LPL Financial Holdings Inc. (LPLA) Earnings Call Transcript & Summary

Good day, ladies and gentlemen, and welcome to your 2020 Annual Meeting of LPL Financial Holdings Inc. [Operator Instructions] At this time, it is my pleasure to turn the floor over to your host, Jim Putnam. Sir, the floor is yours.

Thank you so much, and good morning, and greetings from San Diego, and thank you for joining us. My name is Jim Putnam, and I am the Chair of the Board of Directors of LPL Financial Holdings Inc. It is my pleasure to welcome you to our 2020 Annual Meeting of Stockholders and to call the meeting to order. As you know, we are hosting the meeting virtually this year in light of public health and safety precautions related to COVID-19 pandemic. During these extraordinary times, I wanted to start the meeting by thanking our company's financial advisers, who continue to provide financial guidance to millions of American families at a time when it is most needed. I also want to thank our company's employees for their hard work these past few months and focused commitment to LPL's mission of taking care of our advisers so they can take care of the clients. And finally, I'd like to thank our stockholders for their support during this time period. As Dan Arnold, my fellow director and the company's Chief Executive Officer, reported on last week's earnings call, our company delivered solid results in the first quarter of 2020 and continues to be highly focused on generating long-term shareholder value. Turning to participants in the meeting, I will serve as Chair; and Michelle Oroschakoff, our Chief Legal Officer, will serve as secretary. Each of our director nominees is participating virtually as is Chris Herrmann from Deloitte & Touche, the company's independent registered public accounting firm. I would also like to acknowledge Ed Bernard, who is nominated this year as a new independent director; and Jim Riepe, who is retiring from the Board today after years of distinguished service. As is our custom, we will conduct the business portion of the meeting first and then answer questions at the end of the meeting. Matt Audette, the company's Chief Financial Officer, will also be available to answer questions. I would now ask Michelle to provide the secretary's report and explain our voting and other procedures.

Thank you, Jim. Copies of the agenda and rules of procedure for the meeting are available on the web portal. We will follow them closely so that we conduct this meeting as efficiently as possible. As Jim mentioned, after the formal meeting has been adjourned, we will provide time for appropriate questions submitted by stockholders through the web portal. This annual meeting is being held pursuant to proper notice. We have received an affidavit from Broadridge Financial Solutions attesting to the mailing of proxy materials on March 23, 2020, to stockholders of record as of March 9, 2020. The affidavit will be filed with the minutes of this meeting. American Election Services, Inc. (sic) [ American Election Services, LLC ] has been appointed as inspector of elections. James Raitt, a representative of that firm, is participating today virtually and has taken oath of inspector of election. Most stockholders have already voted by proxy, and those proxy votes have been tallied. We are informed by the inspector of elections that proxies representing more than 91% of the 79,099,422 shares of the company's outstanding stock eligible to vote have been received, and therefore, a quorum is present. Any stockholder who hasn't yet voted or wishes to change their vote may do so by clicking on the voting button on the web portal and following the instructions there. Stockholders who executed proxies or voted online or by phone do not need to take any further action. Voting at this meeting will revoke any earlier proxy that you gave.

Thanks, Michelle. I would now ask you to review the matters to be voted on today as described in the proxy statement.

The first item of business coming before the meeting is the election of directors. The following 9 individuals, all of whom are in attendance virtually, have been properly nominated by the Board to serve as directors until the 2021 Annual Meeting of Stockholders: Dan Arnold, Edward Bernard, Paulett Eberhart, William Glavin Jr., Allison Mnookin, Anne Mulcahy, James Putnam, Richard Schifter and Corey Thomas. The second item of business is ratification of the appointment of Deloitte & Touche LLP by the Audit Committee of the Board as the company's independent registered public accounting firm for the fiscal year ending December 21 -- December 31, 2020. The third and final item of business is an advisory vote to approve the compensation paid to the company's named executive officers. As Jim mentioned, each of these proposals is discussed in the company's proxy statement, and the Board recommended election of each nominee as a director and approval of each of proposals 2 and 3. The polls are now open. Any stockholder who hasn't yet voted or wishes to change their vote may do so now. [Voting]

Now that everyone has had an opportunity to vote, the polls are closed.

Thank you, Michelle and James. Please provide us with the preliminary voting results.

Proposal #1 is the election of directors. In an uncontested election, a director nominee will be elected if the number of votes cast for the nominee exceeds the number of votes cast against the nominee. James, please report the vote. James, can you please report the vote?

All directors have received the majority of the voting in favor.

Thank you, James. Each of the nominees have been duly elected. Proposal 2, ratification of the appointment of the company's independent auditors requires the affirmative vote of the majority of the shares cast affirmatively or negatively in person or by proxy. James, please report the vote on this proposal.

The directors have received the affirmative vote of the majority of the shares voted at this meeting.

Thank you. Proposal #2 is approved. Proposal #3 is the approval in an advisory vote of the compensation paid to the company's named executive officers. Although the outcome of the vote is nonbinding, our Compensation Committee and Board value the views of our stockholders and will consider the outcome of the vote when determining future compensation arrangements for our named executive officers. James, please report the vote.

The director or say on pay vote has received the majority of the votes in favor [indiscernible] received and voted at this meeting.

Thank you, James. The outcome of the vote on the proposal is noted. A report from the Inspector of Elections with the results of these votes will be filed with the minute books of the company. In addition, we will report the results in a filing with the SEC on Form 8-K.

Thank you, Michelle. We have now completed the business for the meeting, and the formal portion of this meeting is adjourned. Next, we will open up for stockholder questions from the web portal. In the interest of time, we would ask stockholders to submit no more than 2 questions. Great. We'll open it up for questions. Okay. Thank you very much. Seeing no questions, we will adjourn the meeting, and thank you all for your participation.

Operator, please close the lines.

Thank you. Ladies and gentlemen, this does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time, and have a great day.