AGM 2020

Jun 3, 2020

Well, then with that, Ron, I'll start. I think there's maybe 15 or so people on the phone, most of them we know, maybe all of them we know. I think this is my 32nd or 33rd time to share a shareholder meeting. Again, it's the most unusual one ever. We're in the executive conference room. I'm looking at 1 stakeholder, Mike Brouillard, who probably has been at this meeting 33 times, kind of like I have been here. So he doesn't have a mask on, he should. He's about 6 feet away from me, but I think he'll be hardy. So with that, good morning, ladies and gentlemen. I'm Jay Allison, Chairman and CEO of Comstock Resources. It's my pleasure to welcome all of you this morning. It is a little bit past 10 o'clock and in the quarter through the notice of the meeting, I called to order the annual meeting of stockholders. Before proceeding to the business of the meeting, I would like to introduce Roland Burns, he's to my left, our President and CFO, who will serve as Inspector of Election for the meeting. I would also like to introduce the other directors that are nominees in addition to all of them myself, Elizabeth Davis, and I saw that she's on the phone, Morris Foster, John Jacoby, Jordan Marie and Jim Turner. Scott Hickson, I saw join the call as an audit partner and Craig Lindsay, a senior manager representing Ernst and Young, our independent auditing firm and then Jack Jacobson has formed us. He's a partner with Lockwood, our legal counsel, who is also participating on this call. If questions arise after this meeting during the discussion period that those professionals should appropriately address, I would be glad to respond. As stated in the rules of conduct governing the meeting, stockholders should not address the meeting until recognized. Should you desire to ask a question or speak during the meeting, wait for me to ask for questions. After being recognized, please identify yourself and your status as a stockholder or proxy holder and then state your point or ask your question, please. As stated in the rules of ComDoc, please limit your remarks to corporate business only and make them no longer than 2 minutes. So Mr. Burns now will now report on the mailing of the notice of the meeting in the presence of a quorum. All right. Thanks, Nate. This meeting is held pursuant to print notice distributed on April 21, 2020 to each stockholder of record as of April 6, 2020, who is entitled to vote today. A list of stockholders entitled to vote at this meeting has been for examination at the company headquarters during normal business hours for the past 10 days and is available for examination by any stockholder desiring to do so. All documents concerning the call and notice of the meeting will be followed with the records of the meeting. We have received proxies representing 189,980,509 shares of the company's voting capital stock, including 7,716,579 broker votes, which can only vote on proposal 2. This is 98% of the outstanding voting stock of the company. I hereby declare a quorum present of the meeting. This meeting is now duly convened for the purpose of transacting business properly before it. On behalf of the Board of Directors of the company, I'd like to express my appreciation to all stockholders who returned their proxies. But I'd also like to point out that most of you who returned proxies authorize the persons named in the proxy to vote on all propositions coming before the meeting. Those of you who requested ballots so that you could vote individually have been provided them. Proposal 1 is the election of 7 nominees to the Board of Directors. The first proposal to be acted upon by Stockholders is the election of our Board of Directors. Our Corporate Governance Committee has nominated me, Roland Burns, Elizabeth Davis, Morris Foster, John Jacoby, George Marie and Jim Turner for reelection to the Board of Directors. All of the nominees will serve a 1 year term until 2021 Annual Meeting of stockholders. Are there any other nominations to be properly presented? Hearing none, I declare the nominations closed. Propose a period of ratification of the formative auditors. The second proposal being submitted to shareholders for action is the ratification of the formative by the Board of Directors of Ernst and Young as independent auditor of the company. I would like to call upon Ms. Davis, Chairman of the Audit Committee, for the recommendation of the Board of Directors. Elizabeth? Mr. Chairman, the Audit Committee was assigned the responsibility of recommending auditors to be appointed by the Board of Directors. My committee is recommending the reappointment of Ernst and Young. Therefore, I move to approve the appointment of Ernst and Young to audit the financial statements of the company for 2020. You've heard the motion. Is there a second? I have second. Thank you for the second. Are there any questions or discussions? Proposal number 3, the advisory vote on executive compensation. With the 3rd proposal, we're asking our stockholders to indicate their support for our executive officer compensation as described in the proxy statement prepared for the meeting. This proposal, commonly known as say on pay proposal, gives all of our stockholders the opportunity to express their views on the executive officers' Compensation Committee, for the recommendation of the Board of Directors. Jim? Mr. Chairman, the Compensation Committee sets the objectives for Comstock's executive compensation and benefit programs and determine the compensation of Comstock's executive officers. A description of our compensation plans and practices are outlined in the proxy statement prepared for this meeting. We are asking the stockholders for an advisory vote to indicate if they support our executive compensation. Therefore, I move to the stockholders to approve the following resolution. We resolve that the compensation of the named executive officers as disclosed in the company's proxy statement for the 2020 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the compensation discussion and analysis, the 2020 summary compensation table and the other related tables and disclosures is hereby approved. Thank you, Jim. The Inspector of Boats will not collect the ballots and count the votes Since the ballots have been collected, I now declare the poll is closed. Will the Inspector of Elections please report the results of the ballots enrolled? The ballots have been counted and 178,000,000,299,539 shares voted on the election of the directors. Over 99.3% of the shares voted for the election for each of Mr. Allison, Mr. Burns, Doctor. Davis, Mr. Foster, Mr. Jacoby, Mr. Marie and Mr. Turner. The second proposal, the ratification of the appointment of Ernst and Young, had a total of 1,000,000,000 I mean, 186,000,000,309 shares voted. Of that amount, 99.9 percent voted for the ratification of Ernst and Young. The 3rd proposal, the advisory vote on compensation of our named executive officers had a total of 178,299,539 shares voted. Of that amount, 99.8 percent voted for the approval of the compensation of our named executive officers. Well, I hear a lot of players that the Board's nominees for directors have been duly elected with the appointment of Ernst and Young to audit the financial statements of the company for the year 2020 has been ratified and that the resolution of raising the compensation of the company's named executive officers have been approved. I will now conclude our annual meeting with stockholders. The meeting is adjourned. I'd like to have a make a few comments and then open it up for any questions. Going through my elementary school, junior high, high school, undergrad, master's, law degree, all this stuff. I don't know if I've ever made a 99.3, 99.9 or 99.8 in any given class on my report card or even on the heart exam. But to go through in the Dural acquisition, the Shelby purchased, the Covey Park $2,200,000,000 acquisition, issued $207,000,000 of common stock to pay them on an agreement that we were bound to pay them on, which we should do to have a bank facility and have it redidormed a couple of times and to have free cash flow to be 2,000 almost 2,000 net locations is pretty amazing when a lot of the oil and gas companies today are not even standing. So we've been playing a lot of offense. It's because of the Jerry Johnson, his commitment and their family's commitment. And to get a 99.8% approval for say on pay, It will never be any better than that. And you always expect them to get on those 200 to 99.9% and the Board, Obviously, maybe I don't include myself, but it was 6 or Tier 1 people, dollars 99,300,000 So I appreciate the 32, 33 years you've allowed me to be at the helm. I appreciate that Jerry Jones and his family have allowed me to do that. And of course, I serve at the will of the Board and the will of the major stockholder. So that's that is my comment. And I would ask if anybody else has a comment that they can they would raise it now. Any questions? Okay. I think it's adjourned. And I want to tell all of you that we are a very blessed company. We're very fortunate as a company. We're going to lean forward as a company. And we're going to keep doing the right thing in a hard market and show you that we're even better than what you think we might be. Thank you. Thank you, everybody, for participating today.