DESCRIPTION OF COMMON STOCK
The following is a summary of the general terms of the Company’s common stock. This description is not complete and is subject to, and qualified in its entirety by reference to, the Maryland General Corporation Law and our Charter and Bylaws, copies of which are exhibits to the registration statement of which this prospectus is a part. See “Where You Can Find More Information” and “Incorporation of Certain Documents by Reference.”
As of June 30, 2018, the total number of shares of stock of all classes which the Company has authority to issue is 1,000,000,000 shares (par value $.0001 per share), consisting of 670,000,000 shares of common stock and 330,000,000 shares of excess stock.
As of July 31, 2018, there were 66,050,101 shares of common stock outstanding. Also, as of June 30, 2018, under the Essex Property Trust, Inc. 2013 Stock Award and Incentive Compensation Plan (the “2013 Plan”), there were options outstanding to acquire 522,827 shares of common stock. Effective as of May 15, 2018, the Company’s stockholders approved the Essex Property Trust, Inc. 2018 Stock Award and Incentive Compensation Plan (the “2018 Plan”). The maximum aggregate number of shares of common stock that may be issued under the 2018 Plan is 2,000,000, plus the number of shares authorized for grants and available for issuance under the 2013 Plan as of the effective date of the 2018 Plan and the number of shares subject to outstanding awards under the 2013 Plan that are forfeited or otherwise not issued under such awards. No further awards will be granted under the 2013 Plan and the shares that remained available for future issuance under the 2013 Plan as of May 15, 2018, the date of the Company’s 2018 Annual Meeting of Stockholders, will be available for issuance under the 2018 Plan. As of June 30, 2018, under the 2018 Plan, there were options outstanding to acquire 12,962 shares of common stock.
As of June 30, 2018, an aggregate of 2,145,653 shares of common stock may be issued upon the conversion of limited partnership interests in the Operating Partnership and an additional 127,330 shares of common stock would be issuable in exchange for outstanding Long Term Incentive Plan (“LTIP”) units and other outstanding incentive compensation units in the Operating Partnership, subject to meeting certain requirements. In addition, as of June 30, 2018, certain partners in limited partnerships in which the Operating Partnership has invested had the right to have their limited partnership interests in such partnership(s) redeemed for cash or, at our option, subject to certain restrictions, for an aggregate of 917,593 shares of common stock.
The following description of the common stock sets forth certain general terms and provisions of the common stock. This description is in all respects subject to and qualified in its entirety by reference to the applicable provisions of Essex’s Charter and Bylaws and the Maryland General Corporation Law. The common stock is listed on the NYSE under the symbol “ESS.” Computershare Trust Company, N.A. is Essex’s transfer agent.
Under Maryland law, stockholders generally are not personally liable for the Company’s debts or obligations solely as a result of their status as stockholders. The holders of the outstanding shares of common stock are entitled to one vote per share on all matters voted on by stockholders, including the election of directors. The Charter provides that shares of common stock do not have cumulative voting rights.
Our Charter authorizes the Board of Directors of Essex (the “Board of Directors”), without stockholder approval, to reclassify any unissued shares of our common stock into other classes or series of stock, to establish the designation and number of shares of each such class or series and to set, subject to the provisions of our Charter regarding the restrictions on ownership and transfer of our stock, the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of each such class or series.
The shares of common stock offered hereby will be fully paid and nonassessable and will not be subject to preemptive or similar rights. Subject to the preferential rights of any outstanding class or series of capital stock, the holders of common stock are entitled to such distributions as may be authorized from time to time by the Board of Directors and declared by Essex from funds available for distribution to such holders. Essex currently pays regular quarterly dividends to holders of common stock out of funds legally available for distribution when, and if, authorized by the Board of Directors and declared by Essex.