Speaker 0: the biggest paycheck in corporate history is officially back on the table. delaware supreme court just named or handed elon musk a massive victory that restores his billions in stock options and completely changes who holds the keys to tesla's future. so we had talked about this previously, but the delaware supreme court has now reversed the lower court's decision that we talked about previously that canceled elon musk's 2,018 compensation package. this reinstatement gives musk back $304,000,000 in stock or 304,000,000 stock options valued at tens of billions of dollars and crucially increases its voting control over the company. it's headline news because it signals that even if a corporate board is a bit messy with its process, delivering massive profits for shareholders ultimately trumps legal technicalities. what do you think about this, john? Speaker 1: i don't know what to think about this. i saw this the other day, and i so i don't know enough to know like, i know he met the, um, the milestones, apparently. um, but are the milestones in like, based on the board like, did he improperly influence the board is my question, uh, for this compensation package from the start. Speaker 0: okay. so yeah. and, i mean, you're maybe. but, you know, a court decided that the process wasn't followed properly, um, historic like, the lower court. and, um, although how, i guess, they worked out the compensation package, the shareholders had voted for it. and the question was, was there undue influence at the board level or what have you to change it, to give them more, to do whatever? ultimately, i guess, um, the board voted for it or the shareholders voted for it. um, and the supreme court decided that based on everything and, you know, the shareholders just voting for this $1,000,000,000,000 potential pay package and everybody supporting um, the supreme court said no. you know? yeah. here you go. think of it like a commission only sales job. in 2,018, tesla told musk, we won't pay you a salary, but if you grow the company to a massive specific milestones, you get a chunk of stock. he hit every single target, but a judge took the payout away last year saying the process was unfair. and that's what you're saying was was there undue influence at the, uh, board level to influence his compensation package? you know? was where they let him do whatever they wanted and was that, uh, in plain sight and all that stuff got a little messy, and that's where the lower court jumped on it. so, you know, it's now for everybody understand, it's important because it secures musk position at tesla. he had threatened to build ai and robotics products elsewhere if he didn't have enough voting control around 25%. this gets him much closer to that number and keeping him focused on tesla. and i guess, to me, that's where that, uh, trillion dollar pay package is gonna come from is building the tesla robots and hitting milestones where, you know, what how big does a company have to be if your bonus to your, uh, ceo is a trillion dollars. Speaker 1: yeah. and, um, i i can't remember if you touched on this, but it because of tesla's stock price, the package, which was originally valued around 56,000,000,000, is now worth roughly a 139,000,000,000. Speaker 0: yeah. um, and they expect an accelerated push for full self driving, um, and the optimus robot. and, you know, elon has said and lots of people have said that these autonomous robots are gonna be the biggest selling product on the planet ever. um, as musk now has control, um, he wanted to pursue, um, these high risk technologies. so tesla voids a $26,000,000,000 accounting charge they would have faced if they had to write up a new pay package today, um, keeping the company's financial stable. um, tesla is moving its legal home to texas. in texas, you effectively need 30,000,000,000 in stock to sue the company for bad decisions, meaning the average stakeholder lose the power to take tesla to court. Speaker 1: yeah. Speaker 0: um, but there's other rules and stuff. i mean, delaware has become unfavored, um, for a lot of corporations now that are starting to move their, uh, corporate out of there because they're challenging a lot. where they used to be the easiest place to register and around tax and stuff, they're really making it hard till people are starting to change that, and test is one of them. Speaker 1: and the and the where else are they going? do you know i'm putting on this stuff? Speaker 0: texas. yeah. i don't know exactly what, uh, area in texas, but most of them are going to texas now. Speaker 1: okay. Speaker 0: and i could see some moving to florida, but we'll have to see how that goes. Speaker 1: yeah. Speaker 0: um, this sets a precedent that corporate boards don't strictly need to be independent from the ceo. the lower court found that the board was too cozy as you suggested with musk, but the supreme court decided that the results of stock pricing going up mattered more than the messy process. Speaker 1: yeah. Speaker 0: so governance experts are worried that this creates, uh, king cao era where founders can demand anything as long as the stock price goes up. also, by moving to texas, texas is in this is Speaker 1: this is, like, i i i didn't i this is more legal stuff that i wasn't i like, i wasn't able to wrap my head around it too much, but, um, i'm curious to see how this is going to impact future cases of this scale. and like you said, this this talks to extreme pay packages with less effective oversight. right? because if courts are gonna be reluctant to intervene after the fact, then there's just gonna be these ridiculous like, did you see that one ai engineer that that got what was it? i uh, from meta. i think it was, like, 2,000,000,000 or a billion dollar package pay package from meta, uh, to work on ai, one of the highest ever. so, um, like, the yeah. Speaker 0: but that's just them being insane and realizing that, um, they all these companies are competing. they started with a $100,000,000 bonus checks just to sign on for some of these high end engineers. and the people who think there's not high paying jobs out there in ai, you know, literally a 100 we you're talking about a billion dollar package for someone to go work for one of these companies being pulled away from another company. so the money's out there, but it's insane. yeah. and, you know, what do you do when there's those are the pay packages and stuff? but if you if i think the key part of it was it wasn't a here's the deal, and i didn't deliver. Speaker 1: yeah. Speaker 0: um, it's not like the golden parachute where somebody says, well, you lost the company. you know, it's half the value when you took it over and, well, i mean, you still get your bonus. yeah. i think, at least, we're doing this point of view that you hit the milestones. the company's worth this amount of money. this was messy. there might be some rules around, hey. you go clean this up, um, late you know, in the future and other people, you know, don't be like this, but you hit all the milestones. there's someone who didn't hit all the milestones. i do not think it'll be as favorable. Speaker 1: yeah. Speaker 0: so keep an eye on the optimus robot and robotaxi announcements. musk has the incentive to double down on those immediately. um, so this is a win for the tesla bull. people who invest in tesla, not as a car company, but as an ai robotics company led specifically by, um, elon musk. so definitely keep an eye on that. and the courts have decided that in the world of big tech, performance is king. if you make the shareholders rich, the rules of the game become a lot more flexible. so does elon musk deserve a big paycheck, or does elon musk deserve the biggest paycheck in history for the work he did, or is this failure of corporate checks and balances? let us know what you think in the comments, and we'll keep up with the story and let you know as it if it develops further. mhmm.