Tesla awards CEO Musk millions of shares valued at about 29 billion dollars
The electric vehicle maker said in a regulatory filing on Monday that Mr Musk must first pay Tesla 23.34 dollars per share of restricted stock that vests, which is equal to the exercise price per share of the 2018 pay package that was awarded to the company's CEO.
In December, Delaware chancellor Kathaleen St Jude McCormick reaffirmed her earlier ruling that Tesla must revoke Mr Musk's multibillion-dollar pay package.
She found that Mr Musk engineered the landmark pay package in sham negotiations with directors who were not independent.
Elon Musk, CEO of Tesla (PA)
At the time, Ms McCormick also rejected an equally unprecedented and massive fee request by plaintiff attorneys, who argued that they were entitled to legal fees in the form of Tesla stock valued at more than five billion dollars.
The judge said the attorneys were entitled to a fee award of 345 million dollars.
The rulings came in a lawsuit filed by a Tesla stockholder who challenged Mr Musk's 2018 compensation package.
That pay package carried a potential maximum value of about 56 billion dollars, but that sum has fluctuated over the years based on Tesla's stock price.
Mr Musk appealed against the order in March. A month later Tesla said in a regulatory filing that it was creating a special committee to look at Mr Musk's compensation as CEO.
Wedbush analyst Dan Ives feels Mr Musk's stock award may alleviate some Tesla shareholder concerns.
'We believe this grant will now keep Musk as CEO of Tesla at least until 2030 and removes an overhang on the stock,' Mr Ives wrote in a client note.
'Musk remains Tesla's big asset and this comp issue has been a constant concern of shareholders once the Delaware soap opera began.'
Tesla shares have plunged 25% this year, largely due to blowback over Mr Musk's affiliation with President Donald Trump.
But Tesla also faces intensifying competition from both the big Detroit car makers, and from China.
In its most recent quarter, Tesla reported that quarterly profits plunged from 1.39 billion dollars to 409 million dollars.
Revenue also fell and the company fell short of even the lowered expectations on Wall Street.
Under pressure from shareholders last month, Tesla scheduled an annual shareholders meeting for November to comply with Texas state law.
A group of more than 20 Tesla shareholders, which have watched Tesla shares plummet, said in a letter to the company that it needed to at least provide public notice of the annual meeting.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
RTÉ News
5 hours ago
- RTÉ News
Tariffs on pharmaceuticals could reach 250%, says Trump
US President Donald Trump has said that upcoming tariffs on imported pharmaceuticals could reach 250%, after starting at a lower level, while adding he plans to also unveil fresh duties on foreign semiconductors. "We'll be putting (an) initially small tariff on pharmaceuticals, but in one year, one-and-a-half years, maximum, it's going to go to 150%," Mr Trump said in an interview on CNBC. "And then it's going to go to 250% because we want pharmaceuticals made in our country," he added. In the same interview, Mr Trump said he expects to raise the US tariff on Indian imports "very substantially over the next 24 hours" due to the country's purchases of Russian oil. While Mr Trump has taken aim at products from different countries with varying tariff rates after imposing a 10% levy on almost all trading partners in April, these have excluded certain products he planned to target separately. These sector-specific tariffs have generally come after government investigations that look into the national security concerns surrounding certain imports. After earlier embarking on probes on imported semiconductors and pharmaceuticals, the Trump administration has signaled plans to wrap up these studies which could lead to new tariffs. Already, Mr Trump has slapped steep tariffs of 50% on imported steel and aluminum, and also rolled out a separate but lower duty on autos and parts. EU suspends retaliatory tariffs after deal The threat of higher tariffs on pharmaceuticals came after the EU announced the suspension of its retaliatory tariffs on US goods worth €93 billion after Brussels struck a deal with Washington last month. "The commission has today adopted the necessary legal procedures to suspend the implementation of our EU countermeasures, which were due to kick in on August 7," EU trade spokesman Olof Gill said. Earlier, an official said that the 15% tariff that European Union goods face when entering the United States is all-inclusive, incorporating the Most Favoured Nation Rate, unlike some other countries with deals with the US. The 15% rate applies to all goods, except for steel, aluminium, the EU official said. Tariffs on pharmaceuticals and semiconductors are now zero, but if and when they rise as a result of the US 232 investigations, the tariff will be no higher than 15% as well. This 15% ceiling also applies to cars and car parts. There are no quotas or limits on cars and car parts. The official also said the EU is close to its final joint statement with the United States regarding their framework trade deal although no precise time can be given yet regarding when this will be published. "It is pretty much ready and we are now waiting for our US colleagues to come back and confirm the final few things," said the official. Deal provides 'insurance policy' against higher tariffs - EU Olof Gill also said that the EU-US trade deal agreed last week provides an "insurance policy" against higher tariffs for European businesses. "We reached a negotiated solution to avoid a lose-lose situation. That's what our member states asked for and what businesses asked for," Mr Gill told reporters at a lunchtime press briefing in Brussels. "The agreement reached will have a stable platform from which we will secure crucial supply chains." Mr Gill described as "surprising" comments made by Germany's finance minister Lars Klingbeil in Washington yesterday, who said that the EU had been "too weak" in trade negotiations with Washington. "It is surprising to us to hear that a minister from the member state in question has aired that view," said Mr Gill. Mr Klingbeil held talks in Washington yesterday with US Treasury Secretary Scott Bessent and was seeking an exemption from US tariffs for German steel. Mr Gill also confirmed that the Commission has taken the necessary legal steps to suspend the EU's planned tariff countermeasures against the US. Those measures were due to start on 7 August in the event that a trade deal was not reached. The bloc's planned countermeasures will be suspected for six months, he confirmed. US tariffs on EU imported goods at the agreed 15% rate are expected to come into force on 8 August.
