TeraGo Inc. (TGO) Earnings Call Transcript & Summary

Good morning, everybody. It's 11 a.m. Eastern Time, so it's time to call the meeting to order. This is Matt Gerber speaking, and I'm the TeraGo Board Chairman. On behalf of the TeraGo Board and the management team present, we'd like to welcome you to our Annual General Meeting. And as you know, I'll be presiding as the meeting chair. Hopefully, all of you and your loved ones and friends are safe and healthy in these interesting and challenging times. As all companies have done these days, we're holding our annual general meeting virtually due to the COVID-19 pandemic. Since this is our first virtual AGM, we want to establish a few rules and procedures for this meeting so that things can go smoothly for all of us. Any registered shareholder or duly appointed proxyholder can submit a question via the instant messaging service. It might take a few seconds if you do submit something before you see that question on your screen, but it should pop up. We'll answer any questions about the meeting agenda items to be addressed during the meeting. Any questions that are deemed out of order or constitute special business for which advance notice to fellow shareholders was not provided will not be addressed during the meeting. Other questions that we can answer about the company can be addressed after the formal meeting concludes. Tony Ciciretto, our CEO; and Dave Charron, our CFO, are also here and can address those other questions at the conclusion of the meeting. We do encourage all shareholders to e-mail questions to us at ir.terago.ca so Tony and Dave can correspond with you directly about your specific questions. For this meeting, we'll be handling all voting electronically. Any shareholders or proxyholders that have not voted yet can vote electronically when we open up the polling. If you've already voted in advance of this meeting with your control number, there's no need to vote again today unless you've changed your mind on a resolution. Voting today will cause the previous votes to be revoked and replaced with today's ballot selections. So before we get going, any questions on how this virtual meeting will work today? Okay. So I don't see any questions. So let's get going with today's business, which is described in the company's circular dated May 28, 2020. Mark Lau, our legal VP, will act as Secretary for this meeting. Computershare Investor Services through its rep, Kate Stevens, will act as Scrutineer to tally up the votes and report the results to me and Mark. To keep things moving today, I'll move and second all motions, which we will then put to a vote. The notice calling this meeting, the circular and a proxy or voting information form or VIF were mailed on June 2, 2020, to each shareholder that we had a record of as of May 25, 2020. Unless anyone has any objections, I'll dispense with reading the formal notice of that, formal reading of that notice. Okay. I don't see any questions. So proof of service of those documents will be attached to the meeting minutes. These documents are also available under the company's profile on the SEDAR website or on the company's Investor Relations page at www.terago.ca. I've been told that we have more than a minimum requirement of 2 shareholders present at this virtual meeting, and therefore, a quorum is present to conduct today's business. The scrutineer's report on attendance will be annexed to the minutes of this meeting. First item on the agenda today is the presentation of our audited consolidated financial statements for 2019, along with the auditor's report and the MD&A. These documents have been mailed to certain shareholders that requested paper copies, but most shareholders access these electronically on SEDAR or via the company's website. The next item on our agenda is fixing the number of directors of the company. Currently, the company has 7 directors and the articles of the company permit a minimum of 1 and a maximum of 10. We're proposing to keep that number at 7. If there are no questions about the number of directors, I'll move and second the motion to fix the number of directors of the company at 7, and we'll open the polls to voting by ballot. Computershare, please have the polls open. [Voting]

We'll now move on to the next item on the agenda, which is the election of the directors. Tony Ciciretto, Michael Martin, Gary Sherlock, Laurel Buckner, Richard Brekka, James Sanger and I have been nominated as directors for this coming year or until successors are elected or appointed. Each of the persons nominated has confirmed that he or she is prepared to serve as a director. Now one thing to point out, which is relevant to this election, is what was noted in the circular about a Board member search that is ongoing. The company's Governance Committee is currently conducting a search to identify a new director. It's expected that if and when a candidate is identified, James Sanger has committed to resign from the Board, and the new candidate will be appointed to serve until the next shareholders' meeting. Are there any shareholders who wish to make a further director nomination at this point? Okay. I don't see anything coming across, so I'll assume that's no. So since there are no further nominations, nominations are now closed. I move and second the motion to elect the directors. Please cast your votes now for each director on the ballot. [Voting]

