Tesla has efficiently reassured a Delaware choose that its tried incorporation transfer to Texas gained’t have an effect on Elon Musk’s CEO compensation case.
In a brand new letter, Chancellor Kathaleen McCormick, the choose who canceled Elon Musk’s $55 billion compensation bundle after she concluded Tesla’s board misled traders, stated that Tesla’s legal professionals reassured her that the corporate gained’t use its new shareholder vote on the compensation and incorporation transfer to Texas to avoid the case.
The legal professionals for the plaintiffs filed to speed up the case, which is about for a listening to on July 8 to deal with the ridiculously excessive $6 billion authorized charge they’re asking for.
They had been involved that Tesla deliberate to make use of the votes on the incorporation transfer to Texas and the compensation bundle to keep away from the choose’s resolution in Delaware, which is principally the narrative that many Tesla shareholder influencers are pushing.
However Tesla’s personal legal professionals known as that “rank hypothesis” and McCormick took them to their phrases:
If I’ve interpreted the defendants’ place incorrectly, then protection counsel – as officers of the court docket – are duty-bound to appropriate it. Within the meantime, the defendants’ statements give me nice consolation.
Shareholders have been voting for weeks, resulting in the annual Tesla shareholders assembly on June 13.
As we beforehand reported, the corporate’s board launched an internet site and even began shopping for adverts to push the vote in that path.
The shareholder battle is heating up. We not too long ago reported on a significant pension fund that has introduced that it’ll vote in opposition to it and inspired different shareholders to do the identical.
Earlier this week, we reported Glass Lewis going in opposition to the board’s advice.
Electrek’s Take
That is what I’ve been saying for the reason that starting. The truth that Tesla shouldn’t be addressing any of the governance considerations, and as a substitute pushing for a fast revote and transfer to Texas doesn’t remedy the scenario.
And now, the choose has painted Tesla in a nook.
Tesla has a authorized obligation to comply with via and respect the Delaware court docket’s jurisdiction – making these new votes so much much less significant.
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