AIRGAS, INC. v. AIR PRODUCTS CHEMICALS, 5817-CC (Del.Ch. 10-8-2010)

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#p1021844 A.2d 1015, 1021 (Del. Ch. 2003)).

Pls.' Opening Br. 5, 22.

Defendant agrees that the "full term" of the class of Airgas directors up for reelection in 2011 will expire at Airgas's 2011 annual meeting of stockholders. The question is the same one asked in the previous sections of this Opinion when evaluating whether the bylaw conflicted with Airgas's charter and bylaw provisions: when can that "annual" meeting validly take place? Defendant points to the identical language of DGCL Sections 211(b) and 211(c) relied on by plaintiffs to support its own opposing position that there is "[n]othing in the statutes or in Airgas's charter establish[ing] a minimum interval between a company's annual meetings." Instead, defendant argues that this is simply a case about entrenchment; about the Airgas board wanting this Court to "plug the hole" in a vulnerability in its takeover defenses (namely, its staggered board) and to undo the result of a shareholder vote that the Airgas board lost fair and square.

Def.'s Letter to the Court (Aug. 30, 2010), at 2.

Def.'s Opening Br. 1.

Defendant counters plaintiffs' argument regarding the policy of DGCL Section 211 by suggesting instead that the purpose of that Section is "to ensure that directors remain accountable to their shareholders" by prohibiting them from going more than thirteen months without an annual meeting; not less. Accordingly, defendant contends that Airgas's interval of approximately one year is merely "implied" — it is a fiction.

Def.'s Opening Br. 17.

As far as Sections 141(d) and 141(k), defendant argues that Section 211 is the statute governing the timing of annual meetings, and so that is where any "overriding rule for the timing of annual meetings" would be found in the DGCL. Defendant maintains that "[n]othing in [DGCL] § 211(c), or anywhere else in the DGCL, specifies that any particular interval between meetings is too short." B. Analysis

Def.'s Reply Br. 12.

Def.'s Opening Br. 15.

First, plaintiffs have seemingly abandoned their "removal" argument, given that they did not once mention 141(k) in their answering brief, but I will address the applicability of Section 141(k) here nonetheless. Plaintiffs argue that by cutting short the "full term" of the directors' up for election at the 2011 annual meeting, the bylaw constitutes an improper removal under Section 141(k)(1), as it is both without cause and without 67% of the vote of Airgas's stockholders as required for removal under Airgas's charter. Defendant responds that there is no removal problem "because the Airgas directors are not being `removed'." In order for plaintiffs' argument to hold water, the bylaw would have to be found to "cut short" the "full term" of the directors; otherwise defendant is correct that the Airgas directors are not being "removed" (i.e. unseated before the end of their term) and thus the "removal" statute is not implicated. As discussed more fully below, there is no removal problem here — the "full term" of these directors expires at the "annual meeting" to be held in 2011. Under the statutory framework of the DGCL, "absent a specific charter or bylaw provision classifying a board, the term of office of each director is coextensive with the period between annual meetings." Airgas has a charter and bylaw provision classifying the board, but it does not unambiguously define what is meant by a "full term" or when the "annual meeting" must take place. Thus, on Airgas's classified board, the directors whose terms expire at the next election will have served a "full term" at the 2011 "annual meeting," regardless of whether that meeting takes place earlier in the year or later in the year. The fact is that the directors' term "expires" at the "annual meeting," whatever date it is held. Section 141(k) is inapposite here. Plaintiffs' only "removal" argument remaining suggests, therefore, that the Air Products bylaw "accomplishes" a removal by "evad[ing] the 67% removal requirement" in Airgas's charter by "permit[ting] shareholders to remove directors before their terms have expired" by a simple majority vote. While it is true that under Airgas's charter, 33% of the stockholders could call a special meeting to remove the directors by a 67% supermajority vote, that provision governs "removal" of directors and is a separate and distinct issue from the question of what constitutes a "full term" under Airgas's charter. Because under Airgas's charter, the directors' "full term" expires at the 2011 "annual meeting," there is no removal problem.

