Since Tesla requested shareholders to endorse Musk’s 2018 pay package despite a Delaware court rejecting the plan earlier this year, the EV giant has been trying to drum up votes of its retail investor base. Musk’s compensation deal is presently valued at around $46 billion.The vote is taking place after a Delaware judge ruled against the 2018 package, stating that the package was excessive and unfair to Tesla investors. The judge was critical of Musk’s “extensive ties” with Tesla board members.

According to the Wall Street Journal, Tesla board Chair (Robyn Denholm) and other Tesla executives plan to devote the coming weeks traveling across the world to get backing from shareholders. In 2018, the Tesla board won approval for Elon’s 2018 pay package with 73% of the vote.Tesla shareholders are also presently voting on whether to move Tesla from Delaware to Texas. The EV maker has been incorporated in Delaware since 2003.

The Votes Needed

A simple majority of votesare required for the affirmative vote on Musk’s compensation. Votes owned by Musk and his brother (Kimbal Musk) need to be excluded. But, the vote to reincorporate Tesla in Texas requires a majority of all shares outstanding, with any uncast votes counted as “no.”Voting has been open for the past some weeks. The Tesla board is recommending “yes” votes on both reincorporating in Texas and Elon’s pay.

All Tesla stockholders have the right to vote in Tesla’s annual meeting with a deadline of 11:59 p.m. (Eastern Standard Time) on June 12. Registered stockholders can also vote at the virtual annual meeting.Retail, or individual investors, presently own about 30% of Tesla shares. Last week, billionaire Leo Koguanposted to X that he had voted against Musk’s compensation plan. Koguan, who reportedly holds more than 27 million TSLA shares, also voted against incorporating Tesla in Texas. Koguan is among the largest Tesla retail investors. Forbes estimates that his net worth is $5.9 billion.

Institutional investors hold a far-larger share of Tesla stock than they did in 2018. Vanguard voted against Musk’s pay package in 2018, while BlackRock and several others supported it.In 2018, proxy advisory firm ISS (Institutional Shareholder Services) recommended voting no on the Tesla package, stating the compensation was excessive. It has not weighed in on the current votes.”It’s like Mount Everest. It’s a huge hill to climb because getting 50% of the shareholders to vote, let alone what they vote for, is quite tough,” Tesla chair Denholm stated late last week.