SWK Holdings Corporation (SWKH) Earnings Call Transcript & Summary

Hello, and welcome to the Annual Meeting of Stockholders of SWK Holdings Corporation. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to Winston Black, Chairman and CEO of SWK Holdings Corporation. Mr. Black, the floor is yours.

Thank you, Nikka. Good afternoon, ladies and gentlemen. I'm Winston Black, Chairman of the Board and CEO of SWK Holdings Corporation. I'd like to welcome you to the 2021 Annual Meeting of Stockholders. It is now 4:03 p.m., and I'd like to call the meeting to order. I'd like to begin by introducing certain representatives of the company who are in attendance at the meeting. First is David Earhart, our General Counsel and Secretary. Mr. Earhart will act as secretary of the meeting. It is also my pleasure to introduce the members of our Board and senior management who have joined us today. First is Blair Baker, President of Precept Capital Management, a leading investment management company based here in Dallas; Dr. Aaron Fletcher, the President of Bios Research and Managing Partner of Bios Partners, a venture capital firm focused on investment in early-stage and growth-stage biotech and medical device companies; Chris Haga, a private investor and Portfolio Manager and Head of Strategic Investments at Carlson Capital; Marcus Pennington, a Director and investment professional at Carlson Capital; Ed Stead, a private investor and former General Counsel of Blockbuster and Apple Computer; Michael Weinberg, a private investor and former Chief Operating Officer of Carlson Capital; Charles Jacobson, our Chief Finance Officer and a partner of CFGI; Brannon Morisoli, our Director on the Investments team; and Michael Miner, a senior analyst on the Investments team. This meeting is for the company's stockholders and guests. Each of you have registered at the webcast portal as you join the meeting. On the webcast dashboard, you can download the agenda for the meeting, including the rules of conduct for the meeting. To conduct an orderly meeting, we request that you abide by those rules. [Operator Instructions] If the Chairman or secretary elects to answer the question on the webcast, he will repeat the question for the webcast audience, and we'll address it. Thank you for your cooperation with these rules. I would now like to call out Mr. Earhart to present certain items in connection with the holding of this meeting.

Thank you, Mr. Chairman. The Board of Directors fixed May 28, 2021, as the record date for determining stockholders entitled to receive notice of and to vote at this meeting. A complete list of stockholders of the company entitled to vote at this meeting has been kept on file at the office of our transfer agent and at the office of the company, subject to inspection by stockholders. The notice of meeting and proxy statement and the 2020 annual report on Form 10-K and Form 10-K/A were mailed to stockholders of record beginning June 7, 2021. An affidavit as to the mailing of such material will be filed with and made a part of the minutes of this meeting. As stated in the notice, the purpose of this meeting are as follows: first, to elect 7 directors to serve until the 2022 Annual Meeting; second, to ratify the appointment of BPM LLP as the company's independent auditors for 2021; third, to approve on an advisory basis the compensation paid to certain executive officers; and finally, to transact any other business that may properly come before this meeting. Brannon Morisoli has been appointed as inspector of elections and has taken the oath of office, which will be filed with the minutes of the meeting. He has submitted the report as follows. There were outstanding on the record date a total of 12,796,143 shares of common stock. Holders of approximately 89% of the outstanding shares are present in person or by proxy. Accordingly, Mr. Chairman, a quorum is present.

On the basis of the secretary's report, the meeting is duly convened. We will now proceed with the voting on the 3 items of business described in the proxy statement. The polls are now open. Persons who have not voted by proxy or who wish to change their vote from that previously recorded, you could change your vote -- or change your vote through the webcast portal. Mr. Earhart, would you please present the first item?

The first item of business today is the election of directors. All directors will be elected for service annually. Our entire Board is comprised of 7 seats, and all 7 directors are up for election today. Our Board of Directors has nominated Blair Baker, Winston Black, Aaron Fletcher, Chris Haga, Marcus Pennington, Ed Stead and Michael Weinberg for election as directors, each to hold office for a term to expire at the 2022 Annual Meeting and until a successor has been elected and qualified. Information about the nominees is set forth beginning on Page 3 of the proxy statement. The nominees receiving the highest number of votes of shares present in person or by proxy at this meeting will be elected as the directors.

Because the company did not receive notice of any additional nominations prior to the meeting as required by our bylaws, I declare the nominations closed. [Operator Instructions] Seeing none. If there's no further discussion, Mr. Earhart, please present the second item.

The next item of business is the proposal to ratify the Audit Committee's appointment of BPM as our independent registered public accounting firm for the fiscal year ending December 31, 2021.

Information regarding our auditors can be found beginning on Page 9 of the proxy statement. [Operator Instructions] There's no further discussion. Mr. Earhart, please present the third item.

The next item of business is the proposal to approve on an advisory basis the compensation of certain executive officers.

Information regarding the compensation paid to our executives can be found beginning on Page 8 of the proxy statement. The Board recommends a vote for the proposal for the reasons set forth on Page 14 of the proxy statement. [Operator Instructions] Again, those of you who have previously delivered your proxy do not need to take any further action unless you desire to change your vote. If anyone wishes to vote during this webcast, please vote through the webcast portal. The ballots will be automatically tabulated by Computershare during the meeting. Again, in order to be eligible to vote during this virtual meeting, you must either have been a record holder of stock as of May 28, 2021, or have a legal proxy from a record holder of stock as of May 28, 2021 and have registered for the webcast using your proxy control number and meeting password. [Voting]

The polls for these matters to be voted on this meeting are now closed, and the votes will be tabulated. The next item on the agenda is the preliminary report of the inspector of elections. Any ballots collected before the polls closed and are reflected in the preliminary report will be reflected in the final report of the inspector of elections. Mr. Earhart, please present the preliminary report.

Mr. Chairman, the inspector of election has presented his preliminary report. He has determined that each nominee received in excess of 90% of the votes cast for the election of the directors. The inspector also determined that the ratification of the appointment of BPM has been approved by the affirmative vote of at least 99% of the total number of shares represented and entitled to vote. And the advisory vote to approve the compensation to certain executives has been approved by the affirmative vote of at least 92% of the total number of shares represented and entitled to vote.

Based on that preliminary report, I declare that Blair Baker, Winston Black, Aaron G.L. Fletcher, Chris Haga, Marcus Pennington, Edward Stead and Michael Weinberg are elected as directors, and the appointment of BPM LLP for 2021 is ratified. The Board will take under advisement the shareholder advisory vote on the executive compensation. This concludes the formal part of the meeting. I declare the meeting adjourned. Operator, we are ready to open the floor to questions. [Operator Instructions] Seeing no questions. Our program has now concluded. Thank you for attending today's meeting and for continued support of the company.

This concludes the meeting. You may now disconnect.