Elon Musk’s $45bn pay package approved by Tesla shareholders

Tesla Shareholders Approve $45 Billion Pay Deal for Elon Musk

After a fiercely contested referendum on his leadership, Tesla shareholders have given the green light to a $45 billion pay package for CEO Elon Musk.

Victory for Musk and Tesla Board

Following a Delaware judge’s nullification of Musk’s initial $56 billion payment, the successful vote serves as a victory for Musk and the Tesla board. They campaigned ardently for the deal’s approval to counter the judge’s ruling.

Implications of the Vote

The outcome of the vote does not guarantee immediate payment to Musk. Legal disputes are likely to arise regarding the independence of the board and the fairness of the package, as per the judge’s previous ruling.

Shareholder Opinions

Prominent shareholders like Norway’s sovereign wealth fund and the California State Teachers’ Retirement System opposed the payment. Proxy advisory firms Glass Lewis and Institutional Shareholder Services also took a stand against the award.

Potential Legal Battles

New lawsuits may emerge post-vote, leading to prolonged legal battles. Shareholders also approved a move to shift Tesla’s legal headquarters from Delaware to Texas, adding another layer of complexity to any challenges.

Background of Musk’s Payment Package

The payment package for Musk was initially crafted in 2017, with conditions tied to revenue and market targets. Despite approval by shareholders in 2018, legal challenges arose, culminating in the recent vote.

Response to Judge’s Decision

Judge Kathaleen McCormick criticized Tesla’s board for a flawed process in determining Musk’s payment. The board aims to challenge her ruling through the shareholder vote, maintaining the package despite a decreased value due to Tesla’s share price decline.

Read More of this Story at www.theguardian.com – 2024-06-14 01:30:00

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