Tesla (TSLA.O) has awarded CEO Elon Musk 96 million shares, worth approximately $29 billion. This move aims to keep Musk at the helm of the company and allow him to fight off a court ruling that invalidated a previous settlement agreement deemed unfair to shareholders.
In 2024, a court in Delaware invalidated Musk’s 2018 $50 billion settlement package, ruling that the Tesla board’s approval process was flawed and unfair to shareholders.
Musk appealed the decision in March, arguing that the lower court judge had made numerous legal errors.At the beginning of the year, Tesla management announced the formation of a special committee to evaluate some compensation issues concerning Musk, but details were not shared.
Tesla is at a major turning point, and Musk, as the company’s largest shareholder, holds a 13% stake. With Musk shifting his focus to projects like robotaxi and humanoid robots, Tesla is now positioning itself as an artificial intelligence and robotics technology company beyond being just a car manufacturer.
In its statement, the committee said, “While we acknowledge that Elon’s business ventures, interests, and time demands are very broad, we are confident that this award will encourage Elon to stay at Tesla.” It was also stated that the award aims to increase Musk’s voting power; This situation was described by Musk and shareholders as critical to ensuring the company remains focused on its mission.
Musk will pay $23.34 per expiring restricted share of Tesla, equivalent to the exercise price per share for the 2018 CEO Award.
