2021-10-07 Tesla Annual General Meeting

[mblakele]

Let's make this a place to discuss voting on the agenda items for the 2021 AGM.

From the annual report:

We are pleased to inform you that our 2021 Annual Meeting of Stockholders (the “2021 Annual Meeting”) will be held on Thursday, October 7, 2021, at 2:30 p.m. Pacific Time, at Tesla’s Fremont Factory located at 45500 Fremont Boulevard, Fremont, CA 94538. For your convenience, we will also webcast the 2021 Annual Meeting live via the Internet at www.tesla.com/2021shareholdermeeting.​

[...]​

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All stockholders as of close of business on August 9, 2021 are cordially invited to attend the 2021 Annual Meeting in person.​

Please read this proxy statement carefully to ensure that you have proper evidence of stock ownership as of August 9, 2021, as we will not be able to accommodate guests without such evidence at the 2021 Annual Meeting.​

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Due to evolving regulations regarding travel and gatherings, we will announce more specific details regarding check-in procedures for the 2021 Annual Meeting closer to the date of the 2021 Annual Meeting.​

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[...]​

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The proxy statement and annual report are available at www.envisionreports.com/TSLA.​

 

[mblakele]

I'll start... what do folks think about Proposal 3?

Proposal Three— Tesla proposal for adoption of amendments to certificate of incorporation and bylaws to eliminate applicable supermajority voting requirements​

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[...]​

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The Board makes no recommendation on the adoption of amendments to our certificate of incorporation and bylaws to eliminate​

applicable supermajority voting requirements (Proposal Three).

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Since the Board isn't providing a recommendation, I have to think for myself. Oh, the pain!

But wait — the annual report includes this section:

Rationale for the Proposal​

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The 2020 Supermajority Proposal was an advisory and non-binding proposal. Even though it was approved by a majority of the shares entitled to vote and present in person or represented by proxy at the 2020 annual meeting of stockholders, such votes represented only 33.4% of the outstanding shares on the record date for such meeting and would have fallen short of the threshold required to approve the Proposal. Moreover, the proponent of the 2020 Supermajority Proposal also presented substantially identical proposals in each of 2019, 2016 and 2014, each of which were not approved by stockholders.​

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Therefore, the Board does not believe that there has been any indication of support for this Proposal from the requisite threshold of our stockholders. The Board will respect the outcome of the vote, but it believes that it would better serve Tesla and our stockholders to focus on other business matters at this time and makes no recommendation with respect to the Proposal.​

So the Board seems to be saying, "Hey, we think this is a waste of time, but if you shareholders really want it — ok."

Is that right? Any strong arguments for or against? If not, I suppose I'm leaning against.

 

[willow_hiller]

Any strong arguments for or against?

I'm leaning against proposal three right now. Primarily because it seems like it could unnecessarily tie the board's hands when they want to raise important future votes that probably should have supermajority requirements.

...think about Brexit. Simple majority referendum, only 51.9% of the country voted to leave. Things might have gone better if it had required a supermajority to pass.

I'm also curious to pick people's brains on Murdoch. I'm not a big fan of his work at Sky and Fox, but he is influential in the media...

 

[Mardak]

Proposal Three— Tesla proposal for adoption of amendments to certificate of incorporation and bylaws to eliminate applicable supermajority voting requirements​

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Since the Board isn't providing a recommendation…

The previous time this Supermajority came up as a Tesla Proposal was in 2019 (Proposal Four):

Proposal Four — TESLA PROPOSAL FOR APPROVAL AND ADOPTION OF AMENDMENTS TO CERTIFICATE OF INCORPORATION AND BYLAWS TO ELIMINATE APPLICABLE SUPERMAJORITY VOTING REQUIREMENTS​

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Tesla’s mission is to accelerate the world’s transition to sustainable energy. This mission continues to require a long-term focus that we believe will ultimately maximize value to our stockholders, and we face the risk of distractions posed by special interests that seek only short-term returns. At the same time, the Board continuously evaluates our corporate governance structure, practices and policies, and also weighs feedback from our stockholders. As part of this evaluation, the Board considered recent feedback from our institutional investors as described below in “Corporate Governance—Investor Outreach,” and reviewed the stockholder proposals we have historically received for our annual meetings of stockholders, including Proposal Eight and a stockholder proposal to vote on an advisory basis to fully declassify the Board, which our stockholders did not approve at the 2017 annual meeting of stockholders. The Board also determined that Tesla has established enough momentum, particularly through a very successful fiscal 2018, to set its course for the foreseeable future, establish credibility for its mission, and more effectively defend itself from opportunistic corporate raiders. Accordingly, the Board is asking our stockholders to approve this Proposal and Proposal Five, having determined that it is the appropriate time to give our stockholders a greater voice by facilitating their ability to effect changes to certain corporate and Board matters, and allowing them to vote on the performance of our directors with greater frequency.​

