The Jurisdiction Trade: How the Migration From Delaware Rewrote the Shareholder’s Right to Inspect, to Sue, and to Propose—and What Institutional Investors Must Demand Before the Next Reincorporation Vote

Every forensic conclusion Buxton Helmsley has ever published rests, somewhere in its chain of evidence, on a document that someone was legally obligated to produce. Compelled disclosure—whether mandated by the securities laws or extracted by a stockholder exercising a statutory inspection right—is the quiet foundation of the entire enterprise of investor advocacy. Financial statements can be reconstructed, footnotes can be parsed, and filings can be compared across periods—but the moment an analysis moves from what a company disclosed to what a company knew, the work depends on a statutory instrument that compels a board to open its records to the people who own the enterprise. In American corporate law that instrument has a name, a century of case law, and, until very recently, a steadily expanding scope.

That instrument is now being narrowed in every jurisdiction that matters, simultaneously, and the mechanism doing the narrowing is a shareholder vote.

Between January 2024 and March 2026, approximately forty-nine Delaware-incorporated public corporations put re-domestication proposals to their stockholders; in 2025 alone, boards submitted twenty-six such proposals, of which twenty-one were approved by vote and a further seven were approved by written consent.¹ Institutional Shareholder Services counted thirty-three Delaware corporations proposing to redomicile to Nevada or Texas for meetings held between January 2025 and May 2026, twenty-four to Nevada and nine to Texas.² The signal is clearest in the primary market: for the better part of a decade Delaware was the chosen domicile for roughly eighty to ninety-three percent of United States initial public offerings, and in 2025 that share fell to approximately sixty-two percent, with Nevada capturing roughly seventeen percent and Texas roughly four percent.¹ In December 2025, Coinbase Global completed its conversion to a Texas corporation with the approval of approximately seventy-eight percent of its voting power, observing publicly that Delaware “no longer has a monopoly on corporate law.”¹ In May 2026, ExxonMobil’s shareholders approved a move to Texas with approximately 71.2 percent support, over the objection of both major proxy advisers.³ ⁴ In June 2026, Dell Technologies followed with approximately ninety-seven percent of votes cast, and its conversion took effect on July 1, 2026; its Texas certificate of formation adopted the three percent derivative-standing threshold outright.³ ⁵ In July 2026, four Texas-headquartered entities—Energy Transfer, Sunoco LP, SunocoCorp, and USA Compression Partners—announced their departures from Delaware on the same day, moving roughly eighty-nine billion dollars of equity value between jurisdictions in a single coordinated announcement.⁶

Buxton Helmsley wants to be precise about what this analysis argues and what it does not. We do not argue that Delaware possesses any sacred claim to the American corporate charter, that jurisdictional competition among the states is illegitimate, or that Texas and Nevada have enacted anything other than carefully drafted statutes reflecting a considered legislative policy. We do not argue that any particular reincorporation has harmed any particular investor, and we are aware of no evidence that would support such a claim on the present record. We argue something narrower and, we believe, considerably more durable: that these transactions transfer a defined bundle of enforcement and information rights from shareholders to boards; that the transfer is executed through a proxy vote in which the bundle is rarely itemized and almost never quantified; that in the destination jurisdictions the decision to activate the most consequential provisions belongs to the board alone and requires no further shareholder approval; and that the counterweights investors have historically relied upon to evaluate such proposals are being dismantled in the same eighteen-month window in which the proposals are being called to a vote. Where a right is being surrendered by ballot, the ballot should say what the right is worth. Today, it does not.

I. The Instrument, and Why a Forensic Investor Cares About It

Section 220 of the Delaware General Corporation Law confers on stockholders a qualified right to inspect a corporation’s books and records for a proper purpose. For most of its history the provision was understood narrowly, reaching formal materials such as the stock ledger, board minutes, and the presentations placed before directors. Over the past two decades the Delaware courts expanded it considerably—both in scope, granting access to emails, text messages, and other informal communications, including those on personal accounts and devices, and in threshold, requiring a stockholder investigating suspected wrongdoing to show only a credible basis from which mismanagement might be inferred.⁷ ⁸

That expansion mattered enormously, and not principally because it produced litigation. It mattered because the Delaware courts had made inspection the practical predicate to any serious derivative claim. A stockholder cannot obtain discovery for the purpose of establishing demand futility; the courts have repeatedly held that the correct sequence is to use the inspection statute first and plead afterward, and have dismissed complaints for failure to exhaust that route.⁹ Inspection became, in the language the Delaware bench itself adopted, the primary tool at hand.⁹ ¹⁰ It is the mechanism by which the gap between what a board said and what a board knew becomes visible to anyone outside the boardroom.

For an investor whose method is forensic rather than merely fundamental, that gap is the entire object of the work. Restatements, impairments, going-concern qualifications, related-party arrangements, segment misallocations, and the whole catalogue of subjects on which this firm has published are, at the level of proof, questions about contemporaneous internal knowledge. Public filings establish what was represented. Only the internal record establishes when the representation stopped being supportable. Remove access to the internal record and forensic analysis does not disappear; it simply loses the ability to convert a well-founded inference into a demonstrated fact.

In March 2025, Delaware narrowed the instrument. Senate Bill 21, signed on March 25, statutorily defined the term “books and records” for the first time, limiting the default entitlement to an enumerated list of formal materials—the certificate and bylaws, minutes and materials of stockholder and board meetings, communications to stockholders, annual financial statements for the preceding three years, director and officer independence questionnaires, and similar categories.¹¹ ¹² Records beyond that list are obtainable only on a heightened showing. The statute imposed new form-and-manner requirements: a demand under oath, made in good faith and for a proper purpose, describing that purpose and the records sought with reasonable particularity, with the records required to be specifically related to the stated purpose.¹³ ¹⁴ It permitted corporations to impose reasonable restrictions on the use and distribution of anything produced, and to redact material not specifically related to the stated purpose.¹⁵ It provided that information obtained through inspection is deemed incorporated by reference into any complaint the stockholder later files on the basis of it—a provision with obvious consequences for pleading strategy.¹¹ And it applied retroactively to all demands made after February 17, 2025, the date the bill was introduced.⁸

In December 2025, in the first post-enactment decision construing the amended provision, the Court of Chancery set out the framework practitioners must now navigate, confirming the additional procedural and evidentiary hurdles a stockholder must clear to reach anything outside the enumerated categories.¹³ On February 27, 2026, in Rutledge v. Clearway Energy Group LLC, the Delaware Supreme Court, sitting en banc, unanimously rejected constitutional challenges to the companion amendments to Section 144, holding that the General Assembly had acted within its authority and that the framework applies retroactively.¹⁶ ¹⁷ Whatever else may be said about the Delaware amendments, they are now settled law.

II. What Actually Changes: Four Instruments, Read Individually

The public conversation about reincorporation is conducted almost entirely at the level of the state name. That framing is not merely imprecise; it obscures the only question that matters to an investor, because the destination jurisdictions do not present a single regime. They present a menu.¹⁸ A useful analysis therefore proceeds instrument by instrument.

The right to look. Two distinct provisions operate here, and the distinction matters. Section 21.218(b) of the Texas Business Organizations Code, as amended by Senate Bill 29, now provides that for purposes of a shareholder’s inspection demand the records of the corporation do not include emails, text messages or similar electronic communications, or information from social media accounts, unless the particular communication effectuates an action by the corporation.¹⁹ ²⁰ That exclusion is not limited to listed or opt-in companies; it applies to every Texas corporation, and parallel language was added for limited liability companies and limited partnerships.²⁰ ²¹ Separately, new Section 21.218(b-2), which applies only to a corporation with a class or series of voting shares listed on a national securities exchange or that has affirmatively elected to be governed by Section 21.419, provides that a demand is not for a proper purpose if the corporation reasonably determines it is made in connection with an active or pending derivative proceeding that is or is expected to be instituted by the holder or the holder’s affiliate, or an active or pending civil lawsuit in which the corporation and the holder, or their affiliates, are or are expected to be adversarial named parties.¹⁹ ²¹ Texas also conditions the demand right itself on holding shares for at least six months or holding at least five percent of outstanding shares, a threshold Delaware does not impose.²¹

Buxton Helmsley notes two limits on these provisions, because overstating them would be its own error. Section 21.218(b-3) preserves the shareholder’s ability to obtain records through ordinary discovery in the underlying lawsuit or derivative proceeding, and preserves the separate power of a court under Section 21.218(c) to compel production on proof of proper purpose regardless of holding period or size of position.²¹ And the electronic-communications exclusion is drafted “for purposes of this subsection,” which leaves open whether it constrains a court exercising the Section 21.218(c) power; we are aware of no decision resolving the question.²¹ What the amendments remove is the self-executing statutory route to the internal record, which is the route available to a shareholder who suspects a problem but has not yet filed. The forensic significance is difficult to overstate: internal electronic communications are, in nearly every documented governance failure of the past fifteen years, the most probative evidence of what directors and officers actually understood and when they understood it. The second provision is more direct still, in that it withdraws the proper-purpose predicate precisely from the shareholders with the strongest reason to seek records.

The right to sue. Amended Section 21.552(a)(3) provides that, for a corporation with common shares listed on a national securities exchange, and for a corporation that has affirmatively elected to be governed by the codified business judgment rule and has five hundred or more shareholders, a shareholder may not institute or maintain a derivative proceeding unless, at the time the proceeding is instituted, the shareholder beneficially owns shares sufficient to meet a threshold set in the corporation’s certificate of formation or bylaws, which may not exceed three percent of outstanding shares.²¹ ²² There is no dollar-denominated alternative. The threshold is purely proportional, which means its practical severity scales directly with the size of the enterprise. Tesla amended its bylaws to adopt the three percent threshold the day after Senate Bill 29 was signed, at a moment when three percent of the company was worth, by one contemporaneous estimate, approximately thirty billion dollars.²⁰ Southwest Airlines followed two days later.²⁰ ²³ Others—including HeartSciences, Dillard’s, CenterPoint Energy, and Legacy Housing—have since done the same, and TTEC Holdings proposed both a Texas reincorporation and the three percent threshold in its 2026 proxy materials.²⁰ At ExxonMobil’s scale, one commentator calculated in March 2026 that three percent represented approximately nineteen billion dollars.²⁰

The threshold has already been tested and upheld. In Gusinsky v. Reynolds, decided March 17, 2026, the United States District Court for the Northern District of Texas dismissed with prejudice a derivative action against Southwest’s directors arising from the elimination of the company’s longstanding free checked-baggage policy following an activist campaign.²³ ²⁴ ²⁵ The plaintiff held one hundred shares. Southwest’s own filings put that at less than 0.00002 percent of shares outstanding.²⁶ The plaintiff had served his pre-suit demand in April 2025, before the bylaw amendment existed; the court held that a demand letter does not institute a derivative proceeding, which commences only upon filing, and that the amended bylaw therefore governed.²⁴ ²⁵ The court rejected constitutional challenges premised on retroactivity and on the Texas open-courts provision, and it rejected the argument that the board’s adoption of the bylaw was itself an actionable breach, holding that such a claim is also derivative and therefore also barred.²⁷ The court described the statute as “a bold step toward making Texas the corporate law capital of America.”²⁷

The arithmetic warrants attention. A three percent threshold at a large-capitalization issuer does not raise the cost of derivative litigation. It confines standing to a handful of the largest asset managers in the world, and the empirical record is that those institutions do not sue. Researchers who collected a decade of data on mutual fund participation in every major form of shareholder litigation found that the ten largest mutual funds were involved in filing just ten traditional shareholder suits across the entire sample period, that those ten suits arose from only five distinct instances of managerial misconduct, that none of the funds ever served as lead plaintiff, and that the number of state-law derivative or class actions those funds pursued over the ten years was zero.²⁸ Over a comparable period the ten largest public pension funds brought thirty-one suits against twenty-two defendants, and a single Louisiana municipal fund was involved in ninety-three claims.²⁸ A gate that only a handful of institutions may lawfully open, and that those institutions have historically declined to open at all in state-law derivative litigation, does not screen meritless claims from meritorious ones at a large-capitalization issuer; it removes the category.

