8-KMaterial AgreementsExhibits & Filings

WASTE MANAGEMENT INC 8-K Report, Material Agreement (Mar 28, 2006)

Filed March 28, 2006For Securities:WM

Summary

This 8-K filing from Waste Management, Inc. (WM) primarily details the entry into a material definitive agreement concerning an employment contract for James Schultz, Senior Vice President – Employee and Customer Engagement. The agreement, effective October 30, 2005, establishes a two-year term with automatic one-year renewals, outlining a base salary, bonus structure, and specific perquisites for Mr. Schultz. Importantly, the filing also specifies severance packages in cases of termination without cause, termination for good reason in connection with a change in control, and termination due to death or disability. These provisions offer a degree of financial security to a key executive and outline the company's obligations in various termination scenarios, which can be relevant for understanding executive compensation and potential future liabilities.

Key Highlights

  • 1Waste Management, Inc. entered into a material definitive agreement for the employment of Senior Vice President James Schultz.
  • 2The employment agreement is effective from October 30, 2005, with an initial term of two years and automatic one-year renewals.
  • 3Mr. Schultz will receive a minimum base salary of $315,416 per year.
  • 4A target annual bonus of 60% of base salary is stipulated, with a potential range of 0% to 120% based on performance.
  • 5The agreement includes provisions for severance payments in case of termination without cause, with benefits potentially equaling up to two times base salary and target bonus.
  • 6Enhanced severance is provided for termination without cause or good reason related to a change in control, including three times base salary and target bonus, and extended benefit continuation.
  • 7Restrictive covenants, including non-compete and non-solicitation clauses for two years post-termination, are part of the agreement.

Frequently Asked Questions

The primary purpose of this 8-K filing is to disclose the execution of a material definitive agreement, specifically an employment agreement between Waste Management, Inc. and its Senior Vice President, James Schultz.

Mr. Schultz is guaranteed a minimum base salary of $315,416 annually. He is also eligible for an annual bonus with a target of 60% of his base salary, which can range from 0% to 120% depending on performance goals.

If terminated without cause, Mr. Schultz is entitled to cash payments generally equal to two times his base salary and target bonus, plus continuation of health and welfare benefits for up to two years. If termination without cause or for good reason occurs in connection with a change in control, these benefits increase to three times base salary and target bonus, with three years of benefit continuation.

Yes, the agreement includes restrictive covenants that prevent Mr. Schultz from competing with or soliciting Company customers or employees for a period of two years following the termination of his employment. He is also restricted from disparaging the Company.