Tesla Inc. has proposed a 3-for-1 stock split in its proxy statement filed late Friday, saying it would provide more flexibility for its employees managing their equity and serve as a recruiting tool.
Tesla’s compensation, true to the company’s “startup origins,” it said, consist mostly of wages and equity awards.
“Whereas salary or wages are intended to meet our employees’ near-term liquidity needs, we believe that equity awards are an effective tool for retaining employees long-term,” the company said in the proxy.
Such “ownership culture” aligns the interests of employees with the long-term interests of stockholders, Tesla said.
The split would hinge on the approval of an increased share count. Tesla set its annual shareholder meeting for Aug. 4.