Texas Capital CEO Blames Proxy Advisers as DExit Vote Fails

Texas Capital Bancshares plans to put its reincorporation to Texas back before shareholders this year, after the first attempt failed in April with 45% support. CEO Rob Holmes is not softening his message.

On the bank's second-quarter earnings call last week, Holmes called proxy advisory firms Glass Lewis and Institutional Shareholder Services "irresponsible, uninformed" and said they wield "too much power." Both firms recommended shareholders vote against the proposal, arguing that leaving Delaware would weaken shareholder rights.

An ISS spokesperson pushed back Tuesday, saying the firm provides "independent and apolitical research and recommendations" based on criteria its institutional clients choose. "It is they who ultimately decide how to vote on proxy matters," the spokesperson said. Glass Lewis declined to comment.

The $33.9 billion-asset Dallas bank drew about 18.2 million shares in favor of redomiciling and more than 22 million against, with over 30,000 abstaining. Holmes said the bank's institutional investors, which outnumber retail holders, listened to "irresponsible, uninformed proxy advisors."

Holmes told American Banker there is "not one drawback" to switching to Texas law. "I cannot think of one reason why we shouldn't be incorporated in the state of Texas," he said.

Texas Capital's board first discussed the idea in July 2025, two months after Texas amended its Business Organizations Code. The changes codified the business judgment rule for publicly traded companies, meaning courts will review board decisions under clearer standards. The amendments also require shareholders to hold a minimum number of shares for a minimum period before they can sue. Texas launched a specialized Business Court to handle corporate disputes.

The bank said redomiciling would save $200,000 a year in Delaware franchise taxes. Texas franchise taxes would not increase.

Glass Lewis and ISS both argued that the switch would make it harder for shareholders to file derivative suits or prove directors violated fiduciary duties. ISS wrote that a combination of greater board flexibility to consider non-shareholder interests and higher hurdles for court challenges "could leave shareholders with little recourse" if the board rejects a value-maximizing deal.

Holmes said the bank has not spoken with either advisory firm, before or after the vote. Conversations with shareholders will determine whether Texas Capital holds a special meeting or waits until next year's annual meeting. "We're going to do what we always do," he said. "Continue to engage with our shareholders and talk to them about why this makes sense."

The trend of companies leaving Delaware – dubbed "DExit" – is accelerating. Tesla, Coinbase, and Dell Technologies have all reincorporated in Texas. Exxon Mobil's proposal passed with 71% support, according to a securities filing.

Byron Egan, a partner at Jackson Walker in Dallas, called Texas Capital's failed vote an "aberration" tied to its large institutional investor base. He said it should not be read as a signal for other banks. Texas is courting these moves partly to drive listings on the new Texas Stock Exchange, Egan wrote in a May 2026 article for The Texas Lawbook.

Dell Technologies carries an Alpha Score of 52/100 from AlphaScala, in the Mixed range, within the Technology sector. Investors tracking the DExit trend can find DELL stock page and broader stock market analysis.