See Pls.' Opening Br. 4, 15, 16, 31-32 38-41.

Def.'s Opening Br. 25.

See, e.g., Crown EMAK Partners, LLC v. Kurz, 992 A.2d 377, 401 (Del. 2010) ("The election of successors takes place at an annual meeting," whereas removal of directors takes place "between annual meetings").

Id. at 401 (quoting 1 David A. Drexler et al., Delaware Corporation Law and Practice § 13.01[3], at 13-6 (2009)).

Pls.' Reply Br. 25.

Moreover, under the doctrine of independent legal significance, an action that is validly taken under one section of the DGCL has legal independence from an action that might have been taken under another section of the statute, even if the actions lead to the same result. Orzeck v. Englehart, 195 A.2d 375, 377 (Del. 1963) ("[T]he uniform interpretation given the Delaware Corporation Law over the years [is] that action taken in accordance with different sections of that law are acts of independent legal significance even though the end result may be the same under different sections. The mere fact that the result of actions taken under one section may be the same as the result of action taken under another section does not require that the legality of the result must be tested by the requirements of the second section."); see also Warner Commc'ns Inc. v. Chris-Craft Indus., Inc., 583 A.2d 962, 970 (Del. Ch. 1989).

DGCL Section 211 is entitled "Meetings of stockholders." As noted above, Section 211(b), provides that "an annual meeting of stockholders shall be held for the election of directors on a date and at a time designated by or in the manner provided by the bylaws." "Annual meeting" is not defined. Corporations are free to draft their governing documents to specify when their annual meetings shall take place. They can do this explicitly in the bylaws. They can also explicitly define the terms of their staggered board in their charter or bylaws, should they decide to have a classified board. To the extent that they do not unambiguously make these terms clear in their governing documents, though, the default rules in Delaware do not require waiting a "year," or "twelve months" or any set amount of time from one annual meeting to the next.

8 Del. C. § 211.

8 Del. C. § 211(b).

Plaintiffs contend that, although not defined in the DGCL, the common sense reading of "annual meeting" means at least (or approximately) one year apart. That gloss is nowhere to be found in the statute, though. Undefined words in statutes are given their "ordinary, common" meaning. A literal reading of "annual meeting" means a meeting that will take place once a year. "Annual meeting" is a statutory term with an obvious legal import — it refers to the obligatory stockholder meeting that must occur, by law, once every year. There is no requirement that it be spaced by eleven or twelve months, but just that it happen once a year, every year.

Dewey Beach Enters., Inc. v. Bd. of Adjustment, 2010 WL 2977928, at *2 (Del. July 30, 2010).

The numerous dictionary definitions cited by both plaintiffs and defendant (dubbed a form of "dictionary abuse" at oral argument) support this reading. See MERRIAM-WEBSTER DICTIONARY (online edition) (defining "annual" as "covering the period of a year" or "occurring or happening every year or once a year"); see also WEBSTER'S THIRD NEW INT'L DICTIONARY 88 (Philip Babcock Gove ed. 2002) (defining "annual" as "reckoned by the year," "covering the period of a year: based on a year" or "occurring, appearing, made, done, or acted upon every year or once a year"); AMERICAN HERITAGE COLLEGE DICTIONARY 1587 (4th ed. 2010) (defining "annual" as "[h]appening every year; yearly" or "a period of approximately the duration of a calendar year"); 1 OXFORD ENGLISH DICTIONARY (J.A. Simpson E.S.C. Weiner eds., 2d ed. 1989) (defining "annual" as "[p]erformed or recurring once every year; yearly").

