Energous Corporation (WATT) Earnings Call Transcript & Summary

Good morning, all, and welcome to the Energous Corporation 2020 Annual Meeting of Stockholders. Please note that this event is being webcast. I would now like to turn the conference over to Stephen Rizzone. Mr. Rizzone, please go ahead, sir.

Thank you. Good morning. I would like to welcome everyone to the Energous 2020 Annual Meeting of Stockholders. I am Stephen Rizzone, President, Chief Executive Officer and a director of the company. I will act as Chairman of this annual meeting. We are pleased to be able to transact this meeting virtually, which allows us to safely reach a greater number of our stockholders without the need to meet in person, especially in light of the current pandemic. I will now call the meeting to order and introduce Brian Sereda, our Senior Vice President, Chief Financial Officer and Secretary, who will act as secretary of this annual meeting and keep the minutes. Brian?

Thanks, Steve. I'm advised by the inspector of election that over a majority of our outstanding common stock entitled to vote at this meeting is present or represented by proxy here today and that a quorum is therefore present. We will describe the proposals to be voted on today later during the meeting. The polls are now open for voting. Voting is by proxy and electronic ballot. Any stockholder who has not voted or wishes to change his or her vote may do so by clicking the Vote button on the webcast portal and following the instructions there. Stockholders who have sent in proxies or previously voted via the Internet or by phone and who do not wish to change their vote or do not need to take further action, their votes will be counted automatically. We expect to close the polls approximately 2 minutes after the presentation of matters to be voted on at the meeting and the explanation regarding the questions and replies. We will not have a live question-and-answer session at this meeting. We will post the replies to the most relevant questions on the Investor page of our website at ir.energous.com after the meeting. [Operator Instructions] This meeting is being recorded. However, no one attending via webcast is permitted to use any audio recording device. A webcast playback will be available at the same link for this meeting within 24 hours of the meeting. The webcast will be available for approximately 1 year. In addition to Mr. Rizzone, the other directors of Energous Corporation present by remote access are: Robert R. Griffin (sic) [ Robert J. Griffin ], Daniel W. Fairfax and Rahul Patel. In addition to myself, the other officers of Energous Corporation present by remote access are: Cesar Johnston, our Executive Vice President and Chief Operating Officer; and Neeraj Sahejpal, our Senior Vice President of Marketing and Strategy. I would also like to introduce a few others in attendance by remote access today. Nicolas Dumont of Fenwick & West LLP, our Legal Counsel; and Kathy Wheadon, a representative of the company's proxy adviser, Broadridge Financial Solutions, which will act as the inspector of election for this meeting and tabulate the results of the voting. Kathy Wheadon has executed the oath of inspector of election. Let me now turn to the formal business of this meeting. The proposals to be considered are described in our definitive proxy statement dated April 20, 2020, and I will review these in a few minutes. But first, I will report on the notice for this meeting. Our Board of Directors fixes March 27, 2020 as the record date for determining the stockholders entitled to vote at this meeting. I present to this meeting an affidavit of Broadridge Financial Solutions, Inc., attesting that the proxy statement was mailed on or about April 20, 2020, to all of Energous Corporation's stockholders of record determined as of the close of business on the record date. The affidavit will be incorporated into the minutes of this meeting. I have a list of the stockholders entitled to vote at this meeting, which is available for inspection by any stockholder present or by any proxy holder representing a stockholder, and which will be filed with the records of this meeting. The registered stockholder list is available for the duration of the meeting and can be found on the meeting page in the footer section. The list of stockholders shows that at the close of business on the record date, Energous had 36,432,839 shares of common stock outstanding, each entitled to 1 vote at this meeting. As previously mentioned, the inspector of election has advised that over a majority of our common stock entitled to vote at this meeting is present or represented by proxy here today and that a quorum is therefore present. We are authorized -- we are, therefore, authorized to transact business at this meeting. Now I will present the matters to be voted upon. Matter one, election of directors. The first item of business is to elect 6 directors of Energous to hold office until the next annual meeting and the election of their successors. The nominees for directors recommended by the Board of Directors are as follows: Stephen R. Rizzone; Robert J. Griffin; Daniel W. Fairfax; Michael Noonen; Rahul Patel; and Reynette Au. The Board of Directors recommends a vote for each of the director nominees. No other director nominees have been properly submitted for election pursuant to our bylaws or the Securities and Exchange Commission rules. Therefore, no other nominations may be accepted. As secretary of this annual meeting and on behalf of the Board of Directors, I move for the election of each of the nominated directors, which motion is second by proxy. Matter 2, ratification of the appointment of independent registered public accounting firm. The second item of business is to ratify