Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[Drumheller]

I feel like this judge may be of shady character. Since feelings are now more important than facts, she should be immediately removed from her office.

 

[Krugerrand]

As a shareholder (with 98+% of my financial wealth in $TSLA) I will not vote on an X poll by Elon given his main usage of the social network.

Such polls could be made by the @Tesla X account, or a Tesla IR account, or via ir.tesla.com using the "verified shareholder" status they recently created – please don't tell me that new thing is just for marketing, Elon would not tolerate that!

The vast majority of Elon's posts are highly political and he's said he's actively fighting a war against civilization with/on X. I'm not willing to join his crusade, play by his game, under his rules. Tesla is a company with a mission. That's why I'm a shareholder. If Elon wanted to use X for business matters, he would use the X business features made for organizations. One of which allows a CEO to create posts/polls by their organization: How to use the Teams feature on PostDeck. Elon must know that, right? Why not use it? He must prefer to mix political opinions with Tesla. Don't be suprised that he's getting his biases confirmed by personal fans, as he likes them. He'll to get his social bubble further filtered, and probably find more reasons to fight the civilizational war…

Isn't it funny to hear the judge say mixing a company board with friends with insufficient care for independence is a problem (Elon != Tesla Inc), and then hear Elon's fans claim that his private social network is the right place to poll shareholders?

Good luck trying to build and maintain wide, open and passionate Tesla community of customers and shareholders. Profits help but they aren't the end of the game (neither are they Tesla's mission).

Just as there is such a thing as a bad student, a bad customer; you’re a bad shareholder.

 

[SO16]

Pretty good explanation of the court case.

Elon Musk LOSES $55 BILLION. What Now?

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[OrthoSurg]

Great day for Tesla and TSLA! If this stops Elon from getting another comp package then we will be better off. He made his choice when he purchased the bird, selling TSLA and diverting engineers

The guy sacrificied so much building this company and openely said he needed the money to make human speech multiplanetary. Would you work in a company you started for the rest of your life without compensatory package?

 

[Artful Dodger]

Does it make up to $55 billion available as a buyback?

No, because Elon's 2018 compensation plan was never a cash award, it was in stock options which have some market value (less taxes and shenanigans like we're seeing from MalDelaware).

As @The Accountant informed us, there could be some $2-ish B freed up which Tesla had allocated for expenses related to those taxes, but that's peanuts, and not money Tesla's Board would immediately reallocate to buybacks.

 

[mspohr]

Elon Musk's $55 billion Tesla CEO compensation gets voided by judge

A Delaware judge has sided with Tesla shareholders who filed a lawsuit claiming that Elon Musk unjustly secured a $55...

electrek.co

This posttrial decision enters judgment for the plaintiff, finding that the compensation plan is subject to review under the entire fairness standard, the defendants bore the burden of proving that the compensation plan was fair, and they failed to meet their burden.

The collection of features characterizing Musk’s relationship with Tesla and its directors gave him enormous influence over Tesla. In addition to his 21.9% equity stake, Musk was the paradigmatic “Superstar CEO,” who held some of the most influential corporate positions (CEO, Chair, and founder), enjoyed thick ties with the directors tasked with negotiating on behalf of Tesla, and dominated the process that led to board approval of his compensation plan. At least as to this transaction, Musk controlled Tesla.

The process leading to the approval of Musk’s compensation plan was deeply flawed. Musk had extensive ties with the persons tasked with negotiating on Tesla’s behalf. He had a 15-year relationship with the compensation committee chair, Ira Ehrenpreis. The other compensation committee member placed on the working group, Antonio Gracias, had business relationships with Musk dating back over 20 years, as well as the sort of personal relationship that had him vacationing with Musk’s family on a regular basis. The working group included management members who were beholden to Musk, such as General Counsel Todd Maron who was Musk’s former divorce attorney and whose admiration for Musk moved him to tears during his deposition. In fact, Maron was a primary gobetween Musk and the committee, and it is unclear on whose side Maron viewed himself. Yet many of the documents cited by the defendants as proof of a fair process were drafted by Maron.

