PROPOSAL 1—APPROVAL OF AN AMENDMENT TO OUR CERTIFICATE OF INCORPORATION GENERAL INFORMATION
Shareholder Proposals and Nominations forBackground
The Board believes it is in the
2021 Annual Meeting of Shareholders Any proposal that a qualified shareholderbest interest of the Company wishes to includeincrease the total number of authorized shares from 122,500,000 to 222,500,000 shares and the number of authorized shares of common stock from 120,000,000 to 220,000,000 shares. These shares do not offer any preemptive rights. This proposal to increase the number of shares of common stock authorized for issuance, if approved at the Special Meeting, will become effective and the Company’s total number of authorized shares will be increased to 222,500,000 shares upon the filing of the certificate of amendment with the Secretary of State of the State of New Jersey. The following discussion is qualified in its entirety by the full text of the proposed amendment to the first paragraph of Article III of the certificate of incorporation, which is included below.
General
We are asking shareholders to confirm and approve an amendment to our certificate of incorporation to increase the number of total authorized shares from 122,500,000,000 shares to 222,500,000 shares and the number of authorized shares of common stock from 120,000,000 shares to 220,000,000 shares.
The additional common stock will have rights and privileges identical to our currently outstanding common stock. The number of authorized shares of our preferred stock will not be affected by this amendment; it will be maintained at 2,500,000 shares. No shares of preferred stock have been issued, and we currently have no plans, arrangements, commitments or understandings with respect to the issuance of any shares of preferred stock.
The reason for the proposed amendment is to increase our flexibility to use our common stock for business and financial purposes, and to allow such shares to be issued without the expense and delay of an additional special shareholders’ meeting, except as may be required by applicable law, regulatory agencies or the rules of the New York Stock Exchange (“NYSE”). The Board believes it is desirable for us to have the flexibility to issue, without further shareholder action, additional shares of common stock in excess of the amount that is currently authorized. Such shares would be available for issuance from time to time as determined by the Board for any proper corporate purpose.
Vote Required and Board Recommendation
Approval of the Charter Amendment to increase the authorized shares of common stock requires the affirmative vote of a majority of the votes cast by the holders of shares entitled to vote thereon at the Special Meeting.
Purpose of Proposed Amendment
Our common stock consists of a single class, with equal voting, distribution, liquidation and other rights. As of July 31, 2020, of our 120,000,000 shares of common stock that had been authorized, 100,586,050 shares were outstanding. In addition, there were 803,701 shares underlying outstanding equity awards granted under our equity incentive plans, 0 shares underlying outstanding equity awards granted outside of our equity incentive plans, and 1,211,360 shares reserved for future issuance under our equity incentive plans.
As of July 31, 2020, approximately 98% of our currently authorized common stock was either issued and outstanding, or shares reserved for issuance under all of the issuer’s plans. The Board of Directors does not believe that we currently have enough shares authorized to provide for sufficient flexibility to pursue appropriate opportunities if they arise or to take certain other actions that the Board may determine is in the Company’s Proxy Statementbest interests of the Company and formthe best interests of proxyour shareholders. However, at this time we have no plans, arrangements or understandings for any transactions that would involve the issuance of such additional authorized shares.