By Dean Seal


The chair of Tesla is asking shareholders to vote in favor of ratifying Elon Musk's pay deal, currently valued at $46 billion, and moving the carmaker's corporate domicile to Texas.

Robyn Denholm said in a letter to Tesla shareholders ahead of next week's annual meeting that Musk's massive CEO payout is "about retaining Elon's attention and motivating him to focus on achieving astonishing growth for our company."

Proxy-advisory firm Glass Lewis advised shareholders last month to vote against the package that was originally approved in 2018 but struck down by a Delaware court in January over concerns about the approval process. Glass Lewis argues the payout dilutes everyone else's existing Tesla holdings while concentrating Musk's ownership.

Tesla fired back in a late-May report that Glass Lewis' recommendation "omits key considerations, uses faulty logic, and relies on speculation and hypotheticals." Denholm's letter followed on Wednesday, saying Musk had achieved the milestones needed to earn the compensation award, to the direct and substantial benefit of Tesla and investors.

"We now have the benefit of our bargain, with six years' worth of Elon's hard work," the chair said.

Denholm is also urging investors to vote in favor of moving Tesla's incorporation from Delaware to Texas, where it is currently headquartered. Glass Lewis has advised against that move as well.

Moving Tesla's legal home to the Lone Star State provides a better platform for innovation, as the state's legislators and courts are better positioned to make decisions about how corporate law applies to the company, Denholm said.


Write to Dean Seal at dean.seal@wsj.com


(END) Dow Jones Newswires

06-06-24 0727ET