16

recognizes 62:17recognizing

190:15

recollection 59:1,770:17 72:19 74:1588:18 120:19129:8 143:3 168:9187:12,15 190:11191:6 210:8,12213:2 214:6 215:8216:3,7 220:6222:5 224:25230:11 242:25243:2 245:17

recommend177:21

recommending175:23

reconcile 212:11reconciled 170:10

170:20record 9:4 34:8,13

34:13,17,25 35:1,263:13,17 124:8,9125:3 179:23180:2 204:21237:21,24 238:2246:21,25 248:8248:11

recorded 1:142:14 9:6

records 92:9recusal 204:20recused 204:22redacted 205:13

206:5,13,13redirect 53:18reduce 103:24

111:14,15 241:16reduced 110:20

112:16,25 113:9113:11 232:14233:12 241:14242:15

reduction 113:20244:25

refer 17:19reference 16:8

17:21 23:14 155:7193:8 213:17214:8,9 240:6245:24

referenced 17:2022:15 24:4 59:25118:14 123:16155:6 156:13241:5

references 23:1523:19 42:12 89:12169:13,16 244:8

referencing 24:926:12 30:3 59:17112:5 118:1135:11,12 140:7152:16 176:20191:3 192:11204:21 211:14215:18 235:22

referred 17:558:17

referring 58:465:13 94:6 163:20169:12 205:5212:10 235:2

refinance 69:3217:6

refinement 245:4reflected 236:4reflects 37:7refresh 26:3 71:20

72:19 108:4 117:7118:22 147:16167:11 168:9174:3 175:4186:25 187:12,15

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213:2 214:23215:8 216:2,7222:5 226:12227:24 239:8245:13

refreshes 245:16refreshing 214:6

245:25regard 10:24

26:19 28:4 238:5regarding 59:21

74:8 160:19 164:5200:5 205:3245:12

regime 165:2,3regular 7:8 195:19regularly 82:15regulations 165:14

245:12regulators 162:21regulatory 161:16

161:22 162:4,10162:12,16,22163:3,6,10,25164:3,5,11,18,25165:2,3,18,22

reiterate 131:13146:13,15 224:20

reiterating 151:11relate 132:3related 25:5 46:6

72:10 90:16,2491:7 92:5 99:15113:4 126:21131:17 132:5146:3 188:3,13,15188:17 222:13

relates 135:20136:20 164:21191:10 199:15203:21

relating 130:11relation 116:2relations 168:2relationship 54:25

55:1 93:11relative 40:6 69:9

114:3 134:1145:25 159:21162:24 248:17

release 42:23relied 237:10remainder 12:14

12:14remained 144:14remains 227:13remember 26:18

39:16 60:18 65:17128:20 147:12158:8 159:17179:17 182:17,20186:12,14,17187:19 188:22,24189:14 194:4,19195:17 197:3210:23 215:19231:22 242:7,25243:19 244:11245:3,20

remembering240:1

remind 117:7125:15 187:8215:18

renewable 30:1230:20,23 32:7145:3

renewed 195:25196:2

repay 87:3repeat 75:13 79:15

109:6 112:21

130:21 166:24report 109:9reported 1:22reporter 2:19 9:16

10:7 18:20 70:2486:17 172:4236:12 248:2

reporting 243:7representation

188:5representatives

220:1represented

103:20 195:2representing

107:10reputation 33:4requested 248:15require 87:3required 39:9

162:10 199:1requires 38:10

165:18 225:5reread 86:18

residential 79:2resolve 120:16resources 134:24

135:12,14,15,18135:21 136:3,18136:24 137:6144:16 187:24

respect 86:2592:10 116:3

respective 49:19respond 41:4 58:1

58:15 60:24response 71:9

130:5 150:1responsive 199:2,6

199:12

restricted 100:2100:11 101:15,18102:6 104:24106:14,22,25

result 141:11142:8 144:18215:23 219:25225:8 241:8242:14 243:6

resulted 241:6,13242:3

resumed 125:6retained 107:18

246:24retrospect 38:19return 24:17

39:15,17 40:441:14 62:10193:25

returns 35:3,4,6,736:13 39:11 43:1243:25

revelation 154:12revenue 81:9

142:7,13 143:1,24143:25 144:1,3,8144:11,12,14,17145:18 146:5,20190:16 192:24,25213:19 214:2,9,13215:17

