Enablence Technologies Inc. (ENA) Earnings Call Transcript & Summary

All right. Good morning, ladies and gentlemen. Welcome to the Annual and Special Shareholders Meeting of Enablence Technologies Inc. As a process point, we would ask that you please keep your line on mute and refrain from speaking unless specifically called upon by myself or the scrutineer to speak. Once the formal business of the meeting is concluded, you'll have an opportunity to ask questions. I ask that the general comments and questions unrelated to the specific matters to be voted on at this meeting to be reserved until such time. [indiscernible] to order. My name is Craig Mode, and I'm the Co-CEO and CFO of Enablence. With the consent of the Directors of Enablence, I will act as the Chairman of the meeting. I will ask that Andrew Disipio of Bennett Jones LLP to act as Secretary of the meeting. I will also ask [ Rockman Parso ] and Josette Koffyberg of Computershare to act as scrutineers the meeting. An important hosting reminder, only registered shareholders or their duly appointed proxy holders are entitled to vote at today's meeting. We have previously mailed the meeting materials. I direct that copies of the Meeting of Shareholders and the statuary declaration of mailing be kept by the Secretary for the minutes of the meeting. If there is no objection, the reading of the members of the meeting will be [indiscernible]. In accordance with the bylaws of the corporation, business may be transacted at this meeting if two persons who are entitled to vote at this meeting and holding not less than 10% of the outstanding shares of the corporation, which may be voted at the meeting, are present or represented by proxy at this meeting. Based on the preliminary scrutineers' report, there is a quorum of shareholders present at this meeting. I now declare this meeting as regularly called and properly constituted for the transaction of business. I direct that the copy of the scrutineers' report or appendix be kept as the records of the meeting. Only shareholders of record as of September 21, 2021 or their properly appointed proxy holders are entitled to speak and vote upon matters at this meeting. Each shareholder of the corporation is entitled to one vote for each share [indiscernible]. Voting on each of the matter accepted for the meeting today will take place by ballot. If you are a registered shareholder and have already submitted a proxy, it is not necessary for you to completely submit a ballot unless you would like to change your vote, in which case you may use the form of ballot that was provided to you when you arrived today. The form of ballot distributed to you includes each of the formal items of business being voted on today. You will be provided with a few moments to complete your ballot with respect to each item of business when that item of business is considered. Please do not return your ballot unless told to do so. At that time, the scrutineer will come around and collect your ballots. Once the ballot is collected, we will take a short recess to allow the scrutineer to tabulate the ballots, also to report the results of the vote. I now place before the meeting the financial statements of Enablence for: one, the fiscal year ended June 30, 2020, and June 30, 2019, together with the report of the auditors thereon; and two, 3 and 9 months ended March 31, 2021 and 2020. A copy of these financial statements has been mailed to shareholders. There are extra copies available at this meeting for anyone wishing one. Are there any questions relating to the financial statements? The next item of business is the approval of an amendment to the articles of the corporation to consolidate the issued and outstanding common shares of the corporation. The range will be 1 new common share for a number of pre-consolidation shares within a range of 50:200. The final consolidation ratio within the previously noted range will be determined by the Board of Directors of the corporation at a future date, subject to all necessary stock exchange approvals. A description of the consolidation and the full text of the consolidation resolutions are more particularly described in the circular. The Board of Directors unanimously recommend that the shareholders vote for approval of the proposed consolidation. The consolidation resolution requires the affirmative vote of at least 66 and 2/3 of the votes passed by shareholders to vote in-person or by proxy.

Mr. Chairman, I move that the consolidation be approved.

Mr. Chairman, I second the motion.

We will now proceed to the vote. The vote will be completed by ballot. Please complete your ballots regarding the consolidation. I will give you a moment to complete your ballots. [Voting]

We will now continue with the meeting. The next item of the business is the approval of a new omnibus equity incentive plan that allows the corporation to be granted awards under the omnibus equity incentive plan, all of are particularly described in the circular. I will now contain a motion on the matter, which requires the approval of a simple majority of dis-interested shareholders of Enablence.

Mr. Chairman, I move that the omnibus equity incentive plan be approved.

Mr. Chairman, I second the motion.

We will now proceed to the vote. The vote will be completed by ballot. Please complete your ballots regarding the approval of the omnibus equity incentive plan. I will give you a moment to complete your ballots. [Voting]

The pools are now closed for the consolidation, and omnibus equity incentive plan approval. Ballots will now be collected. Once all ballots have been selected, the scrutineers will tabulate the votes and provide us with an update. For health and safety reasons, please remain in your seat and maintain social distancing protocols during this time. I have received from the scrutineers the preliminary report on proxy related to the consolidation and omnibus equity incentive plan resolutions. Based on the preliminary report on proxy, further both the consolidation and the omnibus equity incentive plan resolution have been approved. The final report on ballots will be available at the end of this meeting. We will now continue with the meeting. The next item of business is the appointment of the auditor of the corporation for the ensuing year, and to authorize the directors to fix their remunerations.

