DEF 14A of Vistra Corp.
Filed Apr 3, 2024 · FY20230001193125-24-086032
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
| Compensation Tables | 62 | | Summary Compensation Table – 2023 | 62 | | Grants of Plan-Based Awards – 2023 | 63 | | Outstanding Equity Awards at Fiscal Year-End – 2023 | 64 | | Option Exercises and Stock Vested – 2023 | 65 | | Proposal 2 – Advisory Vote on 2023 Compensation of Named Executive Officers | 72 | | Other Information | 73 | | Beneficial Ownership of Common Stock of The Company | 73 | | CEO Pay Ratio | 75 | | Pay Versus Performance | 76 | | Equity Compensation Plan Information | 80 | | Proposal 3 – To Act Upon a Resolution, on an Advisory Basis, Regarding Whether the Advisory Stockholder Vote on the Compensation of Named Executive Officers Should Occur Every One, Two or Three Years | 81 | | Proposal 4 – To Approve an Amendment to the 2016 Incentive Plan | 82 | | Audit Committee Report | 89 | | Independent Registered Public Accounting Firm | 91 | | Principal Accountant Fees | 91 | | Proposal 5 – Ratification of Deloitte & Touche LLP (“Deloitte”) as the Company’s Independent Registered Public Accounting Firm for the Year Ending December 31, 2024 | 92 | | Questions and Answers and Additional Information | 93 | | Annex A Vistra Corp. – Non-GAAP Reconciliations | Annex A–1 | | Appendix A Vistra Corp. – 2016 Omnibus Incentive Plan | Appendix A–1 |
2023 COMPENSATION HIGHLIGHTS
| | Clawback policy in place for performance-based incentive awards | | | No tax gross-ups for executive officers (other than for relocation expenses under a program that is generally available to all employees) | | | Stock ownership guidelines applicable to our Chief Executive Officer and President and Executive Vice Presidents, including the Named Executive Officers (“NEOs”), and non-employee directors |
2023 COMPENSATION HIGHLIGHTS
| | “Double trigger” change in control benefits that require both the occurrence of a change in control and a qualifying termination of the NEO, meaning that the executive cannot trigger these benefits themselves | | | Independent compensation consultant hired by and reporting to Social Responsibility & Compensation Committee |
DIRECTOR NOMINEE HIGHLIGHTS
DIRECTOR NOMINEE HIGHLIGHTS Our director nominees collectively represent an extensive and diverse mix of skills, knowledge and experiences that are well-suited to our business.
Director Nominee Expertise
Director Nominee Expertise
Director Nominee Expertise
| | Corporate Governance/Public Board Experience | | | 9/10 | | | Finance/Accounting | | | 9/10 | | | Industry Expertise | | | 9/10 | | | Public Company Executive | | | 6/10 |
Director Nominee Expertise
| | Risk Management/Compliance | | | 9/10 | | | Strategy/Transactional | | | 9/10 | | | Climate Change and Sustainable Strategy/Policy(1) | | | 5/10 | | | Human Capital Management/DEI(2) | | | 7/10 |
Director Nominee Expertise
| (1) Climate Change and Sustainable Strategy/Policy: Expertise in climate change, climate-related risk management, and sustainability matters, including through formal certification programs or training or participating in significant continuing education on climate science and the technologies, stakeholders, and economic theories that have emerged to prevent climate change, or through a CEO position or other senior executive role with responsibility for managing climate change and its associated risks, and sustainability issues as business imperatives. |
Director Nominee Expertise
| (2) Human Capital Management/Diversity, Equity and Inclusion (“DEI”): Experience or expertise through a CEO position, human resources leadership role, or other senior executive role in the management and development of human capital, including management of a large workforce, compensation, company culture, and other human capital issues. With respect to DEI, responsibility for establishing, evaluating, overseeing, or promoting DEI goals and practices in a corporate or non-profit setting as a director or senior executive. |
Director Nominee Expertise
| | | | | | | | | | Corporate Governance / Public Board Experience | Finance / Accounting | Industry Expertise | Public Company Executive | Risk Management / Compliance | Strategy/ Transactional | Climate Change and Sustainable Strategy/Policy | Human Capital Management / Diversity, Equity & Inclusion |
Director Nominee Expertise
| | 2024 Proxy Statement | 5 |
Key Attributes of Director Nominees
Key Attributes of Director Nominees
DIRECTOR NOMINEES
DIRECTOR NOMINEES Each nominee listed below currently serves as a director of the Board. The director nominees listed below intend to serve, if elected, on the Board as directors until the 2025 Annual Meeting and until their successors have been elected and qualified. The director nominees are set forth below:
DIRECTOR NOMINEES
| Experience, Qualifications & Skills(1) | | | | | | | | | | | Scott B. Helm Director, Chairman of the Board | Director since: 2017 Age: 59 Independent | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | | | Hilary E. Ackermann Director, Chair of the Sustainability & Risk Committee | Director since: 2018 Age: 68 Independent | 🌑 | 🌑 | 🌑 | | 🌑 | 🌑 | 🌑 | 🌑 | | Arcilia C. Acosta | Director since: 2020 Age: 58 Independent | 🌑 | 🌑 | 🌑 | | 🌑 | 🌑 | | 🌑 | | Gavin R. Baiera | Director since: 2016 Age: 48 Independent | 🌑 | 🌑 | 🌑 | | | 🌑 | | 🌑 | | Paul M. Barbas Director, Chair of the Nominating & Governance Committee | Director since: 2018 Age: 67 Independent | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | | 🌑 | | James A. Burke President and Chief Executive Officer and Director | Director since: 2022 Age: 55 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | | Lisa Crutchfield Director, Chair of the Social Responsibility & Compensation Committee | Director since: 2020 Age: 61 Independent | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | | | Julie A. Lagacy | Director since: 2023 Age: 57 Independent | 🌑 | 🌑 | | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | | John W. (Bill) Pitesa Director, Chair of the Nuclear Oversight Committee | Director since: 2024 Age: 66 Independent | | | 🌑 | | 🌑 | | | | | John R. Sult Director, Chair of the Audit Committee | Director since: 2018 Age: 64 Independent | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | 🌑 | | 🌑 |
DIRECTOR NOMINEES
| (1) All five Board Committees are independent. |
DIRECTOR NOMINEES
| | The Board of Directors recommends that stockholders vote FOR the election of these director nominees to the Board. |
DIRECTOR NOMINEES
| | | | | | | | | | Corporate Governance / Public Board Experience | Finance / Accounting | Industry Expertise | Public Company Executive | Risk Management / Compliance | Strategy / Transactional | Climate Change and Sustainable Strategy / Policy | Human Capital Management / Diversity, Equity & Inclusion |
DIRECTOR NOMINEES
| 8 | 2024 Proxy Statement | |
DIRECTOR NOMINEE BIOGRAPHIES
DIRECTOR NOMINEE BIOGRAPHIES
DIRECTOR NOMINEE BIOGRAPHIES
| Scott B. Helm Chairman of the Board | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Industry Expertise • Public Company Executive • Risk Management/Compliance • Strategy/Transactional • Climate Change and Sustainable Strategy/Policy | | Director Since: 2017 Age: 59 | Board Committees: None | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Mr. Helm has served as Chairman of the Board since October 2017. For over a decade, Mr. Helm has been a private investor based out of Baltimore, Maryland. Previously, Mr. Helm was a founding partner of Energy Capital Partners, a private equity firm focused on investing in North American energy infrastructure. Before that, he served as Executive Vice President and Chief Financial Officer at Orion Power Holdings, Inc., a publicly listed company that owned and operated power plants. Mr. Helm began his career at Goldman, Sachs & Co., first working in the fixed income division, then moving to the investment banking division. Mr. Helm also serves on the board of the Chesapeake Shakespeare Company. Mr. Helm received a bachelor’s degree in business administration from Washington University in St. Louis. Mr. Helm has extensive financial and industry knowledge. His specific experience in the energy industry and significant financial and executive experience, including his service as a founding partner of an energy infrastructure private equity fund and public company chief financial officer in the utilities sector, allow him to provide valuable guidance and knowledge to the Board and enable him to lead effectively in his capacity as Chairman.
DIRECTOR NOMINEE BIOGRAPHIES
| | 2024 Proxy Statement | 9 |
DIRECTOR NOMINEE BIOGRAPHIES
| Hilary E. Ackermann | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Industry Expertise • Risk Management/Compliance • Strategy/Transactional • Climate Change and Sustainable Strategy/Policy • Human Capital Management/Diversity, Equity & Inclusion | | Director Since: 2018 Age: 68 | Board Committees: Sustainability & Risk (Chair), Nuclear Oversight | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Ms. Ackermann served as a director of Dynegy Inc. (“Dynegy”) from October 2012 until Dynegy’s merger with Vistra in April 2018 and joined the Board in conjunction with the Company’s acquisition of Dynegy. Ms. Ackermann was Chief Risk Officer with Goldman Sachs Bank USA from October 2008 to 2011. Ms. Ackermann began her career at Goldman Sachs in 1985 and served as Managing Director, Credit Department of Goldman, Sachs & Co., as VP, Credit Department, and as an Associate in the Credit Department prior to her role as Chief Risk Officer. Prior to joining Goldman, Ms. Ackermann served as Assistant Department Head of the Credit Department of Swiss Bank Corporation (now known as UBS). Ms. Ackermann served on the private board of directors and audit committee of Credit Suisse Holdings (USA), Inc. from January 2017 through December 2022, and served as chair of the risk committee, of Credit Suisse Holdings (USA), Inc. She currently serves on the private board and the audit committee, and serves as chair of the risk and compliance committee, of each of Hartford Series Fund, Inc., Hartford HLS Series Fund II, Inc., The Hartford Mutual Funds, Inc. and The Hartford Mutual Funds II, Inc. She previously served on the public board of directors of Apollo Investment Corporation. Ms. Ackermann received a bachelor’s degree in Russian from Georgetown University. Ms. Ackermann brings extensive experience assessing credit for major banking institutions, covering a variety of industries, including the power generation, electrical utilities and natural resources sectors, as well as in-depth coverage of commodities trading, including oil, natural gas and power as a risk manager. Ms. Ackermann currently serves as the Chair of the Sustainability & Risk Committee, where she contributes significantly to the review and evaluation of our enterprise risk assessment, risk management goals, management and tracking of environmental risks and opportunities, as well as external sustainability report.
DIRECTOR NOMINEE BIOGRAPHIES
| 10 | 2024 Proxy Statement | |
DIRECTOR NOMINEE BIOGRAPHIES
| Arcilia C. Acosta | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Industry Expertise • Risk Management/Compliance • Strategy/Transactional • Human Capital Management/Diversity, Equity & Inclusion | | Director Since: 2020 Age: 58 | Board Committees: Audit, Nominating & Governance | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Ms. Acosta has served on the Board since 2020. Ms. Acosta has served as the CEO of CARCON Industries and Construction, a full-service construction firm, since 2000 and as the Founder and CEO of Southwestern Testing Laboratories, a geotechnical engineering and construction materials testing firm, since 2003. Ms. Acosta has served on the corporate boards of Magnolia Oil and Gas Corporation since 2017 and Veritex Holdings, Inc. since 2021. Prior board service includes ten years as a director of Energy Future Holdings Corporation, Legacy Texas Financial Group, N.A. from 2015 to 2019, and ONE Gas, Incorporated from July 2018 through February 2020. In addition, Governor Abbott appointed Ms. Acosta to several prominent positions: as one of three Co-Chairs of the 2023 Texas Inaugural Committee in November 2022, to the Texas Tech University Board of Regents for a six-year term in April 2021, to the Texas Higher Education Coordinating Board for a three-year term in March 2016, and in March 2020 to the Strike Force to Open Texas for COVID-19. Ms. Acosta’s civic boards include the Communities Foundation of Texas, Junior League of Dallas Community Advisory Board, and the Dallas Citizens Council where she was recently named Chairman to serve from 2023 through 2026. Ms. Acosta graduated from Texas Tech University and completed the Harvard University Business School Corporate Governance Program. Ms. Acosta brings extensive experience in executive management, operations, safety, construction management and engineering management. In addition, she has served on the boards of directors of other publicly traded and private companies, including oversight responsibilities on matters relating to executive compensation, corporate governance, and audit. Ms. Acosta currently serves on the Company’s Audit and Nominating & Governance Committees.