The right to propose. Senate Bill 1057, effective September 1, 2025, added Section 21.373 to the Texas code, permitting a nationally listed corporation with its principal office in Texas, or listed on a Texas-based exchange, to elect heightened thresholds for shareholder proposals.²² ²⁹ A proponent must hold the lesser of one million dollars in market value or three percent of voting shares, must hold continuously for at least six months before and throughout the meeting, and—critically—must solicit holders of at least sixty-seven percent of the voting power entitled to vote on the proposal.²⁹ ³⁰ Federal thresholds under Rule 14a-8 are two thousand dollars held three years, fifteen thousand dollars held two years, or twenty-five thousand dollars held one year.³⁰ On those figures, the Texas requirement is five hundred times the three-year federal threshold, sixty-seven times the two-year threshold, and forty times the one-year threshold. The legislature’s own bill analysis characterized the requirement in similar multiples, though it appears to have transposed the one-year and three-year figures.³⁰

At scale, the one-million-dollar figure binds rather than the three percent figure, and one million dollars is not, standing alone, an implausible institutional position. In fairness, the Texas holding period of six months is shorter than the one-year minimum Rule 14a-8 imposes at its lowest ownership tier.³¹ The genuinely prohibitive provision is the solicitation requirement, which has no federal analogue at all.³¹ Requiring a proponent to independently solicit two-thirds of the outstanding voting power before a proposal may reach the ballot converts a long-standing federal access right into a privately financed proxy campaign. It is worth noting what is being suppressed. Shareholder proposals are heavily concentrated at the largest issuers: one analysis of proposals submitted for Russell 3000 annual meetings found that S&P 500 companies received ninety percent of them, and a separate review found that over a three-year period only about ten percent of Russell 3000 companies, against roughly forty percent of S&P 500 companies, included any shareholder proposal in their proxy materials at all.³² For most corporations, the governance mechanism these thresholds are designed to suppress is close to nonexistent.

The right to a jury, and to a forum. Section 2.116 of the Texas code permits a corporation to include a jury-trial waiver in its governing documents for internal entity claims, including derivative actions, enforceable against any person who votes for or ratifies the change and against equity holders of a public company who continue to hold their shares.¹⁹ A shareholder who buys after a waiver is in place is deemed to have accepted it by the act of purchase.²⁰ Section 2.115 permits designation of Texas as the exclusive forum for internal entity claims.¹⁹ ²⁰ Nevada’s Assembly Bill 239, effective May 30, 2025, adopted a parallel jury-waiver authorization for internal actions, alongside provisions clarifying that stockholders owe no fiduciary duties except as controlling stockholders, defining a controlling stockholder by reference to the power to elect a majority of directors, and establishing a presumption that a controlling stockholder has not breached its limited fiduciary duty where the relevant transaction was approved or recommended by a committee of disinterested directors.³³ ³⁴ ³⁵ Nevada has also advanced a constitutional amendment to authorize a dedicated business court with exclusive original jurisdiction over shareholder-rights and fiduciary-duty disputes, a measure requiring passage in a second legislative session and approval by the voters.³⁴ ³⁶

Read together, these four instruments describe the complete architecture by which an outside shareholder converts suspicion into evidence, evidence into a claim, a claim into a proceeding, and a proceeding into a remedy. Each of them has been narrowed within the past eighteen months, and in no jurisdiction competing for these charters has any of them been broadened.

III. The Vote Is Not the Thing Being Voted On

Here is the provision that should govern institutional analysis of every reincorporation proposal now pending, and it is the one least likely to appear in a proxy summary.

Under the Texas framework, none of the rights-limiting provisions is self-executing, and none requires shareholder approval to activate. The opt-in authority belongs to the board.²⁰ A board may amend the bylaws to adopt the derivative-standing threshold, the proposal thresholds, and the associated restrictions unilaterally, with the only procedural requirement being notice in a proxy statement.²⁰ Tesla’s bylaw amendment came one day after enactment; Southwest’s came two days after.²⁰ ²³ In the Southwest matter, the amendment was adopted in the interval between a shareholder’s demand letter and the filing of his complaint, and it defeated the complaint.²⁴ ²⁵

The consequence is that a shareholder voting on a reincorporation proposal is not voting on a governance package. The shareholder is voting to grant the board an option to select a governance package later, at a time of the board’s choosing, without returning to the shareholders. ExxonMobil emphasized in its proxy materials that it declined to adopt three specific provisions: the derivative litigation ownership threshold, the shareholder proposal ownership threshold, and the jury trial waiver.⁴ Counsel to the transaction have noted that the company stopped short of committing not to adopt those provisions in the future, and that adoption could be accomplished by board-only bylaw amendment without a shareholder vote under Texas law.⁴ ²⁰ The proxy advisers’ opposition rested substantially on precisely this point—the possibility that the company might later opt into provisions permitting high ownership thresholds for proposals and derivative suits.³⁷

The instructive contrast is ArcBest, which moved to Texas in the same season and wrote express opt-outs into its Texas charter, describing the opt-outs as intended to preserve the rights its stockholders already held, and expressly opting out of the shareholder proposal threshold so that any future adoption would require a charter amendment rather than a board-only bylaw change.²⁰ ³¹ ³⁸ Fidelity National Financial had taken a comparable approach the previous year.³⁸ ArcBest demonstrates that the concern is answerable, that the answer costs a board nothing but the surrender of optionality, and that a board declining to give the answer has made a choice investors are entitled to read. Texas Capital Bancshares took a third course, pairing its move with a request for advisory approval to raise the shareholder proposal threshold to three percent of outstanding shares, and its reincorporation proposal failed.⁴ ³⁸

Dell Technologies illustrates the two-track structure most completely, and it deserves credit for saying so plainly. Article XVI of the Texas certificate of formation that stockholders approved provides that no shareholder or group may institute or maintain a derivative proceeding against a director or officer unless, at the time the proceeding is instituted, the shareholder or group beneficially owns at least three percent of the total outstanding shares.⁵ Separately, the proxy statement disclosed that, subject to approval of the redomestication, the board intended to amend the Texas bylaws to elect to be governed by Section 21.373, and it set out the resulting one million dollar, six month, and sixty-seven percent solicitation requirements.³⁹ The company reported the change under Item 3.03 of Form 8-K, the item captioned material modification to rights of security holders.⁵ Dell therefore did much of what this commentary argues every issuer should do: it placed the derivative threshold in the charter, where altering it requires a shareholder vote, and it disclosed in advance the bylaw election the board intended to make afterward. That the disclosure was made does not settle whether the terms are good ones. It does establish that this standard of disclosure is achievable at scale, which means its absence elsewhere is a choice rather than a constraint.

This is, in Buxton Helmsley’s judgment, the single largest disclosure gap in American corporate governance at this moment, and it concerns neither accounting nor valuation but the meaning of the shareholder’s own ballot.

IV. Who Is Actually Casting These Votes

The distributional pattern of reincorporation outcomes is more instructive than the aggregate count, and it is not ambiguous.

Of the thirty-three Delaware corporations that proposed redomiciling to Nevada or Texas for meetings held between January 2025 and May 2026, twelve were controlled companies—four of them affiliated with a single family—which guaranteed passage.² Proposals also passed at seven companies with a founder or insider group holding collective beneficial ownership between twenty-five and fifty percent.² Among corporations with widely dispersed ownership, the picture inverts: only six of fourteen proposals at non-controlled companies were approved during the same period, including one approved in connection with a merger vote, and the remaining eight failed or were withdrawn before the meeting.² In each of the eight that failed, at least one of the two major proxy advisers had recommended against.² A separate 2026 year-to-date analysis of five votes at sizeable widely-held companies found average support of approximately fifty-three percent of shares outstanding, with two of the five failing.⁴⁰ Texas Capital Bancshares, a non-controlled issuer, saw its proposal fail.³⁷ At ExxonMobil, where the proposal succeeded, it did so over the recommendations of both leading proxy advisory firms, and shareholders at the same meeting rejected a separate proposal, opposed by the board, that would have expanded the automatic voting options available under the company’s retail voting program.⁴¹

Dell’s result repays closer arithmetic, and the arithmetic is available to anyone who reads the company’s own current report. Dell reported that the redomestication carried with 3,358,114,482 votes for and 107,690,029 against, or approximately ninety-seven percent of votes cast. The same filing reports that Class A and Class B common stock each carry ten votes per share and Class C carries one, that 276,744,341 Class A shares, 47,789,758 Class B shares, and 325,034,188 Class C shares were outstanding on the record date, and that the Class A and Class B holders voting separately cast 2,767,249,771 and 477,897,577 votes in favor with none against and none abstaining.⁵ Class A and Class B together therefore represented roughly ninety-one percent of the company’s total voting power. Subtracting the separately reported Class A and Class B totals from the combined result leaves the publicly held, one-vote Class C shares: approximately 112,967,000 votes in favor against approximately 107,690,000 opposed. Among the Class C shares actually voted, in other words, the proposal carried with roughly fifty-one percent support. A measure that passed with ninety-seven percent of the voting power divided the public float almost exactly in half. Buxton Helmsley draws no adverse inference from this about Dell, which disclosed the governing terms with more specificity than most. We draw an inference about the ninety-seven percent figure, which has been widely reported and which describes the distribution of voting power rather than the distribution of shareholder opinion.

The Delaware Supreme Court has already addressed what happens when a controller and a dispersed minority disagree about a reincorporation. In Maffei v. Palkon, decided February 4, 2025, the court held unanimously that the business judgment rule, rather than entire fairness, governs a board’s decision to change the state of incorporation, reversing a Court of Chancery holding that the reduction in stockholders’ litigation rights constituted a material, non-ratable benefit to the controller and fiduciaries.⁴² ⁴³ The court reasoned that the asserted benefit was too speculative to trigger heightened review on a clear day—that is, absent pending or threatened litigation at the time of the decision.⁴³ ⁴⁴ It is a coherent holding, and its practical effect is worth stating plainly: in the underlying transaction, the board and a holder of more than fifty percent of the vote approved the conversion while the minority stockholders voted overwhelmingly against it, and the claims were dismissed.⁴⁵

Counts vary across sources, and investors should be careful with them; different studies use different denominators and different inclusion rules. One proxy adviser’s 2025 review, restricting itself to Delaware-to-Nevada and Delaware-to-Texas proposals, identified eighteen companies proposing to leave Delaware in 2025, with thirteen bound for Nevada and two for Texas, and noted that fifty-five percent of reincorporation proposals that season involved companies with significant or controlling shareholders.⁴⁶ Independent research comparing the periods before and after the 2024 Delaware compensation decision found that Delaware experienced a net loss of eleven large public companies through reincorporation from 2024 through the second quarter of 2025, against a net gain of four in 2022 and 2023, measured against a universe of 3,396 United States-headquartered companies above two hundred fifty million dollars in market capitalization listed on the New York Stock Exchange or Nasdaq.⁴⁷ The absolute numbers remain small, and investors should say so plainly. What warrants attention is the composition of the group that has moved, and the fact that the destination statutes were substantially rewritten after the migration began rather than before it.

