Elon Musk
Musk’s lawyers are calling for a refund for this reason!
A Delaware court is scrutinizing Elon Musk’s massive 2018 bonus package, following lawyers for a Tesla shareholder urged the judge on Tuesday to void the massive bonus package awarded by the company’s board, potentially worth more than $55 billion. dollar.
The latest arguments come in the wake of a trial in November, in which Musk denied that he dictated the terms of the package or attended any meetings where the plan was discussed by the board of directors, the compensation committee, or the working group that helped develop it, according to “Fox News”, and I was briefed on it. It is called “Al-Arabiya.net”.
Lawyers for the shareholders argue the compensation package should be scrapped because it was dictated by Musk and resulted from bogus negotiations with directors who were not independent of him.
The lawyers also said that the shareholders approved it, following obtaining misleading disclosures and incomplete statements.
Attorney Greg Varallo argued that the Tesla defendants should be required to prove that the bonus plan was “entirely fair” to shareholders because Musk was a controlling shareholder.
Farallo told counselor Kathleen St. Jude McCormick that Musk should be forced to return some, if not all, of his stock option grants.
McCormick is the same judge who forced Musk to buy Twitter for $44 billion when he tried to back out of his agreement to buy the social media platform.
Defense attorneys countered that the bonus plan was fairly negotiated by a compensation committee whose members were independent, contained performance milestones so lofty that some Wall Street investors derided it, and was blessed by a shareholder vote that was not even required under Delaware law.
Under the plan, Musk, who owned regarding 22% of Tesla shares when the plan was approved, would receive shares equivalent to 1% of the shares outstanding at the time of the grant, and his stake would rise to 28% of the shares if the company’s market value grew by $600 billion. .
Over the following years, Tesla achieved all bonus requirements for 12 company market value criteria and 11 operating criteria, making Musk eligible to receive stock options worth nearly $28 billion, according to a post-trial brief provided by plaintiff’s attorneys.
Defense attorney Evan Chesler said the compensation package was a “high risk and reward” deal that not only benefited Musk but Tesla shareholders, who saw the company’s value rise from $53 billion to more than $600 billion. It is noteworthy that the value of Tesla reached a trillion dollars last year.