DIRECTOR NOMINEE BIOGRAPHIES
| | 2024 Proxy Statement | 11 |
DIRECTOR NOMINEE BIOGRAPHIES
| Gavin R. Baiera | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Industry Expertise • Strategy/Transactional • Human Capital Management/Diversity, Equity & Inclusion | | Director Since: 2016 Age: 48 | Board Committees: Social Responsibility & Compensation, Sustainability & Risk | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Mr. Baiera has served on the Board since 2016. Mr. Baiera is a senior managing director, partner, and portfolio manager at Centerbridge Partners, L.P, which is a multi-strategy private investment firm focused on private equity, credit, and real estate, and the CEO of Overland Advantage, a business development company focused on direct lending. He previously served as a managing director at Angelo, Gordon & Co., where he was the global head of the firm’s corporate credit activities and portfolio manager for its distressed funds. Mr. Baiera was also a member of the firm’s executive committee. Prior to joining Angelo, Gordon in 2008, Mr. Baiera was the co-head of the strategic finance group at Morgan Stanley, which was responsible for all origination, underwriting, and distribution of restructuring transactions. Prior to that, Mr. Baiera worked at General Electric Capital Corporation, concentrating on underwriting and investing in restructuring transactions. Mr. Baiera has served on numerous boards of directors including, most recently, MACH Gen, Orbitz Worldwide, and Travelport Worldwide. He received a bachelor’s degree in economics and finance from Fairfield University and a Master of Business Administration from the University of Southern California. Mr. Baiera has extensive experience in corporate finance and strategic business planning activities. In addition, he has served on the boards of directors of other publicly traded and private companies, including oversight responsibilities on matters relating to executive compensation and compensation strategy, making him a valuable member of the Board and the Social Responsibility & Compensation Committee and the Sustainability & Risk Committee.
DIRECTOR NOMINEE BIOGRAPHIES
| 12 | 2024 Proxy Statement | |
DIRECTOR NOMINEE BIOGRAPHIES
| Paul M. Barbas | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Industry Expertise • Public Company Executive • Risk Management/Compliance • Strategy/Transactional • Human Capital Management/Diversity, Equity & Inclusion | | Director Since: 2018 Age: 67 | Board Committees: Nominating & Governance (Chair), Nuclear Oversight | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Mr. Barbas has served on the Board since 2018. Mr. Barbas previously served on the board of Dynegy from October 2012 until Dynegy’s merger with Vistra in April 2018 and joined the Board in conjunction with the Company’s acquisition of Dynegy. Mr. Barbas previously served as president and chief executive of DPL Inc. and its principal subsidiary, The Dayton Power and Light Company (DP&L), and he also served on the boards of DPL Inc. and DP&L. He also previously served as executive vice president and chief operating officer of Chesapeake Utilities Corporation, a diversified utility company engaged in natural gas distribution, transmission, and marketing, propane gas distribution and wholesale marketing, and other related services, and he was executive vice president of Allegheny Power. Mr. Barbas also served on the public boards of Pepco Holdings, Inc. and El Paso Electric, Inc. Mr. Barbas also serves as a volunteer at the Scorton Creek Game Farm, helping to maintain trails and conservation land overseen by the Massachusetts Division of Fisheries and Wildlife. Mr. Barbas received a bachelor’s degree in economics from College of the Holy Cross and a Master of Business Administration in finance and marketing from the University of Massachusetts. Mr. Barbas brings extensive utility, management and oversight experience, having served in executive management positions with various utility and other companies. He also has a broad background in finance and marketing and brings a strong understanding of power operations and energy markets. In addition, he had oversight of information technology functions while at DPL and was responsible for several financial systems implementations during his career at GE. He also brings to the Board substantive knowledge about a variety of issues related to the Company’s business and currently serves as Chair of the Nominating & Governance Committee, where he contributes significantly to the oversight responsibilities and strategic direction of the Company’s corporate governance policies.
DIRECTOR NOMINEE BIOGRAPHIES
| | 2024 Proxy Statement | 13 |
DIRECTOR NOMINEE BIOGRAPHIES
| James A. Burke President & Chief Executive Officer | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Industry Expertise • Public Company Executive • Risk Management/Compliance • Strategy/Transactional • Climate Change and Sustainable Strategy/Policy • Human Capital Management/Diversity, Equity & Inclusion | | Director Since: 2022 Age: 55 | Board Committees: None | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Mr. Burke has served as the President and Chief Executive Officer since August 1, 2022. Prior to his current role he served as President and Chief Financial Officer of the Company since December 2020. Mr. Burke previously served as Executive Vice President and Chief Operating Officer of the Company since October 2016. Prior to joining the Company, he served as Executive Vice President of Energy Future Holdings Corp. (the “Predecessor”) since February 2013 and President and Chief Executive of TXU Energy, a subsidiary of the Company, since August 2005. Previously, Mr. Burke was Senior Vice President Consumer Markets of TXU Energy. Mr. Burke started his career with Deloitte Consulting, and held a variety of roles with The Coca-Cola Company, Reliant Energy and Gexa Energy prior to TXU Energy. Mr. Burke served as the Chairman of the board of directors of Marucci Sports, a privately held business which was successfully sold to private equity in 2020. Mr. Burke is currently a board member of the Nuclear Energy Institute, the United Way Foundation of Metropolitan Dallas, Ursuline Academy of Dallas, Dallas Citizens Council, and as an advisory board member for the Tulane University Energy Institute. Mr. Burke is a graduate of Tulane University, where he earned a bachelor’s degree in economics and a master’s of business administration in finance and general management. Mr. Burke is a licensed certified public accountant and has also earned the designation as a chartered financial analyst. In addition, Mr. Burke has completed the Massachusetts Institute of Technology Nuclear Reactor Technology Course. Mr. Burke’s 20 years of serving in various senior leadership positions with the Company brings to the Board significant knowledge and understanding of the Company’s assets and operations across its generation, nuclear, retail, and renewables businesses, including climate related risk management experience. The Board believes that Mr. Burke’s service as our CEO provides the Board with an important link with management and Mr. Burke’s valuable perspectives on the Company’s business, operations, and execution of its strategic plan.
DIRECTOR NOMINEE BIOGRAPHIES
| 14 | 2024 Proxy Statement | |
DIRECTOR NOMINEE BIOGRAPHIES
| Lisa Crutchfield | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Industry Expertise • Public Company Executive • Risk Management/Compliance • Strategy/Transactional • Climate Change and Sustainable Strategy/Policy | | Director Since: 2020 Age: 61 | Board Committees: Social Responsibility & Compensation (Chair) | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Ms. Crutchfield has served on the Board since 2020. Ms. Crutchfield is managing principal of Hudson Strategic Advisers, LLC, an economic analysis and strategic advisory firm to the energy, utility and government sectors since 2012. Prior to launching this consulting practice, she served as Executive Vice President and Chief Regulatory, Risk and Compliance Officer for the U.K.-based National Grid plc, a global energy provider, from 2008 to 2012. Ms. Crutchfield also served on the board of National Grid USA as an executive director. She has served in executive roles as Senior Vice President of Regulatory and External Affairs at PECO, an Exelon Company, from 2003 to 2008, Vice President and General Manager at TIAA-CREF, and Vice President of Energy Policy and Strategy at Duke Energy Corporation from 1997 to 2000. Ms. Crutchfield was appointed to the Pennsylvania Public Utility Commission as Vice Chairman in 1993 and served until 1997, earning the designation as an expert in liberalizing the electric and gas markets. She began her career as a commercial and investment banker. Ms. Crutchfield currently serves on the boards of two other publicly traded companies, Fulton Financial Corporation since 2014 and Fortis Inc. since 2022, and previously served on the public board of Unitil Corporation. Ms. Crutchfield earned a bachelor’s degree in economics and political science from Yale University and a Master of Business Administration with distinction in finance from Harvard Business School. Ms. Crutchfield is also a Leadership Fellow of the National Association of Corporate Directors (NACD). Ms. Crutchfield brings extensive experience leading corporate teams and has extensive knowledge of the financial industry and business practices with expertise in risk mitigation, compliance, and regulatory matters. As demonstrated by her officer roles at Duke Energy Corporation and Exelon and as utility executive at National Grid, she has extensive experience in sustainability. In addition, she has written state and federal legislation relating to renewable energy regulation, and has advised numerous utilities on the long-term implications of a competitive energy market in their respective states. She has served on the boards of several other publicly traded and privately held companies including on their compensation, governance, and risk committees. Ms. Crutchfield currently serves as the Chair of the Social Responsibility & Compensation Committee.
DIRECTOR NOMINEE BIOGRAPHIES
| | 2024 Proxy Statement | 15 |
DIRECTOR NOMINEE BIOGRAPHIES
| Julie A. Lagacy | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Public Company Executive • Risk Management/Compliance • Strategy/Transactional • Climate Change and Sustainable Strategy/Policy • Human Capital Management/Diversity, Equity & Inclusion | | Director Since: 2023 Age: 57 | Board Committees: Social Responsibility & Compensation, Sustainability & Risk | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Ms. Lagacy has served on the Board since 2023. Ms. Lagacy was chief sustainability and strategy officer at Caterpillar Inc., a manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives, from November 2021 through January 2023. Ms. Lagacy began her career with Caterpillar in 1988 and served as product and commercial manager from 1999 until 2004, human resources manager from 2004 until 2006, senior business resource manager (Global Mining) from 2006 until 2012, and chief financial officer (Global Mining) from 2012 until 2013. From 2013 until 2014, Ms. Lagacy served as vice president (Financial Services Division) and served as vice president of global information services and chief information officer from 2014 until 2020. Before being named Caterpillar’s chief sustainability and strategy officer, she served as vice president of enterprise strategy from 2020 to October 2021. Ms. Lagacy previously served on the public board of RPM International Inc., provider of specialty coatings, sealants, building materials and related services, from 2017 to 2023. In addition, Ms. Lagacy will stand for election to the board of directors of Nutrien Ltd., a leading provider of crop inputs and services, at Nutrien’s annual meeting of shareholders in May 2024. Ms. Lagacy also serves on the board of the Illinois Cancer Care Charitable Foundation. She earned dual bachelor’s degrees in Management and Economics from Illinois State University, an M.B.A. degree from Bradley University, a Certificate in Cybersecurity Oversight from Carnegie Mellon University’s Software Engineering Institute, and is a Certified Management Accountant. Ms. Lagacy brings extensive executive management experience, including financial, strategic, technology, cybersecurity, ESG, sustainability, management development, acquisitions, and capital allocation. Specifically with regard to cybersecurity matters, Ms. Lagacy earned a Certificate in Cybersecurity Oversight from Carnegie Mellon University’s Software Engineering Institute. She currently serves on the Social Responsibility & Compensation Committee and the Sustainability & Risk Committee.
