Enterprise Financial Services Corp (EFSC) Earnings Call Transcript & Summary

Good evening, and welcome to the Enterprise Financial Services Corp's Annual Meeting of Shareholders. I would now like to introduce Jim Lally, CEO and member of the Board of Directors. Jim?

Well, thank you, and good afternoon, and welcome to the 2021 Annual Shareholders' Meeting of Enterprise Financial Services Corp. I am Jim Lally, President, Chief Executive Officer and member of the Board of Directors of Enterprise Financial Services Corp. Due to the continuing public health and safety concerns related to the COVID-19 pandemic and to support the health and well-being of our shareholders, employees and communities, we are hosting a virtual meeting today. I want to thank you for being a shareholder and for joining us on this webcast. With that, it is my pleasure to introduce you to Mr. John Eulich.

Thank you, Jim. Good afternoon. I'm John Eulich, Chairman of the Board of Directors of Enterprise Financial Services Corporation. On behalf of the Board and management, I want to welcome you and thank you for joining us today. Due to the unique circumstances we are faced with today, we will be limiting this webcast to conducting the formal meeting of required matters for voting, and we'll not be engaging in any post-meeting question-and-answer session. We will respond to shareholder questions or comments during this meeting to the extent anyone has a relevant comment or question that relates to one or more of the proposals being considered today. However, to the extent you have any questions or comments that are unrelated to our proposals, we would encourage you to reach out to our Investor Relations department via the contact information provided on our website and in our proxy materials. We appreciate your patience as we navigate these challenges. It is now shortly after 5:00 p.m. Central Time on April 28, 2021, and this meeting is officially called to order. Besides myself and Jim Lally, I would like to now introduce the other members of the Board joining us for today's meeting. Michael DeCola. Mike has served as a Director since 2007 and also serves as the Chair of our Compensation Committee. Robert Guest. Bob has served as a Director since 2002 and also serves as the Chair of our Risk Committee. James Havel. Jim has served as Director since 2014. Judith Heeter. Judy has served as a Director since 2012 and also serves as the Chair of our Nominating and Governance Committee. Michael Holmes. Michael has served as a Director since 2015. Nevada Al Kent. Al has served as a Director since 2017. Richard Sanborn. Rick has served as a Director since 2020. Eloise Schmitz. Eloise has served as a Director since 2017. Sandra Van Trease. Sandra has served as a Director since 2005 and also serves as the Chair of our Audit Committee. Our Board is rounded out by Anthony Scavuzzo. Tony has served as a Director since 2019, but he is unable to join us today. We are also joined here today by Deloitte & Touche LLP, our independent auditors. Computershare Trust Company is the company's stock transfer agent registrar and dividend dispersing agent. [ Nancy Hoffmann ], a representative from Broadridge Financial Solutions, Inc., has been appointed as the inspector of election, and she is also joining us today. The oath of the inspector of election was executed by the inspector of election and will be attached to the meeting's -- the minutes of this meeting. In accordance with the company's bylaws, I will act as Chairman of this meeting; and Nicole Iannacone, Corporate Secretary of the company, will act as Corporate Secretary of the meeting. So I would now like to ask that the meeting will please come to order. A notice regarding this annual meeting and the availability of the proxy material was mailed to shareholders in the proxy statement, and notice were made available on or about March 17, 2021. The Board of Directors fixed March 4, 2021, as the record date for determining shareholders entitled to vote at this meeting. A complete list of the registered holders of the common stock of the company as of March 4, 2021, is available for viewing by registered shareholders by clicking on the RSL link on the web portal in the lower right-hand portion of your screen. The shareholder list shows that, as of the record date, there were 31,255,259 shares of common stock outstanding and entitled to vote at this meeting. The Corporate Secretary will please file a copy of the list of shareholders with the records of this meeting. The inspector of election has reported that the holders of at least a majority of the issued and outstanding shares of the voting stock of the company entitled to vote at this meeting are present in person, including by a virtual attendance or by proxy, constituting a quorum. The meeting is now duly convened and ready to transact business. Now I will present the matters to be voted upon. Please note that we will give shareholders an opportunity to comment on the proposals during this meeting. If any shareholder wishes to make a comment on a proposal, we ask that you please type in your comment in the Q&A box that appears in the lower right-hand portion of your screen in the web portal. In order to conduct an orderly business, we again ask that all shareholders keep their comments brief and limited to the specific proposals up for discussion today. As noted previously, we will respond to relevant comments and questions related to proposals. But to the extent you wish to comment on other unrelated matters, we would ask you to direct such questions or comments to our Investor Relations department. The items of business for today's meeting consists of: one, the election of the 12 Directors named in the company's proxy statement to serve until the next annual meeting, or until their successors have been elected and qualified; two, the ratification of the company's selection of Deloitte & Touche LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2021; three 3, approval of an amendment to the Enterprise Financial Services Corp Amended and Restated 2018 Stock Incentive Plan to increase the number of shares available for award under the plan; four, an advisory nonbinding resolution approving the company's executive compensation; and five, an advisory nonbinding resolution on the frequency of the advisory vote on executive compensation. The company has not received notice from any of its shareholders as required under its bylaws of any other matter to be considered at today's meeting, and therefore, no other proposals may be introduced by shareholders. The first order of business, as described in the proxy statement, is the election of the 12 directors named in the proxy statement. As set forth in the company's proxy statement, the Board of Directors, on the recommendation of the Nominating and Governance Committee, has nominated the following persons as Directors: Michael A. DeCola; John S. Eulich; Robert E. Guest, Jr.; James M. Havel; Judith S. Heeter; Michael R. Holmes; Nevada A. Kent IV; James B. Lally; Richard M. Sanborn; Anthony R. Scavuzzo; Eloise E. Schmitz; and Sandra A. Van Trease. In accordance with the company's bylaws, shareholders are required to provide advanced notice of their intent to nominate directors -- candidates for directors. No such other notice was received. Therefore, I declare the nominations for directors closed. If any shareholder would like to make a comment regarding this first proposal, please submit your comment now.

