Tesla awarded CEO Elon Musk 96 million shares of restricted stock valued at approximately $29 billion, just six months after a judge ordered the company to revoke his massive pay package.
The electric vehicle maker said in a regulatory filing Monday that Musk must first pay Tesla $23.34 per share of restricted stock that vests, which is equal to the exercise price per share of the 2018 pay package that was awarded to the company's CEO.
In December, Delaware Chancellor Kathaleen St. Jude McCormick reaffirmed her earlier ruling that Tesla must revoke Musk's multibillion-dollar pay package. She found that Musk engineered the landmark pay package in sham negotiations with directors who were not independent.
Elon Musk speaks Feb. 20Â at the Conservative Political Action Conference in Oxon Hill, Md.Â
At the time McCormick also rejected an equally unprecedented and massive fee request by plaintiff attorneys, who argued they were entitled to legal fees in the form of Tesla stock valued at more than $5 billion. The judge said the attorneys were entitled to a fee award of $345 million.
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The rulings came in a lawsuit filed by a Tesla stockholder who challenged Musk's 2018 compensation package.
That pay package carried a potential maximum value of about $56 billion, but that sum fluctuated over the years based on Tesla's stock price.
Musk appealed the order in March. A month later Tesla said in a regulatory filing that it would create a special committee to look at Musk's compensation as CEO.
In a letter to shareholders, Tesla's board said that Musk hasn't received "meaningful compensation" for eight years, citing the 2012 CEO Performance Award that was last earned in 2017. The board argued that Musk deserves compensation because he's delivered "transformative and unprecedented growth" that's "translated into immense value generated for Tesla and all our shareholders."
Musk has been one of the richest people in the world for several years.
Wedbush analyst Dan Ives feels Musk's stock award may alleviate some Tesla shareholder concerns.
"We believe this grant will now keep Musk as CEO of Tesla at least until 2030 and removes an overhang on the stock," Ives wrote in a client note. "Musk remains Tesla's big asset and this comp issue has been a constant concern of shareholders once the Delaware soap opera began."
People visit the Tesla booth July 18Â during the 3rd China International Supply Chain Expo at the China International Exhibition Center in Beijing.Â
Tesla shares plunged 25% this year, largely due to blowback over Musk's affiliation with President Donald Trump. But Tesla also faces intensifying competition from both the big Detroit automakers and from China.
In its most recent quarter, Tesla reported that quarterly profits plunged from $1.39 billion to $409 million. Revenue also fell and the company fell short of even the lowered expectations on Wall Street.
Under pressure from shareholders last month, Tesla scheduled an annual shareholders meeting for November to comply with Texas state law.
A group of more than 20 Tesla shareholders said in a letter to the company that it needed to at least provide public notice of the annual meeting.
Investors are increasingly worried about the direction of the company after Musk spent so much time in Washington this year, becoming one of the most prominent officials in the Trump administration in its bid to slash the size of the U.S. government.