DIRECTOR NOMINEE BIOGRAPHIES
| 16 | 2024 Proxy Statement | |
DIRECTOR NOMINEE BIOGRAPHIES
| John W. (Bill) Pitesa | | Experience, Qualifications & Skills • Industry Expertise • Risk Management/Compliance | | Director Since: 2024 Age: 66 | Board Committees: Nuclear Oversight (Chair) | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Mr. Pitesa was appointed to the Board in March 2024. Mr. Pitesa has spent his entire career in the nuclear industry. From 2020 until the Merger, Mr. Pitesa served on the board of directors of Energy Harbor where he was the chair of the Nuclear Committee of Energy Harbor. He retired in 2018 after working at the Nuclear Energy Institute (NEI) as chief nuclear officer. Previously, Mr. Pitesa served as chief nuclear officer for Duke Energy where he first joined in 1980 and served in numerous management positions, including serving two years as a loaned employee to the Institute of Nuclear Power Operations (INPO). During that time, he also supported the International Atomic Energy Agency (IAEA) and the World Association of Nuclear Operators (WANO) by serving on nuclear plant review teams. Mr. Pitesa holds a Bachelor of Science degree in electrical engineering from Auburn University. He is a registered professional engineer in North Carolina and a graduate of Harvard’s Advanced Management Program. Mr. Pitesa, through his 38 years of experience at Duke Energy, including executive experience as chief nuclear officer, brings expertise in the nuclear energy field and in leading highly-technical organizations through complex tactical and strategic decisions. His specific experiences integrating the Progress Energy and Duke Energy nuclear organizations and processes into a single, high performing nuclear fleet and serving on the Energy Harbor board of directors make him uniquely well-qualified to provide oversight to our nuclear operations and the integration of the Energy Harbor nuclear plants as Chair of our Nuclear Oversight Committee.
DIRECTOR NOMINEE BIOGRAPHIES
| | 2024 Proxy Statement | 17 |
DIRECTOR NOMINEE BIOGRAPHIES
| John R. (J. R.) Sult | | Experience, Qualifications & Skills • Corporate Governance/Public Board Experience • Finance/Accounting • Industry Expertise • Public Company Executive • Risk Management/Compliance • Strategy/Transactional • Human Capital Management/Diversity, Equity & Inclusion | | Director Since: 2018 Age: 64 | Board Committees: Audit (Chair) | |
DIRECTOR NOMINEE BIOGRAPHIES
Biographical Information: Mr. Sult has served on the Board since 2018. Mr. Sult previously served on the board of Dynegy and joined the board in conjunction with the company’s acquisition of Dynegy. Previously, he was executive vice president and chief financial officer of Marathon Oil Corporation and was executive vice president and chief financial officer of El Paso Corporation prior to that. Prior to joining El Paso, Mr. Sult served as vice president and controller of Halliburton Energy Services. Prior to joining Halliburton, Mr. Sult was an audit partner with Arthur Andersen LLP. Mr. Sult currently serves on the board and is chair of the nominating and corporate governance committee of Sitio Royalties, Corp., a public company, joining the board following the company’s merger with Brigham Minerals, Inc., a public company, where he previously served on the board. In addition, Mr. Sult previously served as a director of Jagged Peak Energy, Inc., a public company, as well as the general partner of El Paso Pipeline Partners, L.P., a public company. Mr. Sult serves as a member of the Advisory Board of Boys and Girls Country of Houston, Inc., a non-profit entity, previously serving as a member of the Executive Committee of the Board of Directors and Chairman of the Strategic Planning Committee. Mr. Sult received a bachelor’s degree with special attainments in commerce from Washington & Lee University and is a licensed certified public accountant in the State of Texas. Mr. Sult, through his experience in senior executive financial positions with large public companies, brings significant knowledge of accounting, capital structures, finance, financial reporting, strategic planning and forecasting to the Board. Mr. Sult has extensive knowledge of the energy industry. As a CFO, he also has had leadership responsibility for the information technology organization in a Fortune 500 company. Further, he has served as an audit partner at a major accounting firm, which, in addition to his other experience, qualifies him as an “audit committee financial expert.” He currently serves as the Chair of the Audit Committee, where he contributes significantly to the oversight of the integrity of our financial statements, internal controls and ethics and compliance functions.
DIRECTOR NOMINEE BIOGRAPHIES
| 18 | 2024 Proxy Statement | |
Executive Compensation and Oversight of Risks Related to Compensation Policies
| • | earnings goals under the Company’s Executive Annual Incentive Plan (“EAIP”) are based upon its audited financial statements and the Company believes that the goals are attainable without the need to take inappropriate risks or make material changes to the Company’s business or strategy; |
Executive Compensation and Oversight of Risks Related to Compensation Policies
| • | Named Executive Officers who receive performance based incentive awards under the EAIP and the Vistra Corp. 2016 Omnibus Incentive Plan (as amended and restated, the “2016 Incentive Plan”) are required to reimburse the Company (commonly referred to as a “clawback”) if the Company has to prepare an accounting restatement because it is in material noncompliance with any financial reporting requirements under the federal securities laws; |
Executive Compensation and Oversight of Risks Related to Compensation Policies
| • | the Company uses awards under the 2016 Incentive Plan that are typically based upon factors that affect total stockholder return over three-year periods, such as the Performance Stock Unit (“PSU”) awards, which mitigates short-term risk taking; |
Executive Compensation and Oversight of Risks Related to Compensation Policies
| • | because incentive compensation has a large equity component, value is best realized through long-term appreciation of stockholder value, especially when coupled with the executive stock ownership guidelines, which expose those officers subject to the guidelines—namely the President and CEO and each Executive Vice President—to loss of the value of the retained equity if stock appreciation is jeopardized; and |
Emphasis on “At Risk” / Performance-Based Pay
| Base Salary | Annual Bonus Plan | Performance-Based RSUs (PSUs) | Time-Based RSUs | | Short-Term Element | | Long-Term Element | | | Not at risk | Performance-Based (at risk) | | Value Based on Stock Price (at risk) |
Emphasis on “At Risk” / Performance-Based Pay
To enhance the performance-based element of our Named Executive Officers’ total compensation, the Board increased the weighting of PSUs for the NEOs’ total 2023 long-term incentive (“LTI”) grants. Our CEO received 60% (increased from 50% in 2022) of his target LTI grant in PSUs, and our other Named Executive Officers received 55% (increased from 50% in 2022) of their respective target LTI grants in PSUs.To further emphasize the performance-based element of total compensation, the Social Responsibility & Compensation Committee approved an LTI mix of 65% for PSUs and 35% for RSUs beginning in 2024 for all of the Named Executive Officers, including our CEO. The following charts illustrate the 2023 pay mix for our CEO and the average pay mix for the other Named Executive Officers. Additional detail regarding the 2023 compensation of our Named Executive Officers is provided in the Summary Compensation Table and throughout this CD&A.
2023 Named Executive Officer Compensation Overview *
| (1) Reflects Pay Mix for our CEO, Mr. Burke, based on 2023 base salary, actual EAIP payout, and target LTI award. |
2023 Named Executive Officer Compensation Overview *
| (2) Reflects Pay Mix for our NEOs, excluding Mr. Burke, based on 2023 base salary, actual EAIP payout, and target LTI award. |
Executive Compensation Best Practices
| We Do... | We Do Not... | | ✓ Pay for Performance using a compensation structure that includes performance-based EAIP and long-term incentive plan awards that are aligned with stockholder interests ✓ Provide long-term incentive plan awards that are at-risk and performance-based and include Performance Stock Units with a multi-year performance period ✓ Engage in a rigorous process to establish total direct compensation and its components, including reviewing market and survey data sourced from our peer group of companies and our industry ✓ Have change in control benefits that are subject to “double trigger” provisions, requiring both the occurrence of a change in control event and a qualifying termination (e.g., involuntary termination without cause or resignation for good reason) ✓ Maintain stock ownership requirements for our CEO and other NEOs that require attainment of ownership levels before equity transactions can occur ✓ Have a clawback policy in place ✓ Have an independent compensation consultant that reports directly to the Social Responsibility & Compensation Committee ✓ Conduct an annual risk assessment to ensure that the structure and design of our compensation programs are not reasonably likely to result in excessive risk-taking that could have a material adverse impact on the Company ✓ Listen to stockholders by holding an advisory vote on executive compensation annually and taking the results of such vote into account when setting and reviewing our compensation practices and policies. We have had very positive results from our advisory vote on executive compensation each year the vote has been held ✓ Conduct stockholder outreach efforts to discuss topics of interest, including our executive compensation programs | × Offer supplemental executive retirement plan benefits × Engage in option backdating or re-pricing × Permit hedging or pledging of our Common Stock by directors, employees (including the Named Executive Officers), or their related persons without General Counsel approval × Encourage excessive risk or inappropriate risk taking through our incentive programs × Guarantee annual bonuses × Provide any material perquisites to executives, other than reimbursement for relocation expenses, executive physicals, and financial planning and tax advice × Provide excise tax gross-ups upon a change in control × Provide loans from the Company to any executives or directors × Permit liberal share counting or “recycling” of shares |
Compensation Determination Process
Compensation Determination Process Use of Market Data Vistra establishes target compensation levels that are consistent with market practice and internal equity considerations (including position, responsibility and contribution) relative to base salaries, annual incentives and long-term incentives, as well as with the Social Responsibility & Compensation Committee’s assessment of the appropriate pay mix for a particular position. In order to gauge the competitiveness of our compensation programs, Vistra reviews compensation practices and pay opportunities through the use of survey data for the general industry and energy services industry, including but not limited to independent power producers and utilities as well as data from a selection of our publicly traded peer companies used as the compensation peer group. Vistra attempts to position itself to attract and retain qualified senior executives in the face of competitive pressures in our relevant labor markets. Specifically, during 2023, Vistra used survey data and information regarding the pay practices of the energy services industry and general industry companies provided by our Compensation Consultant, regressed to Vistra’s revenue size. Vistra believes that revenue is an appropriate indicator of the size and complexity of an organization, which should be one of the considerations in determining compensation levels. The compensation data resulting from this analysis was a significant factor considered by the Social Responsibility & Compensation Committee with respect to its executive compensation decisions for the Named Executive Officers. During 2023, Vistra utilized the company-specific data from the compensation peer group as an additional reference point when determining executive compensation, pay practices, pay magnitude, and pay evaluation. This peer group consisted of a select group of companies that the Social Responsibility & Compensation Committee believes are representative of the industry, revenue size, and talent market in which Vistra competes. Consistent with 2022, Vistra’s compensation peer group consisted of the following companies for 2023:
Compensation Determination Process
The Social Responsibility & Compensation Committee does not target any particular level of total compensation or individual component of compensation against the peer group or relevant survey data; rather, the Social Responsibility & Compensation Committee considers the range of total compensation provided by Vistra’s peers, together with information from published surveys, in determining the appropriate mix and level of total compensation for our executives. Compensation of the CEO In determining the compensation of the CEO, the Social Responsibility & Compensation Committee annually follows a thorough and detailed process. At the end of each year, the Chair of the Social Responsibility & Compensation Committee requests a formal written assessment of the CEO’s performance from all of the Board members. The Social Responsibility & Compensation Committee reviews a summary of these assessments, prepared by the Chief Administrative Officer, along with a report from the CEO outlining performance against objectives, and the performance of Vistra’s businesses. In addition, the Social Responsibility & Compensation Committee meets—with and without the CEO—to evaluate and discuss the CEO’s performance and the performance of Vistra’s businesses. The Social Responsibility & Compensation Committee balances multiple factors in determining its recommendation for the CEO’s compensation, including ensuring that a substantial portion of the CEO’s compensation is directly linked to his performance and the performance of Vistra’s businesses and is strongly aligned with stockholders’ interests, and that his compensation is competitive with compensation paid to similarly performing executive officers with similar responsibilities in companies in our compensation peer group, and against the compensation survey data provided by the Compensation Consultant. The Social Responsibility & Compensation Committee recommends compensation for the CEO to the full Board for consideration and approval. The full Board has a fulsome discussion with the Social Responsibility & Compensation Committee regarding the recommendation and supporting data. Compensation of Other Named Executive Officers In determining the compensation of each of Vistra’s Named Executive Officers (other than the CEO), the Social Responsibility & Compensation Committee seeks the input of the CEO. At the end of each year, the CEO reviews a self-assessment prepared by each of the other Named Executive Officers and assesses the Named Executive Officer’s performance against the relevant business unit (or area of responsibility) and individual goals and objectives. The CEO reviews these assessments with the Social Responsibility & Compensation Committee and makes recommendations for the compensation of the Named Executive Officers. With that context, the Social Responsibility & Compensation Committee determines and approves the compensation for each Named Executive Officer. Role of the Compensation Consultant To add rigor to the Social Responsibility & Compensation Committee process, the Compensation Consultant provides the Social Responsibility & Compensation Committee with an update on historical and forward-looking executive compensation trends for discussion. In 2023, the Compensation Consultant also provided the Social Responsibility & Compensation Committee with survey market data and peer analysis, which the Social Responsibility & Compensation Committee referenced when determining compensation for executive officers. The Social Responsibility & Compensation Committee authorized the Compensation Consultant to interact with Vistra’s management, as needed, on behalf of the Social Responsibility & Compensation Committee.
