LivaNova PLC (LIVN) Earnings Call Transcript & Summary

Hello, and welcome to the Annual Meeting of Shareholders of LivaNova PLC. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to Mr. Bill Kozy, Interim Chief Executive Officer and Chair of the Board of LivaNova. Mr. Kozy, the floor is yours.

Thank you. Hello, and welcome to all attending LivaNova's Annual General Meeting. I'm Bill Kozy, and it is my pleasure to be speaking on behalf of the Board of Directors of LivaNova for my second Annual General Meeting as Chair of the Board and currently as Interim Chief Executive Officer. We are conducting this meeting virtually to facilitate and maximize the participation of our shareholders remotely regardless of their location in the world. This virtual meeting is a live audiocast, and you may raise questions by typing your remarks in the designated box on your screen using the message icon. To ensure that the questions raised reach us in a timely manner, please submit any questions as soon as possible. We will address pertinent questions at the end of the meeting before the polls close. When asking a question, please, first give your name and state whether you are a shareholder, proxy or corporate representative. If you are a proxy or corporate representative, please state the name of the shareholder you are representing. Please note that a copy of the agenda and the rules of conduct are located on the meeting screen. I understand from the Company's Secretary that the notice of Annual General Meeting has been sent to all shareholders and to all other people entitled to receive it and that the quorum requirements have been met. It is now just after 3:00 p.m. in London, and I am pleased to declare LivaNova's 2023 Annual General Meeting formally open. I will start by introducing the other members of the Board of Directors. On the line, we have Mr. Dan Moore, Dr. Sharon O’'Kane, Ms. Andrea Saia, Mr. Todd Schermerhorn, Ms. Brooke Story and Mr. Peter Wilver. It is my pleasure to also introduce a number of company officers. We have our Chief Legal Officer and Company Secretary, Mr. Michael Hutchinson; our Chief Financial Officer, Mr. Alex Shvartzburg; our Chief Human Resources Officer, Ms. Trui Hebbelinck; and our Senior Vice President for Corporate Development and IT, Mr. Matt Dodds. We are also joined today by representatives of PricewaterhouseCoopers LLP, LivaNova's independent registered public accounting firm in the United States, which we refer to as PwC U.S.; and representatives from our U.K. statutory auditors PricewaterhouseCoopers LLP, which we refer to as PwC U.K. These representatives will be available for questions during the Q&A portion of the meeting. Computershare, our transfer agent and registrar, is acting as scrutineer for the voting today and is being represented by Mr. Mark Cano. Now it is my pleasure to introduce Michael Hutchinson, our Chief Legal Officer and Company Secretary, who will discuss the voting procedures.

Thank you, Bill. Notice of this meeting, together with LivaNova's proxy statement and U.K. annual report and accounts, which we refer to as our U.K. Annual Report and the U.S. Annual Report on Form 10-K in each case for the year ended December 31, 2022, were posted and, in some cases, mailed to shareholders of the company commencing on April 28, 2023. Accordingly, requisite notice of the meeting has been given. Based on a preliminary report from the scrutineer of the approximately 53.9 million ordinary shares entitled to vote at the meeting, more than 43 million ordinary shares, representing 81.3% of all of the voting rights of all the shareholders entitled to vote, voted as of the start of the meeting. The final results of the vote, including the proxy votes on each of the resolutions, will be published on our website and notified through a Form 8-K filed with the U.S. Securities and Exchange Commission after today's meeting. I now give the floor back to Bill Kozy, who will present the resolutions.

