Securities Exchange Act of 1934
(Amendment No. )
The Statement; (iii) for every “ONE YEAR” with respect to how frequently a non-binding advisory stockholder vote to approve the compensation of our NEOs should occur; and (iv) “FOR” the ratification of the appointment of KPMG as our independent registered public accounting firm.20182022 ANNUAL MEETING OF STOCKHOLDERSTo Be Held on Thursday, May 17, 201820182022 Annual Meeting of Stockholders (the "Annual Meeting"“Annual Meeting”) of Summit Materials, Inc. ("(“Summit Materials"Materials” or the "Company"“Company”) will be held at 8:00 a.m., EasternCentral Time, on Thursday,Wednesday, May 17, 2018,18, 2022, at The Post Oak Hotel at Uptown Houston, 1600 West Loop South, Houston, TX 77027. In addition, stockholders will have the offices ofopportunity to attend the Company's subsidiary, Hinkle Contracting Company, LLC, locatedAnnual Meeting through a virtual web conference at 101 Helm St., Suite 110, Lexington, Kentucky 40505www.virtualshareholdermeeting.com/SUM2022. The Annual Meeting is being held for the following purposes: 1. To elect the two nominees for director named in the attached Proxy Statement to serve until the 2021 Annual Meeting of Stockholders and until their respective successors are elected and qualified; 2. To ratify the appointment of KPMG LLP ("KPMG") as our independent registered public accounting firm for our fiscal year ending December 29, 2018; 3. To approve, on a nonbinding advisory basis, the compensation of our named executive officers ("NEOs"), as disclosed in the Proxy Statement; and 4. To transact such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof. Our 1 To elect the four nominees for director, named in the attached Proxy Statement (the “Proxy Statement”) to serve until the 2023 Annual Meeting of Stockholders and until their respective successors are elected and qualified; 2 To approve, on a nonbinding advisory basis, the compensation of our named executive officers (“NEOs”), as disclosed in the Proxy Statement; 3 To indicate, on a nonbinding advisory basis, whether a nonbinding advisory stockholder vote to approve the compensation of our NEOs should occur every one, two, or three years; 4 To ratify the appointment of KPMG LLP (“KPMG”) as our independent registered public accounting firm for our fiscal year ending December 31, 2022; and 5 To transact such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof. of Directors recommends you vote (i) "FOR"“FOR” the election of each of the nominees to the Board; (ii) "FOR" the ratification of the appointment of KPMG as our independent registered public accounting firm; and (iii) "FOR"“FOR” the approval, on a nonbinding advisory basis, of the compensation of our NEOs, as disclosed in the Proxy Statement. of Directors has fixed March 19, 201823, 2022 as the record date for determining stockholders entitled to receive notice of, and to vote at, the Annual Meeting or any adjournment or postponement thereof. Only stockholders of record at the close of business on that date will be entitled to notice of, and to vote at, the Annual Meeting.By Order of the Board of Directors
Anne Lee BenedictExecutive Vice President, Chief Legal Officer and SecretaryDenver, ColoradoMarch 30, 2018PROXY SUMMARYThe following description is a summary that highlights certain information in the Proxy Statement. You should read the entire2022 Annual Meeting of Stockholders, Proxy Statement carefully before voting. Your vote is important. Whetherand form of proxy are being distributed and made available on or not you plan to attend the Annual Meeting,about April 1, 2022. As always, we encourage you to vote your shares promptly.ANNUAL MEETINGDATE: May 17, 2018TIME: 8:00 a.m., Eastern TimeLOCATION: The officesBy Order of the Company's subsidiary, Hinkle Contracting Company, LLC, located at 101 Helm St., Suite 110, Lexington, Kentucky 40505Board of Directors![[MISSING IMAGE: sg_chrisgaskil-bw.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/sg_chrisgaskil-bw.jpg){kind=small}
April 1, 2022
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- workforce identifies as non-white
For a more detailed discussion on our financial performance, see our combined Annual Report to Stockholders and Annual Report on Form 10-K for the year ended December 30, 2017 (the "2017 Annual Report"), available atwww.proxyvote.com.
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You will find important information about the qualifications of each of our director nominees beginning on page 9.Our Board of Directors ("Board") recommendsis female and 60% of our executive officers are female, including our Chief Executive Officer
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We are seeking ratification ofNorth Star Pillars. Target setting was completed hand-in-hand with the appointment of KPMG to serve as our independent registered public accounting firm for 2018 as set forth in Item 2 on page 19.Our Board recommends that you vote "FOR" the ratification.
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Our stockholders have the opportunity to cast a nonbinding advisory vote on the compensationdevelopment of our NEOs, as set forthElevate strategy. We embedded ESG targets in Item 3 on page 25. Last year, stockholders representing approximately 96%the planning process to ensure business decisions are made with sustainability considerations in mind. Further details for each target are found within our 2021 ESG Report.
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Chairman of the Board of Directors
Summit Materials, Inc.
