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What's inside
Business of the meeting | 9 | ||
About the nominated directors | 11 | ||
OUR ADVANCE NOTICE BY-LAW | 13 | ||
DIRECTOR MAJORITY VOTING | 13 | ||
DIRECTOR PROFILES | 14 | ||
MEETING ATTENDANCE AND COMMITTEE | |||
MEMBERSHIPS | 19 | ||
PARTICIPATION ON OTHER BOARDS AND | |||
DIRECTOR INTERLOCKS | 19 | ||
DIRECTOR EDUCATION | 20 | ||
2. | Governance | 21 | |
Governance at Capital Power | 21 | ||
SUSTAINABILITY AND CLIMATE OVERSIGHT | 22 | ||
GOVERNANCE PRACTICES | 24 | ||
About the Board | 25 | ||
ROLE AND RESPONSIBILITIES | 27 | ||
ORIENTATION AND ONGOING DEVELOPMENT.. | 29 | ||
RECRUITMENT, ASSESSMENT AND TENURE .... | 31 | ||
EQUITY, DIVERSITY, AND INCLUSION | 34 | ||
SHAREHOLDER ENGAGEMENT | 36 | ||
SHAREHOLDER PROPOSALS | 36 | ||
Board Committees | 37 | ||
AUDIT COMMITTEE | 37 | ||
PEOPLE, CULTURE, AND GOVERNANCE (PCG) | |||
COMMITTEE | 39 | ||
HEALTH, SAFETY AND ENVIRONMENT (HSE) | |||
COMMITTEE | 41 | ||
3. | Compensation | 42 | |
Director compensation | 42 |
Compensation discussion and analysis | 42 | ||
APPROACH TO COMPENSATION | 42 | ||
SHARE OWNERSHIP | 42 | ||
DECISION-MAKING PROCESS | 42 | ||
ELEMENTS OF COMPENSATION | 42 | ||
2023 details | 44 | ||
DIRECTOR COMPENSATION TABLE | 44 | ||
BREAKDOWN OF FEES EARNED | 45 | ||
SHARE OWNERSHIP | 46 | ||
Executive compensation | 47 | ||
Letter to shareholders | 47 | ||
Compensation Practices | 49 | ||
COMPENSATION DISCUSSION AND ANALYSIS .. | 50 | ||
APPROACH TO COMPENSATION | 50 | ||
DECISION-MAKING PROCESS | 54 | ||
ELEMENTS OF COMPENSATION | 56 | ||
ASSESSING PERFORMANCE | 62 | ||
COMPENSATION DECISIONS | 63 | ||
SHARE PERFORMANCE | 70 | ||
2023 details | 72 | ||
SUMMARY COMPENSATION TABLE | 72 | ||
INCENTIVE PLAN AWARDS | 75 | ||
EQUITY COMPENSATION PLANS | 77 | ||
RETIREMENT BENEFITS | 78 | ||
OTHER BENEFITS | 80 | ||
TERMINATION AND CHANGE OF CONTROL | 81 | ||
4. | FORWARD-LOOKING INFORMATION | 82 | |
5. | Other Information | 83 | |
Appendix A | 84 | ||
Board of Directors - Terms of Reference .... | 84 | ||
Appendix B | 90 | ||
Employment Contracts - Termination and | |||
Change of Control Benefits | 90 |
1
Capital Power / 2024 Management Proxy Circular
Letter to Shareholders
March 11, 2024
Dear shareholders,
On behalf of the Board of Directors ("Board") and management of Capital Power Corporation ("the Company" or "Capital Power") we cordially invite you to attend the annual meeting of shareholders which will be held at EPCOR Tower in Edmonton, Alberta at 1:00 p.m. (Mountain Daylight Time) on April 30, 2024.
Since inception, Capital Power has served a critical role to steadfastly deliver reliable, affordable energy while driving industry- leading innovation. As global priorities converge to prioritize a net zero future, our business is well-positioned to deliver reliable and affordable power today while building decarbonized power systems for tomorrow and creating real net zero power solutions for our customers.
2023 marked a milestone in the evolution and growth of Capital Power. Following a rigorous North American search process, we welcomed Avik Dey as our new President and CEO to accelerate the Company's current strategic drive towards net zero by 2045. Under Avik's leadership, the Executive Team was expanded and leadership portfolios were optimized to enhance the delivery of our strategy through corporate services, commercial business, and asset management activities. The Board is pleased to welcome Jason Comandante, Pauline McLean, Steve Wollin and May Wong to the Executive Team.
Additionally, we welcomed Carolyn Graham to our Board of Directors. With a background in finance and risk, as well as environmental, social and governance (ESG) proficiency, Carolyn's expertise has further strengthened the Board's oversight of the Company's strategy and performance.
Capital Power is positioned for long-term success thanks to the leadership of its Board members - past and present - that have made a positive impact on our business. On behalf of the Board, I would like to sincerely thank Capital Power's inaugural CEO, Brian Vaasjo, for his tremendous dedication and industry-leading contributions to the Company since its inception in 2009. I would also like to thank Katharine (Kate) Stevenson (who resigned from our Board in August 2023) and Doyle Beneby (not standing for re-election at the 2024 AGM) on behalf of the Board for their thoughtful guidance, leadership and valuable insights. We wish them all well in their retirement from service with Capital Power.
