Pay Package Approved - Tesla Shareholders Vote Yes For Elon Musk's $56 Billion pay day
A Deal Is A Deal: Tesla Shareholders Ratify $56 Billion Pay Day For Elon Musk
Industry News

He came, he strategised, and he delivered. Elon Musk’s $56 billion payday has been overwhelmingly approved by Tesla shareholders, despite a judge in Delaware intervening to halt Musk from receiving his pre-approved pay package. Tesla’s legal address is in Delaware, but following the legal intervention, which independent observers say was politically motivated, shareholders also approved a motion to relocate Tesla’s legal residency from Delaware to Texas.

There could still be legal issues with the pay package despite the apparent positive shareholder vote. The compensation package may still be deemed illegal. In the lead-up to the stockholders’ meeting, Tesla made a final push to persuade shareholders to vote in favor of Musk’s compensation package and the reincorporation in Texas.

Judge Kathleen McCormick of Delaware’s Court of Chancery ruled the sum excessive and criticized the board of directors for lacking sufficient independence from Musk. However, the stock-based compensation package for Musk was approved by shareholders in 2018 but voided by a court in January.

Investment funds have been vocal about their stances on the pay package, both for and against. Proponents argue that Musk met the difficult financial and operational goals set in the compensation package. Opponents cite the unprecedented size of the award and Musk’s distraction with his other companies.

Norway’s $1.7 trillion wealth fund announced on June 8 that it was voting against the package. The Norges Bank Investment Management voted against the original 2018 award. Similarly, the California Public Employees’ Retirement System, commonly known as CalPERS, declared it would vote against the package.

In contrast, Scottish asset manager Baillie Gifford, one of Tesla’s longest-standing shareholders, planned to vote in favor of the compensation package, according to a June report.

Pay Package Approved - Tesla Shareholders Vote Yes For Elon Musk's $56 Billion pay day
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