Tesla shareholders have re-approved CEO Elon Musk's $44.9 billion pay package, the company announced today. "Our stockholders have approved the ratification of the 100 percent performance-based stock option award to Elon Musk that was approved by stockholders in 2018," Brandon Ehrhart, Tesla's general counsel and corporate secretary, announced at Tesla's annual shareholder meeting.
Ehrhart also said that shareholders approved a corporate move from Delaware to Texas, and the re-election of board members James Murdoch and Kimbal Musk (Elon Musk's brother). While the official announcement was made at the shareholder meeting late in the day on Thursday, Musk revealed that the yes votes were winning in a social media post last night.
"Both Tesla shareholder resolutions are currently passing by wide margins!" Musk wrote, referring to the pay vote and the move from Delaware to Texas. His post included charts indicating that both shareholder resolutions had more than enough yes votes to surpass the "guaranteed win" threshold.
The results were preliminary at the time Musk announced them. Voters still had the option of changing their votes.
Under a settlement with the Securities and Exchange Commission, Musk is required to get pre-approval from a Tesla securities lawyer for social media posts that may contain information material to the company or its shareholders. Tesla today submitted an SEC filing containing a screenshot of Musk's X post describing the preliminary results.
Legal uncertainty remains
Musk's pay plan was previously nullified by a judge's ruling. The vote isn't the last word on the pay package that was once estimated to be worth $56 billion and more recently valued at $44.9 billion based on Tesla's stock price. The pay plan was thrown out by a Delaware Court of Chancery ruling in January 2024 after a lawsuit filed by a shareholder.
Judge Kathaleen McCormick ruled that the pay plan was unfair to Tesla's shareholders, saying the proxy information given to investors before 2018 was materially deficient. McCormick said that "the proxy statement inaccurately described key directors as independent and misleadingly omitted details about the process."