PC Connection, Inc. (CNXN) Earnings Call Transcript & Summary

Good day, and thank you for standing by. Welcome to the PC Connection, Inc. 2023 Annual Meeting. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Tim McGrath, President and CEO. Please go ahead.

Good morning, everyone, and welcome to PC Connection's 2023rd Annual Stockholder Meeting. I'm Timothy McGrath, President and CEO of Connection, and I'll be presiding over this meeting. At this time, I call the meeting to order. We have, again, this year, supplemented our in-person meeting with a currency dial-in for stockholders who have submitted their proxy in advance of the meeting and wish to listen to the meeting remotely rather than attending in-person. Only stockholders who are here in-person may vote in-person or otherwise participate. I'd now like to introduce the members of our Board and our company officers as well as representatives of Deloitte & Touche LLP, our external auditing firm and WilmerHale, our external corporate counsel. Representing our Board of Directors is the Chair of our Board, Patricia Gallup; our Vice Chair, Jay Bothwick; David Beffa-Negrini; Barbara Duckett; Jack Ferguson; and Gary Kinyon. Also with us today is our CFO and inspector of elections, Tom Baker, as well as a number of our senior members of management who are joining remotely: Joan Evans, Rick Gilligan, Brian Hicks, Dave Hall, Bob Pratt, Cam Kelly, Jamal Khan, Larry Kirsch, Mickey Bland, and Kyle Reeb. In addition, representing WilmerHale is partner, Lilly Brown; and representing Deloitte & Touche, is partner, Raymond Bigelow, both of who are joining remotely. At the conclusion of the meeting, we'll be available to answer any questions that any stockholder may have. Each of you should have checked in at the registration desk prior to entering the meeting. In order to conduct an orderly meeting, we ask that you follow the rules of conduct for the meeting, copies of which have been provided. I'll now commence the formal part of the meeting. I have received an affidavit from Broadridge Financial Solutions certifying that the notice of the annual meeting and the proxy statement were sent to all stockholders of record as of March 31, 2023. This affidavit and the list of stockholders entitled to vote at the meeting are available for any inspections for any stockholder. Our first order of business at the meeting is to determine whether the shares represented at the meeting, either in person or by proxy, are sufficient to constitute a quorum for the purposes of transacting business. Mr. Baker has been appointed as inspector of election. Tom has reported to me that they are present at this meeting in-person or through representation by proxy, a total of at least 25,176,000 shares of common stock. Since more than a majority of the outstanding shares of capital stock are represented at the meeting, I hereby 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 the accompanying proxy statement, which were mailed to all stockholders. Our agenda today consists of 3 items: One, to elect 6 directors to serve until the 2024 Annual Meeting of Stockholders; two, to approve an amendment to the company's 2020 stock incentive plan, increasing the number of shares of common stock authorized for issuance under the plan from 1,002,500 to 1,252,500 shares; and to ratify the selection of the Audit Committee of Deloitte & Touche LLP as our independent registered public accounting firm for the year ending December 31, 2023. As the polls for these matters will open following a brief discussion of these matters and will remain open until I announce that the polls are closed. No ballots, proxies or revocations thereof or changes thereto will be accepted after the polls are closed. I'll announce the preliminary results of voting immediately following the tabulation of the voting. Are there any stockholders present who wish to vote in-person because they either have not submitted a proxy or have submitted a proxy, but wish to revoke their proxy and change their vote? As the first matter to be voted on by stockholders is the election of directors to serve until the 2024 Annual Meeting of Stockholders and until their successors are duly elected and qualified. The nominees for election are: Patricia Gallup, David Beffa-Negrini, Jay Bothwick, Barbara Duckett, Jack Ferguson and Gary Kinyon. The next matter to be voted on by the stockholders is the amendment of the company's 2020 stock incentive plan to increase the number of shares of common stock that maybe issued from 1,002,500 to 1,252,500, representing an increase of 250,000 shares. The final matter to be voted on by the stockholders is the ratification of the selection by the Audit Committee of Deloitte & Touche LLP as our independent registered public accounting firm for the current fiscal year. Are there any questions or any discussion of any of these proposals before we proceed to vote? This concludes the business items of the agenda for this meeting. I hereby declare that the polls are now open for each matter to be voted upon today. Are there any ballots to be collected? [Voting]

The polls are now closed. The votes will now be tabulated and we'll announce the preliminary results of the voting. Mr. Baker has prepared and provided to me a preliminary report of the voting on each matter and the final vote results will be included in the formal 8-K that will be filed within 4 business days after this meeting. On the motion to elect directors, a plurality of the votes cast at the meeting has been voted in favor of each of the nominees to be elected. On the motion to approve the amendment of the 2020 stock incentive plan, a majority of the votes cast at the meeting have voted in favor of approving the amendment. On the motion to ratify selection by the Audit Committee of Deloitte & Touche LLP as our independent registered public accounting firm for the current fiscal year, a majority of the votes cast at the meeting has been voted in favor of the ratification. Therefore, I hereby declare that the nominees have been duly elected as directors. The amendment to our stock incentive plan has been duly approved, and Deloitte & Touche LLP has been duly ratified as our independent registered public accounting firm for the current fiscal year. I now instruct the Secretary of the company to include the minutes of this meeting, the precise number of shares voted on each proposal. We're now available to answer any questions that any stockholder may have.

[Operator Instructions] I am showing no questions on the phone lines.

As there is no further business to come before the meeting, I declare the formal meeting -- excuse me, I declare the formal portion of the meeting adjourned. Thank you for your time and your attention.

This concludes today's conference call. Thank you for participating. You may now disconnect.