Surge Energy Inc. (SGY) Earnings Call Transcript & Summary

Hello, and welcome to the 2024 Annual Meeting of Shareholders of Surge Energy, Inc. Please note that this meeting is being recorded. [Operator Instructions] It is my pleasure to introduce the Chair of the Board of Directors of Surge Energy, Inc.; Mr. James Pasieka. Mr. Pasieka, the floor is yours.

Good afternoon, ladies and gentlemen, welcome to the Annual General Meeting of the holders of common shares of Surge Energy, Inc. My name is James Pasieka, and I'm Chair of the Board of Directors of Surge. Joining us online are the other directors of the corporation, including Paul Colborne, who's, of course, also the President and CEO of Surge. In addition, we have Robert Leach, Marion Burnyeat, Allison Maher; Dan O'Neill, Daryl Gilber, Murray Smith; and Michelle Gramatke. We also have other members of our executive management team present, Murray Bye, Chief Operating Officer; Jared Ducs, Chief Financial Officer; and Derek Christie, Senior Vice President, Exploration. So now we will proceed with the formal business of the meeting. In order to have the meeting proceed efficiently, certain individuals have been asked to move and second the motions, which are to be called for in the notice of meeting. This is not intended to limit in any way your right to participate in the meeting. Any proposed amendments or objections to a motion will need to be submitted as questions. All proposed amendments or objections will be addressed during the meeting, provided that they are submitted during the period when polls are open. There will be opportunities for shareholders to ask questions specific to each resolution on the webcast. [Operator Instructions] We will address questions that directly relate to a particular motion at the appropriate time of the meeting. For questions of a more general nature, not relating to proposed amendments or objections, we request that you e-mail Paul Colborne, our CEO; and Paul's e-mail address is [email protected] with your question, and we will endeavor to answer it as soon as possible following the conclusion of the meeting. Please note that only holders of shares of the corporation of record at the close of business on March 28, 2024, or their duly appointed proxy holders are entitled to participate in and vote at this meeting. Voting during this meeting can only be done through our virtual voting platform on the webcast. Click a vote tab at the top right of the webcast page and a separate browser window will open. If prompted to do so, you can register to vote by entering your control number, which you would have previously received as your user name and entering surge2024, all in lower case, as your password. Please note that the password is case-sensitive. So it's all lower case. The polls are now open. The polls will be open for all resolutions at the same time. Voting can be completed at any time from now until the end of the formal business of the meeting. Thank you to those of you who have already voted. If you have already voted in your -- in advance of the meeting and do not wish to change your vote, then you need to do nothing. For those who have not yet voted, we encourage you to vote now. So let's move on to the formal part of the meeting, and we're going to address the appointment of secretary and scrutineers. I'm going to call the meeting to order. I request that Michael Bennett, the Corporate Secretary of Surge act as Secretary of the meeting; and Gloria Gherasim of Odyssey Trust Company to act as scrutineer. Notice of Meeting, proof of mailing of the Notice of Meeting, information circular and form of proxy to the registered shareholders of the corporation has been filed with me by the Secretary. Unless there are any objections, I will dispense with the reading of the notice of meeting and direct that a copy of the proof of mailing be appended to the minutes of the meeting. Now the preliminary scrutineer's report has been received, and it shows that the required threshold for a forum at this meeting has been met. I direct that a copy of the scrutineers' report be kept with the minutes of the meeting. Accordingly, I declare that the meeting is regularly called and properly constituted for the transaction of business. So let's get to the voting. There are 4 items of business to consider at today's meeting: the fixing of the number of directors to be elected, the election of directors, the approval of the issuance of shares pursuant to unallocated share awards under Surge's Stock Incentive Plan and the appointment of auditors. We will conduct the votes on each matter before us by electronic ballot. Now let's, first of all, move to the consideration of the financial statements. This is the first item of business and that is the presentation of the financial statements of the corporation for the fiscal period ended December 31, 2023, and the report of the auditors thereon. The financial statements and auditor's report were mailed to each shareholder of the corporation who is entitled to receive them and have been posted on the corporation's website and filed on SEDAR. Shareholders have, therefore, had an opportunity to review these documents. Therefore, we will dispense with the reading of the financial statements and the auditor's report. As no action is required to be taken by the shareholders on these financial statements, I now declare that the financial statements of the corporation for the fiscal period ended December 31, 2023, and the report of the auditors thereon have been received by the shareholders as submitted to this meeting. Now the next item of business is the fixing of the number of directors for election at the meeting. In the information circular, it was proposed that 9 individuals be nominated for election to the Board of Directors. I would request a motion that the number of directors for the ensuing year be set at 9.

Mr. Chair, my name is Stephanie McNeill, and I am a shareholder. I move that the number of directors for the ensuing year be set at 9.

Mr. Chair, my name is Dan Kelly, and I am a shareholder. I second the motion.

