87% In Favor Of Relocating Tesla Corporation
Tesla CEO Elon Musk makes a stern expression during a conversation with Prime Minister Rishi Sunak in London, England, on November 2 last year (local time). 87% in favor of relocating Tesla corporation…CEO Elon Musk: Shareholders will vote. After Elon Musk, CEO of the American electric car company Tesla, lost a case to minority shareholders in a Delaware state court, he threatened to sway public opinion by voting to reorganize the corporation.
Tesla Corporation is registered in Delaware, which allows for lower taxes than other states in the United States. Musk held a vote on whether to relocate his headquarters to Texas, and received overwhelming consent.
On the 31st (local time), Musk held a vote on X (formerly Twitter), a social media platform he runs, to decide whether Tesla should change its corporate headquarters to Texas. This vote ended on the 1st with 87.1% ‘Yes’ and 12.9% ‘No’ among 1,102,554 participants.
Musk told X on this day, “Texas received clear support in the public vote. “We will now hold a shareholder vote to move the corporation to Texas.”
Musk once moved his headquarters due to conflict with the state government. In 2021, due to a conflict with the state of California over regulatory and tax issues, it relocated to its current location in Austin, Texas. At the time, Tesla’s headquarters was in Palo Alto, California.
Tesla Corporation is registered in Delaware. Delaware does not tax profits earned in other states. The corporate tax collected from companies that attract such companies at a tax rate of 8.7% is one of Delaware’s main sources of revenue.
Previously, on the 30th, a Delaware court ruled in favor of the plaintiff in a lawsuit filed by Tesla shareholder Richard Tornetta against the board of directors and Musk, saying, “The compensation package promised to Musk by the board of directors is invalid.”
Tesla’s board of directors did not pay Musk a salary in 2018, but instead approved a compensation package of up to 110 million shares of stock options paid 12 times depending on whether performance goals were met.
Toneta filed a lawsuit in October 2022, saying, “The compensation package approved by the board of directors without disclosing important information to shareholders is invalid.” At the time, Toneta was a minority shareholder with 9 shares of Tesla stock.
Due to Torneta’s victory, Musk is at risk of not receiving a compensation package worth $56 billion (about 74.8 trillion won). Musk predicted an appeal.
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