Annual Incentive Plan
Annual Incentive Plan Summary The EAIP provides an annual performance-based cash bonus for the successful attainment of certain financial and operational performance targets that are established annually by the Social Responsibility & Compensation Committee. Under the terms of the EAIP, performance against these targets, which are set at challenging levels to incentivize exceptional performance (while at the same time balancing the needs for safety and investment in Vistra’s business), drives bonus funding. Performance Framework As a general matter, target-level performance is based on Vistra’s Board-approved financial and operational plan (the Financial Plan) for each upcoming year. The Social Responsibility & Compensation Committee sets high expectations for Vistra’s executive officers and therefore annually selects a target performance level that constitutes above average performance for the business based on the Financial Plan. Threshold and superior levels are for performance levels that are below or above Financial Plan-based expectations, respectively. Based on the level of attainment of these performance targets, an aggregate EAIP funding percentage amount for all participants is determined. Target Opportunity (as a % of Salary) Target cash bonus awards are set for each Named Executive Officer as a percentage of his or her base salary. Performance payouts on financial metrics are equal to, for any particular metric, 100% if the target level is achieved, 50% if the threshold level is achieved and 200% if the superior level is achieved. Actual performance payouts are interpolated on a linear basis for performance falling between the specified performance levels, with a maximum
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performance payout for any particular metric equal to 200%. The sum of these results determines the corporate performance payout percentage, which is then adjusted by an individual performance modifier as described below. The total maximum opportunity including the effects of the individual performance modifier is capped at 200% of target.
Annual Incentive Plan
| Name | 2023 EAIP Target%(1) | | James A. Burke President & Chief Executive Officer | 130% | | Kristopher E. Moldovan EVP & Chief Financial Officer | 85% | | Stephen J. Muscato EVP & President Wholesale Operations and Development | 100% | | Scott A. Hudson EVP & President Vistra Retail | 90% | | Stacey Doré Chief Strategy and Sustainability Officer & EVP, Public Affairs | 85% |
Annual Incentive Plan
| (1) Described as a percentage of base salary. |
Annual Incentive Plan
Setting of Financial and Operational Performance Targets for 2023 Consistent with its annual practice, the Social Responsibility & Compensation Committee conducted a robust process of evaluating the scorecard metrics for the 2023 EAIP to ensure executives are effectively incentivized across all key aspects of the business. The Social Responsibility & Compensation Committee approved scorecard metrics for the 2023 EAIP in December of 2022. The majority of our metrics are focused on financial parameters that align with stockholder value: Adjusted EBITDA, Total Costs, and Adjusted FCFbG. The targets for Adjusted EBITDA and Adjusted FCFbG were set consistent with the midpoint of Vistra’s 2023 guidance, which was issued in November 2022. In addition to these financial metrics, the Social Responsibility & Compensation Committee set goals to ensure that the management team was continuing to drive the performance of each of the key business units, Generation (via the Generation Operating Index) and Retail (via the Retail Operating Index), the Company’s ESG initiatives (via the ESG Index), and the Company’s strategic focus on the growth of the Vistra Zero portfolio (via the Vistra Zero Index). The metrics comprising the Generation Operating Index consist of core processes that lead to consistent and safe operations while also driving the Generation portion of Vistra’s financial metrics. The metrics comprising the Retail Operating Index focus on core customer operations that drive both high customer satisfaction and high performance of the Retail portion of Vistra’s financial metrics. To align management’s compensation with the Company’s important ESG and DEI goals, the metrics comprising the ESG Index include: GHG emissions reduction targets tracking to achieve 60% reduction by 2030 and net-zero by 2050; GHG-related advocacy efforts; DEI initiatives, including the implementation of various DEI programs, training and reporting enhancements, and updated recruiting efforts; and supplier diversity expansion. In addition, the Social Responsibility & Compensation Committee approved a Vistra Zero Index to align with the Company’s strategic focus on the growth of its Vistra Zero portfolio. Specific metrics and goals related to the Generation Operating Index, Retail Operating Index, ESG Index, and Vistra Zero Index are not disclosed due to the competitively sensitive nature of this information.
Annual Incentive Plan
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Annual Incentive Plan
The following table provides a summary (including relevant weighting) of the actual results and payout levels for the 2023 scorecard under the EAIP for Vistra, including the Named Executive Officers:
Annual Incentive Plan
| Named Executive Officer Vistra Scorecard Metrics | Weight | Target | Performance | Results Achieved | Weighted Average Funding | | Vistra Adjusted EBITDA(1) *($ m) | 25% | $3,560 | $4,100 | 200% | 50% | | Total Cost(2) ($ m) | 10% | $3,456 | $3,501 | 93% | 9% | | Adjusted Free Cash Flow before Growth(3) *($ m) | 25% | $1,815 | $2,422 | 200% | 50% | | Generation Operating Index (%) | 10% | 100% | 119% | 119% | 12% | | Retail Operating Index (%) | 10% | 100% | 177% | 177% | 18% | | Vistra Zero Index | 10% | 100% | 122% | 122% | 12% | | ESG Index (%) | 10% | 100% | 100% | 100% | 10% | | Total | 100% | | | | 161% |
Annual Incentive Plan
| * See Annex A for a reconciliation of non-GAAP financial measures to the most comparable GAAP measure (as defined in Annex A). |
Annual Incentive Plan
| (1) Adjusted EBITDA means Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) as adjusted for unrealized gains or losses from hedging activities, tax receivable agreement impacts, reorganization items, and certain other items described from time to time consistent with Vistra’s earnings releases. |
Annual Incentive Plan
| (2) Total Cost is calculated as the sum of total costs to operate Vistra’s business units, including (i) selling, general and administrative (SG&A) expenses, (ii) operating and maintenance (O&M) expenses, (iii) cash spend associated with capital projects, (iv) development project spend and (v) other costs incurred to operate the business. |
Annual Incentive Plan
| (3) Adjusted Free Cash Flow before Growth means cash from operating activities excluding changes in margin deposits and working capital and adjusted for capital expenditures for growth investments, other net investment activities, and other items described from time to time consistent with Vistra’s earnings releases. |
Annual Incentive Plan
Individual Performance Highlights After determining and approving the corporate performance payout percentages based on actual Company performance against the applicable performance metrics under the EAIP, the Social Responsibility & Compensation Committee and the CEO review the performance of each of Vistra’s executive officers on an individual and comparative basis. Based on this review, which includes an analysis of both objective and subjective criteria, as determined by the Social Responsibility & Compensation Committee in its sole discretion, including the CEO’s recommendations (with respect to all executive officers other than himself), the Social Responsibility & Compensation Committee approves an individual performance modifier for each executive officer. The individual performance modifier is determined on a basis independent of the corporate performance payout calculations. In accordance with the terms of the EAIP, the individual performance modifier can range from an “exceeds expectation” rating (111-150%) to a “needs improvement” rating (0-50%). To calculate an executive officer’s final annual cash incentive bonus, the corporate performance payout percentages are multiplied by the executive officer’s target incentive amount, which is computed as a percentage of annualized base salary, and then further multiplied by the executive officer’s individual performance modifier, with the maximum bonus opportunity subject to the aggregate cap of 200% of such executive officer’s target bonus under the employment agreements. Additionally, certain executives, including the Named Executive Officers, are subject to an “executive limiter” in which the EAIP is capped at 50% of each executive’s target bonus if Vistra’s Adjusted EBITDA did not meet the Adjusted EBITDA threshold performance level. In the event that such Adjusted EBITDA threshold performance level is not met, the Board has complete discretion on any final annual cash incentive bonus paid to such executives. The Social Responsibility & Compensation Committee evaluated the Company’s performance against the Adjusted EBITDA target approved in the scorecard to determine whether the executive limiter was triggered. In 2023, because Vistra’s Adjusted EBITDA exceeded the threshold performance level based on the scorecard, no “executive limiter” was applicable. Actual Awards The Social Responsibility & Compensation Committee and the Board (as applicable) certified financial results for 2023 and approved the individual performance modifiers for all Named Executive Officers, and they were paid their approved bonuses in March 2024. Based on its review of the results of 2023 performance, the Social Responsibility &
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Compensation Committee made no adjustments to the 2023 actual performance outcomes. The discussion below highlights key factors of each NEO’s individual performance used in determining the individual performance ratings. Mr. Burke, President & Chief Executive Officer: In his first full year as CEO, Mr. Burke led Vistra to strong financial performance while also successfully executing the acquisition of Energy Harbor to expand Vistra’s nuclear and retail footprint. Mr. Burke clearly defined Vistra’s purpose to the markets and developed a strong reputation for thoughtful and clear communication. The markets responded with a strong vote of confidence evident in Vistra’s stock performance in 2023. Within Vistra, Mr. Burke has continued to focus on the safety and development of the Vistra executive leadership team and employees, resulting in reduced attrition and increased engagement. As a result of Mr. Burke’s strong performance as CEO, the Board of Directors approved an above target EAIP payment for 2023. Mr. Moldovan, EVP & Chief Financial Officer: In 2023, Mr. Moldovan led the strategic structuring and financing of the Energy Harbor transaction in a manner that allowed Vistra to continue its capital allocation program. In addition, he led the process to repurchase a significant majority of outstanding rights under the Company’s Tax Receivable Agreement, which is expected to increase free cash flow over the next several years, and he completed multiple critical financing transactions during the year. Mr. Moldovan is viewed as a leader across Vistra and continues to build credibility with investors. As a result of Mr. Moldovan’s strong performance as CFO, the Social Responsibility & Compensation Committee approved an above target EAIP payment for 2023. Mr. Muscato, EVP and President, Wholesale Operations and Development: Mr. Muscato took on expanded responsibilities in 2023. Beyond continued responsibility for the commercial and development operations, Mr. Muscato began leading the fossil operations organization as well. During 2023, employee safety improved over the previous year, and the plants under his organization performed at a peak performance level throughout the year, and in particular during the periods of high heat experienced during the summer. In addition, the commercial team continued to successfully execute a well thought out hedging strategy that allowed Vistra to capture additional value. For these and other reasons, the Social Responsibility & Compensation Committee approved an above target EAIP payment for 2023. Mr. Hudson, EVP & President Vistra Retail: Mr. Hudson led the retail organization to another strong performance in 2023. The retail team outperformed its financial targets amid strong customer retention and growth. Mr. Hudson also drove innovation, successfully introducing several new retail products to the market in 2023. For these and other reasons, the Social Responsibility & Compensation Committee approved an above target EAIP payment for 2023. Ms. Doré, Chief Strategy and Sustainability Officer & EVP, Public Affairs: Most importantly, in 2023, Ms. Doré successfully led the Vistra team’s efforts to evaluate and negotiate the Energy Harbor transaction. In addition, Ms. Doré positively impacted critical market and regulatory discussions around the country in key energy markets. Ms. Doré has become a strong voice representing Vistra and is well respected within and outside of the Company. For these and other reasons, the Social Responsibility & Compensation Committee approved an above target EAIP payment for 2023. The table below provides a summary of the 2023 performance-based cash bonus for each NEO under the EAIP, applying the corporate performance payout percentage and each NEO’s respective individual performance modifier.
