Record bonus package for Elon Musk: Tesla shareholders approve $44.9 billion bonus despite court injunction
Shareholders of US carmaker Tesla on Thursday approved a record $44.9 billion (about one trillion kronor) pay package for CEO Elon Musk, the AP reported.
The decision came after a deal struck in 2018 was overturned by a Delaware court earlier this year. The exact number of votes was not immediately announced. According to the AP, approval of the reward does not mean Musk will receive the full amount immediately. The package is likely to be the subject of a hearing in Delaware court for several more months, where Tesla is appealing the rejection, the AP reports.
Before the drop in stock value, the compensation package was worth $56 billion; now it is worth $44.9 billion, according to the AP. Shareholders also approved a proposal to move the company’s legal headquarters from Delaware to Texas and other proposals, including the re-election of two board members: Musk’s brother Kimbal Musk and James Murdoch, son of media mogul Rupert Murdoch, Reuters reports.
Judge Kathaleen McCormick of the state of Delaware in January rejected the deal on Musk’s compensation, saying it was unfair to shareholders. The verdict was the result of a lawsuit by a shareholder who claimed the amount of the bonuses was excessive. The deal represented the largest compensation package any company in the United States had ever planned to pay its boss. The bonuses were to be paid in stages as targets were met.
The lawsuit alleged that Tesla misled investors by suggesting that it was very difficult to meet its targets, when in fact, according to the lawsuit, that was not the case. Among the performance goals that had to be met were certain levels of profitability for the company and its stock price on the stock market.
Tesla said it would appeal the court decision, but asked shareholders to re-approve the package at Thursday’s annual meeting in Austin, Texas.
Photo source: www.pexels.com
Author of this article
WAS THIS ARTICLE HELPFUL?
Support us to keep up the good work and to provide you even better content. Your donations will be used to help students get access to quality content for free and pay our contributors’ salaries, who work hard to create this website content! Thank you for all your support!
OR CONTINUE READING