“Tesla will move immediately to hold a shareholder vote to transfer the company’s registration to Texas,” Musk announced on the social network X (formerly Twitter), which he also owns.
A judge in the state of Delaware, in the eastern United States, annulled a $56 billion compensation plan for Musk on Tuesday, ruling in favor of a shareholder.
Many companies prefer to register in Delaware because of the simplified formal process that state offers. However, companies can have their headquarters in other states of the country, as is the case of the electric vehicle manufacturer Tesla, in Texas since 2021.
Shareholder Richard Tornetta filed a complaint in 2018 alleging that the businessman and the company’s board of directors did not respect their obligations when they authorized the compensation program.
According to the plaintiff, Musk dictated his terms to managers who, because of their relationship with him, were not independent enough to object.
The shareholder accused Musk of “unjustified enrichment” and requested the cancellation of the plan that was to extend for ten years.
Source: With information from AFP
