Omni Bridgeway Limited (OBL) Earnings Call Transcript & Summary

Well, good afternoon, ladies and gentlemen, and welcome to the Virtual Annual General Meeting of Omni Bridgeway Limited for 2020. My name is Michael Kay, and I'm the Chairman of Omni Bridgeway. This is the sixth year I've had the privilege to chair your company's AGM. As we have some participants joining online via webcast and some via telephone, we understand you may experience a slight delay in transmission, for which we apologize in advance. In the unlikely event we experience any technical issues, we will need to seek a short adjournment. And if it should occur, we will, of course, advise you accordingly. Before we commence with the formal business of this meeting, I'd like to take this opportunity to introduce to you my fellow directors: Andrew Saker, Managing Director and CEO; Hugh McLernon, Executive Director; Michael Bowen, Non-Executive Director; Karen Phin, Non-Executive Director; Christine Feldmanis, Non-Executive Director; and Raymond van Hulst, Executive Director and the Managing Director of our European business. Our Group Chief Financial Officer, Stuart Mitchell, is also in attendance. Jeremy Sambrook, our Company Secretary and Group General Counsel, is unwell today and unable to attend. In his place is Alexandra Daniels, our Assistant Company Secretary. The company's auditor is Ernst & Young, Robert Kirkby and Ms. Fiona Drummond from Ernst & Young are here in attendance and will be available to answer questions concerning the company's financial statements. Representatives from the company's share registry, Link Market Services Limited, for overseeing the registration process and are responsible for the recording of all voting with respect to the meeting, are also in attendance. Today's meeting is being held virtually through an online meeting platform powered by Link Market Services, and this allows shareholders and proxies to attend the meeting virtually and the ability to ask questions and submit votes online. Please note the meeting is being recorded. Before moving to the formal business of the meeting, I'll take the opportunity to give you a brief overview of the 2020 financial year. I'll then invite our CEO and Managing Director, Andrew Saker, to present you his thoughts on FY '20 and his plans for the future of your company. I'll now deliver my address. Before sharing my thoughts on the financial year of 2020, I want to touch upon 2 issues. The first is the announcement by our Founder, Hugh McLernon, that he is intending to step down in 2022. Hugh is not only our Founder but also, on most people's reckoning, the founder of an industry that now exists across the globe. Founding a successful company is beyond the abilities and courage of most of us. Founding an industry is very rare indeed. There will be plenty of time and opportunity over the next 12 to 18 months to acknowledge and celebrate Hugh's contribution and to tell the story about founding and the rise of a new industry. However, given his recent announcement, it is right to thank him this afternoon at this AGM for the foresight, determination and effort that has employed many people around the world, enabled many litigants to get access to justice that could not otherwise afford it and rewarded shareholders through growing a business from scratch to around $1 billion. Congratulations on a wonderful career, Hugh. And on behalf of all of us, staff, customers and shareholders, thank you for the opportunities and the rewards you've given us across the years and across the globe. The second issue of note is that 2020 saw the completion of our 5-year strategic and business plan that was adopted by the Board in 2015. Our planning cycle is longer than most companies and reflects the fact that the average cycle time of an investment is around 3 years. Shareholders will recall that the twin themes of the 2015 plan were the seizing of opportunity in a new industry that was gaining a foothold in many jurisdictions around the world and the diversification of balance sheet and geographical concentration risk. In 2015, most of our investments were in Australia. And the risks associated with -- and capital required for those investments were almost entirely on our balance sheet. It was clear that if we were to take the emerging global opportunities, we'd need to find some other sources of nonrecourse capital and, thus, improve our risk-adjusted returns. Our CEO, Andrew Saker, and his management team have done a superb job in bringing the 2015 plan to fruition. Here are a few of the highlights. The journey from on-balance-sheet litigation funder to being a manager of litigation funding capital is now almost complete. There are still a few balance sheet investments awaiting completion, most notably the Wivenhoe and Westgem matters. But since October 2017, all new matters have been placed into our funds. There are now 7 funds in existence, representing funds under management of approximately $2.2 billion. Since the setting up of Fund 1, we've had little trouble attracting large institutional investors and endowment funds seeking non-correlated returns. Our investment funds are nonrecourse. And based on our 20-year track record of success in the choice of investments, we expect that as they mature, they will provide superior returns to Omni Bridgeway as manager and co-investor at a lower risk. Importantly, the availability of this capital and the willingness of investors to recycle the capital back into the funds will allow us to grow our book with relatively little constraint to invest in larger matters and, thus, be at the vanguard of the growth of the industry across the globe. In 2015, we were an essentially Australian business with an incipient U.S.A. business and a small joint venture in the U.K. Today, the majority of our business is, in fact, in the Northern Hemisphere with large businesses in North America and in Europe. We also have commenced businesses in Asia, and we think there are enormous opportunities across the Asian region as it leads world economic growth. Looking ahead over the next 5 years, it's clear that if we take our opportunities, the Northern Hemisphere, with its massive legal and capital markets in the Americas, Europe and Asia, will, in fact, be the new epicenter of our business. In 2015, we are a litigation