the appointment of Marcum LLP as independent registered public accounting firm of Energous for the year ended December 31, 2020. The Board of Directors recommends a vote for this proposal. As secretary of this annual meeting and on behalf of the Board of Directors, I move for the approval of this proposal, which motion is second by proxy. Matter 3, advisory vote on the compensation of our named executive officers. The third item of business is to approve by a nonbinding advisory vote the compensation paid by us to our named executive officers. The Board of Directors recommends a vote for this proposal. As secretary of this annual meeting and on behalf of the Board of Directors, I move for approval of this proposal on a nonbinding advisory basis, which motion is second by proxy. Matter 4, advisory vote on the frequency of future advisory votes on the compensation of our named executive officers. The fourth item of business is to approve by a nonbinding advisory vote whether future nonbinding advisory votes to approve the compensation paid by us to our named executive officers should be held every 1, 2 or 3 years. The Board of Directors recommends holding future nonbinding advisory votes on the compensation of our named executive officers every 2 years. As secretary of this annual meeting and on behalf of the Board of Directors, I move for the votes for 2 years for this proposal on a nonbinding advisory basis, which motion is second by proxy. Matter 5, approval of amendment and restatement of the 2013 equity incentive plan. The fifth item of business is to approve an amendment and restatement of our 2013 equity incentive plan that will increase the number of shares available for issuance by 1,200,000 shares from 6,085,967 shares currently to 7,285,967 shares and effect certain other changes as set forth in our definitive proxy statement. The Board of Directors recommends a vote for this proposal. As secretary of this annual meeting and on behalf of the Board of Directors, I move for approval of this proposal, which motion is second by proxy. Matter 6, approval of amendment and restatement to nonemployee equity compensation plan. As secretary of this annual meeting and on behalf of the Board of Directors, I move for approval of this proposal, which motion is second by proxy. Matter 7, approval of amendment of -- to Energous Corporation's employee stock purchase plan. The seventh item of business is to approve an amendment and restatement of our Employee Share Purchase Plan, or ESPP, that will be -- that will increase the number of shares available for issuance by 250,000 shares from 600,000 shares currently to 850,000 shares. The Board of Directors recommends a vote for this proposal. As secretary of this annual meeting, and on behalf of the Board of Directors, I move for approval of this proposal, which motion is second by proxy. Matter 8, approval of amendment and restatement of Energous Corporation performance share unit plan. The eighth item of business is to approve an amendment and restatement of our performance share unit plan, PSU plan, that will increase the number of shares reserved under the PSU plan by 700,000 shares to 3,410,104 as well as permit the Board of Directors to choose the performance metric for PSUs issued under the plan and modify the terms and conditions of accelerated vesting of awards and effect certain other changes as set forth in our definitive proxy statement. The Board of Directors recommends a vote for this proposal. As secretary of the annual meeting and on behalf of the Board of Directors, I move for approval of this proposal, which motion is second by proxy. Matter 9, approval of an amendment to our certificate of incorporation. The ninth item of business is to approve an amendment to our certificate of incorporation to increase the number of total authorized shares from 60 million to 210 million shares and the number of authorized shares of common stock from 50 million to 200 million shares. The Board of Directors recommends a vote for this proposal. As secretary of this annual meeting and on behalf of the Board of Directors, I move for approval of this proposal, which motion is second by proxy. Matter 10, approval and amendment to our certificate of incorporation to effect a reverse stock split by a ratio of 1-for-3 up to a ratio of not to exceed 1-for-20. The tenth item of business is to approve an amendment to our certificate of incorporation to effect a reverse stock split by a ratio of 1-for-3 up to a ratio of not to exceed 1-for-20, which the Board of Directors may elect to abandon in its sole discretion. The Board of Directors recommends a vote for this proposal. As secretary of this annual meeting and on behalf of the Board of Directors, I move for approval of this proposal, which motion is second by proxy. That concludes the discussion on the proposals. We will not have a live question-and-answer session at this meeting. We will post replies of 2 of the most relevant questions on the Investor page of our website at ir.energous.com after the meeting. Please note that we will not address any questions that are irrelevant to the matters presented at this meeting. [Operator Instructions] As noted earlier, the voting today is by proxy and electronic ballot. Any stockholder who has not voted or wishes to change his or her vote may do so by clicking the Vote button on the webcast portal and following the instructions there. Stockholders who have sent in proxies or previously voted via the Internet or by phone and who do not wish to change their vote do not need to take further action. Their votes will be counted automatically. We expect to leave the polls open for approximately 2 minutes to allow anyone who chooses to vote here to cast ballots. Time begins now. [Voting]

