Invesque Inc. (IVQ) Earnings Call Transcript & Summary

Good day, everyone, and welcome to the Invesque Debentureholder Meeting. Today's call is being recorded. And now at this time, I'd like to turn the call over to Mark Lyons. Please go ahead.

Good morning, ladies and gentlemen, and welcome to the reconvened special meeting of holders of 5% convertible unsecured subordinated dentures through January 31, 2022, of Invesque Inc. My name is Mark Lyons, and I'm the Senior Vice President and Controller of Invesque. Today's meeting reconvenes the special meeting of Debentureholder held on November 2, 2021, which was adjourned to today in accordance with the trust indenture. With the consent of the meeting and having received the required consent of Computershare Trust Company of Canada as debenture trustee, I'm pleased to preside this meeting today as Chairman. The purpose of this meeting is for holders of the debentures to vote on proposed amendments to the trust indenture governing the debentures. As announced in Invest press release on November 5, 2021, the proposed amendments for consideration today were further enhanced and such enhanced amendments, if approved, will increase the interest rate from 5% to 7%, effective January 31, 2022, decreased the conversion price from USD 11 to USD 5 per share, extend the maturity date from January 31, 2022, to January 31, 2025, and permit Invesque to redeem the amended debentures in certain circumstances, including a partial redemption of USD 20 million on January 31, 2022, all as set forth in the November 5 press release. On behalf of the Board, I'd like to thank those debentureholders who have submitted their proxies in advance. In light of ongoing concerns and guidance related to the spread of COVID-19, today's meeting is also being made available by way of teleconference call. Debentureholders will not be able to vote, ask questions or otherwise participate in the meeting via the teleconference call. Debentureholders who are not in attendance in person have the opportunity to vote by proxy and to submit questions in advance of the meeting. Appropriate questions will be answered following the formal part of the meeting, if any. With the permission of the meeting, I would now like to begin with the formal matters to be dealt with at this meeting. With the consent of the meeting, I will ask Scott Higgs to act as Secretary of the meeting; and Lisa Couto and Michelle Schultz of Computershare to act as scrutineer. I've been advised that on October 5, 2021, notice calling the meeting, together with the form of proxy and the management information circular, were mailed to each debentureholder of record as of September 27, 2021. The record date for the meeting as well as today's adjourned meeting. We have received an affidavit of mailing from our debenture trustee, and I ask that the secretary keep a copy of it with the minutes. I've been provided with a preliminary scrutineers report indicating that at least 25% of the principal amount of debentures are present in person or represented by proxy, meaning a quorum is present. As such, I declare that this meeting has been duly convened and constituted. When the formal report of the scrutineer is available, it will be kept with the minutes of the meeting. In order to make the best use of our time today, certain individuals have been asked to move and second various motions. We will now proceed to the formal item of business for the meeting. This meeting has been called by Invesque in accordance with the trust indenture between the company and Computershare Trust Company of Canada dated December 16, 2016. The purpose of this meeting is to consider and, if deemed appropriate, to adopt with or without amendment an extraordinary resolution in the form attached as Appendix A to the management information circular of the corporation dated September 30, 2021, as varied as necessary to reflect items set forth in the press release of the corporation dated November 5, 2021. The extraordinary resolution to be considered by the debentureholders at this meeting is as follows: Be it resolved as an extraordinary resolution as such term is defined in the indenture that the amendments to the trust indenture dated December 16, 2016, between the Corporation and Computershare Trust Company of Canada, debenture trustee, governing the 5% convertible unsecured subordinated debentures due January 31, 2022, to increase the underlying interest rate from 5% to 7% effective January 31, 2022, being the commencement of the next interest rate accrual period. Decrease the conversion price from USD 11 to USD 5 per common share of the Corporation, representing a conversion rate of 200 common shares per USD 1,000 principal amount of amended debentures. Extend the maturity date from January 31, 2022, to January 31, 2025, and permit other than pursuant to the partial redemption of USD 20 million on January 31, 2022, the Corporation to redeem the amended debentures in whole or in part at any time after January 31, 2024, at a price equal to the principal amount thereof, plus accrued and unpaid interest to, but excluding the date of redemption. Providing that the current market price, as defined in the indenture on the date on which such notice of redemption is given is at least 125% of the conversion price, and to permit the Corporation to redeem on January 31, 2022, on a pro rata basis, USD 20 million of the principal amount of debentures outstanding, plus accrued and unpaid interest thereon, but excluding the date of redemption, which redemption will occur on January 31, 2022, all to be set forth in a supplemental trust indenture to be entered into by the Corporation and the debenture trustee substantially in the form attached as Appendix B to the circular with the above noted changes and with such minor amendments as any officer or director of the corporation may approve to hereby or approved and authorized. The Debenture Trustee is hereby authorized and directed in accordance with Section 13.11C of the indenture to agree to execute and deliver one or more supplemental indentures to the indenture, which give effect to the foregoing amendments to the indenture and all amendments incidental or ancillary there, too. The Debenture Trustee is hereby authorized and directed to execute in accordance with Section 13.11E of the indenture and to cause to be executed on behalf of the holders of the debentures or to deliver or cause to be delivered all such documents, agreements and instruments and to do or cause to be done all such other acts and things of the Corporation or its advisers shall determine to be necessary or desirable to carry out the intent of this extraordinary resolution and matters authorized hereby, such determination to be conclusively evidenced by the execution and delivery of any such document, agreement or instrument or the doing of any such actor thing. Notwithstanding that this extraordinary resolution has been passed by the debentureholders in accordance with Section 13 of the indenture. The corporation is authorized, without further notice to or approval of the debentureholders to not proceed with the transactions contemplated herein, including not entering into the supplemental indenture. Any director or officer of the Corporation is hereby authorized and directed to execute and deliver all documents and to do all the other acts and things as such individual may in his or her sole discretion determined to be appropriate from time to time to give effect to the foregoing, including, if appropriate, without further notice to the debentureholders, revocation of this extraordinary resolution at any time prior to the effective date of the supplemental indenture. Such determination to be conclusively evidenced by the execution and delivery by such individual such documents or the doing of such other acts or things. And the Debenture Trustee is hereby authorized and directed pursuant to Section 13.11E of the indenture to execute and deliver all documents and to do all their acts or things as a debenture trustee may be advised by counsel are necessary or appropriate from time to time to give effect to the foregoing such determination to be conclusively evidenced by the execution and delivery of the Debenture Trustee of such documents or the doing of such other acts or things. Approval of the extraordinary resolution requires the affirmative vote of holders of not less than 66 2/3% of the principal amount of the debentures present or represented by proxy at the meeting. I will now call for a vote on the extraordinary resolution by way of poll in accordance with Section 13.7 of the indenture. I would ask Scott Higgs to move and Adlai Chester to second a formal motion for the approval of the extraordinary resolution.

Mr. Chairman, I move that the extraordinary resolution you have just recited be approved.

Mr. Chairman, I second the motion.

The motion has been made and seconded to approve the extraordinary resolution. It is now in order to vote on the motion. As required by the indenture, vote will be taken by poll, and I now direct that a ballot be conducted. Each debentureholder proxy nominee present here today received a ballot upon signing in. The ballot can now be completed by recording your vote in respect of the extraordinary resolution by indicating in the space provided whether your vote is in favor of or against the extraordinary resolution. If there's any debentureholder proxy nominee present who has not received a ballot, please indicate by raising your hand, and we will distribute a ballot. The meeting will recess for a few moments while the ballots are being tallied. [Voting]