Elon Musk, CEO of Tesla, has revealed plans for a shareholder vote to relocate the electric carmaker’s state of incorporation from Delaware to Texas following a Delaware judge shooting down his gigantic pay package.
CNBC reports that Tesla CEO Elon Musk has announced a proposal to move Tesla’s incorporation from Delaware to Texas. The proposed change comes after a Delaware judge nullified Musk’s $56 billion pay package from 2018, raising questions about the fairness and negotiation process of such compensation plans.
Tesla, currently incorporated in Delaware, has faced scrutiny over its governance and compensation practices. Delaware, known for its business-friendly laws and courts that specialize in corporate law, has been a preferred state for incorporation for many major U.S. companies, however, the recent court ruling against Tesla’s compensation package for Musk has prompted the billionaire to reconsider the company’s state of incorporation.