PAYCHEX,INC. (NASDAQ:PAYX) Files An 8-K Other EventsITEM 8.01OTHER EVENTS
The following “Description of Common Stock” is filed for the purpose of updating the description of the common stock of Paychex, Inc. (“we,” “our,” “us,” or the “Company”).The “Description of Common Stock” modifies and supersedes any prior description of the common stock of the Company in any registration statement or report filed with the Securities and Exchange Commission (the “Commission”) and will be available for incorporation by reference into certain of the Company’s filings with the Commission to the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the rules and forms promulgated thereunder. Thissummary does not purport to be completeand is subject to, and is qualified in its entirety by express referenceto, the applicable provisions of the Company's restated certificate of incorporation, its bylaws, and Delaware General Corporation Law (“Delaware Law”).
DESCRIPTION OF COMMON STOCK
Authorized Capitalization
The Company is authorized to issue 600,000,000 shares of $0.01 par value common stock.
Dividend Rights
Holders of our common stock are entitled to receive ratably any dividends our board of directors (the “Board”) declares out of funds legally available for that purpose.
Voting Rights
Each share of our common stock entitles its holder to one vote on all matters to be voted upon by our stockholders. Our common stock has no cumulative voting rights.
No Pre-emptive or Other Rights
Our common stock has no preemptive rights, conversion rights, or other subscription rights or redemption or sinking fund provisions.
Right to Receive Liquidation Distributions
In the event of our liquidation, dissolution, or winding up, the holders of our common stock are entitled to share ratably in all assets remaining after payment of liabilities.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC in New York, New York.
Listing
Our common stock is listed on the NASDAQ Global Select Market under the symbol “PAYX.”
Anti-Takeover Provisions
Some provisions of Delaware law, our restated certificate of incorporation and our bylaws, as amended, may have the effect of delaying, deferring, or discouraging another party from acquiring control of us.
Delaware Law
We are subject to Section 203 of the Delaware General Corporation Law, which regulates, subject to some exceptions, acquisitions of publicly-held Delaware corporations. In general, Section 203 prohibits us from engaging in a “business combination” with an “interested stockholder” for a period of three years following the date the person becomes an interested stockholder, unless:
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our Board approved the business combination or the transaction in which the person became an interested stockholder prior to the date the person attained this status; |
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upon consummation of the transaction that resulted in the person becoming an interested stockholder, the person owned at least 85 percent of our voting stock outstanding at the time the transaction commenced (excluding specified shares); or |
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on or subsequent to the date the person became an interested stockholder, our Board approved the business combination and the stockholders authorized the transaction at an annual or special meeting of stockholders by the affirmative vote of at least 66 2/3 percent of the outstanding voting stock not owned by the interested stockholder. |
Section 203 defines a “business combination” to include:
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any merger or consolidation involving us or any of our majority-owned subsidiaries and the interested stockholder or any other entity if the merger or consolidation is caused by the interested stockholder; |
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any sale, lease, exchange, mortgage, transfer, pledge, or other disposition, except proportionately, involving the interested stockholder of our or one of our majority-owned subsidiary’s assets, which have an aggregate market value equal to 10% or more of either the aggregate market value of all our assets or the aggregate market value of all our outstanding stock; |
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in general, any transaction that results in the issuance or transfer by us or any of our majority-owned subsidiaries of any of our stock to the interested stockholder; |
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any transaction involving us or any of our majority-owned subsidiaries that has the effect of increasing the proportionate share of our stock owned by the interested stockholder; and |
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the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges, or other financial benefits provided by or through us or any of our majority-owned subsidiaries. |
In general, Section 203 defines an “interested stockholder” as any person who(i) owns 15% or more of our outstanding voting stock or (ii) is an affiliate or associate of us and was the owner of 15% or more of our outstanding voting stock at any time within three years prior to the dateof determination of interested stockholder status; and (iii)is the affiliate or associate of any such person.
Special Meetings
Special meetings of stockholders may be called by the Chairman of the Board or the President and must be called by the Chairman of the Board, the President, or the Secretary at the request in writing of a majority of the Board or stockholders owning a majority of our issued and outstanding stock entitled to vote.
Restated Certificate of Incorporation and Bylaw Provisions
Our restated certificate of incorporation and bylaws, as amended, provide that:
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our Board or our stockholders are expressly authorized to amend, alter or repeal our bylaws; and |
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we will indemnify officers and directors against losses they may incur arising from investigations and legal proceedings resulting from their services to us, which may include services in connection with takeover defense measures. |
About PAYCHEX,INC. (NASDAQ:PAYX)
Paychex, Inc. is a provider of integrated human capital management (HCM) solutions for payroll, human resource (HR), retirement and insurance services for small- to medium-sized businesses in the United States. The Company also has operations in Germany. The Company offers services, including Payroll processing, Human Resource Services, and Accounting and Financial Services. As of May 31, 2016, the Company serviced approximately 605,000 payroll clients. It offers a portfolio of HCM services and products that allows its clients to meet their payroll and HR needs. Its payroll-related ancillary services and human resource service (HRS) offerings often leverage the information gathered in the base payroll processing service, allowing it to provide outsourcing services covering the HCM spectrum. The Company, through its HCM software-as-a-service platform, Paychex Flex, provides an integrated product suite that covers the employee life cycle from recruiting and hiring to retirement.