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ANNEX | | | | | 59 | | |
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| | ITEM 1 ELECTION OF DIRECTORS | |
| | The board of directors (the “Board”) of Summit Materials, Inc. (“Summit Materials” or the “Company”) currently has nine seats, divided into three classes: Class I, Class II and Class III. • Our Class I directors are Joseph S. Cantie, Anne M. Cooney, Anne P. Noonan and Tamla Oates-Forney and their terms will expire at this Annual Meeting. • Our Class II directors are John R. Murphy and Steven H. Wunning, and their terms will expire at the 2023 Annual Meeting. • Our Class III directors are Howard L. Lance, Anne K. Wade and Susan A. Ellerbusch, and their terms will expire at the 2024 Annual Meeting. At the Company’s 2021 Annual Meeting, the Company’s stockholders approved and adopted an amendment to the Company’s amended and restated Certificate of Incorporation (the “Charter”) to remove the three separate classes of directors of the Board and replace with one class of directors (the “Declassification Amendment”). As a result, (i) the current Class I directors will be elected at this Annual Meeting to serve for a term of one year, (ii) the current Class I and II directors will be elected at the 2023 Annual Meeting to serve for a term of one year, and (iii) the current Class I, II and III directors will be elected at the 2024 Annual Meeting to serve for a term of one year, at which time all directors will be elected to serve for one year terms at all subsequent Annual Meetings. Accordingly, the Board proposes that Mr. Cantie and Mss. Cooney, Noonan and Oates-Forney be reelected to Class I for a one-year term expiring at the 2023 Annual Meeting. Each nominee for director will, if elected, continue in office until the 2023 Annual Meeting and until the director’s successor has been duly elected and qualified, or until the earlier of the director’s death, resignation or removal. The proxy holders named on the proxy card intend to vote the proxy (if you are a stockholder of record) for the election of each of these nominees, unless you indicate on the proxy card that your vote should be withheld for any of the nominees. Under Securities and Exchange Commission (“SEC”) rules, proxies cannot be voted for a greater number of persons than the number of nominees named. Each nominee has consented to be named as a nominee in this Proxy Statement and to serve if elected. If any nominee is not able to serve, proxies will be voted in favor of the other nominees and may be voted for a substitute nominee, unless the Board chooses to reduce the number of directors serving on the Board. | |
| | THE BOARD RECOMMENDS A VOTE “FOR” EACH NOMINEE | |
PROXY STATEMENT
ANNUAL MEETING
To Be Held on Thursday, May 17, 2018
The enclosed proxy is solicited by the Board of Directors (the "Board") of Summit Materials, Inc. ("Summit Materials" or the "Company") for use at the Annual Meeting of Stockholders (the "Annual Meeting") to be held at 8:00 a.m., Eastern Time, on Thursday, May 17, 2018, at the offices of the Company's subsidiary, Hinkle Contracting Company, LLC, located at 101 Helm St., Suite 110, Lexington, Kentucky 40505, and at any adjournment or postponement thereof. Our principal executive offices are located at 1550 Wynkoop Street, 3rd Floor, Denver, Colorado 80202. This Proxy Statement is first being made available to our stockholders on or about March 30, 2018.
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Only holders of record of our Class A Common Stock and Class B Common Stock (each such designation having par value $0.01 per share) at
Each share of Class A Common Stock is entitled to one vote for each director nominee and one vote for each other item to be voted on at the Annual Meeting. All of the shares of our outstanding Class B Common Stock are currently held by our pre-initial public offering ("IPO") investors, including certain members of management or their family trusts that directly hold limited partnership interests (the "LP Units"). A holderyour Board, take seriously our jobs of Class B Common Stock is entitled, without regard to the number of shares of Class B Common Stock held by such holder, to a number of votes that is equal to the aggregate number of LP Units held by such holder. As of the record date, the total number of LP Units to which the voting power of the Class B Common Stock relates was 3,332,266.
A majority of the voting power of Class A Common Stock and Class B Common Stock entitled to vote, present in person or represented by proxy, constitutes a quorum for the transaction of business at the Annual Meeting. Abstentions and broker non-votes will be included in determining the presence of a quorum at the Annual Meeting.
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We are furnishing proxy materials to some of our stockholders via the Internet by mailing a Notice of Internet Availability of Proxy Materials, instead of mailing printed copies of those materials. The Notice of Internet Availability of Proxy Materials directs stockholders to a website where they can access our proxy materials, including this Proxy Statement and our Annual Report on Form 10-K for the year ended
December 30, 2017 (the "2017 Annual Report"), and view instructions on how to vote via the Internet or by telephone. If you received a Notice of Internet Availability of Proxy Materials and would prefer to receive a paper copy of our proxy materials, please follow the instructions included in the Notice of Internet Availability of Proxy Materials. If you elect to receive our future proxy materials electronically, you will receive access to those materials via e-mail unless and until you elect otherwise.
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Shares that are properly voted via the Internet or by telephone or for which proxy cards are properly executed and returned will be voted at the Annual Meeting in accordance with the directions given or, in the absence of directions, will be voted in accordance with the Board's recommendations as follows: "FOR" the election of each of the nominees to the Board named herein; "FOR" the ratification of the appointment of our independent registered public accounting firm; and "FOR" the approval, on a nonbinding advisory basis, of the compensation of our named executive officers ("NEOs") as disclosed in this Proxy Statement. It is not expected that any additional matters will be brought before the Annual Meeting, but if other matters are properly presented, the persons named as proxies in the proxy card or their substitutes will vote in their discretion on such matters.
