Inspired Entertainment, Inc. (INSE) Earnings Call Transcript & Summary

Good morning. It's time to convene the 2020 Annual Meeting of Stockholders of Inspired Entertainment. I'm Lorne Weil, Executive Chairman of the company, and I'll be the Chairman of the meeting. On behalf of Inspired Entertainment and the Board of Directors, I'd like to welcome you to the Annual Meeting. I call the meeting to order. Due to the unusual circumstances in which we find ourselves, today's meeting is being held virtually by means of webcast and audio conference only. Stockholders desiring to vote first at the meeting are required to follow the procedures set forth in the company's proxy statement. As in prior years, we've solicited proxies from stockholders to allow the stockholders to specify how they want the first designated as proxies to vote at the meeting. Stockholders of record have had the ability to post questions in advance of the meeting on our virtual meeting website. And if any stockholder attended the meeting by website wishes to ask a question, they may pose the question during the meeting by typing it into the field for questions on their screens and hitting submit. We will try to answer as many questions as possible. I will caution you that if any forward-looking information is discussed at the meeting is qualified by the qualifications set forth in our 2019 Form 10-K. At this time, I'd like to introduce you to the other officers and directors of the company who are attending the meeting by phone. Brooks Pierce, President and COO; Daniel Silvers, Executive VP, and Chief Strategy Officer; Stewart Baker, Executive VP, and Chief Financial Officer; and Carys Damon, General Counsel. And our outside directors: Michael Chambrello, Alexander Hoye, Ira Raphaelson, Desirée Rogers, Steven Saferin, and John Vandemore. Ms. Damon will act as Secretary of the meeting to begin the formal portion of the meeting and with few housekeeping matters to announce. A copy of notes of the annual meeting of stockholders and the proxy statement that was first sent out on about April 21, 2020, to each stockholder of record as of April 6, 2020, and filed with the Securities and Exchange Commission on April 20, 2020, has been available for review at our headquarters office. And after Damon confirms such thing, we will be appended to the minutes of this meeting. [ Jeffrey Rubin ] a representative of our outside legal counsel has been appointed to act as inspector of election. His oath as inspector has been submitted and will also be appended to the minutes of this meeting. Certified list of stockholders of record is available for inspection at the meeting upon request to the secretary of the company. As of the record date, there were 23,021,843 shares of common stock. Shares of common stock issued and outstanding entitled to cast a vote on similar number of common stock votes. Mr. Rubin has called the Stockholders present at this virtual meeting in person and has examined the proxies previously submitted in order to determine if a quorum is present at this meeting. As reported, stockholders represented at this meeting indicates that holders of shares of excess than the number necessary to constitute a quorum are present in person or represented by proxy. This report will be available for inspection throughout the meeting. It will be appended during the minutes of this meeting. A quorum being present, this meeting is declared open and to proceed with its business. In order to save time at the meeting, I'll first introduce our 4 proposals, and after the proposals have been read, moved to secondary, we will be voting the proposals. Registered stockholders who are attending the meeting online will have the opportunity to vote their shares during the meeting in accordance with the meeting instructions posted on the website, which is -- yes, that will be yes. The first matter to be considered is the election of directors of the company. Nominees receiving the highest number of affirmative votes will be elected. A discussion of this proposal can be found on Page 27 of the proxy statement. The Board of Directors have nominated and recommended the election of, and I hereby move that we elect Lorne Weil, Michael Chambrello, Alexander Hoye, Ira Raphaelson, Desirée Rogers, Steven Saferin and John Vandemore as Directors, each to hold office until the 2021 annual meeting of stockholders or until their successors are elected.

I second the motion.

The next matter to be considered is the proposal to approve on an advisory basis a compensation of the company's named executive officers or so-called Say-on-Pay. A discussion of this proposal and the text of the resolution can be found on Page 28 of the proxy statement -- information with respect to named Executive Officer compensation as described in the section of the proxy statement titled "Executive Compensation." I move that we approve the Say-on-Pay proposal.

I second the motion.

Thank you. The next matter to be considered is the proposal to vote on an advisory basis, how often we should present stockholders with the opportunity to vote on compensation awarded to our named executive office. This is sometimes called Say-on-Frequency. A discussion of this proposal with a text of the resolution can be found on Page 29 of the proxy statement. You may elect to have [ results held ] every 3 years, every 2 years or every 1 year or you may abstain. We recommend that this advisory vote be held once every 3 years. I move that we vote on this proposal.

I second the motion.

The final matter to be considered is the ratification of the appointment of Marcum LLP as the company's independent certified public accountants for the fiscal year-end December 31, 2020. This proposal can be found on Page 30 of the proxy statement. The Board of Directors favors this proposal. And I hereby move that proposal regarding the appointment of Marcum LLP as a company's independent certified public accounts for the fiscal year ending December 31, 2020, be approved.

I second the motion.

At this time, we would like to take questions relating to the proposal. Stockholders attending the meeting by means of the meeting website, if not submitted their questions yet, please do so on the website. Ms. Damon will read the questions in the name of stockholders [ for any of your ] questions. We note that the company will host a conference call and simultaneous webcast at 10 a.am Eastern Time on May 18 to discuss the company's first quarter results. We suggest that questions relating to our financial performance should be raised during that call. We also note that if you have any questions after the meeting, stockholders should feel free to contact the company directly following the closing of this meeting.

No questions have been submitted.

Thank you. We'll now move on to the vote on the proposals. As set forth, the proxy statement holders of common stock may vote for or withhold from the director nominees or against or abstain on the proposals to and for, and 1 year, 2 years or 3 years, and more than 3. We'll now proceed with the vote. Those attending the virtual meeting may vote by completing the voting field on the virtual meeting website. I declare that the polls are now open for voting. [Voting]

Okay. If everyone who wishes to vote has done so, I declare the polls closed. The inspector will proceed to count the votes.

Mr. Chairman, a plurality of the shares present at the meeting and by proxy has voted for the election of A. Lorne Weil, Michael R. Chambrello, M. Alexander Hoye, Ira H. Raphaelson, Desirée G. Rogers, Steven M. Saferin, and John M. Vandemore as Directors. Each will hold their office until the 2021 Annual Meeting of Stockholders or until their successors are elected. A majority of the shares present or represented by proxy at the meeting has voted in favor of the advisory vote on the compensation of the company's named executive officers. A plurality of the shares present or represented by proxy at the meeting has voted in favor of 3 years for the frequency of vote on executive compensation of the company's named executive officers. And finally, majority of the shares present or represented by proxy at the meeting has voted to ratify the appointment of Marcum LLP as the company's independent certified public accountants for the fiscal year ending December 31, 2020. Each of the proposals submitted to the shareholders at the 2020 annual meeting has been approved by the stockholders, and the frequency most favored was for an advisory vote on the compensation of the company's named executive officers every 3 years.

Okay. The report of the inspector of election is accepted and will be appended to the minutes of this meeting. There being no further business and having completed the business to be conducted at the meeting, I will entertain a motion that the meeting be adjourned.

I move that the meeting be adjourned.

All in favor?

Yes.

All opposed. The meeting is adjourned. I look forward to holding our next annual meeting in person. Thank you.