Musk's electric car company Tesla is being sued by JPMorgan Chase for $162.2 million for "flagrantly" breaching a contract related to stock warrants after its share price skyrocketed, according to the lawsuit filed on Monday.

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 Tesla sold warrants to JPMorgan Chase in 2014 that would pay out if their "strike value" was lower than the current share price in June and July 2021.

Musk's August 7, 2018, tweet that he might take Tesla private at $420 per share and had "funding secured" prompted JPMorgan to significantly lower its stockholders' strike price, which JPMorgan then reversed some of when Musk dropped his plan 17 days later

It was only when Tesla's share price had risen by about 10 times that JPMorgan said that Tesla had to fulfil its contract and deliver stock or cash. In the bank's view, Tesla had defaulted because it had not met its obligations.

"Tesla has flagrantly ignored its clear contractual obligation to pay JPMorgan in full," the complaint stated. "JPMorgan's adjustments were appropriate and contractually required."

Due in part to a separate convertible bond sale and reduced federal income taxes, Tesla sold the warrants, the complaint states.

Following "significant corporate transactions involving Tesla," JPMorgan said it was contractually entitled to adjust the terms of the warrants.

"The bank's adjustments were an opportunistic attempt to take advantage of changes in volatility in Tesla's stock," Tesla complained to JPMorgan in February 2019, but it did not challenge the underlying calculations.

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