Tesla shareholders to reject a $56 billion pay package for Chief Executive Officer Elon Musk, which if passed would be the largest pay package for a CEO in corporate America.
(Reuters) – Proxy advisory firm Glass Lewis said on Saturday it has urged.
The “excessive size” of the compensation package, the dilutive effect upon exercise, and the concentration of ownership were among the reasons given by the study.
Additionally, Musk’s “slate of extraordinarily time-consuming projects” was addressed, which has grown as a result of his well-publicized acquisition of Twitter, which is now known as X.
The compensation package was suggested by Tesla’s board of directors, who have faced criticism for their close relationship with the billionaire. The program does not include a salary or cash incentive.
Instead, benefits are determined by the market value of Tesla, which may increase to $650 billion in ten years starting in 2018.
Based on LSEG data, the corporation is currently valued at approximately $571.6 billion.
The initial compensation package was revoked in January by Delaware’s Court of Chancery Judge Kathleen McCormick. Then, Musk attempted to have Texas replace Delaware as the state of incorporation for Tesla.
Glass Lewis also attacked the proposed relocation to Texas, claiming that it would expose shareholders to “uncertain benefits and additional risk”.
The initial compensation package was revoked in January by Delaware’s Court of Chancery Judge Kathleen McCormick. Then, Musk attempted to have Texas replace Delaware as the state of incorporation for Tesla.
Tesla has asked its investors to confirm that they still approve of the salary.
Musk became Tesla CEO in 2008
Robyn Denholm, the head of Tesla’s board, told the Financial Times in an interview this month that Musk is deserving of the compensation package because the business has exceeded its high sales and stock price goals.
In 2008, Musk was appointed CEO of Tesla. According to an online campaign website called Vote Tesla, he has improved the company’s performance in the last few years, leading it to a $15 billion profit from a $2.2 billion loss in 2018. Additionally, the company has manufactured seven times more automobiles.
The proxy advice also suggested that shareholders abstain from voting for the reelection of Kimbal Musk, a board member and the brother of the billionaire while endorsing James Murdoch, the former CEO of 21st Century Fox, for reelection.
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Source
Yahoo Finance
