Acme United Corporation (ACU) Earnings Call Transcript & Summary

Good morning. I'm Walter C. Johnsen, Chairman and CEO. I'm pleased to welcome you to the Annual Meeting of Shareholders of Acme United Corporation. Paul Driscoll, our Chief Financial Officer and Secretary, will be leading the formal portion of the meeting. This will be followed by a question-and-answer period led by the management team. You are encouraged to ask questions, and we will do our best to respond to as many as possible. [Operator Instructions] Please remember that you may vote your shares online at any time during the meeting prior to the closing of the polls. The agenda for the meeting may be viewed through the web portal. I'll now turn the meeting to Paul.

Thank you, Walter. Welcome, everyone, to this virtual annual meeting. I hereby call the meeting to order. First, I would like to introduce our Board of Directors, all of whom are in attendance. Rex Davidson, Richmond Holden, Walter Johnsen, Brian Olschan, who also is Acme's President; Stevenson Ward, Susan Murphy and Brian Barker. Also present is Scott Torreso, Acme's Corporate Controller, as Inspector of Election. Mr. Torreso has taken the oath of inspector of election earlier today. I would also like to introduce the representative of our independent auditors, Kevin Cole of Marcum LLP who will be available along with management to answer questions following the business portion of the meeting. I also introduced our SEC and Corporate Counsel, Merritt Cole of Earp Cohn PC. After we have finished with the formal portion of the meeting, we will provide time for general questions. Only validated shareholders may ask questions in the designated field on the web portal. Any shareholder who has not yet voted and wishes to vote or to change their vote should do so now by clicking on the voting button on the web portal and following the instructions there. Shareholders who have sent in proxies are voted via the Internet and do not want to change their vote do not need to take any further action. The Board of Directors fixed the close of business on March 4, 2021, as the record date for determining stockholders entitled to vote at this meeting. The stockholder list shows that as of the record date, there were 3,342,210 shares of common stock outstanding and entitled to vote at this meeting. I have received an affidavit of mailing establishing that notice of this meeting was duly given on or about April 2, 2021, to shareholders of record at the close of business on March 4, 2021. A copy of the notice of meeting and the affidavit of mailing will be included in the minutes of this meeting. The inspector informed me that at this meeting, they are present, in person and by proxy, the holders in excess of 50% of the voting securities of the corporation issued and outstanding on March 4, 2021. This constitutes a quorum, and the meeting is legally constituted. I have the minutes of the last annual meeting held on April 20, 2020, and ask that someone make a motion to dispense with the reading of the minutes. I have received a motion to dispense with the reading of the minutes. Now I will present the matters to be voted upon. Please note that we will give stockholders an opportunity to comment on the proposals themselves after all proposals have been presented. Proposal 1 is the election of 7 directors. The current Board of Directors has nominated each of our incumbent directors, Rex Davidson, Richmond Holden, Walter Johnsen, Brian Olschan, Stevenson Ward, Susan Murphy and Brian Barker for election as directors of the company to serve until the next Annual Meeting of Shareholders or until their successors are elected and qualified. Our bylaws require shareholder wishing to make a nomination for a director to give advance notice of any such nomination to the company, not having received advanced notice of any other nomination, there can be no further nominations made at this meeting. Proposal 2 is to approve an amendment to the company's 2012 employee stock option plan. As more fully described in this year's proxy statement, the amendment to the 2012 employee stock option plan will increase the number of shares authorized to be issued under the plan from 1.380 million to 1.580 million, an increase of 200,000 shares. Proposal 3 commonly referred to as the say-on-pay proposal is to approve on a nonbinding advisory basis, the 2020 compensation of our named elective officers as described in the proxy statement compensation. Lastly, Proposal 4 is to ratify the appointment of our independent registered accounting firm, Marcum LLP for the fiscal year ending December 31, 2021. Now that everyone has had the opportunity to vote, I now declare the polls for the 2021 Acme United Corporation Annual Meeting of Shareholders closed.

Mr. Torreso, do we have preliminary voting results?

We do. I hereby report that proposal 1, each of the 7 nominees for election to the Board of Directors has been duly elected by shareholders representing more than a plurality of the votes cast at the meeting. Proposal 2 to amend the 2012 employee stock option plan to increase the number of shares authorized for issuance under the plan has been approved by more than a majority of the votes cast at the meeting. Proposal 3, to adopt a nonbinding resolution to approve the compensation of our named executive officers has been approved by more than a majority of the votes cast at the meeting. Proposal 4, to ratify the appointment of Marcum LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2021, has been approved by more than a majority of the votes cast at the meeting.

Thank you, Mr. Torreso. If any shareholder would like to ask a question on any of the proposals and has not yet done so, please submit your -- through the web portal.

Now I would like to open things for shareholder questions. As Mr. Driscoll previously indicated, only validated shareholders may ask questions in the designated field on the web portal.

We will now pause to assemble the Q&A.

There have been no questions. There being no further business to come before the meeting, I will entertain a motion to adjourn. I've received a motion to adjourn the meeting. Thank you for attendance to the annual meeting, the Acme United Corporation 2021 Annual Meeting is now adjourned.