Annual Incentive Plan
| Name | 2023 Target (% of salary) | 2023 Target Award ($ Value)(1) | 2023 Actual Award ($) | | James A. Burke | 130% | $1,634,630 | $3,158,105 | | Kristopher E. Moldovan | 85% | $529,184 | $1,022,383 | | Stephen J. Muscato | 100% | $775,000 | $1,497,300 | | Scott A. Hudson | 90% | $559,813 | $991,429 | | Stacey Doré | 85% | $520,847 | $1,006,276 |
Annual Incentive Plan
| (1) Value of target award based on 2023 salary, as pro-rated for annual adjustments. |
Long-Term Incentive
Long-Term Incentive Equity awards made under the 2016 Incentive Plan are intended to serve as a retention and motivational tool and align the interests of Vistra’s executive officers with the interests of Vistra’s stockholders. Targeted grant values are determined based on an evaluation of internal pay equity, and compensation levels for comparable positions among
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Long-Term Incentive
peer companies, the energy services industry and general industry. Award values are benchmarked against overall market data and proxy data from Vistra’s peer group. In February 2023, the Compensation Consultant evaluated the long-term incentive program for executive officers. The Social Responsibility & Compensation Committee considered this evaluation and approved a change in the mix of awards in the LTI program for 2023 to better align with market practices and enhance the performance-based element of the LTI program, as follows:
Long-Term Incentive
| | 2022 PSU / RSU Mix | 2023 PSU / RSU Mix | | CEO | 50% / 50% | 60% / 40% | | Other NEOs | 50% / 50% | 55% / 45% |
Long-Term Incentive
LTI Awards Granted in 2023
Long-Term Incentive
| Name | Total Target Value(1) | | James A. Burke | $6,000,000 | | Kristopher E. Moldovan | $2,800,000 | | Stephen J. Muscato | $3,500,000 | | Scott A. Hudson | $2,400,000 | | Stacey Doré | $2,750,000 |
Long-Term Incentive
| (1) Reflects annual LTI awards approved by the Social Responsibility & Compensation Committee in February 2023. |
Long-Term Incentive
Performance Stock Units For 2023, the targeted equity value in the form of PSUs for the annual LTI awards was 60% for the Chief Executive Officer and 55% for all other Named Executive Officers. The number of target PSUs awarded to each executive in 2023 was determined by dividing the targeted PSU value for each executive by the closing price of the Common Stock on the trading day immediately prior to the date of grant as reported on the NYSE. For the 2023 PSU grants, the Social Responsibility & Compensation Committee approved the following performance metrics and weightings for the 2023-2025 performance period:
Long-Term Incentive
| Performance Stock Units Metrics Summary | Weight | | Adjusted FCFbG (per share) | 100% | | Relative TSR Modifier(1) | +/- 25% |
Long-Term Incentive
| (1) Based on Vistra stock performance relative to S&P 500 index constituents. |
Long-Term Incentive
The PSUs have a single performance metric of Adjusted FCFbG per share with a Relative Total Stockholder Return (“TSR”) modifier, with a three-year performance period (2023-2025) for both financial and Relative TSR metrics. The Relative TSR Modifier measures the Company’s performance relative to the S&P 500 index constituents, and applies a modifier to amounts earned based on the Adjusted FCFbG per share performance outcome as follows:
Long-Term Incentive
| Relative Performance | RTSR Modifier | | 75th%ile or higher | 1.25x | | >25th%ile to <75th%ile | No modification | | 25th%ile or lower | 0.75x |
Long-Term Incentive
If Vistra’s Absolute TSR is negative for the three-year performance period, payouts will be capped at 100% of the target number of PSUs granted regardless of actual performance. The forward-looking targeted levels for Adjusted FCFbG per share are not disclosed due to the competitively sensitive nature of this information.
Long-Term Incentive
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Long-Term Incentive
Based on its review with the Compensation Consultant, the Social Responsibility & Compensation Committee believes these metrics appropriately align and incentivize Vistra’s management team’s focus on long-term stockholder value creation in support of its capital allocation priorities. The 2023 PSUs will vest on February 24, 2026 and are settled in shares of Common Stock based on the certification of the results of the performance metrics following the performance period. The overall maximum payout cap for each NEO (including the effects of the Relative TSR Modifier) is 200% of his or her target PSU award based on actual performance against the target levels set by the Social Responsibility & Compensation Committee. Restricted Stock Units For 2023, targeted equity value in the form of RSUs for the annual LTI awards was 40% for the Chief Executive Officer and 45% for all other Named Executive Officers. The RSUs vest ratably over a three-year period to promote long-term executive retention and alignment with stockholders. Each RSU represents the right to receive one share of Common Stock as of the vesting date for the award. The number of RSUs awarded to each executive in 2023 was determined by dividing the targeted RSU value for each executive by the closing price of the Common Stock on the trading day immediately prior to the date of grant as reported on the NYSE. 2023 Equity Awards The values included in the following table reflect the total value of long-term incentive awards and the number of restricted stock units and performance stock units granted to each Named Executive Officer in 2023.
Long-Term Incentive
| Name | Target Value of 2023 Long-Term Incentive Award(1) | Number of Restricted Stock Units | Number of Performance Stock Units | | James A. Burke | $6,000,000 | 106,666 | 160,000 | | Kristopher E. Moldovan | $2,800,000 | 56,000 | 68,444 | | Stephen J. Muscato | $3,500,000 | 70,000 | 85,555 | | Scott A. Hudson | $2,400,000 | 48,000 | 58,666 | | Stacey Doré | $2,750,000 | 55,000 | 67,222 |
Long-Term Incentive
| (1) Reflects annual LTI awards approved by the Social Responsibility & Compensation Committee in February 2023. |
Long-Term Incentive
2021 PSU Results In February 2024, the Social Responsibility & Compensation Committee evaluated the results of 2023 performance, the final year in the 2021-2023 measurement period for the PSUs granted in 2021. Adjusted FCFbG per share performance targets were set for each year in the three-year performance period consistent with the Company’s annual budget plan, and PSU performance results are measured on a cumulative basis over a three-year period. Notably, the Company’s superior performance (200% of target) in 2022 and 2023 significantly offset the impact of Winter Storm Uri on 2021 performance results, resulting in a payout of 124% of target related to the Adjusted FCFbG per share metric. Vistra’s relative TSR performance was measured cumulatively over a three-year period, and the Company achieved the 95th percentile over the three-year period, resulting in a 1.25x modifier being applied to the amounts earned pursuant to the Adjusted FCFbG per share metric.
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Long-Term Incentive
Based on this review, the Social Responsibility & Compensation Committee made no adjustments to the actual performance results and certified the performance results of the 2021 PSUs for the Named Executive Officers as set forth below.
Long-Term Incentive
| 2021 PSUs Scorecard Metrics | Weight | Target | Performance(1) | Performance Payout | | Adjusted FCFbG per share ($) | 100% | $11.67 | $12.05 | 124% | | Relative TSR modifier(2) | +/-25% | >25th%ile to <75th%ile | 95th %ile | 1.25x | | | | | | 154% |
Long-Term Incentive
| (1) Reflects the cumulative performance for the three-year performance period of 2021-2023, with final results reviewed and certified by the Social Responsibility & Compensation Committee. |
Long-Term Incentive
| (2) Based on Vistra stock performance relative to S&P 500 index constituents. |
Long-Term Incentive
The following table sets forth the final number of 2021 PSUs earned by each Named Executive Officer, which is determined by multiplying the original target award for such Named Executive Officer by the cumulative payout performance percentage. The 2021 PSUs vested on February 22, 2024 and were settled in shares of Common Stock.
Long-Term Incentive
| Name | Target Award for 2021 PSUs | Final Number of PSUs Earned | | James A. Burke | 76,385 | 117,633 | | Kristopher E. Moldovan | 5,173 | 7,966 | | Stephen J. Muscato | 65,473 | 100,828 | | Scott A. Hudson | 32,409 | 49,910 | | Stacey Doré(1) | — | — |
Long-Term Incentive
| (1) Ms. Doré held no 2021 PSUs, which were granted to our other Named Executive Officers prior to her start date in 2022. |
Compensation Risk Analysis
| • | the structure of the incentive plans; |
Compensation Risk Analysis
| • | the mix of cash and equity payouts at various compensation levels; |
Compensation Risk Analysis
| • | the use of multiple financial and operational performance metrics that are readily monitored and reviewed; |
Compensation Risk Analysis
| • | the extent to which the Named Executive Officer pay program rewards short-term decisions at the risk of long-term performance; |
Compensation Risk Analysis
The Company also generally considered other compensation policies (such as clawback and anti-hedging policies), other compensation plans relating to severance and change-in-control benefits, and compensation governance. Following their assessment, our management team prepares a report, which is provided to the Social Responsibility & Compensation Committee for review. The Social Responsibility & Compensation Committee reviews the report, which is also made available to the full Board. For 2023, we concluded that there were no material issues regarding our executive pay programs, and that the design of the Company’s incentive pay plans has, overall, a low-risk profile. Based on the foregoing, the Social Responsibility & Compensation Committee and the Company’s management concluded that the risks arising from our overall compensation policies and practices are not reasonably likely to have a material adverse effect on the Company.
Benefits and Perquisites
Employment Arrangements and Severance Benefits Vistra has entered into employment agreements with each of the Named Executive Officers. Each of the employment agreements provides that certain payments and benefits will be paid upon the expiration of the agreement or an earlier termination of the Named Executive Officer’s employment under certain circumstances, including a termination without cause, a resignation for good reason and a qualifying termination of employment within a fixed period of time following a change in control of Vistra. The change in control severance benefits for the Named Executive Officers are “double trigger” benefits, requiring both (i) change in control of Vistra and (ii) a qualifying termination of employment before any applicable Named Executive Officer is entitled to receive any change in control severance payment. Vistra believes that these provisions are important in order to attract, motivate and retain the caliber of executive officers that our business requires and provide incentive for our executive officers to fully consider potential changes that are in Vistra’s and our stockholders’ best interests, even if such changes could result in the executive officers’ termination of employment.
