Elon Musk’s attorneys: Musk compensation plan does not affect investors

xAI and Tesla CEO Elon Musk is hoping a years-long legal battle over his record $56 billion pay package from Tesla comes to an end on ￰0￱ attorneys are set to appear before the Delaware Supreme Court to plead for the reinstatement of the compensation plan rescinded two years ago by a lower court ruling in ￰1￱ Tesla CEO appealed the ruling on his 2018 compensation plan approved by Tesla shareholders, to reward him only if the company hit ambitious growth ￰2￱ seen on court filings, the structure consisted entirely of Tesla’s stock market value and operational ￰3￱ Musk’s attorneys: Musk compensation plan does not affect investors According to Tesla’s lawyers, the package was fair, and it motivated Musk to fight for the company’s success and, by extension, its shareholders’ profits.

“Against all odds and with many betting against him, Musk grew Tesla’s value by roughly 1,400%, with stockholders keeping more than 90% of that explosive growth,” the company’s legal team wrote in one filing. Delaware’s Court of Chancery Judge Kathaleen McCormick crushed the CEO’s compensation dreams by ruling in favor of Tesla shareholder Richard Tornetta in 2023, who had sued to block the plan years ￰4￱ owned just nine Tesla shares at the time of the lawsuit, but accused Musk and the board of violating their fiduciary duty to act in the best interests of the company and its shareholders. Tornetta’s 2018 lawsuit alleged that Musk exerted outsized control over Tesla’s board, influencing the decision to grant him a pay deal that was “unfathomable” in ￰5￱ claimed that directors were not truly independent and failed to negotiate on behalf of ￰6￱ case was filed when Tesla was still incorporated in ￰7￱ McCormick sided with Tornetta, finding that Musk’s influence over the board undermined the fairness of the ￰8￱ ordered Tesla to revoke the $56 billion plan and draft a new compensation package in tandem with fairness ￰9￱ resubmitted the same pay structure to shareholders in 2024, where it passed again by a large majority.

McCormick, however, rejected the second vote, saying it did not qualify as a new plan under her ￰10￱ appeal before Delaware Supreme Court closes in Delaware’s Supreme Court five-justice panel will review both the lower court’s decision and the related $345 million legal fee McCormick awarded to Tornetta’s ￰11￱ justices will have to determine whether the package represented a legitimate corporate move or reflected undue influence and inadequate ￰12￱ the court finds the decision was fairly made, it will likely reinstate the ￰13￱ not, it could affirm the ruling that struck it down in ￰14￱ has already agreed to a replacement deal reached in August if Musk loses the appeal, where the billionaire could still receive tens of billions of dollars in stock ￰15￱ McCormick’s decision, several companies, including Tesla itself, Dropbox, and Andreessen Horowitz, moved their corporate registration from Delaware to states like Texas and Nevada, where shareholders are not quite successful in challenging board ￰16￱ “Dexit” exodus prompted Delaware lawmakers to amend corporate statutes to prevent companies from bidding bye to the US State.

“There have been a string of decisions in Delaware Chancery Court that have begun to shake the faith of the corporate folks who are incorporated there in Delaware,” said Beth Boland, a partner with Wisconsin-based firm Foley and ￰17￱ other related news, Tesla’s board has proposed a new long-term compensation package for Musk that, if fully realized, could make him the world’s first ￰18￱ proposal is almost similar to the structure of the 2018 deal of stock-based and entirely contingent on performance targets, but introduces new targets tied to Tesla’s business ￰19￱ of the benchmarks Musk has been tasked with improving are the number of subscribers to Tesla’s “Full Self-Driving (Supervised)” software, the deployment of robotaxis, and the company’s overall financial ￰20￱ are set to vote on this new plan at Tesla’s annual meeting on November ￰21￱ to a Reuters analysis , Musk could still earn billions under the plan even if some of the company’s most ambitious technological goals, like achieving fully autonomous driving, are not ￰22￱ up to $30,050 in trading rewards when you join Bybit today