Mr. Chairman, I move that MNP LLP be reappointed as the auditor of the corporation until the next Annual Meeting of the Shareholders or until their successor is appointed, and that the directors of the corporation be authorized to fix their remunerations as such [indiscernible].

Mr. Chairman, I second the motion.

We will now proceed to the votes. The vote will be completed by ballots. Please complete your ballots regarding the appointment of the auditor. I give you a few moments to complete your ballots. [Voting]

We will now continue with the meeting. The next item of business is the election of directors. The nominees of management are as follows: Derek Burney, Louis De Jong, Dan Shmitt. I will now contain a motion nominating those persons as directors.

Mr. Chairman, I nominate for election as directors of the corporation for the ensuing year, the 3 persons whose name have been read.

Mr. Chairman, I second the motion.

Are there any further nominations? If there are no further nominations, would someone please move to close nominations and to elect the directors?

Mr. Chairman, I move that the nominations be closed and that the 3 persons nominated to be elected as the directors.

Mr. Chairman, I second the motion.

We will now proceed to the vote. The vote will be completed by ballots. Please complete your ballots regarding the election of directors. I will give you a moment to complete your ballot. [Voting]

We will now continue with the meeting. In connection with the corporation's recapitalization plan, the corporation is seeking to settle its debts for permanent major shareholders. The next few items of business relates to the approval for certain issuances of common shares and warrants relating to such shares for debt settlement in connection with the recapitalization. The next item of business is the approval of the issuance of 3,559,056 common shares and 711,811 warrants in satisfaction of the indebtedness of the corporation to [indiscernible] ,[ Capital Corp. ] and Scott Larin related to the consulting services rendered by Mr. Larin during the period that Mr. Larin was an officer of the corporation. The full impact of the Larin shares for debt resolution and the background thereto are more particularly described in the circular. The Board of Directors unanimously recommend that the shareholders vote for approval of the Larin shares for debt resolution. The Larin shares for debt resolution requires the affirmative vote of at least 50% of the votes cast by shareholders who vote in-person or by proxy, excluding such commentaries held by [indiscernible], [ Capital Corp. ] and Scott Larin. As of the record date, [indiscernible], Capital Corp., and Mr. Larin held no comment share, and as such, no come shares shall be excluded from voting on this resolution.

Mr. Chairman, I move that the Larin shares debt resolution be approved.

Mr. Chairman, I second the motion.

We will now proceed to the vote. The vote will be completed by ballot. Please complete your ballots regarding the Larin share for debt settlement. I will give you a moment to complete your ballots. [Voting]

We will not continue with the meeting. The next item of business is the approval of the issuance of 4,380,373 common shares in satisfaction of the indebtedness of the corporation to Steve Wang for certain reimbursable expenses and prior wages Mr. Wang incurred during the period he was an officer of the corporation. The full impact of the Wang shares for debt resolution and the background thereto are more particularly described in the circular. The Board of Directors unanimously recommends that the shareholders vote for approval of the Wang shares for debt resolution. The Wang shares for debt resolution requires the affirmative both of at least 50% of the votes half by shareholders who vote in-person or by proxy, excluding such common shares held by Steve Wang. As of the record date, Mr. Wang held no common share, and as such, no common shares will be included from voting on this resolution.

Mr. Chairman, I move that the Wang shares for debt resolution be approved.

Mr. Chairman, I second the motion.

We will now proceed to vote. The vote will be completed by ballot. Please complete your ballots regarding the Wang shares for debt settlement. I will give you a few moments to complete your ballots. [Voting]

We will now continue with the meeting. The next item of business is the approval of the issuance of 2 million common shares in satisfaction of the indebtedness of the corporation for Louis De Jong or respect to $50,000 in bonus fees granted in December 2013, pursuant through the consulting agreement with the corporation that remains unpaid. The full text of the De Jong fee settlement resolution and the background thereto are more particularly described in the circular. The Board of Directors, with Mr. De Jong abstaining, recommends that the shareholders other than Mr. De Jong, vote for approval of the De Jong fee settlement resolution. Pursuant to the rules of the TSX Venture Exchange, the De Jong fee settlement requires the affirmative vote by least 50% of the votes passed by shareholders who vote in-person or by proxy, excluding such commentaries held by Louis De Jong. As of the record date, 6 million common shares are held by Mr. De Jong, which are being excluded from the tabulations of the De Jong fee settlement resolution approval.

Mr. Chairman, I move that the De Jong fee settlement resolution be approved.

Mr. Chairman, I second the motion.