Elon Musk’s $56 billion pay package received overwhelming support, with 77% of Tesla (TSLA.O) investors voting in favor at the annual meeting, according to a company filing on Friday. Despite opposition from some institutional investors and proxy advisory firms, the filing highlighted Musk’s strong backing from retail investors, many of whom are fans of the enigmatic billionaire.
Shares rose 1% before the bell on Friday, after rallying nearly 3% in the previous session following a Musk post stating the pay package was being approved by “wide margins.”
Investors holding 1.76 billion shares voted in favor of the pay package, the largest in U.S. corporate history, while 528.9 million shares voted against and 20.6 million shares abstained, according to Friday’s filing.
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In 2018, 73% of Tesla investors had voted in favor of the same pay package, which was voided by a Delaware judge this year.
The approval does not, however, resolve a lawsuit on the pay package in a Delaware court, which some legal experts said could stretch out for months. The judge invalidated the pay in January, describing it as “unfathomable”.
“Absolutely not (the end of legal matters). I think voting on the package after it was overruled by the court is a fairly unprecedented move. I don’t think this automatically invalidates what the judge did the first time around January,” Mathieu Shapiro, Managing Partner at law firm Obermayer said.
The proposal to reincorporate Tesla in Texas from Delaware received about 84% of votes, excluding those of board members Elon and Kimbal Musk, a step some analysts said might encourage other companies also to shift.
Investors also passed proposals with about 53% voting, including abstained votes, in favor of shortening board terms to one year and lowering voting requirements for proposals to a simple majority, despite board opposition to both.
