(Bloomberg) — Elon Musk's brain implant company, Neuralink, has changed the location of its business from Delaware to Nevada, taking steps to sever ties with a state where Musk has suffered major legal setbacks — one over salary and another over his business. Twitter takeover.
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The change was finalized Thursday, according to the Nevada Secretary of State's Office and a notice sent to the company's shareholders. Last week, a Delaware judge invalidated Musk's $55 billion Tesla pay package. In a post on his social media network X, Musk advised founders not to establish their companies in the state.
The notice sent to shareholders, reviewed by Bloomberg, informed them that their outstanding shares of the Delaware company would now be consolidated into the outstanding shares of the Nevada company.
Neuralink's lawyer, Philip Mao, declined to comment.
Last week, Musk tweeted that Neuralink had implanted a device in a human patient for the first time. The startup's technology aims to help people with traumatic injuries operate computers using only their thoughts. Ultimately, Musk said the Neuralink device will give people “control over your phone or your computer, and through them almost any device, just by thinking.”
Neuralink is not the first company Musk has reincorporated outside of Delaware and may not be the last.
Musk previously moved the X merger from Delaware to Nevada when he rebranded the company from Twitter. Nevada corporate laws provide more protection for executives against investor lawsuits.
Tesla, which is headquartered in Austin, was founded in Delaware in 2003. Last week, Musk pledged to try to shift Tesla's incorporation from Delaware to Texas, but such a move would require a shareholder vote.
Musk has a long history of legal disputes in Delaware, which is known as the incorporation capital of the country. The state is home to more than 70% of Fortune 500 companies, and its state court judges are recognized as business law experts who can hear cases on an expedited basis. Most of the state's high-profile merger and acquisition disputes are litigated in non-jury cases. Even foreign companies come to Delaware to resolve corporate disputes.
Two years ago, a Delaware judge dismissed an investor lawsuit challenging Musk's $2.6 billion acquisition of renewable energy company SolarCity, finding that the billionaire businessman did not improperly force his fellow directors to accept a pricey purchase of SolarCity.
Later in 2022, Musk was unlucky when he tried to back out of his attempt to buy the social media platform formerly known as Twitter. He has repeatedly suffered setbacks in pretrial rulings by Judge Kathleen St. Jude McCormick — the same judge who would go on to overturn his 2018 pay plan.
Read more: Musk criticizes Delaware, hints at Tesla moving in Texas after payment was refused
-With assistance from Dana Hall and Jeff Feeley.
(Updates with context starting in first paragraph.)
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