SpaceX Files to Relocate to Texas After Elon Musk’s Spat with Delaware over Pay Package

SpaceX Moves Business Incorporation to Texas

SpaceX, originally incorporated in Delaware, has filed to relocate its business incorporation to Texas, according to Bloomberg. This move comes after a Delaware judge voided CEO Elon Musk's $55 billion pay package from Tesla. Musk has already relocated his brain-chip company, Neuralink, from Delaware to Nevada.

Musk's Dispute with Delaware

Musk publicly expressed his dissatisfaction with Delaware and the judge's decision to void his pay package. In response, SpaceX filed the necessary paperwork to move its incorporation to Texas. The Texas Secretary of State and representatives from SpaceX have not yet commented on the matter.

Texas as the New Headquarters

Elon Musk took to his social media platform, X (formerly Twitter), to announce SpaceX's relocation to Texas. He urged other companies still incorporated in Delaware to consider moving to another state. This decision comes shortly after the judge's ruling on Musk's pay package, which jeopardized his status as the world's richest person. Tesla has the option to appeal the decision.

Musk's Criticism of Delaware

Musk voiced his criticism of Delaware's tax laws and advised against incorporating companies in the state. He tweeted, "Never incorporate your company in the state of Delaware." In an informal poll on X, Musk asked for public opinion on where he should move Tesla. The majority vote favored Texas, prompting Musk to announce an immediate shareholder vote for the relocation.

The Challenges of Relocating Tesla

While Musk has successfully moved Neuralink's incorporation from Delaware to Nevada, the process may be more complex for Tesla. As a public company, Tesla's incorporation cannot be easily transferred. However, SpaceX already has significant operations in Texas, including a planned $100 million office building near its launch site in Brownsville. Musk had previously announced his intention to move Tesla's headquarters to Austin from Silicon Valley.

Expert Opinion on the Move

Charles Elson, the founding director of the Weinberg Center for Corporate Governance at the University of Delaware, criticized Musk's decision to relocate based on a single judge's ruling. He argued that creating a new business court with similar expertise would require significant capital investment. According to Elson, the cost would likely outweigh the benefits.

It remains to be seen how the relocation will affect SpaceX's operations and future business endeavors.

Read the original article on Business Insider.

—————————————————————————————————————————————
By: insider@insider.com (Lauren Steussy)
Title: SpaceX Files to Relocate to Texas After Elon Musk’s Spat with Delaware over Pay Package
Sourced From: www.businessinsider.com/spacex-relocate-to-texas-after-delaware-ruling-against-elon-musk-2024-2
Published Date: Thu, 15 Feb 2024 01:21:49 +0000