Musk Record Tesla Pay Plan Rejected Again by Delaware Judge

[onenote]

15. He's in court because a handful of shareholders challenged the pay package in Delaware court.

The court held it was unlawful. So Musk arranged for a shareholder vote in an attempt to get around the court decision. More than 70% of the shares, NOT including shares held by Musk and his brother, voted to approve the pay package. They also voted to move the company's legal place of incorporation from Delaware to Texas. The new court decision ruled against this "ratification" ploy. By the way, those minority shareholders that challenged the pay package asked to be paid a fee over over $5 billion for having won the case. The court reduced that award to $345 million -- still more than $343 million more than plaintiff's actual costs of litigating the case.

So, Musk will appeal the court's decision and while the court's opinion seems sound to me, I have no idea what a Delaware appeals court will think. And, ultimately, if down the road, Musk presents a new compensation plan, and it gets challenged, the case would be heard in Texas and I wouldn't be surprised if it was upheld by a court in Texas, which is where Tesla is physically located. Would you?

Finally, in the months following the June "ratification" vote, the company's stock has doubled in value, from around $175/share to around $350/share. So, in what universe do you think those shareholders won't continue to support whatever Musk wants. I'm not sure what you are referring to when you reference "EBT losses" -- do you mean EBITDA? Because Tesla's year over year EBITDA for the third quarter of 2024 was up 35.5%