14 ms·

I don't understand why everybody thinks this fee is outrageous. These lawyers just saved Tesla's shareholders way, way more than that. Pay $6 billion to get $

by rhelz 3y ago

I don't understand why everybody thinks this fee is outrageous. These lawyers just saved Tesla's shareholders way, way more than that. Pay $6 billion to get $50 billion? I'll do that deal all day long and twice on Sundays.

seydor 3y ago
Musk would be paid in stock, so the "shareholders" did not win or lose anything (unless we assume the shareholders are at war with each other). If he turns sour ... i cant imagine the shareholders feeling like they won much. In other news, cheap EVs are entering the market so maybe it's a good opportunity for Elon to escape Tesla before it becomes a legacy brand name that some chinese maker will buy in a few years (like chevrolet or sth).
- pylua 3y ago
  > did not win or lose anything Is this true? Would there not be dilution?
  - Kluggy 3y ago
    There absolutely will be
    - seydor 3y ago
      How would there be dilution? He got stock options
    - mgiannopoulos 3y ago
      Since the stock went up 10x during the timeframe of the deal, the shareholders benefited a lot.
      - Kluggy 3y ago
        Some shareholder benefited a lot. Some bought at the top and have only had negative returns. Some have a net zero cause the bought at this point on the way up. Just because some people have astronomical returns doesn't mean everyone received the same.
        mgiannopoulos 3y ago
        We are talking about the shareholders who voted for the deal 6 years ago. The share is 10x since then. That’s why Musk was awarded the shares.
        Zigurd 3y ago
        Especially if they hold TSLA indirectly through ARKK.
  - seydor 3y ago
    he s a shareholder too, no? net should be zero
    - rhelz 3y ago
      An example with smaller numbers: Suppose a company is worth $10 and has 10 shares. The board issues 10 more shares to one person. Sure, the company would still be worth $10. But there are now 20 shares outstanding. Everybody except the guy who got 10 shares would see their shares fall in value from $1 to 50 cents. Basically, issuing stock to one person has the effect, mutatis mutants, of transferring wealth from all the other shareholders to the person who got the new stock.
      - seydor 3y ago
        Still the total value the shareholders hold is the same so they have have not been damaged as a group, which is alleged here. The damage is psychological, i.e. most of them are jealous of one of them
        hollerith 3y ago
        That makes no sense. Any money or shares Tesla pays to Elon is money or shares that could instead be used to pay dividends to the shareholders or to buy back shares, which increases the value of all the shares that have not been bought back.
        seydor 3y ago
        That's again assuming that elon is not a shareholder The dividends/buybacks are irrelevant. Anyone could sue to cut down dividends to increase buybacks or vice versa but thats besides the issue The whole conversation about dilution is irrelevant: elon was granted stock options, there would be no issuance of new stock
        deleted 3y ago
        [deleted]
theragra 3y ago
Not if Elon decides to leave Tesla. In this case, this was a catastrophic failure.
- pavlov 3y ago
  It might be better for Tesla shareholders than the past two years when he’s been essentially absent, but nobody else can step in to make decisions. The company is clearly behind in core product development and spent way too much time on Musk’s stale old follies like the Cybertruck.
- smcl 3y ago
  Oh damn yeah, then they might miss out on Cybertruck 2.0
- f38zf5vdt 3y ago
  Elon leaving Tesla would be the one thing _to_ make me invest. The company has fantastic growth potential being squandered by Musk on useless products like the Cybertruck.
  - AlchemistCamp 3y ago
    And how have your investment returns over the past 15 years stacked up against someone with all their savings invested in Tesla?
- isodev 3y ago
  Elon leaves Tesla: - Tesla finally settles with unions and starts treating their employees fairly. - Tesla addresses the water pollution of their Gigafactories in Europe. - Tesla signs that collective bargaining agreement in Sweden so they can finally sell cars there (and have their charging stations unblocked). - Tesla adapts their marketing to stop claiming auto-pilot bs. - Tesla adapts their quality control so Tesla cars are no longer delivered to customers in a semi-assembled state. - Tesla starts investing in research for more sustainable disposal of batteries and alternative means of energy storage I can see a lot of upsides to Musk leaving Tesla (on top of the $50B)
pylua 3y ago
The board, run by the shareholders, wanted that deal and put it in place. They must have thought that the value add was worth it. Granted, it seems many do not think they acted correctly, hence the ruling and the lawsuits. The point is that time will tell if this really saves money over the long run. I do not know the law and I am not questioning the board here.
- vkou 3y ago
  The board is responsible to the shareholders, but did not act in their best interests.
- rhelz 3y ago
  // The board, run by the shareholders // If the board was representative of the shareholders wishes, the shareholders wouldn't have sued the board.
  - mgiannopoulos 3y ago
    About 78% or so of the shareholders voted in favour of the deal. And will probably vote again when asked. The lawsuit was done by a shareholder with a total of 9 (nine) shares.
    - Eddy_Viscosity2 3y ago
      If those 78% of shareholders believe that Elon having $56B MORE is a priority in their lives, then should just voluntarily give Elon their shares or send him cash.
      - mgiannopoulos 3y ago
        Companies and shareholders meetings work a bit differently than what you suggest. Other than that, the grand majority of Tesla shareholders are quite happy with the financial state of the company and would like for Musk to continue leading the company and be compensated for it.
silveraxe93 3y ago
I don't get if this is sarcasm or not... Just in case it isn't: This is _exactly_ the argument for Musk's case. The lawyer was hired (and managed) to convince the court this argument is wrong.

