Canfor Corporation Notice of Annual General Meeting of Shareholders
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CANFOR CORPORATION NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS To: The Common Shareholders of Canfor Corporation Notice is hereby given that the Annual General Meeting (the “Meeting”) of the Common Shareholders of Canfor Corporation (the “Company”) will be held at the office of the Company located at 100-1700 75th West Avenue, Va ncouver, British Columbia, V6P 6G2, on Thursday, April 23, 2020, at 1:00 pm for the following purposes: 1. To receive and consider the consolidated financial statements of the Company and its subsidiaries for the fiscal year ended December 31, 2019 a nd the report of the auditors thereon; 2. To fix the number of Directors of the Company; 3. To elect the Board of Directors of the Company for the ensuing year; 4. To appoint auditors for the ensuing year; a nd 5. To transact such other business as may properly come before the Meeting. DATED at Vancouver, British Columbia this 19th day of March, 2020. By Order of the Board of Directors David M. Calabrigo, QC Corporate Secretary An Information Circular accompanies this Notice of Annual General Meeting. The Information Circular contains details of matters to be considered at the Meeting. The Company’s Annual Report is a vailable electronically on the Company’s website at www.canfor.com/Investor-Relations or upon request at [email protected]. The Annual Report includes consolidated financial statements of the Company for the year ended December 31, 2019 and the auditors’ report thereon and the Management’s Discussion and Analysis of Financial Condition and Results of Opera tions of the Company. A Common Shareholder who is unable to attend the Meeting in person and who wishes to ensure that its shares will be voted at the Meeting is requested to complete, date and sign the enclosed form of proxy and to deliver the form of proxy in accordance with the instructions set out in the form of proxy and the Information Circular. In light of ongoing concerns related to the spread of COVID-19, only registered shareholders, non-registered shareholders who have followed the procedures described in this Information Circular and their proxy holders will be entitled to be in attendance at the Meeting. To further mitigate the risk of the spread of this virus, the Meeting is to be ma de availa ble by live webcast and by teleconference call, a nd a ll Common Shareholders are encouraged not to attend but to vote on the matters at the Meeting by proxy, appointing a management proxyholder to limit the number of attendees, a nd view the Meeting online via the webcast or listen to the Meeting by way of teleconference call. A Common Shareholder who does not attend the Meeting in person may view the Meeting through the webcast or listen through the teleconference call, in each case commencing at 1:00 pm (Vancouver time) on April 23, 2020; however, such Common Shareholders will not be able to vote or speak at, or otherwise participate in, the Meeting via the webcast or teleconference call. A Common Shareholder who does not attend the Meeting may however also submit questions to the Company in advance of the Meeting by email which will, subject to shareholder verification by the Company and confirmation of the relevance and subject matter, be addressed at the Meeting. Webcast, teleconference call a nd email details are set out in the Information Circular which accompanies this Notice of Annual General Meeting. Following the Meeting, the webcast of the Meeting will a lso be accessible on the Company’s website at www.canfor.com until April 23, 2021. Table of Contents SOLICITATION OF PROXIES ................................................................................................... 4 RECORD DATE ....................................................................................................................... 4 APPOINTMENT OF PROXYHOLDER AND REVOCATION OF PROXIES ................................... 4 VOTING OF SHARES AND EXERCISE OF DISCRETION BY PROXYHOLDER .......................... 4 VOTING BY NON-REGISTERED SHAREHOLDERS .................................................................. 5 VOTING SHARES AND PRINCIPAL HOLDERS THEREOF ........................................................ 5 MEETING WEBCAST AND TELECONFERENCE CALL ............................................................ 5 SETTING NUMBER OF DIRECTORS ........................................................................................ 6 ELECTION OF DIRECTORS ..................................................................................................... 6 COMPOSITION OF THE JOINT MANAGEMENT RESOURCES AND COMPENSATION COMMITTEE..........................................................................................................................14 COMPENSATION DISCUSSION AND ANALYSIS ....................................................................15 SUMMARY COMPENSATION TABLE.....................................................................................20 OUTSTANDING SHARE-BASED AWARDS, OPTION-BASED AWARDS AND INCENTIVE PLAN AWARDS ...............................................................................................................................20 SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS AS AT DECEMBER 31, 2019...............................................................................................................21 PENSION PLAN BENEFITS .....................................................................................................21 PERFORMANCE GRAPH ........................................................................................................23 DIRECTOR COMPENSATION .................................................................................................24 INDEBTEDNESS OF DIRECTORS, EXECUTIVE OFFICERS AND SENIOR OFFICERS ...............25 MANAGEMENT AGREEMENT ...............................................................................................26 CORPORATE GOVERNANCE .................................................................................................26 THE BOARD OF DIRECTORS .................................................................................................27 BOARD MANDATE ................................................................................................................28 POSITION DESCRIPTIONS .....................................................................................................28 ORIENTATION AND CONTINUING EDUCATION ...................................................................28 ETHICAL BUSINESS CONDUCT .............................................................................................29 NOMINATION OF DIRECTORS...............................................................................................29 COMPENSATION ...................................................................................................................29 BOARD COMMITTEES ...........................................................................................................30 BOARD/COMMITTEE ASSESSMENTS OF EFFECTIVENESS AND RENEWAL .........................32 APPOINTMENT OF AUDITOR ................................................................................................34 AUDITOR FEES ......................................................................................................................34 ADDITIONAL INFORMATION ................................................................................................34 CANFOR CORPORATION INFORMATION CIRCULAR Dated as of March 19, 2020 (except as otherwise provided) SOLICITATION OF PROXIES This Information Circular is furnished in connection with the solicita tion by the management of Canfor Corporation (“Canfor” or the “Company”) of proxies to be used at the Annual General Meeting (the “Meeting”) of the Common Shareholders of the Company (the “Common Shareholders”) to be held at the time and place and for the purposes set forth in the notice of the Meeting accompanying this Information Circular. The solicitation will be by ma il. The cost of solicitation will be borne by the Company. RECORD DATE The directors of the Company (the “Directors”) have fixed March 19, 2020 at the close of business as the record date for determining the names of Common Shareholders of the Company entitled to receive notice of the Meeting. Each person who is entered in the central securities register of the Company at the close of business on March 19, 2020 as a holder of one or more Common Shares of the Company is entitled to attend and vote at the Meeting in person or by proxy and in the event of a poll to cast one vote for each Common Share held. APPOINTMENT OF PROXYHOLDER AND REVOCATION OF PROXIES Each of the persons named in the enclosed form of proxy is a Director or senior officer of the Company. A Common Shareholder has the right to appoint a person (who need not be a shareholder) as its nominee to attend and act for it and on its behalf at the Meeting other than the persons designated in the form of proxy accompanying this Information Circular. To exercise this right, a shareholder may insert the name in full of its nominee in the blank space provided in the form of proxy and strike out the names of the persons now designated, or complete a similar form of proxy. The proxy will not be valid unless the completed form of proxy is delivered to AST Trust Company (Canada), Suite 1600, 1066 West Hastings Street, Vancouver, British Columbia, V6E 3X1, or the Corporate Secretary of the Company, not