You have now heard the motion. I will ask the Secretary, Michael Bennett, to please advise if any questions specific to this motion were submitted.

Mr. Chair, no questions specific to this motion have been submitted.

Okay. Thank you. Unless we receive any objections otherwise, we will proceed with the vote. Please record your vote now, remembering that if you have already voted in advance and do not wish to change your vote, no further action is required. [Voting]

I'm going to continue on the election of Board of Directors. It's now in order to proceed with the election of the directors of the corporation. The information circular contains the names of management's proposed nominees to the Board of Directors, which are James Pasieka, myself, Marion Burnyeat, Paul Colborne, Daryl Gilbert, Michelle Gramatke, Rober Leach, Allison Maher, Dan O'Neal and Murray Smith. The nominations, which have been made are in order as there are no further nomination, I declare the nomination is closed. Since the number of nominees does not exceed the number of directors to be elected by the shareholders, I request a motion that the nominees be elected as directors of the corporation to hold office until the next Annual Meeting of Shareholders or until their successors are elected or appointed.

Mr. Chair, my name is Stephanie McNeill, and I am a shareholder. I move that the nominees be elected as directors of the corporation to hold office until the next Annual Meeting of Shareholders or until their successes are elected or appointed.

Mr. Chair, my name is Dan Kelly, and I am a shareholder. I second the motion.

Thank you. I will now ask Michael Bennett, our Secretary to please advise if any questions specific to this motion were submitted.

No questions specific to this motion, Mr. Chair.

Thank you. And unless we receive any objections otherwise, we'll proceed to the vote. Again, please record your vote now, remembering that if you have already voted in advance and do not wish to change your vote, no further action is required. [Voting]

We will now proceed with the next item of business being the approval of the issuance of the common shares of the corporation issuable pursuant to unallocated awards under the stock incentive plan. Further information concerning this matter is set forth under Item 4, approval of unallocated awards under stock incentive plan in the information circular. In order to be effective, this resolution must be approved by a majority of the votes cast at the meeting. The full text of the resolution is set out on Page 15 of the information circular. Unless there are any objections, I will dispense with the reading of the resolution. May I please have a motion with regards to this matter.

Mr. Chair, my name is Stephanie McNeill, and I am a shareholder. I move that the ordinary resolution set forth on Page 15 of the Corporation's information circular dated March 28, 2024, respecting the approval of the shares issuable pursuant to unallocated awards under our stock incentive plan be approved.

Mr. Chair, my name is Dan Kelly, and I'm a shareholder. I second the motion.

Thank you. You have all heard the motion. I'll ask the Secretary, Michael Bennett, to please advise if any questions specific to this motion were submitted.

No Mr. Chair. There were no questions.

Thank you. As there been no questions on this motion. And unless we receive any objections otherwise, we will proceed with the vote. Please record your vote now. Again, remembering that if you have already voted in advance and do not wish to change your vote, no further action is required. [Voting]

We will now proceed with the final item of business being the appointment of auditors. May I please have a motion with regards to the appointment of the auditors.

Mr. Chair, my name is Stephanie McNeill, and I am a shareholder. I move that KPMG LLP, chartered accountants, be appointed as the auditors of the corporation until the next annual meeting or until a successor is appointed and that their numeration be fixed by the Board of Directors.

Mr. Chair, my name is Dan Kelly, and I am a shareholder. I second the motion.

You have all heard the motion. I will now ask Michael Bennett, our Corporate Secretary, to please advise if there are any questions specific to this motion were submitted.

Mr. Chair, I am pleased to advise that no questions were submitted specific to this motion.

Okay. As there's been no questions or comments and unless we receive any objections otherwise, we will proceed with the vote. Please record your vote now remembering again that if you have already voted in advance and do not wish to change your vote, no further action is required. [Voting]

I will now provide the preliminary results of the voting. I have now received the preliminary voting results from the scrutineers and can advise that each of the motions brought before the meeting has passed by a majority of the votes cast. Accordingly, I declare each of the resolutions considered at today's meeting as carried. The exact number of votes cast in respect of each matter voted on at the meeting will be filed on SEDAR and also will be made available on our website. So thank you again to all shareholders and proxy holders for your attendance today. As there is no further business to be brought before the meeting, may I have a motion to terminate the formal part of the meeting, please?

Mr. Chair, my name is Stephanie McNeill, and I am a shareholder. I move that the meeting be terminated.

Mr. Chair, my name is Dan Kelly, and I am a shareholder. I second the motion.

I will now ask our Corporate Secretary, Michael Bennett, to please advise if any questions specific to this motion were submitted.

One last time, Mr. Chair. No questions were submitted specific to this motion.

Thank you. As there's been no questions or comments, I declare the motion carried and this meeting to be concluded. Thank you, everyone who's participated. Thank you again.