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These have been some actual banner days for Elon Musk. He burned down most of his $44 billion funding in Twitter. He drove remaining advertisers away together with his antisemitism. Then he went right into a snit on stage and informed these advertisers to go f**okay themselves. Now he’s frosting that cake with a each day dose of horrifying racism and taking a while to sneer at disabled people.
Oh, and he lastly acquired out the CyberTruck. 4 years late. With half the promised vary. Far above the promised value. And a drawback with snow.
All of which makes it a wonderful time for Musk to tell the Tesla board that until they provide him one other $80 billion in shares, he’ll take his large mind elsewhere.
As The New York Occasions reviews, Musk’s risk was delivered the best way all his enterprise offers are made nowadays: with a sequence of sloppy posts on social media. In a Monday put up to X, Musk informed the board at Tesla that he must personal 25% of the corporate in order that he can have sufficient management of their developments in AI and robotics. In any other case, Musk says he’ll “construct merchandise outdoors of Tesla.”
To be clear, Musk as soon as held much more Tesla inventory, however he’s been promoting it off over the previous few years, together with some situations the place he appeared to profit from insider data, to drop billions into his checking account. Now he needs the corporate to offer him about 12% of the remaining inventory. Simply because.
The risk right here appears to be that Musk will shift his consideration to one of many different corporations the place he’s inconceivably allowed to be CEO on the identical time he’s working Tesla. This most likely means the X.AI startup he conveniently created simply final 12 months and that he claims will “perceive the true nature of the universe.” Precisely how X.AI would get all the brand new stuff and Tesla could be caught, unable to make use of its supercomputer and robotics lab, is unclear.
Additionally, Musk’s monitor file on this subject shouldn’t be precisely stellar.
What’s happening right here might have little connection to something Musk has talked about in his posts. And even to AI. Musk might be making this extortion risk as a result of the richest man on the earth is at risk of shedding an enormous chunk of his wealth.
There’s a case in Delaware’s Courtroom of Chancery that’s wanting into the massive package deal of inventory, inventory choices, and pay that helped make Musk so rich within the first place. That case is how Musk used his place as the most important shareholder and CEO to dominate the Tesla board and award himself a $55 billion compensation package deal in 2018.
Although the video ends with Musk making an attempt to get the case dismissed, that didn’t occur. As a substitute, the choose has questioned whether or not Tesla despatched deceptive data to shareholders. That features the truth that the Musk compensation plan wasn’t thought up by the board of administrators, it was “dictated” to them by Musk. The board might have additionally hidden connections between Musk and board members. (One of many board members is Musk’s brother—that one was most likely apparent.)
In a five-day trial, Musk testified that he wanted that pay package deal as a result of, “It is a technique to get humanity to Mars. So Tesla can help in doubtlessly reaching that.” It doesn’t matter what anybody thinks of Musk’s house ambitions, that’s not an argument that’s more likely to be all that persuasive in convincing a chancery choose. It additionally won’t be that pleasing to Tesla shareholders who’re extra involved concerning the firm that Musk apparently sees as only a means to an finish.
Musk might lose this case.
Ought to the choose strike down Musk’s compensation package deal, Musk might see one other large hit to his backside line. $44 billion right here. $55 billion there. Finally, it provides as much as actual cash.
The 12% of inventory that Musk is asking for to maintain him down on the Tesla farm additionally occurs to be what was in that compensation package deal. So Musk could also be establishing a state of affairs the place the board has a motive to offer him again what he’s misplaced, assuming he loses it. If that occurs, Musk might promote the supposed mental property of X.AI to Tesla, with the board handing him all that inventory in alternate.
Such a transfer would nearly definitely end in extra lawsuits. However hey, Musk would have the cash in his pocket once more. And that might permit him to return to no matter else he needs to do whereas that case grinds by the courts.
And he does have issues to do. The largest thought on Elon Musk’s thoughts nowadays doesn’t appear to be house or EVs. As a substitute, it’s his hatred for variety packages. Musk referred to as makes an attempt to see that fifty% of these in pilot coaching are both ladies or folks of colour “insane.” He slammed the FAA for incapacity hiring targets, claimed that airways and companies are placing DEI above passenger security, and declared that the drawback with Boeing is that it doesn’t rent sufficient white males. That’s along with heavy-duty racism like agreeing that college students from traditionally Black schools and universities have decrease IQs and should not be allowed to turn into pilots.
“Individuals will die over DEI,” tweeted Musk. He most likely thought that was genius.
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