 

[unk45]

No argument with anything you said. In a way, the judge leaned over backwards: He (she?) was looking for any valid excuse not to mess with Tesla. Independent board; nope. Even with a non-independent board, if the board members doing the deed were actually doing their job, then no problem with the compensation. But nobody took the kind of notes that would show that; in fact, while looking at the whole process, it could easily be construed to show the opposite of that. A review of other companies that was documented and discussed would have had the lawsuit thrown out of the court. There were lots of outs for Tesla; some 50-60 pages of the decision, at least, was talking about those outs and why Tesla didn't qualify for any of them.

Instead, it truly seemed that it was completely, "Whatever Musk says, we're good with it." Even with Musk at points lowering his ask; it wasn't the board asking him to lower the ask, it was Musk! Which, in a weird way, is good - it appears that Musk was truly not trying to hurt shareholders. But any proof that he wasn't simply wasn't in the record. No t's crossed, no i's dotted.

Any reasonable proof, such as contemporaneous notes by board members, a secretary sending out meeting notes, a comparison document looking at other CEO's with (probably, reasons why those other CEO's compensation didn't apply) would have gotten Musk and the board off the hook.

I mean: if the board members had been truly independent, then all that stuff I said above wouldn't have mattered.

The plaintiffs in the case had a lot of hurdles to get over before the judge had to take action. The whole business was an "own-goal" by both Tesla and Musk.

Weird thing, though: In the absence of proof, either way, of Musk and Tesla actually cheating shareholders, the judge appeared to be required to take Musk/the board's actions in the worst light. But if one looks at what little Musk and the board were saying to one another, one could take what brief things they were saying to each other to be pro-shareholder.

Interesting what happens to all this when it hits the appeals courts.

There is only one the Delaware Supreme Court. Your reading concentrates on the negative light cast on every decision. It also ignores the factual definition of Independent Director. All it means is not an
employee of the company. Were the measure to be not friends of CEO many US boards would be denuded.


Even the documentation question has numerous dismissals of actual conduct. She makes much of lack of written documentation of comparable companies. Name one, anybody. Once you find one check out corporate governance. In this case note it appears that normal shareholders did not participate, just people who bought shares to be entitled to file suit.

I do remember how for decades there have been corporate gadflies in the US who buy a share in order to raise their particular pet peeve, ore recently they tend to file class actions or independent actions in efforts to extract some fearsome settlement. This one seems to be typical.

This judge has not been kind to Delaware public companies. Before her their rulings tended to lean in favor of registrants. Prima facie questions do include both her law school and her judicial outlook. In short, this is NOT the Delaware Chancery Court of old times.

 

[Artful Dodger]

It’s not like nobody knew about Elon’s relationships with everyone on the board. It was common knowledge.

Indeed, those same shareholders elected those Board Members, and continued to re-elect them all the while their share when up 20x in value.

Ironic part? The Chancery Court has 'fixed' this non-existant problem so that Elon is the only party who isn't compensated by his 2018 Compensation plan.

They say Justice is Blind; I say it's also Lame.

 

[cliff harris]

Its amazing the way rivals in the west have tried to stop Tesla:

• Decry them as having bad build quality
• Try to force the workers to unionize
• Actually BAN them from selling cars to their customers direct
• Spread rumours about every accident involving a Tesla
• Bribe politicians to proclaim that they are not EV leaders
• Short the stock extensively to try and force bankruptcy
• Try to prevent the CEO from actually being paid so he quits

Meanwhile the chinese do this

• Watch eveything Tesla does, and copy it.

One of these two groups knows what they are doing. The other is a short termist clown car that will clearly fail...

 

[EQC_]

...

If Board's judgemental is so suspect, Delaware needs to cancel every shareholder vote that went the direction of the Board's recommendation...

Don't tempt them!

 

[unk45]

Index funds are passive in that managers do not actively decide what stocks to buy or sell and instead match the weighting of the index. I don't believe they're required to vote for the board's recommendations, and a quick search finds Manhattan Institute has written about how "Index Funds Have Too Much Voting Power" perhaps with their potential bias against ESG intents of the fund managers influencing votes. If that's true, do environmental, social, or governance issues always align with Tesla board recommendations and long-term shareholders?

Tesla does badly on ESG, just as several oil companies do well. ESG is a measure of how much a company amy e affected by climate change, and has zero, nada, nothing to do with quality of environmental measures by the company. Even ESG promotions do not emphasize that fact, but pretend otherwise.

