Rambus Inc. (RMBS) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. I'm Chuck Kissner, Chairman of the Board of Directors of Rambus Inc. It's my pleasure to welcome you to Rambus' 2021 Annual Meeting of Shareholders. Before proceeding further, let me introduce the other directors and director nominees of the company who are present with us today. Our Class II directors and Class II nominee who're standing for election are Emiko Higashi, Meera Rao, Karen Rogge, Sanjay Saraf and Eric Stang. Our Class II -- Class I directors are James Mitarotonda, Necip Sayiner, Luc Seraphin and me. I'd also like to introduce the corporate officers who are in attendance: Luc Seraphin, Chief Executive Officer and President; Rahul Mathur, Chief Financial Officer and Senior Vice President, Finance; and John Shinn, Senior Vice President, General Counsel and Corporate Secretary. Also with us today are Mandy Dhillon, who's representing PricewaterhouseCoopers LLP; and Michael Coke, who represents Wilson Sonsini Goodrich & Rosati, our outside Corporate Counsel. I'll act as Chairman of this meeting, and I've asked John Shinn to cover the agenda, to facilitate the business with the agenda and record the minutes. John?

Thank you, Chuck. This annual meeting is being held in accordance with the company's Bylaws and Delaware law. We will first address the matters described in the company's proxy statement dated March 29, 2021. We will then complete the balloting process. An announcement will be made regarding the voted results and then the official portion of the meeting will be adjourned. After that, there will be a brief company presentation. Stockholders attending the meeting may submit questions regarding the meeting or the company presentation via the virtual Q&A portal. Stockholder questions will not be answered during the formal portion of the meeting or during the company's presentation, but at the conclusion of the meeting. While we welcome full stockholder participation at the meeting, we may not be able to answer all stockholder questions to the extent we are restricted to doing so for reasons of confidentiality or if the questions are deemed inappropriate subject matter for the meeting. I have proof by affidavit that notice of this meeting has been duly given and that the notice, proxy statement and proxy were mailed on or about March 29, 2021, to all stockholders of record at the close of business on March 3, 2021, the record date for the meeting. We have at this meeting a record of stockholders as of that date. The affidavit, together with copies of the notice, proxy statement and proxy will be filed with the minutes of the meeting. We have appointed Tina Faris, Vice President and Deputy General Counsel, to act as inspector of election for this annual meeting. The inspector of election has signed an oath of office, which will be filed with the minutes of this meeting. Based on a review of the proxy card submitted prior to this meeting, the inspector of election has determined that out of an aggregate of 112,494,656 shares issued and outstanding as of the record date, the holders of at least 95,265,959 shares of common stock are present or represented at the meeting, which represents approximately 85% of all outstanding shares. That constitutes a majority of votes eligible to be cast by the holders of shares issued and outstanding. A quorum is therefore present, the meeting is duly constituted and the business of the meeting may proceed. I will now briefly describe the voting procedures. You may vote by proxy and by online ballot. Each holder of common stock is entitled to 1 vote for each share of common stock held of record at the close of business on the record date. If you have previously submitted your proxy and you do not intend to change your vote, it is not necessary that you submit another proxy or vote online. Your vote will be counted. If you are eligible to vote and have not submitted your proxy or if you want to change your vote, please vote online now. I will now announce the preliminary results of the voting at the end of the meeting. It is now approximately 9:04 a.m., and the polls for each matter to be voted on at this meeting are now open. The first item of business is the election of directors. The company's Board of Directors has 8 members and is divided into 2 classes, each with an overlapping 2-year term. There are 4 Class I directors, 4 Class II directors and 1 Class II Director Nominee. As indicated in the company's proxy statement, the following 5 individuals have been nominated by our Board to serve as Class II directors: Emiko Higashi, Meera Rao, Karen Rogge, Sanjay Saraf and Eric Stang. 4 of these nominees are currently serving as directors of the company, and Karen Rogge is a Director nominee. Directors elected at today's meeting will hold office until the 2023 Annual Meeting of Stockholders or until their successors are duly elected and qualified. Pursuant to the notice of this annual meeting and the proxy statement dated March 29, 2021, the proxies solicited by the Board of Directors will be voted in favor of these nominees. The company's bylaws require that each director be elected by the majority of votes cast with respect to such director in uncontested elections. The Board of Directors, after taking into consideration the recommendation of the Corporate Governance and Nominating Committee of the Board, will determine whether or not to accept the pretendered resignation of any director nominee, who receives a greater number of votes against his or her election than votes for such election. There are no cumulative voting rights in the election of directors. Stockholders as of the record date may vote their shares for or against some, all or none of the nominees. The next item of business is to ratify the appointment of PricewaterhouseCoopers LLP, PwC, as independent registered public accounting firm for the company for the fiscal year ending December 31, 2021. The Audit Committee of the Board recommended to the Board of Directors that PwC be appointed as independent registered public accounting firm. As our independent registered public accounting firm, PwC would audit our consolidated financial statements for the fiscal year ending December 31, 2021, and perform other audit-related or nonaudit services as described in the proxy statement. The Board approved the selection of PwC as independent registered public accounting firm for the fiscal year ending December 31, 2021, and is asking the stockholders for ratification of the selection. If the stockholders do not approve the selection of PwC as independent registered public accounting firm, the Board and Audit Committee will reconsider the appointment. The Board of Directors recommends that stockholders vote in favor of this proposal. Approval requires the affirmative vote of the holders of the majority of the votes cast. Abstentions have the same effect as a negative vote. Brokers have the discretion to vote any uninstructed shares. However, broker nonvotes are not considered votes cast. Mandy Dhillon is present from PwC and will address any questions that we have received with respect to this proposal. The next item of business concerns the nonbinding advisory vote to approve named executive officer compensation. This proposal seeks the approval of the compensation of our named executive officers as disclosed in our proxy statement and specifically in the compensation discussion and analysis section. The Board has recommended a vote in favor of the compensation of our named executive officers as described in the proxy statement. Approval requires the affirmative vote of the holders of the majority of the votes cast. Abstentions have the same effect as a negative vote. Broker nonvotes are not considered votes cast. If you have not voted and intend to vote, please do so now online. You must submit your vote in order for it to be counted as the polls will close momentarily. The inspector of election may not accept ballots, proxies or votes or any changes or revocations submitted after the closing of the polls. It is now approximately 9:08 a.m. The polls for each matter to be voted on at this meeting are now closed. No additional ballots, proxies or votes and no changes or revocations will be accepted. The proxies and ballots have been tabulated by the inspector of election. The inspector of election has provided me with a preliminary report on the voting results. With respect to Proposal 1, the 5 nominees, Emiko Higashi, Meera Rao, Karen Rogge, Sanjay Saraf and Eric Stang were each elected with the majority of the votes cast and will hold office until the 2023 Annual Meeting of Stockholders or until his or her successor is duly elected and qualified. With respect to Proposal 2, the appointment of PwC to act as the company's independent registered accounting firm for the fiscal year ending December 31, 2021, has been ratified by a majority of the shares present in person or by proxy at this meeting. With respect to Proposal 3, a majority of the votes cast have voted in favor of the advisory vote on executive compensation. The final votes -- results of voting, including any ballots or proxies recorded during this meeting, will be set forth in the report of the inspector of election and will be included in the minutes of the meeting. The final results will be reported in a Form 8-K to be filed with the SEC.

