In 2018, Elon Musk negotiated his bonuses for the coming years – some of which had almost unrealistically high targets at the time. But these were achieved – and at least theoretically, Tesla now owes the boss tens of billions.
Tesla shareholders have once again approved a huge share package worth several dozen billion dollars for company boss Elon Musk. The compensation plan, originally approved in 2018, was overturned by a US court in January.
The new vote does not mean that Musk will automatically receive the share package. But it does improve his chances of getting it. Shareholders also voted to move Tesla’s registered office from the US state of Delaware to Texas, as the company announced at its annual general meeting on Thursday.
Delaware judge prevents record payment to Elon Musk
In the first vote in 2018, the share package received a majority of 73 percent. But then a shareholder filed suit against it – and in the end a judge in Delaware torpedoed the plan.
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She concluded that Musk had too much influence behind the scenes in the negotiations over the generous compensation of the Tesla board of directors to be able to speak of a fair process. Since the shareholders were kept in the dark about the entanglements, they had no opportunity to make a well-considered decision, the judge argued.
At the time, Musk was granted the right to receive a good 300 million Tesla shares at the 2018 price in small instalments if the company met some ambitious goals over a period of up to ten years.
Tesla still in court
Among other things, the market value was to rise from a good 50 billion dollars to 650 billion dollars. Based on this target, the value of the package was once estimated at around 56 billion dollars. But share prices fluctuate.
After rapid growth and thanks to the electric car euphoria at the time, Tesla quickly reached the mark and was at times even worth more than a trillion dollars – and Musk’s compensation package was around 100 billion dollars. In the meantime, demand has cooled noticeably and Tesla is now worth around 580 billion dollars on the stock market.
In recent months, Musk had suggested that he could push forward the development of artificial intelligence applications elsewhere if he did not gain more control of Tesla. This triggered a new investor lawsuit in Delaware on Thursday.
Source: Stern
I’m a recent graduate of the University of Missouri with a degree in journalism. I started working as a news reporter for 24 Hours World about two years ago, and I’ve been writing articles ever since. My main focus is automotive news, but I’ve also written about politics, lifestyle, and entertainment.
