We are committed to strong corporate governance practices and to demonstrating responsiveness to our shareholders and their concerns. In light of the
shareholder proposal received from The Accountability Board, Inc. (“TAB”) set forth on page 85, which asks that we take the steps necessary so that any
voting requirement in our governing documents that calls for a greater than simple majority vote be replaced by a simple majority voting requirement, we
conducted a thorough evaluation of the various instances in which our governing documents contain these supermajority and other non-simple majority voting
requirements, which we refer to as “supermajority” voting requirements.
In evaluating the provisions in our governing documents that require a supermajority vote, we considered multiple factors, including the advantages and
disadvantages of supermajority voting requirements in general and in light of our overall corporate governance structure, and the fact that many investors and
other stakeholders view supermajority voting requirements as inconsistent with principles of good corporate governance on the basis that the requirement of a
supermajority vote can limit the ability of shareholders to effect change. Although we acknowledge that some corporations have eliminated supermajority
voting requirements in totality, we ultimately do not believe that a formulaic, one-size-fits-all approach is appropriate and that supermajority voting
requirements may be appropriate for certain provisions that have a fundamental impact on the Company.
After careful consideration, we believe that it is in the best interests of the Company and our shareholders to eliminate most, but not all, of these
supermajority voting requirements. We believe that it is important to our shareholders that certain fundamental changes should require the support of more
than a majority of the shares represented at a meeting and entitled to vote on the matter, as described below. A simple majority vote requirement can allow
action by less than a majority of our outstanding shares, or a few large shareholders, which may not be in the best interest of all of our shareholders. In
particular, we do not believe that the three following supermajority voting requirements in our governing documents should be reduced to a simple majority
voting requirement (collectively, the “Voting Exceptions”):
1. Changes to Board Structure: Article Five, Section D of our Amended and Restated Articles of Incorporation provides that Article Five (which
outlines requirements for any changes to the provisions governing the Board, including changes to the size of the Board, the term of office of the
directors, removal of any directors and filling any vacancies) may be amended, altered, changed or repealed only upon the affirmative vote of not
less than two-thirds of all of the outstanding shares of capital stock of the Company then entitled to vote generally in the election of directors
voting together as a single class; provided, however, that whenever the holders of shares of any class are entitled to elect one or more directors,
such amendment, alternation, change or repeal shall also require the affirmative vote of not less than two-thirds of the outstanding shares of each
such class entitled to vote at such meeting.
2. Changes to Director and Officer Indemnification: Article Ten, Section L of our Amended and Restated Articles of Incorporation provides that
Article Ten (which outlines the requirements for any changes to the provisions governing the indemnification of the Company’s directors and
officers) may be amended, altered, changed or repealed only upon the affirmative vote of not less than 85% of all of the outstanding shares of
capital stock of the Company then entitled to vote generally in the election of directors voting together as a single class.
3. Changes to Bylaws: Article V, Section 5 of our Amended and Restated Bylaws provides that the shareholders of the Company may amend, alter,
change or repeal any provision of the Amended and Restated Bylaws upon the affirmative vote of a majority of all of the outstanding shares of
capital stock of the Company entitled to vote thereon.
We view these Voting Exceptions as relating to fundamental elements of our corporate governance, and believe these supermajority voting requirements
are narrowly tailored to promote stability and provide our shareholders with meaningful protections against potentially self-interested actions proposed by one
or a few large shareholders who might attempt to prioritize their interests over those of the majority of our shareholders. For example, if the Voting Exceptions
are reduced to a simple majority voting requirement, these fundamental elements of our corporate governance could conceivably be amended by less than half
of our outstanding shares in situations of low voter turnout or significant abstentions. In an extreme case, it could only take 25.1% of our outstanding shares to
approve an amendment to these fundamental elements of our corporate governance, or as few as our four largest shareholders (as of November 25, 2024). As
such, if these Voting Exceptions are reduced to a simple majority voting requirement, a very small group of our shareholders who are not bound by a fiduciary
duty to act in the best interests of the Company and our shareholders would have the power to act in their own self-interests to the detriment of the Company
and our other shareholders. We believe amendments to these fundamental elements of our corporate governance should require the broad consensus of our
shareholders, rather than a simple majority of the shares represented at a meeting and entitled to vote on the matter.