review 205:21242:2 246:7248:14

reviewed 205:14218:19 219:23240:7 241:11

reviews 49:6 76:186:4 169:11187:10 195:22215:6 219:15

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revised 110:2229:2 230:3239:22

revision 113:22230:4 240:21

revisions 170:18revolver 116:1

117:4 118:11223:13 224:2

revolving 96:1497:6,14 98:1799:10

rgrdlaw.com 3:93:10

ribbon 53:4rif 244:20right 13:23 30:2

30:13 33:6 34:1335:3 38:2 46:1652:5 61:1 67:2568:3 70:10,2377:12 83:13 85:1588:4 100:21107:21 121:13122:15 128:12129:9,20,25 132:1134:14 135:24136:7,9,24 141:22143:8 146:22163:6,24 165:9,16165:20 166:19172:8,23 193:14196:15,16 197:19206:1 217:14227:5 229:25235:13 241:10244:13 246:11

rightly 200:12ring 163:22ringo 57:5,25 58:9

58:13,17,18 60:14

61:2,15ringo's 57:8rise 37:22risk 92:17,25 93:5

93:6,7,12,17 94:194:5,7,8,14 117:3117:6 118:10127:4,12 128:5169:3 170:2 171:8

riskier 82:16rivance 26:10rive 31:5 67:20

71:15 227:20,20231:1,9

road 2:16 9:1236:12 145:1

roadster 159:19159:21

robbins 3:3 9:199:21

role 10:15 31:2359:2 64:12 67:10

roles 143:12,12roll 161:8rolling 212:12rollout 166:14rolls 212:13roof 103:4 104:4

130:16 131:17133:23 135:24136:1,17,22,25137:9,14,18,21,24137:24 138:6,17138:20 140:14143:2,5 147:17,18147:19,25 150:3150:16,17 151:10151:17 152:12153:2 155:4 156:7156:8,9,20 157:9158:17 160:12,19

161:15,18 163:11163:16 165:20,20165:23 181:2190:18 213:20214:3,5 230:12,19

roofs 135:8 136:10136:13 138:9148:3 163:4 164:6164:9 226:19,22227:1,2,20,23231:2,12

room 222:11,12,14222:21

round 39:8 46:25ruby 53:4rudman 3:3 9:20

9:22rules 202:7run 30:17 101:23

102:19 104:23175:25

s

s 5:6 6:1 7:1 8:1159:24

sagisi 5:10 15:1433:13

sales 67:11 76:1576:23 77:14 78:2179:19 95:2,3,9,995:17,17 102:16102:17 103:19,23103:24 138:7139:5,19

salesman 79:13salespeople 79:21salesperson 79:18san 3:7satisfy 87:25

saved 85:1 126:20savings 215:12

244:23 245:7saw 43:18 128:23

226:25 227:22saying 16:14 37:19

37:24 62:12 67:1474:1 84:3 87:1489:18 93:21 121:5126:12 130:6135:17,20 141:13150:12 151:9183:14 202:1206:7,10,19 208:9214:3 215:14216:2 218:14,17240:15

says 48:25 67:2575:16 76:8 77:1878:17 89:17105:13 116:1,23119:24,25 121:16152:10,16 168:6,7169:9,25 185:15187:13,14,21188:23 193:13205:14 213:24215:11,12,22219:14,22 221:3221:25 223:6,24225:4 226:7227:20 229:1245:12

scale 133:25139:21 151:4153:14,22,23154:13,17 155:5

scaling 155:2,3156:3

scenario 127:5,13128:6,21

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scenarios 128:21scheduled 148:21sciences 53:4scratch 226:10se 18:2 69:8 74:4

