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...It has not been an ordinary year in the First State. About two-thirds of American companies are incorporated in Delaware, attracted to the small, mid-Atlantic state by its sophisticated legal system....
...The court did something it usually doesn’t. It became a little less predictable. And that’s what inspired his posts on X aimed at Delaware. But Musk didn’t stop there....
...“If your company is still incorporated in Delaware, I recommend moving to another state as soon as possible,” Musk wrote on X on Wednesday....
...“You don’t want to be targeted as the next Disney facing a judge selected by Greg Abbott,” said Ann Lipton, a law professor at Tulane University, referring to the entertainment company caught up in the culture...
...Delaware-incorporated companies are valued at $34tn in aggregate, so Tesla is 1.7 per cent of that total....
...On Wednesday, Travis Laster, a vice-chancellor on the Delaware Court of Chancery, took aim at the corporate bar....
...About two-thirds of the Fortune 500 are incorporated in the state....
...This group briefly considered an option to domicile Tesla outside the US, but then drew up a shortlist of 10 states, before whittling the options down to Texas and Delaware....
...Collins Seitz Jr, the chief justice of the Delaware Supreme Court, tried to play statesman, noting the state is “not trying to win popularity contests” and that “Delaware has always persevered”....
...Her detailed legal analysis — as well as an in-depth look at the financial plumbing of Musk’s unprecedented pay deal — is the backbone of the specialised Delaware Court of Chancery....
...It is not the end of the affair: Tesla can appeal, and could propose a new pay deal, this time more carefully. Expert as Musk is at disruption, Delaware’s incumbency will be hard to dislodge....
...At the same time it wrote: “Delaware law can be indeterminate because of its use of broad, flexible standards that are applied to individual cases in a highly fact-specific way.”...
...Tesla has asked its shareholders to approve moving its state of incorporation from Delaware to Texas, fulfilling Elon Musk’s promise in February after a Delaware court voided his $56bn pay package....
...But I’d be stunned if they didn’t ask for a fee, in whatever form, worth multiple billions of dollars.”...
...Nor did it file in Delaware, where most of its entities are incorporated....
...Varallo convinced a Delaware judge that Musk’s $56bn pay package at his electric-car company Tesla should be voided, landing a massive dent in the billionaire’s net worth (don’t worry, he’s still rich)....
...The committee “initially considered all US states as well as the possibility of incorporating outside of the US”, before drawing up a 10-state shortlist — California, Delaware, Florida, Maryland, Nevada,...
...The judge, Sam Glasscock of the Delaware Court of Chancery, said the evidence presented by Handler showed some indications that the banker’s arrangement at Centerview had changed after the University Club...
...A spokesperson for the Delaware Department of State said Tuesday that it has referred what appears to be a faked iShares filing to the state’s Department of Justice....
...For some reason, which we don’t know why, that appeared not to be the perspective of the seller at the time that they delivered the preclosing statement . . ....
...The ruling came from a small court that oversees most large US public companies, thanks to so many of them being incorporated in the state....
...Recently, courts in Delaware, where most US companies are incorporated, have started to draw a line in the sand over bylaw changes, despite their record of deferring to companies’ discretion....
...Hours after the ruling, which Tesla can still appeal against, Musk wrote on X: “Never incorporate your company in the state of Delaware.”...
...They contend that the draft law would raise the cost of finance for poor countries, and they’ve threatened to move the sovereign debt market to Texas, Delaware, or some other jurisdiction that won’t try...
...Musk says he’s putting the idea up for a shareholder vote quote immediately. I’m joined now by the FT’s Sujeet Indap who wrote about Tesla, Musk and the great state of Delaware. Hi, Sujeet....
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