The manner in which your shares may be voted depends on how your shares are held. If you own shares of record, meaning that your shares are represented by certificates or book entries in your name so that you appear as a stockholder on the records of Broadridge Financial Solutions, Inc. ("Broadridge"), our stock transfer agent, you may vote by proxy, meaning you authorize individuals named in the proxy card to vote your shares. You may provide this authorization by voting via the Internet, by telephone or (if you have received paper copies of our proxy materials) by returning a proxy card. In these circumstances, if you do not vote by proxy or in person at the Annual Meeting, your shares will not be voted. If you own shares in street name, meaning that your shares are held by a bank, brokerage firm, or other nominee, you may instruct that institution on how to vote your shares. You may provide these instructions by voting via the Internet, by telephone, or (if you have received paper copies of proxy materials through your bank, brokerage firm, or other nominee) by returning a voting instruction form received from that institution.
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With respect to the election of directors (Item 1), a nominee for director shall be elected to the Board by a plurality of the votes cast in respect of the shares of common stock present in person or represented by proxy at the Annual Meeting and entitled to vote on the election of directors. A plurality vote requirement means that the director nominees with the greatest number of votes cast "FOR," even if less than a majority, will be elected. You may vote "FOR" or "WITHHOLD" with respect to each nominee. A withhold vote in the election of directors will have the same effect as an abstention. Neither a withhold vote nor a broker non-vote will affect the outcome of the election of directors. Broker non-votes occur when a person holding shares in street name, such as through a brokerage firm, does not provide instructions as to how to vote those shares and the broker lacks the authority to vote uninstructed shares at its discretion. Under current New York Stock Exchange ("NYSE") interpretations that govern broker non-votes, Items 1 and 3 are considered non-discretionary matters, and a broker will lack the authority to vote uninstructed shares at its discretion on such proposals. Item 2 is considered a discretionary matter, and a broker will be permitted to exercise its discretion to vote uninstructed shares on the proposal. This means that, if you do not provide voting instructions on Item 2, your broker may nevertheless vote your shares on your behalf with respect to the ratification of the appointment of KPMG as our independent registered public accounting firm for the fiscal year ending December 29, 2018, but cannot vote your sharesand on any other matters being considered at the Annual Meeting.
For all matters proposed for a vote at the Annual Meeting other than the election of directors (Item 1), the affirmative vote of a majority of the voting power of common stock present in person or represented by proxy and entitled to vote on the matter is required to approve the matter. With respect to the ratification of the appointment of KPMG as our independent registered public accounting firm for the fiscal year ending December 29, 2018 (Item 2) and the nonbinding advisory vote on the compensationbehalf of our NEOs (Item 3), you may vote "FOR," "AGAINST," or "ABSTAIN." For these matters, abstentions are not counted as affirmative votes on a matter but are counted as present at the Annual Meeting and entitled to vote and will have the effect of a vote "against" the matter, and broker non-votes, if any, will have no effect on the outcome of these matters.
Voting via the Internet or by telephone helps save money by reducing postage and proxy tabulation costs.
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VOTE BY MAIL. If you have received paper copies of our proxy materials, you have the option to vote by mail by marking, dating and signing your proxy card or voting instruction form and returning it in the postage-paid envelope.
We encourage you to register to receive all future stockholder communications electronically, instead of in print. This means that, after you register, access to the annual report, proxy statement,employees, customers, suppliers and other correspondence will be deliveredstakeholders, all of whom uniquely matter to you via e-mail.us.
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If you own common stock of record, you may attend the Annual Meeting and vote in person, regardless of whether you have previously voted by proxy card, via the Internet or by telephone. If you own common stock in street name, you may attend the Annual Meeting, but in order to vote your shares at the Annual Meeting you must obtain a "legal proxy" from the bank, brokerage firm, or other nominee that holds your shares. You should contact your bank or brokerage account representative to learn how to obtain a legal proxy. We encourage you to vote your shares in advance of the Annual Meeting by one of the methods described above, even if you plan on attending the Annual Meeting. If you have already voted prior to the Annual Meeting, you may nevertheless change or revoke your vote at the Annual Meeting as described below. Only stockholders as of the record date (March 19, 2018) are entitled to attend the Annual Meeting in person. If you own common stock of record, your name will be on a list and you will be able to gain entry with a government-issued photo identification, such as a driver's license, state-issued identification card, or passport. If you own common stock in street name, in order to gain entry you must present a government-issued photo identification and proof of beneficial stock ownership as of the record date, such as your Notice of Internet Availability of Proxy Materials, a copy of your proxy card or voting instruction form if you received one, or an account or brokerage statement or other similar evidence showing stock ownership as of the record date. If you are a representative of an entity that owns common stock of the Company, you must present a government-issued photo identification, evidence that you are the entity's authorized representative or proxyholder and, if the entity is a street name owner, proof of the entity's beneficial stock ownership as of the record date.
If you are not a stockholder, you will be entitled to admission only if you have a valid legal proxy from a record holder and a government-issued photo identification. Each stockholder may appoint only one proxyholder or representative to attend on his or her behalf.
