Tesla shareholders are being urged by a proxy advisory firm to oppose the reinstatement of CEO Elon Musk's $56 billion pay package after it was voided by a judge earlier this year.
Tesla shareholdersset to vote this week on reinstating CEO Elon Musk's $56 billion pay package, which was voided earlier this year by a Delaware judge, are being urged by a proxy advisory firm to nix it. Glass Lewis said Saturday it urged Tesla shareholders to reject the staggering package, citing its "excessive size," the impact of Musk exercising the stock options and the concentration of the company's ownership.
Musk's original pay package was voided in January in a ruling by Judge Kathaleen McCormick of Delaware's Court of Chancery. She ruled in favor of a lawsuit brought by a shareholder to strike down the package and wrote in her decision that the package was excessively large as it was by far the largest compensation package for the CEO of a publicly traded company.
Tesla has urged shareholders to reaffirm their approval of Musk's compensation plan. In an interview with the Financial Times earlier this month, Tesla board chair Robyn Denholm said that Musk deserves the pay package because the company hit ambitious targets for revenue and its stock price. In the wake of the January ruling that voided the pay package, Musk moved to change Tesla's state of incorporation from Delaware to Texas – a proposition shareholders have also been asked to vote on.
The proxy advisor recommended that shareholders oppose the change in Tesla's incorporation state, saying there would be "uncertain benefits and additional risk" to shareholders from the change. Musk has served as Tesla CEO since 2008 and has helped drive the EV-maker's rise to the most valuable automaker in terms of market capitalization. He brought the company from a $2.
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