This post was originally published on this site
https://i-invdn-com.investing.com/news/LYNXNPED920A7_M.jpg
The settlement effectively resolves a lawsuit filed in 2020 by a retirement fund that holds Tesla stock. The lawsuit challenged the stock options issued to Tesla directors, which had been initiated in June 2017.
The directors were accused of granting themselves unfair and excessively large compensation in the form of approximately 11M stock options between 2017 and 2020. These stock options were claimed to significantly surpass the customary standards for a corporate board in terms of compensation.
As part of the settlement agreement, the directors have agreed to return the value equivalent to 3.1M Tesla stock options.
The settlement does not impact a $56 billion compensation package granted to CEO Elon Musk. In Musk’s case, there is a separate lawsuit that was initiated last year and is currently undergoing trial. A ruling is expected soon.
The directors have also agreed to forego any compensation for the years 2021, 2022, and 2023. The board has also committed to revising the methodology for determining compensation in the future.
Shares of TSLA are up 2.78% in afternoon trading on Monday.
