Musk praises “incredible shareholder base” after US judge rejected vote to restore compensation deal.
Elon Musk got his $44.9 billion pay package back at electric car maker Tesla after shareholders voted to reinstate the compensation deal in a ringing endorsement of his leadership.
The vote at Tesla's annual meeting on Thursday came after a judge in the US state of Delaware threw out the deal after finding that the company's board of directors was too close to Musk and had failed to protect shareholder interests.
“I just want to start by saying, damn, I love you!” Musk said jubilantly as he appeared on stage after the vote.
“We have the most impressive shareholder base. “I mean it’s just amazing.”
Musk's pay deal was valued at around $56 billion at the peak of Tesla's stock price in late 2021, but its value has since declined by about a quarter along with a drop in the price of the company's shares.
The shareholder vote does not necessarily mean Musk will receive the pay package, but it could bolster Tesla's appeal against Delaware's ruling against the deal.
In her January decision, Delaware Judge Kathaleen McCormick described the pay package as “unfathomable.”
“Carried away by the 'everything good' rhetoric, or perhaps surprised by Musk's superstar appeal, the board never asked the $55.8 billion question: Was the plan even necessary for Tesla to retain Musk and achieve its objectives?” McCormick wrote in his decision.
Musk, who founded Tesla in 2003, does not receive a salary for running the automaker.
Under the terms of his 2018 pay deal, Musk agreed to receive shares worth about 1 percent of Tesla's equity each time the company achieved one of its operating and financial goals.
While Tesla's business has soared under Musk's leadership, at one point taking the company's market value to $1.24 trillion, sales have slowed sharply amid growing competition from Chinese manufacturers. of electric vehicles.
Musk has also sparked controversy with his outspoken views on politics and has fought perceptions that he is too spread-eagle due to his involvement in six companies, including rocket company SpaceX and social media platform X.
Tesla shares rose 0.7 percent in after-hours trading Thursday, after previously gaining 2.9 percent following Musk's announcement on social media that investors backed the deal.
Before Thursday's vote, Musk had expressed doubts about his future at Tesla.
In January, Musk said in a post on X that he would prefer to build artificial intelligence and robotics products outside of Tesla if he couldn't have a 25 percent stake in the company.
Musk is already by far Tesla's largest shareholder, owning more than 20 percent of its capital.
Tesla shareholders on Thursday also approved proposals to move the company's incorporation from Delaware to Texas and reappoint Kimbal Musk and James Murdoch, Musk's brother and son of media mogul Rupert Murdoch, respectively, to the board of directors. of the company.
Tesla did not announce the vote count, but several large institutional investors had opposed the deal, including Norges Bank Investment Management, the world's largest sovereign wealth fund.