Meanwhile, and this is the part of the picture most easily missed, the institutional apparatus investors have historically relied upon to evaluate these proposals is being dismantled on a parallel track.

On July 1, 2025, the United States Court of Appeals for the District of Columbia Circuit held in Institutional Shareholder Services Inc. v. SEC that proxy voting advice does not constitute a solicitation under the Exchange Act, sustaining the vacatur of the provision of the Commission’s 2020 rules that had incorporated the contrary interpretation.² ⁴⁸ On December 11, 2025, Executive Order 14366, styled Protecting American Investors From Foreign-Owned and Politically-Motivated Proxy Advisors, directed the Commission, the Department of Labor, and the Federal Trade Commission to review the industry, and directed the Commission to consider revising or rescinding rules relating to shareholder proposals, including Rule 14a-8.⁴⁸ The Federal Trade Commission opened two separate investigations examining whether the market position of the two principal firms harms competition.² Florida, Missouri, and Texas have brought or threatened enforcement actions; Texas Senate Bill 2337, which would compel disclosure when recommendations rest on non-financial factors, was preliminarily enjoined as to both major firms on August 29, 2025, and the litigation remained pending as of mid-2026.⁴⁹ ² Glass Lewis has announced it will retire its benchmark voting policy entirely in 2027, transitioning subscribers to customized or thematic policies.² Revised Commission guidance on Sections 13(d) and 13(g) has chilled engagement between large index managers and issuers.² In the 2026 proxy season, for the first time, BlackRock, Vanguard, and State Street each operated with two internal stewardship teams functioning independently on policy, voting, and engagement, with votable shares split between them.² JPMorgan and Wells Fargo announced they would cease relying on external proxy adviser recommendations in favor of proprietary systems.²

And in the same window, the Commission withdrew from its adjudicative role in the shareholder proposal process. On November 17, 2025, the Division of Corporation Finance announced it would not respond substantively to no-action requests for the 2025–2026 proxy season other than under the state-law exclusion.⁵⁰ The Chairman has since indicated he does not intend to direct the staff to resume the practice, and amendments to Rule 14a-8 have been forecast on the Commission’s regulatory agenda.⁵¹ ⁵²

The point is not that any one of these developments is illegitimate. Several rest on serious arguments about accountability and transparency in an industry that has long operated with limited oversight. The point is compositional. The right to propose is being narrowed at the state level at the same moment its federal adjudicator has stepped back and its principal institutional evaluators are being reorganized, constrained, or sued. Investors evaluating reincorporation proposals in 2026 and 2027 will do so with materially less institutional support than investors evaluating them in 2024 had.

One further mechanism deserves attention because it is likely to spread. On September 15, 2025, the Commission’s Division of Corporation Finance granted no-action relief under Rules 14a-4(d)(2) and 14a-4(d)(3) permitting ExxonMobil to operate a retail voting program under which retail holders may give a standing instruction to have their shares voted in line with board recommendations at all future meetings, either on all matters or on all matters other than contested director elections, mergers and acquisitions, and divestitures.⁵³ ⁵⁴ ² The company’s submission reported that retail investors hold approximately forty percent of its outstanding shares, that only about a quarter of those shares were voted at the last annual meeting, and that ninety percent of the retail holders who did vote over the preceding five years had supported all of the board’s recommendations.⁵³ Participants receive proxy materials and annual reminders and may override the standing instruction at any time, and registered investment advisers exercising voting authority for clients are excluded.⁵³ ² As of mid-2026, only one other public company had adopted a comparable program.²

Buxton Helmsley wants to characterize this accurately, because the obvious characterisation is the wrong one. The program does not change how retail holders vote; on the company’s own figures they already vote overwhelmingly with the board. What it changes is how much of that bloc votes at all, converting a constituency that delivered roughly ten percent of outstanding shares into one capable of delivering something closer to forty. The behavioral literature on defaults is not seriously contested, and the effect of a standing instruction is to make an existing alignment automatic and durable rather than to manufacture a new one. That is a smaller claim than the one usually made about these programs. It is also, for anyone modelling the outcome of a contested reincorporation vote, the more consequential one.

V. The Case for the Defense, Taken Seriously

The case for these reforms is substantial, and Buxton Helmsley has no interest in caricaturing it.

Begin with the premise that Delaware itself accepted. The stated purpose of the 2025 Delaware amendments was to reduce the costs and burdens associated with excessive stockholder litigation, particularly in controller transactions and inspection actions, both of which had proliferated.⁵⁵ That premise was not invented for the occasion. Books-and-records demands and follow-on litigation increased so sharply that the Court of Chancery began assigning inspection actions to magistrates to manage a growing docket.¹⁰ Demands routinely reached personal emails and text messages spanning years, under the lowest evidentiary burden in Delaware law.⁷ ⁸ ¹⁰ A corporation receiving such a demand faced substantial expense before any claim had been pleaded, let alone sustained. Reasonable people can conclude that a procedural entitlement calibrated for board minutes had drifted into something closer to pre-complaint discovery, and that recalibration was warranted.

The Texas framework is not a copy of anything. Practitioners directly involved in the drafting describe a considered legislative product, and the Texas Business Court, which convened in September 2024, provides a specialized commercial forum staffed by judges selected for substantive expertise.¹ Codifying the business judgment rule provides bright-line certainty in place of a discretionary, case-law-driven standard that had become genuinely difficult to predict.¹ Ownership thresholds address a real phenomenon: derivative suits filed by holders with negligible economic stakes, generating fee awards without corresponding recovery, a concern Senate Bill 29 also addressed by barring fee awards where the sole relief is additional or amended disclosure.¹⁹

The economics are real as well. Delaware’s franchise tax imposes a meaningful annual cost at the upper end, and several reincorporating companies cited it expressly in their proxy materials.¹ Delaware’s dependence on that revenue is structural: corporate franchise and related revenue accounts for approximately 29.2 percent of the State’s general fund sources under the Governor’s recommended budget for fiscal year 2027, second only to personal income tax.⁵⁶ ⁵⁷ A jurisdiction deriving nearly a third of its budget from a fee its competitors do not levy has an incentive that investors are entitled to weigh.

Jurisdictional competition is, moreover, a designed feature of American corporate law rather than a defect in it, and the empirical case for harm is thin. Only a small fraction of large public corporations have moved.⁴⁷ Delaware entity formations grew during 2025, from roughly 2.1 million to 2.2 million registered entities, and private companies—representing approximately two-thirds of Delaware’s franchise revenue—continue to select Delaware.¹ ⁵⁸ The Delaware Supreme Court’s reasoning in Maffei is defensible on its own terms: a speculative reduction in future litigation exposure, absent any pending or threatened claim, is a thin basis on which to impose the most demanding standard of review in corporate law.⁴³ ⁴⁴ Where non-controlled companies have proposed reincorporation, shareholders have in fact defeated roughly half of the proposals, which is evidence that the voting mechanism functions.² ⁴⁰ And ExxonMobil declined to adopt the contested provisions, while ArcBest wrote opt-outs into its charter and prevailed—evidence that the market can price this and that boards respond.⁴ ³¹ Dell, which did adopt the derivative threshold, disclosed it in the charter put to a vote, identified the further bylaw election its board intended to make, and reported the change under the Form 8-K item reserved for material modifications to the rights of security holders.⁵ ³⁹ Whatever one concludes about the substance, that is not concealment.

A fair reading concedes all of it. Five rejoinders survive.

First, every argument in the defense addresses the cost of litigation, and none addresses the cost of information. No party to this debate has argued that investors are better off knowing less about what their boards knew. Yet the narrowing of inspection rights is the change that most directly bears on that question, and it has been justified almost exclusively by reference to the burden of the proceedings that inspection sometimes precedes. A reform that removes internal electronic communications from the scope of inspection is not calibrating litigation costs; it is deciding, in advance and categorically, that a class of evidence will not be produced.

Second, the instruments narrowed are tail instruments. Inspection, derivative standing, and jury trial do not operate in the ordinary course of a well-governed company; they operate in the rare case where governance has failed and the failure is not visible from the outside. Averages are the wrong measure of their value. The modern architecture of shareholder remedies exists in its present form because the cost of the tail—measured across the corporate failures of the past twenty-five years and the investors who absorbed them—overwhelmed whatever efficiency the prior arrangements achieved in the mean.

Third, the favorable evidence predates adoption. Senate Bill 29 became effective in May 2025. As of March 2026, one commentator reported that no corporation had yet adopted the Senate Bill 1057 proposal thresholds, though by April 2026 companies had begun to do so in connection with Texas moves.²⁰ ⁵⁹ The derivative threshold has been adopted by a small number of issuers and tested in exactly one reported decision.²⁴ Buxton Helmsley is aware of no company operating under a three percent derivative threshold that has yet faced a documented accounting fraud, a contested going-private transaction, or a controller conflict of the kind these instruments exist to address. An empirical record assembled entirely from the period before a mechanism is used is not evidence that the mechanism is harmless.

Fourth, the direction of travel has been uniform. Delaware narrowed. Texas narrowed. Nevada narrowed. No jurisdiction competing for corporate charters in this cycle has offered a package that expands the investor’s entitlement. The classical answer to this observation is that the market prices the difference, and that a charter offering weaker protections trades at a discount that boards must bear. That answer depends on the difference being observable and on the party choosing being the party bearing the cost. Here the party choosing is the board, the party bearing the cost is the shareholder, and the difference is not itemized in the document on which the shareholder votes. Whatever one concludes about regulatory competition in the abstract, its self-correcting mechanism requires a functioning price signal, and the disclosure practice described in the next section does not produce one.

Fifth, and most importantly, no argument in the defense addresses the option. Every claimed benefit of the Texas framework—predictability, reduced litigation cost, a specialized forum, franchise-tax savings—is fully available to a corporation that reincorporates and writes opt-outs into its charter, as ArcBest did. A board that reincorporates while retaining the unilateral right to activate those provisions later has obtained something in addition to the stated benefits. Investors are entitled to ask what that something is worth, and to be told before they vote rather than after.

