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re: Cathy Wood Rips the Delaware Court Finding Voiding Musk's $56B TSLA Compensation
Posted on 2/5/24 at 7:18 am to NC_Tigah
Posted on 2/5/24 at 7:18 am to NC_Tigah
The Judge ruled that Tesla wasn't completely open with the shareholders about what they thought Musk's chances were of reaching the various compensation goals. A pretty ridiculous ruling on its face.
But since you can't go back in time to see if shareholders would have voted against the compensation package given extra information (I seriously doubt they would have), that leaves Tesla and Musk without any kind of reasonable remedy.
So I propose a remedy: Tesla estimates the hypothetical currrent share price if they had replaced Musk with a more mundane CEO by assuming Tesla stock would have performed the same as other auto manufacturers. Offer stock holders a one-time stock buyback opportunity at that price. Since the calculated alternate history price will likely be 25% of actual current stock price (or lower), nobody will accept the offer. Tesla then pays Musk per agreements, and everybody is happy.
But since you can't go back in time to see if shareholders would have voted against the compensation package given extra information (I seriously doubt they would have), that leaves Tesla and Musk without any kind of reasonable remedy.
So I propose a remedy: Tesla estimates the hypothetical currrent share price if they had replaced Musk with a more mundane CEO by assuming Tesla stock would have performed the same as other auto manufacturers. Offer stock holders a one-time stock buyback opportunity at that price. Since the calculated alternate history price will likely be 25% of actual current stock price (or lower), nobody will accept the offer. Tesla then pays Musk per agreements, and everybody is happy.
This post was edited on 2/5/24 at 7:19 am
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