Tesla’s CEO, Elon Musk, announced that the shareholders of the company have approved his 56 billion dollars compensation package by a majority before the voting concludes late Thursday.
“Both of Tesla’s shareholder resolutions are currently being adopted by an overwhelming majority!” the American entrepreneur wrote on the social media platform X.
He also noted that the shareholders of the electric vehicle manufacturer agreed to move the company’s headquarters from Delaware to Texas.
Specifically, the compensation package for Musk, which was initially approved at the 2018 shareholders’ meeting but subsequently delayed by the US justice system, is valued at 51.822 billion euros.
This package includes stock distributions over the next decade, contingent on the company meeting various specific targets.
This stock options package was agreed upon as a reward if Tesla achieved certain objectives, including a market capitalisation of 500 billion dollars (465 billion euros) and several revenue targets that have been met over recent years.
Tesla’s shares closed at around 20.70 dollars (19.16 euros) per share prior to the 2018 shareholders’ meeting.
On the past Wednesday, the shares closed at approximately 177.29 dollars (164.07 euros) and are pointing to a rise of over 6.7 per cent in the pre-market hours on the US Nasdaq.
Retail investors, who own around 40 per cent of Tesla’s capital, have emerged as Musk’s allies, supporting his proposals at the general shareholders’ meeting despite the opposition from several proxy advisory firms and institutional investors such as CalPERS and Norway’s sovereign wealth fund.
Notably, Vanguard, Capital Group, and State Street are among the top ten Tesla shareholders who voted against Musk’s compensation proposal in 2018.
However, the Scottish Mortgage Investment Trust of Baillie Gifford, one of Tesla’s oldest shareholders and one of the top fifteen owners of the company, has stated its intention to support Musk’s pay package.
Additionally, Ron Baron, CEO of Baron Capital, who holds a stake in Tesla valued at 2 billion dollars (1.863 billion euros), also supports the compensation package for Musk.
