Shifting Gears: Tesla Proposes Move to Texas and Ratifying Musk's Pay.

Boardroom Governance Newsletter #51 | April 18, 2024

It’s hard not to write about Elon Musk when focusing on corporate governance matters. In my newsletter #49 (Feb 2024) I wrote about Chancellor McCormick’s opinion in Tornetta v Musk, where she rescinded his $55.8 billion compensation (now valued at about $46 billion).¹ In my last newsletter #50, I wrote about OpenAI’s boardroom saga and Musk’s lawsuit against Sam Altman, Greg Brockman and OpenAI in San Francisco Superior Court.²

The trend continues, because yesterday Tesla filed a Schedule 14(a) Proxy Statement with the SEC for its 2024 annual meeting, including two important proposals that were recommended by a Special Committee of the board: 1) to approve moving Tesla’s state of incorporation from Delaware to Texas, and 2) to ratify Elon Musk’s compensation under the CEO pay package that stockholders previously approved at the 2018 special meeting. Tesla’s annual meeting will take place on June 13, 2024.³

In short, more corporate governance litigation on the horizon.⁴ The rationale is t…