Irish Residential Properties REIT Plc (IRES) Earnings Call Transcript & Summary

Ladies and gentlemen, welcome to the Irish Residential Properties REIT Plc EGM. I will now hand over to your host, Mr. Declan Moylan, Chairman of Irish Residential Properties REIT Plc to begin. Mr. Mullen, please go ahead.

Good afternoon, ladies and gentlemen. I am Declan Moylan, the Chairman and an independent nonexecutive Director of Irish Residential Properties REIT Plc, and I'd like to start by welcoming you all to this extraordinary general meeting of the company. Regrettably, as a consequence of the extension of the emergency measures introduced by the Irish government in respect of coronavirus which require people to stay at home and restrict public gatherings to limit the spread of COVID-19, this EGM is taking place under constrained circumstances. Shareholders were requested not to attend the meeting in person, and it's being held with a minimum necessary quorum. Under the company's articles of association the quorum required for the meeting of 3 persons entitled to vote upon the business to be transacted. Each being a shareholder or a proxy for a shareholder or a duly authorized representative of a corporate shareholder. For the purpose of the Migration of Participating Securities at 2019, the quorum of this meeting must be at least 3 persons holding or representing by proxy at least 1/3 in nominal value of the issued shares in the company. I am here at the company's registered office at South Dock House in Dublin with my fellow Directors: Margaret Sweeney, CEO and Executive Director; and Aidan O‘Hogan, independent Nonexecutive Director and senior Independent Director. While we are the sole attendees physically present at the meeting, collectively, we hold or we represent by proxy, at least 1/3 in nominal value of the issued shares in the company, in satisfaction of the applicable quorum requirements for the meeting. As a quorum is present, and it's just after 3:00 p.m., I declare the meeting open. We're joined on the conference call facility by our other directors, Phillip Burns, Joan Garahy, Tom Kavanagh and Mark Kenney; as well as our company Secretary, Elise Lenser; Conor O'Dwyer of McCann FitzGerald, the company's legal advisers; representatives from Computershare, our registrar; and many of you, our shareholders. Notice of EGM, included in the EGM circular, was sent to shareholders and published on the company's website on the fourth of January 2021. And so with no objection, the meeting will take notice of EGM as read. Until now, the electronic settlement of trading of the company's shares has been done through a system called CREST. However, as a result of Brexit, it will no longer be possible for Irish companies to use the CREST system. And the company, like all other Irish incorporates and traded PLCs, we'll have to migrate settlement to another system based within the European Union called Euroclear Bank. This is a necessity. There's no meaningful alternative for settlement. And while in general, it will not materially affect the fundamental rights and benefits shareholders have by owning their shares, the Euroclear Bank system, which is an intermediated system is administratively and legally more complicated than the CREST system. This EGM has been convened for the specific purpose of considering and, if thought fit, approving certain resolutions relating to the replacement of CREST with the Euroclear Bank system for the electronic settlement of trading of the company's shares. It's necessary under law to get shareholder approval to make this change to the way trades in the company's shares are settled and therefore, we request your approval of these resolutions being proposed today. Failure to pass the resolutions would result in adverse consequences for shareholders and would put at risk the continued admission of the company's shares to trading and listing on Euronext Dublin. The company is required to hold this meeting by February 2021 at the latest, in order to allow that migration to happen on time, and with the rest of the Irish markets by mid-March. As such, despite COVID-19, we felt compelled to go ahead and convene and hold this meeting now, despite the difficult circumstances. The EGM circular containing the notice of this meeting set out a great deal of additional information on the settlement of migration, including questions and answers in respect of the migration and summaries of, one, how the migration will affect the rights of registered shareholders and the form through which the shareholdings are held. Two, the range of rights and services available via the Euroclear System. Three, how the rights and services accessible to uncertificated shareholders following the migration differ from those currently provided. Four, the implication -- sorry, the implementation of the migration. And five, certain tax and regulatory matters, including certain company law provisions relevant to the migration. And your attention is drawn to that information. As I noted earlier, the company requested that shareholders not attend the EGM in person. However, we ask that shareholders exercised their rights by voting in advance through the appointment of proxies. And we have also invited shareholders to follow the proceedings via this conference call. To facilitate shareholder communication, shareholders who wish to submit questions relating to items on the agenda of the AGM were invited to do so in advance by e-mailing the company's secretary. One such validly posed question, together with the company's response to it in accordance with its obligations under the Irish Companies Act of 2014 was posted on the company's website at investorrelations.iresreit.ie, in advance of the EGM. These will now be addressed to the meetings. I will read out the question together with the company's response to it. The question was, what steps have the directors of IRES have taken and will take to ensure the right, which the 99.87% of shareholders with uncertificated shares currently possess, are protected following migration. The response to the question from the company is, I believe that you're referring to the rights listed in Appendix 2 of the circular and notice of Extraordinary General Meeting issued by the company on the fourth of January 2021. The circular describes the impact of migration on holders of uncertificated shares and these -- and those Appendix 2 rights. In particular, I refer you to paragraph 1 of Part 1B of the circular which also notes as a shareholder may withdraw its IRES shares from the Euroclear system and hold them in certificated form. A summary of the process for such a withdrawal is set out in paragraph 18 of Part 2 of the circular. I now