cbdMD, Inc. (YCBD) Earnings Call Transcript & Summary

Good day. Welcome to the 2020 cbdMD Annual Meeting of Shareholders. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to your host, Mr. Martin Sumichrast. Martin, please go ahead.

Thank you. Good afternoon, ladies and gentlemen. I'd like to welcome you to the 2020 Annual Meeting of Shareholders of cbdMD, Inc. It's now 1:00 p.m. Will the meeting please come to order? I'm Martin Sumichrast, Chairman of the Board of Directors and Co-Chief Executive Officer of cbdMD, and I will serve as Chairman of the Meeting. Brian Pearlman, our SEC Counsel, will serve as Secretary of this meeting. Due to the emerging public health impact of COVID-19 pandemic and the stay-at-home order issued by the governor of the State of North Carolina where cbdMD's offices are located and to support the health and well-being of our employees, shareholders and partners, this year's Annual Meeting of Shareholders is being held in a virtual meeting format. We look forward to seeing everyone in person in our 2021 Annual Meeting. Because the 2020 Annual Meeting is being held virtually, registered shareholders who have not already voted by proxy can do so during the meeting by clicking the Vote My Shares section on your screen and entering your control ID and request ID, which appeared on the proxy materials previously sent to you. If you've already voted your shares by proxy prior to the meeting, you don't need to do anything at this time. I'd also like to take a moment to recognize Anthony Shriver, Sey Siegel and Greg Morris, 3 of our directors who are not standing for reelection this year. Their business experience, wisdom and guidance were important contributions to our company over the past few years. All of us will greatly miss their insight and counsel and we wish them the best. I would now like to present you Brian Pearlman, who is serving as Secretary of the 2020 Annual Meeting of Shareholders. Brian, is the meeting properly convened?

Yes, Mr. Chairman. I submit a copy of the notice of the 2020 Annual Meeting of Shareholders, the accompanying form of proxy provided for the meeting and the affidavit of mailing.

I order these documents to be filed with the records of the meeting. Brian, are the records of cbdMD showing the shareholders of common stock entitled to vote at this meeting available at the meeting?

Mr. Chairman, the certified record of the holders of the outstanding shares of common stock of cbdMD and their respective holdings as of the close of business on March 10, 2020, the date of record fixed by the Board of Directors for determining the shareholders entitled to notice of and to vote at this meeting. A copy of the list is available for inspection by registered shareholders through the adjournment of this meeting. If you would like an opportunity to inspect the certified list, please use the section on the right-hand side of your screen to submit your request.

These certified records will remain open for inspection throughout the meeting. Mark Elliott, cbdMD's Chief Financial Officer and Chief Operating Officer, has been previously appointed by the Board of Directors as inspector of election for this meeting. I direct that the oath of office previously administered to the inspector of election be filed with the record of the meeting. Having taking his oath of office, I declare Mark qualified to act. I direct him to take charge of all the polls and ascertain the shares present in person or represented by proxy and the votes cast on the business before the meeting. He's also directed to submit a report on results of such voting. Mark, will you report the number of common shares represented at the meeting, as prepared by you, the inspector of election for this meeting?

Mr. Chairman, there were represented by proxy, when the meeting was convened, the holders of at least 33 1/3% of the shares of cbdMD's common stock entitled to vote at this meeting, which constitutes a quorum for the purposes of this meeting.

Thank you. The report of inspector of election shows that a quorum necessary in order to transact the business to come before the meeting is present. I now refer to the notice of the 2020 Annual Meeting and advise the meeting. The first item of business concerns the election of 6 directors, each to serve until the 2021 Annual Meeting of Shareholders or until his successor has been qualified -- has been elected and qualified.

Mr. Chairman, I move that the nominations of Messrs. Martin A. Sumichrast, R. Scott Coffman, Bakari Sellers, Peter J. Ghiloni, Scott G. Stephen, and William F. Raines III as directors, each to serve until the 2021 Annual Meeting of Shareholders or until their successor has been elected and qualified, be confirmed and approved.

Do I hear a second?

Mr. Chairman, I second the motion.

There being no questions, we'll move forward to the next proposal. I now refer to the notice of the 2020 Annual Meeting and advise the meeting that the next item of business concerns the ratification of the appointment of Cherry Bekaert LLP as cbdMD's independent registered public accounting firm. I will enter a motion concerning this proposal.

Mr. Chairman, I move that the appointment of Cherry Bekaert LLP as cbdMD's independent registered public accounting firm be ratified.

Do I hear a second?

Mr. Chairman, I second the motion.

With there being no questions and since there are no other matters to be submitted to the vote of shareholders, I now declare these matters closed. The polls are now open for voting on the proposals. If you have not previously voted your shares by proxy, you can vote now by clicking the Vote my Shares section on your screen and entering your control and request ID. If you have voted by proxy, it is not necessary for you to vote a second time, unless you wish to revoke your prior proxy and change your vote at this time. You may do so by following instructions on your screen after you've entered your control ID and request ID. [Voting]

Okay. I declare the polls closed. Now I direct the inspector of elections canvass the results for votes. Mark, have you completed the preliminary report of inspector of elections with respect to these proposals?

Yes, Mr. Chairman. The preliminary report of inspector of election reflects that Messrs. Martin Sumichrast, R. Scott Coffman, Bakari Sellers, Peter J. Ghiloni, Scott G. Stephen, and William F. Raines III have been elected directors to serve until the 2021 Annual Meeting of Shareholders. And the proposal ratifying the appointment of Cherry Bekaert LLP has been approved by the cbdMD shareholders. This preliminary report is subject to correction by the final report of the inspector of election, where those results will be included in an 8-K to be filed by cbdMD with the SEC subsequent to this meeting.

Are there any further business to come before the meeting? There being no further business to come before the meeting, the polls are now closed. That concludes the formal part of the meeting, and the meeting is now adjourned. On behalf of my Co-CEO, Scott Coffman and all other members of the Board of Directors and our employees, I would like to thank all of you for the interest you've shown in cbdMD. We will provide a business update as part of our earnings call for the first quarter ended March 31, 2020, which we will hold in mid-May. We will announce a specific date and time as we get closer to that date. In the meantime, we encourage each of you to continue to follow the CDC guidelines, practice social distancing and stay diligent in doing your part to help our country get through this pandemic. We are all in this together. Please be safe. Thank you very much.

This concludes today's meeting. You may disconnect at this time. Thank you for your participation.