Elon Musk, the CEO of Tesla, has successfully secured shareholder approval for his record-breaking $56 billion compensation package at the company’s annual meeting in Texas. Tesla shareholders also approved the decision to move the company’s incorporation state from Delaware to Texas. The compensation package, which was first awarded in 2018 and later voided by a Delaware judge, was valued at roughly $48 billion. Musk expressed his gratitude to shareholders, saying, ‘Hot damn, I love you guys.’ The approval comes after a legal battle earlier this year that led to the compensation package being reduced in value. The sheer size of the package, which comprises 303 million stock options, represents a significant portion of Musk’s net worth, estimated at $212.8 billion by Forbes.
The recent shareholder vote, while symbolic, does not guarantee that Musk will receive the $56 billion payout. The final decision still rests with the Delaware judge who voided the package earlier this year. Shareholders and critics have raised concerns about Musk’s divided attention, given his involvement in multiple companies. In the weeks leading up to the vote, Musk and his supporters launched advertising campaigns to gather shareholder support, including engaging with them on social media platform X.
The legal battle surrounding Musk’s compensation is far from over, as shareholders may challenge the recent approval. Tesla’s hopes to leverage the shareholder vote to challenge the earlier court ruling. The approval of the compensation package also raises questions about Musk’s commitment amidst his various roles and ventures. While the outcome of the shareholder vote provides a vote of confidence in Musk, the legal battle over his compensation remains ongoing. The annual meeting also saw the approval of other shareholder proposals, including reducing director terms to one year and introducing simple majority voting provisions in Tesla’s governing documents.