VI. What the Proxy Statement Does Not Say

Buxton Helmsley reviewed the shape of the disclosure practice that has developed around these proposals. It is uneven rather than uniformly deficient, and the unevenness is itself the finding. Dell’s 2026 proxy included dedicated sections comparing the Delaware and Texas charters, the Delaware and Texas bylaws, and stockholder rights under the two states’ laws, and it disclosed both the charter provision being adopted and the bylaw election the board intended to make afterward.⁵ ³⁹ Nothing in federal or state law required any of that. A disclosure standard that depends entirely on whether a particular board volunteers it is not a standard. Three omissions recur where boards do not volunteer.

The first is the absence of a rights delta. Reincorporation proxies describe the destination jurisdiction, frequently in favorable general terms, and often include a comparison of statutory provisions. What they do not reliably provide is an itemized statement of which specific enforcement and information rights a shareholder holds before the transaction and which the shareholder will hold after it, distinguishing provisions that apply automatically, provisions the company is electing now, and provisions the board may elect later without a further vote. The distinction between those three categories is the whole of the analysis, and it is precisely the distinction the disclosure tends to collapse.

The second is the absence of quantification. A three percent derivative threshold has a dollar value that can be computed to the share. A sixty-seven percent independent solicitation requirement has an estimable cost. No accounting or valuation convention requires that either figure appear, and in practice neither does. A shareholder asked to approve a transaction is entitled to the arithmetic.

The third is the absence of commitment. Where a board states that it is not adopting rights-limiting provisions, that statement is a description of present intention rather than a governance undertaking, and the distinction is rarely drawn for the reader.

There is early evidence that the market is beginning to notice. Plaintiffs’ counsel have begun scrutinizing re-domestication proxies that advance thin justifications and rest on generalized litigation concerns without identifying specific transactional or governance considerations.¹ The Council of Institutional Investors amended its reincorporation policy in March 2025 to provide that companies should not reincorporate in jurisdictions where governance structures are less robust than in the current jurisdiction, and should not adopt governing documents that “diminish investor rights and protections in connection with reincorporation.”²⁰ Vanguard disclosed in its 2025 annual report that it voted against redomiciliation proposals at three of four issuers in one controlled group because of what it assessed to be an “insufficiently compelling rationale relative to the associated diminishment of shareholder rights,” while supporting the fourth where the company presented a stronger case for alignment between its operational footprint and its state of incorporation.² That is the correct analytical posture, and it should be the default rather than the exception.

VII. What Institutional Investors Must Demand

Buxton Helmsley does not believe the appropriate response is to oppose reincorporation categorically. There are sound business reasons for a corporation to align its legal domicile with its operations, its workforce, and its regulatory relationships, and there are sound reasons to prefer a statutory regime with bright-line rules over one that depends on the retrospective application of equitable standards. We believe the appropriate response is to relocate the burden of proof onto the proposal, and to insist—through proxy votes, through engagement, and through the terms allocators set with their managers—on disclosure sufficient to evaluate what is being surrendered. The following are the demands we believe institutional investors should now make.

First, investors should demand the charter, not the state. A vote to reincorporate is a vote on a specific set of governing documents. Investors should require that the proposed certificate and bylaws be presented in the proxy in final form, with every rights-limiting provision the destination jurisdiction permits expressly identified as adopted, expressly declined by charter opt-out, or expressly reserved to future board action. A board unwilling to place its answer in the charter has given an answer.

Second, investors should demand a quantified rights-delta table. For each instrument—inspection scope, inspection refusal rights, derivative standing threshold, proposal eligibility and solicitation requirements, jury waiver, exclusive forum, controller safe harbors, and officer and director exculpation—the proxy should state the current entitlement, the entitlement after the transaction, and the dollar or percentage magnitude of any threshold, computed at a stated reference date. A shareholder asked to approve a three percent derivative threshold should be told what three percent costs.

Third, investors should demand a re-vote covenant on activation. Where a board declines to opt out permanently, the charter should provide that any subsequent adoption of a rights-limiting provision requires advance written notice to shareholders and ratification at the next annual meeting, and should not take effect as to claims arising before that ratification. The Gusinsky sequence—demand served, bylaw amended, complaint filed, complaint barred—is the case for this term, and it is not a hypothetical.²⁴ ²⁵

Fourth, investors should demand preservation of the electronic record by private ordering. Where the destination statute removes internal electronic communications from the scope of inspection, nothing prevents a board from committing by charter or bylaw to produce board-level and committee-level electronic communications on a defined standard, subject to appropriate confidentiality restrictions. A board that believes its record is sound loses nothing by making such a commitment, and a refusal to make it is itself informative. Investors should also seek an undertaking that the corporation will not exercise the statutory right to refuse inspection solely on the basis that the demanding shareholder is engaged in, or expected to commence, litigation.

Fifth, investors should vote the package and the directors, not the geography. Where a board proposes a move without opt-out protections and without the disclosure described above, the reincorporation proposal is not the only ballot item that matters. Governance committee membership is the accountable office for a decision of this character. Investors who oppose a proposal and then support the directors who advanced it have communicated nothing.

Sixth, allocators should write this into their manager guidelines. Asset owners should ask each manager whether it maintains a written policy on reincorporation proposals, how that policy treats the board-held activation option specifically, whether the manager’s stewardship function has been divided into independently operating teams, and which team will vote the asset owner’s shares.² Where a manager has adopted an internal or artificial-intelligence-assisted voting system in place of external research, allocators should ask what governance inputs that system uses and how it treats the distinction between adopted and reserved provisions.² These are now first-order questions about how a manager exercises the ownership rights attached to the asset owner’s capital.

Seventh, investors should build the record themselves, because no one else is now doing it. With the Commission’s staff having withdrawn from substantive adjudication of proposal exclusions, and with the principal proxy advisers reorganizing under legal and political pressure, the institutional infrastructure that once produced a neutral evidentiary record on these questions has thinned considerably.⁵⁰ ⁵¹ ² Engagement letters, voting rationales published contemporaneously, and comment submissions in state and federal rulemaking are no longer supplements to the process. For the moment, they are the process.

VIII. Conclusion

Buxton Helmsley has written throughout this series about the progressive weakening of the mechanisms by which outside investors verify what companies tell them—the auditor’s opinion whose ownership is now undisclosed, the going-concern warning that vanished as bankruptcies climbed, the evidentiary standards that have not caught up to costless forgery, the interim disclosures a rulemaking proposal would remove.⁶⁰ Those are all questions about what a company is required to say. This one is different: it concerns what a shareholder is permitted to find out, and what happens when the answer changes by a vote that does not describe itself as changing it.

The instruments at issue are unglamorous. Inspection demands, derivative standing, proposal eligibility, and the right to a jury are procedural provisions that most shareholders of most companies will never invoke in a lifetime of ownership. That is exactly the point. They are insurance, and insurance is valued in the state of the world in which it is needed rather than in the state of the world in which it is not. The premium is now being cancelled by ballot, in transactions marketed on the strength of franchise-tax savings and judicial predictability, and at companies where the vote is frequently determined before it is called.

We do not know whether any of this will prove costly, and neither, on the present record, does anyone else. What we know is that the American shareholder’s ability to compel the production of a document is smaller in July 2026 than it was in January 2024; that it became smaller in three jurisdictions in the same eighteen months; that in the two jurisdictions gaining charters the decision to make it smaller still rests with the board rather than the shareholders; and that the proxy statements asking shareholders to approve the arrangement have not, as a matter of practice, been required to say so.

Before the next proposal reaches a vote, investors are entitled to three answers that were unnecessary two years ago: which provisions is this board adopting, which is it foreclosing, and which is it reserving the right to adopt later without asking us again. Until boards answer those questions in the charter rather than in the summary, the prudent assumption is the one that governs every reserved option—that an option retained is an option someone intends to be able to exercise, and that if the answer were reassuring, it would already be in the document.

Referenced Sources:

[1] Lehot, L., Daugherty, P., Babcock, C.J. & Converse, C., “DExit One Year Later: An Assessment of SB21, the Continuing Pace of Reincorporation and the Maturation of Texas as a Corporate Domicile,” Foley & Lardner LLP, May 29, 2026, https://www.foley.com/insights/publications/2026/05/dexit-one-year-later-an-assessment-of-sb21-the-continuing-pace-of-reincorporation-and-the-maturation-of-texas-as-a-corporate-domicile/ (reporting approximately 49 Delaware-incorporated public corporations submitting re-domestication proposals between January 2024 and March 2026; 26 proposals submitted in 2025, of which 21 were approved by vote and seven by written consent; Delaware’s share of United States initial public offering incorporations falling from approximately 80–93 percent over the prior decade to approximately 62 percent in 2025, with Nevada at approximately 17 percent and Texas at approximately 4 percent; Coinbase Global’s completion of its Texas conversion on December 15, 2025 with approximately 78 percent of voting power and the company’s accompanying public statements; the convening of the Texas Business Court in September 2024 and the legislative drafting of Senate Bill 29; Delaware franchise tax citations in the proxy materials of reincorporating companies; the observation that private companies represent approximately two-thirds of Delaware franchise revenue; and plaintiffs’ counsel scrutiny of re-domestication proxies advancing generalized litigation rationales).

[2] Crozier, A.B., Wolf, G.E. & Kovacs, J.L., “2026 Proxy Season Trends: The Fracturing of Shareholder Power,” Innisfree M&A Incorporated, Harvard Law School Forum on Corporate Governance, June 11, 2026, https://corpgov.law.harvard.edu/2026/06/11/2026-proxy-season-trends-the-fracturing-of-shareholder-power/ (reporting Institutional Shareholder Services data that 33 Delaware corporations proposed redomiciling to Nevada (24) or Texas (9) for meetings held from January 2025 to May 2026; that 12 were controlled companies, four affiliated with a single family; that proposals also passed at seven companies with founder or insider groups holding between 25 and 50 percent; that only six of 14 proposals at non-controlled companies were approved and the remaining eight failed or were withdrawn, with ISS or Glass Lewis having recommended against in each of the eight; Vanguard’s disclosed 2025 voting rationale on redomiciliation proposals; the operation and scope of ExxonMobil’s retail voting program and the adoption of a comparable program by one other public company; the D.C. Circuit’s July 2025 invalidation of the SEC’s 2020 proxy adviser rules; Executive Order 14366 of December 2025; Federal Trade Commission investigations of the proxy advisory industry; state enforcement actions in Florida, Missouri, and Texas; Glass Lewis’s announced retirement of its benchmark policy in 2027; revised SEC guidance under Exchange Act Sections 13(d) and 13(g) and its chilling effect on issuer–index fund engagement; the division of stewardship functions at BlackRock, Vanguard, and State Street into two independently operating teams during the 2026 proxy season; and the decisions of JPMorgan and Wells Fargo to cease reliance on external proxy adviser recommendations).

[3] Bloomberg Law, “SEC Woes, DExit, and Lawsuits: Takeaways From 2026 Proxy Season,” July 2026, https://news.bloomberglaw.com/esg/sec-woes-dexit-and-lawsuits-takeaways-from-2026-proxy-season (reporting that ExxonMobil’s and Dell Technologies’ Texas reincorporation proposals received 71 percent and 97 percent support respectively notwithstanding Institutional Shareholder Services recommendations against both, and noting that ExxonMobil accords equal voting weight to every share while Dell maintains a dual-class structure weighting insider votes).

