I'll say it again: If Musk does that, it's a breach of fiduciary duty to Tesla. A board could theoretically permit it, but this board has not done so - and would be questioned for its independence if it did. But the threat of it being so obvious -
Let me put it in concrete terms. Under current law, given stock exchange listing rules, Elon Musk can only get his 25% voting control over Tesla if he's given 25% of the equity. If these laws go into place, the board can "contract" with him to give him control over decisions regardless of whether shareholders vote him and other board members out.
My mother uses wheelchair service. You wait 20 minutes to find someone to push the wheelchair into the airport, and another 30-45 minutes for someone to take you to the gate. These aren't motorized wheelchairs; someone has to push you. What possible reason would you have for faking a need?
Feminists taught me that Mad Max Fury Road is not a feminist movie. I get that.
Fury Road was just an action movie where the violent protagonist was a woman with a visible disability, instead of an able bodied man. I get that.
But I still enjoy the fact that George Miller looked at all the dudes that got angry that a woman was the star of a Mad Max movie, and said "Cry about it!" and doubled down.
For the love of god, we know Musk was angry at Delaware - not just because of his comp, but also because of Twitter - and he tweeted angrily about moving.
Of course he wants another $56 billion or whatever the stock is worth today, and of course his board friends who invest in his private companies and do drugs with him are going to accommodate that.
And of course they hired stellar attorneys who will do their best to paper that decision. But does a court, entertaining all of this, have to accept that at face value, or can it instead acknowledge what we all know, which is - there is no way
no matter what the company says in its proxy, that a board would have of its own accord all by itself decided "Yes, we should move to Texas, which has uncertain law and looks to Delaware, bc Tesla is all in on Texas?"
Do we have to believe that an independent special committee of one decided, all by herself, and with absolutely no outside pressure, that yes, it's in the best interests of Tesla to give Musk stock for work he already performed and likely would have performed anyway?
And by the way I do have to reiterate: Tesla's proxy, and the spec comm report, imply that this will save costs that would come with a new pay package. But does that mean there won't be a new pay package going forward?
So if shareholders vote in favor of all of this, the real question for the court is: do they have to ignore all the extrinsic evidence, all the circumstances that led up to this, and pretend to believe the proxy filing? Or can they say what I'm pretty sure most spectators say -
I'll add: the point of this thread is that the entire set of circumstances leading to this vote suggests bad faith by the board, which means the entire proxy is essentially a lie.
But I don't know how much a court can consider all of that when weighing the effects of a stockholder vote.