Twitter Inc.'s New Name - X Corp.

Twitter Inc. has informed the court that it has a new company name in a new state, which is X Corp., which is incorporated in Nevada, rather than Twitter's previous domicile in Delaware.

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Despite the fact that Twitter is still the name of the social media platform on users' phones and computers, "Twitter Inc. has been merged into X Corp. and exists no longer," according to a legal filing last week to inform a Florida federal court of the change in a case in which Twitter is a party. X Corp. is a privately held company incorporated in Nevada, according to Twitter's lawyers.

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Twitter's headquarters are located in San Francisco, where the company's principal place of business is located, and the company filed its annual report. As shown in the filing, X Corp. has a parent company named X Holdings Corp. that owns URAL 0.00% of the company. The merger was also recorded in the company's Delaware filings. 

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Recently, the changes have drawn a lot of attention, due to the fact that the documents have been circulated online and several outlets, including Slate, have written about them. There has been speculation in the online community that the information in the filings is part of Elon Musk's grand vision of using his acquisition of Twitter to help develop a new app called "X, the everything app".

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An email inquiry from Trade Algo about the reason for the change was responded to by Twitter with an auto-reply poop emoji in response to an email inquiry from Trade Algol.

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In the midst of retweets from Mr. Musk about SpaceX, his rocket company, and Twitter's legacy blue check marks, the billionaire sent out a tweet on Tuesday expressing his frustration with the company. In fact, Mr. Musk has a long history with the letter dating back to the time his former online banking startup, X.com, was merged with another firm to become PayPal. Mr. Musk often refers to one of his children as X.

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The billionaire also owns and operates a number of businesses in Nevada, including Tesla Inc., an electric car maker of which he is also CEO, which has a facility near Reno. Mr. Musk also owns a tunneling company called The Boring Co., which has a project there.

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During an interview with the British Broadcasting Corporation on Tuesday evening, Mr. Musk outlined his vision for X, which he says is intended to become the all-in-one app, and reaffirmed that Twitter is an accelerant.

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It seems that there are still some questions about the company's structure that are left unanswered by some corporate-law specialists. There was a new entity registering in Nevada called Twitter Inc., with Mr. Musk as its president, according to a filing, and some observers have speculated that it does not exactly relate to X Corp as it is not clear how they relate to each other. Alternatively, it could be used to keep anyone from using the name if Mr. Musk wanted to use it for Twitter at some future point, according to one law professor.

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In the opinion of corporate-law specialists, relocating the company to Nevada from Delaware has broader implications for the company's business.

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In comparison to the laws of Delaware, Nevada's laws provide a company's management and officers with more discretion and protection, according to Zohar Goshen, a professor at Columbia Law School who specializes in transactional law. "Twitter is now a private company controlled by one person, so they have the flexibility to make that move," he explained. In the case of public companies, Mr. Goshen said that "switching to a place where shareholders have fewer protections is not going to be that easy.".

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There is no doubt that Delaware is a popular place for companies to locate. Approximately two-thirds of Fortune 500 companies are located in the state, according to the state's secretary of state. 

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Besides the Delaware Court of Chancery, the state is also home to the unique, centuries-old Delaware Court of Chancery, a nonjury trial court that claims to be the top court in the U.S. for cases relating to the internal affairs of Delaware corporations and other business entities in the state.

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"It is not unusual for companies to move out of Delaware to Nevada if there are a few often-cited reasons to do so," according to Lauren Pringle, editor-in-chief of the Chancery Daily, a legal industry publication. She added that Nevada has a set of limitations on personal liability for directors, officers, and shareholders of a corporation, as well as limited liability for breach of duty.

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As indicated by Ms. Pringle, incorporation in Delaware is still considered the gold standard due to several reasons, including the fact that the legislature in Delaware is highly business-focused and corporate-savvy, and keeps Delaware General Corporate Law up-to-date.

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Professor Ann Lipton, a law professor at Tulane University, said the company's decision to relocate to Nevada will allow it to face litigation there going forward, rather than in Delaware, where it is currently based. Although, she said, any lawsuits that are already in progress in Delaware are unlikely to move to Nevada at this point. 

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In the past few years, Nevada has tried to position itself as an alternative to Delaware for companies looking for a place to start up, said Benjamin Edwards, a law professor at the University of Nevada, Las Vegas. Although this is true, Delaware remains more popular, he said, due to several factors, including the reputation of its Court of Chancery and the fact that many business lawyers and investors are familiar with Delaware law. 

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In Mr. Edwards' view, the Delaware Chancery Court offers a docket that moves quickly with a sophisticated judiciary at its disposal. In addition, "Delaware has such a well-established body of case law that you are able to predict the outcome of disputes in Delaware much better than in any other state."

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Musk has a mixed record in Delaware's Court of Chancery compared to the Delaware Superior Court, where he has shown a willingness to take legal battles to trial rather than settling them out of court in the past.  The battle to abandon the $44 billion deal in which he planned to acquire Twitter lasted several months in the courtroom. In a statement on Tuesday, Mr. Rodriguez claimed that he agreed to the agreement last year because he believed that he would be forced to do so by the judge at some point.

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Also, Mr. Musk won a major victory last year when a different Delaware judge ruled that Tesla's chief executive did not commit any illegal acts in the takeover of SolarCity by the electric-vehicle maker. 

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“Moving to Nevada means you won't see me around here anymore,” Mr. Edwards said. Edwards said Musk could leave the jurisdiction if he disagreed with the Chancery Court's decisions. "Delaware's court system doesn't compel him to play ball."