Elon Musk left after meeting with Indian Prime Minister Narendra Modi on February 13, 2025.
Nathan Howard | Reuters
One represents Tesla and Elon Musk Drafting a bill.
Proposed legislation drafted by Richards, Layton and RLF will amend the Delaware General Corporate Law, which, if adopted, could be restored to Musk in Tesla The 2018 CEO Salary Package paves the way for billions of dollars in options.
RLF confirmed that they were involved in CNBC.
“Legal changes have been the core principle of Delaware for more than a century and ensure that Delaware remains a distinguished state of establishment,” RLF President Lisa Schmidt said in a statement. jurisdiction.”
The bill was introduced to the Delaware Convention on Monday and requires approval from two chambers of the state and Gov. Matt Meyer before it becomes law.
The 2018 Tesla salary package awarded to Musk was the largest CEO compensation program in public companies’ history, but the Delaware court revoked the program last year.
Prime Minister Kathaleen McCormick wrote in her ruling that the compensation plan was improperly set by the Tesla board, which was controlled by Musk and misled by Tesla’s agent material Shareholders approve it and then ask them to vote.
Boston College law professor Brian JM Quinn said Musk is no longer considered Tesla’s “controller” under the proposed legislation. Quinn said transactions involving self-trading with controllers or directors would be less scrutinized than they are now. These deals range from private transactions to mergers and acquisitions as well as board and executive compensation decisions.
“The real role of the company law is to protect minority investors,” Quinn said. “With this bill, the legislature said ‘Now what do you know? Protect them less.'”
The proposed legislation will also limit documents that a few stakeholders can obtain through the “books and records” inspection request, Quinn said. Quinn said these stakeholders will be limited to formal projects, such as company merger certificates or shareholder meetings, but they will lose access to informal communications (such as emails or other messages between board members and executives).
After ruling the court’s ruling last year, Musk began a campaign against the Delaware-based company and put its business on the company’s site. Outside. His anger at Prime Minister McCormick repeatedly devalued posts about her on his social network X.
Other notable executives, including Coinbase CEO Brian Armstrong and Pershing Square’s Bill Ackman, also criticized the Delaware judiciary.
Renee Zaytsev, partner of Boies Schiller and co-chair of the company’s securities and shareholder dispute practices, said: “Delaware has paid a huge amount of money for the alleged deals to the controllers.” The effort.”
“These amendments appear to be a course correction, which will make it easier for the board and controllers to avoid judicial scrutiny of transactions,” she said.
Tesla and Musk did not respond to requests for comment.
