Tesla Inc. TSLA CEO Elon Musk shared a cryptic one-word post after a Delaware judge rescinded his $55.8 billion pay package.
What Happened: Musk’s response, a succinct “Interesting,” came just a day after Chief Judge Kathaleen McCormick of the Chancery Court voided the historically largest compensation plan, criticizing it as an “unfathomable sum.”
Musk has expressed discontent with Delaware, advising others to not incorporate their companies in the state. He has instead recommended Nevada or Texas, arguing that these states would better serve the interests of shareholders.
Despite Tesla’s headquarters being located in Texas, its state of incorporation remains Delaware, for now.
Déjà Vu: To recall, McCormick had also presided over a lawsuit that Twitter had brought against Musk over his acquisition bid.
While Musk proposed to acquire the social media platform in April 2022 in a deal valued at $44 billion, he developed cold feet and alleged Twitter misrepresented the size of its user base.
He was then sued by Twitter, which sought to enforce the original agreement. Musk eventually relented and closed the transaction in October 2022.
As a result, Musk suggested to his X followers that Tesla’s state of incorporation could change from Delaware to Texas.
Why It Matters: The common thread between Musk's Twitter acquisition and his Tesla compensation being rescinded is Judge McCormick.
Following the judge’s ruling, Musk’s future wealth could be significantly impacted.
TSLA Price Action: Tesla shares were down 1.1% to $185.12 at the time of publication Thursday, compared to a 52-week range of $152.37 to $299.29.
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