Tesla asks shareholders to back $56bn pay for Elon Musk rejected by judge

Elon Musk's $56bn Pay Package Rejected and Revisited

In 2018, Elon Musk's proposed $56 billion pay package was rejected by a Delaware judge in January. The compensation, which included no salary or cash bonus, was based on Tesla's market value rising to as much as $650 billion over the next 10 years. However, the judge nullified the deal, describing the sum as "unfathomable" and unfair to shareholders.

Shareholder Approval Revisited
Tesla has now asked its shareholders to once again approve Musk's record-breaking pay package. This request comes after the Delaware judge's rejection of the original compensation package. The company's filing also includes a letter from the board chairperson, Robyn Denholm, expressing disagreement with the court's decision and its perceived impact on corporate law.

Legal Situation and Compensation
The company has suggested subjecting the original 2018 package to a new shareholder vote, indicating its efforts to bolster support for Musk's pay package and publicly reject the court's decision. Musk's compensation for 2023 was $0, as he does not take a salary from the company and is compensated through stock options.

Company Matters and Market Performance
Tesla has also urged its investors to approve its decision to move the company's state of incorporation from Delaware to Texas. Despite these developments, Tesla has faced challenges this year, failing to meet market expectations and reporting a fall in deliveries for the first time in four years. Musk announced layoffs of around 10% of the company's global workforce, amounting to about 14,000 employees, amid the downturn in sales.

In the broader electric car market, there has been a slowdown in growth, with major manufacturers scaling back their plans and notable companies, like Apple, canceling significant projects in the self-driving electric car space.