Latest news with #shareAward
CNA
7 days ago
- Automotive
- CNA
Tesla Grants Elon Musk New $29 Billion Share Award to Secure CEO Rol
NEW YORK: Tesla has approved a fresh share award worth about US$29 billion for CEO Elon Musk in an effort to keep him at the helm as the company pivots from its core electric vehicle (EV) business to emerging ventures such as robotaxis and humanoid robots, the company said on Monday (Aug 4). The award, which grants Musk 96 million new shares, was described as a 'good faith' gesture to honour the spirit of a US$50 billion pay package from 2018 that was struck down by a Delaware court last year. Musk can only claim the new award if he remains in a key executive position at Tesla for at least two more years and the Delaware courts do not reinstate the 2018 plan. Tesla said the shares, priced at US$23.34 each, will be subject to a five-year holding period. The company said it will seek shareholder approval of a longer-term compensation plan at its investor meeting on Nov 6. TESLA BOARD SHOWS SUPPORT The move underscores the board's continued support for Musk, despite recent controversies surrounding his political activity and involvement in outside ventures including artificial intelligence startup xAI. 'While we recognise Elon's business ventures, interests and other potential demands on his time and attention are extensive and wide-ranging... we are confident this award will incentivise Elon to remain at Tesla,' said a special committee composed of board chair Robyn Denholm and independent director Kathleen Wilson-Thompson. The new shares will be forfeited or offset if Musk's voided 2018 award is reinstated, effectively preventing any 'double dip,' the committee said. The company said it would not recognise compensation expense for the award at this time, as it does not currently expect the performance condition to be met. It will re-evaluate the situation if that changes after the two-year vesting period. STOCK CLIMBS, INVESTORS REACT Tesla shares rose nearly 2 per cent in early trading on Monday, easing concerns over Musk's long-term commitment and the future leadership of the EV pioneer. The stock has lost about 25 per cent this year, as of Friday's close. "Under normal circumstances, a compensation package in the billions would raise some eyebrows. (But) clearly investors have benefited from Musk's stewardship of Tesla," said Camelthorn Investments adviser Shawn Campbell. 'This stock grant will bind Musk to Tesla for the next two years.' Musk's new award boosts his stake in the company to more than 15 per cent, up from 12.7 per cent, according to Reuters calculations based on LSEG data. 2018 PACKAGE APPEAL ONGOING The Delaware court's January ruling invalidated Musk's 2018 pay plan, which was the largest in US corporate history. The court cited procedural flaws and found the package to be unfair to shareholders. Musk has appealed the decision, arguing that the package spurred tremendous value creation and was twice approved by investors. Tesla shares have surged nearly 2,000 per cent over the past decade, compared to a 200 per cent rise in the benchmark S&P 500 index. Still, some governance experts questioned the latest move. "This is simply a repackaged version of what was done years ago and was ruled improper by a judge. It renders the Delaware court decision effectively meaningless," said Charles Elson, founding director of the Weinberg Center for Corporate Governance at the University of Delaware.
Yahoo
7 days ago
- Automotive
- Yahoo
Tesla approves $29bn share award to Elon Musk
Tesla's board has signed off a $29bn (£21.8bn) share award to Elon Musk after a court blocked an earlier package worth almost double that sum. The new award, which amounts to 96 million new shares, is not just about keeping the electric vehicle (EV) firm's founder in the driving seat as chief executive. The new stock will also bolster his voting power from a current level of 13%. Money latest: He and other shareholders have long argued that boosting his interest in the company is key to maintaining his focus after a foray into the trappings of political power at Donald Trump's side - a relationship that has now turned sour. Musk is angry at the president's tax cut and spending plans, known as the big beautiful bill. Tesla has also suffered a sales backlash as a result of Musk's past association with Mr Trump and role in cutting federal government spending. The company is currently focused on the roll out of a new cheaper model in a bid to boost flagging sales and challenge steep competition, particularly from China. The headwinds have been made stronger as the Trump administration has cut support for EVs, with Musk admitting last month that it could lead to a "few rough quarters" for the company. Read more: Tesla faces losing billions after Musk-Trump fallout Tesla is currently running trials of its self-driving software and revenues are not set to reflect the anticipated rollout until late next year. Musk had been in line for a share award worth over $50bn back in 2018 - the biggest compensation package ever seen globally. But the board's decision was voided by a judge in Delaware following a protracted legal fight. There is still a continuing appeal process. Earlier this year, Tesla said its board had formed a special committee to consider some compensation matters involving Musk, without disclosing details. The special committee said in the filing on Monday: "While we recognize Elon's business ventures, interests and other potential demands on his time and attention are extensive and wide-ranging... we are confident that this award will incentivize Elon to remain at Tesla". It added that if the Delaware courts fully reinstate the 2018 "performance award", the new interim grant would either be forfeited or offset to ensure no "double dip". The new compensation package is subject to shareholder approval.
Sky News
7 days ago
- Automotive
- Sky News
Tesla approves $29bn share award to Elon Musk
Tesla's board has signed off a $29bn (£21.8bn) share award to Elon Musk after a court blocked an earlier package worth almost double that sum. The new award, which amounts to 96 million new shares, is not just about keeping the electric vehicle (EV) firm's founder in the driving seat as chief executive. The new stock will also bolster his voting power from a current level of 13%. He and other shareholders have long argued that boosting his interest in the company is key to maintaining his focus after a foray into the trappings of political power at Donald Trump 's side - a relationship that has now turned sour. Musk is angry at the president's tax cut and spending plans, known as the big beautiful bill. Tesla has also suffered a sales backlash as a result of Musk's past association with Mr Trump and role in cutting federal government spending. The company is currently focused on the roll out of a new cheaper model in a bid to boost flagging sales and challenge steep competition, particularly from China. The headwinds have been made stronger as the Trump administration has cut support for EVs, with Musk admitting last month that it could lead to a "few rough quarters" for the company. 3:31 Tesla is currently running trials of its self-driving software and revenues are not set to reflect the anticipated rollout until late next year. Musk had been in line for a share award worth over $50bn back in 2018 - the biggest compensation package ever seen globally. But the board's decision was voided by a judge in Delaware following a protracted legal fight. There is still a continuing appeal process. Earlier this year, Tesla said its board had formed a special committee to consider some compensation matters involving Musk, without disclosing details. The special committee said in the filing on Monday: "While we recognize Elon's business ventures, interests and other potential demands on his time and attention are extensive and wide-ranging... we are confident that this award will incentivize Elon to remain at Tesla". It added that if the Delaware courts fully reinstate the 2018 "performance award", the new interim grant would either be forfeited or offset to ensure no "double dip".
