Tesla Shareholder Vote: T. Rowe Price Affirms Musk's 2018 Pay Plan Alignment With Investor Interests — But Remains Silent On Reinstatement (CORRECTED)

Editor’s Note: A previous version of this article incorrectly stated that T. Rowe Price supported the reinstatement of Elon Musk’s 2018 pay plan. T. Rowe Price has only affirmed that the 2018 plan aligned with investor interests and did not support its reinstatement. We regret the error.

Despite a Delaware judge voiding Elon Musk’s record-breaking 2018 pay package in January, citing unfairness to investors, Tesla, Inc. TSLA is preparing for a crucial vote regarding the plan’s reinstatementT. Rowe Price, the company’s tenth-largest shareholder, has clarified its stance.

What Happened: T. Rowe Price has acknowledged that Elon Musk’s 2018 pay plan aligned with the interests of long-term investors, but the investment firm has not aired its opinions about the reinstatement, according to Reuters. 

This position adds a significant layer of intrigue to the upcoming special vote at Tesla’s June 13 annual shareholder meeting, where the re-approval of Musk’s 2018 compensation plan will be decided.

T. Rowe Price’s statement contrasts with the court’s decision, which found the plan unfair due to the board’s negotiation process. 

“With respect to executive compensation, we believe the 2018 plan demonstrated strong alignment with the interests of long-term investors, and it was followed by an impressive, validating period of value creation,” the investment firm said in a statement, as per the report.

Why It Matters: T. Rowe Price’s perspective is noteworthy given its significant stake in Tesla. With 22.4 million shares held as of Dec. 31, their vote carries substantial weight. 

Their affirmation of the plan’s alignment with investor interests suggests confidence in Musk’s leadership and the long-term value-creation potential tied to performance-based pay packages.

While Tesla argues that the court’s decision left Musk uncompensated for the past six years, and the board chair echoed concerns about fairness, the focus now shifts to the broader investor base as they prepare to vote.

Check out more of Benzinga's Future Of Mobility coverage by following this link.

Read More: Tesla Recalls Over 3,800 Cybertrucks, Cites Unintended Acceleration Risk

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