Musk: "77 Trillion Compensation Package Vote, Overwhelming Support"

Advance Voting Held Ahead of Shareholders Meeting on the 13th (Local Time)
Pro-Tesla Investors Including Cathie Wood Cast Supportive Votes

On the eve of Tesla's shareholders meeting, a vote on the '77 trillion won compensation package payment' for Tesla CEO Elon Musk was held, with approval overwhelmingly surpassing opposition.

According to Bloomberg and others on the 12th (local time), Musk CEO stated on his social media platform X (formerly Twitter), "Both major shareholder proposals are passing by a wide margin," adding, "Thank you for your support."

[Image source=Elon Musk X capture]

Earlier, Tesla conducted a preliminary vote on agenda items including the reapproval of stock option compensation worth $56 billion for Musk CEO and the legal relocation of Tesla's headquarters to Texas. The company set the voting deadline as 10:59 PM (Central Standard Time) on the day before Tesla's annual shareholders meeting. The final results will be announced at the shareholders meeting on the 13th.

An insider familiar with the preliminary vote count conveyed the atmosphere, saying, "Combined large institutional investors and individual investors resulted in a 'yes' outcome." Notably, Ark Investment led by Cathie Wood, a long-time supporter of Musk CEO, and Baron Fund led by Ronald Baron were confirmed to have cast affirmative votes. Baron CEO reportedly appealed in a public letter supporting Musk CEO's compensation package, stating, "Without Musk, Tesla would not exist," and "This vote could determine whether Musk CEO remains with the company." Norway's sovereign wealth fund and the California Public Employees' Retirement System (CalPERS) were understood to have cast opposing votes as planned.

For Musk CEO, who sought to prove Tesla shareholders' support for his compensation package at this shareholders meeting to gain an advantageous position in court, this was a relief. Previously, Musk CEO had received approval from Tesla's board in 2018 for a stock option compensation plan worth $56 billion (approximately 77 trillion won), but it was stalled due to an invalidation lawsuit filed by a minority shareholder. The appeal trial is scheduled to begin in July.

Adam Badawi, a corporate governance law professor at the University of California, Berkeley campus, pointed out, "Even if Tesla shareholders approve the existing agenda, it is uncertain whether the Delaware court will allow that vote to be valid."

Alexander Potter, an analyst at Piper Sandler, commented on the preliminary vote results, saying, "The issue is not completely resolved yet, and the compensation package can still be considered illegal," but added, "However, since a Delaware judge previously invalidated the compensation package due to limited shareholder disclosure, it is unclear whether the newly approved compensation plan through this enhanced public vote can be challenged again."

Meanwhile, Tesla's stock price on the New York Stock Exchange closed at $177.29, up 3.88% from the previous session. This was interpreted positively as Ark Investment, led by Cathie Wood, set Tesla's 2029 target price at about 15 times the current level, at $2,600. Ark Investment predicted that robo-taxis to be launched within the next five years would account for 90% of Tesla's corporate value and revenue.

This content was produced with the assistance of AI translation services.