Thank you, John. Having reached the end of the agenda, this annual meeting of stockholders is now adjourned. Thank you for your attendance. We'll now proceed with our company presentation.

Thanks, Chuck. Before we go any further, I would like to note that during the presentation, we may make forward-looking statements regarding future events or the future financial performance of the company, which involve risks and uncertainties. Such statements are only predictions and actual events or results could differ materially from those predictions due to a number of risks and uncertainties. I refer you to the documents we file with the Securities and Exchange Commission, specifically the company's annual report on Form 10-K/A filed March 29, 2021, including the risk factors contained therein. These documents contain and identify important factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. With the formal business of the meeting now completed, I turn the meeting back over to Luc for a presentation on the company.

Thank you, john. 2020 was a very successful year for Rambus, and there are a number of industry and technology trends aligning to further the tremendous opportunity for the ongoing profitable growth of the company. The exponential rise in data usage, the ongoing shift to the cloud and the widespread advancement of artificial intelligence across almost all markets continue to drive demand for high-performance infrastructure. And creating fast and safe connections remains one of the most mission-critical design challenges for these systems. As an industry pioneer with over 30 years of advanced semiconductor experience in interconnect technologies, Rambus is ideally positioned to address these challenges of accelerating and protecting data. We are a leader in high-performance memory subsystems, providing chips, IP and innovations that maximize the performance and security in data-intensive systems. Our strategic priorities are to focus our product portfolio and research around our core strength in semiconductors, to optimize our operational efficiency and to leverage our strong cash generation to reinvest for growth. These priorities are central to the company and enable Rambus to further our position as a global semiconductor leader in memory buffer chips, high-speed interfaces and embedded security. Rambus products and technology are at the heart of some of today's fastest growing markets. Whether in the cloud, at the edge or in your hand, real-time and immersive applications depend on data transfer speed and trust. Rambus products and innovations deliver the increased bandwidth, capacity and security required to meet the world's data needs and drive ever greater end user experiences. In closing, we're well positioned for profitable growth, and I'm excited about the many opportunities this year and beyond. The health and safety of our global workforce, our customers and partners remain our top priority. We approach people, culture, diversity and ESG with the same level of passion and dedication as our technology leadership, profitability and capital investments. I want to thank all of you for attending today's meeting and hope each of you stay safe and healthy. We very much appreciate your attendance. And as always, thank you for your support. I'll now ask Rahul Mathur, our CFO, to facilitate answering any questions from our stockholders at this time.

Thank you, Luc. There are no questions at this time. This concludes our meeting. Thank you again for attending, and you are free to disconnect.