funder investing in a relatively small number of matters, mostly class actions in Australia. Today, through organic geographic expansion and the merger with the Omni Bridgeway European business, we invest in litigation and arbitration funding, cross-border enforcement actions and distressed asset recovery through the Distressed Asset Recovery Program, or DARP, which is a joint venture with a subsidiary of the World Bank. To put some numbers around these achievements, from 2015 to date, our estimated portfolio value of our book has grown from AUD 2 billion to almost AUD 16 billion at 30 June 2020 and almost AUD 17 billion at 30 September this year. Case numbers have grown from 41 to 304. Countries of operation have grown from 3 in 2015 to 10 in 2020; and offices, from 9 to 18. Staff numbers have grown from 35 to 168 today. And funds under management have grown from 0 to approximately $2.2 billion with fund structures growing from 0 to 7. On any measure, these are significant achievements and have created the platform for our next 5-year plan, which is to make your company a preeminent global leader in the financing and management of legal risk. I'll leave it to Andrew to take you through the plan, but suffice to say, it is a very exciting plan. It's certainly audacious, but nevertheless, we believe it's achievable, and the plan is fully endorsed by the Board. Turning now to FY '20, here are the financial highlights. Gross investment revenue increased by 727% to $290 million. The carrying value of our investments increased by 47% to $628 million. The estimated portfolio value increased by 67% to $15.8 billion. Cash and receivables increased by 35% to $329 million. And as shareholders will recall, we refinanced our notes on better terms with the maturity date out to January 2026. As we are currently in transition from the on-balance-sheet funder to a fund manager coinvestor model, the immaturity of the funds and the return waterfalls as between us and the fund investors mean that despite the revenue and cash generated in FY '20, this did not fall through to profit. However, with $628 million in investments, having an EPV, estimated portfolio value, of almost $16 billion, very material profits and cash will be generated in the coming years. Those investments continue to perform as expected. In addition, despite being successful at first instance in the Wivenhoe matter, we're unable to recognize any revenue or profit as the dependents have appealed against the decision. I'll leave it to Andrew to take you through the detail of the Wivenhoe and Westgem cases. As shareholders will be aware, these are our 2 largest remaining balance sheet cases, both of which have been determined at first instance in our favor and one against. And as previously announced, we have appealed in the Westgem case. The 2 most significant events in FY '20 were, of course, the merger with Omni Bridgeway and our subsequent change of name, which was almost immediately followed by the [ urgence ] of COVID-19 and its spread across the world. Dealing first with the merger. Europe, including the U.K., is currently the second largest litigation and legal market in the world, behind only the U.S.A. Accordingly, having a strong position in that market was and is a key part of our strategic intent. The Omni Bridgeway business provided an opportunity to gain that strong position by joining forces with a company that has a track record dating back to the 1980s, a respected brand name in Europe and beyond, a complementary skill set in enforcement and asset tracing and recovery and a corporate culture that fits very well with our business. It's just over a year since the merger was completed. I can't go into the details of the transaction, but they've been well canvassed, including at last year's AGM. As you would expect, our first year in common ownership was planned to be one replete with the integration activities and many of them or most of them face-to-face. Unfortunately, the pandemic intervened and made travel albeit impossible. I've been amazed at how well our virtual Zoom integration has gone. Again, I'll leave it to Andrew to provide you with the details, but from the Board's perspective, I don't think we could have hoped for the combination of the businesses to have gone more smoothly especially given the difficult circumstance. It is clear that our respective cultures are a good fit. We share common values and ambitions. Our people get on well. They respect each other's talents and collaborate enthusiastically. We are already behaving as one organization with one guiding purpose and a burning ambition to succeed. There are already a number of examples of successful pitches to new business clients that combine our geographic footprint and our respective areas of expertise. New business opportunities are strong, including in the European business, and the change of name has not caused any impairment in the momentum of the old IMF Bentham business. Already, there have been a number of completions in the European business which give us comfort about our pre-transaction assessment of value. We do not -- we are all delighted with the scope and the scale of the merged business. And as Andrew will shortly present, we have very big plans for the future. Those plans could not have been as bold or as ambitious without the merger with Omni Bridgeway. Turning now to COVID-19. As everyone knows, it has affected communities and businesses right around the world. And unfortunately, it seems a second wave has hit Europe and North America, and it may well spread elsewhere as the Northern hemisphere winter approaches. If the Spanish flu of a century ago is any indicator, in the absence of an effective vaccine, there may be 12 months or more of disruption and uncertainty. Our business has weathered the COVID storm well. Ours is a business that lends itself more than most to working from home. All our offices were early and quick to react, and the necessary protocols, processes and IT requirements for working from home were swiftly and effectively put into place. I want to thank our management teams and our support services, indeed, all our people, the way they've responded to the pandemic. Our staff have taken responsibility for their own health and for that of their colleagues. We operate in a number of countries that