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Tesla Shareholders Can Vote To Oust Musk As Chairman Via New App

Elon Musk

A New York technology start-up that wants to make voting accessible to retail shareholders will debut for Tesla’s shareholders’ meeting on June 5 at which Tesla investors will be asked to vote whether Elon Musk can keep both roles as chairman and chief executive officer.

The app and website, Say, is co-founded by Jeffrey Cruttenden, who is also the co-founder of robo-investing app Acorns.

When Tesla holds its 2018 Annual Meeting of Stockholders on Tuesday, June 5, shareholders will be asked to vote on a proposal by one stockholder that the company’s chair be an independent director, not Elon Musk, who has been chairman since 2004 and is also the chief executive officer.

Jing Zhao has notified Tesla that he is the beneficial owner of twelve (12) shares of the company’s common stock and intends to present a Shareholder Proposal on Board Chairman Independence, Tesla said in a proxy statement to its shareholders at the end of April, recommending them to vote against this proposal. Zhao wants shareholders to vote on Tesla adopting a policy that the chairman be an independent director.

Now with the Say app, shareholders can sign up and connect the app to their brokerage account to verify that they hold Tesla shares and then click one of the two buttons—one in favor of keeping Musk as chairman, and one against.

The app is aimed at making sure that the vote of every regular shareholder counts, Cruttenden told CNBC on Monday.

Related: Shale Bottlenecks Could Send Oil Prices Higher

Still, it’s not certain how much Tesla shareholders will be motivated to ‘swipe left or right’ in the vote for an independent chairman, according to CNBC.

Retail investor voting rates remain relatively low in general, and voting tends to follow management recommendations. According to a March report by Broadridge Financial Solutions and PwC, institutional investors continue to vote at high rates, while retail investor voting rates remained relatively low, at 27 percent, while they owned 35 percent of the shares at 1,040 annual shareholder meetings held in the second half of 2017.

The large Tesla shareholders, apart from Elon Musk himself, are big fund managers that are likely to support Elon, according to analysts and investors who have spoken to Reuters.

By Tsvetana Paraskova for Oilprice.com

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