A Delaware judge recently ruled to void Tesla Inc (NASDAQ:TSLA) CEO Elon Musk‘s 2018 compensation plan worth $55 billion.
After the judge’s decision, Tesla’s board has decisions to make, and some Tesla shareholders are showing their support for the automaker and its CEO, and have some ideas of their own.
What Happened: The judge’s decision came after a Tesla shareholder challenged the compensation plan that tied Musk’s earnings to the performance of Tesla metrics like market capitalization, revenue and adjusted EBITDA.
The shareholder argued proper disclosures were not presented to investors before the plan was approved by shareholders and the company’s board.
Organized by Amy Steffens (@_SFTahoe) and Alexandra Merz (@TeslaBoomerMama), who are Tesla influencers and shareholders, an effort to rally shareholders in support of Musk and the Tesla board is underway.
The duo helped gather signatures from 5,821 Tesla shareholders representing 23,337,127 TSLA shares. The signatures range form Tesla shareholders who own one share to investors with thousands of shares, as well as people have been shareholders since 2010 and more recently. The signatures were compiled over four days.
“And we are all Unanimous & United in our support of the Tesla Board of Directors and Tesla CEO Elon Musk,” according to the letter sent Monday to Tesla’s board.
The letter centers on three points: shifting Tesla’s state of incorporation from Delaware to Texas; the board exploring options to keep Musk’s 2018 pay plan in place; and the board designing a new plan along the same lines as the 2018 compensation plan that was struck down.
The shareholders envision a new compensation plan for the Tesla CEO that requires the automaker to achieve milestones such as full self-driving reaching level five autonomy; $500-billion or $1-trillion increases in Tesla’s value; or surpassing the combined value of Saudi Aramco and Apple. The proposed new plan would vest shares to Musk in order to grant him 25% or more of Tesla shares.
“If Tesla incorporates in a state allowing super voting shares, we endorse this, too,” the letter said.
Related Link: Tesla Q4 Earnings Highlights: Revenue Miss, EPS Miss, Model Y A Global Bestseller, Next-Gen Vehicle Update And More
Why It’s Important: Wedbush analyst Daniel Ives recently said…
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