You can find directions to the Annual Meeting atinvestors.summit-materials.com/FinancialDocs. Cameras, recording devices and other electronic devices are prohibited at the Annual Meeting.
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If you own common stock of record, you may revoke your proxy or change your voting instructions at any time before your shares are voted at the Annual Meeting by delivering to the Secretary of the Company a written notice of revocation or a duly executed proxy (via the Internet or telephone or by returning a proxy card) bearing a later date or by attending the Annual Meeting and voting in person. A stockholder owning common stock in street name may revoke or change voting instructions by contacting the bank, brokerage firm or other nominee holding the shares or by obtaining a legal proxy from such institution and voting in person at the Annual Meeting.
Important Notice Regarding the Availability of Proxy Materials for the Summit Materials, Inc.Annual Meeting of Stockholders to be Held on Thursday, May 17, 2018
This Notice, our Proxy Statement, and our combined Annual Report and Annual Report onForm 10-K for the year ended December 30, 2017 are available at www.proxyvote.com
Our Board currently has eight seats, divided into three classes: Class I, Class II and Class III. Each class consists, as nearly as possible, of one-third of the total number of directors.
•Our Class I directors are Thomas W. Hill, Joseph S. Cantie and Neil P. Simpkins, and their terms will expire at the 2019 Annual Meeting.•Our Class II directors are Ted A. Gardner, John R. Murphy and Steven H. Wunning, and their terms will expire at the 2020 Annual Meeting.•Our Class III directors are Howard L. Lance and Anne K. Wade, and their terms will expire at this Annual Meeting.
The Board proposes that Mr. Lance and Ms. Wade be reelected to Class III for new terms of three years each. Each nominee for director will, if elected, continue in office until the 2021 Annual Meeting and until the director's successor has been duly elected and qualified, or until the earlier of the director's death, resignation or removal. The proxy holders named on the proxy card intend to vote the proxy (if you are a stockholder of record) for the election of each of these nominees, unless you indicate on the proxy card that your vote should be withheld for any of the nominees. Under Securities and Exchange Commission ("SEC") rules, proxies cannot be voted for a greater number of persons than the number of nominees named.
Each nominee has consented to be named as a nominee in this Proxy Statement and to serve if elected. If any nominee is not able to serve, proxies will be voted in favor of the other nominees and may be voted for a substitute nominee, unless the Board chooses to reduce the number of directors serving on the Board.
THE BOARD RECOMMENDS A VOTE "FOR" EACH NOMINEE.
Biographical and Related Information of Director Nominees and Continuing Directors
The principal occupations and certain other information about our director nominees and our continuing directors (including the skills and qualifications that led to the conclusion that they should serve as directors) are set forth below. The age shown below for each director is as of May 17, 2018, which is the date of the Annual Meeting.
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The Board has nominated twofour directors to be elected at the Annual Meeting to each serve for three-yearone-year terms ending with the 20212023 Annual Meeting of Stockholders and until a successor is duly elected and qualified, or until the earlier of the director'sdirector’s death, resignation or removal. Each nominee is currently a director of the Company and has agreed to serve if elected.
The age shown below for each director is as of May 18, 2022, which is the date of the Annual Meeting.
| | ![[MISSING IMAGE: ph_joesephcantie-4c.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_joesephcantie-4c.jpg) Joseph S. Cantie Age: 58 Director since 2016 BOARD COMMITTEES • Audit OTHER BOARDS • TopBuild Corp • Howmet Aerospace Inc. | | | Joseph S. Cantie is the former Executive Vice President and Chief Financial Officer of ZF TRW, a division of ZF Friedrichshafen AG, a global automotive supplier, a position he held from May 2015 until January 2016. Career Highlights • Executive Vice President and Chief Financial Officer, TRW Automotive Holdings Corp., which was acquired by ZF Industries in May 2015 (2003-2015) • Various executive positions at TRW Automotive Holdings Corp. (1999-2003) • Various executive positions, including Vice President and Controller of LucasVarity Plc (1996-1999) Skills / Experience • Financial and operating experience • Extensive knowledge of the industrial sector Education • BS, State University of New York at Buffalo Also… Mr. Cantie spent 10 years at KPMG and is a certified publicaccountant. | |
| | ![[MISSING IMAGE: ph_annecooney-4c.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_annecooney-4c.jpg) Anne M. Cooney Age: 62 Director since 2018 BOARD COMMITTEES • Human Capital and Compensation • Governance and Sustainability (Chair) OTHER BOARDS • The Manitowoc Company, Inc. • WESCO International, Inc. | | | Anne M. Cooney is the former President of the Process Industries and Drives Division of Siemens Industry, Inc., a division of Siemens AG, a multinational conglomerate primarily engaged in industrial engineering, electronics, energy, healthcare and infrastructure activities, a position she held from October 2014 until her retirement in December 2018. Career Highlights • President, Process Industries and Drives Division of Siemens Industry, Inc. (2014-2018) • Chief Operating Officer, Siemens Healthcare’s Diagnostics division (2011-2014) • President, Drives Technologies Division, Siemens Industry, Inc. (2009-2011) Skills / Experience • Leadership experience • Management and operational experience Education • BS in Industrial Management, Gannon University • MBA, Emory University | |
