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Tesla is asking its shareholders to reinstate that multi-billion dollar compensation package for CEO Elon Musk
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the one that was rejected by a Delaware judge as unfair earlier this year the board says it still stands behind the
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pay package of course it does because they get paid and that uh vote in favor at the company's annual meeting would
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quote restore Tesla's shareholder democracy again but they're pulling in all the I can't believe First Amendment
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wasn't shoved in this statement shareholders will also be voting on elon's plan to move Tesla's corporate
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home from Delaware Texas so it's moot the Delaware decision mov what they said they were going to do they will do it uh
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he'll get his money back they'll win on this one Tesla's shareholders very much like Trump true social although Tesla's
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an actual business uh still will bid it up no matter what he does so they want to pay him maybe he's worth it if he if
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the stock does well if he can turn around and get better cars and you know get the economic prospects of Tesla
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doing well he's certainly capable of it compared to Donald Trump uh but um you know the argument seems to be they may
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not have been Ware what was behind the creation of the pay package but now they are um I think they will approve it I
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think most people think they will um just for people to be aware Tesla's uh stock performance has been more than
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lackluster in 20 24 the shares have lost 38% of their value so far he L pay packages wor 56 billion in January now
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it's closer to 45 billion um he is the keyman in this thing at this point it probably shouldn't be um and he wanted
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voting control back in January uh he'll get that probably it's it's his company to do with what he Wills what he wants
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to I don't know I don't it's capitalism nice to meet you thoughts I think that's
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right I I think that I do think his pay package will be reinstated and the the thing that ASAT deut and my colleague at
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Stern pointed out that made a lot of sense to me is we see the headline number 56 now 45 billion and the delay
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by the way if he were to exercise and sell all his shares I don't know if he was planning to do that it's cost him 10
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billion even if it's reinstated but that's the headline number but when they actually devised and awarded the
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compensation package it was on options on stock when the stock was Far Below this meaning that if you valued his
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actual compensation package when the award was made it was dramatically less than 45 billion and as much as I hate to
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in any way defend or acknowledge the point he wasn't he wasn't paid 45 billion he was given options much less
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than that and because the stock skyrocketed he's he's registered this enormous windfall so I'm not sure it's
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entirely fair to say should the board be paying him 45 billion if if Vox gave us uh let's say $10 million worth of
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options options that had a value of $10 million and you value options based on their upside potential using like the
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black sches method and then Tesla's stock went up I'm sorry and then vox's stock went up 10x our shares would
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probably be worth some between 100 and 200 million and people might say well these these podcasters aren't worth that
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but that's not the that's not the number you look at the initial compensation or
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value of the options when they were awarded so I think it'll be reinstated and I do think it's a little unfair to
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look at the headline number because what we're not taking into account is the fact that the stock skyrocketed after
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absolutely I get I think the point that Del Court was making is a good one this board is in his pocket and that's as
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many corporations are FYI he they're particularly in his pocket this board is it benefits from him they party with him
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you know it just shows corporate boards and this is a particularly um very compromised one that will do his bidding
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and and that's to me that's the message here is I I think you know the Delaware Court is right and these this terribly
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compromised board has every right to reward him because he's it he's the one he's the guy um again grotesque
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certainly worth it the stock has been up under his leadership so they've all benefited um in this case they've all
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done very well with his whatever his Antics may be um I do think they're facing a lot of challenges as we've
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talked about and I think we were we borne out to be right even though we got slapped by all the stands um which is
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let's look at the company itself the product is tired um the toxic behavior is hurting the brand um there's
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competition and it's a tough market so that's really what people should be looking at with this company more than
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uh anything else um and if they if he does does really well they should pay him a lot if they
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don't I feel like you should be paid based on your thing but the way they rewarded this is the Delaware Court is
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100% right what a they should go after everybody every company often it's like this this just happens to be the most
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egregious example of that presumably but so far year to date the Tesla is the worst performing stock in the S&P I mean
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out of 500 stocks it's the worst performing and also they had their biggest Miss in terms of estimates for
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vehicle deliv uh so I think this stock has a long way uh to go down they've laid off 10% of
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the workforce which is probably a good idea probably the right move but there's a lot the hardest thing about being on a
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board I find and and more broadly probably about management is compensation and in this instance it's
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it's okay how do we how do we try and justify the compensation here what I do think this will have an impact on is I
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don't think he's going to be issued some many shares that he controls the company
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or a new class of shares I think that this is basically sent a signal to the board that there are there are other
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there is other governance and you can't just do ridiculous things that are clearly off market and they're
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benefiting that Jour a second Journal piece was so like revelatory what the fix is in for this guy again he's done
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really well with the stock I'm G to you know I do not compliment Els but the problem with this company is not uh that
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he has not paid enough it has to do with the you know stop focusing on Twitter and focus on get doing better cars it
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doesn't actually it doesn't even matter now cuz there's too much competition there's too much consumer sentiment
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against him it doesn't matter he unless he comes out with the best car ever and Ro no matter how many jazz hands he puts
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around Robo taxis or anything else I would be surprised if he can pull a rabbit out of a hat here he had his time
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and we'll see you know it's a good car it's a good car but there's lots of good cars now um and that's the way it is he
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waited this is so inevitable what's happened to him and it's a business story rather than an Elon Musk story