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

[Oil4AsphaultOnly]

An increase in share price doesn’t benefit you unless you sell, and you probably don’t want those big early investors selling lol — they are much more concerned about things like share dilution and fundamental underpinnings rather than stock price movements, they’re looking further out.

People are harping on about this one individual shareholder madlad who brought the lawsuit but ignoring the $320billion California State Teachers’ Retirement System and other institutional organizations who were also voicing concerns.

The CalPERS owned over 200,000 shares (pre-split) at the end of 2018, which was worth about $60M at the time and $555M now (at $185/share). It was a tiny part of the fund. If they voted against the compensation package, they weren't alone, BUT they got out-voted by retail AND other institutional investors (73% of non-Musk shares voted to approve - tsla-8k_20180321.htm).

Just because some investors didn't get their way, doesn't mean that their opinions weren't heard. It just meant that more people disagreed with them.

 

[Matias]

It means:

Sorry for being obtuse (and english is not my first language), but how can Musk keep the shares which he got trough options, if court overrules option program?

 

[Matias]

Presumably that he hasn't exercised any of the $55 billion in options.

But he has excercised some of those options.

edit: apparently he has not.

 

[Artful Dodger]

institutional shareholders might view this as the company trying to escape the arm of corporate law.

Nah not going to happen

Hawh, the judge herself wrote that Tesla can redo the compensation package. No limits there.

 

[TSLA_Hopeful]

While I support Elon getting the shares, he should strongly be disincentivized to tank the stock. According to the last proxy statement he has 400M shares of Tesla with 238M pledged to collateral. He’s kinda trapped.

 

[Singuy]

But he has excercised some of those options.

Boomermama looked into this and the options exercised so far were from his 2012 compensation plan, not 2018. So Elon does not need to pay anyone back.

 

[AndrewZ]

The CalPERS owned over 200,000 shares (pre-split) at the end of 2018, which was worth about $60M at the time and $555M now (at $185/share). It was a tiny part of the fund. If they voted against the compensation package, they weren't alone, BUT they got out-voted by retail AND other institutional investors (73% of non-Musk shares voted to approve - tsla-8k_20180321.htm).

Just because some investors didn't get their way, doesn't mean that their opinions weren't heard. It just meant that more people disagreed with them.

The judgment here is that those other shareholders were misled, and yeah they certainly werent the only parties objecting at the time whether public or not.

@ the milestones being impossible to achieve, the judgment states that three of the operational milestones were already in Tesla’s projections at the time of Grant award and they had a 70% probability some of the milestones would be achieved soon after award — you can find this at the bottom of Page 185 and onto Page 186.

 

[Matias]

Boomermama looked into this and the options exercised so far were from his 2012 compensation plan, not 2018. So Elon does not need to pay anyone back.

Ok, this explains. Thank you!

 

[Musskiah]

How about we get an independent board and we don’t have to worry about it. Elon created this problem when he stacked the board with relatives and friends

The only board member of remote concern was Ira Ehrenpreis.

 

[Cobbler]

If only Ross Gerber was assigned a board seat at the time, this could've all been avoided

 

[heltok]

@elonmusk Going for a walk with Optimus

https://twitter.com/x/status/1752516361799258318

If I'm not mistaken, Optimus has flat, rigid "soles". The mobility and flexibility Seem too constrained. What if Optimus foot evolves into more human like, such as with functioning heal, ball, and toes.

The number of useful tasks that the bot cannot do due to limited foot mobility are near zero. Object manipulation with its hands, visual inspection and normal smartphone stuff will be 99% what it will do in the near future. It's a fun gimmick to make it walk more like a human, not a priority and not worth making the robot more complex and expensive for...

 

[Artful Dodger]

This is what's blowing my mind. That a guy with nine shares together with one single judge can overturn what a board of directors plus a majority shareholder vote said yes to. It doesn't feel legally nor morally just to me...

