Tesla to ask investors to revive $55-bn package for Musk denied by judge
Tesla will ask shareholders to reinstate a compensation package for CEO Elon Musk potentially worth $55 billion that was rejected by a judge in Delaware this year and to move the electric carmaker’s corporate home from Delaware to Texas.
In a ling with federal regulators early Wednesday, the company said it would ask shareholders to vote on both issues during its annual meeting in June.
In January, Chancellor Kathaleen St. Jude McCormick ruled that Mr. Musk is not entitled to a landmark compensation package awarded by Tesla’s board
A judge ruled Mr. Musk is not entitled to a landmark pay package awarded by Tesla’s board.
of directors.
Five years ago, a Tesla shareholder lawsuit alleged the pay package should be voided because it was dictated by Mr. Musk and was the product of sham negotiations with directors
who were not independent of him.
It may be a tough sell for Tesla and Mr. Musk in June. Shares of Tesla Inc. have tumbled nearly 40% this year as global demand for electric vehicles fades and
Tesla sales have fallen rapidly. Mr. Musk said a month after the judge’s ruling that he would try to move Tesla’s corporate listing to Texas, where he has already moved company headquarters.
Moves Neuralink
Almost immediately after the judge’s ruling, Mr. Musk did exactly that with Neuralink, his brain implant company, moving its corporate home from Delaware to Nevada.
In a letter to shareholders, Chairperson Robyn Denholm said that Mr. Musk has delivered on the growth it was looking for at the automaker, with Tesla meeting all of the 2018 CEO pay package targets.