Elon Musk: Always A Douche

[The Minsky Moment]

How does reincorporating work?

I'm not sure on the mechanics, that's what the transactional lawyers do. You could create a new company in Texas and merge Tesla into that company.  There could be other ways. 

[Jacob]

So in theory shareholder value is unaffected, assuming the markets are neutral on the whole process?

[crazy canuck]

Texas?  Back when I first started my legal career, I was involved in a series of cases in which corporate entities tried desperately to avoid having their matters determined in Texas courts for a number of the reasons JR has explained, but primarily it was to avoid a Texas jury deciding very complex issues of corporate liability.

Those cases are still the textbook cases taught in Canadian law schools regarding conflicts of laws.

Musk obviously is much smarter than everyone else, and he sees something the rest of us have just simply missed.

[crazy canuck]

So in theory shareholder value is unaffected, assuming the markets are neutral on the whole process?

It really depends how it's done. And given that musk is in the mix, I would not assume that there would be classes of shareholders who would not be impacted negatively, and who would have a very good claim in a Texas court with a jury, who would be quite willing to provide them with a rich judgment.

[The Minsky Moment]

So in theory shareholder value is unaffected, assuming the markets are neutral on the whole process?

It shouldn't.  I wouldn't ordinarily favor Texas incorporation over Delaware; Texas would be pretty far down on the list of places to incorporate.  That said the likely net impact on a company like Tesla should be marginal.  The broader concern is what this says about management stability and coherence at the company.

[Barrister]

So in theory shareholder value is unaffected, assuming the markets are neutral on the whole process?

I think it's not so much that it's guaranteed that shareholder value is unaffected - rather  that in order to do so you have to get shareholder consent (and quite possibly from all classes of shareholders).


I've commented before that if all parties agree you can do virtually anything, legally speaking.  Its only when disputes arise (which they do, frequently) that things get complicated.

[crazy canuck]

So in theory shareholder value is unaffected, assuming the markets are neutral on the whole process?

I think it's not so much that it's guaranteed that shareholder value is unaffected - rather  that in order to do so you have to get shareholder consent (and quite possibly from all classes of shareholders).


I've commented before that if all parties agree you can do virtually anything, legally speaking.  Its only when disputes arise (which they do, frequently) that things get complicated.

Shareholder consent does not mean 100% of shareholders agreed to the proposition.  That is why there is such a thing as shareholder oppression lawsuits.  Which, is sort of the core of his present problem.

[HVC]

We'll never get to mars if musk keeps focuses on these petty matters.

[Barrister]

So in theory shareholder value is unaffected, assuming the markets are neutral on the whole process?

I think it's not so much that it's guaranteed that shareholder value is unaffected - rather  that in order to do so you have to get shareholder consent (and quite possibly from all classes of shareholders).


I've commented before that if all parties agree you can do virtually anything, legally speaking.  Its only when disputes arise (which they do, frequently) that things get complicated.

Shareholder consent does not mean 100% of shareholders agreed to the proposition.  That is why there is such a thing as shareholder oppression lawsuits.  Which, is sort of the core of his present problem.

Of course.

Depending on any Shareholder agreement you may need more than 50%, or you may need to get the majority of all classes or shares, or you might need "the majority of the minority" (if for example the majority shareholder is offering to buy out the minority).  It all gets complicated and out of my depth to go over in detail.

[Barrister]

We'll never get to mars if musk keeps focuses on these petty matters.

COunter-argument - the more time he gets distracted by stuff like this, the less time he has to mess up SpaceX...

[HVC]

We'll never get to mars if musk keeps focuses on these petty matters.

COunter-argument - the more time he gets distracted by stuff like this, the less time he has to mess up SpaceX...

I was mostly being sarcastic, but good point.

[crazy canuck]

We'll never get to mars if musk keeps focuses on these petty matters.

COunter-argument - the more time he gets distracted by stuff like this, the less time he has to mess up SpaceX...

I think your sarcasm detector needs a little maintenance   

[crazy canuck]

We'll never get to mars if musk keeps focuses on these petty matters.

COunter-argument - the more time he gets distracted by stuff like this, the less time he has to mess up SpaceX...

I was mostly being sarcastic, but good point.

I should kept reading 

[FunkMonk]

If only we had 50 Musks, one for every state.

[HVC]

Musk ranked most over rated CEO by fellow CEOs.

 Beats out second place Bob Igor by 97 votes.