The Boring Company (TBC) will switch its state of incorporation to Nevada by March 2023. The tunnel boring company is the second Elon Musk-led company to announce a switch in its state of incorporation this past week.
Like most Elon Musk-led companies, including Tesla, the Boring Company was previously incorporated in Delaware. Over the weekend, Neuralink switched its state of incorporation from Delaware to Nevada.
The Boring Company’s switch to a Nevada incorporation seems strategic. The tunneling company’s biggest project to date is in Las Vegas. TBC is building an extensive loop across Sin City called the Vegas Loop.
The Boring Company already has some Vegas Loop stops running, particularly those connected to its Las Vegas Convention Center (LVCC) Loop. The LVCC Loop has proven The Boring Company’s concept as it has already catered to thousands of people visiting the La Vegas Convention Center.
The exodus of Elon Musk-led companies from Delaware incorporations for other states comes after a court decision voiding Tesla’s 2018 CEO compensation plan. Judge Kathaleen McCormick of the Delaware Court of Chancery ruled that Musk’s 2018 pay package was unreasonable.
Most—if not all—TSLA investors heartily disagree with Judge McCormick’s decision. ARK Invest CEO Cathie Wood called the ruling “unAmerican.” Following the decision, Elon Musk turned to X and asked the public if Tesla should change its state of incorporation to Texas.
The suggestion received resounding support. Elon Musk seems to be following through with the public’s decision, not just with Tesla but with his other companies as well.
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