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278 sats \ 5 replies \ @freetx 3 Dec \ parent \ on: Delaware judge rejects Musk's $56 billion Tesla compensation Stacker_Stocks
Well, why would they "cap the upside?" I mean each 1% grant of stock options was dependent on him hitting specific revenue/market growth goals.
If Musk makes more money from each 1% grant, then the rest of the shareholders (the majority) also makes more money....
The fact that TSLA shares are now falling after the judgement shows that the market thinks this will hurt the company.
Why not consider capping the hype or other deal structures, in order to demonstrate due diligence to shareholders? He already makes a shit-ton of money on the stock growth because he already owns an immense amount of shares- which should bring him enough motivate him to succeed. $50 billion (now way higher) is unheard of.. what's the next highest stock comp in the tech industry? Would not upside up until $10 billion not be sufficient to motivate a CEO? Did they discuss giving him a guaranteed salary in return for an upside cap? It seemed there's a process the board is supposed to go through for public companies that was not followed (my 4th hand knowledge from a long forgotten podcast haha).
IANAL but to me when I hear horror stories about divorce court settlements and other crazy contract low stories it's not too surprising that the initial ruling on the comp package was made.
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Why not consider capping the hype or other deal structures, in order to demonstrate due diligence to shareholders?
Well those are a minority of shareholders. What happens to the wishes of the 70%?
If you were one of those 30%, the non-commie solution would be to sell your shares and move on.
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Well as I said the first comp package I think everyone laughed initially and didn't take seriously, so lawyers could later poke holes in it by saying that due diligence in line with other public companies was not demonstrated.
This 2nd time around the value of the comp package is well known and they voted again to give it to him- so I don't know how this judge could rule against it but IANAL.
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