Tesla shareholders have approved a landmark pay package for CEO Elon Musk and agreed to relocate the company’s official headquarters to Texas.
The deal was blocked earlier this year by a judge in Delaware saying it was unfair to shareholders. Delaware judge Kathaleen McCormick ruled the sum was “unfair” and the process for determining the package, by a board heavily influenced by Mr Musk, was “deeply flawed”.
In the aftermath of the ruling, Mr Musk announced that he would seek to move the firm’s headquarters from Delaware where it is currently incorporated to Texas.
It remains to be seen if the vote will be legally binding but it marks a win for the multi-billionaire who had vigorously advocated for the payout, potentially worth up to $56 billion, depending on the share price of Tesla.
“Hot damn, I love you guys,” he told a crowd of shareholders who had convened in Texas for the firm’s annual meeting.
The deal is worth more than 300 times what the top-earning boss in the US made last year, and more than 3,000 times the average CEO’s pay package.
The staggering amount had drawn criticism and raised concerns that Tesla’s board was too compliant and closely aligned with Mr. Musk.
Tesla’s board insists Mr Musk deserved the package because the carmaker had surpassed its targets under his leadership and that it was necessary to ensure he remains dedicated to the company.
Its executives also backed the pay package saying that Mr Musk was instrumental to the company’s success.
The pay proposal received 72% of the votes cast, similar to the 73% total in 2018, when it was first approved.