AGM 2020

May 21, 2020

Slides

Hello, and welcome to the Annual Meeting of Shareholders of USN Technologies. Please note that today's meeting is being recorded. Message icon at the top of your screen. Please note that your registered name will be announced along with your question during the Q and A following the formal portion of the meeting. Guests will not be able to submit questions. Please also note that all participants are in a listen only mode. It is now my pleasure to turn the conference over to Doug Bergeron. Doug, the floor is yours. Good morning and welcome to this long awaited Annual Meeting of Shareholders of USA Technologies Inc. I am Doug Bergeron, the Non Executive Chairman of the Board of the company. At this time, I call the meeting to order. Sean Feeney, our Chief Executive Officer, is also in attendance today at this annual meeting. Following the consideration of business at the meeting, we will have a question and answer period, at which time Sean and I will be available to answer questions. If you would like to ask a question, please click the message box on the annual meeting website. In addition, present today are representatives from our independent registered public accountants, BDO USA. Joseph Beach and Anthony DeAnni from BDO will be available to answer questions. As the bylaws provide, I will act as Chairman of the meeting. Richard Brand from Cavalier, Wickersham and Taft will act as the Secretary of the meeting. The Board of Directors has appointed American Stock Transfer and Trust Company to act as Judge of Election. Many shareholders have already submitted their proxies. All proxies will be voted as you have marked them. As previously announced, Don Layden has resigned from the Board of Directors and is not standing for election. So accordingly, the company has withdrawn Mr. Leiden's nomination for election as a director and any votes or proxies cast in favor of Mr. Leiden will be disregarded. If you have voted by proxy, you do not need to vote to take any further action unless you want to change your vote. If you are a registered shareholder or a beneficial shareholder who registered in advance with AST and sent in a legal proxy, as you wish to electronically at the meeting, you may vote using the control number provided to you by AST. The Board of Directors set the close of business on 04/17/2020 as the date of record for this meeting. A list of shareholders of record is available at this meeting for examination by any registered shareholder to do so. It may be accessed by following the instructions on the annual meeting website. I've been advised by the judge of election that as of the record date, there were 64,174,824 shares of common stock and 445,063 shares of Series A convertible preferred stock entitled to vote at the annual meeting and that the holders of 44,396,651 shares of common stock and 176,134 shares of Series A convertible preferred stock, together representing 71.25 of the company's voting power as of the record date are represented by person and by proxy at today's meeting. Each share of common stock is entitled to one vote and each share of Series A preferred stock is entitled to 0.1988 of a vote for each share registered in their names. We have also been informed by the judge of election that a majority of the company shares is represented here today and therefore a quorum is present and that the meeting is duly constituted and that the business of the meeting may now proceed. So I now declare the polls open for voting. The polls will continue to be open for the duration of the meeting. Each of the director candidates has been duly nominated and each of the other matters to be voted on at this meeting as listed in the agenda are considered to have already been moved and seconded to open to be open to a shareholder vote. The business of the meeting consists of consideration of the following proposals. One, the election of nine nominees to serve as directors until the twenty twenty one Annual Meeting of Shareholders and until their respective successors have been duly elected and qualified. The company's nominees are Lisa Baird myself, Douglas Bergeron Douglas Braunstein Jacob Lamb, Patricia Ulrich, Michael Pasilla, Ellen Ritchie, Anne Smalling and Shannon Warren. Two, the ratification of the appointment of BDO USA as the independent registered public accounting firm of the company for the fiscal year 2020. Three, the approval on an advisory basis of the compensation of the company's named executive officers. Four, the advisory vote on the frequency of future advisory votes on compensation of the company's named executive officers. 5A, the approval of amendments to the amended and restated articles of incorporation of the company to opt out of Subchapter E of Chapter 25 of the Pennsylvania Business Corporation Law. 5b, the approval of amendments of the amended and restated articles of incorporation of the company to opt out of subchapter F of Chapter 25 of the Pennsylvania Business Corporation Law. And six, the approval of an amendment to the company's 2018 equity incentive plan. The votes represented proxies received prior to the meeting are being tabulated by the judge of election. Any registered shareholder who registered in advance with AST and any beneficial owner holding a legal proxy who registered in advance with AST who wants to cast a ballot electronically should at this time vote electronically via the portal on the virtual meeting website. If you have already voted by proxy in advance of the virtual meeting, there is no need to submit a vote now unless you want to change your vote your prior vote instructions. Beneficial shareholders who own their shares through a bank or a broker or other custodian who did not register in advance with AST will not be permitted to vote during the virtual meeting. So thank you for all of those that have voted. We're now moving on to the question and answer period. We will open the meeting to questions. Sean Feeney and I as well as Joe and Anthony from BDO are available to answer your questions. Please note, we have not filed our quarterly report or Form 10 Q with the Securities and Exchange Commission for the third quarter and we are therefore restricted on what topics we may discuss. We cannot comment on the company's third quarter financial performance at this time. So please click on the message box on the Annual Meeting website to submit your question. I have the first question for you, Doug. Okay. What is the current situation concerning Nasdaq? And will the company be able to be added to the indexes this round? There's been no developments since the new Board has been reconstituted, but it remains an objective of the company. Second question, it was stated by Hudson they wanted to work with management to grow the company or is the company for sale? All companies are always for sale. It's the democratic corporate governance world we live in. However, our belief is that there's great opportunities with the company to grow, to improve operationally and to be the great company that we saw Hudson saw in the potential of the business when we made our investment over a year ago. Next question. Will the company be in a position to act on potential acquisitions? It's unlikely that the business would host any acquisitions until the CEO has completed his evaluation of the business, likely improvements to operational performance and the relisting takes place. The last question, will the company be fiscally responsible for ongoing lawsuits? We don't make any representations regarding litigation on calls such as this. The last question that we have so far is a repeat, which is, can you provide an update on the relisting process, which you've already the question. One last question, sorry. Why did you switch proxy companies and lock out registered shareholders? I'm sorry, that we will answer that separately. That person needs to register as with the control number and not vote as a guest. I will answer his question separately. We have no more questions at this time. Okay. Well, you for attending the Annual Meeting, everyone. We'll publish the results of the proposals considered at the annual meeting today on our website and we will file them with the SEC. AST in its capacity as the judge of elections will also furnish the secretary with a written report of the final vote count with respect to the matters voted on today, which shall be included in the minutes of the meeting. Ladies and gentlemen, thank you for your time. We will now adjourn the annual meeting. This concludes the meeting. You may now disconnect.