We have advanced our balanced approach to the energy transition through expanding our natural gas fleet and the ongoing development of renewables to support lower carbon generation capacity for our markets. We strategically expanded our fleet in the U.S. WECC region with the acquisition of the 265 MW Frederickson 1 facility in Washington, 1,062 MW La Paloma facility in California, and 1,092 MW Harquahala facility in Arizona - positioning us as the fifth largest natural gas IPP in North America1. Of note, the acquisition of the La Paloma and Harquahala assets was the largest transaction in our corporate history and saw strong institutional validation from both BlackRock and AIMCo. We continued to advance our Genesee Repowering project, set for completion in 2024, that will deliver significant emissions reductions for the site. We secured five new contracts for our Ontario natural gas fleet, including two battery energy storage system projects, an expansion, and two upgrades.
In 2023, our pursuit of low-carbon solutions progressed with momentum. We're pleased to have initiated construction on our 140-MW Halkirk 2 Wind project in Alberta. We secured a 25-year renewable power purchase agreement for our Maple Leaf Solar project, a 23-year clean electricity supply agreement for the Halkirk 2 Wind project, and a 15-year renewable energy agreement for the Clydesdale Solar facility. As we continue to grow our renewables footprint through our robust development pipeline, we are pleased to have procured 1 GW of responsibly produced, ultra-low carbon thin film solar modules from First Solar. Additionally, we completed a front-end engineering and design (FEED) study for our Genesee Carbon, Capture and Storage (CCS) Project and announced a partnership with Ontario Power Generation to explore nuclear energy viability in Alberta.
For 2024, we remain committed to maintaining our financial strength and disciplined growth strategy by:
- maintaining our targeted 10 year average Total Shareholder Return (TSR) of 10% to 12% which was 12.5% at the end of 2023;
- delivering high-quality growth projects, including Genesee Repowering, Halkirk 2 Wind, Maple Leaf Solar, and the Ontario thermal and battery projects; and
1 Based on net unregulated capacity utilizing S&P Global Market Intelligence database of gas-fired generation operators (November 2023) and referenced against publicly disclosed sources where available.
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Capital Power / 2024 Management Proxy Circular
- maintaining management's guidance of an annual 6% dividend increase through to 2025 supported by strong, stable cashflows.
We are proud to say that, over the past 5 years, Capital Power's average growth capital investment was $1.08 billion adding close to 4,200 MWs of net generating capacity.
Addressing equity, diversity, and inclusion (EDI) continues to be a focus for Capital Power. As of March 11, 2024, women make up 50% of our executive team and 50% of our independent director nominees. We have implemented company wide, leadership and executive compensation-linked targets for 2024, which are tied to strengthening the diversity of our operations pipeline and increasing and sustaining gender diversity at the professional level and above.
For more information related to our EDI efforts please refer to the "Equity, Diversity, and Inclusion" section on page 34 of this document.
Our 2024 Annual Meeting of Shareholders
Capital Power Corporation will hold our 2024 annual meeting of shareholders at EPCOR Tower in Edmonton, Alberta at 1:00 p.m. (Mountain Daylight Time) on April 30, 2024.
Attached is the formal notice of the meeting and the management proxy circular, which explains the items of business that will be covered at the meeting and provides important information about voting and other matters to help you decide how to vote your shares.
Shareholders who wish to vote in person may do so. If you are unable to attend the meeting in-person, we encourage you to vote by proxy. A live audio webcast will be available for interested parties to join via our website (www.capitalpower.com). We'll also archive the webcast on our website after the meeting.
The Company will only conduct the formal business of the meeting. There will not be a follow-up corporate presentation nor question period following the meeting.
If you have questions, you may contact our Investor Relations department at 1 (866) 896-4636 or investor@capitalpower.com.
Thank you for your continued support, and please be sure to vote.
Sincerely,
Jill Gardiner | Avik Dey |
Chair of the Board | President & CEO |
3
Capital Power / 2024 Management Proxy Circular
Notice of 2024 Annual Meeting of Shareholders
You're invited to attend the 2024 annual meeting of shareholders of Capital Power Corporation:
When: Tuesday, April 30, 2024
1:00 p.m. Mountain Daylight Time
Where: EPCOR Tower, 8th Floor
10423 - 101st Street NW
Edmonton, Alberta
We'll cover the following items of business:
- receive our consolidated financial statements for the year ended December 31, 2023 and the auditors' report;
- elect directors;
- appoint the auditor with compensation to be fixed by the Board on the recommendation of the Audit Committee;
- vote on our approach to executive compensation;
- approve an ordinary resolution to amend our long term incentive plan; and
- transact any other business.
The management proxy circular provides detailed information about the business of the meeting and the voting process.
You're entitled to vote at the meeting if you owned common shares of Capital Power Corporation at the close of business on March 13, 2024. You can vote by proxy or vote in person at the meeting.
Please refer to the management proxy circular to learn more about the meeting. We encourage you to vote.
