Custom Truck One Source, Inc. (CTOS) Earnings Call Transcript

Good morning, and welcome to the Special Meeting of Stockholders for Nesco Holdings, Inc. I would now like to turn the conference over to William Plummer, Co-Chairman of the Board of Directors of Nesco Holdings. Mr. Plummer, please go ahead.

Thank you, and good morning. Welcome to the Special Meeting of the Stockholders of Nesco Holdings, Inc. I'm Bill Plummer, Co-Chairman of the Board of Directors of Nesco Holdings, Inc., and I will act as Chairman of this meeting. Thank you for joining us today. This is the second time we are holding a meeting of our stockholders in a virtual format in light of the public health concerns related to the COVID-19 outbreak. Please note that this meeting is being recorded. However, no one attending via the webcast is permitted to use any audio recording devices. It is now 10:01 a.m. Eastern Time, and this meeting is officially called to order. I would like to introduce Ken Franke of the Carideo Group, Inc., who has been certified as our inspector of election and will assist with the tabulation of the proxies and ballots. The inspector of election has filed his signed oath of office. The meeting agenda is located on your screen, and the rules of conduct are located near the bottom of your screen, and these are available for download at any time during the meeting. The rules of conduct set forth the procedures we will follow during the meeting. Affidavits from a representative of Broadridge Financial Solutions, Inc. have been provided for this meeting, showing that a notice of special meeting and proxy statement dated January 20, 2021, and proxy in the form of fixed to the affidavit were sent out on or about January 20, 2021, to each common shareholder of record on January 19, 2021, and the record date -- that is the record date for this meeting. Notice of this meeting was first mailed on January 20, 2021, and this meeting is being held in accordance with the company's bylaws. In addition, a complete list of shareholders of record entitled to vote at this special meeting is available for inspection by shareholders during this meeting via the virtual meeting site. The inspector of election has stated that the report of attendance indicates that of the shares of Nesco common stock outstanding on the record date and entitled to vote at this meeting, at least 1/2 is present in person or by proxy. Because stockholders holding of a majority of the shares eligible to vote are represented in this meeting, a quorum is present, and the meeting is lawfully constituted and will proceed. The business to be transacted at this meeting is to vote on the following proposals set forth in Nesco's proxy statement for this special meeting, which was previously sent to holders of Nesco common stock. The first proposal has 2 main elements. It is for the purposes of complying with the applicable New York Stock Exchange rules. The first element is in connection with the agreement dated December 3, 2021, between the company and PE One Source. It covers the issuance of between 140 million and 152.6 million newly issued shares of common stock at a purchase price of $5 per share to PE One Source. It also covers the issuance of an additional 28 million newly issued shares of common stock, also at a purchase price of $5 per share, to certain investors pursuant to separate subscription agreements with Nesco. The second main element of this first proposal is in connection with Nesco's previously announced purchase agreement for Custom Truck One Source. It covers the issuance of an additional 20 million newly issued shares of common stock, also at a purchase price of $5 per share, pursuant to certain rollover agreements with affiliates of Blackstone and other Custom Truck One Source equity holders. Our second proposal is to take action on the approval of 4 separate proposals to approve the proposed charter, the form of which has been attached to the proxy statement filed with the Securities and Exchange Commission on January 20, 2021. Charter proposal A is to increase the authorized number of shares of the company's common stock from 250 million to 500 million shares. Charter proposal B will permit stockholder action by written consent in certain circumstances, meaning at any time when Platinum and its affiliates collectively beneficially own in aggregate at least 50% in voting power of the stock of Nesco that's entitled to vote generally in the election of directors, any action required or permitted to be taken at any annual or special meeting of stockholders of Nesco may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing setting forth the actions so taken shall be signed by holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon are present and voted. Charter proposal C relates to certain business combination provisions. Nesco expressly elects not to be governed by Section 203 of the Delaware General Corporation Law, or DGCL. However, the proposed charter includes provisions that are substantially the same as Section 203 of the DGCL, except that Platinum, ECP, Capitol, Blackstone and certain permitted transferees thereof are exempt. And finally, charter proposal D, Nesco's proposed charter includes certain ministerial amendments, including extension of waiver of corporate opportunities in favor of certain exempted persons, which includes Platinum, ECP, Capitol and Blackstone, and incorporates by reference the provision of the stockholders agreement of Nesco to be entered into in connection with the transaction. I now formally submit these proposals for stockholder approval. And as no other proposals have been submitted to the Corporate Secretary, we will now proceed with the proposals. If you are a registered stockholder or a beneficial owner of a valid legal proxy and have not voted or you wish to change a previously cast vote, please do so now by clicking the vote here button on the bottom of your screen. Will the shareholders entitled to vote and proxies please conclude their voting? [Voting]

It is now 10:08 Eastern Time on February 18, 2021. As of this date and time, online voting is closed. No further votes may be submitted at this time. Before we adjourn the official business portion of this meeting, I would like to provide the preliminary voting results based on the tabulation of proxies by the inspector of election received prior to today's meeting. The inspector has certified that each of the proposals were approved. The proposal for the issuance of newly issued common stock was approved with the affirmative vote of a majority of the shares of common stock present in person or by proxy at this special meeting. And the proposals to adopt to the proposed charter were approved with the affirmative vote of holders of a majority of the outstanding shares of common stock entitled to vote at the meeting. The final tabulation of these votes will appear in the Form 8-K to be filed by the company with the SEC within 4 business days. The business of today's meeting is now complete. I would like to thank all of you who have attended this meeting for your interest in Nesco. It is now 10:09 a.m. on February 18, 2021, and as of this date and time, the meeting is adjourned. Thank you.

This conference has now concluded. Thank you for attending today's presentation. You may now disconnect.