SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On February 23, 2021, the Management Development and Compensation Committee (the “Committee”) of the Board of Directors of Waste Management, Inc. (the “Company”) granted equity awards under the Company’s 2014 Stock Incentive Plan to each of the Company’s named executive officers, as identified in the Company’s most recent proxy statement (collectively, the “Executives”).
Each of the Executives, which includes James C. Fish, Jr., President and Chief Executive Officer; John J. Morris, Jr., Executive Vice President and Chief Operating Officer; Devina A. Rankin, Executive Vice President and Chief Financial Officer; Tara J. Hemmer, Senior Vice President, Operations and Mr. Steven R. Batchelor, Senior Vice President, Operations, received performance share units and stock options. The number of performance share units granted to each of the Executives is as follows: Mr. Fish — 59,650; Mr. Morris — 16,140; Ms. Rankin — 14,736; Ms. Hemmer – 11,930 and Mr. Batchelor – 11,930. The material terms of the performance share units are described below.
|Performance Share Units|
|Performance Calculation Date (“PCD”)||As of December 31, 2023; award (if any) paid out after certification by the Committee of actual level of achievement (“payment date”).|
|Performance Measure||50% of the PSUs will have a cash flow generation performance measure, and 50% of the PSUs will have a total shareholder return relative to the S&P 500 performance measure, in each case as set forth in the award agreement filed as an exhibit hereto.|
|Range of Possible Awards||0 — 200% of targeted amount, plus accrued dividend equivalents, based on actual results achieved.|
Termination of Employment
Death or Disability before PCD
Payable in full on payment date based on actual results as if participant had remained an active employee through PCD.
Involuntary Termination for Cause or
Voluntary Resignation before PCD
Involuntary Termination other than
for Cause before PCD
Retirement (as defined in the award
agreement) before PCD
Payable on payment date based on actual results, prorated based on portion of performance period completed prior to termination of employment.
If Retirement occurs on or after December 31, 2021, payable in full on payment date based on actual results as if participant had remained an active employee through PCD. If Retirement occurs before December 31, 2021, payable on payment date based on actual results, prorated based on the number of days worked during 2021 (the first year of the performance period) divided by 365.
|Change in Control before PCD||
Performance measured prior to the change in control and paid on prorated basis on actual results achieved up to such date. Thereafter, participant also generally receives a replacement award of restricted stock units in the successor entity generally equal to the number of PSUs that would have been earned had no change in control occurred and target performance levels had been met from the time of the change of control through December 31, 2023, adjusted for any conversion factors in the change in control transaction. The new restricted stock units in the successor entity would vest on December 31, 2023.
The Committee also granted stock options to the Executives to purchase the following number of shares of the Company’s common stock: Mr. Fish — 98,551; Mr. Morris — 26,667; Ms. Rankin — 24,348; Ms. Hemmer – 19,710 and Mr. Batchelor – 19,710. The material terms of the stock options are described below.
|Vesting Schedule||34% on first anniversary; |
33% on second anniversary; and
33% on third anniversary.
|Term||10 years from date of grant.|
|Exercise Price||Fair Market Value on date of grant - $110.81.|
|Termination of Employment|
|Death or Disability||All options immediately vest and remain exercisable for one year, but in no event later than the original term.|
|Qualifying Retirement||Continued vesting and exercisability for three years, but in no event later than the original term.|
|Involuntary Termination other than for Cause or Voluntary Resignation||All vested options remain exercisable for 90 days, but in no event later than the original term.|
|Involuntary Termination for Cause||
All options are forfeited, whether or not exercisable.
Involuntary Termination or Resignation for Good Reason following a Change in Control
All options immediately vest and remain exercisable for three years, but in no event later than the original term.
The form of award agreement for the equity awards granted to the Executives is filed as Exhibit 10.1 to this report. The descriptions of the material terms of the awards are qualified in their entirety by reference to the award agreement, incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
|10.1||Form of 2021 Long Term Incentive Compensation Award Agreement for Senior Leadership Team|
|104||Cover Page Interactive Data File (embedded within the Inline XBRL document)|
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
|WASTE MANAGEMENT, INC.|
|Date: March 1, 2021||By:||/s/ Charles C. Boettcher|
|Charles C. Boettcher|
|Executive Vice President, Corporate Development|
|and Chief Legal Officer|