Touchstone Exploration Inc. (TXP.L) Earnings Call Transcript & Summary

Thank you for standing by. This is the conference operator. Welcome to the Touchstone Exploration Annual Meeting of Shareholders. [Operator Instructions] I would now like to turn the conference over to John Wright, Chairman of the Board of Directors of Touchstone Explorations Inc. (sic) [ Touchstone Exploration Inc. ]. Please go ahead.

Thank you, Arielle. Good morning, ladies and gentlemen. I'll now ask that the 2021 Annual Meeting of Shareholders come to order. As stated, my name is John Wright. I'm the Chairman of the Board of Directors of Touchstone Exploration Inc., and it is my responsibility and privilege to chair today's meeting. On behalf of the company, I once again welcome you to this Annual Meeting of Shareholders. I'm pleased we're able to connect to so many of you today despite the continuing COVID-19 pandemic. Although we are unable to meet in person, our goal today is to ensure that you're able to participate fully in the meeting. I invite you, our shareholders and duly appointed proxy holders, to ask questions and vote on each of the matters of business as if you're attending the meeting in person. We strive to emulate our usual meeting as much as possible. I encourage you to submit your questions as early as possible so that we may address them at the right moment during the meeting. [Operator Instructions] Please identify whether your question relates to a motion being considered as part of the formal business of the meeting or whether it is of a more general nature. We'll try to address questions that directly relate to a particular motion at the appropriate time in the meeting, while general questions will be saved for the question-and-answer period following the formal part of the meeting. Those of you who have signed in as registered shareholder or a duly appointed proxy holder may vote via the online platform. You will only have 1 minute to cast your vote. Voting will open only after all items of business have been discussed. If you voted in advance of the meeting and do not wish to change your vote, then you do not need to do anything. If you wish to change your vote, then voting online will have the effect of revoking your previously submitted proxy. After my introductory remarks, we will proceed through the regular items of business. So just before we proceed with the formal business of today's meeting, I'd like to introduce the other directors and members of the management of Touchstone who have joined us online today. Joining us are Mr. Kenneth R. McKinnon, director; Mr. Peter Nicol, director; Ms. Beverley Smith, director; Mr. Stanley T. Smith, director; Mr. Thomas E. Valentine, director and Corporate Secretary; Dr. Harrie Vredenburg, Director; Mr. Paul R. Baay, director, President and Chief Executive Officer; Mr. Scott Budau, Chief Financial Officer; and Mr. James Shipka, Chief Operating Officer. In accordance with the bylaws of the company, I will preside as Chairman of this meeting. I hereby appoint Mr. Tom Valentine to act as secretary of the meeting and Mr. Paul Bedard of Odyssey Trust Company to act as the scrutineer. The notice calling this meeting was mailed to all shareholders on May 10, 2021. The declaration of mailing is available for inspection by any shareholder, and I ask that the secretary file a copy of the declaration of mailing with the minutes of today's meeting. A quorum of shareholders is present for the transaction of business at this meeting if at least 2 persons are present in person and holding or representing by proxy not less than 5% of the shares entitled to vote at the meeting. I've been advised by the scrutineer that there are 61 shareholders present today, representing 54,973,223 shares, which is 26.25% of the issued and outstanding shares of Touchstone. Accordingly, we have a quorum present. The scrutineer's report is available for inspection by any shareholder, and I'd ask the secretary to file a copy of such with the minutes of today's meeting. With that said, I declare that this meeting has been regularly called and properly constituted for the transaction business. We have a number of matters of business to deal with today. A full description of each matter is provided in the company's management information circular dated April 29, 2021, which was mailed to shareholders requesting it and otherwise made available online. To facilitate proceedings, I've asked [ Mr. Michael Kelly, Mr. Khiel Sardi and Ms. Sandy -- Stacy Henderson ], who are also shareholders, to move and second all motions. I will call on them at the appropriate time. This is not intended in any way to curtail discussion. As mentioned, voting will open only after all items of business have been discussed. Proxy holders will have 1 minute thereafter to cast their votes on all motions. Again, if you have voted in advance of the meeting and do not wish to change your vote, you do not need to vote again. If you do wish to change your vote, then voting online will have the effect of revoking your previously submitted proxy. Each item of business to be voted on today must be passed by a majority of the votes cast. The first item of business is the presentation of the audited financial statements for the year ended December 31, 2020, together with the report of the auditors. The financial statements were mailed to the shareholders requesting them, and I do not propose to read the auditors' report. Are there any questions or comments on the financial statements or the auditors' report?