82:5 93:8 95:2129:12 141:15186:14 194:6195:5 200:14246:5

seat 58:2,11 59:1359:21 61:4,1662:2,14,22

second 15:1844:13 87:9 105:16107:17 115:15169:5,23 216:15237:22

secondary 20:9secretary 30:10section 52:17

205:12sector 29:18,19,20securitization 90:7see 15:21 21:9,15

32:17 35:18 40:2548:12 58:3 59:1660:16 64:19,23,2467:6,13,16,25 68:468:5 69:1 75:1676:7 86:8 91:1894:1 105:16,19107:16 115:18,22116:1,6 119:5,9,17119:23,24,25121:13,15,16,17121:23,25 122:6124:13 127:25129:7 135:2152:10,14,24165:7,22 168:12

169:4,25 170:3,9179:22 184:10186:24 190:23191:14,16 210:15211:3,4,9,24 212:2216:15 219:14221:2,19,22 222:2223:5,9,11,16224:2 225:4,13,20225:21,25 228:4,5228:10,17 229:1,3229:14 239:14

seeing 75:19119:12 122:6124:2 148:9157:14 191:20227:2

seeking 98:22seeks 70:24 86:17seen 64:15 65:12

76:13 115:10120:11 127:14167:13 168:15,17168:18,22 175:1,2187:4 191:1235:12

segmentation164:21 166:18

select 215:13sell 20:8 72:10selling 95:21,24

103:23 139:6,12144:18 215:20235:24

senay 6:15 167:20168:3

sending 37:992:25 93:4

senior 87:2sense 31:20 108:6

185:4,5

sensitivities100:24 105:14

sensitivity 101:5229:2,18 230:3

sensitizing 229:6sent 34:1 64:10

92:17 93:2,6,2194:14 106:4 184:3

sentence 205:13separate 84:17

97:20 107:14142:17 143:20144:15 160:4,18168:17 172:13,20172:24 173:2244:18

separately 101:23143:17

september 5:2137:21 64:1 65:1466:17,19 119:8168:8 169:10170:17

serial 28:15serra 64:8,10,19

65:23 67:14 75:175:8,16,24

serra's 66:2serves 33:10services 52:19,22session 125:1set 12:8 26:11 44:9

69:16 71:16 81:1485:13 89:6,7,2490:21,23 98:9100:18 101:7,19102:3,18 104:19107:3,10 108:9,23111:10,23 124:3128:13,16 173:17179:14 194:7

207:8,9 211:22222:14 227:11228:8 231:18248:5

sets 143:17settle 86:24settled 86:16,23seven 22:8,16

23:20 123:4,4sfdepo 4:5share 85:21

190:24 191:2218:21 219:24220:3,7

shareholder 27:24126:10 148:4,17148:19,21 149:6,8149:11,13 201:2201:11 234:5

shareholders85:21 126:9147:21,23 149:17152:20 233:21,22234:3,4

shares 20:8 37:1837:21 39:19

sharing 215:24sheet 84:14,20

101:25 121:10,24shift 79:2shifting 145:4shirt 146:4short 70:12shorthand 2:19

10:7 248:1,9shortly 152:19,20show 48:21 60:7

63:25 89:24 105:5167:12 175:4192:16 218:15232:11

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showed 104:24107:4 108:14182:14 190:23191:15,25 192:3212:24 243:9

showing 15:1260:12 74:25105:11 122:8123:11,18 124:5152:7 167:18180:11 187:3194:12 195:14209:21 238:14

shows 30:7 38:2338:25,25 39:5,7119:22 123:4192:15,17,22193:3 211:13,15212:25

shugar 28:16,2229:1,2

shugar's 28:22shy 193:4sic 58:13 86:5

108:14 116:9163:10 171:7204:12 228:21

side 58:25 79:10100:6 115:24118:15 121:14128:22,23 129:13135:12 136:17,23138:14,17,20140:2 142:7,8,8,13143:1 155:7,8156:14 195:2242:20,21 245:5

sided 48:24signature 248:24signed 108:16

109:21,25 110:11

110:12,14,14111:20 117:19125:12,16 126:17128:15 129:2149:10

significance240:25

significant 10:1110:15 33:17 42:2243:22 44:2,16,1746:4 92:23 94:20195:2 211:15225:5,7