 

[TesLeif]

Wow, 36 disagrees (100% of respondents)... impressive!

Now 50... and still 100%.

 

[dhanson865]

Too bad the truck needs to be charged after 10 minutes of hauling and then takes 6 hours to charge.

That video was 24 seconds long show me proof that a cybertruck can haul for more than 24 seconds. /s

 

[Artful Dodger]

Boeing CEO Dave Calhoun who works from homes in New Hampshire and South Carolina

So yer sayin' I should buy 9 shares of Boeing? That doesn't sound right...

 

[Webeevdrivers]

Re supercharger usage. Our ford salesman that showed us the lightning reached out and indicated they were informed that ford would be shipping tesla adapters for free to all Lightning and Mach E owners starting within the next 6 weeks. I see this doing two things.

1. Generating some additional supercharger revenue at a lot of highly under utilized superchargers.

2. Giving ford EV sales a kick. Our sales guy said he had a list of people who were holding off with buying a lightning until they knew they could use superchargers.

Cheers.

 

[Artful Dodger]

Agreed. I’m 99% sure Facebook has a dual class share structure.

Created before being added to the Exchange. Google also has dual classes; not allowed in the S&P 500 Index but their pre-existing status was granted an exemption because their Mkt Cap is so large and they belong in the NDX.

 

[NicoV]

2. Giving ford EV sales a kick. Our sales guy said he had a list of people who were holding off with buying a lightning until they knew they could use superchargers.

Wait until they realise it’s a hassle to use an adapter. A minor one in case of the CCS adapter for the Model S/X, a major hassle for the bazooka that is the Chademo adapter.
I’m glad I don’t need that CCS adapter anymore now that I have a new Model S.

 

[coolmanfever]

Since Elon Musk’s $56 billion Tesla pay package overruled by Delaware court, does that mean he will never get the 25% of TSLA stock that is demanding?

 

[SOULPEDL]

As a shareholder (with 98+% of my financial wealth in $TSLA) I will not vote on an X poll by Elon given his main usage of the social network.

Such polls could be made by the @Tesla X account, or a Tesla IR account, or via ir.tesla.com using the "verified shareholder" status they recently created – please don't tell me that new thing is just for marketing, Elon would not tolerate that!

The vast majority of Elon's posts are highly political and he's said he's actively fighting a war against civilization with/on X. I'm not willing to join his crusade, play by his game, under his rules. Tesla is a company with a mission. That's why I'm a shareholder. If Elon wanted to use X for business matters, he would use the X business features made for organizations. One of which allows a CEO to create posts/polls by their organization: How to use the Teams feature on PostDeck. Elon must know that, right? Why not use it? He must prefer to mix political opinions with Tesla. Don't be suprised that he's getting his biases confirmed by personal fans, as he likes them. He'll to get his social bubble further filtered, and probably find more reasons to fight the civilizational war…

Isn't it funny to hear the judge say mixing a company board with friends with insufficient care for independence is a problem (Elon != Tesla Inc), and then hear Elon's fans claim that his private social network is the right place to poll shareholders?

Good luck trying to build and maintain wide, open and passionate Tesla community of customers and shareholders. Profits help but they aren't the end of the game (neither are they Tesla's mission).

Oh somebody's gonna be upset if TSLA becomes part of X.

This won't be unexpected, and I'm kinda looking forward to it, if it happens. We are part of the same crusade with Tesla. It's all related from the start - all fighting status quo.

Besides, I would not know where to invest outside of TSLA. It's all so complicated and political, at least I know what's going on with Tesla. NVidia looked good for a while there, but how would I know if someone isn't creating a competing AI matrix-crunching server right now? With Tesla, I know where they stand in the Automotive industry. Even in China.

 

[Webeevdrivers]

Wait until they realise it’s a hassle to use an adapter. A minor one in case of the CCS adapter for the Model S/X, a major hassle for the bazooka that is the Chademo adapter.
I’m glad I don’t need that CCS adapter anymore now that I have a new Model S.

I’ve seen the NACS to CCS adapter. It’s not that big. Comparable to the CCS adapter for teslas.