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Elon Musk lost his Tesla pay fight. Here's what he can do next.
- Elon Musk's $55 billion pay package was struck down by a Delaware judge for the second time.
- Tesla plans to appeal the decision and if failed may reintroduce the package in Texas.
- However, reintroduction of the package in Texas may end up costing Tesla more as the old package cannot be authorised by the new plan.
- Tesla's board had considered introducing a new pay plan if the shareholder vote didn't pass, which was eventually rejected.
- If Tesla created a new plan with the same stock grants, it would cost tens of billions.
- Legal experts predict that the case will ultimately have to balance Delaware's freedom for companies to self-govern with concerns about excessive payouts and Musk's status.
- Appeals processes take a year or longer, however, Musk's case may contain unpredictable elements.
- The case may signify more about public companies in the US and the way in which shareholders and courts can interfere with management's plans.
- Tesla reincorporated from Delaware to Texas in June which could cause a hindrance in its decisions as its behavior hasn't been the most strategic.
- Musk's decision to appeal or reintroduce the package in Texas depends on multiple factors including motivations beyond money like his public persona and his reputation.
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