Summary Compensation Table—2023
Summary Compensation Table—2023 The following table provides information for the fiscal years ended December 31, 2023, 2022, and 2021 regarding the aggregate compensation paid to Vistra’s Named Executive Officers.
Summary Compensation Table—2023
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($)(2) | Change in Pension Value & Non-qualified Deferred Compensation ($) | All Other Compensation ($)(3) | Total ($) | | James A. Burke President & Chief Executive Officer | 2023 | 1,262,596 | — | 5,999,985 | — | 3,158,105 | — | 32,690 | 10,453,376 | | | 2022 | 1,014,847 | — | 6,061,159 | — | 1,453,551 | — | 30,267 | 8,559,824 | | | 2021 | 853,077 | — | 3,499,961 | — | 710,613 | — | 28,865 | 5,092,516 | | Kristopher E. Moldovan EVP & Chief Financial Officer | 2023 | 627,519 | — | 2,799,990 | — | 1,022,383 | — | 38,384 | 4,488,276 | | | 2022 | 451,731 | — | 1,462,183 | — | 387,373 | — | 29,166 | 2,330,453 | | Stephen J. Muscato EVP & Chief Commercial Officer | 2023 | 772,296 | — | 3,499,988 | — | 1,497,300 | — | 23,065 | 5,792,649 | | | 2022 | 630,552 | — | 3,448,936 | — | 800,378 | — | 21,750 | 4,901,616 | | | 2021 | 605,000 | — | 2,999,973 | — | 500,546 | — | 20,427 | 4,125,946 | | Scott A. Hudson EVP & President Vistra Retail | 2023 | 621,707 | — | 2,399,985 | — | 991,429 | — | 36,396 | 4,049,517 | | | 2022 | 604,427 | — | 2,303,013 | — | 690,592 | — | 30,937 | 3,628,969 | | | 2021 | 575,385 | — | 1,484,980 | — | 431,363 | — | 33,395 | 2,525,123 | | Stacey Doré Chief Strategy and Sustainability Officer & EVP, Public Affairs | 2023 | 617,624 | 150,000 | 2,749,995 | — | 1,006,276 | — | 30,676 | 4,554,571 |
Summary Compensation Table—2023
| (1) Amounts reported with respect to RSUs granted to the Named Executive Officers reflect the grant date fair value of the award computed in accordance with ASC 718 (using the assumptions discussed in Note 19 to the Vistra Corp. Consolidated Financial Statements included in Vistra’s annual report on Form 10-K filed with the SEC on February 29, 2024 (the “Consolidated Financial Statements”)). Amounts reported with respect to PSU values are based on share price at the service inception date assuming target performance. Assuming maximum performance of the 2023 PSUs, the total maximum potential value of the equity awards granted to each NEO in 2023 would be as follows: Mr. Burke, $7,616,000; Mr. Moldovan, $3,257,934; Mr. Muscato, $4,072,418; Mr. Hudson, $2,792,502; and Ms. Doré, $3,199,767. |
Summary Compensation Table—2023
| (2) The amounts reported as “Non-Equity Incentive Plan Compensation” were earned by the respective Named Executive Officers under the EAIP. |
Summary Compensation Table—2023
| (3) The amounts for 2023 reported as “All Other Compensation” are attributable to the Named Executive Officer’s receipt of compensation as described in the table below. |
Summary Compensation Table—2023
| Name and Principal Position | Year | Matching Contribution to Thrift Plan ($)(a) | Financial Planning ($)(b) | Executive Physical ($) | Total ($) | | James A. Burke President & Chief Executive Officer | 2023 | 19,800 | 12,890 | — | 32,690 | | Kristopher E. Moldovan EVP & Chief Financial Officer | 2023 | 19,800 | 11,300 | 7,284 | 38,384 | | Stephen J. Muscato EVP & Chief Commercial Officer | 2023 | 19,559 | — | 3,506 | 23,065 | | Scott A. Hudson EVP & President Vistra Retail | 2023 | 19,596 | 12,890 | 3,910 | 36,396 | | Stacey Doré Chief Strategy and Sustainability Officer & EVP, Public Affairs | 2023 | 12,729 | 12,890 | 5,057 | 30,676 |
Summary Compensation Table—2023
For purposes of preparing this table, all perquisites are valued on the basis of the actual cost to Vistra.
Summary Compensation Table—2023
| (a) Vistra’s Thrift Plan allows participating employees to contribute a portion of their regular salary or wages to the plan. Under the Thrift Plan, Vistra matches a portion of an employee’s contributions. This matching contribution is 100% of each Named Executive Officer’s contribution, not to exceed 6% of the Named Executive Officer’s salary (with the salary capped at the annual IRS compensation limit). All matching contributions are invested in Thrift Plan investments as directed by the participant. |
Summary Compensation Table—2023
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Summary Compensation Table—2023
| (b) Vistra offers to pay for our executive officers to receive financial planning services. This service is intended to support them in managing their financial affairs, which Vistra considers especially important given the high level of time commitment and performance expectation required of our executive officers. Furthermore, Vistra believes that such service helps ensure greater accuracy and compliance with individual tax regulations by our executive officers. |
Grants of Plan-Based Awards—2023
Grants of Plan-Based Awards—2023 The following table sets forth information regarding grants of compensatory awards to the Named Executive Officers for 2023.
Grants of Plan-Based Awards—2023
| | | | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | | All Other Stock Awards: Numbers of Shares of Stock or Units (#)(3) | Grant Date Fair Value of Stock and Options Awards ($)(4) | | Name | Approval Date | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | James A. Burke | — | — | 828,750 | 1,657,500 | 3,315,000 | — | — | — | — | — | | | 2/23/2023 | 2/24/2023 | — | — | — | 80,000 | 160,000 | 320,000 | 106,666 | 5,999,985 | | Kristopher E. Moldovan | — | — | 267,750 | 535,500 | 1,071,000 | — | — | — | — | — | | | 2/23/2023 | 2/24/2023 | — | — | — | 34,222 | 68,444 | 136,888 | 56,000 | 2,799,990 | | Stephen J. Muscato | — | — | 387,500 | 775,000 | 1,550,000 | — | — | — | — | — | | | 2/23/2023 | 2/24/2023 | — | — | — | 42,778 | 85,555 | 171,110 | 70,000 | 3,499,988 | | Scott A. Hudson | — | — | 280,901 | 561,803 | 1,123,605 | — | — | — | — | — | | | 2/23/2023 | 2/24/2023 | — | — | — | 29,333 | 58,666 | 117,332 | 48,000 | 2,399,985 | | Stacey Doré | — | — | 263,553 | 527,106 | 1,054,213 | — | — | — | — | — | | | 2/23/2023 | 2/24/2023 | — | — | — | 33,611 | 67,222 | 134,444 | 55,000 | 2,749,995 |
Grants of Plan-Based Awards—2023
| (1) Based on annualized salary rate for each NEO at the end of 2023. Represents the threshold, target, and maximum amounts (where applicable) available to be earned under the EAIP for 2023 for each Named Executive Officer based on achievement of company performance metrics, which would be subject to an individual performance modifier, as determined by the Board in the case of the CEO, and by the Social Responsibility & Compensation Committee with respect to the other NEOs, to arrive at the final payout amount. Actual payments are reported in the Summary Compensation Table in the year earned under the heading “Non-Equity Incentive Plan Compensation” and described under “Annual Incentive Plan” on page 52. |
Grants of Plan-Based Awards—2023
| (2) Represents the threshold, target and maximum amounts of PSUs granted pursuant to the 2016 Incentive Plan. As described in further detail under the section entitled “Long-Term Incentive Plan,” the 2023 PSUs require performance goals to be attained over a three-year period scheduled to end on December 31, 2025. The 2023 PSUs are payable in Common Stock based on the results of market, performance and time-based criteria and will vest on February 24, 2026. |
Grants of Plan-Based Awards—2023
| (3) Represents RSUs granted pursuant to the 2016 Incentive Plan. |
Grants of Plan-Based Awards—2023
| (4) Represents the sum of (i) the grant date fair value of RSUs as computed in accordance with ASC 718 and (ii) the fair value of PSUs based on share price at the service inception date assuming target performance. |
Grants of Plan-Based Awards—2023
For a discussion of certain material terms of the employment agreements and other agreements with certain Named Executive Officers, please see “Compensation Philosophy” beginning on page 45 and “Potential Payments upon Termination or Change in Control” beginning on page 65.
Grants of Plan-Based Awards—2023
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Outstanding Equity Awards at Fiscal Year-End—2023
Outstanding Equity Awards at Fiscal Year-End—2023 The following table sets forth information regarding outstanding equity awards held by the Named Executive Officers at fiscal year-end for 2023.
