Wednesday, May 22, 2024
26 C
Brunei Town

Tesla asks shareholders to reapprove huge Musk pay deal

NEW YORK (AFP) – Electric vehicle (EV) maker Tesla will ask its shareholders to vote again on a USD56 billion compensation package they had approved in 2018 for chief executive officer (CEO) Elon Musk before it was squashed by a United States court earlier this year.

In a filing with federal regulators, Tesla Chair Robyn Denholm said the board of directors stood by the original package and argued that the company’s “entrepreneurial spirit” had always been one of “big risks for the chance of big rewards”.

Musk’s payout – worth as much as USD55.8 billion in 2018 – was voided in January by a Delaware court, ruling on a complaint by an individual shareholder alleging that Musk had dictated his terms to the board, which was not sufficiently independent from its star CEO.

“Elon has not been paid for any of his work for Tesla for the past six years that has helped to generate significant growth and stockholder value,” she wrote.

“That strikes us – and the many stockholders from whom we already have heard – as fundamentally unfair, and inconsistent with the will of the stockholders who voted for it.”

A Tesla Model Y car in front of the company’s plant as Tesla chief executive officer Elon Musk visits in Gruenheide near Berlin, Germany. PHOTO: AFP