ECN Capital Corp. (ECN) Earnings Call Transcript & Summary

Hello, and welcome to the Special Meeting of Shareholders of ECN Capital Corp. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn the meeting over to Mary Beth Koenig. Ms. Koenig, the floor is yours.

Thank you. Good morning. My name is Mary Beth Koenig. I am the Chief Legal Officer, General Counsel and Corporate Secretary of ECN Capital Corp. I would like to provide the usual caution that to the extent we make forward-looking statements about our future plans, business or prospects in the course of today's meeting, any such statements are based on management's beliefs and opinions and are subject to risks and uncertainties that may cause actual results to vary. I would direct you to the detailed discussion of risk factors set out in our annual information form and our most recent MD&A and in our management information circular. I will now turn the meeting over to our Chairman, Bill Lovatt.

Thank you, Mary Beth. Good morning, ladies and gentlemen. My name is Bill Lovatt, I'm Chairman of the Board. We have members of our Board of Directors and management in attendance virtually today. With your consent, I will serve as Chair of today's meeting. In light of the continuing COVID-19 pandemic and government recommendations and to mitigate health and safety to our communities and shareholders, employees and other stakeholders, we're holding today's meeting in a virtual-only format, which is accessible to all registered shareholders and duly appointed proxy holders with a control number, regardless of physical location, to participate and vote. We look forward to meeting you again in person when it will be safe and permitted to do so. Our goal is to replicate as best we can the experience you would have if we were meeting in person. The individuals who will be speaking today are not all in the same physical location. For this reason, I may pause from time to time to allow coordination from the various locations. I will also pause at certain points during the meeting to provide an opportunity to vote or to respond to the questions on the mentioned -- presented motion. I will now call the meeting to order. I will preside as Chair of the meeting, and I will ask Mary Beth Koenig to act as Secretary of the meeting. We have only 1 item of formal business to conduct today: the Stated Capital Reduction Resolution being the special resolution to approve a reduction of the stated capital account of the corporation's common shares by an aggregate amount equal to $1,010,500,000. The purpose of this resolution is to allow for the tax-efficient distribution to shareholders of the net proceeds from the sale of ECN's Service Finance Company subsidiaries to Truist Bank. The transaction was previously announced by ECN on August 2021. We expect the vast majority of all votes have been cast in advance of the meeting by proxy. That said, registered holders and duly appointed proxy holders who have been issued control numbers will be allowed to vote online at the meeting in accordance with the instructions to be provided. Registered shareholders and duly appointed proxy holders with a control number can submit questions on the Stated Capital Reduction Resolution by accessing the Q&A tab, typing your question into the box at the bottom of the screen and then pressing the Send button. Relevant questions will be addressed prior to voting on the stated capital reduction resolutions. Questions that are similar or repetitive will be grouped together and addressed as a single response. If we are unable to answer your question during this meeting or your question is not specifically related to the Stated Capital Reduction Resolution, a member of our team will follow up with you after the meeting as appropriate. Questions relating to individual matters will be addressed personally by a member of our team following the meeting. I hereby appoint Yasir Zaidi of Computershare Investor Services to act as scrutineer for the meeting. I confirm that the notice of meeting, together with the formal proxy and management information circular, have been sent to each Director of the corporation, the auditors of the corporation and each requesting shareholders of common shares of the corporation as of October 26, 2021, the record date for this meeting. The scrutineer has provided me with the preliminary report regarding shareholder attendance at the meeting. The scrutineer reports that there are present, at this meeting in person or by proxy, 56 shareholders holding 166,378,480 common shares. This represents more than 68% of our outstanding common shares. Based on the preliminary report from the scrutineer of proxies received, the Stated Capital Reduction Resolution has received more than 99% of votes in favor. Accordingly, for expediency, we will move through the motions, the Stated Capital Reduction Resolution and any relevant questions quite quickly. I declare that the requisite quorum of shareholders is present, and I declare that the meeting is duly and properly constituted for the transaction of business. I direct that the confirmation of mailing of the notice of the meeting received from Computershare and the scrutineer's complete report on attendance be annexed to the minutes of the meeting as a schedule. We will now move to the Stated Capital Reduction Resolution, our sole formal item of business at today's meeting. As described in the management information circular sent to shareholders with the notice of this meeting, shareholders are asked to approve the Stated Capital Reduction Resolution being the special resolution to authorize a reduction of the stated capital account of the common shares by an aggregate amount equal to $1,010,500,000 for the purpose of distributing such amount to holders of common shares by way of a return of capital. The full text of the Stated Capital Reduction Resolution is set out in Schedule A to the management information circular. The Stated Capital Reduction Resolution is a special resolution that requires approval by not less than 2/3 of the vote cast by holders of the common shares represented by this meeting in person or by proxy. May I have a motion on the special resolution?

My name is Mary Beth Koenig, and I so move.

Thank you, Mary Beth. May I have the motion seconded?

Mr. Chairman, my name is [ David Taswell ], and I second the motion.

Thank you, David. Before I call for a vote on the motion, have any questions related specifically to this item been received?

Mr. Chairman, this is the moderator, Michael Hickey. I can confirm that we have not received any questions from shareholders specifically on this item.

Thank you, Mr. Hickey. I will conduct the vote on the matter before us by online ballot. The poll relating to this specific motion will close in 15 seconds. [Voting]

I confirm the polls are now closed. Based on the preliminary voting results, I declare the motion carried. An update on the Service Finance transaction sale. All necessary licensing and regulatory approvals for the SFC transaction have now been received, and the SFC transaction is now scheduled to close on December 6, 2021. Following the closing of the SFC transaction, the company intends to distribute substantially all of the net proceeds of the Service Finance transaction of approximately $1.82 billion to shareholders. And that concludes the formal business brought before the meeting. There being no further business, I wish to thank you for attending, and I now declare this meeting to be terminated. Thank you for your attendance and participation at today's meeting, and we look forward to updating you following the completion of the sale of Service Finance to Truist.

This concludes the meeting. You may now disconnect.

Thank you.