| | ![[MISSING IMAGE: ph_noonananne-4clr.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_noonananne-4clr.jpg) Anne P. Noonan Age: 58 Director since 2020 BOARD COMMITTEES • N/A OTHER BOARDS • CF Industries Holdings, Inc. | | | Anne P. Noonan was named the President and Chief Executive Officer of Summit Materials on September 1, 2020. Prior to joining Summit Materials, Ms. Noonan served as president and chief executive officer and as a director of OMNOVA Solutions Inc. (“OMNOVA”), a global provider of emulsion polymers, specialty chemicals, and engineered surfaces for a variety of commercial, industrial, and residential end uses, with manufacturing, technical, and other facilities located in North America, Europe, China, and Thailand, from December 2016 until April 1, 2020 when OMNOVA was acquired by Synthomer plc. Career Highlights • President and Chief Executive Officer, Summit Materials (September 2020-present) • President and Chief Executive Officer, OMNOVA (November 2016 -April 2020) • President, Performance Chemicals, OMNOVA (2014-November 2016) Skills / Experience • Public company governance experience • Operational expertise • Environmental and safety expertise • Extensive experience in risk management and accounting and finance • Corporate strategy, strategic initiative, and mergers & acquisitions expertise • Innovation and marketing • Advocacy and regulatory affairs Education • BS in Chemistry, University College Dublin, Ireland • MS in Organometallic Chemistry, University College Dublin, Ireland Also… Ms. Noonan spent 27 years at Chemtura Corporation, a global manufacturer of specialty chemicals. | |
| | ![[MISSING IMAGE: ph_tamlaoates-4clr.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_tamlaoates-4clr.jpg) Tamla Oates- Forney Age: 50 Director since 2021 BOARD COMMITTEES • Human Capital and Compensation | | | Tamla Oates-Forney is currently the Senior Vice President, Chief People Officer, at Waste Management, a Fortune 250 environmental services company. Career Highlights • Senior Vice President, Chief People Officer, at Waste Management (December 2018-present) • Various positions of increasing responsibility during a 20-year career at General Electric, including most recently as Vice President, Human Resources, GE Energy Connections, an electrification and automation business included in the General Electric Company multinational conglomerate from 2014 to April 2018 Skills / Experience • Leadership experience • Extensive knowledge of the industrial sector Education • BS in Business Administration, University of North Carolina at Chapel Hill Also… • Ms. Oates-Forney serves on the board of advisors of the University of North Carolina Kenan—Flagler Business School. | |
| | ![[MISSING IMAGE: ph_johnmurphy-4c.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_johnmurphy-4c.jpg) John R. Murphy Age: 71 Director since 2012 BOARD COMMITTEES • Audit (Chair) • Governance and Sustainability OTHER BOARDS • O’Reilly Automotive, Inc. • Apria, Inc. | | | John R. Murphy served as Summit Materials’ Interim Chief Financial Officer from January 2013 to May 2013 and from July 2013 to October 2013. Career Highlights • Senior Vice President and Chief Financial Officer of Smurfit-Stone Container Corporation (2009-2010) • Various senior management roles, including Chief Financial Officer and President and Chief Operating Officer and as President and Chief Executive Officer, of Accuride Corporation (1998-2008) Skills / Experience • Financial expertise • Management experience Education • BS in Accounting, Pennsylvania State University • MBA, University of Colorado Also… Mr. Murphy is a Certified Public Accountant. | |
| | ![[MISSING IMAGE: ph_stevewunning-4c.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_stevewunning-4c.jpg) Steven H. Wunning Age: 71 Director since 2016 BOARD COMMITTEES • Human Capital and Compensation (Chair) • Governance and Sustainability OTHER BOARDS • The Sherwin Williams Company • Kennametal Inc. • Black & Veatch Holding Company | | | Steven H. Wunning served as Group President and Executive Office Member for Caterpillar Inc. (“Caterpillar”) from January 2004 until his retirement in February 2015. He joined Caterpillar in 1973. Career Highlights • Group President and Executive Office Member for Caterpillar from January 2004 until his retirement in February 2015 • Various executive positions at Caterpillar, including Vice President, Logistics Division from January 2000 to January 2004 and Vice President, Logistics & Product Services Division from November 1998 to January 2000 Skills / Experience • Extensive board and management experience • Industrial and building products industry expertise Education • BS in Metallurgical Engineering from Missouri University of Science and Technology • MBA, University of Illinois Urbana-Champaign Also… Mr. Wunning serves on the Board of Trustees of Missouri University of Science and Technology. | |
| | ![[MISSING IMAGE: ph_susanellerbusch-4c.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_susanellerbusch-4c.jpg) Susan A. Ellerbusch Age: 54 Director since 2018 BOARD COMMITTEES • Audit | | | Ms. Ellerbusch is currently the Senior Vice President, Strategic Direction for the Americas of Air Liquide S.A., a world leader in gases, technologies and services for industry and health, with a presence in 80 countries and more than 3 million customers and patients. Career Highlights • Chief Executive Officer of Air Liquide North America LLC (September 2019-January 2022) • Chief Executive Officer of Air Liquide USA LLC (June 2017-September 2019) • President, Air Liquide Large Industries U.S. (September 2015-June 2017) • Various executive positions, including President, BP Biofuels North America from 2008 to 2015 Skills / Experience • Management and operational experience • Extensive knowledge of chemicals and energy industries Education • BS in genetics, University of Illinois Urbana-Champaign • MBA, University of Illinois Chicago Also… As head of Air Liquide’s operations in the U.S. and Canada, Ms. Ellerbusch led the company’s Large Industries, Industrial Merchant, Health Care, Hydrogen Mobility and Electronics businesses. | |