Section 211(c), in turn, sets limits on the timing of annual meetings in two ways: (1) if an annual meeting date is designated, the meeting must be held within 30 days of that date, and (2) annual meetings cannot be separated by greater than thirteen months — that is, Section 211(c) explicitly prohibits holding the annual meeting later than thirteen months after the last annual meeting. But the statute does not explicitly prohibit the annual meeting interval from being shortened by any amount of time. Put differently, it does not prohibit holding the annual meeting earlier than a year after the previous annual meeting. So, while Section 211 may provide one month wiggle room after a year has passed to hold the annual meeting, the DGCL is silent as to the amount of "leeway" in the opposite direction. A logical reading of the statute thus leads to the conclusion that, under the default rule, the annual meeting date cannot be held later than thirteen months from the last annual meeting, but it can be moved up by any amount of time (so long as notice requirements are met, it does not conflict with the charter and bylaws, etc.). If the General Assembly had meant to prohibit the latter, it would have explicitly said so as it did with the former.

There are practical constraints that would prevent one annual meeting from being held too close to the next. For example, if Air Products' bylaw is adopted, two meetings could not be held, as plaintiffs suggest they might, "in four weeks, four days, or even four minutes" or "on December 31, 2010, and [then] on January 1, 2011 — one day later." Pls.' Opening Br. 5-6; Pls.' Reply Br. 2. Notice requirements would not allow for that (the latter three suggestions, at least, would explicitly violate Airgas's charter which has an advance notice requirement of no less than ten days before an annual meeting may be held). Similarly, filing obligations ( e.g., proxy statements must be filed with the SEC before an annual meeting may be held) would be difficult, if not impossible, to comply with in that timeframe. And the Air Products bylaw does not contemplate such absurd results — the annual meeting would simply be held in January of each year.

The legislative history of the DGCL supports this reading. The requirement to hold a stockholder meeting "annually" was added to Section 211 because "[a]lthough the legal requirement of annual meetings to elect directors is ingrained in Delaware cases, the statute should specifically say so." Folk Report 110, available at http://law.widener.edu/LawLibrary/Research/ OnlineResources/DelawareResources/~/me dia/Files/lawlibrary/corporations/folkreportpt2.ashx (citing Standard Power Light Corp. v. Inv. Assocs., 51 A.2d 572 (Del. 1947). In Standard Power Light Corp., the Delaware Supreme Court held that "`[t]he statute of this state under which the corporation was created provides that directors shall be elected at an annual meeting of stockholders. The duty to hold such a meeting and to elect directors thereat is one that is laid by the statute . . . Reasonable rules ought to prevail in aid of the accomplishment of the statute's purposes, and a certain degree of liberality in favor of a meeting ought to prevail.'" 51 A.2d at 577 (quoting Duffy v. Loft, Inc., 151 A. 223, 227, aff'd, 152 A. 849). DGCL Section 224, whose content was transferred to Section 211(c), addressed the failure to timely hold a meeting. The Folk Report refers to that Section as Delaware's "exclusive method for dealing with refusals to summon annual meetings." Folk Report 113. The intent of the drafters of Section 211 was thus to require a meeting to take place once a year — if a corporation failed to hold a meeting for an extended period of time, a deadline of either thirty days after a meeting date was designated or thirteen months after the last annual meeting would ensure that a corporation would not go too long without holding an annual meeting. The leading treatises on Delaware law are in accord with this view of Section 211. In the section entitled "Time of annual meeting," Folk on the Delaware General Corporation Law explains that "[t]he date for the annual meeting is determined `by or in the manner provided in the by-laws' . . . A corporation may amend its bylaws to advance the annual meeting date unless such change is for an inequitable purpose." 1 Welch, Turezyn Saunders, Folk on the Delaware General Corporation Law § 211.5, at 15 (citing 8 Del. C. § 211(b); Lenahan v. Nat'l Computer Analysts Corp., 310 A.2d 661, 663 (Del. Ch. 1973)) (emphasis added). In Lenahan, a case where the fixing of the date of the annual meeting of stockholders was done in compliance with the company's bylaws, then-Vice Chancellor Marvel held that "advancing such [a] meeting date [] is permitted under the terms of the Delaware Corporation Law, 8 Del. C. § 211, unless such change is for an inequitable purpose." 310 A.2d at 663 (citing Schnell).