By order of the Board,
Colleen Legge
Corporate Secretary
Capital Power Corporation
Edmonton, Alberta
March 11, 2024
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Capital Power / 2024 Management Proxy Circular
Management Proxy Circular
This management proxy circular (circular) has been prepared to assist those shareholders who owned common shares of Capital Power at the close of business on March 13, 2024 (record date). As a shareholder of record, you're entitled to attend our 2024 annual meeting and vote your shares, in person or by proxy. You can still vote your shares if you can't attend the meeting. A live audio webcast of the meeting will be available on our website, and we'll post a transcript of the meeting and archive the webcast on our website after the meeting.
Management is soliciting your proxy for the meeting. We pay all costs for soliciting proxies.
We plan to begin mailing the notice-and-access notice for the circular and other meeting materials to shareholders of record on or about March 25, 2024. Shareholders may access an electronic copy of the circular on our website on or about March 25, 2024.
Information in this circular is as of March 11, 2024, unless otherwise indicated.
All dollar amounts are in Canadian dollars unless otherwise indicated.
In this document:
- we, us, our, the Company, the Corporation, and Capital Power mean Capital Power Corporation
- you and your mean the shareholder or holder of our common shares
- shares or common shares mean common shares of Capital Power
Our principal and head office is in Edmonton, Alberta:
Capital Power Corporation
12th Floor
10423 - 101 Street
Edmonton, Alberta
Canada T5H 0E9
We use the notice-and-access model for delivering meeting materials to both our registered and beneficial shareholders. Registered shareholders still receive a form of proxy, and beneficial shareholders still receive a voting instruction form, which allows them to vote at the annual meeting. Registered and beneficial shareholders receive a notice with information about how they can access copies of the circular electronically rather than receiving printed copies. This alternative means of delivery is more environmentally friendly because it will help reduce paper and printing and mailing costs. These documents will be available on SEDAR+ (https://www.sedarplus.ca) and our website (www.capitalpower.com).
HOW TO OBTAIN PAPER COPIES OF THE MEETING MATERIALS
Registered and beneficial shareholders may request paper copies of the circular, at no cost, at any time up to one year from the date the circular was filed on SEDAR+.
Requests by registered and beneficial shareholders may be made to our Investor Relations department at any time prior to the meeting by dialing 1 (866) 896-4636 (within North America) or by e-mail at investor@capitalpower.com.
Requests by registered or beneficial shareholders to receive a paper copy of the circular in advance of the deadline for completing and returning proxies or voting instruction forms and the meeting date of April 30, 2024 must be received by April 18, 2024.
Please note that if you request a paper copy of the circular, you will not receive a new form of proxy or voting instruction form so you should retain the form sent to you in order to vote.
5
Capital Power / 2024 Management Proxy Circular
1. About the shareholder meeting
Voting
WHO CAN VOTE
The table below shows our authorized share capital and the number of shares outstanding as of the date of this circular:
Our share capital | Authorized # | # Outstanding |
Common shares | unlimited | 129,100,120 |
Special limited voting share | 1 | 1 |
Preferred shares | unlimited, issued in series | 25,000,000 |
You can vote if you owned common shares of Capital Power as of the close of business on March 13, 2024. Each common share entitles the owner to one vote.
The voting process is different depending on whether you own your shares as a registered or non-registered (beneficial) shareholder (see below under HOW TO VOTE).
Special limited voting share
As of March 13, 2024, EPCOR owns the one outstanding special limited voting share. This share does not have voting rights in respect of this meeting.
Preferred shares
Holders of preferred shares only have voting rights:
- as required by law;
- to satisfy conditions attached to the class of shares; or
- in circumstances where we have not paid dividends for eight quarters and the shareholder meeting occurs during the period when the dividends are in arrears.
You can find more information about the rights, privileges and restrictions of our different classes of shares in our 2023 Annual Information Form (AIF) on our external website (www.capitalpower.com).
HOW TO VOTE
You can vote by proxy, or by attending the meeting and voting in person. Voting by proxy means you're giving someone else (your proxyholder) the authority to vote for you at the meeting and it's the easiest way to vote.
You can choose anyone to be your proxyholder. The person does not need to be a shareholder, but your shares will only be voted if your proxyholder attends the meeting and votes for you. Print the person's name in the space provided on the proxy form. If you vote by proxy but do not specify a proxyholder, the Capital Power representatives named on the proxy form will act as your proxyholder.
Your proxyholder must vote your shares according to your instructions. If you do not specify your voting instructions, your proxyholder can vote as they see fit. If you do not specify your voting instructions and the Capital Power representatives named on the proxy form are acting as your proxyholder, they will vote for each item of business.
If there are any changes to the items of business, or if any new items are proposed at the meeting, your proxyholder has the authority to vote as they like. The Capital Power representatives will vote on any new or amended items using their best judgment.
Transfer agent and registrar
Computershare Trust Company of Canada (Computershare) is our transfer agent and registrar. Computershare receives, counts and tabulates the proxies on our behalf. They keep the votes confidential and only inform us of the voting results.
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Disclaimer
Capital Power Corporation published this content on 22 March 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 March 2024 17:44:04 UTC.