have been COVID hotspots, but thankfully, thus far, we've been barely touched. We will do all we can to see that, that remains the case. Our staff have used innovative ways to manage the business, to stay in touch with each other and with our clients and prospective new business opportunities. Whilst it is difficult to accurately predict how the pandemic will eventually affect -- someone, I think, there's a noise in the background. If somebody could mute their phone, please. Thank you. Our staff have used innovative ways to manage the business, to stay in touch with each other and our clients and prospective new business opportunities. Whilst it's difficult to accurately predict how the pandemic will eventually affect our business, there appears to be both positive and negative impacts, unsurprisingly. On the negative side, there does appear to be some delays in completions due to courts being unable to sit. To date, there's not much evidence of this other than in some states in America. Most courts and arbitrations have been adaptable in the use of technology and COVID-safe protocols to enable trials to continue. On the positive side, though I hesitate to call it positive in view of the misery caused to many people around the world, this sort of disruption, economic hardship and uncertainty such as that being caused by COVID typically does see an increase in disputes, distressed assets and insolvencies. We're certainly seeing a lot of new business opportunities around the world, and we'd expect that to continue for some time to come. With our global footprint, access to capital through our funds and our suite of skills and services, we're well placed to have a seat at the table as these opportunities emerge. The other issue that arose in 2020 I should mention is the Australian Parliamentary Joint Committee on Corporations and Financial Services inquiry into litigation funding and the regulation of class actions. Andrew will cover this in more detail, and there's been no final report issued as yet. There are a couple of points I would like to make. The first is that the government has already moved to regulate litigation funding of class actions by bringing it into the managed investment scheme, or MIS, regime. These schemes are regulated by ASIC and, among other things, require the promoter to hold an Australian financial service license, or AFSL. Omni Bridgeway, in fact, held such a license until 2013 until the then government decided such a license was not required by litigation funders. We've now successfully applied for and received our new AFSL under the new regime, so there is absolutely no impediment in us funding class actions in Australia. The second point is, notwithstanding our history, due to our global growth, class actions are becoming a much smaller part of our portfolio. 66% of our book and growing is now in the Northern Hemisphere. Of 304 cases worldwide, 31 are class actions. This is not to downplay our continuing interest in participating in this type of funding, quite the contrary, but rather to put its overall importance into -- to our business into perspective and particularly when one looks out into the future. On the regulatory front, the Victoria government has legislated to legalize contingency fee arrangements in that state. Now how this will work in the face of the federal government MIS regulation is currently unknown. Again, Andrew will provide a little more detail. So looking forward into 2021 and beyond, if we're correct in our prediction of additional opportunities in the face of the pandemic turmoil, I believe your company has one of the best, if not the best platform in the world to drive profitable growth. As I observed above, much of this growth will come from the enormous legal risk markets in the Northern Hemisphere. That growth will be funded in large part by international capital markets through our current and new fund structures. Accordingly and at the request of a number of our large institutional shareholders, the Board will conduct a review of whether Australia remains the best place to have our home listing. The Board has no particular view on this at present other than the recognition that as the business is increasingly invested internationally and growing more so each year, it is an appropriate time to have a thorough review of all options to determine what is in the company's best interest, including a potential listing in London to gain visibility with international investors. The Board will therefore assess the potential advantages of raising the company's profile and gaining access to deeper capital markets, whether through a dual listing or moving our listing. And of course, shareholders will be kept informed as that review proceeds. On behalf of the Board, may I express our sincere thanks to the people of Omni Bridgeway right across the world. Notwithstanding the extreme and ongoing disruption caused by COVID-19, I've simply got on with the job of looking after one another, of serving our customers and of running our business in as seamless fashion as possible. We are very fortunate indeed to have such a wonderful team of decent, hard-working and very talented people. I also thank my colleagues on the Board. As always, I greatly appreciated their wise counsel and their calm and practical approach as we have navigated our way through this difficult pandemic year. We remain hopeful that COVID-19 will abate during the course of the next calendar year. But I believe whatever the future may hold, our business is in a better position than most to sustain itself and grow this year, next year and beyond. COVID aside, it is a very exciting time for Omni Bridgeway and its people. We now have a genuine global footprint. We have a presence in all the major legal markets in the world. We have access to capital through our funds to support our growth ambitions. We have a broader scope of products and services to offer our clients. And we have built up a very substantial pipeline of investments, which is expected to generate significant cash and profits as those investments mature. To put a little bit more color on that, a little bit more meat on the bone, it's now my very great pleasure to hand over to our CEO, Andrew Saker, who will present his view of FY '20 and his plans for this year and beyond. Over to you, Andrew.