Moreover, the policy behind Section 211 reflects Delaware's "concern for corporate democracy." By prohibiting corporations from waiting longer than thirteen months between meetings, the statute is aimed at preventing board entrenchment by ensuring that stockholders have an opportunity to have their voices heard and to hold directors accountable. This thirteen-month period also limits gamesmanship by insurgents. That is, insurgents who make a tactical decision to move an annual meeting forward in the year do not have unlimited authority to keep changing the dates as it suits them. As it stands, the bylaw as written moves Airgas's meeting for all years until amendment to January. Thus, if insurgents move up a meeting (as here), they will face stockholders, if elected, within thirteen months. The Air Products nominees who were elected to Airgas's board at the September 15, 2010 meeting will face stockholders at a meeting in January 2012, rather than July 2012. If, once in office, the insurgents engage in musical meeting games advancing or delaying meetings for entrenchment, disenfranchisement, or other improper purposes, this Court's broad equitable powers would have bite, as would the thirteen month limit under Section 211(c). Equity stands ready to thwart misuse or abuse by directors or by insurgents.

See Blasius Indus., Inc. v. Atlas Corp., 564 A.2d 651, 660 (Del. Ch. 1988).

See MM Cos., Inc. v. Liquid Audio, Inc., 813 A.2d 1118, 1127 (Del. 2003) ("Maintaining a proper balance in the allocation of power between the stockholders' right to elect directors and the board of directors' right to manage the corporation is dependent upon the stockholders' unimpeded right to vote effectively in an election of directors. . . . [The Delaware Supreme] Court and the Court of Chancery have remained assiduous in carefully reviewing any board actions designed to interfere with or impede the effective exercise of corporate democracy by shareholders, especially in an election of directors.") (citing Unitrin, Inc. v. Am. Gen. Corp., 651 A.2d 1361, 1378 (Del. 1995); Blasius Indus., Inc. v. Atlas Corp., 564 A.2d 651, 659-61 (Del. Ch. 1988); In re Gaylord Container Corp. S'holders Litig., 753 A.2d 462 (Del. Ch. 2000)).

See Schnell v. Chris-Craft Indus., Inc., 285 A.2d 437, 439 (Del. 1971) (holding that attempts by a board to "utilize the corporate machinery and the Delaware Law for the purpose of perpetuating itself in office [and] for the purpose of obstructing the legitimate efforts of dissident stockholders in the exercise of their rights to undertake a proxy contest against management [] are inequitable purposes, contrary to established principles of corporate democracy."). Thus, in Schnell, the Court held that the advancement by directors of a bylaw date of a stockholders' meeting was not permitted to stand for inequitable purposes. A court of equity has jurisdiction over corporate cases to make sure that fiduciaries don't abuse their trust; not to protect fiduciaries. Absent a clear statutory or contractual right to a full year's (or three years') service, there exists no animating principle under which I would strike down the January annual meeting bylaw. Indeed, plaintiffs suggest that "there is no need [for this Court] to decide here how far short of twelve months is too short" — only that four months is not long enough. But under plaintiffs' definition of "annual," just how far short of twelve months would be too short? If annual meetings are to be held "approximately every twelve months," must amendments to annual meeting dates always go forward and never backwards? Pls.' Reply Br. 20. If not, would an amendment to move the annual meeting back by one or two months be okay, but three months would not (i.e., only a "material shortening" is prohibited)? There is no basis in the DGCL or in our common law for such a ruling. To hold in favor of the target (plaintiffs) would require twisting the Schnell doctrine against stockholders to protect directors who have no clear right — statutory or contractual — to serve 365 days.

Having found that the bylaw does not conflict with the plain meaning of "annual meeting" under DGCL Section 211, I conclude that the bylaw consequently does not conflict with Section 141(d), as it does not change the meaning of a "full term" on a classified board. In order to interpret the legal meaning of Sections 211 and 141(d) of the DGCL this Court will, "to the maximum extent feasible, [interpret these two Sections in a way that] gives full effect to the literal terms of the language of each."

