After Tesla CEO Elon Musk's super bonus package was intercepted by the court, nearly 6,000 Tesla shareholders signed a joint petition in less than 5 days to support Musk and demand that Tesla's board of directors fight to the end.
Just last week, the lawsuit filed by Tesla shareholders against Musk's excessive bonus was found valid by the judge, requiring Tesla's board of directors to re-evaluate the bonus worth more than $50 billion, but within 4 days, the "supporting horse" investors launched a joint petition to ask the board of directors to adhere to this sky-high bonus to encourage Musk's achievements.
As many as 5,821 shareholders participated in the joint designation, holding a total of 23.33 million Tesla** shares, which translates into a market value of nearly $4 billion. The group of shareholders was menacing, and their joint letter was basically a provocation to the Delaware judge in charge of the trial.
Tesla's board of directors was voted by shareholders, who fully understand the board's close relationship with Musk, and the judge's decision is tantamount to erasing the voting results of private corporate shareholders, which is quite dangerous to American corporate culture. We ask the Board of Directors to maintain the original bonus design, while proposing similar performance bonuses to enable Tesla to achieve higher achievements.Shareholders even believe that since Tesla's headquarters has moved to Texas, and Delaware is so strongly involved in corporate operations, it is better to change the corporate entity to Texas.
This demand represents the democratization of business management on the one hand, and the rule of strongmen on the other. Shareholders believe that Tesla's growth is inseparable from Musk's, and that the bonus focuses not only on monetary value, but more importantly on enough for Musk to maintain 25% or more of his stake, allowing him to dominate the company's decision-making.
This "2018 reward package" refers to the incentive plan designed by Tesla for CEO Musk that year, if Musk can increase Tesla's market value to a certain threshold, he can get 1% equity, Tesla's market value was less than $60 billion at that time, and in 2021, Tesla's market value has exceeded $1 trillion at the most, which means that Musk can get 12% of Tesla's equity.
Some minority shareholders of Tesla believe that the court's intervention in the company's operation requires stronger legitimacy, and it is not reasonable for the shareholder who filed the lawsuit, who holds only 9 shares, to influence such a huge corporate decision.
Having said that, it is also noted at the end of the Delaware court documents that the judgment is not final, the plaintiffs can be revoked, and Tesla's board of directors can appeal again.
Header image**: Tesla).