"The Delaware Supreme Court has overturned a lower court ruling, reinstating Elon Musk's 2018 compensation package originally valued at $56 billion but now worth approximately $139 billion due to Tesla's soaring stock price. The unanimous decision criticized the prior total rescission as "improper and inequitable," arguing that it left Musk uncompensated for six years of transformative leadership at Tesla. Musk quickly celebrated the outcome on X, stating that he felt "vindicated." He also shared his gratitude to TSLA shareholders."
"In a 49-page ruling Friday, the Delaware Supreme Court reversed Chancellor Kathaleen McCormick's 2024 decision that voided the 2018 package over alleged board conflicts and inadequate shareholder disclosures. The high court acknowledged varying views on liability but agreed rescission was excessive, stating it "leaves Musk uncompensated for his time and efforts over a period of six years.""
"The 2018 plan granted Musk options on about 304 million shares upon hitting aggressive milestones, all of which were achieved ahead of time. Shareholders overwhelmingly approved it initially in 2018 and ratified it once again in 2024 after the Delaware lower court struck it down. The case against Musk's 2018 pay package was filed by plaintiff Richard Tornetta, who held just nine shares when the compensation plan was approved."
The Delaware Supreme Court reversed a lower court ruling and reinstated Elon Musk's 2018 Tesla compensation package, restoring its current value near $139 billion. The high court found a total rescission to be improper and inequitable because it left Musk uncompensated for six years of leadership. The 2018 plan awarded options on roughly 304 million shares tied to aggressive milestones that were met early. Shareholders had overwhelmingly approved the plan in 2018 and ratified it in 2024. The suit was brought by plaintiff Richard Tornetta. Tesla avoided a potential $26 billion earnings hit and has pursued interim hedges and new packages.
Read at TESLARATI
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