Musk's 2018 Tesla pay package must be restored, Delaware court rules
CNBC••business
Key Points:
- The Delaware Supreme Court ruled that Elon Musk's 2018 Tesla CEO pay package, valued at approximately $56 billion when vested, must be restored, reversing a lower court's decision to rescind it.
- The court found the lower Court of Chancery's remedy too extreme and criticized it for not allowing Tesla to argue what fair compensation should be, effectively ending the years-long legal battle over Musk's compensation.
- The original 2018 pay plan, consisting of 12 milestone-based stock tranches, was unprecedented and made Musk the richest person globally, but was challenged by shareholder Richard J. Tornetta for alleged fiduciary breaches.
- The Court of Chancery had previously ruled the pay plan was improperly granted due to flawed board approval