Thank you, Michael. Good afternoon, ladies and gentlemen. On behalf of the management team and staff, I would like to also welcome you to the Annual General Meeting for Omni Bridgeway Limited for the financial year ended 30 June 2020. Firstly, I would like to thank the Board for their support throughout the last financial year. We have progressed many strategic initiatives throughout the year, and our Board has been available throughout and provided valuable counsel on these initiatives. Secondly, I would like to thank the Omni Bridgeway team throughout our global network who have embraced the Board's strategy and executed it with enthusiasm and consummate professionalism. Secondly, I would like to echo the Chairman's comments in relation to our Founder, Mr. McLernon. In addition, I would like to thank Hugh personally for his assistance and guidance provided to me in my role as Managing Director, without which I'm sure this role would have been exponentially more complicated. And now let's look at the year in review. As the Chairman noted, FY '20 saw the end of our first 5-year plan and the development of our second 5-year plan. That first 5-year plan was focused on diversification of risk through the diversification of our investments and the capital used to finance them. We've achieved all of the goals we set for ourselves culminating in the merger with Omni Bridgeway in Europe. At the start of our 5-year plan, we found ourselves highly concentrated in a small number of largely Australian class action investments, which exposed us to a number of risks including competition and regulation. We had around 40 investments serviced by a team of 35 professionals. Our primary goal was to diversify our investment portfolio to ultimately lead to a more stabilized earnings stream. Over the last 5 years, we've invested heavily into this strategy and, with the support of our shareholders, achieved many of those goals that we set for ourselves. We now find ourselves in the enviable position of being the largest litigation funder in the world with operations in Australia, U.S.A., U.K. and EMEA, Canada and Asia, with over 300 direct investments serviced by a team of over 160 professionals. We anticipated that scale would be a critical driver of success and that there was only room for 1 or 2 key players in the market. This thesis has been borne out. In addition to the diversification of our operations, we sought to diversify the capital from which these investments would be funded. In 2015, we funded all investments entirely by way of our balance sheet. This exposed our financial performance to potential ticker shock, which we experienced with a significant loss or a delay in completions. We were unable to expand our investments as we were largely reliant on completions to finance new investments. As such, we commenced funding investments by way of third-party capital. The commercial terms of our first-generation funds were largely driven by market conditions that required more friendly terms -- more investor-friendly terms. With the increase in appetite from investors for litigation finance investments, we were able to modify the terms of our fund structures to be more manager friendly. We now operate 7 funds including those acquired by way of the merger. This provides us with the capacity to invest in a broader range of investments, generating a return in management fees, performance fees and as an investor in those funds, which diversifies risk, expands our income generation capacity and provides the opportunity to stabilize our earnings. Whilst we have executed this strategy, shareholders should not lose sight of the reality that our investment duration is, on average, 3 years. As such, the full benefit of this strategy will not materialize for a few years from now. Turning to our financial results for FY '20. FY '20 was, in many respects, a breakout year for Omni Bridgeway. We achieved a record in terms of completions, resulting in a record of income generation. Using last year as a point of comparison is, to some extent, irrelevant given the continued lumpy nature of our earnings. As such, I won't dwell on those comparisons. Suffice to say that FY '20 is the type of performance that we aim to deliver on a regular basis as a consequence of our current platform. It is worth pausing at this point to mention the delay in the release of the financial results. As shareholders will be aware, there was a slight delay in the delivery of our annual results. This was largely due to the need to account for the fair value of the liability associated with the deferred and contingent liability in relation to the merger with Omni Bridgeway. This was addressed and resulted in a $13.6 million adjustment to the carrying value of that liability. This was a noncash adjustment and has, to some extent, reversed since the balance date as a consequence of the movement in our share price. As you will note from this slide, we generated a record amount of revenue, exceeding $300 million for the first time in our history with commensurate flow-on effects for profit. It is also worth pausing here to reflect on the NCI allocation of profit. As many investors are aware, we structured our first-generation funds with third-party capital and kept return prioritized in our capital and management returns. This was largely a market-driven requirement which gave us materially leveraged if subordinated return on our invested capital. As a consequence, we are required to pay priority returns to our investors, which means profit is allocated to those investors in the first instance. This is, of course, an accounting entry that also follows the cash flow. However, subject to the repayment of the preferred returns, these will reverse in the back end of the life of these funds such that we will receive the bulk of the revenue and cash flow. It is evident that this will occur for Funds 2&3 sooner than Fund 1 given the slower drip feed deployment of capital in Funds 2&3 and the rate of completion in Funds 2&3 and its overall