Outstanding Equity Awards at Fiscal Year-End—2023
| | | Option Awards | | | | Restricted Stock Units | | | Performance Stock Units | | | Name | Year | Securities Underlying Unexercised Options (#) Exercisable | Securities Underlying Unexercised Options (#) Unexercisable | Option Exercise Price ($) | Option Expiration Date | Shares or Units of Stock that have Vested (#) | Shares or Units of Stock that have not Vested (#) | Market Value of Shares or Units of Stock that have not Vested ($)(1) | Unearned Shares or Units of Stock that have not Vested (#) | Market Value of Unearned Shares or Units of Stock that have not vested ($)(1) | | James A. Burke | 2023 | — | — | — | — | — | 106,666(2) | $4,108,774 | 160,000(5) | $6,163,200 | | | 2022 | — | — | — | — | 37,702 | 75,405(3) | $2,904,601 | 132,449(6) | $5,101,935 | | | 2021 | — | — | — | — | 50,923 | 25,462(4) | $980,796 | 76,385(7) | $2,942,350 | | | 2020 | 145,687 | — | $22.98 | 2/25/2030 | 32,637 | — | — | — | — | | | 2019 | 99,364 | — | $26.56 | 2/26/2029 | 28,237 | — | — | — | — | | | 2018 | 567,000 | — | $19.68 | 4/9/2027 | — | — | — | — | — | | | 2017 | 86,633 | — | $18.90 | 3/31/2028 | 33,333 | — | — | — | — | | | 2016 | 421,053 | — | $14.03 | 10/11/2026 | 122,324 | — | — | — | — | | Kristopher E. Moldovan | 2023 | — | — | — | — | — | 56,000(2) | $2,157,120 | 68,444(5) | $2,636,463 | | | 2022 | — | — | — | — | 17,058 | 34,119(3) | $1,314,264 | 6,727(6) | $259,124 | | | 2021 | — | — | — | — | 6,404 | 3,202(4) | $123,341 | 5,173(7) | $199,264 | | | 2020 | 20,775 | — | $22.98 | 2/25/2030 | 6,205 | — | — | — | — | | | 2019 | 14,169 | — | $26.56 | 2/26/2029 | 5,368 | — | — | — | — | | | 2018 | 45,000 | — | $19.68 | 4/9/2027 | — | — | — | — | — | | | 2017 | 10,313 | — | $18.90 | 3/31/2028 | 5,291 | — | — | — | — | | | 2016 | 49,668 | — | $13.26 | 10/25/2026 | — | — | — | — | — | | Stephen J. Muscato | 2023 | — | — | — | — | — | 70,000(2) | $2,696,400 | 85,555(5) | $3,295,579 | | | 2022 | — | — | — | — | 24,026 | 48,054(3) | $1,851,040 | 72,080(6) | $2,776,522 | | | 2021 | — | — | — | — | 43,648 | 21,825(4) | $840,699 | 65,473(7) | $2,522,020 | | | 2020 | 122,377 | — | $22.98 | 2/25/2030 | 27,415 | — | — | — | — | | | 2019 | 79,491 | — | $26.56 | 2/26/2029 | 22,590 | — | — | — | — | | | 2018 | 227,000 | — | $19.68 | 4/9/2027 | — | — | — | — | — | | | 2017 | 41,254 | — | $18.90 | 3/31/2028 | 21,164 | — | — | — | — | | | 2016 | 105,263 | — | $14.03 | 10/11/2026 | 30,581 | — | — | — | — | | Scott A. Hudson | 2023 | — | — | — | — | — | 48,000(2) | $1,848,960 | 58,666(5) | $2,259,814 | | | 2022 | — | — | — | — | 16,017 | 32,036(3) | $1,234,027 | 48,053(6) | $1,851,002 | | | 2021 | — | — | — | — | 21,606 | 10,803(4) | $416,132 | 32,409(7) | $1,248,395 | | | 2020 | 81,585 | — | $22.98 | 2/25/2030 | 18,276 | — | — | | | | | 2019 | 53,656 | — | $26.56 | 2/26/2029 | 15,248 | — | — | — | — | | | 2018 | 227,000 | — | $19.68 | 4/9/2027 | — | — | — | — | — | | | 2017 | 41,254 | — | $18.90 | 3/31/2028 | 21,164 | — | — | — | — | | | 2016 | 105,263 | — | $14.03 | 10/11/2026 | 30,581 | — | — | — | — | | Stacey Doré | 2023 | — | — | — | — | — | 55,000(2) | $2,118,600 | 67,222(5) | $2,589,391 | | | 2022 | — | — | — | — | 13,478 | 26,958(8) | $1,038,422 | — | $— |
Outstanding Equity Awards at Fiscal Year-End—2023
| (1) The amount listed in this column represents the product of the closing market price of the Common Stock on December 29, 2023 of $38.52 multiplied by the number of shares of stock subject to the award as reflected in the previous column. |
Outstanding Equity Awards at Fiscal Year-End—2023
| (2) Includes awards granted on February 24, 2023 and vesting ratably on the first three anniversaries of February 24, 2023. |
Outstanding Equity Awards at Fiscal Year-End—2023
| (3) Includes awards granted on February 24, 2022 and vesting ratably on the first three anniversaries of February 24, 2022. For Messrs. Burke and Moldovan, also includes RSUs granted on August 1, 2022 in connection with their respective promotions to Chief Executive Officer and Chief Financial Officer, which RSUs vest ratably on the first three anniversaries of August 1, 2022. |
Outstanding Equity Awards at Fiscal Year-End—2023
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Outstanding Equity Awards at Fiscal Year-End—2023
| (4) Granted on February 22, 2021 and vests ratably on the first three anniversaries of February 22, 2021. |
Outstanding Equity Awards at Fiscal Year-End—2023
| (5) The 2023 PSUs require performance goals to be attained over a three-year period scheduled to end on December 31, 2025. The 2023 PSUs are payable in Common Stock based on the results of market, performance, and time-based criteria and vest on February 24, 2026. In the table above, the number and market value of the units that vest reflect target performance. |
Outstanding Equity Awards at Fiscal Year-End—2023
| (6) The 2022 PSUs require performance goals to be attained over a three-year period scheduled to end on December 31, 2024. The 2022 PSUs are payable in Common Stock based on the results of market, performance, and time-based criteria and vest on February 24, 2025. In the table above, the number and market value of the units that vest reflect target performance. |
Outstanding Equity Awards at Fiscal Year-End—2023
| (7) The 2021 PSUs required performance goals to be attained over a three-year period ended December 31, 2023. The 2021 PSUs were paid in Common Stock based upon the results of market, performance, and time-based criteria and vested on February 22, 2024. In the table above, the number and market value of the units that vest reflect target performance. In February 2024, the Social Responsibility & Compensation Committee certified the performance payout of the 2021 PSUs. See “2021 PSU Results” on page 57 for further details. |
Outstanding Equity Awards at Fiscal Year-End—2023
| (8) Includes RSUs granted on August 23, 2022, which RSUs vest ratably on the first three anniversaries of August 23, 2022. |
Option Exercises and Stock Vested—2023
Option Exercises and Stock Vested—2023 The following table sets forth information regarding the exercise of options and the vesting of stock awards by each Named Executive Officer during 2023.
Option Exercises and Stock Vested—2023
| | Option Awards | | Stock Awards | | | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting(1) (#) | Dividend Value Realized on Vesting ($) | Value Realized on Vesting ($) | Total Value Realized on Vesting(2) ($) | | James A. Burke | — | — | 90,198 | 111,927 | 2,071,836 | 2,183,762 | | Kristopher E. Moldovan | — | — | 24,120 | 24,488 | 610,819 | 635,307 | | Stephen J. Muscato | — | — | 68,559 | 88,620 | 1,534,289 | 1,622,909 | | Scott A. Hudson | — | — | 41,958 | 54,118 | 938,829 | 992,948 | | Stacey Doré | — | — | 13,478 | 10,493 | 408,788 | 419,280 |
Option Exercises and Stock Vested—2023
| (1) The number of shares acquired on vesting are pre-tax and do not account for shares sold or withheld to pay taxes. |
Option Exercises and Stock Vested—2023
| (2) The amounts shown include (i) value realized on vesting based on the closing stock price of Common Stock on the date of vesting, and (ii) the amount of the quarterly regular dividend that accrued with respect to such awards prior to vesting. |
Potential Payments upon Termination or Change in Control
Potential Payments upon Termination or Change in Control For the reasons discussed in the CD&A, the Company has entered into certain agreements with the Named Executive Officers, which commit the Company to make payments to the Named Executive Officers under special circumstances. Generally, these circumstances involve changes in corporate control of the Company and a qualifying termination of the Named Executive Officer’s employment. In accordance with SEC instructions, these quantitative disclosures assume that a change in control took place on December 31, 2023. In fact, no change in control of the Company occurred on that date and no Named Executive Officer’s employment terminated on that date due to a change in control. If such an event were to occur in the future, actual payments would likely be different from those presented here based on various factors, including the Common Stock price at such time. The following tables and narrative below describe payments to each of the Named Executive Officers (or, as applicable, enhancements to payments or benefits) in the event of his or her termination, including if such termination is voluntary, for cause, as a result of death, as a result of disability, without cause or for good reason or in connection with a change in control of Vistra.
Potential Payments upon Termination or Change in Control
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Compensation of Non-Employee Directors
Compensation of Non-Employee Directors The Board establishes the level of compensation for Vistra’s non-employee directors, based on the recommendation of the Social Responsibility & Compensation Committee. Directors who also are current employees of Vistra receive no additional compensation for service as directors. The Social Responsibility & Compensation Committee periodically, but no less than biannually, engages its compensation consultant to provide market-based compensation surveys to facilitate the Social Responsibility & Compensation Committee’s review of the compensation of our Board and the Committees. As part of this process, the Social Responsibility & Compensation Committee reviews the compensation provided to our non-employee directors as compared to other comparable U.S. peer companies, with the objective of ensuring that non-employee director compensation is both market-competitive in terms of annual compensation value and consistent with emerging market practices and trends. In April 2022, the Social Responsibility & Compensation Committee reviewed the compensation structure for directors with its Compensation Consultant. Based on this review, the Social Responsibility & Compensation Committee recommended, and the Board approved, an update to the director compensation structure in order to position it near the median of the market, noting that the last change to director compensation occurred in 2018. In October 2022, the Board appointed Ms. Ackermann and Mr. Barbas to the Company’s Nuclear Oversight Advisory Board. In connection with their appointments, the Social Responsibility & Compensation Committee approved an annual retainer beginning in 2023 of $10,000 for their service on the Nuclear Oversight Advisory Board, consistent with the amount of the annual retainers for other committees. In March 2024, following the acquisition of Energy Harbor, the Board converted the Nuclear Oversight Advisory Board into a standing Board committee, renamed the Nuclear Oversight Committee, and the Social Responsibility & Compensation Committee approved an annual retainer of $10,000 per committee member and $25,000 for the committee Chair.
2023 Director Compensation Table
2023 Director Compensation Table The table below sets forth information regarding the aggregate compensation earned by or paid to the non-employee members of the Board during the year ended December 31, 2023. Vistra also reimburses directors for reasonable expenses incurred in connection with their services as directors. Mr. Burke does not receive additional compensation for his services as a director of the Company.
2023 Director Compensation Table
| Name | Fees Earned or Paid in Cash ($) | RSU Awards ($)(1) | Other Compensation ($)(2) | Total ($) | | Hilary E. Ackermann | 130,000 | 160,000 | — | 290,000 | | Arcilia C. Acosta | 120,000 | 160,000 | 4,805 | 284,805 | | Gavin R. Baiera | 120,000 | 160,000 | 4,805 | 284,805 | | Paul M. Barbas | 130,000 | 160,000 | — | 290,000 | | Lisa Crutchfield | 130,000 | 160,000 | — | 290,000 | | Brian K. Ferraioli | 120,000 | 160,000 | 14,787 | 294,787 | | Scott B. Helm | 205,000 | 255,000 | 7,658 | 467,658 | | Jeff D. Hunter | 120,000 | 160,000 | — | 280,000 | | Julie Lagacy(3) | 80,000 | 160,000 | — | 240,000 | | John R. Sult | 135,000 | 160,000 | — | 295,000 |
2023 Director Compensation Table
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2023 Director Compensation Table
| (1) Reflects the grant date fair value of RSUs awarded in 2023 determined in accordance with ASC 718. These awards vest on May 3, 2024. Pursuant to the Deferred Compensation Plan, Messrs. Barbas, Ferraioli, Hunter, Sult, and Mses. Ackermann and Crutchfield, elected to defer settlement of 100% of their respective 2023 equity awards, with such RSUs, to the extent they become vested, being settled upon such Director’s separation of service as a director. For each director who defers his or her equity award, any associated dividend payments are accrued and will be distributed upon delivery of such deferred shares. As of December 31, 2023, each of the directors, other than Mr. Helm, held 6,923 unvested RSUs, and Mr. Helm held 11,034 unvested RSUs. |
2023 Director Compensation Table
| (2) Reflects cash payments with respect to accrued dividends distributed to such director upon the vesting and delivery of equity awards. |
2023 Director Compensation Table
| (3) Ms. Lagacy was appointed to the Board on February 1, 2023. |
2023 Director Compensation Table
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CEO PAY RATIO
CEO PAY RATIO We believe our executive compensation program must be internally consistent and equitable to motivate our employees to create stockholder value. We monitor the relationship between the compensation of our executive officers and the compensation of our non-managerial employees. For 2023, the total compensation of Mr. Burke, our CEO, was $10,453,376 as reported in the “Total” column of the Summary Compensation Table. The total compensation of our median employee was $149,935. The ratio of CEO pay to median worker pay for Vistra was 70:1. We calculated the ratio of the pay of our CEO to that of our median employee in a manner consistent with Item 402(u) of Regulation S-K. For purposes of determining the median employee, we identified 2023 base salary, target bonus and target long-term incentive plan equity awards obtained from internal payroll records for all employees, excluding our CEO, who were employed by us on December 31, 2023. We included and analyzed the total compensation of all employees as of December 31, 2023, whether employed on a full-time or part-time basis. We believe that the ratio of CEO pay to that of this median employee is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K. Given the different methodologies that various public companies will use to determine an estimate of their pay ratio, the estimated ratio reported above should not be used as a basis for comparison between companies.
