Elon Musk, the CEO of Tesla, has received approval from shareholders for a historic compensation deal worth up to $56 billion. This deal, which had been previously blocked by a judge in Delaware, was backed by enthusiastic shareholders at the firm’s annual meeting in Texas.
During the meeting, Mr. Musk expressed his gratitude to shareholders, exclaiming, “Hot damn, I love you guys!” The compensation package is more than 3,000 times what the highest-earning CEO in the US made last year. However, legal experts have pointed out that the vote is not binding, and it remains to be seen if the court will accept the re-vote and allow the company to proceed with the payout.
The massive sum had raised concerns about Tesla’s board’s close relationship with Mr. Musk, with the Delaware judge ruling the package as “unfair” due to a flawed decision-making process dominated by Mr. Musk’s influence. The decision to move the company’s legal headquarters to Texas came after the Delaware court voided the pay package, siding with an investor who had sued over the deal.
The fight over the compensation plan had highlighted concerns about Mr. Musk’s leadership, particularly as Tesla’s share price had declined. Despite this, Mr. Musk garnered strong support from individual investors in favor of the deal. The compensation plan entails Mr. Musk receiving rights to approximately 300 million shares, equivalent to a 10% stake in the company, based on Tesla meeting specific goals related to sales, profits, and share price.
The company defended Mr. Musk’s compensation, citing his instrumental role in achieving Tesla’s targets and ensuring his continued dedication to the company. Industry analysts have expressed mixed opinions on the deal, with some acknowledging Tesla’s remarkable stock performance under Mr. Musk’s leadership.
Following the shareholders’ approval, Tesla’s board confirmed Mr. Musk’s importance to the company’s success and his relentless drive as a leader. In a show of appreciation, Mr. Musk promised a personal tour of Tesla’s factory in Texas to select shareholders who participated in the vote.
Additionally, shareholders re-elected two board members, James Murdoch and Kimbal Musk, at the meeting. The outcome of the vote serves as a strong validation of Mr. Musk’s leadership and vision for Tesla’s future success.
Overall, the approval of the record-breaking compensation deal reflects the confidence and support of Tesla shareholders in Elon Musk’s leadership and the company’s growth trajectory. The decision to move the legal headquarters to Texas signals a new chapter for Tesla as it navigates challenges and opportunities in the electric car industry. With Mr. Musk at the helm, Tesla continues to push boundaries and redefine the automotive landscape.