(Bloomberg) — Shopify Inc. investors have agreed to grant Chief Executive Officer Tobi Lutke special voting rights, securing his influence at the e-commerce software company he founded.
Shareholders voted in favor of a proposal to create a “founder share” for Lutke, ignoring the advice of two prominent advisory firms.
The change guarantees Lutke at least 40% of the voting rights at the company under certain conditions, including that he stays with the company.
Shopify had argued that the proposal would benefit shareholders by ensuring Lutke maintains an active role at the Ottawa-based firm.
He isn’t allowed to pass the founder share on to anyone.
To pass, the proposal required a majority of the votes cast by shareholders, excluding the shares he controls.
Shopify announced the proposal in April.
Several weeks later, shareholder advisory firms Glass Lewis & Co. and Institutional Shareholder Services Inc. urged investors to reject it. The California Public Employees’ Retirement System had indicated it would vote against the proposal.
Shareholders also voted in favor of a 10-for-1 stock split.
Shopify rose 2.6% to $370 as of 10:36 a.m.
in New York. The shares have dropped 73% this year.
Read more: Shopify Was on Top of the World, Then Its Stock Fell 73%
(Updates share move. An earlier version corrected a sentence in the last paragraph to indicate the share price is in New York trading.)
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