[4] Frank, K.T., Kimball, R.L. & Lyons, M.J., “Lessons from ExxonMobil,” Vinson & Elkins LLP, Harvard Law School Forum on Corporate Governance, June 10, 2026, https://corpgov.law.harvard.edu/2026/06/10/lessons-from-exxonmobil/ (reporting ExxonMobil’s reincorporation to Texas after 144 years of New Jersey domicile with approximately 71 percent of votes cast in favor at the 2026 annual meeting; the commencement of the company’s process in October 2025; the submission of proposals by non-controlled, widely-held companies including ArcBest and Texas Capital Bancshares, Inc., of which only ExxonMobil’s and ArcBest’s prevailed; ExxonMobil’s emphasis in its proxy materials that it declined to adopt the derivative litigation ownership threshold, the shareholder proposal ownership threshold, and the jury trial waiver; and the observation that ExxonMobil stopped short of committing not to adopt such provisions in the future, which under Texas law could be accomplished by board-only bylaw amendments without a shareholder vote).

[5] Dell Technologies Inc., Current Report on Form 8-K, filed July 1, 2026, U.S. Securities and Exchange Commission, https://www.sec.gov/Archives/edgar/data/0001571996/000157199626000036/dell-20260625.htm (reporting under Item 3.03, Material Modification to Rights of Security Holders, that the Texas corporation elected in Article XVI of its certificate of formation to be governed by provisions of the Texas Business Organizations Code providing that no shareholder or group of shareholders may institute or maintain a derivative proceeding against any director or officer in an official capacity unless, at the time the proceeding is instituted, the shareholder or group beneficially owns at least three percent of total outstanding shares; that the redomestication became effective July 1, 2026 at 12:01 a.m. Central Time; that as of the record date 276,744,341 shares of Class A common stock, 47,789,758 shares of Class B common stock, and 325,034,188 shares of Class C common stock were outstanding, with each Class A and Class B share entitled to ten votes and each Class C share entitled to one vote; and reporting final voting results on the redomestication proposal of 3,358,114,482 for, 107,690,029 against, 1,187,820 abstentions, and 56,296,513 broker non-votes on a combined basis, with Class A holders voting separately casting 2,767,249,771 votes for and none against or abstaining, and Class B holders voting separately casting 477,897,577 votes for and none against or abstaining). The Class C figures stated in the text are derived by Buxton Helmsley by subtracting the separately reported Class A and Class B results from the combined results disclosed in the same filing.

[6] Edwards, B.P., “July Reincorporation Update,” Business Law Prof Blog, July 8, 2026, https://www.businesslawprofessors.com/2026/07/july-reincorporation-update/ (reporting the simultaneous announcement of departures from Delaware by Energy Transfer LP, Sunoco LP, SunocoCorp LLC, and USA Compression Partners, collectively moving approximately $89 billion in equity value from Delaware to Texas, and noting that none of the four is organized as a corporation).

[7] Micheletti, E., David, B. & Wiseley, A., “Trends in Books and Records Litigation,” Skadden, Arps, Slate, Meagher & Flom LLP, Harvard Law School Forum on Corporate Governance, February 11, 2020, https://corpgov.law.harvard.edu/2020/02/11/trends-in-books-and-records-litigation (describing Section 220 demands as the primary tools available to stockholder plaintiffs for drafting derivative complaints, the increasing use of inspection in the merger context in advance of post-closing damages claims, and the extension of demands beyond formal board materials to electronic communications including emails and text messages from personal accounts and devices).

[8] Cooley LLP, “Delaware Amends Section 220 – Will Scope of ‘Books and Records’ Production Be Limited?,” Securities Litigation + Enforcement, March 27, 2025, https://sle.cooley.com/2025/03/27/delaware-amends-section-220-will-scope-of-books-and-records-production-be-limited/ (describing Section 220 as a qualified inspection right frequently serving as a precursor to derivative or class litigation; the historical limitation to formal documents and the Delaware courts’ steady expansion to emails, texts, and other informal documents extending back many years; the lowering of the proper-purpose threshold to a credible basis to suspect wrongdoing; and the retroactive application of the amendments to all demands made after February 17, 2025).

[9] Potter Anderson & Corroon LLP, “Books and Records Litigation: The Precursor to Derivative and Class Actions,” https://www.potteranderson.com/insights/publications/Books-and-Records-Litigation-The-Precursor-to-Derivative-and-Class-Actions (describing Section 220 demands as frequently preceding derivative and class litigation; the Delaware Supreme Court’s observation that a plaintiff’s failure to plead demand futility may be attributed to a failure to exhaust reasonably available means of gathering facts; and the general unavailability of discovery for the purpose of demonstrating demand futility).

[10] Skadden, Arps, Slate, Meagher & Flom LLP, “Books and Records Demands 2023 Recap: Courts Continue To Develop the Law Regarding the Scope of Inspection,” December 2023, https://www.skadden.com/insights/publications/2023/12/insights-the-delaware-edition/books-and-records-demands-2023-recap (reporting a record number of books and records actions before the Court of Chancery and the assignment of such actions to magistrates in an effort to manage the court’s docket).

[11] Delaware General Assembly, Senate Substitute 1 for Senate Bill No. 21, 153rd General Assembly, Bill Detail, https://legis.delaware.gov/BillDetail/141857 (describing amendments to Section 220 of Title 8 defining the materials a stockholder may demand to inspect, the conditions a stockholder must satisfy to obtain inspection, and the provision deeming information obtained through a Section 220 production to be incorporated by reference into any complaint subsequently filed by or at the direction of the stockholder on the basis of that information).

[12] Varnum LLP, “What Senate Bill 21 Means for Delaware Corporations,” April 2025, https://www.varnumlaw.com/insights/senate-bill-21-for-delaware-corporations/ (describing the statutory limitation of “books and records” to specified organizational and financial documents including annual financial statements for the preceding three years, board minutes, and stockholder communications, and the requirements that a demand describe its purpose and the records sought with reasonable particularity and that such records be specifically related to the proper purpose).

[13] Reed Smith LLP, “Delaware Court of Chancery Interprets Senate Bill 21’s Amended Books and Records Provisions in First Post-Enactment Decision,” https://www.reedsmith.com/our-insights/blogs/viewpoints/102mngu/delaware-court-of-chancery-interprets-senate-bill-21s-amended-books-and-records/ (reporting the Court of Chancery’s December 22, 2025 decision in Moran v. Unation, Inc., the first judicial interpretation of the amended Section 220, addressing the heightened evidentiary burdens stockholders must satisfy to obtain records beyond the newly defined categories and the additional procedural and evidentiary hurdles imposed by the new framework, including the requirement of a written demand under oath made in good faith and for a proper purpose).

[14] Morgan, Lewis & Bockius LLP, “Just Passed: Senate Bill Significantly Amends Delaware General Corporation Law,” March 26, 2025, https://www.morganlewis.com/pubs/2025/03/just-passed-senate-bill-significantly-amends-delaware-general-corporation-law (summarizing the amendments to DGCL Sections 144 and 220, the historical “necessary and essential” standard governing the scope of inspection, and the retroactivity carve-outs for actions already pending or demands made on or before February 17, 2025).

[15] Taft Stettinius & Hollister LLP, “Delaware Revamps Corporate Law With Senate Bill 21,” https://www.taftlaw.com/news-events/law-bulletins/delaware-revamps-corporate-law-with-senate-bill-21/ (describing the narrower statutory definition of books and records under Section 220(a)(1), the authority of corporations under Section 220(b)(3) to impose reasonable restrictions on the disclosure, use, and distribution of records and to redact portions not specifically related to the stockholder’s purpose, and the increased difficulty for stockholders in obtaining evidence supporting governance claims).

[16] Sidley Austin LLP, “Delaware Supreme Court Upholds Section 144 Safe Harbor Amendments,” March 2026, https://www.sidley.com/en/insights/newsupdates/2026/03/delaware-supreme-court-upholds-section-144-safe-harbor-amendments (reporting Rutledge v. Clearway Energy Group LLC, No. 248, 2025 (Del. Feb. 27, 2026), a unanimous 37-page opinion rejecting constitutional challenges to the Section 144 safe harbors and to their retroactive application, and noting that the Section 220 amendments applied retroactively subject only to a carve-out for litigation commenced or demands made before February 17, 2025).

[17] Jones Day, “Delaware Supreme Court Upholds Constitutionality of DGCL Amendments Adopted as SB 21,” March 2026, https://www.jonesday.com/en/insights/2026/03/delaware-supreme-court-upholds-constitutionality-of-dgcl-amendments-adopted-as-sb-21 (reporting the Delaware Supreme Court’s en banc decision of February 27, 2026 answering both certified questions in the negative, upholding the challenged provisions as a constitutional exercise of legislative power that preserved the Court of Chancery’s jurisdiction over fiduciary duty claims, and noting the State’s amicus submission through its Governor).

[18] Goodwin, S., “Dell, Exxon Moves Reveal Texas Corporate Law Isn’t Cut and Paste,” Bloomberg Law, June 24, 2026, https://news.bloomberglaw.com/legal-exchange-insights-and-commentary/dell-exxon-moves-reveal-texas-corporate-law-isnt-cut-and-paste (reporting ExxonMobil’s May 27, 2026 shareholder approval with 71.2 percent of votes cast and Dell Technologies’ June 25, 2026 scheduled vote; characterizing Texas corporate law as a menu of elective provisions rather than a single package; and urging boards to disclose which provisions are automatic, which are being adopted, and which are being left alone, and investors to vote on the package rather than the state name).

[19] Katten Muchin Rosenman LLP, “Texas Governor Signs New Business-Friendly Governance Law to Promote In-State Corporate Growth: Senate Bill 29 Analysis,” May 14, 2025, https://katten.com/texas-governor-signs-new-business-friendly-governance-law-to-promote-in-state-corporate-growth-senate-bill-29-analysis (describing new Section 21.218(b-2) permitting public and opt-in corporations to limit books and records requests during the pendency of adversarial or derivative litigation; new Section 2.116 authorizing jury trial waivers in governing documents, enforceable against persons who vote for or ratify the change and against continuing equity holders of a public company; the authority to designate one or more Texas courts as the exclusive forum and venue for internal governance claims; the prohibition on attorneys’ fee recovery in derivative proceedings whose sole outcome is additional or amended disclosure regardless of materiality; and the procedure for petitioning a court for a dispositive adjudication of special committee members’ independence).

