Elon Musk is pushing to secure his $56 billion (£43 billion) pay package from Tesla, even as the company’s share price continues to decline.
Tesla has filed an appeal with Delaware’s Supreme Court, seeking to reinstate the record-breaking compensation plan, which would be the largest in U.S. corporate history.
The Delaware Chancery Court has repeatedly blocked the payout, ruling it excessive and arguing that Musk improperly influenced Tesla’s board when the scheme was approved in 2018.
The court rejected the payout last year despite Tesla shareholders voting to approve the package twice.
The appeal comes as Tesla’s shares struggle, following declining sales in key markets and a growing backlash over Musk’s ties to Donald Trump.
Tesla shares erase ‘Trump bump’ as Musk fights for $56bn payout
This week, Tesla’s shares dropped below their pre-election level, wiping out all gains from the anticipated “Trump bump.”
In 2018, Tesla awarded Elon Musk an unprecedented pay package when the company was valued at just $59 billion. The deal was based on Tesla’s revenue multiplying 15-fold and its market capitalization surging to $650 billion.
Today, Tesla is worth $722 billion, though its shares have fallen 53% since December.
At the time, Musk’s performance goals were seen as nearly impossible, but after four years, he achieved them—unlocking 304 million share options, now valued at $69 billion at today’s prices.
The payout represents more than a fifth of Musk’s $307 billion net worth, which is largely tied to his Tesla stake and ownership in SpaceX.
A Tesla shareholder challenged the award in Delaware, where the company is incorporated. Last year, the Chancery Court struck down the package, calling it an “unfathomable sum” that unfairly disadvantaged shareholders.
Tesla resubmitted Elon Musk’s pay package for shareholder approval last year, and investors once again overwhelmingly backed the scheme. However, a judge rejected it for a second time and awarded $345 million in legal fees to the lawyers who brought the case against Tesla.
On Tuesday, Tesla filed an appeal with Delaware’s Supreme Court, seeking to overturn the ruling.
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