Hoschett v. TSI Int'l Software, Ltd., 683 A.2d 43, 44 (Del. Ch. 1996).

Section 141(d), as noted above, contains the following language authorizing corporations to adopt a staggered board:

The directors of any corporation organized under this chapter may . . . be divided into 1, 2 or 3 classes; the term of office of those of the first class to expire at the first annual meeting held after such classification becomes effective; of the second class 1 year thereafter; of the third class 2 years thereafter; and at each annual election held after such classification becomes effective, directors shall be chosen for a full term, as the case may be, to succeed those whose terms expire.

Plaintiffs contend that "[t]he statute's reference to `1 year' and `2 years' reflects a simple proposition: that the `annual elections' or `annual meetings' are things that occur approximately one year apart." But simply because the statute refers to "years" to separate the initial two "annual meetings" in which classification becomes effective, does not automatically mean that "annual meeting" equals "approximately one year apart" — had the General Assembly wanted to say that, it would have.

Pls.' Reply Br. 9.

As support for their position, plaintiffs also cite to Essential Enterprises Corp. v. Automatic Steel Prods., Inc. for the proposition that "[c]learly the `full term' visualized by the statute is a period of three years — not up to three years." But what that case holds is that DGCL Section 141(d) "says that `directors shall be chosen for a full term.' The certificate implements this." The certificate at issue in Essential Enterprises called for a staggered board with the following terms:

159 A.2d 288, 291 (Del. Ch. 1960).

Id. at 290.

[After the initial classes had been established,] [a]t each annual election, commencing at the next annual meeting of the stockholders, the successors to the class of directors whose term expires in that year shall be elected to hold office for the term of three years to succeed those whose term expires so that the term of office of one class of directors shall expire in each year.

The charter in Essential Enterprises explicitly called for three-year terms; Airgas's charter does not. Thus, the "full term" specified by the charter in Essential Enterprises was three years. The "full term" visualized by the statute based on Airgas's charter is until "the annual meeting of stockholders held in the third year following the year of their election. Plaintiffs argue that "[t]he word `annual' must mean one thing, and one thing only, for all purposes throughout the statute." I agree, and my holding here gives the word annual a single, consistent meaning throughout the statute. My holding does not give "annual" more than one meaning — whether it is an "annual election" or an "annual meeting," it occurs once a year, every year. But there is no statutory requirement that there be a durational minimum amount of time between annual elections or annual meetings, unless it is so specified in a company's bylaws or charter.

Certificate, art. 5, § 1.

Pls.' Reply Br. 3.

Plaintiffs' counsel at oral argument forcefully contended that the language "shall be elected to hold office for three years" is functionally equivalent (X=Y) to the phrase that appears in Airgas's charter and bylaws (as well as in many other Delaware corporations' charters and bylaws). That is, counsel insisted that the locution "shall be elected to hold office for three years" is equivalent to (means the very same as) the locution that directors "shall hold office for a term expiring at the annual meeting . . . held in the third year following the year of their election." But this equation will not solve — X does not equal Y for the simple reason they are different letters in the alphabet and the words each serve as a proxy for are different linguistic formulations that have a different meaning in standard English usage. If these linguistic formulations appear in ten thousand company charters, the words will nonetheless have the meaning I believe they must be read to have here. To read them in the manner plaintiff urges is, in my opinion, contrary to a common sense interpretation of the words. In addition, to read them in this non-literal fashion would be to read them contrary to the reading more favorable to the stockholder franchise. And so, despite the skillful advocacy of plaintiff's counsel, I am unable to accept the proposition that X=Y in these circumstances.