[20] Sautter, C.M., “The Texas Reincorporation Trap—What the ExxonMobil Vote Reveals About Board Power,” The Texas Lawbook, March 31, 2026, https://texaslawbook.net/the-texas-reincorporation-trap-what-the-exxonmobil-vote-reveals-about-board-power/ (analyzing Texas Business Organizations Code Sections 21.373, 21.419, 21.552, 21.218, 2.115, and 2.116; reporting that the opt-in authority for the rights-limiting provisions belongs to the board rather than the shareholders and that a board may activate them by bylaw amendment with notice in a proxy statement and without shareholder approval; that Tesla amended its bylaws to impose the three percent derivative threshold the day after Senate Bill 29 was signed, when three percent was worth approximately $30 billion, and that Southwest Airlines followed two days later, with HeartSciences, Dillard’s, CenterPoint Energy, Legacy Housing Corporation, and TTEC Holdings subsequently adopting or proposing the threshold; that a three percent stake in ExxonMobil represented approximately $19 billion; that the Big Three index managers have brought derivative suits on behalf of portfolio companies twice in the historical record; that the most recent Federal Reserve data show a median value of total directly held stock among American families of $15,000; that Council of Institutional Investors data show Russell 3000 companies receiving a shareholder proposal on average once every 8.3 years with a median of one per year among those receiving any; that as of the date of publication no corporation had adopted the Senate Bill 1057 thresholds; that ExxonMobil stated it was not adopting rights-weakening provisions while ArcBest Corp. included an affirmative charter opt-out; that ExxonMobil’s retail investor base represents roughly 40 percent of outstanding shares; that in 2021 a hedge fund holding less than one quarter of one percent elected three ExxonMobil directors; and that the Council of Institutional Investors amended its reincorporation policy in March 2025).

[21] Tex. Bus. Orgs. Code § 21.218 (Examination of Records), as amended by Acts 2025, 89th Leg., R.S., Ch. 21 (S.B. 29), Sec. 5, eff. May 14, 2025, https://law.justia.com/codes/texas/business-organizations-code/title-2/chapter-21/subchapter-e/section-21-218/ (providing at Subsection (b) that a holder of shares for at least six months immediately preceding the demand, or a holder of at least five percent of outstanding shares, is entitled on written demand stating a proper purpose to examine specified records, and that “for purposes of this subsection” the records of the corporation do not include e-mails, text messages or similar electronic communications, or information from social media accounts unless the particular communication effectuates an action by the corporation; providing at Subsection (b-2), applicable only to a corporation with a class or series of voting shares listed on a national securities exchange or that has made an affirmative election to be governed by Section 21.419, that a demand shall not be for a proper purpose if the corporation reasonably determines it is made in connection with an active or pending derivative proceeding that is or is expected to be instituted or maintained by the holder or the holder’s affiliate, or an active or pending civil lawsuit to which the corporation or its affiliate and the holder or the holder’s affiliate are or are expected to be adversarial named parties; providing at Subsection (b-3) that Subsection (b-2) does not impair the holder’s rights to obtain discovery in such a lawsuit or derivative proceeding or to obtain a court order compelling production under Subsection (c); and providing at Subsection (c) that the section does not impair the power of a court, on proof of proper purpose, to compel production regardless of the period during which the holder held shares and regardless of the number of shares held). See also Texas Legislature, Enrolled S.B. No. 29, 89th Leg., R.S., https://capitol.texas.gov/tlodocs/89R/billtext/pdf/SB00029F.pdf (enrolled text of the amendments to Sections 1.002(55-a), 1.056, 2.116, 21.218, and 21.552); Texas Legislature Online, S.B. 29 Bill Analysis Supplement, https://legiscan.com/TX/supplement/SB29/id/562902 (describing new Section 21.552(a)(3), applicable to a corporation with common shares listed on a national securities exchange or a corporation that has made an affirmative election to be governed by Section 21.419 and has 500 or more shareholders, requiring that at the time the derivative proceeding is instituted the shareholder beneficially own shares sufficient to meet the required ownership threshold identified in the certificate of formation or bylaws, not to exceed three percent of outstanding shares, and describing the corresponding amendments adding parallel electronic-communications exclusions and derivative-standing thresholds for limited liability companies and limited partnerships); Sidley Austin LLP, “Texas Seeks to ‘Seize the Moment’ by Enacting Major Changes to Business Organizations Code,” Enhanced Scrutiny, May 30, 2025, https://ma-litigation.sidley.com/2025/05/texas-seeks-to-seize-the-moment-by-enacting-major-changes-to-business-organizations-code/ (noting that similar electronic-communications language was added to the default access provisions governing members of a limited liability company at Section 101.502(a) and partners in a limited partnership at Section 153.552(a), and summarizing the operation of Section 21.218(b-2)); Greenberg Traurig LLP, “Texas Business Organizations Code: Key Amendments Under SB 29,” July 2025, https://www.gtlaw.com/en/insights/2025/7/texas-business-organizations-code-key-amendments-under-sb-29 (observing that the Delaware corporate statute, by contrast, does not expressly empower a corporation to limit which shareholders may institute derivative proceedings).

[22] Seyfarth Shaw LLP, “Texas Adopts Business-Friendly Amendments to Its Corporate Code—A Response to Delaware?,” June 2, 2025, https://www.seyfarth.com/news-insights/texas-adopts-business-friendly-amendments-to-its-corporate-codea-response-to-delaware.html (summarizing Senate Bill 29 and Senate Bill 1057, the codification of the business judgment rule, ownership thresholds of up to three percent for derivative actions at public and opt-in corporations with 500 or more shareholders, inspection limits, the prohibition on fee awards in disclosure-only cases, the Senate Bill 1057 requirements of $1 million in market value or three percent of voting stock, six months of continuous ownership, and solicitation of holders of at least 67 percent of voting power, and the September 1, 2025 effective date).

[23] DLA Piper, “Federal court upholds law allowing Texas companies to set minimum ownership requirement for derivative lawsuits: Key takeaways,” March 2026, https://www.dlapiper.com/en-us/insights/publications/2026/03/federal-court-upholds-law-allowing-texas-companies-to-set-minimum-ownership-requirement (reporting the March 17, 2026 decision in Gusinsky v. Reynolds dismissing with prejudice; the adoption by Southwest Airlines’ board of the three percent derivative threshold on May 16, 2025, two days after Senate Bill 29’s enactment; the activist campaign by an investor group holding approximately 11 percent that preceded the underlying business changes; the plaintiff’s ownership of 100 shares; and the court’s rejection of the argument that an April 2025 pre-suit demand letter preserved standing, on the ground that a derivative proceeding commences only upon filing).

[24] Gibson, Dunn & Crutcher LLP, “Federal Court Enforces Texas SB 29 To Bar Derivative Suits By De Minimis Shareholder,” March 21, 2026, https://www.gibsondunn.com/federal-court-enforces-texas-sb-29-to-bar-derivative-suits-by-de-minimis-shareholder/ (reporting Gusinsky v. Reynolds, No. 3:25-cv-01816-K (N.D. Tex. Mar. 17, 2026), the plaintiff’s ownership of 100 shares out of approximately 491 million outstanding, the underlying claim arising from the elimination of the company’s free checked-baggage policy, and the amendment of the bylaws between the service of the demand letter and the filing of suit).

[25] A&O Shearman, “Texas court upholds first SB 29 shareholding threshold bylaw,” April 2026, https://www.aoshearman.com/en/insights/texas-court-upholds-first-sb-29-shareholding-threshold-bylaw (citing Gusinsky v. Southwest Airlines Co., 2026 WL 747179 (N.D. Tex. Mar. 17, 2026), describing the amendment to Section 21.552(a) of the Texas Business Organizations Code permitting corporations to bar derivative actions by shareholders holding less than three percent of outstanding shares, the activist fund’s acquisition of an 11 percent stake in 2024, and the court’s rejection of the plaintiff’s enforceability arguments).

[26] Southwest Airlines Co., Definitive Additional Proxy Materials, Form DEFA14A, U.S. Securities and Exchange Commission, 2026, https://www.sec.gov/Archives/edgar/data/0000092380/000119312526177565/d125950ddefa14a.htm (stating that following adoption of the ownership threshold a derivative lawsuit was filed by a shareholder beneficially owning 100 shares of common stock, representing less than 0.00002 percent of outstanding shares, and that on March 17, 2026 a federal district court dismissed the case on the ground that Texas law and the company’s bylaws barred the claims as a matter of law). See also Southwest Airlines Co., Quarterly Report on Form 10-Q for the period ended March 31, 2026, https://www.sec.gov/Archives/edgar/data/0000092380/000009238026000047/luv-20260331.htm (describing the derivative complaint and the motion to dismiss premised on Senate Bill 29 and the three percent ownership threshold bylaw).

[27] Jones Day, “Federal Court Upholds Texas’s Stock Ownership Threshold for Shareholder Derivative Claims,” March 2026, https://www.jonesday.com/en/insights/2026/03/federal-court-upholds-texass-stock-ownership-threshold-for-shareholder-derivative-claims (reporting the court’s characterization of Senate Bill 29, its holding that a demand letter is not a derivative proceeding, its rejection of the argument that the board’s adoption of the amended bylaws was itself an actionable breach on the ground that such a claim is also derivative and subject to the threshold, and its conclusion that Senate Bill 29 violated neither the Texas Constitution’s open courts provision nor its prohibition on retroactive laws).

[28] Griffith, S.J. & Lund, D.S., “Toward a Mission Statement for Mutual Funds in Shareholder Litigation,” University of Chicago Law Review (forthcoming), summarized by the authors at CLS Blue Sky Blog, Columbia Law School, August 1, 2019, https://clsbluesky.law.columbia.edu/2019/08/01/toward-a-mission-statement-for-mutual-funds-in-shareholder-litigation/; working paper at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3422910 (reporting a ten-year study of mutual fund participation in derivative suits, state law direct and class claims, appraisal actions, and private securities litigation, finding that the ten largest mutual funds were collectively involved in the filing of just ten traditional shareholder suits over the sample period, that those suits involved only five distinct instances of managerial misconduct, that all but one alleged violations of the federal securities laws with the remaining matter being an appraisal action, that the funds recorded zero instances of state law class or derivative litigation over the period, and that none served as lead plaintiff; and reporting by comparison that the ten largest public pension funds were involved in thirty-one shareholder suits against twenty-two different defendants, with the Louisiana Municipal Police Employees’ Retirement Fund alone involved in ninety-three shareholder claims over the same period).

[29] Jackson Walker LLP, “New Texas Law Applicable to ‘Nationally Listed Corporations’ Sets Forth Heightened Requirements for Shareholder Proposals,” https://www.jw.com/news/insights-texas-law-shareholder-proposals/ (describing Texas Senate Bill 1057, effective September 1, 2025, adding Section 21.373 to the Texas Business Organizations Code, and the framework governing when and how shareholders of nationally listed corporations may submit matters for a shareholder vote where the corporation affirmatively elects to be governed by the section, including holding at least the lesser of $1 million in market value of voting shares or three percent of outstanding voting shares determined on the submission date and holding continuously for at least six months before the meeting).

[30] Senate Research Center, Bill Analysis, S.B. 1057, 89th Legislature (Enrolled), Texas Legislature, https://capitol.texas.gov/tlodocs/89R/analysis/html/SB01057F.htm (setting out the author’s statement of intent; the federal Rule 14a-8 thresholds of $25,000 held one year, $15,000 held two years, and $2,000 held three years; the requirement that proposing shareholders solicit proxies from holders of at least 67 percent of shares entitled to vote; the provision that proposals failing the thresholds are ineligible under Texas law and need not be included under Rule 14a-8; and the calculation that the $1 million requirement is 500 times the one-year federal threshold and 40 times the three-year threshold).

