Summary
This Form 8-K filing by Waste Management, Inc. (WM) on March 11, 2010, details the compensatory arrangements for its named executive officers. Effective March 9, 2010, the Management Development and Compensation Committee granted equity awards under the 2009 Stock Incentive Plan, consisting of performance share units (PSUs) and stock options. The PSUs are tied to achieving return on invested capital by December 31, 2012, with payouts ranging from 0% to 200% of the target amount. The stock options have a 10-year term, with an exercise price equal to the fair market value on the grant date, and vest over three years. These awards aim to align executive compensation with company performance and shareholder value creation.
Key Highlights
- 1Waste Management, Inc. (WM) granted equity awards to its named executive officers on March 9, 2010.
- 2Awards include performance share units (PSUs) and stock options under the 2009 Stock Incentive Plan.
- 3PSUs are performance-based, with payout contingent on achieving return on invested capital by December 31, 2012.
- 4The range for PSU payouts is 0% to 200% of the targeted amount.
- 5Stock options have a 10-year term and a vesting schedule of 25% annually over three years.
- 6The exercise price for stock options is the fair market value on the grant date.
- 7Detailed terms for PSU and stock option awards, including provisions for termination and change in control, are outlined.
Frequently Asked Questions
The named executive officers received performance share units (PSUs) and stock options.
The PSUs are performance-based on 'return on invested capital.' The payout can range from 0% to 200% of the targeted amount, based on actual results achieved by December 31, 2012.
The stock options vest over three years, with 25% vesting on the first anniversary, another 25% on the second, and the remaining 50% on the third anniversary. The exercise price is the fair market value of the company's common stock on the date of the grant.
The treatment of PSUs and stock options upon termination varies depending on the reason for termination (e.g., death, disability, retirement, involuntary termination for cause or not for cause). Generally, unvested PSUs are forfeited upon voluntary termination, while vested options have limited exercise periods. Specific provisions also exist for change in control scenarios.