by rhelz 3y ago

seydor 3y ago

Musk would be paid in stock, so the "shareholders" did not win or lose anything (unless we assume the shareholders are at war with each other). If he turns sour ... i cant imagine the shareholders feeling like they won much. In other news, cheap EVs are entering the market so maybe it's a good opportunity for Elon to escape Tesla before it becomes a legacy brand name that some chinese maker will buy in a few years (like chevrolet or sth).

pylua 3y ago
> did not win or lose anything Is this true? Would there not be dilution?
- Kluggy 3y ago
  There absolutely will be
  - seydor 3y ago
    How would there be dilution? He got stock options
  - mgiannopoulos 3y ago
    Since the stock went up 10x during the timeframe of the deal, the shareholders benefited a lot.
    - Kluggy 3y ago
      Some shareholder benefited a lot. Some bought at the top and have only had negative returns. Some have a net zero cause the bought at this point on the way up. Just because some people have astronomical returns doesn't mean everyone received the same.
      - mgiannopoulos 3y ago
        We are talking about the shareholders who voted for the deal 6 years ago. The share is 10x since then. That’s why Musk was awarded the shares.
      - Zigurd 3y ago
        Especially if they hold TSLA indirectly through ARKK.
- seydor 3y ago
  he s a shareholder too, no? net should be zero
  - rhelz 3y ago
    An example with smaller numbers: Suppose a company is worth $10 and has 10 shares. The board issues 10 more shares to one person. Sure, the company would still be worth $10. But there are now 20 shares outstanding. Everybody except the guy who got 10 shares would see their shares fall in value from $1 to 50 cents. Basically, issuing stock to one person has the effect, mutatis mutants, of transferring wealth from all the other shareholders to the person who got the new stock.
    - seydor 3y ago
      Still the total value the shareholders hold is the same so they have have not been damaged as a group, which is alleged here. The damage is psychological, i.e. most of them are jealous of one of them
      - hollerith 3y ago
        That makes no sense. Any money or shares Tesla pays to Elon is money or shares that could instead be used to pay dividends to the shareholders or to buy back shares, which increases the value of all the shares that have not been bought back.
        seydor 3y ago
        That's again assuming that elon is not a shareholder The dividends/buybacks are irrelevant. Anyone could sue to cut down dividends to increase buybacks or vice versa but thats besides the issue The whole conversation about dilution is irrelevant: elon was granted stock options, there would be no issuance of new stock
        deleted 3y ago
        [deleted]

theragra 3y ago

Not if Elon decides to leave Tesla. In this case, this was a catastrophic failure.

pavlov 3y ago
It might be better for Tesla shareholders than the past two years when he’s been essentially absent, but nobody else can step in to make decisions. The company is clearly behind in core product development and spent way too much time on Musk’s stale old follies like the Cybertruck.
smcl 3y ago
Oh damn yeah, then they might miss out on Cybertruck 2.0
f38zf5vdt 3y ago
Elon leaving Tesla would be the one thing _to_ make me invest. The company has fantastic growth potential being squandered by Musk on useless products like the Cybertruck.
- AlchemistCamp 3y ago
  And how have your investment returns over the past 15 years stacked up against someone with all their savings invested in Tesla?
isodev 3y ago
Elon leaves Tesla: - Tesla finally settles with unions and starts treating their employees fairly. - Tesla addresses the water pollution of their Gigafactories in Europe. - Tesla signs that collective bargaining agreement in Sweden so they can finally sell cars there (and have their charging stations unblocked). - Tesla adapts their marketing to stop claiming auto-pilot bs. - Tesla adapts their quality control so Tesla cars are no longer delivered to customers in a semi-assembled state. - Tesla starts investing in research for more sustainable disposal of batteries and alternative means of energy storage I can see a lot of upsides to Musk leaving Tesla (on top of the $50B)

pylua 3y ago

The board, run by the shareholders, wanted that deal and put it in place. They must have thought that the value add was worth it. Granted, it seems many do not think they acted correctly, hence the ruling and the lawsuits. The point is that time will tell if this really saves money over the long run. I do not know the law and I am not questioning the board here.

vkou 3y ago
The board is responsible to the shareholders, but did not act in their best interests.
rhelz 3y ago
// The board, run by the shareholders // If the board was representative of the shareholders wishes, the shareholders wouldn't have sued the board.
- mgiannopoulos 3y ago
  About 78% or so of the shareholders voted in favour of the deal. And will probably vote again when asked. The lawsuit was done by a shareholder with a total of 9 (nine) shares.
  - Eddy_Viscosity2 3y ago
    If those 78% of shareholders believe that Elon having $56B MORE is a priority in their lives, then should just voluntarily give Elon their shares or send him cash.
    - mgiannopoulos 3y ago
      Companies and shareholders meetings work a bit differently than what you suggest. Other than that, the grand majority of Tesla shareholders are quite happy with the financial state of the company and would like for Musk to continue leading the company and be compensated for it.

silveraxe93 3y ago

I don't get if this is sarcasm or not... Just in case it isn't: This is _exactly_ the argument for Musk's case. The lawyer was hired (and managed) to convince the court this argument is wrong.