Flux Power Holdings, Inc. (FLUX) Earnings Call Transcript & Summary

Greetings. Welcome to Flux Power Holdings Annual Meeting of Shareholders. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to your host, Ron Dutt, CEO and Chairman. Please go ahead.

Thank you, and good morning, ladies and gentlemen. I'm Ron Dutt, Chairman of the Board of Directors of the company. I will be presiding at this meeting. Along with my fellow directors and executive officers of the company, I would like to welcome you to the 2021 Annual Meeting of Stockholders of Flux Power Holdings, Inc. We appreciate your attendance, your interest and most importantly, your support of the company. This annual meeting of the stockholders is held pursuant to the amended and restated bylaws of the company and written notice, which has been provided to all stockholders. Before we get started, I would like to remind you that management's commentary and responses to questions at today's meeting may include forward-looking statements, which, by their nature, are uncertain and outside of the company's control. Although these forward-looking statements are based on management's current expectations and beliefs, actual results may differ materially. For a discussion of some of the factors that could cause actual results to differ, please refer to the risk factor section of the company's latest annual and quarterly filings with the SEC. Note also that we assume no obligation to update forward-looking statements, except as required by law. You are participating in the meeting virtually. We are pleased to hold our annual stockholders' meeting virtually as we aim to increase access and participation. Stockholders may submit questions at any time during this meeting in the space provided on the virtual meeting screen. Questions will be addressed at the end after adjournment of the meeting. After introducing the directors and officers in attendance and dealing with a few procedural matters, we will take up the items to be acted upon. It is now slightly after 10:00 a.m., and I now call the meeting to order. Currently attending the meeting, along with myself, are Chuck Scheiwe, the Chief Financial Officer and Secretary; and Jon Berry, the Chief Operating Officer. I would also like to introduce the other members at today's meeting. Michael Johnson has served as our Director since July 2012; Lisa Walters-Hoffert has served as our Director since June 28, 2019; Dale Robinette has served as our director since June 2019; and John Cosentino, Jr. has served as our Director since May 2020. We also have our outside legal counsel, John Young of Lewis Brisbois Bisgaard & Smith LLP; and Mike Green of Baker Tilly US, LLP here today. Finally, the company has appointed Emily Watson of Issuer Direct Corporation to act as inspector of election. Ms. Watson is with us today and has taken the oath of inspector of election earlier today. All questions regarding the conduct of the voting, qualification of voters, acceptance or rejection of the votes and other matters of procedure will be decided by the inspector of elections. The Board of Directors fixed March 1, 2021, as the record date for determining stockholders entitled to vote at this meeting. An Affidavit has been delivered attesting to the fact that a notice of Internet availability of the notice of the meeting. The proxy statement and the 2021 annual report to stockholders we're all mailed on or about March 15, 2021, to all stockholders as of the record date and will be incorporated into the minutes of this meeting. Mr. Scheiwe, will you please report on the number of shares of common stock outstanding and entitled to be voted at this meeting.

Yes. The stockholder list shows that as of the record date, there were 12,703,847 shares of common stock outstanding and entitled to vote at this meeting. We are informed by the inspector of election that they are represented in person or by proxy, 9,759,109 shares of common stock representing votes of approximately 76.66% of the voting power on the record date. Since this represents more than the majority of the voting power of all issued and outstanding stock entitled to vote on the record date, a quorum is present for purposes of transacting business.

Thank you, Mr. Scheiwe. As Chairman, I find that a quorum is present for the purpose of conducting business at this meeting. And I hereby declare that this meeting is legally convened and ready to conduct business. A report of the inspector of elections will be filed with the minutes of this meeting. If you are a record holder of the common stock and would like to inspect the company's stockholder list, please submit a question requesting inspection of the stockholder list through the meeting portal, and we will reach out to you with further information. 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 directors. The current Board has nominated Ronald Dutt, Michael Johnson, Lisa Walters-Hoffert, Dale Robinette, John Cosentino, Jr., for election as Directors to hold office until the 2022 annual meeting of stockholders or until their successors are duly elected and qualified. Proposal 2 is to consider and vote upon a proposal to approve the 2021 Equity Incentive Plan. Proposal 3 is to consider and vote upon a proposal to ratify the appointment of Baker Tilly US, LLP, certified public accountants as our independent auditors for the fiscal year ended June 30, 2021. Proposal 4 is to consider and vote upon a proposal to approve, on an advisory basis, the compensation of our named executive officers. This is a nonbinding vote, although the compensation committee and the Board will certainly take the results of the vote into account when making future compensation decisions. Proposal 5 is to indicate, on an advisory basis, the frequency of future advisory votes on the compensation of our named executive officers. The Board of Directors recommends the approval of 3 years for the frequency of future advisory votes on the executive compensation of our named executive officers. Information concerning this proposal is contained in the proxy statement. If any stockholder would like to make a comment regarding any of the proposals, please submit your comments through the Internet. As I don't see any questions, I will proceed. All common stockholders of the company of record at the close of business on March 1, 2021, are entitled to vote at this meeting via telephone, mail, fax, over the Internet or by proxy. Each person that holds shares of common stock is entitled to 1 vote for each share held in his/her or its name. It is 11 minutes after 10:00 on April 29, 2021, and the polls for voting on all matters are open. All company stockholders who have not voted or wish to change their vote have the ability to do so online. Stockholders 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. Now that everyone has had the opportunity to vote, I now declare the polls for the 2021 Flux Power Holdings Annual Stockholder Meeting closed at 12 minutes after 10 a.m. Pacific Standard Time on April 29, 2021. After voting has been completed on all matters on the agenda, we will close the polls, and the inspector of election will provide their preliminary report. Mr. Scheiwe, do we have the preliminary voting results?

We do. We have been informed by the inspector of election that the preliminary vote report shows that each of the nominees for Director has been duly elected; the 2021 Equity Incentive Plan has been approved; the appointment of Baker Tilly US, LLP, certified public accountants as the company's independent registered public accounting firm has been ratified; the compensation of our named executive officers have been approved by advisory vote; and the stockholders have indicated that their preference is to hold an advisory vote on compensation of our named executive officers every 3 years. We will be reporting the final vote results in a Form 8-K to be filed within 4 business days.

Thank you, Mr. Scheiwe. There being no further business to come before the meeting, the 2021 Annual Meeting of Shareholders has now adjourned. I now invite you to ask any questions you may have regarding the company and its business. Please follow the instructions provided on the virtual meeting screen to submit questions. As there are no questions provided on the screen, ladies and gentlemen, I thank you for attending today's meeting.

This concludes today's conference, and you may disconnect at this time. Thank you for your participation.