| | ![[MISSING IMAGE: ph_lance-4clr.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_lance-4clr.jpg) Howard L. Lance Age: 66 Director since 2012 Chairman since 2013 BOARD COMMITTEES • Human Capital and Compensation • Governance and Sustainability OTHER BOARDS • Change Healthcare, Inc. • New Vista Acquisition Corp. | | | Howard L. Lance is the former President and Chief Executive Officer of Maxar Technologies Inc. and its predecessor MacDonald, Dettwiler and Associates Ltd., a global communications and information company, a position he held from May 2016 until January 2019. Career Highlights • President and Chief Executive Officer, Maxar Technologies Inc. (May 2016-January 2019) • Executive Advisor to The Blackstone Group L.P. (2012-April 2016) • President & CEO, Harris Corporation (2003-2011) Skills / Experience • Leadership experience • Extensive management and operational experience Education • BS in Industrial Engineering, Bradley University • MS in Management from the Krannert School of Management at Purdue University Also… Before joining Harris Corporation, Mr. Lance was co-president of NCR Corporation and Chief Operating Officer of its Retail and Financial Group. Previously, he spent 17 years with Emerson Electric Co., where he held senior management positions including Executive Vice President of its Electronics and Telecommunications segment, Chief Executive Officer and director of its Astec electronics subsidiary in Hong Kong, Group Vice President of its Climate Technologies segment and President of its Copeland Refrigeration division. | |
| | ![[MISSING IMAGE: ph_annewade-4c.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/ph_annewade-4c.jpg) Anne K. Wade Age: 50 Director since 2016 BOARD COMMITTEES • Audit OTHER BOARDS • Man Group plc • Big Society Capital Ltd. | | | Anne K. Wade is currently a partner at Leaders’ Quest, an organization focused on culture, values, and driving social and financial impact in major corporations. Career Highlights • As part of Leaders’ Quest, Co-Director of the Banking Futures initiative in the UK (2014-2017) • Senior Vice President and Director, Capital International, a part of the Capital Group Companies (1995-2012) Skills / Experience • Financial and investing experience • Extensive knowledge of infrastructure sectors Education • BA, magna cum laude, Harvard University • MS, London School of Economics Also… Ms. Wade is a Member of the Board of Trustees of the Heron Foundation in New York. | |
Technologies Ltd. ("Maxar"), formerly known as MacDonald, Dettwiler and Associates Ltd., a global communications and information company, since May 2016. Mr. Lance also sits on Maxar's board of directors. Prior to joining Maxar, Mr. Lance was an Executive Advisor to The Blackstone Group L.P. ("Blackstone") and as part of his duties as such, he served on the boards of certain Blackstone portfolio companies. He is also a director of Change Healthcare, Inc. He was Chairman of the Board of Directors, President and Chief Executive Officer of Harris Corporation from 2003 to 2011. Before joining Harris Corporation, Mr. Lance was president of NCR Corporation and Chief Operating Officer of its Retail and Financial Group. Previously, he spent 17 years with Emerson Electric Co., where he held senior management positions including Executive Vice President of its Electronics and Telecommunications segment, Chief Executive Officer and director of its Astec electronics subsidiary in Hong Kong, Group Vice President of its Climate Technologies segment and President of its Copeland Refrigeration division. Mr. Lance has a Bachelor of Science degree in Industrial Engineering from Bradley University and a Master of Science degree in Management from the Krannert School of Management at Purdue University.
In nominating Mr. Lance for reelection as a director, the Board considered Mr. Lance's significant management and operational experience from his service in various senior management roles, including as President and Chief Executive Officer of Maxar and of Harris Corporation and as President and Chief Operating Officer of NCR Corporation.
Anne K. Wade, 46, was appointed by the Board as a director in January 2016,one year, at which time she was also appointedall directors will be elected to the Audit Committee. From 1995 to 2012, Ms. Wade held positions of increasing responsibility, most recently as Senior Vice President and Director,serve for one year terms at Capital International, a part of the Capital Group Companies, the Los Angeles based investment management firm. Ms. Wade is currently a partner at Leaders' Quest, an organization focused on culture, values, and driving social and financial impact in major corporations. In that capacity she was the co-Director of the BankingFutures initiative in the United Kingdom. Ms. Wade also currently serves on the Boards of Directors of the John Laing Group plc, where she chairs the Remuneration Committee, Big Society Capital Ltd in London, and the Heron Foundation in New York City. She previously served on the Board of Directors of Holcim Ltd from 2013 to 2015, and was a member of its Governance and Strategy Committee. Ms. Wade has a Bachelor of Arts degree, Magna Cum Laude, from Harvard University and a Master of Science from the London School of Economics.all subsequent Annual Meetings.
