KLX Energy Services Holdings, Inc. (KLXE) Earnings Call Transcript & Summary

Hello, and welcome to the Annual Meeting of Stockholders of KLX Energy Services Holdings, Inc. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to, Dag Skindlo, Chairman of KLX Energy Services Holdings, Inc. Mr. Skindlo, the floor is yours.

Good morning, ladies and gentlemen. It is now 9 a.m. and in accordance with the Notice of the Annual Meeting, I call the KLX Energy Services Holdings, Inc. 2023 Annual Meeting of Stockholders to order. I am Dag Skindlo, Chairman of the Board of Directors of the company. I will preside at today's meeting with Max Bouthillette, our Executive Vice President, General Counsel, Chief Compliance Officer and Corporate Secretary, will act as the secretary of the meeting. On behalf of the Board of Directors, I welcome you to the 2023 Annual Meeting. I would like to take a moment to introduce the other Board members of our Board of Directors and our other officers who are participating virtually in the meeting today. The other directors who are participating virtually in the meeting today are Chris Baker, John Collins, Gunnar Eliassen, Tom McCaffrey, Corbin Robertson and John Whates. The other senior officers and other advisers participating virtually in the meeting today are Chris Baker, President, Chief Executive Officer and Director; Keefer Lehner, Executive Vice President and Chief Financial Officer; Max Bouthillette, Executive Vice President, General Counsel, Chief Compliance Officer and Corporate Secretary. Jeff Seiders, Computershare Limited. In addition, I would like to recognize Jim Traeger and Daniel Granger, who are here as representatives of Deloitte & Touche LLP, our independent registered public accounting firm. I have appointed Jeff Seiders from Computershare Limited to act as inspector of election for the meeting. The inspector of election has taken the oath of office, which I directed to be filed with the company's records. It is important that we have an orderly meeting. We will follow the agenda and rules of conducting in carrying out the business of this meeting. Time has been allotted later in the meeting for any questions you may have concerning the matters to be voted upon this morning. After we determine whether a quorum is present and I will present the matters to be voted upon in today's meeting. The polls for Proposal 1, the amendment to the amended and restated certificate of incorporation to declassify the Board will be opened online for all stockholders who are attending the meeting online. Once voting on Proposal 1 has concluded, the polls for the remaining proposals will be opened online for all stockholders who are attending the meeting online. If you have not already voted, you may vote online at www.meetnowglobal\M9W45YM. You will need your control number to vote your shares during the meeting. Of course, if you have already voted, you need not vote again during the meeting. If you have not voted or if you would like to change your vote, you may do so online. After the formal part of the meeting has been adjourned, there will be a general question-and-answer session for questions for up to 15 minutes pertaining to the company. If any stockholders has any matters of individual concern, please call our Investor Relations department at (832) 518-4094. There are a few formalities to cover before we get into the business of this meeting. First, the secretary of the meeting has provided me with a following report on the record date, listing of stockholders, notice, quorum and matters to be considered at today's general meeting. March 13, 2023, was set by resolution of the Board of Directors as the record date for today's annual meeting. All stockholders of record or their proxy holders at the close of business on March 13, 2023, are entitled to vote at the annual meeting. A listing of stockholders as of the record date has been available at the company's offices for the last 10 days by appointment with our Investor Relations department and is available on the meeting website during the meeting. Notice of this meeting was duly given in accordance with the company's bylaws and Delaware law. We received an affidavit from Computershare Limited certifying that the proxy materials which included the notice of the annual meeting was first sent to stockholders on or about March 28, 2023. The affidavit will be filed with the company's records. The matters to be considered at this meeting are fully described in the company's proxy statement. Copies of the proxy statement are available on the company's website and at www.edocumentview.com/KLXE. The inspector of election has advised the company that based on the proxies received prior to the meeting, shares representing a majority of the voting power of the company's common stock as of the record date are present online or represented by proxies at this meeting. Accordingly, I determine that a quorum is present for the conduct of business at this meeting and the business of the meeting may proceed. Legal notice have been given, this meeting is now convened and open for the transaction of business. It is now 9:06 on May 10, 2023, and I now declare the polls for Proposal 1, open for voting, while I present the matters to be voted on during today's meeting. The items of business being submitted to stockholders for action at today's meeting are, one, the amendment to the amended and restated certificate of incorporation to declassify the Board; two, the election of 2 directors, Dag Skindlo and John T. Collins to serve as Class II directors until 2026 Annual Meeting of Stockholders or to serve as directors until 2024 Annual Meeting of Stockholders, if Proposal 1 is approved and is filed and become effective and until their successors are duly elected and qualified, subject to their earlier resignation, removal or death; three, the amendment to the amended and restated certificate of incorporation to eliminate the supermajority voting requirements to amend the company's bylaws; four, the amendment and -- the amendment to the amended and restated certificate of incorporation to eliminate the supermajority voting requirements to amend the company's certificate of incorporation; five, the amendment to the amended and restated certificate of incorporation to reflect new Delaware law provisions regarding officer's exculpation; sixth, the amendment to the KLX Energy Services Holdings, Inc. long-term incentive plan to extend the expiry date and increase the number of shares of the company's common stock that may be issued thereunder; and seven, the ratification of the selection of Deloitte & Touche LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2023. There are no other proposals to come before this meeting since management has not made any other proposals, and no other proposals were submitted by stockholders in the manner prescribed in the company's bylaws, which require that certain information concerning a stockholder proposal be provided to the company before the date of the meeting. As a reminder, if you have already submitted your proxy or voted via telephone or the Internet, you do not need to vote today. Your shares will be voted in accordance with the direction you provided. If you have not yet submitted a proxy or wish to vote on these items or wish to revoke a proxy you have previously submitted, please do so now by following the instructions on the meeting website. We will begin with the first proposal, the amendment to the amended and restated certification of incorporation to declassify the Board. Please note that if stockholders approve this proposal, we will break for 10 minutes to file the certificate of amendment with Delaware Secretary of State. Once filed, we will resume the meeting and then hold votes on the remaining proposals. We will now pause for 30 seconds to allow stockholders to vote on Proposal 1. Any votes cast today will be counted in the final tally along with the proxies previously received. [Voting]

