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  • Writer's pictureRealFacts Editorial Team

Musk’s $56 Billion Pay Deal Approved

Elon Musk

On Thursday, Tesla (TSLA) announced that shareholders voted to approve Elon Musk's 2018 $56 billion pay package and to relocate the company from Delaware to Texas, causing TSLA shares to inch up after market close. Musk's compensation package needed a simple majority excluding Musk and his brother's votes. The move to Texas, however, required a majority of all outstanding shares with all uncasted votes counting as “no”.

In 2018, the pay package was initially approved with 73% of the vote. There had been speculation that Musk might leave Tesla or focus on other ventures if his pay package was not approved this time around. The compensation deal is now valued at around $45 billion. The reapproval by shareholders follows a Delaware judge's ruling that the 2018 package was excessive and unfair to investors, citing Musk's close ties with board member. It is important to remember that Delaware courts could still block the reapproved package. Although this package is costly for shareholders, its approval brings relief by removing uncertainty and allowing Musk to focus more fully on growing the business.


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