Tesla awards CEO Musk USD 29 billion stock months after court scraps pay

Tesla awarded Elon Musk $29 billion worth of stock, months after a court struck down his earlier $56 billion pay. The new shares match terms of the old plan. Musk has appealed, and Tesla is reviewing his compensation

Washington: Tesla is awarding CEO Elon Musk 96 million shares of restricted stock valued at approximately USD29 billion, just six months after a judge ordered the company to revoke his massive pay package.

The electric vehicle maker said in a regulatory filing on Monday that Musk must first pay Tesla USD 23.34 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.

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In December, Delaware Chancellor Kathaleen St Jude McCormick reaffirmed her earlier ruling that Tesla must revoke Musk’s multibillion-dollar pay package. She found that Musk engineered the landmark pay package in sham negotiations with directors who were not independent.

At the time, 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 USD 5 billion. The judge said the attorneys were entitled to a fee award of USD 345 million.

The rulings came in a lawsuit filed by a Tesla stockholder who challenged Musk’s 2018 compensation package. That pay package carried a potential maximum value of about $56 billion, but that sum has fluctuated over the years based on Tesla’s stock price.

Musk appealed the order in March. A month later, Tesla said in a regulatory filing that it was creating a special committee to look at Musk’s compensation as CEO.