Musk’s small army of investors applauded the approval of his billion-dollar pay package

Tesla The CEO is approved by shareholders by Elon Musk huge pay package, the electric vehicle maker said on Thursday, a major endorsement of his leadership and an enticement for him to focus on his biggest asset.

Shareholders also approved the proposal to move the company’s legal headquarters from Delaware to Texas, Tesla said at the annual shareholder meeting in Austin, Texas. They also approved other proposals including the re-election of two board members: Musk’s brother Kimbal Musk and James Murdoch, son of media mogul Rupert Murdoch.

Shareholders increased the level of investor control by passing proposals favoring shortening board terms to one year and lowering voting requirements for proposals to Mostly simple.

“We are not just opening a new chapter for Teslawe’re starting a new book,” Musk said on the meeting stage.

Musk revealed late Wednesday that the proposals received overwhelming support and thanked shareholders. A chart on his social media platform X shows the resolutions were set by wide margins.

Tesla Musk’s pay package was last valued at $44.9 billion in an April regulatory filing. It was once worth as much as $56 billion but has dropped in value along with Tesla’s stock. TeslaMusk’s stock price has fallen about 60% from its 2021 peak as electric vehicle sales have slowed and Musk’s attention has fluctuated between Tesla and other companies run by him. Shares closed up 2.9% on Thursday.

The approval also underscores the support Musk has received from Teslabase is retail investors, many of whom are fervent fans of the mercurial billionaire. The proposal was approved despite opposition from several large institutional investors and proxy companies.

The Tesla The CEO could still face a lengthy legal battle to convince the Delaware judge who invalidated the package in January, describing it as “incomprehensible.” He may also face new lawsuits over this bidding package, which will be the largest lawsuit in American corporate history.

Shareholder approval of the compensation is both an endorsement of Musk’s tenure and an acknowledgment that investors don’t want to risk the company’s future.

In January, Musk threatened to build AI and robot external products Tesla if he fails to gain enough control of the vote, this essentially requires the 2018 pay package to be approved.

He shifted the company’s focus to robotaxis, eliminating the cheaper mass market. tramin response to the concerns of some investors who fear that autonomous technology will be difficult to perfect.

“This vindicates Musk and allays some investor concerns surrounding his waning interest in Tesla“said Sandeep Rao, senior researcher at Leverage Shares, which owns the company Teslacoupon of.

‘Tesla was saved’

Musk’s army of small investor allies won the approval of the payment package. Retail investors, who hold unusually high stakes in the electric vehicle maker, are generally indifferent to voting. But in a rare show of support, many people have been campaigning on social media for weeks to restore the famous billionaire CEO’s salary.

“An attempt to destroy Tesla has been foiled by retail shareholders,” Omar Qazi said in a post on social media platform X following an update from Musk. “Tesla was saved,” said Qazi, who posts from the account @WholeMarsBlog and has more than 476,000 followers.

Institutional investors appear to be divided on the issue. While some supported Musk’s salary, others such as the California Public Employees Retirement System and proxy companies Glass Lewis and Institutional Shareholder Services urged shareholders to reject the pay package, arguing that compensation level is too high.

“When both the institutions and the proxy advisory firms lean one way, it’s very rare that the vote goes the other way,” John Lawrence, a partner at law firm Baker Botts, told Reuters. “In this case, it shows the company’s understanding of the power of social media.”

A source familiar with the preliminary vote count told Reuters that backing from retail investors along with support from some large institutions were key to turning the vote in Musk’s favor.

‘We support you’

Musk has a global fan base for turning Tesla from a startup into a multibillion-dollar giant and for innovation at his other companies, including the manufacturer SpaceX rocket. But standing up to the powerful investors who voted “no” on the pay package requires more than just a fan base.

Social media has been abuzz for weeks with many users, such as Alexandra Merz, who posts on the X platform as @TeslaBoomerMama, urging people to vote. These efforts have prompted some non-US banks and brokerages to allow Tesla investors to vote, which was not the case before.

“Don’t mess with Tesla’s retail shareholders,” Merz posted Thursday, thanking those who voted. “Your vote will help correct real injustice.”

Musk himself is also actively attracting their support with regular posts on social networks. He set up a separate website to educate investors about the proposals, including reincorporating the company in Texas and how to vote.

The company’s board of directors regularly sends letters to shareholders highlighting Musk’s importance to Tesla and hinting at the risk of losing his interest if the payment package is rejected. Musk even organized tours of the Tesla factory for some voting investors.

The plan was successful. Musk said in a post on X over the weekend that about 90% of retail investors voted in favor.

This approval is important as Musk faces an uphill legal battle to convince a Delaware judge, who said Tesla’s board was “grateful” to him, while Tesla also has the ability to bring launched new lawsuits over the latest vote. However, small investors assured their continued support.

“Shareholders have spoken again and hopefully now our votes can officially be counted,” user X Alicia said in a post. “@elonmusk, we always believed in you and will continue to do so. We have your back!”