Now that everyone has had the opportunity to vote, I now declare the polls for the 2020 Annual Meeting of Stockholders of Energous Corporation closed. We now have preliminary voting results. The vote required to elect directors is the plurality of the votes cast, which means that the 6 individuals nominated for election of the Board of Directors at the meeting receiving the highest number of for votes will be elected. Each of the nominees has been elected. Each nominee received a plurality of the votes cast. The ratification of the Audit Committee's appointment of Marcum LLP as our independent registered public accounting firm for 2020 requires the affirmative vote of the majority of the shares present or represented at the 2020 annual meeting virtually online or by proxy. The appointment of Marcum LLP as Energous' independent registered public accounting firm for the year ending December 31, 2020, has been ratified by the requisite majority of votes cast at this meeting. The vote required to approve by a nonbinding advisory vote the compensation paid by us to our named executive officers is the affirmative vote of the holders of a majority of the shares present or represented at this meeting virtually online or by proxy. The proposal to approve by a nonbinding advisory vote the compensation paid by us to our named executive officers received the requisite majority of votes cast at this meeting and is therefore approved. The frequency of future nonbinding advisory votes on the compensation of our named executive officers receiving the greatest number of votes at the annual meeting will be deemed to be the preferred frequency option of our stockholders. A proposal to approve by a nonbinding advisory vote to hold future nonbinding advisory votes on the compensation of our named executive officers every 2 years received the greatest votes cast at this meeting and is therefore approved. The vote required to approve an amendment and restatement of our 2013 equity incentive plan is the affirmative vote of the holders of a majority of the shares present or represented at this meeting virtually online or by proxy. The amendment and restatement of our 2013 equity incentive plan received the requisite majority of votes cast at this meeting and is therefore approved. The vote required to approve an amendment and restatement of our nonemployee compensation plan is the affirmative vote of the holders of the majority of the shares present or represented at this meeting virtually online or by proxy. The amendment and restatement of our nonemployee compensation plan received the requisite majority of votes cast at this meeting and is therefore approved. The vote required to approve an amendment and restatement of our Employee Share Purchase Plan, ESPP, is the affirmative vote of the holders of the majority of the shares present or represented at this meeting virtually online or by proxy. The amendment and restatement of our Employee Share Purchase Plan, ESPP, received the requisite majority of votes cast at this meeting and is therefore approved. The vote required to approve an amendment and restatement of our performance share unit plan, PSU plan, is the affirmative vote of the holders of the majority of the shares present or represented at this meeting virtually online or by proxy. The amendment and restatement of our performance share unit plan, PSU plan, received the requisite majority of votes cast at this meeting and is therefore approved. The vote required to approve an amendment to our certificate of incorporation to increase the number of total authorized shares from 60 million to 210 million shares and the number of authorized shares of common stock from 50 million to 200 million shares is the affirmative vote of a majority of the shares of outstanding common stock virtually online or by proxy. The amendment to our certificate of incorporation to increase the number of total authorized shares from 60 million to 210 million shares and the number of authorized shares of common stock from 50 million to 200 million shares received the requisite affirmative vote of holders of a majority of the shares of outstanding common stock and is therefore approved. The vote required to approve an amendment to our certificate of incorporation to effect the reverse stock split by a ratio not to exceed 1-for-20 is the affirmative vote of the holders of the majority of the shares of outstanding common stock virtually online or by proxy. The amendment to our certificate of incorporation to effect a reverse stock split by a ratio of 1-for-3 up to a ratio of not to exceed 1-for-20 has not received the requisite affirmative vote of holders of a majority of the outstanding -- shares of outstanding common stock and therefore has not been approved. There are no other formal items of business before this meeting. Final results of the vote will be recorded, as stated, in the minutes of this meeting and also filed with the Securities and Exchange Commission on a Form 8-K within 4 business days. This concludes our meeting, and the annual meeting is now adjourned. Thank you for your participation.

Ladies and gentlemen, once again, this does conclude today's session. And we do thank you all for your participation. You may now disconnect your lines, and we hope that you enjoy the rest of your day.