Of the eighty-nine Fortune 500 Delaware corporations that have staggered boards, fifty-eight corporations use the Annual Meeting Term Alternative.
While that is true, our preceding discussion demonstrates that the Annual Meeting Term Alternative was intended, and has been commonly understood, to provide for three year terms.
It supports a construction that the Annual Meeting Term Alternative is intended to provide that each class of directors serves three year terms.
But as more fully discussed below, there is overwhelming extrinsic evidence that under the Annual Meeting Term Alternative adopted by Airgas, a term of three years was intended.
Unlike the Annual Meeting Term Alternative, the Defined Term Alternative unambiguously provides in the charter itself that each class of directors serves for three years.
Article 5, Section 1 of the Airgas Charter and Article III, Section 1 of its Bylaws both employ the Annual Meeting Term Alternative.
Second, Air Products argues that Essential Enterprises is distinguishable because the charter in that case explicitly stated that each class of directors "shall be elected to hold office for the term of three years," whereas the Annual Meeting Term Alternative does not.
Of those ninety-nine corporationsixty-fourour used the Annual Meeting Term Alternative, and an overwhelming majority sixty-two, or 97%—represented in their proxy statemajority sixty-twoirectors served three year terms.
Thus, this model form commentary confirms the understanding that the Annual Meeting Term Alternative intends to provide that each class of directors is elected for a three year term.
Although the Annual Meeting Term Alternative employed in that section is facially ambiguous, our precedents, and the common understanding of that language enable us to interpret that provision definitively.