Other cases cited by the parties are easily distinguishable. Roven v. Cotter involved a charter amendment that would declassify a staggered board so that a director could then be immediately removed with or without cause (because under the company in question's charter, classified directors could not be removed without cause). Thus, it was clearly a "removal" case and did not address the question of when in the year an "annual meeting" must be held, but it is instructive nonetheless. There, Citadel Holding's charter contained a staggered board provision with language similar to Airgas's charter (i.e. directors' terms expire at the "third annual meeting of the stockholders following said Director's election"). Plaintiff Roven argued that "sections 141(d) and 141(k), when taken together, entitle a director elected in accordance with § 141(d) to serve a `full term' of three years." The Court rejected that argument, however, holding that Section 141(d) "could not possibly entitle a director to serve a `full term' contrary to basic principles of corporate democracy, and the expressed will of the majority." Dolgoff v. Projectavision, Inc. is the only case cited by the parties in which the Court expressly considered the question of whether a corporation could hold its "annual meeting" earlier in the year than it was historically held. This case is distinguishable, first, because the directors in Dolgoff had a defined term of office, unlike Airgas. Moreover, there was no claim that holding the annual meeting earlier in the year violated some statutory or charter provision. Instead, Mr. Dolgoff argued that holding the meeting earlier in the year was an inequitable manipulation of the electoral process under Schnell and Blasius. The case thus is inapplicable to this case.

Roven v. Cotter, 547 A.2d 603 (Del. Ch. 1988).

Id. at 604.

Id. at 607.

Id. at 608.

1996 WL 91945 (Del. Ch. Feb. 29, 1996).

Id. at *3 n. 9 (Projectavision's charter provided: "At the expiration of the initial term, and of each succeeding term of each class, the directors of each class shall be elected to serve for a three year term.") (emphasis added).

Indeed, Projectavision had not held an annual meeting in over a year. Id. at *2.

Id. at *5. Although the bylaw proponent in this case (Air Products) certainly had strategic aims in mind when it proposed moving the annual meeting forward to January 18, 2011, there is no allegation that those aims were inequitable or otherwise inappropriate. That is, plaintiff has not asserted equitable arguments against the adoption of the bylaw; it has not accused defendant of seeking to advance the date of the 2011 annual meeting in order to entrench board members or to thwart the exercise of the stockholder franchise — arguments typically encountered when directors are seeking to advance (or postpone) an annual meeting. The holding of the 2011 annual Airgas stockholder meeting may result in certain Airgas board members being replaced by successors, but that will only occur if it is the will of a majority of stockholders who vote at the 2011 annual meeting.

Ultimately, the policy arguments comport with this conclusion as well. First, the "Delaware General Corporation Law is an enabling statute that provides great flexibility," and so the Court will read it that way. DGCL Section 211 broadly enables corporations to define for themselves when their annual meetings shall be held. The DGCL does not define the term "annual meeting," and I will not read a specific definition into what is clearly an enabling provision. Directors and stockholders are free to specify when the annual meeting shall occur, and they are free to change it as they see fit, so long as they do not violate the limitations that do appear in the statute (the 30 day and 13 month constraints). Plaintiffs' argument relies most heavily on the impact that the word "annual" has on Section 141(d) — that is, on the "full term" of a director serving on a staggered board. Not all companies have classified boards, and the term "annual meeting" must mean the same thing for companies both with and without classified boards. The meaning of "annual" should be gleaned from the section of the DGCL (211) discussing "annual meetings"; not the section (141) authorizing classified boards.

Shintom Co. v. Audiovox Corp., 888 A.2d 225, 227 (Del. 2005).

See 8 Del. C. § 211(c).

Second, plaintiffs suggest that the common practice and understanding of staggered boards is that a "full term" is three years, and a conclusion that two "annual meetings" can be held in a four-month period would "destabilize the staggered boards of Delaware companies." This is not the case — it will not diminish the effectiveness of staggered boards. The common sense, ordinary language reading that an "annual meeting" must happen once every year comports with the clear terms of our statute, its policy rationale and our common law decisions. If corporate charters and bylaws have been written in a non-specific, open-ended fashion, it is not for this Court to twist their plain words to achieve a purported intent of the drafters. The solution is for drafters to employ clear and simple language to provide clarity and avoid ambiguity. This could easily be accomplished by corporate planners and draftsmen through such simple language as: "The annual shareholder meeting shall be held as closely as practicable in the same month of each year so as to ensure that the terms of office of directors shall approximate a complete year in length." In short, this is not the end of the world for staggered boards; it is an easy fix if it needs fixing.

