[HN Gopher] Tesla directors agree to return $735M following clai...
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Tesla directors agree to return $735M following claims they were
overpaid
Author : thunderbong
Score : 73 points
Date : 2023-07-18 20:10 UTC (2 hours ago)
(HTM) web link (www.engadget.com)
(TXT) w3m dump (www.engadget.com)
| moralestapia wrote:
| >The $735 million settlement will be paid back to Tesla in what's
| called a "derivative lawsuit" -- the largest ever awarded by
| Delaware's Court of Chancerty, according to Reuters.
|
| Musk is really making a good impression there, lol.
| hiddencost wrote:
| They're paying $735 million back to Tesla, after Musk alone took
| out $56 billion?
|
| Seems like a slap on the wrist.
| ajaimk wrote:
| These are 2 different lawsuits.
| [deleted]
| Fezzik wrote:
| It's noted a few sentences in that there is a separate lawsuit
| regarding the $56B...
| [deleted]
| [deleted]
| jonas21 wrote:
| Musk's pay package was tied to TSLA stock hitting certain price
| targets -- if it failed to do so, he wouldn't be paid at all.
| Here's what the NY Times wrote back in 2018 [1]:
|
| > _Tesla is worth only about $59 billion today. If Mr. Musk
| were somehow to increase the value of Tesla to $650 billion --
| a figure many experts would contend is laughably impossible and
| would make Tesla one of the five largest companies in the
| United States, based on current valuations -- his stock award
| could be worth as much as $55 billion._
|
| Well, he managed to do the "laughably impossible" -- Tesla is
| worth over $900 billion today. Shareholders should be thrilled.
|
| [1]
| https://www.nytimes.com/2018/01/23/business/dealbook/tesla-e...
| asdfgiasnio wrote:
| [flagged]
| slashdev wrote:
| What's the crime? This is a really low brow drive by
| comment from an anonymous user.
| vanjajaja1 wrote:
| > It was brought by shareholder Richard Tornette, who claimed
| that "the largest compensation grant in human history" was given
| to Musk, even though he didn't focus entirely on Tesla
|
| Not understanding how this something related to law? Either he
| was given the grant legally, or he wasn't. What does it matter
| how it compares to other people or what percentage of his focus
| was on Tesla?
| wyre wrote:
| It's related to law because shareholders are sueing Musk and
| it's up to the courts to decide if it was granted legally or
| not.
| dghlsakjg wrote:
| The board of directors has a legal responsibility to govern in
| the interest of the shareholders.
|
| The argument is that the board giving $750mm of shareholder
| money to themselves is not in the interest of the shareholders
| for somewhat obvious reasons.
| onlyrealcuzzo wrote:
| But didn't they agree to do it if Tesla's stock got to some
| amount? Shouldn't they have written a limit in if they didn't
| want to exceed a certain amount of compensation?
| dghlsakjg wrote:
| No. That's Musk's personal pay package as CEO. This was
| just stock options that the board gave themselves for their
| services
| bryanlarsen wrote:
| They didn't give directors $750mm of shareholder money. They
| gave about a tenth of that in stock and appreciation did the
| rest.
| mikeryan wrote:
| This is in reference to a different suit. It's for Elons
| comp package not the boards comp.
|
| Even in regards to the boards comp they were stock options
| not stock so the compensation is based on the option strike
| price not just appreciation.
| dghlsakjg wrote:
| Issuing stock still costs existing shareholders money in
| terms of diluted ownership stake
| taeric wrote:
| Seems at least in spirit related to
| https://www.youtube.com/watch?v=Ko8C3surjhM.
|
| Also note for those skimming this is the board of directors. Not
| "directors" in the company. If that makes any sense.
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(page generated 2023-07-18 23:01 UTC)