success rate. It's also worth noting from this slide the material increases in investments and EPV. The increase in investments arises both from organic growth from our platform but also from the acquisition of Investments as a consequence of the merger with Omni Bridgeway, which increased in aggregate by 49% year-on-year. This is a material increase in potential income-generating assets for the future. Whilst not reflected in this slide, we note that we have continued to see a significant increase in funding applications from all our markets in the first quarter of FY '21. This is consistent with our experience since the COVID pandemic erupted and provide support for the thesis that not only is our stock uncorrelated but also countercyclical. In this slide, we highlight the material growth in key balance sheet metrics over the past 5 years. As you'll note, we've increased our cash and receivable position over time. To facilitate the growth in assets, we've required additional access to cash which was generated through our fund structures. Our balance sheet cash has remained reasonably stable over the growth period, and our liquidity has been provided by third-party capital. Our net asset position has grown significantly over the same 5-year period both in terms of our balance sheet position but also in terms of contributions from third-party capital. As noted in the previous slide, our investments have increased materially over the past 5 years at a CAGR of 44%. Our balance sheet investments, which are largely tied up in Wivenhoe and Westgem, have been decreasing over time as a percentage of total investments as we transition from the fund management model. Our investment in funds have increased over that period financed by both balance sheet and fund investors. Our EPV has increased at a commensurate rate, reflecting a 46% CAGR over that period. We've included in this presentation a portfolio summary at 30 September 2020 given its greater relevance than the statement at 30 June 2020. As you will note, we continue to experience material growth in our portfolio which is spread over our balance sheet and our 7 fund structures. We continue to experience a record number of applications which allows for more opportunities to be reviewed and considered by our investment committees. We have, however, maintained our conversion rates, which reflects a continuing strong discipline in considering appropriate matters. As you will note, we've had some completions drift to complete in FY '22 from FY '21. This is a normal function of our investment cycle but also reflects the impact of COVID on completions in the U.S., which run commercial litigation via jury trials. We would anticipate some further drift is likely in FY '21. It is important to note that this is not lost income but deferred income. COVID has created a double-edged sword for our business, creating more funding opportunities as we seek to assist businesses and more firms cope with the financial consequences of the pandemic but which has also resulted in some delays particularly in U.S. completions. One of the key objectives of our first 5-year plan was to diversify our portfolio. At the start of that plan period, we were highly concentrated in Australia and in multiparty matters. At the end of the plan period, we have achieved our goal to diversify geographically and by investment type. As you will note, we have now split between U.S. and non-U.S. investments reasonably evenly. There is a focus on U.S. and U.K. and EMEA given the size of their legal markets. This trend is likely to continue in the future given the size of our teams in those jurisdictions. As you will note, Australia now represents 18% of our portfolio, the majority of which is tied up in Wivenhoe and Westgem. With respect to case diversification, as you'll note, our portfolio is largely associated with commercial arbitration and litigation, a distinct shift away from multiparty actions. We expect that the portfolio will remain reasonably balanced as multiparty matters will continue to form an important part of our investment strategy. In the short term, we expect to see an increase in solvency-related investments as governments removed protections implemented during the COVID crisis and monetization opportunities that will form part of our active investment strategy. To conclude my presentation, I'd like to turn to our next 5-year plan. Omni Bridgeway is now the largest litigation funder in the world in terms of platform, head count and geographic presence. We have the opportunity to leverage off that platform to continue to expand the business. The overall objective is to grow our funds under management with new and existing funds as commitment and deployment targets are met. We plan to achieve this objective through 3 key strategic priorities, which are: firstly, to expand geographically into new markets and within existing markets. We've identified a number of targets for expansion, including in New Zealand and Japan, where we have already established a foothold; but also into new markets, including India, North Africa and Latin America. In our existing markets, we will look to new offices in Canada and the U.S.A. Secondly, to expand our offerings, including an active investment management -- investment strategy where we shift from agent to principal, allowing us to increase capital deployed in absolute returns. This includes acquisition of claims, judgments and awards, appeal funding and distressed debt. We are also looking to downside risk management strategies, which involves taking on risk without deploying capital, creating a synthetic leveraging in our funds. Thirdly, to increase our head count to facilitate the first 2 objectives. This will not be a massive shift in head count but at an average of around 5% per annum over the next 5 years as we continue to anticipate achieving greater efficiencies from our team in terms of commitments per investment management. That concludes my presentation, and I will now hand back to the Chairman. Thank you.