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The Board recommends a vote FOR the Tesla proposal for the approval and adoption of amendments to our certificate of incorporation and bylaws to eliminate applicable supermajority voting requirements.​

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The reference to 2019 Proposal Five is the same as 2021 Proposal Two (reducing director terms to two years). Seems like it's important enough for Tesla to keep bringing back both of these proposals. Although indeed odd that in 2019, the board explicitly recommended FOR while this time NONE.

 

[Dayreg]

Question for those who have attended the shareholder meeting in the past:

What do individual shareholders need to bring to attend the AGM?

Since I prefer electronic delivery of my statements, is a laser printed copy of my August brokerage statement enough to prove beneficial ownership? Or do I need to request something from my broker? (I checked my broker but they don't know and TSLA investor relations hasn't responded to my request.)

Thanks in advance!

 

[jkirkwood001]

Anybody else getting this error?

https://www.tesla.com/en_CA/2021shareholdermeeting-new

 

[mblakele]

Anybody else getting this error?

https://www.tesla.com/en_CA/2021shareholdermeeting-new

The link I've seen is different:

2021 Shareholder Meeting | Tesla

The 2021 Annual Meeting will be presented from Gigafactory Austin on Thursday, October 7, 2021, at 4:30 p.m. Central Time in a virtual-only format.

www.tesla.com

 

[jkirkwood001]

The link I've seen is different:

2021 Shareholder Meeting | Tesla

The 2021 Annual Meeting will be presented from Gigafactory Austin on Thursday, October 7, 2021, at 4:30 p.m. Central Time in a virtual-only format.

www.tesla.com

Yes but that regular one redirects to https://www.tesla.com/en_CA/2021shareholdermeeting-NEW
Doesn't it do that for you too? And doesn't that link fail?

 

[MP3Mike]

Yes but that regular one redirects to https://www.tesla.com/en_CA/2021shareholdermeeting-NEW
Doesn't it do that for you too? And doesn't that link fail?

It doesn't to me, it may be an issue of the Canadian site isn't setup for the meeting yet. (Or won't be?)

 

[willow_hiller]

Kinda surprised nobody is talking about the fact that two of the shareholder proposals actually passed. Posted this on the main thread and nobody noticed!

Correct me if I'm wrong, but didn't two of the shareholder proposals provisionally pass?

Martin said:

"I declare the polls are now closed. Based on the proxies that we have previously received, I'd like to announce on a preliminary basis that our stockholders have approved the recommendations of the Tesla board on all agenda items except item 2 regarding the reduction of director terms to 2 years; item 5 for an advisory vote regarding the reduction of director terms to 1 year; and item 6 for an advisory vote regarding additional reporting on diversity and inclusion efforts. While over 99 percent of shares present entitled to vote on item 2 did so as recommended by the board, unfortunately less than 66.7 percent of our total outstanding shares which were required to approve this item submitted votes for this item."

The board was for item 2, and against item 5 and item 6. So I interpreted that as item 2 failing and items 5 and 6 passing.

Edit: WSJ confirming it: Tesla to Move Headquarters From California to Texas, Elon Musk Says

Early tallies suggested that shareholders had signed off on a nonbinding proposal to cut board members’ terms to one year, from three, and a call to publish additional information on Tesla’s diversity and inclusion efforts.

 

[MP3Mike]

I thought the super majority was necessary for either board member term change, and that it wasn't met. Leaving just the diversity and inclusion item.

 

[willow_hiller]

I thought the super majority was necessary for either board member term change, and that it wasn't met. Leaving just the diversity and inclusion item.

Yeah, item 2 required a supermajority which it failed to receive, which was why that item failed.

But 5 and 6 were both non-binding, so they've passed with a simple majority.

 

[willow_hiller]

Here's the 8K. As expected, item 2 failed, and (non-binding) items 5 and 6 passed:

Inline XBRL Viewer

So I imagine Tesla will just improve their existing diversity and inclusion reporting to encompass item 6, and we'll probably see a binding vote for 1 year director terms at next year's shareholder meeting.