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14 June 2024
Elizabeth Pfeuti
Tesla shareholders approve Musk’s huge pay day
June 14, 2024
Tesla shareholders have approved CEO Elon Musk’s $56 billion pay package – the largest in US corporate history – after it was rescinded by a Delaware court in January.
The controversial stock option pay package was awarded to Musk after being approved by 73% of shareholders at an AGM in 2018.
However, a shareholder later sued, alleging concerns about the independence of Tesla’s board.
In January, a Delaware judge agreed, ruling against the pay package and criticising Musk’s “extensive ties” with Tesla board members.
But shareholders threw their weight behind Musk at the company’s AGM on July 13, voting once again in favour of Musk’s mammoth pay day.
The vote does not supersede the court’s decision to void the pay package. However, it will strengthen Tesla’s argument as the company attempts to have the decision overturned in court.
Shareholders also voted in favour of having Tesla reincorporated in Texas, widely considered a move aimed at protecting Musk’s pay should the Delaware legal system stand by its previous judgment.
“Hot damn I love you guys,” Musk said to an audience of retail investors after the polls closed, per the Financial Times.
“We have the most awesome shareholder base of any public company… We are not starting a new chapter, but opening a new book.”
However, it hasn’t all been smooth sailing.
Previously, it was reported that about 3% of Tesla’s shareholders, who hold nearly $17 billion worth of shares, would struggle to vote at Tesla’s AGM due to being based internationally.
Additionally, Tesla’s stock price has fallen by about 29% in the past year as it loses ground compared to its fellow Magnificent Seven tech giants, Microsoft and Nvidia.
The decline means Musk’s stock options are now worth about $48 billion, compared with the $56 billion they were worth previously, FT reported.
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