Extra.ie
11 hours ago
- Extra.ie
Guinness maker Diageo suffers major plunge in profits
Guinness maker Diageo has revealed a slump in profits after a 'challenging year' which saw its former boss leave. The world's largest spirits firm, which also makes Johnnie Walker whisky and Gordon's gin, revealed operating profits fell 27.8% to 4.33 billion US dollars (£3.3 billion) in the year to June 30. It comes weeks after the group said Debra Crew had stepped down as chief executive with 'immediate effect' and by 'mutual agreement', following a decline in Diageo's share value. Guinness maker Diageo has revealed a slump in profits after a 'challenging year' which saw its former boss leave. Pic: Artur Widak/NurPhoto via Getty Images Interim chief executive Nik Jhangiani said: 'While macroeconomic uncertainty and the resulting pressure on consumers continues to weigh on the spirits sector, we believe in the attractive long-term fundamentals of our industry and in our ability to continue to outperform as the TBA (total beverage alcohol) landscape evolves. 'We are focused on what we can manage and control and executing at pace. 'The board and management are committed to delivering improved financial performance and stronger shareholder returns on a sustained basis.' The world's largest spirits firm, which also makes Johnnie Walker whisky and Gordon's gin, revealed operating profits fell 27.8% to 4.33 billion US dollars (£3.3 billion) in the year to June 30. Pic: Artur Widak/NurPhoto via Getty Images In May, Diageo unveiled a plan to cut $500 million in costs and make substantial asset sales by 2028 in a major turnaround drive. Before leaving by 'mutual agreement', Debra Crew had been in the top role for around two years after long-time boss Ivan Menezes' death in June 2023 following a brief illness. She was one of only a handful of women to lead a blue-chip UK company and previously held the position of chief operating officer. Guinness remained one of their standout performers. Pic: Anton Ivanov/Shutterstock Crew served in the US military before beginning a career in the consumer goods industry, working at PepsiCo., Nestle and Mars. She is also a former boss of tobacco company Reynolds American. Diageo's shares lost about 44% of their value during her tenure. They have still been among the better performers in the European wine and spirits sector, which has struggled after a boom during the pandemic when people drank more at home. Recently, Donald Trump's tariff war has made operational challenges at Diageo even tougher. However, their cash generation remained strong, with free cash flow rising to $2.74bn and net operating cash flow topping $4.3bn, up from $2.33bn and $4.1bn, respectively. Diageo also increased its cost savings target under its Accelerate programme to $625m and expects to deliver $3bn in free cash flow in fiscal 2026. Guinness remained one of their standout performer along with Don Julio and Crown Royal Blackberry. Diageo said that these brands as well as its diversified portfolio and disciplined execution helped offset pressure across parts of its business.
Irish Times
a day ago
- Irish Times
The Irish Times view on the budget debate: striking a difficult balance
A clear danger is emerging in the run up to October's budget. It is that all the spare cash available will be spent as Fianna Fáil and Fine Gael each try to get as many of their own policies into the package as they can, with the Independents also pitching in. Rather than taking a balanced view of the outlook, the negotiations thus turn into a haggling exercise. There were media reports this weekend of – unnamed– ministers saying that the economic outlook had not changed much and the budget can go ahead as planned. In this context, pressure will come on, in addition to the €9.4 billion package of tax cuts and spending increases outlined in the Summer Economic Statement, to have additional once-off measures. Ministerial statements, while suggesting there will not be a full cost-of-live package, have become more equivocal on this point. Ministers may be correct to believe that the short-term budgetary outlook has not changed markedly, with the US and EU striking a trade deal. But two points are relevant here. The first is that the two sides have really just set a framework for future talks and a lot remains to be signed off. Also, a separate US investigation into the pharma sector carries danger for Ireland., The second point is that, as Gabriel Makhlouf, the governor of the Central Bank has said, the Government needs to be careful not to add further demand to an already strongly-growing economy. This is all the more the case given the significant planned increase in State investment. READ MORE The balance will be hard to get right. But it must err towards caution. As well as the short-term issues, the economy is now facing significant uncertainties over the next few years. The trade environment is far from settled and tensions between the US and EU may still emerge. Meanwhile, the US president is determined to attract pharma investment back to the US from countries such as Ireland and this could threaten both jobs and tax revenue. And that is before we consider a troubled and rapidly changing international political situation. Ignoring these factors and squabbling over budget giveaways is the wrong approach.
