Delaware vs Nevada vs Wyoming

Asked by: Matthew  — 21 October, 2011

In the section comparing incorporation advantages between Delaware, Nevada, and Wyoming, it is stated that a Delaware Corporation Director may determine the value at which to sell shares of stock? Does that standard also apply in Nevada and Wyoming?

Answered by: admin  — 21 October, 2011


In general, as a basic principle of corporate governance, the directors (not the shareholders) control the decision to set the valuation and sell the company (subject to any preemptive rights the shareholders may have).

I imagine this is true in Nevada and Wyoming as well, but I’m not sure. One also needs to distinguish valuation of equity from valuation of options which a director can no longer set independently. These days, valuation of options is set by the relatively new IRS mandate for a ‘409a valuation process’.

I hope that answer helps.

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