A Delaware judge has overturned Ilon Musk's record $56 billion compensation. In his opinion, the amount of compensation is unthinkable and unfair to shareholders. The billionaire may appeal the decision.
6 years ago, Musk as CEO and Tesla entered into a 10-year agreement under which Musk received options for about 304 million shares at a price of $23.33 apiece. Based on Tuesday's closing price of $191.59, that translates to a reward of about $51 billion, including Musk's costs to exercise the options. The bonus was the largest in the history of publicly traded companies.
According to the judge, the terms of remuneration were agreed with directors who were dependent on Musk, i.e. conditionally speaking, the businessman wrote the bonus to himself through the controlled top management. The size of this bonus is about a quarter of the total fortune of Musk, who is considered to be the richest man in the world at the moment. After the court decision became known to the public, Tesla's securities fell by about 3%.
It is worth noting that the legal battle was started not by simple "retail" investors, but by institutional companies that own more than 40% of the stake. Fortunately, the lawsuit was successful, and now Tesla will continue to tell workers that there is simply no money to increase their pay.
UPD
Tesla is recalling nearly 2.2 million vehicles, almost all of the cars it sold in the U.S., because the font size on the dashboard is too small for the brake, parking and anti-lock brake system warning lights.
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Appalling Court interference in the management of one of the most successful companies on earth.
This entirely politically motivated decision by a biased, woke, Biden crime family associated judge has discredited Delaware as a preferred jurisdiction of incorporation for companies.
Companies are already leaving Delaware, led by Tesla.
Thanks for your point of view!
I think America has damaged its credibility for investment since the seizure of Russian assets. But that's the Russians, they are far away.
Musk seems to be not the last American citizen, a wake-up call.