Tesla shareholders reapproved a controversial multimillion-dollar pay package for CEO Elon Musk on Thursday.
The 2018 compensation agreement, which is now reportedly worth more than $45 million, was struck down by a Delaware judge in January. While Thursday’s vote affirms shareholder support for the pay package, it does not resolve the legal challenge.
Chancery Judge Kathaleen McCormick found that the package — which granted Musk a 1 percent stake in the company for each of 12 milestones that were ultimately met — was not negotiated fairly.
Tesla’s board had urged shareholders to once again approve Musk’s pay package in recent weeks.
“We do not agree with what the Delaware Court decided, and we do not think that what the Delaware Court said is how corporate law should or does work,” Robyn Denholm, the chairperson of the board, wrote in a letter to shareholders.
“So we are coming to you now so you can help fix this issue — which is a matter of fundamental fairness and respect to our CEO,” she continued. “You have the chance to reinstate your vote and make it count.”
The approval of the pay package, as well as Tesla’s reincorporation in Texas, were met with cheers at the company’s annual shareholders meeting Thursday.
Musk had previewed the results of the two votes late Wednesday night, announcing on his social media platform X that both were passing with “wide margins.”
“Thanks for your support,” he added.
