courtesy:Tesla
The company’s board president said Friday that Tesla will utilize Thursday’s strong backing for Elon Musk’s $56 billion compensation deal to persuade a Delaware court that nullified his 2018 accord
After institutional investors and proxy consulting companies opposed the proposal, roughly three-quarters of shareholders, excluding Musk and his brother, voted in favor of the highest corporate pay package on Thursday.
Delaware judge Kathaleen McCormick annulled 2018’s vote in January, but the support was similar. Since the approval does not resolve the complaint, Friday might be the start of the legal fight to accept Thursday’s vote.
Tesla board chair Robyn Denholm wrote to shareholders on Friday that the decisive vote supports the company’s commitment to the 2018 deal. “We intend to put it back in front of the court in Delaware to ensure that your voices as owners of our company are heard,” she said.
McCormick termed the deal an “unfathomable sum” in January, citing a biased board with tight links to CEO Musk.
A Reuters note stated that Vanguard, Tesla’s largest shareholder behind CEO Musk, voted in favor and helped pass the pay deal despite first condemning it in 2018.
The win may allow Musk to focus on Tesla, whose shares have fallen as electric vehicle sales slowed and Musk bought Twitter, later renamed X. Friday saw Tesla shares drop roughly 2%.
Tesla established numerous vote thresholds for Musk’s salary deal. It earned 72% of votes under the tightest criterion, which removed Musk and his brother Kimbal Musk’s shares, compared to 73% in 2018.
Tesla’s filing shows 77% support under a looser vote count.
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