Short-sellers have been attacking Elon continuously since Summer 2018. They exposed their goals in Oct 2018 with the first go-round with the $EC: what they want, what they need, what they fantasize about is separating Elon from Tesla. And there is no PR campaign, no legal stunk, no dirty lie they are unwilling to tell to achieve that goal.

Too bad Elon's tougher than them, wot?

 

[Artful Dodger]

The number of useful task that the bot cannot do due to limited foot mobility is near zero. Object manipulation with its hands, visual inspection and normal smartphone stuff will be 99% what it will do in the near future. It's a fun gimmick to make it walk more like a human, not a priority and not worth making the robot more complex and expensive for...

It won't be that important in the factory standing on a finished cement floor, but it'll matter on Mars, especially since 'bots will be among the first arrivals. Ergo, Teslabot gets good feet...

Whadya think, 1M 'bots @ $50K each, delivery over 26 years (10 Mars-transfer conjunctions)? No interest, fixed price, owned by Musk's non-profit foundation? I think he'd spend $50B for that...

 

[bpjod]

The number of useful task that the bot cannot do due to limited foot mobility is near zero. Object manipulation with its hands, visual inspection and normal smartphone stuff will be 99% what it will do in the near future. It's a fun gimmick to make it walk more like a human, not a priority and not worth making the robot more complex and expensive for...

Until every factory position on this planet and possibly others has been filled by Teslabots, the flat feet will do fine. By the time I get old and need one as a porter on my backpacking trips, I'm sure they'll have a more versatile foot option available.

 

[Matias]

The only board member of remote concern was Ira Ehrenpreis.

"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"

 

[Oil4AsphaultOnly]

The judgment here is that those other shareholders were misled, and yeah they certainly werent the only parties objecting at the time whether public or not.

@ the milestones being impossible to achieve, the judgment states that three of the operational milestones were already in Tesla’s projections at the time of Grant award and they had a 70% probability some of the milestones would be achieved soon after award — you can find this at the bottom of Page 185 and onto Page 186.

The compensation package was voted and approved in Mar 2018. The 1st tranche wasn't awarded until May 2020 (which was primarily due to a bull market, since the stock had been suppressed for YEARS). The judge is using hindsight to rule that the objectives were "in Tesla's projections". 2 years of working for free is a VERY LONG time for a 70% probability.

Edit: And it's the plaintiff's "claim" that the other investors were mislead, but they weren't required to prove it! Since it's a civil case, the burden was for Tesla to prove that the investors weren't misled, which was more difficult to do. The judicial process was flawed, since the judge's assessment relied on hindsight. Any investor worth their salt does their own due diligence, and doesn't rely on the words of the board, so it's ridiculous to argue that the board's lack of independence were grounds for ruling the compensation package as being "unfair".

 

[Buckminster]

Tesla Optimus Sub-Prime Robot Walking

Elon Compensation Package

Key thing is how redomestication to Texas would work. Can they appeal this decision directly at the Texas Supreme Court following the move?

Although I am happy with Elon's Twitter purpose the costs add up for Elon:

1. Selling Tesla shares to fund
2. Subsequent TSLA drop
3. Twitter worth fraction of what he bought it for
4. Loss of 2018 compensation package
5. TSLA dropping 2.5% in response

I can't imagine the judge would have made this decision without previous Twitter case involvement or X ownership being a threat to free speech.

 

[WarpedOne]

Judges are not stupid ... think about that.

There is a reason for democracy.

 

[Musskiah]

"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"

I appreciate this all, yes. I understand Gracias and Maron had close, long lasting relationships to Elon. I would add one could argue Kimball and Larry Ellison as well.

I should clarify: What I mean is that Ira seemed particularly on the hotseat in the post-trial opinion.

 

[Todd Burch]

@elonmusk Going for a walk with Optimus

https://twitter.com/x/status/1752516361799258318

If I'm not mistaken, Optimus has flat, rigid "soles". The mobility and flexibility Seem too constrained. What if Optimus foot evolves into more human like, such as with functioning heal, ball, and toes.

I want a bot that can thread a needle with his toes.

Edit: to be clear I’m joking.