move to the formal business of the meeting where we will consider and vote on the resolutions being proposed, there were 3 resolutions in total to be proposed. Let me outline the voting procedures which we'll follow today. This year, given the emergency measures introduced by the Irish government requiring people to stay at home and restricting public gatherings and the consequences of this for shareholder attendance at the meeting, voting will be done on a poll on each of the resolutions put to the meeting. Voting by poll allows you, our shareholders, the opportunity to participate in the decision-making of the company by having your votes recorded in proportion to the number of shares you hold. Voting by poll is permitted by the company's constitution, if demanded by the Chairman of the meeting. Accordingly, pursuant to Article 66 of the current articles of association of the company, I, as Chairman, hereby demand voting by poll on the resolutions to be put to the meeting today. For the avoidance of doubt, the proxy is validly received by the company in accordance with the procedural requirements and the deadline set out in the notice of EGM will be included in the poll. For information only, the total number of proxy votes, excluding votes withheld, received by the Chairman in respect of each resolution represents approximately 67.77% of the total issued share capital of the company. We have appointed Computershare, the company's registrars, to act as scrutineers. And for convenience, I direct that the poll on all resolutions would be held at the end of this EGM. I will now formally propose each of the resolutions separately to the meeting. As the full text of each resolution is included in Pages 72 to 74 of the EGM circular, I do not intend to read out the full text of each resolution. I now move to resolution 1. Ireland enacted the Migration of Participating Securities Act 2019 and to facilitate a common procedure for the Migration of Participating Securities Act 2019 to facilitate a common procedure for the migration of securities settlement for all listed companies incorporated in Ireland, such as this company whose shares are currently held and settled through the CREST system. Resolution 1 is a special resolution to approve the company, giving us consent to the migration to Euroclear Bank's central securities depository. If resolution 1 is approved, with the final consent of the company to the migration, we're subject to the whole Irish market migration proceedings be given by a resolution of the company's Board of Directors, or a committee thereof, notice of which shall be published by a regulatory announcement. The full text of resolution 1 is set out as Item 1 on the notice of EGM. And the poll on resolution 1 will be held at the end of the meeting. I now move to resolution 2. Resolution 2 is a special resolution to amend and adopt the articles of association of the company. This is to facilitate the new arrangements required as a result of the migration and to take account of changes introduced by the Migration of Participating Securities Act 2019. A copy of the articles of association of the company, as proposed to be adopted by resolution 2, has been signed by me as Chairman of this meeting for identification purposes. The adoption of such articles of association, pursuant to resolution 2, is subject to the adoption of resolution 1 and the company's Board of Directors, or a committee thereof, adopting resolution to implement the migration as described in resolution 1. The full text of resolution 2 is set out as Item 2 in the notice of EGM. An explanation of the proposed changes to the articles of association is contained in the circular, and a redline version of the changes have been made available on the company's website. The poll on resolution 2 will be held at the end of the meeting. I now move to resolution 3. Resolution 3 is an ordinary resolution to authorize the company to take all actions to implement the migration and to appoint any person as attorney or agent for the holders of the migrating shares. By resolution 3, the company is requesting that shareholders authorize the company's Board of Directors to take certain procedural steps which are not specifically provided for in the Migration of Participating Securities Act 2019, of which the Board considers necessary or desirable to implement the migration, and to authorize the company to appoint parties to act as your attorney or agent in order to implement the migration. The adoption of resolution 3 is conditional upon the passing of resolutions 1 and 2. The full text of resolution 3 is set out as Item 3 in the notice of EGM and the poll on Resolution 3 will be held at the end of the meeting. Now let me turn to the voting procedures. In accordance with the provisions of the articles of association of the company, I now direct Computershare to conduct the poll on each of the resolutions just put to the meeting. As mentioned at the outset, votes may be given by the registered holders of ordinary shares present here in person or by proxy and entitled to vote. Every such holder has 1 vote for every ordinary share held. As Chairman, I will vote on behalf of those holders who have sent a valid proxy instruction to the company appointing the chairman of the meeting to vote on their behalf. The 3 persons present in person today, including myself, have been provided with voting poll cards, and we have cast our votes as relevant, which will be added to the valid proxy votes already received in respect of each resolution. Accordingly, I now formally declare the vote closed. The votes cast will now be examined and will be verified under the scrutiny of Computershare by reference to the registry of members and the list of authenticated proxies received by the company. Computershare will report the totals of the votes cast for and against each of the resolutions and the number of withheld votes in respect thereof. I remind shareholders that the votes withheld are not vote in law and will not be counted in the calculation of the proportion of the votes for or against a resolution. The results of the poll will take some time to be calculated. Therefore, I am closing the meeting, following which the results of the poll on all resolutions will be announced on the company's website as soon as possible later today. Ladies and gentlemen, subject to the poll results, that concludes the business of this meeting. And as there's no other business, I shall now bring the formal business of these EGM to a close. I want to express my gratitude to you for joining us today. Many thanks to you all.

Ladies and gentlemen, this concludes today's call. Thank you for joining. You may now disconnect your lines.