Proxy advisory firm Glass Lewis has shared a few thoughts on the ongoing vote to ratify Elon Musk’s 2018 compensation plan, ahead of the company’s upcoming shareholders meeting.
In a note to clients shared on Saturday, Glass Lewis said it recommends voting against Musk’s $56 billion compensation plan, noting its “excessive size,” as Bloomberg reports. Along with the size of the payment plan, the firm said it was concerned about the deal having a dilutive effect on shareholders.
“Mr. Musk’s slate of extraordinarily time-consuming projects unrelated to the Company was well-documented before the 2018 grant, and only expanded with his high-profile purchase of the company now known as X,” wrote the firm.
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The suggestion comes as many shareholders are deciding how to vote on the proposal, after it was struck down by a Delaware judge in January despite being approved by investors in 2018. Following the move to void the compensation plan, Tesla has launched a new vote to ratify the previously approved package, leaving many shareholders divided on how to vote following multiple rounds of layoffs at the company.
The re-incorporation and Musk compensation proposals are numbered three and four, respectively. Tesla will hold its annual shareholders meeting on June 13, and the company’s board has recommended voting in favor of ratifying Musk’s pay package, along with moving to re-incorporate the automaker in Texas.
The company has been pushing hard to encourage shareholders to vote yes on the proposals, sharing ads on various platforms and even launching a website dedicated to explaining how investors can vote—along with suggesting they vote in favor of the two proposals.
Tesla’s largest individual shareholder has also been outspoken about his opposition to the proposals, recommending that other investors vote against the compensation plan. There has been substantial discussion over the last several weeks as to whether to vote in favor of or against the package,
In addition, Musk has threatened to develop AI and robotics development outside of Tesla if he doesn’t gain enough shares to have around 25 percent voting control within the company.
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