Tesla has asked its shareholders to approve CEO Elon Musk’s controversial $56 billion pay package, which was originally set in 2018 but was rejected by a Delaware judge earlier this year. The compensation plan, which includes no salary or cash bonus, is based on Tesla’s market value reaching up to $650 billion over the next decade. Currently, Tesla is valued at $500.36 billion.
The pay package was rejected by Delaware’s Court of Chancery in January, with Judge Kathaleen McCormick calling it “an unfathomable sum” that was unfair to shareholders. However, Tesla’s board chairperson, Robyn Denholm, disagreed with the ruling, stating in a letter included in the regulatory filing that they do not agree with the court’s decision.
The rejected compensation plan was nullified by the January ruling, but Tesla is now seeking shareholder approval to reinstate it. Musk’s compensation for 2023 was $0, as he does not take a salary from the company and is compensated through stock options.
In addition to seeking approval for Musk’s pay package, Tesla is also asking shareholders to approve its decision to move the company’s state of incorporation from Delaware to Texas. The move comes as Tesla continues to expand its operations and presence in Texas.
