I should probably look this up somewhere on the net, but here goes anyway: What was the basis for Elon not receiving his stock award?
As I understand it, he and the stock holders made an agreement some years ago, that entitled Elon to a certain amount depending on how the stock performed. It turns out the stock performed really well, entitling Elon him to a really, really big bonus. I get that this is somewhat weird given that people are being fired and that Tesla is currently not able to sell their cars at the same rate as they are being produced. But is this enough to withhold the bonus? Are there some aspects of the agreement that Elon did not adhere to? From my point of view it looks like Elon was simply able to make a really good deal with the shareholders.
A judge found that the bonus was awarded basically by Elon to himself, so it was invalidated. Technically it was awarded by the board, but at a time when Elon had extreme control over them.
> Musk controlled only 21.9% of Tesla’s voting power, so he lacked mathematical voting control...
> Defendants sought to prove otherwise, and they generally contend that the stockholder vote was fully informed because the most important facts about the Grant—the economic terms—were disclosed...
Basically, the shareholders voted on the grant while having a full understanding of the economic terms. It was awarded by musk, to musk, with approval of the shareholders and (supposedly overly friendly) board.
It really makes it sound like the judge might have been wrong based on the sequence of events we have now, which is:
1. The shareholders approve a stock grant on economic terms
2. A judge says "If the shareholders knew everything, they wouldn't have approved that"
3. The shareholders, now knowing everything, approve it again despite it having almost no benefit now
That really really makes it sound like the shareholders did in fact want to approve it in 1, and so the information they didn't know wasn't all that important, was it?
I know it's a different set of shareholders then and now, but still...
> A judge says "If the shareholders knew everything, they wouldn't have approved that"
That's not what the judge said. It's more like "this award didn't follow the requirements for such an award for a corporation in Delaware". It doesn't at all depend on some prediction about what the shareholders would or wouldn't do in other hypothetical scenarios.
Tesla stocks have a lot of hype especially from Cathie of Ark. Nearly everywhere from spams to YT to FB, you have a lot of "ads" to promote Tesla. Anything EVs good news straight away related to "Tesla" even if it is about Toyota or BYD bad news, seems like Tesla getting credit instead. At current stage I am convince somekind of coordinated and multi layered pump and dump is happening. We are at the "pump" stage. Anyone doing a decent research will see Tesla has near no moat unlike Apple, Nvidia or Microsoft. No battery factory. No owning any lithium mine. No gpu productions. Factories depend heavily on China grace. High churn of employees. Solarcity gone. Autopilot rebranded as FSD which is not even reaching 3.0 after half a decade of promises. CyberTruck design are joke. Any trainees working in BMW or BYD can design a better CyberTruck. Gigafactory? Hahaha...you got a chance take a look BYD factories. Even Taobao warehouses will make Amazon warehouse look like medieval setup. There are Chinese factories that look more like Star Trek than ANY gigfactory. Just ride the hype part and make sure you do the dump earlier before the actual dump happening by the elites.
They get a 10% dilution, so you will probably see many lawsuits. Specially connected and within the institutional investors and funds, that changed their mind at the last minute. What made them change their mind at the last minute? Any promises of stakes on xAI?
Because Cathie Wood fund is a major shareholder, but has a stake on XAI, as she reluctantly admitted on CNBC.
From the case details below, even if it romanticizes a little bit the Tesla journey, while forgetting the more than 5 Billion in government subsidies, his companies received until 2015, is pretty clear there is no Corporate Governance at Tesla. At least not as you learn about when studying for a MBA :-)
The board and compensation committee are is long time friends, his accountant, his brother and so on. If Tesla shareholders are willing to invest in the company, it's their money. Delaware law exists to enforce shareholders protection for all shareholders, so they can continue to choose it as an ideal location to incorporate a company.
This case also raises serious issues of what real companies governance means, and specially in public companies. Not only for Tesla but for many other companies. Explains why in general, CEO and Board Level compensation, continues to raise at a pace that obfuscates the raises of normal workers.
It's governance by checklist. By it's not much different from a CEO, who would decide to blow 100 million on a Las Vegas party using corporate funds, or hire his family, under the the threat of leaving the company, or tanking the share price. If shareholders vote for it...
> From the case details below, even if it romanticizes a little bit the Tesla journey, while forgetting the more than 5 Billion in government subsidies, his companies received until 2015, is pretty clear there is no Corporate Governance at Tesla. At least not as you learn about when studying for a MBA :-)
Why do government subsidies get brought up so often as if those alone are to credit for the success of Tesla and SpaceX. As if the other companies in the same space do not get them.
Because it is informative about his true intentions when he talks about going to Mars. He is not stupid enough to think that we currently have the capability of building a Mars colony that would be even remotely close to sustainable in the face of a global disaster on Earth.
