Tesla shareholders have already voted in favor of the payment package twice
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by Brad Anderson
March 13, 2025 at 09:40
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- Musk’s call aims to restore his salary of $ 56 billion and to avoid a charge of $ 25 billion.
- An American judge has twice rejected his record compensation for musk.
- The richest man in the world could receive options to buy around 303 million Tesla shares.
Elon Musk could be concerned with trying to shrink the federal workforce and solve America’s problems through Doge, but he has always found the time to call on the rejection of his Tesla remuneration set of $ 56 billion – something that a federal judge killed at the end of last year. Musk, the richest man in the world (in case you forgot), says Chancellor Kathaleen McCormick has made a series of legal missteps to block her pay check.
In 2018, Musk decided not to have a salary in Tesla. Instead, he concluded an agreement to buy around 303 million Tesla shares at $ 23 each if the company has achieved certain performance and evaluation objectives. The automaker has struck each of these targets. But in January 2024, McCormick canceled the remuneration package, arguing that the members of the Tesla board of directors who approved it were essentially liable to Musk.
More: Trump promises to buy a Tesla after the boycott brand of “Radical Left Lunatics”
A few months later, Tesla shareholders had a second chance to weigh on Musk’s compensation. Unsurprisingly, they voted massively to restore it. However, McCormick quickly killed this, blocking the package for the second time.
In his latest call to restore the package, Musk, as well as other defendants, argues that McCormick wrongly applied the legal standard of “all equity” when examining the agreement. They argue that she wrongly concluded that the participation of 21.9% of Musk in Tesla gave him de facto check on the remuneration negotiations. Musk also affirms that the judge misinterpreted the relations between the directors of Tesla, suggesting that they were in conflict during the decision -making process.
Defense of Musk: “Common Sense, please”
In the call thesis, the Musk team declares: “This counter-intuitive result defies the established principles of the law of Delaware, good corporate governance and common sense”, according to Reuters. “Musk had less than a quarter of Tesla’s actions, did not have the power to dictate the terms on the board of directors and did nothing to dominate or force the administrators during the transaction.”
Tesla warned that the development of a new equal value remuneration plan could cost a fee of 25 billion dollars, Reuters Reports. The company maintains that this makes Musk’s call crucial both to restore its compensation and keep its attention on Tesla.
When the judge blocked the salary package for the second time last year, she said that Tesla’s declaration to shareholders encouraging them to restore wages contained false complaints, invalidating the vote.
“The multiple material anomalies of the proxy declaration concerning the effect of the shareholders’ vote, ironically, independently prohibit this vote of the effect of ratification,” said the judge in his decision.