[31] Winston & Strawn LLP, “Texas Governor Signs Law to Raise the Bar for Shareholder Proposals,” https://www.winston.com/en/blogs-and-podcasts/capital-markets-and-securities-law-watch/texas-governor-signs-law-to-raise-the-bar-for-shareholder-proposals (reporting the signing of Senate Bill 1057 on May 19, 2025 and its September 1, 2025 effective date; the eligibility criteria for a covered corporation; the mechanism by which a corporation opts in, namely amending its governing documents and providing notice to shareholders in a proxy statement; and the comparison with Rule 14a-8, under which the federal rule requires a longer minimum holding period of one year against Senate Bill 1057’s six months, imposes an ownership threshold significantly lower than Senate Bill 1057’s in most cases, and contains no solicitation requirement); Frank, K.T., Kimball, R.L. & Lyons, M.J., “Lone Star Ambitions: More Public Companies Propose Moving to Texas,” Vinson & Elkins LLP, 2026, https://www.velaw.com/insights/lone-star-ambitions-more-public-companies-propose-moving-to-texas/ (reporting that ArcBest expressly opted out of the Texas shareholder proposal threshold in its charter, with the effect that any future adoption would require a charter amendment, and describing the divergent approaches taken by non-controlled companies to the threshold).

[32] ISS Corporate Solutions, “U.S. Shareholder Proposals Jump to a New Record in 2023,” https://www.iss-corporate.com/resources/blog/us-shareholder-proposals-jump-to-a-new-record-in-2023/ (reporting, from a review of proposals submitted for Russell 3000 annual general meetings held between January 1 and May 31 in each year since 2019, that S&P 500 companies received 90 percent of shareholder proposals, and observing that proponents tend to focus on large capitalization companies); Meridian Compensation Partners, “Trends in Shareholder Proposals,” https://www.meridiancp.com/insights/trends-in-shareholder-proposals/ (reporting that over a three-year period 10 percent of companies in the Russell 3000 and 40 percent of companies in the S&P 500 included shareholder proposals in their proxy materials).

[33] Fenwick & West LLP, “Nevada Adopts Significant Amendments to its Corporate Law to Further Entice Corporations to Incorporate or Reincorporate in the State,” May 2025, https://www.fenwick.com/insights/publications/nevada-legislature-adopts-significant-amendments-to-its-corporate-law-to-further-entice-corporations-to-incorporate-or-reincorporate-in-the-state (reporting the unanimous Nevada Senate vote of May 21, 2025 and the signing of Assembly Bill 239 on May 30, 2025, effective immediately; the clarification of controlling stockholder fiduciary duties; the authorization of jury trial waivers in articles of incorporation; and the permission for certain holding company reorganizations).

[34] Brownstein Hyatt Farber Schreck, LLP, “Nevada Enacts Corporate Legislation and Advances Dedicated Business Court,” June 2025, https://www.bhfs.com/insight/nevada-enacts-corporate-legislation-and-advances-dedicated-business-court/ (describing the definition of a controlling stockholder as one having the voting power to elect a majority of directors; the safe harbor establishing a presumption of no breach of the limited fiduciary duty where a transaction is authorized or approved by a committee of disinterested directors or recommended to the board by such a committee; the clarification that the exercise or withholding of voting power does not itself indicate a breach; and Assembly Joint Resolution 8 proposing a constitutional amendment establishing a business court).

[35] Snell & Wilmer L.L.P., “Summer 2025 Corporate Communicator,” August 2025, https://www.swlaw.com/publication/summer-2025-corporate-communicator/ (describing the enforceable jury trial waiver a Nevada corporation may now include in its articles of incorporation for internal actions as defined in NRS 78.046, including actions brought in the right of the corporation, actions based on breach of fiduciary duty by directors, officers, employees, or agents, and actions arising under Nevada corporate law or the corporation’s governing documents; and the clarification that stockholders generally owe no fiduciary duties except as applicable to a controlling stockholder).

[36] KZA Law, “2025 Nevada Legislature – Changes to Corporate Matters and Litigation Procedures,” https://kzalaw.com/knowledge-center/employer-reports/2025-nevada-legislature-changes-to-corporate-matters-and-litigation-procedures/ (describing Assembly Joint Resolution 8’s proposed constitutional amendment authorizing a Nevada business court with exclusive jurisdiction over disputes involving shareholder rights, mergers and acquisitions, fiduciary duties, receiverships, and commercial disputes between business entities, and the requirement that the measure pass in a second legislative session and be approved by voters at a general election).

[37] Associated Press / LancasterOnline, “Exxon Mobil moving legal home from New Jersey to Texas with shareholders’ approval,” May 27, 2026, https://lancasteronline.com/business/stock_market/exxon-mobil-moving-legal-home-from-new-jersey-to-texas-with-shareholders-approval/article_0734de48-b0ef-508c-b953-332c7cbba566.html (reporting preliminary passage with a little over 70 percent of the vote; the failure of a similar proposal at Texas Capital Bancshares; the role of multi-class share structures and concentrated voting power at other redomiciled companies; and that proxy adviser opposition emphasized the possibility that the company might one day opt into Texas provisions permitting high ownership thresholds for shareholder proposals and derivative suits).

[38] Edwards, B.P., “Early May Reincorporation Update,” Business Law Prof Blog, May 4, 2026, https://www.businesslawprofessors.com/2026/05/early-may-reincorporation-update/ (quoting ArcBest’s description of the express opt-out provisions included in its Texas charter as furthering the board’s intent to preserve stockholders’ existing rights; reporting that Texas Capital Bancshares, Inc. included in its proposal a request for advisory approval to raise the ownership threshold for submitting shareholder proposals from the level provided under Commission rules to three percent of outstanding shares; and noting that Fidelity National Financial had taken a comparable opt-out approach in the prior year).

[39] Dell Technologies Inc., Definitive Proxy Statement on Schedule 14A for the 2026 Annual Meeting of Stockholders, filed May 15, 2026, U.S. Securities and Exchange Commission, https://www.sec.gov/Archives/edgar/data/0001571996/000119312526226734/d132444ddef14a.htm (disclosing that the Texas charter reflects the company’s election to be governed by the amended Texas Business Organizations Code provisions barring a derivative proceeding unless the shareholder or group beneficially owns at least three percent of outstanding stock at the time the proceeding is commenced; disclosing that, subject to stockholder approval of the redomestication proposal, the board of directors intended to approve an amendment to the Texas bylaws electing to be governed by Section 21.373 of the Code, upon the effectiveness of which a shareholder or group could submit a proposal, including one submitted under Rule 14a-8, only if it held voting shares equal to at least $1,000,000 in market value or three percent of voting shares as of the submission date, had held such shares continuously for at least six months prior to the meeting, and solicited holders of shares representing at least 67 percent of the voting power entitled to vote on the proposal; and containing sections captioned comparisons of the Delaware and Texas charters, of the Delaware and Texas bylaws, and of stockholder rights under Delaware and Texas law).

[40] Jasper Street, “Briefing on 2026 Reincorporation Trends,” 2026, https://www.jasperstreet.com/insights/reincorporation (reporting that among five 2026 year-to-date votes at sizeable widely-held companies seeking to redomicile to Texas or Nevada, average support was approximately 53 percent of shares outstanding and two of the five votes failed; that Institutional Shareholder Services and Glass Lewis opposed nearly all widely-held company reincorporations to Texas and Nevada in 2026; and that the largest institutional investors employ case-by-case analysis under evolving standards).

[41] Reuters, “Exxon wins shareholder backing for Texas move, defeats retail voting proposal,” May 27, 2026, https://finance.yahoo.com/sectors/energy/articles/exxon-wins-shareholder-backing-texas-152106074.html (reporting shareholder approval of the redomiciliation notwithstanding recommendations against by two leading proxy advisory firms, and the rejection of a shareholder proposal to add automatic voting options to the company’s retail investor voting program, which the board opposed).

[42] Maffei v. Palkon, No. 125, 2024 (Del. Feb. 4, 2025), https://law.justia.com/cases/delaware/supreme-court/2025/125-2024.html (addressing the decision by the directors, officers, and stockholders of Tripadvisor, Inc. and Liberty TripAdvisor Holdings, Inc. to change corporate domicile from Delaware to Nevada, the stockholders’ contention that the conversions conferred non-ratable benefits in the form of reduced liability exposure warranting entire fairness review, and the Court of Chancery’s contrary holding below).

[43] Paul, Weiss, Rifkind, Wharton & Garrison LLP, “Delaware Decision Applying Business Judgment Rule to ‘Clear Day’ Approval of Reincorporation,” CLS Blue Sky Blog, Columbia Law School, February 26, 2025, https://clsbluesky.law.columbia.edu/2025/02/26/paul-weiss-discusses-delaware-decision-applying-business-judgment-rule-to-clear-day-approval-of-reincorporation/ (reporting the unanimous en banc holding that the business judgment rule applies to a corporation’s decision to change its state of incorporation even where the move arguably favors a controlling stockholder by reducing future liability exposure, and the court’s articulation of what constitutes a material, non-ratable benefit).

[44] Cooley LLP, “Delaware Supreme Court Reverses Chancery Court, Holds Business Judgment Review Applicable to Tripadvisor’s Decision to Reincorporate in Nevada,” February 7, 2025, https://www.cooley.com/news/insight/2025/2025-02-07-delaware-supreme-court-reverses-chancery-court-holds-business-judgment-review-applicable-to-tripadvisors-decision-to-reincorporate-in-nevada (reporting the February 4, 2025 reversal and the holding that business judgment review applied because no member of the board, including the alleged controller, received a material non-ratable benefit, and because no existing or threatened litigation was alleged at the time of the decision).

[45] Morris James LLP, “Delaware Supreme Court Applies Business Judgment Rule, Dismisses Stockholder Claims Arising from TripAdvisor’s Nevada Reincorporation,” https://www.morrisjames.com/p/102kprm/delaware-supreme-court-applies-business-judgment-rule-dismisses-stockholder-clai/ (reporting that the board received presentations stating that Nevada law makes it relatively more difficult for stockholders to bring fiduciary duty claims against directors, officers, and controlling stockholders than Delaware law, and that the board and a stockholder holding more than 50 percent of the vote approved the reincorporation while minority stockholders voted overwhelmingly against it).

[46] Nolledo, S., Wenger, S. & Wendt, A., “The State of US Reincorporation in 2025: The Growing Threat and Reality of ‘DEXIT,’” Glass, Lewis & Co., October 2025, https://www.glasslewis.com/article/state-of-us-reincorporation-2025-growing-threat-reality-dexit (reporting that of 18 companies proposing to leave Delaware in 2025, 13 sought to move to Nevada and two to Texas; that 55 percent of reincorporation proposals that season involved companies with significant or controlling shareholders; and that 29 reincorporation proposals were evaluated during the season).

[47] Jetley, G. & Mulford, N., “DExit Trends: Tracking Reincorporations Away from Delaware,” Analysis Group, February 2026, https://www.analysisgroup.com/Insights/ag-feature/dexit-trends-tracking-reincorporations-away-from-delaware/ (reporting, on the basis of an analysis of Securities and Exchange Commission filings published through the Harvard Law School Forum on Corporate Governance, that Delaware experienced a net loss of 11 large public companies through reincorporation in the period from 2024 through the second quarter of 2025 compared with a net gain of four firms in 2022–2023, and that as of the second half of 2025 there were 3,396 United States-headquartered companies with market capitalizations greater than $250 million listed on the New York Stock Exchange or Nasdaq).