Well, thank you, Andrew, very much. Now before we deal with the formal business of the meeting, I'd like to take this opportunity to inform the meeting that resolution 6, which seeks approval for the issue of additional consideration shares, has been withdrawn. The company has determined that there is no market value compensation amount payable to the sellers in accordance with the share purchase agreement, and therefore, it's not necessary to compensate the sellers through the issue of additional consideration shares. We will now deal with the formal business as set out in the Notice of Meeting. And at the close of the formal business, my fellow directors and I will answer any general inquiries. I've been advised that a quorum of shareholders is present, and I therefore declare the meeting open. The Notice of Meeting has been made available to all shareholders and all directors. The only items on the agenda are the 7 items set out in the Notice of Meeting, and I take the Notice of Meeting as read. In order to vote at this meeting, you can follow the instructions on screen to register to enable you to vote. Please consult the virtual meeting online guide, which has been made available to all shareholders. If you are an appointed proxy, you'll need your proxy number, which will have been provided by Link Market Services prior to the meeting. Once you've logged in, please ensure that you keep your browser open for the duration of the meeting. If you close your browser, your session will expire. The company did not receive any written questions prior to this meeting. Prior to voting on a resolution, I will allow an opportunity for shareholders to ask questions on that item of business. [Operator Instructions] Please note, you'll only be able to ask a question after you have registered to vote. Shareholders are requested to confine questions to matters relevant to the particular item of business. And please note that your questions may be moderated if we receive multiple questions on one topic and may be amalgamated and responded to together. For procedural efficiency, I request that all general questions be left until the end of the meeting and the formal business has concluded. Voting will be conducted by poll, and I now declare the poll open. At the conclusion of the meeting, a red bar with a countdown timer will appear at the top of the webcast and slide screens advising the remaining voting time. If you have not yet submitted your vote at that point, you will be required to do so. At the conclusion of the meeting, any votes you have placed will automatically be submitted. If you have any issues with voting, please call the virtual meeting help line number shown at the top of the webcast, and you will be directed to a Link Market Services representative who'll be able to assist you. Moving to the proxies. Please refer to the total number of proxies received. The proxies are on the screen, and they are available for inspection. The minutes of the last Annual General Meeting of the company held on 20 November 2019, are available from the company if any shareholder wishes to inspect them. I now table the financial statements of the company for the year ending 30 June 2020, together with the directors' declaration, directors' report and the auditor's report. Are there any questions on the financial statements? Or are there any questions for the auditors in relation to the conduct of the audit?

