After news broke on the last day of January that Meta might follow Elon Musk’s lead in exiting Delaware to incorporate in another state, Democratic Governor Matt Meyer sprung into action.

Delaware has long been the dominant state for U.S. companies to incorporate due to its flexible corporate code and expert judiciary. More than 20% of the state’s tax revenue, amounting to more than $1 billion a year, has historically come from corporate franchise fees, so state lawmakers can ill afford to preside over a mass exodus, or what’s been dubbed a “DExit.”

On Saturday, Feb. 1, a day after the Wall Street Journal published its story on Meta considering a Delaware departure, Gov. Meyer, who was brand new to the job, convened an online meeting with attorneys from law firms that have represented Meta, Musk, Tesla and others in shareholder disputes in the state, according to public records obtained by CNBC. Other attendees included members of the Delaware legislature.

The purpose of the meeting was to have a “Discussion re: Corporate Franchise,” one memo said.

The following day, records show, Meyer invited a second group to meet with him and new Secretary of State Charuni Patibanda-Sanchez. That invitation went to Kate Kelly, Meta’s corporate secretary, and to Dan Sachs, the company’s senior national director of state and local policy.

The invite also went to James Honaker, an attorney with Morris Nichols, a firm that’s represented Meta in federal court in Delaware, and to William Chandler, former chancellor of the Delaware Court of Chancery, who is now part of Wilson Sonsini’s Delaware litigation practice.

Roughly two weeks later, Delaware lawmakers were being asked to vote on a a bill, known as SB 21, that, if enacted, would overhaul the state’s corporate law in a manner that could favor Musk, Zuckerberg and other controlling shareholders of large companies.

Among other things, SB21 would alter how companies can use independent directors to ensure the deals they’ve made will not be subject to court scrutiny, and would limit the records that shareholders can obtain from companies when investigating possible breaches of fiduciary duty.

Late last week, the state Senate voted to pass an amended version of SB 21. If Delaware’s House of Representatives follows suit, in a vote expected as soon as Thursday, the bill would head to the governor’s desk to be signed into law.

That could remove a major overhang for Zuckerberg and Meta.

Meta has been the subject of “books and records” investigations in Delaware in recent months, according to two people directly involved in the matter who asked not to be named in order to discuss non-public investigations. Under current law, shareholders behind those probes could file cases alleging that Zuckerberg or other Meta directors caused billions of dollars in damages, according to the people and Delaware records viewed by CNBC.

If SB 21 passes, any claims filed after Feb. 17, the day the bill was brought to the assembly, would be considered under the new law. That means shareholders wouldn’t have the benefit of the current law, and investor protections that come with it, when their new claims are considered in Delaware court.

A Meta spokesperson declined to comment.

Mila Myles, a spokeswoman for Gov. Meyer, said in a statement that the governor has spent his first few weeks on the job meeting with “plaintiffs attorneys, Delaware corporate attorneys and countless Delaware incorporated companies,” adding that he is not “doing the bidding of any billionaire.”

Musk drew national attention to Delaware’s corporate law in 2024 after a judge there ruled that his $56 billion Tesla pay package from 2018 was illegally granted and should be rescinded. He wrote on X, “Never incorporate your company in the state of Delaware,” and subsequently moved Tesla to Texas while accusing the judge behind the ruling of “absolute corruption.“

Musk also became a top donor to Donald Trump’s presidential campaign, and is now a lead adviser to his White House, running the so-called Department of Government Efficiency.

Zuckerberg, who had a notably rocky relationship with Trump during the president’s first term, has been publicly currying favor this go-round. He’s taken measures like ending Meta’s diversity, equity and inclusion (DEI) programs, getting rid of third-party factcheckers in favor of a “Community Notes” model used by Musk’s X platform, and adding Dana White, CEO of the Ultimate Fighting Championship and a longtime friend of Trump, to his company’s board weeks before the new administration began.

Meta also agreed in January to pay $25 million to settle a four-year-old lawsuit over the company’s decision to suspend Trump’s accounts after the Jan. 6 Capitol riot.

News that Zuckerberg was considering a move out of Delaware landed a little over a week after President Donald Trump’s inauguration, which the Meta CEO attended along with other tech leaders.

Meta hasn’t publicly commented on whether it plans to reincorporate outside of the state.

As CNBC previously reported, authors of SB 21 included Richards, Layton & Finger, a corporate defense firm that counts Musk and Tesla as clients. It was co-written by Delaware Law School professor Lawrence Hamermesh, as well as Chandler, the ex-chancellor, and former Delaware Supreme Court Justice Leo Strine. 

Strine works for Wachtell, Lipton, Rosen and Katz, which is representing Zuckerberg in a separate matter tied to the company’s involvement in the 2018 Cambridge Analytica scandal. In 2019, Meta agreed to pay a $5 billion fine to settle related charges with the FTC.

SB 21 was introduced to Delaware’s General Assembly on Feb. 17, by Senate Majority Leader Bryan Townsend, who had attended the first of the two meetings held by Gov. Meyer. The process of drafting the bill didn’t follow Delaware’s traditional practice of changing corporate law, which typically involves writing and review by the state’s bar association, and a committee within it called the Corporation Law Council.

Reforms outlined in SB 21 have been supported by corporate defense firms and attorneys, including those who helped draft the bill. They’ve been vociferously opposed by shareholders’ attorneys and investment groups, including CalPERS and ICGN, who say they want to ensure that controlling shareholders don’t make self-interested deals or decisions that go against the wishes and rights of the broader investor base.

On Feb. 2, Myles from the governor’s communications office shared a memo with legislators and attorneys who had attended the weekend meetings. It included a list of talking points in defense of SB21.

The memo, obtained by CNBC, said Delaware prides itself on serving as “home to the world’s leading companies,” having the “best law and jurisprudence” for businesses, and remains the “premier destination in America for business formation.”

“Whenever an entity — regardless of size — exits Delaware for one of our sister jurisdictions, our goal is to earn their business back,” the memo said. “In many cases, companies that reincorporate out of Delaware return to Delaware.”

Read the public records here: