Zinger Key Points
- Tesla's annual shareholder meeting comes at a time the stock is locked in a lackluster phase, failing to take off in a big way.
- Apart from routine affairs, Investors may be keen to know about pipeline, near-term strategy, and Musk's commitment to Tesla.
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Electric vehicle pioneer Tesla, Inc.'s TSLA annual shareholder meeting is scheduled to be held this week, and investors look ahead to the event as a catalyst that can give the sagging stock a lift.
The Schedule, Venue: The EV maker's 2023 annual shareholder meeting is scheduled to be held at the Austin, Texas Gigafactory on Tuesday at 4 p.m. EDT.
How To Watch The Event: The annual shareholder meeting is planned as a hybrid event. The company allows a limited number of shareholders to attend the event in person and it conducted a random draw to determine who gets to attend.
For the other shareholders, the company provides an option to attend virtually, while a live stream will be made available to the general public.
The live stream can be accessed by clicking this link.
The virtual meeting of shareholders will feature the same live stream accessible to the public, plus the option to submit votes and written comments on meeting agenda items.
What's On Agenda: A proxy statement filed by Tesla in early April shows that five proposals would be discussed at the meeting, four sponsored by the company and one by shareholders.
Among the company-sponsored proposals are the election of Class I directors listed in the proxy statement, approval of executive compensation, approval of the frequency of future votes on executive compensation and ratification of PricewaterhouseCoopers LLP as the external auditor.
The lone shareholder proposal to be discussed at the meeting is regarding reporting on key-person risk.
It's a no-brainer that Tesla is recommending against voting for the shareholder proposal.
The three candidates Tesla nominated for election as Class 1 directors for a three-year term are CEO Elon Musk, Chair Robyn Denholm and JB Straubel, a former Tesla executive, who now runs Redwood Materials, a battery recycling company he founded. While the other two were already on the board, Straubel would be a new addition to replace Hiromichi Mizuno, who is stepping down from the board.
The others who round board membership, if elected, would be venture capitalist Ira Ehrenpreis, Airbnb co-founder Joe Gebbia, media mogul Rupert Murdoch's son James Murdoch and Musk's brother Kimbal and healthcare industry veteran Kathleen Wilson-Thompson.
Musk's 2018 CEO performance award has been fully vested and so he stands to receive a new grant.
See Also: Best Electric Vehicle Stocks
The proxy statement also suggested a change in the norms for pledging shares by Tesla's directors and executive officers. To mitigate the risk of forced sales of pledged shares, the proposed new norm prescribes that for the CEO, the maximum aggregate loan cannot exceed the lesser of $3.5 billion or 25% of the total value of the pledged shares. For other directors, it is 15% of the total value of the pledged stock.
A recent filing by Tesla showed that shareholder activist John Chevedden has asked shareholders to vote against Ehrenpreis, who is the chairman of Tesla’s executive pay committee. He took exception to the company’s recommendation of a once-in-three-years frequency to ratify executive compensation.
What Else: Investors would also like to hear from Musk about the company's product pipeline, near-term strategy and any other thing that might impact the business and in turn the stock.
While conceding that annual meetings are "scripted boring affairs," Future Fund's Gary Black said many key issues such as the timing of the launch of Cybertruck launch and potentially the $25,000 compact car. Other questions, the fund manager mentioned include Model 3 Highland refresh, pricing strategy, FSD/autonomy, Megapack expansion, thoughts on Tesla warming up to advertising, share buybacks and Twitter CEO appointment.
Shareholders may also want clarity on Musk's commitment to Tesla, especially after the rumors of him stepping down from his EV venture.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
Tesla closed Friday's session at $167.98, down 2.38%, according to Benzinga Pro data.
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