CEO PAY RATIO
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PAY VERSUS PERFORMANCE
PAY VERSUS PERFORMANCE The following table sets forth information regarding the Company’s performance and the “Compensation Actually Paid” (“CAP”) to our Named Executive Officers, as calculated in accordance with SEC disclosure rules. CAP reflects adjusted values to unvested and vested equity awards during the years shown in the table based on year-end and other relevant valuation date stock prices, various accounting valuation assumptions, and projected performance modifiers, as well as the impact of year-to-year changes in these valuation assumptions. As a result, the total CAP amounts do not reflect actual amounts realized and paid to our NEOs in each year shown, and the Social Responsibility & Compensation Committee did not consider the information provided in the table in structuring or determining compensation for our NEOs. For a discussion of how the Social Responsibility & Compensation Committee assessed Vistra’s performance and our NEOs’ pay each year, see the section titled “Compensation Discussion and Analysis” in this Proxy Statement and in our proxy statements covering fiscal years 2020, 2021 and 2022.
PAY VERSUS PERFORMANCE
| Year (1) | Summary Compensation Table Total (2) | | Compensation Actually Paid (3) | | Average Summary Compensation Table Total for Non-PEO Named Executive Officers ($) (2) | Average Compensation Actually Paid to Non-PEO Named Executive Officers ($) (4) | Value of Initial Fixed $100 Investment Based On: (5) | | Net Income (Loss) ($000,000) | Adjusted EBITDA ($000,000) (7) | | | PEO 1 James A. Burke ($) | PEO 2 Curtis A. Morgan ($) | PEO 1 James A. Burke ($) | PEO 2 Curtis A. Morgan ($) | | | Vistra Total Shareholder Return ($) | Peer Group Total Shareholder Return ($) (6) | | | | 2023 | 10,453,377 | N/A | 30,741,208 | N/A | 4,721,253 | 11,784,665 | 189.05 | 111.59 | 1,493 | 4,101 | | 2022 | 8,559,824 | 11,852,513 | 14,390,474 | 22,523,112 | 3,372,114 | 5,415,367 | 110.73 | 120.09 | (1,227) | 2,994 | | 2021 | N/A | 10,075,626 | N/A | 4,395,128 | 3,425,261 | 1,512,908 | 105.38 | 118.24 | (1,274) | 1,908 | | 2020 | N/A | 10,875,562 | N/A | 11,977,950 | 3,459,668 | 3,548,942 | 88.13 | 100.48 | 636 | 3,685 |
PAY VERSUS PERFORMANCE
| (1) The Principal Executive Officer(s) (“PEO”) and other NEOs for the indicated years were as follows: |
PAY VERSUS PERFORMANCE
| 2023 | 2022 | 2021 | 2020 | | James A. Burke | Curtis A. Morgan (PEO through July 31, 2022) | Curtis A. Morgan (PEO) | Curtis A. Morgan (PEO) | | Kristopher E. Moldovan | James A. Burke (PEO effective August 1, 2022) | James A. Burke | James A. Burke | | Stephen J. Muscato | Kristopher E. Moldovan | Stephen J. Muscato | Stephen J. Muscato | | Scott A. Hudson | Stephen J. Muscato | Scott A. Hudson | Scott A. Hudson | | Stacey Doré | Scott A. Hudson | Stephanie Zapata Moore | Stephanie Zapata Moore | | | Stephanie Zapata Moore | | David A. Campbell |
PAY VERSUS PERFORMANCE
| (2) Amounts reported in this column represent (i) the total compensation reported in the Summary Compensation Table for the indicated year for Mr. Burke and Mr. Morgan, as applicable, and (ii) the average of the total compensation reported in the Summary Compensation Table for the indicated year for the Company’s other NEOs. |
PAY VERSUS PERFORMANCE
| (3) Amounts reported in this column reflect the total compensation reported in the Summary Compensation Table for Mr. Burke and Mr. Morgan, as applicable, in the indicated fiscal year, adjusted as set forth in the table below, as determined in accordance with SEC rules. For awards with dividend rights, these amounts are paid in cash once the underlying award vests and are incorporated as applicable in the table below. The dollar amounts reflected in this column do not reflect the actual amount of compensation earned by or paid to Mr. Burke and Mr. Morgan during the indicated year. |
PAY VERSUS PERFORMANCE
| (4) Amounts reflect the average total compensation for the Company’s NEOs, other than the PEO, for the indicated fiscal year, adjusted as set forth in the table below, as determined in accordance with SEC rules. For awards with dividend rights, these amounts are paid in cash once the underlying award vests and are incorporated as applicable in the table below. The dollar amounts reflected in this column do not reflect the actual amount of compensation earned by or paid to such NEOs during the indicated year. |
PAY VERSUS PERFORMANCE
| (5) Pursuant to rules of the SEC, the comparison assumes $100 was invested on December 31, 2019 in our common stock. Historic stock price performance is not necessarily indicative of future stock price performance. |
PAY VERSUS PERFORMANCE
| (6) The Peer Group Total Shareholder Return (“TSR”) set forth in this table utilizes the S&P 500 Utilities (Sector) Index (S&P Utilities), which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report for the year ended December 31, 2023. Such peer index was selected in accordance with SEC rules and is not necessarily indicative of the Company’s peer group due to, among other factors, the Company’s exposure to commodities. For a discussion of the Company’s selected peer group used in connection with its executive compensation program, see “Compensation Discussion and Analysis—Corporate Governance Practices—Compensation Determination Process.” |
PAY VERSUS PERFORMANCE
| (7) As noted in the Compensation Discussion and Analysis, the Social Responsibility & Compensation Committee selected Adjusted EBITDA as one of the key metrics for evaluating and rewarding management’s performance in the 2023 annual incentive compensation program (i.e., EAIP). Adjusted EBITDA is defined above under the heading “Setting of Financial and Operational Performance Targets for 2023.” Given the importance of Adjusted EBITDA as discussed further in the Compensation Discussion and Analysis (i.e., if Vistra’s Adjusted EBITDA did not meet the Adjusted EBITDA threshold performance level, the NEOs’ awards under the 2023 EAIP would have been subject to a certain “executive limiter”), the Company has determined Adjusted EBITDA to be the most important financial performance measure used to link Company performance to Compensation Actually Paid to our PEO and Non-PEO NEOs in 2023. |
PAY VERSUS PERFORMANCE
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PAY VERSUS PERFORMANCE
Reconciliation of Compensation Actually Paid Adjustments
Compensation Actually Paid Adjustments
Compensation Actually Paid Adjustments
Compensation Actually Paid Adjustments
| YEAR | Summary Compensation Table Total ($) (a) | Minus Grant Date Fair Value of Stock Option and Stock Awards Granted in Fiscal Year ($) (b) | Plus Fair Value at Fiscal Year-End of Outstanding and Unvested Stock Option and Stock Awards Granted in Fiscal Year ($) (c) | Plus/ (Minus) Change in Fair Value of Outstanding and Unvested Stock Option and Stock Awards Granted in Prior Fiscal Years ($) (d) | Plus Fair Value at Vesting of Stock Option and Stock Awards Granted in Fiscal Year that Vested During Fiscal Year ($) (e) | Plus/(Minus) Change in Fair Value as of Vesting Date of Stock Option and Stock Awards Granted in Prior Years for which Applicable Vesting Conditions Were Satisfied During Fiscal Year ($) (f) | Minus Fair Value as of Prior Fiscal Year-End of Stock Option and Stock Awards Granted in Prior Fiscal Years that Failed to Meet Applicable Vesting Conditions During Fiscal Year ($) (g) | Equals Compensation Actually Paid ($) | | PEO 1—James A. Burke | | | | | | | | | | 2023 | 10,453,377 | 5,999,985 | 13,432,774 | 11,798,881 | — | 1,056,161 | — | 30,741,208 | | 2022 | 8,559,824 | 6,061,159 | 8,935,065 | 1,904,568 | — | 1,052,176 | — | 14,390,474 | | PEO 2—Curtis A. Morgan | | | | | | | | | | 2022 | 11,852,513 | 8,646,893 | 12,426,526 | 4,247,139 | — | 2,643,827 | — | 22,523,112 | | 2021 | 10,075,626 | 7,299,997 | 3,627,694 | (1,640,167) | — | (368,029) | — | 4,395,128 | | 2020 | 10,875,562 | 6,299,983 | 5,866,165 | (1,746,917) | — | 3,283,123 | — | 11,977,950 | | Average Other NEOs (h) | | | | | | | | | | 2023 | 4,721,253 | 2,862,489 | 6,282,874 | 3,234,488 | — | 408,539 | — | 11,784,665 | | 2022 | 3,372,114 | 2,225,203 | 3,057,987 | 790,220 | — | 420,248 | — | 5,415,367 | | 2021 | 3,425,261 | 2,271,217 | 1,128,669 | (677,755) | — | (92,050) | — | 1,512,908 | | 2020 | 3,459,668 | 1,899,979 | 1,769,147 | (305,995) | — | 526,101 | — | 3,548,942 |
Compensation Actually Paid Adjustments
| (a) Represents Total Compensation as reported in the Summary Compensation Table for the indicated fiscal year. With respect to the Average Other NEOs, amounts shown represent averages. |
Compensation Actually Paid Adjustments
| (b) Amounts reported with respect to PSUs granted to the Named Executive Officers reflect the fair value of the award at the service inception date based on target performance. Amounts reported with respect to all other equity awards reflect the grant date fair value of the stock option and stock awards granted during the indicated fiscal year, computed in accordance with the methodology used for financial reporting purposes. |
Compensation Actually Paid Adjustments
| (c) Represents the fair value as of the indicated fiscal year-end of the outstanding and unvested stock option and stock awards granted during such fiscal year, computed in accordance with the methodology used for financial reporting purposes. Accordingly, for awards subject to performance-based vesting conditions, they are based on the probable outcome of such performance-based vesting conditions as of the last day of the fiscal year. |
Compensation Actually Paid Adjustments
| (d) Represents the change in fair value during the indicated fiscal year of the outstanding and unvested stock option and stock awards held by the applicable NEO as of the last day of the indicated fiscal year, computed in accordance with the methodology used for financial reporting purposes and, for awards subject to performance-based vesting conditions, based on the probable outcome of such performance-based vesting conditions as of the last day of the fiscal year. |
Compensation Actually Paid Adjustments
| (e) Represents the fair value at vesting of the stock option and stock awards that were granted and vested during the indicated fiscal year, computed in accordance with the methodology used for financial reporting purposes. |
Compensation Actually Paid Adjustments
| (f) Represents the change in fair value, measured from the prior fiscal year-end to the vesting date, of each stock option and stock award that was granted in a prior fiscal year and which vested during the indicated fiscal year, computed in accordance with the methodology used for financial reporting purposes. |
Compensation Actually Paid Adjustments
| (g) Represents the fair value as of the last day of the prior fiscal year of the stock option and stock awards that were granted in a prior fiscal year and which failed to meet the applicable vesting conditions in the indicated fiscal year, computed in accordance with the methodology used for financial reporting purposes. |
Compensation Actually Paid Adjustments
| (h) See footnote 1 above for the NEOs included in the average for each year. |
Compensation Actually Paid Adjustments
| | 2024 Proxy Statement | 77 |