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Musk's $56B pay package vote approved: Can it drive TSLA further?
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[Moo Brief] TSLA shareholder meeting preview: Will Musk secure his $56 billion compensation and tighten grip on Tesla?

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Moomoo CA joined discussion · Jun 11 23:00
[Moo Brief] TSLA shareholder meeting preview: Will Musk secure his $56 billion compensation and tighten grip on Tesla?
As $Tesla (TSLA.US)$ approaches its shareholder meeting, key decisions await your vote. On Thursday, June 13, 2024, at 3:30 PM CT, $Tesla (TSLA.US)$ will convene its Annual Shareholder Meeting.
Two particularly burning issues are set to dominate the agenda:
1. The shareholders will cast their votes on whether to endorse Elon Musk's staggering $56 billion compensation package.
2. A proposal to relocate the company's incorporation from Delaware to its operational hub in Texas will be tabled for consideration.
Do you support the proposal, and what is the impact?
Why Musk's Pay Sparks Debate
Earlier this year, Musk's 2018 compensation plan met with a legal setback when a Delaware court ruled against it, casting a shadow over investor confidence in his leadership. A rejection of Musk's current pay proposal could signal growing investor unease about his stewardship of $Tesla (TSLA.US)$. However, it’s worth noting that the vote is advisory and not legally binding, leaving Tesla the discretion to heed or disregard shareholder suggestions.
Should the compensation plan gain approval, Musk’s stake in $Tesla (TSLA.US)$ could skyrocket from 13% to over 20%. Musk has publicly expressed, via his X account in January, his unease about escalating Tesla's lead in AI and robotics without substantial voting control: "I am uncomfortable growing Tesla to be a leader in AI & robotics without having 25% voting control. Enough to be influential, but not so much that I can’t be overturned," Musk stated. "Unless that is the case, I would prefer to build products outside of Tesla."
What's Inside Musk's 2018 Mega Pay Package
The 2018 pay package approved for Musk by $Tesla (TSLA.US)$ involved a series of 12 market capitalization and operational milestones. Achievement of all targets could grant Musk an accumulative 12% of Tesla's stock options, estimated at around $56 billion, making it one of the most colossal executive compensation packages in American history. At the time, reaching the final milestone—a market cap of $650 billion—seemed a herculean task, with Tesla's value at approximately $59 billion. Yet, following the announcement, $Tesla (TSLA.US)$’s valuation hit the fast lane, briefly exceeding $1 trillion in 2021.
[Moo Brief] TSLA shareholder meeting preview: Will Musk secure his $56 billion compensation and tighten grip on Tesla?
Why Shareholders Resist Musk's Pay
In 2022, some $Tesla (TSLA.US)$ shareholders took Musk to court, accusing him of diverting his focus to other ventures like SpaceX and leveraging his influence to secure the long-term pay plan. Consequently, a Delaware judge deemed Musk’s compensation plan unfair to shareholders in January.
In response, Musk has suggested relocating $Tesla (TSLA.US)$'s state of incorporation from Delaware to Texas. As the drama unfolds, the upcoming shareholder meeting is not only a litmus test for Musk's vision but also a potential turning point for $Tesla (TSLA.US)$'s future. The outcomes could reshape the company's trajectory and redefine Musk's role in spearheading the burgeoning fields of AI and robotics within the automotive industry.
[Moo Brief] TSLA shareholder meeting preview: Will Musk secure his $56 billion compensation and tighten grip on Tesla?
As an investor, how do you view Musk's influence on Tesla's success? Furthermore, consider the potential impact if Musk were to lose control of the company. What direction do you foresee for $Tesla (TSLA.US)$ in such a scenario? Free feel to share your views below.
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[Moo Brief] TSLA shareholder meeting preview: Will Musk secure his $56 billion compensation and tighten grip on Tesla?
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[Moo Brief] TSLA shareholder meeting preview: Will Musk secure his $56 billion compensation and tighten grip on Tesla?
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