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Tesla Faces Shareholder Vote on Musk's $56 Billion Pay Package as Ron Baron Weighs In

Jun 5, 2024, 12:39 PM

Tesla is facing a crucial shareholder vote next week on whether to ratify CEO Elon Musk's $56 billion compensation package. The package, originally approved in 2018, was voided by a Delaware judge, necessitating a new vote. Tesla has defended the proposal, arguing that a new compensation plan would be costlier. Prominent investor Ron Baron has publicly supported the package, stating that Musk has fulfilled his side of the agreement and that Tesla is better with Musk at the helm. Baron, who recently invested $150 million in Musk's AI venture xAI, emphasized the potential of Tesla's robotics business and other ventures. However, some institutional investors and analysts argue against the package, citing concerns over corporate governance and the disproportionate size of the pay deal. The outcome of the vote could significantly impact Tesla's future direction and investor sentiment. Robinhood has been contacting shareholders to vote. Baron appeared on CNBC's Squawk Box on June 5, highlighting that the lawsuit against Musk was initiated by a shareholder with only 9 shares.