John, there are no relevant questions received regarding the auditors' report.

Thank you, Paul. I declare that the audited financial statements of the company for the year ended December 31, 2020, together with the report of the auditors' thereon, have been received. The next item of business is to fix the number of directors to be elected at this meeting at 8. I will now ask for a motion on this matter.

Mr. Chairman, I move to fix the number of directors to be elected at this meeting at 8.

Thank you, [ Michael ]. Is there a seconder?

Mr. Chairman, I second the motion.

Thank you, [ Khiel ]. We'll now address any questions or comments from shareholders or proxy holders that are directly related to the motion to fix the number of directors to be elected at this meeting at 8. Have any questions or comments been raised?

No, we have not received any questions or comments at this time.

Thank you, Paul. The motion has been recorded and we will -- and will be voted upon after all other items of business have been discussed. The next item of business is the election of directors. Information about each nominee is included in the company's management information circular dated April 29, 2021, and I confirm that all nominees are eligible for election. I note that the Board of Directors has implemented an advance notice bylaw. Pursuant to this bylaw, advance notice must be given to the company regarding any proposed director nominees not included in the information circular. No such notice has been received by the company. I further note that we will be nominating and approving individual directors and not a slate of directors. I will now receive the nominations.

Mr. Chairman, I nominate each of those persons specified in the company's management information circular dated April 29, 2021, to be elected as directors of the company, namely Paul R. Baay, Kenneth R. McKinnon, Peter Nicol, Beverley Smith, Stanley T. Smith, Thomas E. Valentine, Dr. Harrie Vredenburg and John D. Wright.

Thank you, [ Khiel ]. I declare the nominations closed. I'll now ask for a motion that each of the nominees be elected to serve as director.

Mr. Chairman, I move that each of the 8 persons nominated be elected as directors of the company, to hold office until the close of the next Annual Meeting of Shareholders or until the successors are duly elected or appointed.

Thank you, [ Mike ]. Is there a seconder?

Mr. Chairman, I second the motion.

Thank you, [ Stacy ]. We'll now address any questions or comments from shareholders or proxy holders that are directly related to the election of directors. Have any questions or comments been raised?

John, we do have one question that's been asked just with regards to why we have -- are going to have -- I'll just read it to you. "I'd like to know why Touchstone has appointed more Board members when the production is only 1,300 [ bop per day ]. There should be a reduction in replacement instead of expanding. Why does Touchstone have 8 members for such a small company?" I think what -- the answer to that question is that we did -- at the Board level, we did a survey and a matrix of looking at skill sets. It's looking at also diversity on the Board and areas that we could add to, and we felt that it was prudent to expand that in order to meet all of those different skill sets. So that's the reason for that. And I don't think we need to discuss that, but it is a comment that came up.

Thank you, Paul. Are there any other questions?

No. That's the only question that we received.

Okay, thank you. The motion has been recorded and will be voted upon at -- after all other items of business have been discussed. The next item of business is the appointment of Ernst & Young LLP chartered professional accountants as auditors of the company for the ensuing year. I will now ask for a motion on this matter.

Mr. Chairman, I move that Ernst & Young LLP be appointed as auditors of the company to hold office until the close of the next Annual Meeting of Shareholders or until their successor is appointed at such remuneration as may be determined by the Board of Directors and that the Board of Directors be authorized to fix such remuneration.

Thank you, [ Mike ]. Is there a seconder?