[48] Executive Order 14366, “Protecting American Investors From Foreign-Owned and Politically-Motivated Proxy Advisors,” December 11, 2025, published at 90 Fed. Reg. (Dec. 16, 2025), https://www.federalregister.gov/documents/2025/12/16/2025-23093/protecting-american-investors-from-foreign-owned-and-politically-motivated-proxy-advisors (directing the Chairman of the Securities and Exchange Commission to consider revising or rescinding rules, regulations, guidance, bulletins, and memoranda inconsistent with the order, especially those implicating diversity, equity, and inclusion and environmental, social, and governance policies, and separately directing consideration of revision or rescission of rules relating to shareholder proposals, including Rule 14a-8); Carlton Fields, “What Part Will the SEC Play in Proxy Adviser Drama? Agency’s Role and Script Remain Elusive,” December 2025, https://www.carltonfields.com/insights/publications/2025/what-part-will-the-sec-play-in-proxy-adviser-drama-agency-role-and-script-remain-elusive (describing the order’s assignment of responsibilities to the Commission, the Department of Labor, and the Federal Trade Commission, and reporting that the Commission’s historical interpretation of proxy voting recommendations as solicitations was rejected in July 2025 in Institutional Shareholder Services Inc. v. SEC, in which the D.C. Circuit upheld the district court’s vacatur of the rule provision incorporating that interpretation, emphasizing that proxy advisory firms do not initiate proxy solicitations, seek proxy authority for themselves, or act as agents empowered to vote on shareholders’ behalf); Hodgman, M., Bieber, E., Gerding, E. & Nicolardi, D., “Proxy Voting Advice No Longer a Solicitation Under the Exchange Act,” Freshfields Bruckhaus Deringer LLP, Harvard Law School Forum on Corporate Governance, July 2025, https://corpgov.law.harvard.edu/2025/07/page/2 (reporting the July 1, 2025 decision and its effect on the Commission’s authority).

[49] Gibson, Dunn & Crutcher LLP, “Texas Court Blocks Enforcement of New Texas Proxy Advisor Law Against ISS and Glass Lewis,” August 31, 2025, https://www.gibsondunn.com/texas-court-blocks-enforcement-of-new-texas-proxy-advisor-law-against-iss-and-glass-lewis/ (reporting the August 29, 2025 preliminary injunctions entered in Institutional Shareholder Services Inc. v. Paxton and Glass, Lewis & Co., LLC v. Paxton barring enforcement of Texas Senate Bill 2337 against the two firms, and the trial date of February 2, 2026).

[50] Morgan, Lewis & Bockius LLP, “SEC Division of Corporation Finance Announces Major Changes to Rule 14a-8 Shareholder Proposal Process,” November 19, 2025, https://www.morganlewis.com/pubs/2025/11/sec-division-of-corporation-finance-announces-major-changes-to-rule-14a-8-shareholder-proposal-process (reporting the Division of Corporation Finance’s November 17, 2025 announcement that it would not respond to no-action requests or express views on companies’ intentions to exclude shareholder proposals for the 2026 proxy season other than under Rule 14a-8(i)(1), and the cited rationales of staff resource and timing constraints, a filing backlog, and the existing body of prior guidance).

[51] Congressional Research Service, “The Shareholder Proposal Rule,” R48855, February 11, 2026, https://www.congress.gov/crs-product/R48855 (reporting that in October 2025 the SEC Chairman announced changes in staff understanding of Rule 14a-8 that could lay the groundwork for substantial narrowing of the rule, endorsed a fundamental reassessment of the rule including its premise that shareholders should be able to compel companies to solicit for their proposals at little or no personal expense, and that the Commission’s regulatory flexibility agenda forecast proposed amendments to Rule 14a-8 in the spring of 2026).

[52] Harvard Law School Forum on Corporate Governance, “SEC Chairman Signals Reassessment of Rule 14a-8 Regime,” July 15, 2026, https://corpgov.law.harvard.edu/2026/07/15/sec-chairman-signals-reassessment-of-rule-14a-8-regime/ (reporting the Chairman’s statement that the decision not to respond to no-action requests during the 2025–2026 proxy season did not produce the disruption many anticipated, that exclusion trends remained consistent with prior years, that six lawsuits were filed against companies for excluding proposals, that most companies excluding proposals were not penalized by proxy advisers, and that he would not direct the staff to resume issuing no-action letters).

[53] Exxon Mobil Corporation, SEC Staff No-Action Letter and Request Letter (Sept. 15, 2025), as reported in Arnold & Porter, “SEC Confirms No Enforcement Recommendation for the Exxon Mobil Retail Voting Program,” September 2025, https://www.arnoldporter.com/en/perspectives/advisories/2025/09/sec-no-enforcement-recommendation-exxon-mobil-retail-voting-program (reporting the September 15, 2025 no-action response of the Division of Corporation Finance under Exchange Act Rules 14a-4(d)(2) and 14a-4(d)(3), and the features on which the staff position rested, including limitation to retail investors, opt-in and opt-out design, annual reminders to participants, and the ability of participants to override standing instructions for an upcoming meeting); Dorsey & Whitney LLP, “SEC Gives Green Light to ExxonMobil’s Retail Voting Program,” October 2025, https://www.dorsey.com/newsresources/publications/client-alerts/2025/10/retail-voting-program (reporting the exclusion of registered investment advisers exercising voting authority for clients, the universal availability of the program to retail holders at no cost, the annual reminder and override mechanics, and the company’s adoption of the program and filing of related election materials on September 17, 2025); Harvard Law School Forum on Corporate Governance, “Applying A Retail Voting Program in Practice,” October 14, 2025, https://corpgov.law.harvard.edu/2025/10/14/applying-a-retail-voting-program-in-practice/ (reporting that of the nearly 40 percent of the company’s outstanding shares held by retail shareholders, only one quarter of those shares, or approximately 10 percent of outstanding shares, were voted at the last annual meeting); ProMarket, Stigler Center, University of Chicago Booth School of Business, “Why the Controversy Behind ExxonMobil’s New Retail Voting Program?,” November 16, 2025, https://www.promarket.org/2025/11/16/why-the-controversy-behind-exxonmobils-new-retail-voting-program/ (describing the two available standing instructions, committing votes either to the board’s recommendation on all matters or on all matters other than contested director elections, mergers and acquisitions, and divestitures); Lexology, “Exxon Mobil’s novel retail voting program: The future of shareholder voting?,” November 2025, https://www.lexology.com/library/detail.aspx?g=2cdbf0e0-86af-479f-b74a-1b26866bcd6c (reporting the company’s representation that 90 percent of the retail shareholders who voted at meetings over the preceding five years supported all of the board’s recommendations).

[54] Debevoise & Plimpton LLP, “Key Considerations for the 2026 Proxy Season,” Harvard Law School Forum on Corporate Governance, January 30, 2026, https://corpgov.law.harvard.edu/2026/01/30/key-considerations-for-the-2026-proxy-season/ (reporting that in 2025 the Division of Corporation Finance granted no-action relief to ExxonMobil in connection with its retail voting program permitting retail shareholders to provide standing instructions to vote in line with board recommendations, and summarizing the December 2025 executive order, the Florida attorney general’s lawsuit, the Federal Trade Commission investigation, and congressional and state action directed at proxy advisory firms).

[55] Richards, Layton & Finger, P.A., “Overview of the DGCL’s Newly-Enacted Safe Harbor Procedures and Books and Records Regime,” April 2025, https://www.rlf.com/overview-of-the-dgcls-newly-enacted-safe-harbor-procedures-and-books-and-records-regime/ (stating that the amendments to Sections 144 and 220 were intended to reduce the costs and burdens associated with excessive stockholder litigation, particularly in suits involving controlling stockholders and actions to inspect corporate books and records, and that the Section 220 amendments statutorily define the scope of books and records available for inspection).

[56] Delaware Office of Management and Budget, “Financial Summary,” Governor’s Recommended Budget, Fiscal Year 2027, https://budget.delaware.gov/budget/fy2027/documents/operating/financial-summary.pdf (reporting Corporate Franchise and Related revenue, inclusive of corporate franchise taxes, business entity fees, and limited partnership and limited liability company taxes, at 29.2 percent of General Fund sources, second only to personal income tax at 35.8 percent, with Franchise Tax forecast at $1,328.9 million for Fiscal Year 2027).

[57] WHYY, “Delaware Gov. Meyer has yet to release corporate franchise tax revenue data,” March 27, 2026, https://whyy.org/articles/delaware-incorporation-growth-tax-revenue/ (reporting that the corporate franchise tax accounts for nearly a third of Delaware’s budget and is the State’s second-largest revenue source after personal income tax; that business entities formed in Delaware increased from 2.1 million in 2024 to 2.2 million in 2025; and that Delaware Economic and Financial Advisory Council materials showed corporate franchise tax revenue flat between December 2025 and March 2026 with no growth projected for fiscal years 2027 and 2028).

[58] Delaware Public Media, “May DEFAC: corporate franchise revenue up 1% from 2025,” May 19, 2026, https://www.delawarepublic.org/2026-05-19/may-defac-corporate-franchise-revenue-up-1-from-2025 (reporting corporate franchise revenue of approximately $1.32 billion in Fiscal Year 2025 and $1.33 billion in Fiscal Year 2026, combined limited liability company and limited partnership revenue projected at $1.89 billion, and the characterization of the combined revenue as approximately one third of the State’s annual operating budget).

[59] Alliance Advisors, “2026 U.S. Proxy Season Preview,” April 2026, https://allianceadvisors.com/2026-u-s-proxy-season-preview/ (reporting that several companies, including Forward Industries and Texas Capital Bancshares, were availing themselves of the Senate Bill 1057 shareholder proposal thresholds as part of their moves to Texas, with Texas Capital Bancshares holding a separate advisory vote on the provision at its April 21 annual meeting; and describing the diminishing influence of proxy advisers, Glass Lewis’s planned retirement of its benchmark voting policies in 2027, the migration of proxy research and voting in-house at several large asset managers, and the increasing consequence of retail votes through pass-through and auto-voting programs).

[60] See Buxton Helmsley, “The Leveraged Opinion: How Private Equity Bought Its Way Into the Audit Profession—and What Institutional Investors Must Demand Before They Rely on the Next Clean Audit Report,” Insights (July 14, 2026); Buxton Helmsley, “Presumed Genuine: How Generative AI Made Forgery Free While Audit Standards Still Permit Auditors to Take Documents at Face Value—and What Institutional Investors Must Demand Before the Rules Catch Up,” Insights (July 2, 2026); Buxton Helmsley, “The Disappearing Quarter: How the SEC’s Semiannual Reporting Proposal Would Hollow Out the Architecture of Interim Disclosure—and What Institutional Investors Must Demand Before the Comment Window Closes,” Insights (June 10, 2026); Buxton Helmsley, “Going Concern, Going Missing: How the Auditor’s Most Important Opinion Disappeared as Bankruptcies Climbed,” Insights (May 18, 2026).

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