SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 1, 2022
Waste Management, Inc.
(Exact Name of Registrant as Specified in Charter)
| Delaware | | 1-12154 | | 73-1309529 |
(State or Other Jurisdiction
of Incorporation) | | (Commission File Number) | | (IRS Employer
Identification No.) |
| 800 Capitol Street, Suite 3000, Houston, Texas | | 77002 |
| (Address of Principal Executive Offices) | | (Zip Code) |
Registrant’s Telephone number, including area code: (713) 512-6200
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | | Trading Symbol(s) | | Name of each exchange on which registered |
| Common Stock, $0.01 par value | | WM | | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On March 1, 2022, 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 and Chief Sustainability Officer and Mr. Steven R. Batchelor, Senior Vice President, Operations, received performance share units (“PSUs”) and stock options. The number of PSUs granted to each of the Executives is as follows: Mr. Fish — 47,620; Mr. Morris — 14,150; Ms. Rankin — 11,972; Ms. Hemmer – 9,252 and Mr. Batchelor – 9,252. The material terms of the PSUs are described below.
| PSUs | | |
| | | |
| Performance Calculation Date (“PCD”) | | As of December 31, 2024; 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 Exhibit 10.1 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 | | Immediate forfeiture. |
| | | |
Involuntary Termination other than for Cause before PCD | | Payable on payment date based on actual results, prorated based on portion of performance period completed prior to termination of employment. |
| | | |
| Retirement (as defined in the award agreement) before PCD | | If Retirement occurs on or after December 31, 2022, 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, 2022, payable on payment date based on actual results, prorated based on the number of days worked during 2022 (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, 2024, 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, 2024. |
The Committee granted stock options to the Executives to purchase the following number of shares of the Company’s common stock: Mr. Fish — 66,188; Mr. Morris — 19,667; Ms. Rankin — 16,641; Ms. Hemmer – 12,859 and Mr. Batchelor – 12,859. The material terms of the stock options are described below.
| Stock Options | | |
| | | |
| 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 - $145.67. |
| | | |
| 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. |
Additionally, on March 1, 2022, the Committee granted an award of restricted stock units (“RSUs”) to each of Mr. Morris, Ms. Rankin, Ms. Hemmer and Mr. Batchelor in special recognition of leadership and contributions critical to the Company’s acquisition of Advanced Disposal Services, Inc. and the subsequent integration and synergy generation. The number of RSUs granted to each of the Executives is as follows: Mr. Morris — 10,204; Ms. Rankin — 6,803; Ms. Hemmer – 5,102 and Mr. Batchelor – 5,102. The material terms of the RSUs are described below.
RSUs | | |
| | | |
| Vesting Schedule | | RSUs vest in full on the third anniversary of the date of grant. Each RSU will convert into one share of Company common stock. |
| | |
| Dividend Equivalents | | Dividends will accrue and be paid in cash upon settlement. |
| | | |
| Termination of Employment | | |
| | | |
| Death or Disability | | All RSUs immediately vest. |
| | | |
| Retirement (as defined in the award agreement) | | If Retirement occurs after the first anniversary of the date of grant, RSUs generally continue to vest as if the employee had remained employed until the end of the vesting period and will be paid out on the originally scheduled vesting date. If Retirement occurs before the first anniversary of the date of grant, RSUs payable on the originally scheduled vesting date will be prorated based on the number of days worked during the calendar year following the date of grant (the first year of the vesting period) divided by 365. |
| | | |
Involuntary Termination without Cause | | Payable on originally scheduled vesting date, prorated based on the portion of the vesting period completed prior to termination of employment. |
| | | |
| Resignation; Involuntary Termination for Cause | | All unvested RSUs are forfeited. |
| | | |
| Involuntary Termination without Cause following a Change in Control | | All RSUs immediately vest and will be paid on the originally scheduled vesting date. |
The form of award agreement for the PSUs and stock options granted to the Executives is filed as Exhibit 10.1 to this report. The form of award agreement for the RSUs granted to the Executives is filed as Exhibit 10.2 to this report. The descriptions of the material terms of the awards are qualified in their entirety by reference to the appropriate award agreement, incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit Index
SIGNATURES
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 7, 2022 | By: | /s/ Charles C. Boettcher |
| | | Charles C. Boettcher |
| | | Executive Vice President, Corporate Development and Chief Legal Officer |