Chairman, there are no questions online in relation to this item business.

Thank you. If there are no questions in relation to the annual financial statements, I'll now proceed on the basis that the meeting has received the financial statements and move on to the resolutions to be put to shareholders today. Resolution 1 relates to the remuneration report. The remuneration report relating to directors and executives' remuneration in the financial year ending 30 June 2020, must be submitted for adoption by resolution of shareholders. The remuneration report is in the annual report. I confirm that the company has received valid proxy votes in relation to resolution 1, as displayed on the screen. All discretionary votes in favor of the Chair will be voted in favor of the resolution. The directors recommend that shareholders vote in favor of this resolution. Are there any questions?

Chairman, there are no questions online in relation to this item of business.

If there are no questions, I now put the resolution to a vote, and I'll pause for a moment to allow the voting to occur. [Voting]

Moving now to resolution 2. Resolution 2 relates to the reelection of Hugh McLernon as a director of the company. Mr. McLernon was reelected by shareholders of the 2017 Annual General Meeting in accordance with the ASX Listing Rules. Mr. McLernon must retire at this Annual General Meeting and seeks reelection by the shareholders as a director. As previously discussed, Mr. McLernon is the founder and pioneer of the contemporary dispute finance industry. He's been an executive director and a member of the company's Investment Committee since 2001. And he also oversees special projects for the company. Mr. McLernon's experience and credentials are self-evident and are set out in the Notice of Meeting. I confirm the company has received valid proxy votes in relation to resolution 2, as displayed on the screen. All discretionary votes in favor of the Chair will be voted in favor of the resolution. And I confirm that the Board, excluding Mr. McLernon, supports the election of Mr. McLernon and recommends that shareholders vote in favor of this resolution. Are there any questions?

Chairman, there are no questions online in relation to this item of business.

If there are no questions, I now put the resolution to a vote, and I'll pause for a moment to allow the voting to occur. [Voting]

Resolution 3 relates to the reelection of Karen Phin as a director of the company. Ms. Phin was elected by shareholders at the 2 -- the 2017 Annual General Meeting. And in accordance with the Listing Rules, Ms. Phin must retire at this Annual General Meeting and seeks reelection by the shareholders as a director. Ms. Phin has over 20 years' experience advising Australian-listed companies in the retail, banking, industrial and natural resources sectors on capital management, capital raising and mergers and acquisitions. Ms. Phin is a member of the Audit and Risk Committee, Remuneration Committee, Nomination Committee and is Chair of the Corporate Governance Committee. Ms. Phin's experience and credentials are set out in the Notice of Meeting. I confirm the company has received valid proxy votes in relation to resolution 3, as displayed on the screen. All discretionary votes in favor of the Chair will be voted in favor of the resolution. And I confirm that the Board, excluding Ms. Phin, supports the election of Ms. Phin and recommends that shareholders vote in favor of this resolution. I move the resolution as displayed on the screen. Are there any questions?

Chairman, there are no questions online in relation to this item of business.

