Tesla has two big things on which it wants shareholders to vote. First, they’re asking to officially move the company to Texas. Second, they want another shot at getting approval for Elon Musk’s giant pay plan as CEO.
Back in January, a judge said Tesla didn’t explain Musk’s pay plan clearly enough to shareholders when they voted on it before. So, Tesla wants them to vote again.
A Delaware judge threw a wrench into Tesla’s plans to grant CEO Elon Musk a massive compensation package. The judge basically said Tesla and Musk didn’t follow the proper procedures when they presented the plan to shareholders for a vote.
In simpler terms, the judge found problems with how Tesla came up with the pay plan and how they didn’t clearly explain those issues to shareholders before the vote. Because of this, the judge decided the entire vote was invalid, and Tesla had to cancel Musk’s big pay package, which was worth around $55 billion in stock options.
Tesla wasn’t too happy about this decision, and they said they might appeal it. But Musk also had another idea. He publicly criticized the judge, suggesting the decision might have been biased against him. He then proposed a surprising solution: move Tesla’s headquarters to Texas and ask shareholders to vote on the pay plan again.
And that’s exactly what Tesla is doing right now. They’re gearing up for their annual shareholder meeting in June, and on the agenda are two big proposals: officially moving Tesla to Texas, and giving Musk’s giant pay plan another shot at approval.
Tesla is getting ready for its big shareholder meeting in June, and they’ve sent out information about what will be discussed. Two major things are on the agenda:
- Moving to Texas: Tesla wants to officially become a Texas company.
- Musk’s Pay Plan: They want shareholders to vote again on giving Elon Musk a massive pay package in the form of stock options.
Tesla’s Chairwoman, Robin Denholm, is pretty fired up about the situation. A judge in Delaware recently decided that the original vote to approve Musk’s pay plan wasn’t fair to shareholders, even though almost 73% of them voted for it back in 2018. This means Musk hasn’t gotten paid anything for his work at Tesla in the past six years, even though the company has grown a lot during that time.
Denholm (who was actually on the committee that approved the pay plan in the first place) thinks this is totally unfair and goes against what the shareholders originally decided. She, and apparently many other shareholders, believe Musk deserves his big pay package.