Tesla investors back record pay deal for CEO Elon Musk

Tesla shareholders voted in favor of a compensation package for CEO Elon Musk, endorsing the potential windfall after a Delaware court invalidated it, a company official said Thursday

Based on preliminary vote results, investors backed a plan of up to $56 billion for the mercurial Musk, corporate secretary Brandon Ehrhart said at Tesla's annual meeting in Austin, Texas.

"I just want to start off by saying, hot damn, I love you guys," a euphoric Musk said as he took the microphone after the preliminary vote results were announced.

The package was originally approved by investors in 2018, but a Delaware court struck it down in January 2024, prompting Tesla to launch a campaign to revive it.

Legal experts say that Thursday's vote does not automatically mean Musk will receive the payout, but that the win could strengthen Tesla's appeal of the Delaware ruling.

Tesla shares rose 0.7 percent in after-hours trading.

The stock gained 2.9 percent in Thursday's session after Musk posted late Wednesday on social media platform X that investors backed the pay plan.

Analysts said passage of the compensation package will likely ensure Tesla continues to be led by Musk, who had hinted he might exit without an adequately large stake in Tesla. Musk had about 20.5 percent of Tesla shares at the end of 2023.

Litigation continues

Shareholders overwhelmingly backed the Musk compensation plan in 2018, but it was struck down by Delaware judge Kathaleen McCormick, who ruled that the plan was devised in a "deeply flawed" manner given Musk's extensive ties to key Tesla directors who blessed the plan.

(AFP)


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