If there are no questions, I now put the resolution to a vote. I'll pause for a moment to allow the voting to occur. [Voting]

Resolution 4 relates to the election of Raymond van Hulst as director of the company. Mr. van Hulst was appointed by the Board on 9 April 2020. In accordance with the Listing Rules, Mr. van Hulst must retire at this Annual General Meeting and seeks election by the shareholders as a director. Mr. van Hulst was a Managing Director of the Omni Bridgeway Holding B.V. business that was acquired by Omni Bridgeway Limited, then, of course, IMF Bentham Limited in November 2019. Mr. van Hulst has close to 2 decades of experience in structuring innovative solutions for complex and high-value litigation funding and legal enforcement matters. Mr. van Hulst's experience and credentials are set out in the Notice of Meeting. And as shareholders will recall from last year's AGM, Mr. van Hulst's position on the Board was and is a crucial part of our integration plan as between the merged businesses. Having Mr. van Hulst sitting on our Board has proved particularly effective in maintaining open and transparent communications through COVID-19 when travel has been impossible. I confirm that the company has received valid proxy votes in relation to resolution 4, as displayed on the screen. All discretionary votes in favor of the Chair will be voted in favor of the resolution. And I move resolution 4 as displayed on the screen. Are there any questions in relation to this resolution?

Chairman, there are no questions online in relation to this item of business.

If there are no questions, I will now put this resolution to a vote, and I'll pause for a moment to allow that to occur. [Voting]

Resolution 5 relates to the issue of tranche 1 deferred consideration shares. Resolution 5 seeks shareholder approval for the issue of up to 4.833 million shares -- tranche 1 deferred consideration shares to the sellers pursuant to the share purchase agreement entered into by the company for the 100% purchase of Omni Bridgeway Holding B.V. Resolution 5 is an ordinary resolution. I confirm that the company has received valid proxy votes in relation to resolution 5, as displayed on the screen. And all discretionary votes in favor of the Chair will be voted in favor of the resolution. The directors recommend that the shareholders vote in favor of this resolution. And I move resolution 5 as displayed on the screen, and I'll pause. Are there any questions?

Chairman, there are no questions online in relation to this item of business.

If there are no questions, I now put this resolution to a vote, and I'll pause to allow that to occur. [Voting]

As mentioned earlier, resolution 6 has been withdrawn, and I will therefore move to resolution 7. Resolution 7 relates to the issue of performance rights to Raymond van Hulst under the long-term incentive program. Resolution 7 seeks shareholder approval for the grant of performance rights in accordance with the LTIP to Mr. van Hulst or his nominee over the 3-year period commencing from the date of the meeting, which will cover LTIP awards for the financial years ending on June 30, 2020, '21 and '22. Please note, there is a typographical error in table A of the Explanatory Memorandum section of the Notice of Meeting for resolution 7 that incorrectly states that Mr. van Hulst total fixed remuneration is in Australian dollars. The correct currency for those remuneration figures should have been Swiss francs. I confirm that the company has received valid proxy votes in relation to resolution 7, as displayed on the screen. All discretionary votes in favor of the Chair will be voted in favor of the resolution. The directors, excluding Mr. van Hulst, recommend that the shareholders vote in favor of this resolution. And I move the resolution as displayed on the screen. Are there any questions in relation to this resolution?

Chairman, there are no questions online in relation to this item of business.

If there are no questions, I will now put the resolution to a vote and pause for a moment to allow that to occur. [Voting]

Resolution 8 relates to the approval of indemnified persons' deeds of indemnity, insurance and access. And it seeks shareholder approval in relation to Mr. van Hulst and Ms. Daniels' deeds of indemnity, insurance and access that they've entered into with the company prior to the meeting. I confirm that the company has received valid proxy votes in relation to resolution 8, as displayed on the screen. And all discretionary votes in favor of the Chair will be voted in favor of the resolution. The directors recommend that shareholders vote in favor of this resolution. And I move the resolution as displayed on the screen. Are there any questions in relation to this resolution?

Chairman, we have received the following question from [ Rita Mazalevskis ]. Chairman, under the indemnified persons' deed of indemnity, insurance and access, would you confirm if this will apply to any external contractors, people representing or working for OBL? If so, for example, if you were to provide this cover for GRACosway staff or Chair, Ms. Coonan, with many known conflicts of interest, why do you think it would be fair for shareholders to pay this cost to someone with so many opposed interests across several organizations, which would oppose OBL?