May 16, 2024 – Tesla is actively lobbying its shareholders to approve two key proposals at the upcoming annual general meeting. The first proposal seeks approval for CEO Elon Musk’s 2018 compensation package worth $56 billion (currently valued at approximately 405.44 billion Chinese yuan), while the second proposal aims to relocate Tesla’s incorporation from Delaware to Texas.
Previously, Musk’s compensation plan was revoked due to procedural irregularities ruled by a Delaware judge, and Tesla is now seeking reapproval from shareholders. The relocation of the company’s incorporation to Texas also requires shareholder approval. Both proposals have been listed as the 3rd and 4th agenda items for Tesla’s 2024 annual general meeting.
Tesla’s recent efforts to facilitate voting on these proposals are detailed in a 14A form submitted to the Securities and Exchange Commission (SEC). According to the document, Tesla has published dedicated advertisements and posts on social media, urging shareholders to vote in favor of the 3rd and 4th proposals. The company’s messaging is straightforward, emphasizing that shareholders have the ultimate decision-making power.
On May 13th, Tesla’s Board Chair, Robyn Denholm, sent a letter to shareholders, stressing the importance of the two proposals for “the continuation of Tesla’s mission and extraordinary growth.”
“These proposals are extremely important for the future of the company and your current and future investments,” wrote Denholm. “Six years ago, you voted in favor of the 2018 CEO performance bonus plan, demonstrating the wisdom of your collective judgment. Now, you have the opportunity to uphold your vote and make your voice heard by voting in favor of these proposals.”
In addition to Denholm’s letter, Tesla has highlighted the significant achievements the company has made since Musk’s compensation plan was approved in 2018. According to the company, Tesla’s share price has generated a return of approximately 1100% for shareholders since March 2018. Furthermore, Tesla has turned a loss of 2.2billionintoaprofitof15 billion. Between 2018 and 2023, Tesla’s vehicle production also increased sevenfold.
The letter also includes a quick guide for Tesla shareholders on how to vote in favor of the 3rd and 4th proposals, covering online platforms, QR codes, and regular mail. Tesla has also provided a hotline for investors to contact regarding this matter.
