KALA BIO, Inc. (KALA) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the Kala Pharmaceuticals 2020 Annual Meeting of Stockholders. I will now turn the program over to the CEO, President and Chairman of the Board of Kala, Mark Iwicki. Mark, you may begin.

Thank you very much, operator. Good morning, and welcome to the 2020 Annual Meeting of Stockholders of Kala Pharmaceuticals, Inc. I'm Mark Iwicki, Chief Executive Officer, President and Chairman of the Board of Kala Pharmaceuticals, Inc., and I will be presiding over this meeting. I welcome you and call the meeting to order. Due to the public health impact of the COVID-19 pandemic and to support the health and well-being of our stockholders, employees and communities, this year, we are holding our annual meeting in an all-virtual format and are pleased to have everyone join this live webcast. We have designed this meeting to provide stockholders the same rights and opportunities to participate as they would at an in-person meeting. At this time, I would like to turn it over to Eric Trachtenberg. Our General Counsel, Chief Compliance Officer and Corporate Secretary, to present the formal business of the meeting. Mr. Trachtenberg has also been appointed to act as inspector of election.

Thank you, Mark. Because this is a virtual meeting and voting is online, I will begin by declaring the polls open for each matter to be voted upon today. The polls will remain open until completion of the discussion on each proposal. If you have not voted or if you previously voted by proxy and wish to change your vote, you may vote by clicking on the voting button on the virtual meeting website and following the instructions there. I would like to begin with some introductions. Present at this meeting today are Andrew Koven, Gregory Perry, Gregory Grunberg, Howard Rosen, Robert Paull and Rajeev Shah, each of whom serve as a member of our Board of Directors. Also, in addition to myself and Mark, the following members of our management team are present today. Todd Bazemore, Chief Operating Officer; Kim Brazzell, Chief Medical Officer; Hongming Chen, Chief Scientific Officer; Mary Reumuth, Chief Financial Officer; and Niranjan Kameswaran, Senior Vice President, Strategy. I would like to also introduce Gerry Powderly and Sara Albano, representatives from Deloitte & Touche, our independent registered public accounting firm. In order to conduct an orderly meeting, I call your attention to the rules of conduct on the virtual meeting website, which include information about participating in the meeting, including asking questions. You may submit your questions at any time during the meeting prior to the closing of the polls. If asking a question, please include your name and affiliation to the company. Please also note that we will only be responding to questions regarding matters being voted on at the meeting. In the event that technology issues arise that interfere with our ability to continue the meeting, the meeting will be adjourned. If the meeting is adjourned, we plan to reconvene using the same meeting technology platform. Please check our website at www.kalarx.com for information regarding the time and date of which the meeting will reconvene. Please note that various remarks that we make about our future expectations, plans and prospects for a company constitute forward-looking statements for the purpose of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our most recent quarterly report on Form 10-Q, which is on file with the SEC. In addition, these forward-looking statements represent the company's expectations only as of today. While the company may elect to update these forward-looking statements, it specifically disclaims any obligation to do so. Any forward-looking statements should not be relied upon as representing the company's estimates or views as of any date subsequent to today. I received an affidavit from the company's transfer agent, American Stock Transfer and Trust Company, LLC, certifying that the notice of the annual meeting and proxy statement were sent to all stockholders of record as of April 27, 2020, a copy of which will be included in the minutes of the meeting. Our first order of business at this meeting is to determine whether the shares represented at this meeting, either in person, via this virtual meeting or by proxy are sufficient to constitute a quorum for the purposes of transacting business. Holders of 55,715,876 shares of common stock are entitled to vote at this meeting. I have confirmed as inspector of election that there are present at this meeting, either in person or by proxy, a total of 46,911,132 shares of common stock or approximately 84% of all shares entitled to vote at this meeting. Therefore, I declare that a quorum exists. Turning now to the items to be voted on at the meeting. As indicated in the notice of meeting and accompanying documents that were made available to stockholders, the first matter to be voted on is the election of 3 Class III directors to serve until 2023 Annual Meeting of Stockholders and until their successors are duly elected and qualified. The 3 nominees for election are: Robert Paull, Howard Rosen and Rajeev Shah. The next matter to be voted on is the ratification of the appointment of Deloitte & Touche as our independent registered public accounting firm for the fiscal year ended December 31, 2020. The next and final matter to be voted on is the approval of an amendment to the company's 2017 equity incentive plan to increase the number of shares authorized for issuance thereunder. I see no questions, we'll move on to the closing of the polls. The business items on the agenda for this meeting are complete, and the polls are now closed. I will now tabulate the vote. We now have the preliminary report of the results of the meeting. On the motion that the nominees be elected as Class III directors of the company, for each nominee, at least 30,667,896 shares have been voted for the nominees with the highest number of shares withheld being 9,733,314 shares and the highest number of broker non-votes being 6,509,922 shares. The holders of a plurality of the votes cast at this meeting have been voted for each of the nominees, I hereby declare that each of the nominees has been elected as a Class III director. On the motion that the selection of Deloitte & Touche as the company's independent registered public accounting firm for the current fiscal year be ratified, 46,871,709 shares or approximately 99% of the shares present or represented and entitled to vote at this meeting have voted in favor for the proposal. 33,217 shares or approximately less than 1% have voted against the proposal. 6,206 shares have abstained, and there were no broker non-votes. The holders of a majority of the shares cast at this meeting and voting affirmatively or negatively on the matter having been voted in favor of the ratification of Deloitte & Touche as the company's independent registered accounting firm for the current fiscal year, I hereby declare that the selection of such firm has been ratified. On the motion that an amendment to the company's 2017 equity incentive plan to increase the number of shares authorized for issuance thereunder be approved, 33,842,091 shares or approximately 84% of the shares present and represented and entitled to vote at this meeting have voted in favor of the proposal. 6,538,497 shares or approximately 16% have voted against the proposal. 20,622 shares or approximately less than 1% have abstained, and there were 6,509,922 broker non-votes. The holders of the majority of the votes cast at this meeting and voting affirmatively or negatively on the matter, having voted in favor of the amendment to the company's 2017 equity incentive plan to increase the number of shares authorized for issuance thereunder, I hereby declare that the amendment has been approved. The final votes will be included in the Form 8-K that will be filed within 4 business days after this meeting. As there is no further business to come before the meeting, I declare the formal part of this meeting adjourned.

Ladies and gentlemen, this does conclude your call. You may now disconnect your lines.