We have not received any shareholder comments regarding this proposal.

Thank you, Nicole. The second order of business, as described in the proxy statement, is Proposal A, regarding ratification of the selection of Deloitte & Touche LLP as the company's independent registered public accounting firm for fiscal year ending December 31, 2021. The Board of Directors, on behalf of the Audit Committee, recommends a vote for the adoption of the resolution. If any shareholder would like to make a comment regarding the second proposal, please submit your comments now.

We have not received any shareholder comments regarding this proposal.

Thank you, Nicole. The third order of business, as described in the proxy statement, is proposal B, regarding the approval of an amendment to the Enterprise Financial Services Corp Amended and Restated 2018 Stock Incentive Plan to increase the number of shares available for award. The Board of Directors recommends a vote for the approval of the amendment to increase the number of shares available for award under the Amended and Restated 2018 Stock Incentive Plan. If any shareholder would like to make a comment regarding the third proposal, please submit your comments now.

We have not received any shareholder comments regarding this proposal.

Thank you, Nicole. The fourth order of business, as described in the proxy statement, is Proposal C, regarding the advisory nonbinding resolution approving executive compensation. We are required by law to provide our shareholders the opportunity to vote on an advisory and nonbinding resolution. While this resolution will not be binding on the Board, the Board will take the outcome of the vote into consideration in making future executive compensation decisions. The text of the proposed resolution is as follows: "Resolved, that the shareholders hereby approve the compensation of the company's named executive officers, as disclosed in the company's proxy statement for the 2021 Annual Meeting of Shareholders, including the Compensation Discussion and Analysis, the tabular disclosure regarding compensation of our named executive officers and the narrative disclosure accompanying those tables." The Board of Directors recommends a vote for the adoption of the resolution. If any shareholder would like to make a comment regarding the fourth proposal, please submit your comments now.

We have not received any shareholder comments regarding this proposal.

Thank you, Nicole. The fifth order of business, as described in the proxy statement, is Proposal D, regarding the advisory nonbinding resolution on the frequency of the advisory vote on executive compensation. We are required by law to provide our shareholders the opportunity to vote on an advisory and nonbinding resolution on how often the company should include the advisory say-on-pay vote in its proxy materials for future annual shareholder meetings. The options for preferred advisory voting frequency are once a year, once every 2 years and once every 3 years. While this resolution will not be binding on the Board, the Board will take the outcome of the vote into consideration in making its decision. The text of the proposed resolution is as follows: "Resolved, that the option of once every year, once every 2 years or once every 3 years that receives the highest number of votes cast for this resolution will be determined to be the preferred frequency for holding an advisory shareholder vote to approve the compensation of the named executive officers, as disclosed in the proxy statement pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table and the other related tables and disclosure." The Board of Directors recommends a vote for every -- for once every year, i.e., 1 year, for the frequency of the advisory vote on executive compensation. If any shareholder would like to make a comment regarding the fifth proposal, please submit your comments now.

We have not received any shareholder comments regarding this proposal.

Thank you, Nicole. There are no further proposals to present. I now hereby declare the polls open to vote on all proposals. Any shareholder who has not yet voted or wishes to change their vote may do so by clicking on the voting button appearing on the lower right-hand portion of your screen in the web portal and following the instructions. Shareholders who have sent in proxies or voted via telephone or Internet and do not want to change their vote do not need to take any further action. [Voting]

The holder of proxies appointed by the Board has cast a ballot voting all proxies received by management. As the shareholders have had an opportunity to vote, I now declare the polls for the 2021 Enterprise Financial Services Corp Annual Shareholder Meeting closed. We have been informed by the inspector of election that the preliminary vote report shows that the nominees for election to the Board of Directors have been duly elected. I declare each of such nominee to be elected to the Board of Directors of the company for a term of 1 year, or until their successors are duly elected and qualified. We are also informed by the inspector of election that Proposals A, B and C have each received a favorable vote of a majority of votes cast, and each such proposal is therefore passed and approved. We are further informed by the inspector of election that a vote of 1 year received the majority of votes cast as to Proposal D, and such proposal has therefore passed as to 1 year and approved. We will file the final report of the inspector of election with the records of this meeting. We expect to report the results of the voting on a Form 8-K to be filed with the SEC within 4 business days of this meeting. There being no further business to come before the meeting, the 2021 Annual Meeting of Shareholders of Enterprise Financial Services Corp is hereby declared adjourned. Thank you again for attending today.

Thank you. The Annual General Meeting for Enterprise Financial Services Corp has now come to an end. Thank you for attending. You may now leave the virtual meeting.