Tesla CEO Elon Musk says preliminary voting results indicate strong shareholder support for his massive pay package and moving the company to Texas.
Musk shared line graphs showing cumulative “for” votes surpassing the necessary approval threshold.
This announcement came just before Tesla’s annual shareholders meeting on Thursday, June 13 where the final results will be revealed.
These preliminary results are not final.
Shareholders can alter their votes until the polls close at the meeting.
Musk expressed his gratitude in his post, stating, “Thanks for your support!!”
Sources said the outcome remained uncertain as Tesla awaited the votes of major investors Vanguard and BlackRock.
Musk’s compensation plan was originally approved in 2018 with 73 percent of shares in favor.
The package is currently valued at about $46 billion
However, a Delaware judge recently rescinded the package, criticizing the board’s process and Musk’s influence over it.
Tesla has submitted the pay package for a fresh vote to address the judge’s concerns.
The contested pay package allows Musk to acquire options on nearly 303 million shares, adjusted for subsequent stock splits, contingent on Tesla meeting specific market value, sales, and profit targets.
The package is currently valued at about $46 billion.
Although the targets seemed ambitious at the time of approval, Tesla achieved them last year, leading to the vesting of the awards.
Musk has not yet exercised these options and would need to hold any shares for five years before selling them.
Tesla’s board conducted a global campaign to garner support for the pay package, engaging with large investors to argue that Musk merits the compensation for meeting stringent financial goals.
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The final vote will hinge on the participation of Tesla’s individual investors and the decisions of institutional investors.
Some prominent investors and proxy advisory firms oppose the deal as excessive.
However, many shareholders support Musk and the board in re-approving the pay package.
Tesla requires a majority of voted shares to approve Musk’s compensation plan, while the decision to move the corporate home to Texas requires a majority of all outstanding shares.
The board has advocated for the move to Texas, citing the state’s significance as Tesla’s headquarters and the location of a key factory.
Musk has criticized Delaware’s court system following the pay package ruling and encouraged companies to incorporate elsewhere.
In a February post on X, he announced SpaceX’s incorporation move to Texas and urged other companies to follow suit.
