Capital Power Corporation (CPX) Earnings Call Transcript & Summary

All right. Good afternoon, ladies and gentlemen. It's just after 1:00, so I'll ask that the meeting come to order. My name is Donald Lowry, and I am the Chairman of the Board of Capital Power Corporation. In accordance with the company's bylaws, I'm pleased to act as Chair for this meeting. Welcome to Capital Power Corporation's 11th Annual Meeting of Shareholders. With me today are Brian Vaasjo, President and Chief Executive Officer; and Kate Chisholm, Senior Vice President and Chief Legal and Sustainability Officer. As part of our commitment to our shareholders to reduce and contain costs in a challenging business and economic environment, we have decided to hold a simplified formal meeting at which we will seek the approval of the necessary corporate business. Therefore, our directors and other executives will not be attending. In order to facilitate a smooth flow of the business matters we will be dealing with today, Mr. Vaasjo and Ms. Chisholm will move and second formal motions. They will be called upon as needed. As noted in our press release of April 9, 2020, due to provincial COVID-19 public health orders and recommendations regarding mass gathering and social distancing, shareholders and other guests were strongly encouraged not to attend this meeting. Opportunities were made available to these shareholders to vote in advance of the meeting. And as per our custom, this meeting is being shared via live audio webcast. An archived recording of the meeting will be available on Capital Power's website following the meeting. As indicated in our press release, we will not be doing a corporate presentation nor will there be a question or answer session following this meeting. Computershare Trust Company of Canada is the company's registrar and transfer agent for its common shares. Today, Mr. Kyle Gould of Computershare has been appointed to act as Scrutineer. In accordance with the company's bylaws, I have appointed Ms. Chisholm to act as Secretary of the meeting. Mr. Gould will report on the shareholders present in person or by proxy and compute the votes on any polls taken. At this time, we want to thank all of you who have submitted proxies in advance and remind you that only registered shareholders or duly appointed proxy holders may participate in the business of today's meeting. Under the notice and access system for communicating with shareholders, the company mailed a notice of meeting, together with a form of proxy or a voting instruction form commencing on March 25, 2020. The notice informs shareholders about the time and place of our meeting, the business of the meeting and stated that our management proxy circular was posted on our website at www.capitalpower.com/agm as well as on SEDAR. The notice also stated that any shareholder could request a printed copy of the management proxy circular in advance of today's meeting. The Secretary of the meeting has provided me with an affidavit of mailing prepared by Computershare Trust Company of Canada. She will see that this affidavit is filed with the minutes of this meeting. The Secretary of the meeting has received the report of the Scrutineer and advises me that there is a quorum present. On the basis of this report, I now declare that the meeting has been regularly called and properly constituted for the transaction of business. The Secretary of the meeting will also file a report of the Scrutineer with the minutes of this meeting. The next item of business is the presentation to the meeting of the consolidated financial statements of Capital Power for the year ended December 31, 2019, and the report of the auditors thereon. The integrated annual report of the company, which contains the consolidated financial statements together with the report of the auditors thereon and the company's management discussion and analysis was mailed to each shareholder who requested a copy. The integrated annual report is also available on the company's website. On behalf of the directors, I now place this meeting -- before the meeting, the consolidated financial statements and auditor's report thereon for the year ended December 31, 2019. Are there any questions on the consolidated financial statements? Then I declare that the consolidated financial statements and the auditors' report have been received. The next item of business is the election of directors. In accordance with the bylaws of the company and pursuant to a resolution of the Board of Directors, a total of 9 directors will be elected at today's meeting by holders of common shares. Information regarding the nominees being proposed for election is set out in the management proxy circular. As of 1:00 p.m., Wednesday, April 29, 2020, which was the deadline for receipt of proxies, management had received proxies representing 51 million shares with a clear majority of the company's outstanding common shares voted as of the record date of the meeting in favor of each of management's nominees to the Board of Directors named in the management proxy circular. We will now proceed with the nomination and election of the 9 directors to be elected by holders of common shares. Only registered holders of common shares or their duly appointed proxy holders are entitled to nominate and vote for the election of these directors. Mr. Vaasjo, may I ask you for a nomination of each of the 9 directors to be elected by holders of common shares.

Mr. Chairman, on behalf of the Board of Directors, I nominate each of the following 9 persons as named in the management proxy circular for election as directors to hold office until the close of the next annual meeting or until their successors are duly elected or appointed: Donald Lowry, Brian Vaasjo, Doyle Beneby, Jill Gardiner, Kelly Huntington, Jane Peverett, Robert Phillips, Katharine Stevenson and Keith Trent.