Rather, it's quite obvious he's a modern day Ross Perot who has perfected billowing up his companies on the taxpayer dime. And a manned trip to Mars represents the fattest international contract the world has ever seen.
If he bamboozles the world into financing this interplanetary field trip, he's going to personally end up with a net worth in the trillions...
Does anybody remember mega bailouts of 2008 still? There are so many companies that arguably won't exist without those. And that's only one example, there are massive subsidies, tax breaks, preferences, etc in a ton of industries. I mean, some think it's a good thing, it's helping - ok fine. But each time Musk is mentioned it's "oh he got subsidies" as if it were in any way unique and special. He's playing exactly the same game literally every other company is playing. You hate the game - fine, yoh like the game - fine, but you cannot honestly be ok with the game and single out Musk for playing it by the same rules as others do.
Likely shareholder equity would be wiped out and they’d reorganize. Isn’t the whole deal that investors get the upsides for taking the risks on the down?
You can think of him whatever you want, but he's an investor money magnet like noone else. Everyone who owns stock of any company would want him. He could probably take over some fruit juice company and do nothing while it's valuation would still increase like crazy.
I own stocks of several companies and I definitely hope he stays as far away from them as possible. He is a man-child into alt-right and antivax conspiracy theories, this is toxic to any brand unless you are selling to the MAGA crowd.
The irony is, there are plenty of products and brands that absolutely would like to sell to the MAGA crowd, but you would not expect electric cars to be one of them, especially as their presidential candidate announced that he would ban them.
I really think people should stop saying "alt right" for anyone more conservative than Bernie Sanders. Alt right is an actual thing, and the trick of calling a mild thing an awful thing stopped working a few years ago.
Elon has retweeted things about The Great Replacement and anti-vax conspiracies. He is very much on the alt right, not "slightly right of Bernie Sanders".
Hard to know without citations what that means in practice. And retweets? I don't know. I like every YouTube video I watch regardless of whether I like it, so I know what I've watched.
Things that you could do accidentally with a thumbslip should only have a certain weight attached, and being quick to reach for a description that includes people who want Jewish people dead should be done cautiously.
> Everyone who owns stock of any company would want him.
Of course they would: from financing his own private vendettas (using Tesla to finance his Twitter acquisition) to rerouting GPUs ordered by Tesla to Twitter, who wouldn't want Musk to do that?
If you believe a significant amount of the stock value is due to Elon himself, and he's likely to leave the company if the stocks were not awarded it can make sense. So basically if current value - stock award > value without Elon.
He didn not create $ 450B in value. What does that even mean. Maybe he helped to create $ 450B of hype-dollars, but this is not real money, and for certain not "value". And let's not forget that the people doing the real, hard work are not seeing any of this "value" while he cashes real hard cash.
The market cap of a company is not real money. However, owning a significant share of the shares can help rich people get real money without any real downsides. For example, Musk (any most billionaires) use their stock as collateral and take out super low interest loans against that stock. They don't pay any income tax on this loan, since it's not income. On the contrary, they can deduct the interest rate payments from their tax bill.
This money they then use to buy property and other wealth. So, they make more money with not really their money (debt) and they use all tricks in the book to minimize their tax burden - which is much lower compared to (relatively speaking) low and middle class folks who earn most of their money through income and pay high income taxes.
So, you see, even though his pay package is in Tesla stock and its value therefore "not real", he uses it to get very real cash using it. In finance this is called "leverage".
You said not seeing "any value". If you said it was very far apart I wouldn't have commented. But employees do benefit in a small part from the company growing.
In 2018, Tesla employed ~ 14800 people, 56 billion divided by 14800 = 3783783. So apparently in 2018, for every staff member he apparently added ~ $3.7 million dollars worth of value that he should be compensated for in the form of a bonus?
Why do you assume that increased value comes purely from employees?
If Musk buys a robot that can weld a body 2x more efficient (installed and maintained by an external vendor), increasing the value of the company, which employee created that value?
He makes the 'real' decisions daily that the company succeeds or fails by. I guess we can play games all day of what 'real' is. Though 'real hard cash' is a crap store of value. Let's graph the value of the dollar versus the value of Tesla stock over 20 years.
The fact that top managers receive a ton of cash because they make "decisions" and "bear the responsible" is bullshit made up by billionaires to justify their ridiculousy high incomes and wealth. In fact, they don't give two shits about their responsibility - they cash in as much as they can for a few years, and if things go south, they jump ship to the next one.
Of course, Musk is not a typical career CEO. But still, he has a serious interest that his contribution to the path of Tesla is extremely overrated.
Sure, but the market cap of the stock doesn't mean that this is some kind of real money or value (using value in the sense of value for society etc., not "valuation of the company). It's fictional. If everyone tried to cash out, that market cap would go to zero faster than Musk can whip out his dick on his G-5.
You are projecting you own views and opinions on a metric and language that is completely standard in business and investing. You are free to do that but it will not make you win any arguments.