There are 10 resolutions, with resolution #1 comprising separate resolutions for the election of each of the proposed Directors. Resolution #6 is a special resolution which means it requires approval by shareholders representing at least 75% of the votes cast to be passed. All other resolutions are ordinary resolutions requiring approval by a simple majority of the votes cast to be passed. The full text for each resolution is set out in the Notice of the Meeting and all are described in detail in the proxy materials, copies of which you have received. In accordance with the recommendation of the Board of Directors, I move the following resolutions for approval. Resolution 1 is to elect by separate resolutions each of the following 9 Directors for a term expiring at the AGM to be held in 2024. One, Francesco Bianchi; two, Stacy Enxing Seng; three, William Kozy; four, Daniel Moore; five Dr. Sharon O'Kane; six, Andrea Saia; seven, Todd Schermerhorn; eight, Brooks Story; and number nine, Peter Wilver. Resolution 2 is to approve, on an advisory basis, LivaNova's compensation of its named executive officers as set out in the proxy statement. This is known as U.S. Say-on-Pay. As a shareholder, you are entitled to cast an advisory vote to approve the compensation of our named executive officers as disclosed in the proxy statement. Although the vote is nonbinding, the Board values your opinion and plans to consider the outcome of the vote in establishing compensation philosophy and making future compensation decisions. Resolution 3 is to ratify the appointment of PwC USA as the company's independent registered public accounting firm for the year ending December 31, 2023. Resolution 4 is to approve the amended and restated LivaNova PLC 2022 Incentive Award Plan. Resolution 5 authorizes the Directors to allot shares in the company and to grant rights to subscribe for or to convert any security into shares in the company up to an aggregate nominal amount representing approximately 20% of the company's existing share capital, excluding treasury shares. Resolution 6 grants the Directors the power to disapply preemption rights for the allotment of equity securities subject to the passing of Resolution 5, up to an aggregate nominal amount representing approximately 20% of the company's existing share capital, excluding treasury shares. If passed, Resolutions 5 and 6 would provide the company with the ability to raise additional capital if required and continue to grant equity awards to nonemployee directors under its incentive plans. Resolution 7 is to approve, on an advisory basis, the U.K. Directors' remuneration report in the form set out in the company's U.K. annual report for the period ended December 31, 2022. The Director's remuneration report is concerned solely with the remuneration of our executive and nonexecutive directors and is required under the U.K. Companies Act. Resolution 8 is to receive and adopt the company's audited U.K. statutory accounts for the year ended December 31, 2022, together with the reports of the Directors and the auditors thereon. Resolution 9 is to reappoint PwC U.K. as the company's U.K. statutory auditor to hold office from the conclusion of this 2023 Annual General Meeting until the conclusion of the next general meeting at which the annual report and accounts are laid. Resolution 10 is to authorize the Directors and/or the Audit and Compliance Committee of the company to determine the remuneration of PwC U.K. in its capacity as the company's U.K. statutory auditor under the Companies Act. For those who have not already voted, please select the Cast Your Vote icon and vote for the resolution, against it or you may abstain from voting. You may vote either now or once you've had an opportunity to consider the ensuing Q&A. As a reminder, voting will close at the end of the meeting. Before opening the call to Q&A, I'd like to thank our employees for their dedication to the company. I have previously mentioned my appreciation for their warm welcome, and I now also want to thank them for their continued focus on our patients, performance and execution. These 3 areas underpin our dedication to serving patients worldwide and our focus on long-term innovation and shareholder value creation. As a company, we've demonstrated continued progress across the portfolio. This would not be possible without the hard work and commitment of our employees across the globe. I look forward to continuing to work alongside our experienced executive leadership team and the Board as we build upon our results, and I remain confident that we will facilitate a smooth and positive transition as we search for LivaNova's next leader. I would like now to open the floor to any questions. Please send your questions using the message icon. Mike, have we received any questions relevant to the proposals being considered?

Bill, we have not received any questions.

Therefore, I thank you for your participation during this meeting. As Mike mentioned, the results of the voting will be published on our website and notified through a Form 8-K filed with the U.S. Securities and Exchange Commission. I now declare the meeting closed at 3:12 p.m. British Standard Time. We thank you for joining us today and your continued support and ownership of LivaNova.

This concludes the meeting. You may now disconnect.