Thank you, Mr. Vaasjo. Ms. Chisholm, would you please second the nominations?

Mr. Chairman, I second the nomination.

Thank you, Ms. Chisholm. In the absence of receipt of notice of any further nominations in accordance with bylaw #3 of the company, I now declare that the nominations are closed. We will now proceed with the election of the nominated directors. The election of the directors will proceed by way of ballot. Votes will be cast on favor of or withheld from voting for each nominated director individually. The votes cast in favor of the election of a director nominee must represent a majority of the common shares voted at the meeting. If that is not the case, that director must tender his or her resignation for consideration by the balance of the Board, whereupon the Board must determine whether to accept or reject the resignation and must disclose any decision not to accept the resignation within 90 days of the annual meeting. Only registered holders of common shares or their duly appointed proxyholders are entitled to vote on the election of these director nominees. Many shareholders present will have already filed their proxies. Unless they wish to withdraw their proxy, these shareholders should not complete a ballot since their shares will be voted in accordance with the instructions contained in the proxies granted to their proxyholders. I request that the Scrutineer hand out ballots to each registered holder of common shares and a proxyholder who has not already voted by proxy or completed a ballot. If you are a registered holder of common shares or a proxyholder and have not already voted by proxy or completed a ballot, would you please raise your hand now so that Scrutineer can see you? Since you raised your hand, okay? Please vote on the ballot by marking X opposite the names of the nominees for whom you wish to vote? Please sign and print your name in the places indicated at the bottom of the ballot and return your completed ballot to the Scrutineer. The Scrutineer will collect the ballots, count the vote and prepare the final Scrutineer's report reflecting the results of the proxies and ballots. A report on the voting results will be filed on SEDAR. In addition, we will publish the results for this voting in next year's management proxy circular. Thank you. The Scrutineer will continue to tabulate the ballot and prepare their final report. However, as there are 9 directors to be elected by the holders of the common shares and there are 9 nominees, I do declare Brian Vaasjo, Doyle Beneby, Jill Gardiner, Kelly Huntington, Jane Peverett, Robert Phillips, Katharine Stevenson, Keith Trent and myself, Donald Lowry, to be duly elected directors of the company. Next on the agenda is the appointment of the auditor. Management holds proxies for common shares representing in excess of 54 million votes, which represents more than 51% of the total eligible votes for this motion. Ms. Chisholm, may I have a motion to appoint the auditor of the company?

Mr. Chairman, I move that KPMG LLP Chartered Accountants be appointed auditor of the company to hold office until the close of the next annual meeting of shareholders with compensation to be fixed by the Board on the recommendation of the Audit Committee.

Thank you, Ms. Chisholm. Mr. Vaasjo, will you second the motion?

Mr. Chairman, I second the motion.

Thank you, Mr. Vaasjo. All those in favor of the motion, please signify by raising your hands. [Voting]

Contrary? [Voting]

I declare the motion carried. Next on the agenda is the advisory vote on executive compensation, also known as shareholder say on pay. This is the 9th year that Capital Power Corporation has conducted an advisory vote with respect to executive compensation. Management holds proxies for common shares representing 50 million votes, which in turn represents another clear majority of the total eligible votes for this motion. As Capital Power's approach to executive compensation has been discussed in the management proxy circular, I do not propose to reiterate details now. Mr. Vaasjo, may I have a motion regarding this matter?

Mr. Chairman, I move that it be resolved on an advisory basis and not to diminish the role and responsibilities of the Board of Directors that the shareholders accept the approach to executive compensation disclosed in Capital Power's management proxy circular delivered before its 2020 annual meeting of shareholders.

Thank you, Mr. Vaasjo. Ms. Chisholm, will you second the motion?

Mr. Chairman, I second the motion.

Thank you, Ms. Chisholm. All those in favor of the motion, please signify by raising your hands. [Voting]

Contrary? [Voting]

I declare the motion carried. That now completes the business of this meeting. There being no further business from the agenda, I'll ask Mr. Vaasjo for a motion to terminate.

Mr. Chairman, I move that the meeting be terminated.

Thank you, Mr. Vaasjo. Ms. Chisholm, will you please second the motion?

Mr. Chairman, I second the motion.

Thank you, Ms. Chisholm. All those in favor of the motion? [Voting]

Contrary? [Voting]

The motion is carried, and I now declare today's meeting terminated. Thank you.