In nominating Ms. Wade for reelection as a director, the Board considered Ms. Wade's significant financial and investing experience, primarily in infrastructure sectors including the global building materials and construction industries, including as Senior Vice President and Director of Capital International.
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Ted A. Gardner, 60, was elected as a director in August 2009. He is a Managing Partner of Silverhawk Capital Partners (together with its affiliates, "Silverhawk"). Prior to co-founding Silverhawk in 2005, Mr. Gardner was a Managing Partner of Wachovia Capital Partners (formerly, First Union Capital Partners) from 1989 until 2002. He was a director and Chairman of the Compensation Committee of Kinder Morgan, Inc. from 1999 to 2007, a director and the Chairman of the Audit Committee of Encore Acquisition Company from 2001 to 2010, a director of Kinder Morgan Energy Partners from 2011 to 2014 and a director and Chairman of the Audit Committee of Athlon Energy, Inc. from 2013 to 2014. He is currently a director of Kinder Morgan, Inc., Incline Niobrara Partners, LP and Spartan Energy Partners. Mr. Gardner received a Bachelor of Arts degree in Economics from Duke University and a Juris Doctor and Masters of Business Administration from the University of Virginia.
Mr. Gardner brings to the Board extensive business and leadership experience, including as a Managing Partner of Silverhawk and Managing Partner of Wachovia Capital Partners (formerly, First Union Capital Partners). In addition, Mr. Gardner has over 30 years of private equity investing experience.
John R. Murphy, 67, was elected as a director and Chairman of the Audit Committee in February 2012. Since March 2015, he also has served as a member of the Nominating and Corporate Governance Committee. Mr. Murphy served as Summit Materials' Interim Chief Financial Officer from January 2013 to May 2013 and from July 2013 to October 2013. He was Senior Vice President and Chief Financial Officer of Smurfit-Stone Container Corporation from 2009 to 2010 and served in various senior management roles from 1998 to 2008, including Chief Financial Officer and President and Chief Operating Officer and as President and Chief Executive Officer of Accuride Corporation. Accuride Corporation filed for Chapter 11 bankruptcy protection in October 2009 and emerged in 2010. Since 2003, Mr. Murphy has served on the Board, the Governance Committee and as Chairman of the Audit Committee of O'Reilly Automotive, Inc. He has also served as a director and Audit Committee Chairman of DJO Global Inc. since January 2012. Mr. Murphy was elected as a director and Audit Committee member of Graham Packaging in February 2011. Graham Packaging was subsequently sold in September 2011. Mr. Murphy has a Bachelor of Science degree in Accounting from Pennsylvania State University and a Master of Business Administration degree from the University of Colorado and is a Certified Public Accountant.
Mr. Murphy brings to the Board extensive financial knowledge, including from his service as Chief Financial Officer of Smurfit-Stone Container Corporation and Accuride Corporation.
Steven H. Wunning, 67, was appointed by the Board as a director in August 2016, at which time he was also appointed to the Compensation Committee. He served as Group President and Executive Office Member for Caterpillar Inc. ("Caterpillar") from January 2004 until his retirement in February 2015. Mr. Wunning joined Caterpillar in 1973 and held a variety of positions of increasing responsibility with Caterpillar, including Vice President, Logistics Division from January 2000 to January 2004 and Vice President, Logistics & Product Services Division from November 1998 to January 2000. Mr. Wunning is also a director of The Sherwin Williams Company, Kennametal Inc., Black & Veatch Holding Company and Neovia Logistics Services, LLC. Mr. Wunning serves on the Board of Trustees of Missouri University of Science and Technology. He obtained his Bachelor of Sciences degree in Metallurgical Engineering from Missouri University of Science and Technology and an executive Masters of Business Administration from the University of Illinois.
Mr. Wunning brings to the Board expansive operating and board experience across the industrial and building products industries, including his more than 40 years at Caterpillar.
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Thomas W. Hill, 62, is the founder of Summit Materials and has been President and Chief Executive Officer since its inception. He has been a member of the Board of Directors since August 2009. From 2006 to 2008, he was the Chief Executive Officer of Oldcastle, Inc. ("Oldcastle"), the North American arm of CRH plc, one of the world's leading construction materials companies. Mr. Hill served on the CRH plc Board of Directors from 2002 to 2008 and, from 1992 to 2006, ran the Materials division of Oldcastle. Mr. Hill served as Chairman of the American Road and Transportation Builders Association ("ARTBA") from 2002 to 2004, during congressional consideration of the multi-year transportation bill "SAFETEA-LU." Mr. Hill has been Treasurer of both the National Asphalt Pavement Association and the National Stone Association, and he remains active with ARTBA's Executive Committee. Mr. Hill received a Bachelor of Arts in Economics and History from Duke University and a Masters of Business Administration from Trinity College in Dublin, Ireland.
Mr. Hill brings to the Board extensive knowledge of our industry and significant experience in leading companies, as well as his ongoing contributions as the Company's CEO.
