As if eXp World Holdings, which includes eXp Realty, hadn’t made enough big news with its acquisition of NextHome on May 7, the company held a shareholder vote May 8 seeking to reincorporate from Delaware to Texas. The result, which followed a week delay, was announced as approved May 12 and formally filed with the SEC.
The approval required the affirmative vote of the majority of the company’s outstanding shares of common stock entitled to vote as well as the majority of the company’s outstanding shares of common stock not owned, directly or indirectly, by members of the board.
The vote based on all shares of common stock entitled to vote on the proposal was 80 million in favor and 37 million opposed, with 269,000 abstentions. The vote based on the company’s outstanding shares of common stock not owned, directly or indirectly, by members of the board was 40 million in favor and 37 million opposed.
The maneuver had been contested by some investors following multiple lawsuits, though eXp maintained that the shift was a long-planned strategic move for better governance.
In a letter to stockholders before the vote, Glenn Sanford, eXp founder and CEO, explained the thinking behind the decision.
“At this year’s Annual Meeting, stockholders are being asked to approve a proposal to reincorporate eXp World Holdings from Delaware to Texas,” he wrote. “After careful deliberation the Board unanimously approved this proposal because we believe Texas offers a governance environment that is clearer, more predictable, and better suited to a company of our size and complexity. This is not a structural change to how we operate. It is a thoughtful evolution of the framework within which we operate–one that serves the long-term interests of our stockholders, our agents, and the business.”
Sanford’s point was that a move to Texas could shift eXp’s legal home to a more board-friendly jurisdiction which has undertaken 2025 reforms that solidify officer liability protections and streamline corporate governance. Key changes include potential limits on director/officer liability, upgraded control over shareholder litigation and reduced voting requirements for major transactions.
In a supplemental filing with the SEC April 21, the company stated that the proposal “is the product of a Special Committee of independent directors” backed by three outside law firms, and that the process “began more than a year ago and reflects a deliberate strategic review rather than a reaction to litigation.”
On April 7 a federal judge ruled that eXp must face accusations of fraud related to its actions in the wake of sexual assault allegations against top recruiters, writing that plaintiffs provided significant evidence that the brokerage lied about conducting an investigation into two men accused of drugging and assaulting women at company events.
This followed last fall’s lawsuits from former agents and recruits along with scrutiny from the New York City Comptroller’s office, with eXp and several current and former executives and board members facing a suit by public pension funds, who alleged that the company breached its fiduciary duty in covering up reports of rape by “dozens” of top agents, as well as making new claims regarding retaliation and self-dealing at the highest level.
