Musk wants Tesla investors to vote on moving corporate registration to Texas

Tesla CEO Elon Musk on Thursday weighed in on whether to move Tesla’s registration to Texas after a Delaware judge rejected Musk’s multibillion-dollar bonus package on Tuesday. He said shareholders will vote.

Delaware Court of Chancery Judge Catherine McCormick ruled Tuesday that Musk cannot maintain a record-breaking indemnity agreement worth up to $55.8 billion, saying the indemnity agreement was unfairly determined and that Musk This is because the company controlled the board of directors that approved the package. In 2018, a group of shareholders challenged the bonus plan shortly after it was announced.

The ruling will be a huge financial blow to Musk, with financial analysts predicting it could strip him of his title as the world’s richest person. Musk lost his title to French luxury goods magnate Bernard Arnault this week. According to Forbes.

After the ruling, Musk slammed Delaware’s business regulations in social media posts. republishing A Wall Street Journal editorial criticized the state and said it publicly regretted its choice to register Tesla with the state.

“Never incorporate a company in Delaware,” he said. Said Tuesday.

tech billionaire voted Late Tuesday, X of his supporters weighed in over whether Tesla should change its corporate registration to Texas, where it is headquartered. Approximately 87 percent of the votes were in favor.

“The people’s vote is clearly in favor of Texas!” Musk announced Thursday. “Tesla will immediately hold a shareholder vote to transfer its state of incorporation to Texas.”

The First State is also where Musk was unable to back out of his $43 billion agreement to buy Twitter (now X) in 2022. Musk tried to challenge the deal in court, but was forced to press ahead with the agreement.

The company’s headquarters moved from California to Austin, Texas in 2021, but the company’s engineering division moved back to California last year. Musk said the move to Texas was prompted by rising home prices and the difficulty of expansion in the Bay Area.

Texas Gov. Greg Abbott (R) encouraged the move on Tuesday.

“Elon, it’s over,” he said. said in X, answer the questionnaire. “Election officials declare landslide victory in Texas.”