Delaware Court Revives Musk’s Tesla Pay Deal After Appeal
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Elon Musk’s 2018 pay package from Tesla, which was once worth $56 billion, was restored last Friday by the Delaware Supreme Court, as reported by Reuters.
The report added that the restoration came almost two years after a lower court struck down the compensation deal, describing it as “unfathomable.”
The Friday ruling overturned a decision that damaged Delaware’s business-friendly reputation, while also prompting a furious backlash from Musk. The overturn will now allow Musk greater control over the firm, which he highlighted as his main concern, even after shareholders approved a new pay package that could be worth $878 billion, should Tesla meet certain targets, Reuters wrote.
Commenting on the 2024 ruling, the Supreme Court said that it had made the pay package improper and inequitable to Musk.
Musk Exceeds $700 Billion Net Worth Following The Ruling
The Friday ruling, which is 49 pages long, said that the remedy of total rescission “leaves Musk uncompensated for his time and efforts over a period of six years. The report noted that the 2018 pay package is now worth around $139 billion, based on the price of Tesla’s stock at the close of trading on Friday.
Tesla investor Deepwater Asset Management’s managing partner, Gene Munster, commented on the matter, stating that for Musk, this is a win, as it will enable him to get control faster.
Reuters wrote that if Musk exercises all the stock options from the 2018 package, his stake in Tesla would grow from 12.4% to 18.1% of an expanded share base. Meanwhile, Tesla shares went up 1% in the after-hours trading after the ruling.
The company itself did not comment on the ruling, but Musk has, saying that he was “vindicated.”
A separate report published Friday, December 19, also said that Elon Musk became the first person worth $700 billion following the pay package ruling. The report detailed that Musk’s net worth had soared to $749 billion late Friday, becoming the first person to surpass both the $600 billion and $700 billion marks, exceeding the previous title holder, Larry Page, Google’s co-founder, by nearly $500 billion.
In November, Tesla shareholders separately approved a $1 trillion pay plan for the company’s CEO, which is the largest corporate pay package in history, as investors endorsed his vision of morphing an EV market into an AI and robotics juggernaut.