This conclude the matters of Proposal 1 to be considered and voted upon at today's meeting. It is now 9:10 a.m. on May 10, 2023. And I now declare the polls for Proposal 1 closed. No additional ballots, proxies or votes and no changes or revocations will be accepted on this matter. The inspector of election will count the votes for Proposal 1. I have been advised by inspector of election that based on a preliminary tabulation of the votes, the amendment to the amended and restated certificate of incorporation to declassify the Board has not been approved due to insufficient shareholder participation. The meeting is now resumed. It is now 9:11 a.m. on May 10, 2023, and I now declare the polls open for voting for the following proposals. First, the election of 2 directors, Dag Skindlo and John Collins, to serve as Class II directors until the 2026 Annual Meeting of Stockholders and until their successors are duly elected and qualified subject to their earlier resignation, removal or death. The amendment to the amended and restated certificate of incorporation to eliminate the supermajority voting requirements amend the company's bylaws. The amendment to the amended and restated certificate of incorporation to eliminate the supermajority vote requirements amend the company's certification of incorporation. The amendment to the amended and restated certificate of incorporation to reflect new Delaware law provisioning regarding the officer's exculpation. The amendment to the KLX Energy Services Holdings, Inc. long-term incentive plan, to extend the expiration date and increase the number of shares of the company's common stock that may be issued thereunder, and the ratification of the selection of Deloitte & Touche LLP as a company's independent registered public accounting firm for the fiscal year ending December 31, 2023. We will now pause for 30 seconds to allow stockholders to vote on these proposals. Any votes cast today will be counted on the final tally along with the proxies previously received. [Voting]

This concludes the matters to be considered and voted upon on today's meeting. It is now 9:13 on May 10, 2023, and I now declare the polls closed. No additional ballots, proxies or votes and no changes or revocations will be accepted. The inspector of election will count the votes. I have been advised by the inspector of election that based on the preliminary tabulations of the votes, Dag Skindlo and John Collins have been elected to serve as Class II directors until the 2026 Annual Meeting of Stockholders and until their successors are duly elected and qualified subject to their earlier resignation, removal or death. The amendment to the amended and restated certificate of incorporation to eliminate the supermajority vote requirements to amend the company's bylaws has not been approved due to insufficient shareholder participation. The amendment to the amended and restated certificate of incorporation to eliminate the supermajority voting requirements to amend the company's certificate of incorporation has not been approved due to insufficient shareholder participation. Five, the amendment to the amended and restated certificate of incorporation to reflect new Delaware law provisions regarding officer's exculpation has not been approved due to the insufficient shareholder participation. Sixth, the amendment to the KLX Energy Services Holdings, Inc. long-term incentive plan to extend the expiry date and increase number of shares of the company's common stock that may be issued thereunder has been approved. The ratification of the selection of Deloitte & Touche LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2023, has been approved. The final voting results will be tallied by the inspector of election and subsequently announced in accordance with the requirements of the Securities and Exchange Commission. I am aware of no other business that should be brought before this meeting. Now that the formal annual meeting is concluded, I declare this meeting adjourned. We will now be pleased to answer any questions or address any comments you may have about the company to the extent that they do not require us to disclose material nonpublic information. We have reserved 15 minutes for questions and comments. No questions have been submitted. This concludes our meeting. On behalf of the Board of Directors and employees of KLX Energy Services Holdings, Inc., I want to thank you for attending today.

This concludes the meeting.