Some shareholders of the electric vehicle giant Tesla Inc TSLA are writing to the Delaware Court of Chancery regarding the reversal of the company’s CEO’s 2018 compensation package worth $56 billion and Elon Musk he is grateful for it.
What happened: Alessandra Merz he is one of the shareholders. In the contents of her letter published on
“The anticipated invalidation of the 2018 compensation package due to the court ruling does not provide a solid basis for calculating potential financial gains,” Merz wrote, adding that he has already submitted a written request to Tesla’s board of directors requesting reinstatement of a similar compensation package for the CEO.
He also criticized the plaintiff’s lawyer’s request in the case for a $6 billion payout in Tesla stock, asking the court to impose a long vesting period if it chooses to grant it. This long vesting period would safeguard the interests of small shareholders like yourself, she added.
Another shareholder Kristen Netten approached X asking more shareholders to join the campaign.
“Please consider respectfully and firmly stating your reasoning as to why the highly disproportionate representation of shareholders in the ruling and having lawyers pay in Tesla 6B stock is further insulting,” Netten wrote.
Musk responds: Musk went to X on Monday to thank shareholders for the campaign.
“Thanks :),” she wrote.
Because matter: The writing campaign is promoted on X with the hashtag #DelawareCourt81. It follows a significant ruling last month, in which the Delaware Court of Chancery is the judge Kathleen McCormick voided a 2018 compensation package worth about $56 billion awarded to Musk by Tesla’s board of directors in 2018. The judge found that the board was not sufficiently independent from Musk and that the governance process leading to the grant , as well as the value, were “unfair” towards the other shareholders. Musk is expected to appeal the pay cancellation decision.
Lawyers representing the plaintiff in the case approached the court last week demanding $6 billion worth of Tesla shares for successfully challenging Musk’s pay. They also asked to be able to sell these shares immediately without a holding period. The request is awaiting approval from McCormick.
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