Pls.' Reply Br. 4. Plaintiffs make much of this idea that two meetings in four months cannot be "annual." Ironically, until April 2010, Airgas's bylaws provided for annual meetings to be held anytime within a five-month window following Airgas's fiscal year — that is, the meeting could be held anytime from April to August. See Airgas Bylaws (amended through October 9, 2007), art. II, § 1 ("The annual meeting of the stockholders for the election of Directors and for the transaction of such other business as may properly come before the meeting shall be held on such date within five (5) months after the end of the fiscal year of the Corporation as the Board of Directors shall each year fix."). In April 2010, Airgas amended its bylaws so that its directors could set the annual meeting date at any time and pushed back its annual meeting to September in response to Air Products' hostile threat. See Airgas Bylaws (amended through April 7, 2010), art. II, § 1 ("Each annual meeting of the stockholders for the election of Directors and for the transaction of such other business as may properly come before the meeting shall be held on such date as the Board of Directors shall fix."). Had Airgas held its annual meeting earlier in the year as its old bylaws allowed, the January meeting could have actually taken place nine months later than the 2010 annual meeting.

See Frankino v. Gleason, 1999 WL 1032773, at *4 (Del. Ch. Nov. 5, 1999) (a corporation "is accountable to the provisions in its very own bylaws"), aff'd sub nom., McNamera v. Frankino, 744 A.2d 988 (Del. 1999).

VI. CONCLUSION

Delaware law prescribes no minimum amount of time that must elapse between annual stockholder meetings of a Delaware corporation. Section 211 of the DGCL prescribes only the maximum amount of time that may elapse between annual stockholder meetings (thirteen months). Delaware law thus affords companies flexibility to schedule annual meetings based on the particularized needs and circumstances of the corporation. A Delaware corporation may, of course, specify in its charter or bylaws a certain date or a certain time period of a year for its annual stockholder meeting. In the absence of a specified date or time period for the meeting, directors or stockholders of the corporation (as authorized) may choose a particular date for a given annual meeting. In this case, the stockholders of Airgas at its September 15, 2010 annual meeting voted to amend the company's bylaws to establish a particular period of the year (January) for the 2011 meeting and for all future annual stockholder meetings. This particular exercise of authority does not conflict with any other express provision of Airgas's bylaws or charter; nor does it conflict with any Delaware statute or with any common law decision. Airgas has no provision in its charter or its bylaws that defines a precise term of office for the members of its classified board of directors; instead, its bylaws and charter provide that the terms of its classified board of directors shall expire at the annual meeting in the third year following their year of election. This means that the current class (the class elected in 2008) of Airgas directors' terms of office shall expire at the annual meeting set in the third year after their election, or 2011. Thus, the bylaw adopted at the September 15, 2010 annual meeting setting the next annual meeting for January 18, 2011, shall be the annual meeting at which the 2008 class of directors will stand for election. If Airgas (or any other Delaware corporation) desires a "North Star" — an invariable, determinate and fixed term of office — for its directors, it must craft its charter or bylaws to specify that a director's term shall be for a defined period of time (e.g., a three year term, or a term not less than 35 months, or some other durationally defined minimum). The Court of Chancery is not charged with the duty to reform the actual words used in charters or bylaws so as to make them conform to expectations, purposes or intentions.

For the foregoing reasons, I have concluded that (1) Air Products' proposed bylaw amends Article II of Airgas's bylaws and is not "inconsistent" with Article III and, thus, a majority vote was sufficient to validly adopt the bylaw at the September 15, 2010 annual meeting, (2) the bylaw does not conflict with the terms of Airgas's charter, and (3) the bylaw is valid under Delaware law.

An Order implementing this Opinion has been entered.