significantly 57:10116:5,24 224:14

signing 110:17118:8 149:6,7166:20 167:3,8191:5

silence 184:8silevo 132:7,10,23

132:25 133:1,17133:23 134:4,9,20134:22 135:1,18135:22 136:13,23137:16 139:15140:23 225:4

similar 26:23,24123:22 140:4244:8

similarly 109:3160:2 234:21

simple 30:22 70:277:4 78:9 92:1104:6,6 154:1198:2,15 200:2216:6 219:20

simplify 44:11104:15

simplistic 140:11

simply 43:1561:14 77:13 90:3125:12 156:19184:25

simultaneous 99:2simultaneously

98:22 99:1

sit 136:9 156:10184:8 226:13,14229:13,21 242:5

site 51:6sitting 120:8

179:11 187:18210:21 214:24227:13 230:7232:5,17 237:14241:23

situation 104:24situations 38:21siva 51:12six 48:24 113:18size 104:11 155:5sleeving 134:9slide 33:16 34:25

36:6 37:25 38:538:23 41:17 43:945:13 122:9185:24 188:23,23192:12,15 193:17

slides 193:19

small 36:25,25solar 73:6,10,19

73:19,20 74:5,1776:12 78:18,2298:20,23 99:3,5,16102:8,13,15,19

103:4 104:4 117:8117:9,10,21 118:2118:7 129:16130:7,11,13,16131:17 132:15133:23 134:24135:8,12,21,23,24136:1,10,12,15,16136:18,22,25137:6,7,9,10,14,18137:21,24 138:6138:17,20 140:14140:14 143:2,5145:7,9,17 146:7147:17,18,19,25148:3 150:3,16,17150:19 151:10,17152:12 153:2155:4 156:7,9,20157:9 158:17160:12,19 161:15161:18 163:4,5164:5,9 173:2181:19 184:19,20184:23 185:8188:16,18 190:18194:25 195:7196:4,20,23200:19 203:6213:20 214:3,5218:24 226:19,22227:1,2,20,23230:12,19 231:2231:11,25 232:1,1232:20 233:23

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solarcity's 79:2,1887:12 96:10106:17,18 107:12107:13 108:25115:23 120:10,10122:7 127:14132:19 166:10174:21 220:9

sold 20:5sole 44:8solely 228:12solution 127:3,11

128:5 145:11solutions 4:2

51:19 246:24solve 117:24

122:20 125:10solved 99:16,18

208:17solvency 84:16

85:6solvent 83:22 84:4

84:9,11,13,25,2585:12

solving 208:22209:8

somebody 34:791:3 106:24172:11 183:22184:2,5 185:14200:21 201:5230:11,20

sonsini 205:14,20

230:12 240:12sort 20:2 21:24,25

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Federal Rules of Civil Procedure

Rule 30

(e) Review By the Witness; Changes.

(1) Review; Statement of Changes. On request by the

deponent or a party before the deposition is

completed, the deponent must be allowed 30 days

after being notified by the officer that the

transcript or recording is available in which:

(A) to review the transcript or recording; and

(B) if there are changes in form or substance, to

sign a statement listing the changes and the

reasons for making them.

(2) Changes Indicated in the Officer's Certificate.

The officer must note in the certificate prescribed

by Rule 30(f)(1) whether a review was requested

and, if so, must attach any changes the deponent

makes during the 30-day period.

DISCLAIMER: THE FOREGOING FEDERAL PROCEDURE RULES

ARE PROVIDED FOR INFORMATIONAL PURPOSES ONLY.

THE ABOVE RULES ARE CURRENT AS OF APRIL 1,

2019. PLEASE REFER TO THE APPLICABLE FEDERAL RULES

OF CIVIL PROCEDURE FOR UP-TO-DATE INFORMATION.

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confidentiality and security policies and practices

should be directed to Veritext's Client Services

Associates indicated on the cover of this document or

at www.veritext.com.

plainsite - wordpress.com...7 exhibit 7 lazard presentation entitled, 115 8 project daedalus; bates...

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