Musk could leave Tesla’s command if he doesn’t receive a billion dollars in shares

The president of Tesla warned shareholders that the founder and executive chairman (CEO), Elon Musk, could leave the company if he did not receive a total of one billion dollars (around 860 billion euros) in shares.

Robyn Denholm, who approved the compensation package, wrote in a letter to shareholders, released today, that Musk’s departure would represent a loss of billions of dollars in the company’s stock market value.

“Without Elon, Tesla could lose significant value, as our company may not be valued for what it aspires to become,” he explained.

“If we are unable to foster an environment that motivates Elon to achieve great things through a fair, performance-based compensation plan, we run the risk of seeing him resign from his executive position,” he added.

The president of Tesla, who has been criticized in the past for her closeness to Musk, is making the company’s future dependent on Artificial Intelligence (AI) and encouraged shareholders to approve the remuneration package, although she never indicated its value.

“Tesla shareholders have until midnight on November 5th to vote on the proposal before the annual general meeting of shareholders, which begins on November 6th.

The board, chaired by Denholm, proposes that Tesla compensate Musk with stock options currently valued at one billion dollars.

According to consultancy Glass Lewis, the remuneration package could grant Musk up to 432 million new shares, giving him control of up to 30% of Tesla’s shares, more than double his current stake.

Glass Lewis, along with Institutional Shareholder Services (ISS), are the two main consulting firms that opposed the proposal, angering Musk, who dubbed them “corporate terrorists.”

Glass Lewis and ISS justify their position by pointing out, among other reasons, that the award of the remuneration package leaves the Board of Directors with no room for maneuver, as it “reduces the board’s ability to significantly adjust future remuneration levels”.

In turn, Musk justified his desire to control at least 25% of Tesla’s shares in order to control the “huge army of robots” that the company intends to create.