The next item of business is the appointment and remuneration of our auditors. It's proposed that the company's current auditors, KPMG LLP Chartered Accountants, be reappointed. I'll move and second the motion to reappoint KPMG LLP as auditors to hold office until the close of the next annual meeting of shareholders and that the Board be authorized to fix their fees. Unless there are any questions, please cast your vote now on the auditors while I move to the final item of business. [Voting]

The company is seeking shareholder approval to amend its current share option plan and to reserve 165,000 additional common shares issuable upon the vesting and exercise of such options. Details and particulars are set out in the circular. The 165,000 additional shares represents a de minimis increase of shares reserved for issuance or less than 1% of the current issued and outstanding. This number was picked by the Board to minimize the dilutive impact to shareholders in light of the current economic environment and the global health emergency. The exact text of the shareholder resolution called the share option plan resolution is found in the circular. Are there any questions about this proposal? And I'll give it a second to see if any of you have any questions. Okay. So I don't see any questions coming through at this point. So if not, I'll move and second the motion for the approval of the share option plan resolution, which will amend the share option plan and will reserve 165,000 common shares of the company for issuance under the plan. Please cast your votes now for this last resolution. [Voting]

Again, with the polls open, registered shareholders and proxyholders who have properly logged in with their control numbers or user names should be able to see all of the motions that are being proposed today. I will give everyone another minute or so to register their votes. Once the electronic balloting closes, the voting page will disappear and the votes will automatically be submitted at that point. So we'll pause now to let any additional votes come in. Okay. So I don't see anything else coming in at this point. So given that, we'll declare that the polls are now closed. So Computershare, you can close the polls. So thank you, everybody. Our scrutineer will now compile the voting results report. Please hang tight for a few moments while they get that process completed. Okay. So it looks like I have been advised at this point by the scrutineer that the ballots and proxies deposited for the meeting have been voted in favor of the resolutions, and therefore, the following resolutions are passed: the number of directors of the company is fixed at 7, each of Matthew Gerber, Tony Ciciretto, Michael Martin, Gary Sherlock, Laurel Buckner, Richard Brekka and James Sanger have been elected as Director of the company to serve until the next annual meeting of shareholders or until their successors are elected or appointed; KPMG has been reappointed as the company's auditors, and the Board has been authorized to fix their fees; and the share option plan resolution is approved. The results of the voting will also be announced in a press release in accordance with the rules of the TSX and filed on SEDAR. So this wraps up the formal part of the meeting. As there is no further business to come before the meeting, I will move and second that this meeting now terminate. And again, thank all of you for participating as I now turn the meeting over to Tony, who can address any other questions that you may have for us. Okay. Tony, over to you. Thanks, everybody.

Thank you, Matt, and good morning, everyone. Before I open the session to questions, I'd like to also echo Matt's sentiment earlier and hope that you and your loved ones are staying healthy and safe. Since the pandemic crisis began, we have strived, the management team and employee base, to support our customers with the quality of service that they are accustomed to receiving from TeraGo while ensuring the health and safety of all our employees. I'm certainly very proud of the way that TeraGo's team has stepped up to meet the challenge and certainly would like to express my sincere thanks to all our employees. I would also like to thank you, our shareholders, for your continued support, and we dedicate ourselves towards making TeraGo a success. Now at this time, I'd like to ask that attendees who would like to ask a question use the messaging feature of the virtual interface to do so or as Matt referenced earlier, we'd certainly be very happy to follow up and address questions afterwards via e-mail or on a one-to-one call. When asking your question, please include your name, the entity you represent, if any, and confirm you are a registered shareholder or a duly appointed proxyholder. Please keep your questions short and to the point. For each question we'll answer, we will summarize the question and read out loud the name of the person who asked such question and if applicable, the entity such person represents. So I'll give it a minute if there's any questions. All right. Okay. Since there are no questions, I'd like to thank everyone for their participation at today's AGM, and close the Q&A part of the meeting. And I'd like to wish everyone a great day. Thank you.

This concludes the meeting. You may now disconnect.