Neil P. Simpkins, 52, was elected as a director in August 2009. He is a Senior Managing Director of the Corporate Private Equity Group at Blackstone. Since joining Blackstone in 1998, Mr. Simpkins has led the acquisitions of TRW Automotive, Vanguard Health Systems, Team Health, LLC, Apria Healthcare Group, Summit Materials, Change Healthcare, Inc. and Gates Corporation. Before joining Blackstone, Mr. Simpkins was a Principal at Bain Capital. While at Bain Capital, Mr. Simpkins was involved in the execution of investments in the consumer products, industrial, healthcare and information industries. Prior to joining Bain Capital, Mr. Simpkins was a consultant at Bain & Company in the Asia Pacific region and in London. He currently serves as a Director of Apria Healthcare Group, Gates Corporation, Change Healthcare, Inc. and Team Health Inc. Mr. Simpkins graduated with honors from Oxford University and received a Masters of Business Administration from Harvard Business School.
Mr. Simpkins brings to the Board significant financial and business experience, including as a Senior Managing Director in the Private Equity Group at Blackstone and Principal at Bain Capital.
Joseph S. Cantie, 54, was appointed by the Board as a director in May 2016, at which time he was also appointed to the Audit Committee. He is the former Executive Vice President and Chief Financial Officer of ZF TRW, a division of ZF Friedrichshafen AG ("ZF"), a global automotive supplier, a position he held from May 2015 until January 2016. He served in similar roles at TRW Automotive Holdings Corp., which was acquired by ZF Industries in May 2015, since 2003. Prior to that time, Mr. Cantie held other executive positions at TRW, which he joined in 1999. From 1996 to 1999, Mr. Cantie served in several executive positions with LucasVarity Plc, including serving as Vice President and Controller. Prior to joining LucasVarity, Mr. Cantie spent 10 years with KPMG. He is currently a director for TopBuild Corp. where he serves on the Audit (Chairman), Compensation and Governance Committees, and for Delphi Technologies PLC where he serves on the Audit (Chairman) and Finance Committees. Mr. Cantie is a certified public accountant and holds a Bachelor of Science degree from the State University of New York at Buffalo.
Mr. Cantie brings to the Board more than 30 years of financial and operating experience primarily in the industrials sector, which, along with his tenure at a major accounting firm, provide a diversified knowledge base and additional perspectives to the Board.
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Director Independence Determination.Determination
, and “financially literate” as required by NYSE rules and (ii) each of Messrs. Cantie and Murphy qualify as a “financial expert” as defined by SEC regulations.
Stockholders and other interested parties may communicate with the Board by writing to the Chief Legal Officer, Summit Materials, Inc., 1550 Wynkoop Street, 3rd Floor, Denver, Colorado 80202. Written communications may be addressed to the Chairman of the Board, the chairperson of any of the Audit,
Risk Oversight. The Board exercises direct oversight of strategic risks to the Company. The Audit Committee reviews guidelines and policies governing the process by which senior management assesses and manages the Company's exposure to risk, including the Company's major financial and operational risk exposures and the steps management takes to monitor and control such exposures. The Compensation Committee oversees risks relating to the Company's compensation policies and practices. Each committee charged with risk oversight reports to the Board on those matters.
With respect to cybersecurity risk oversight, our Board and our Audit Committee receive updates from our information technology team to assess the primary cybersecurity risks facing the Company and the measures the Company is taking to mitigate such risks. In addition to such updates, our Board and our Audit Committee receive updates from management as to changes to the Company's cybersecurity risk profile or significant newly identified risks.
Corporate Governance Documents. Please visit ourOur investor relations website atinvestors.summit-materials.com/govdocs, "Governance“Governance Documents," for” has additional information on our board governance and corporate governance, including:
•- including our Corporate Governance
Guidelines; •- Guidelines, our Code of Business Conduct and Ethics; and
•- the charters approved by the Board for the Audit Committee, the Human Capital and Compensation Committee, and the
NominatingGovernance andCorporate GovernanceSustainability Committee.
Board Meetings and Committees |
The Board meets regularly during the year and holds special meetings and acts by unanimous written consent wheneverwhen circumstances require. During 2017,2021, there were fiveseven (7) meetings of the Board. Each director attended at least 75% of the aggregate of the total number of meetings of the Board (held during the period for which he or she was a director) and the total number of meetings held by all committees on which he or she served (during the periods that he or she served) during 2017.2021. In addition, directors are expected to make every effort to attend any meetings of stockholders. All of our directors attended the 20172021 Annual Meeting of Stockholders.
The Board has established an Audit Committee, a Human Capital and Compensation Committee, and a NominatingGovernance and Corporate Governance Committee.Sustainability Committee (collectively, the “Committees”). The Committees keep the Board informed of their actions and provide assistance toassist the Board in fulfilling its oversight responsibility to stockholders. The table below provides current membership information as well as meeting information for the last fiscal year.
| Name | | | Audit Committee | | | Human Capital and Compensation Committee | | | Governance and Sustainability Committee | |
| Anne P. Noonan | | | | | | | | | | |
| Howard L. Lance* | | | | | | • | | | • | |
| Joseph S. Cantie | | | • | | | | | | | |
| Anne M. Cooney | | | | | | • | | | Chair | |
| Susan A. Ellerbusch | | | • | | | | | | | |
| John R. Murphy | | | Chair | | | | | | • | |
| Tamla Oates-Forney | | | | | | • | | | | |
| Anne K. Wade | | | • | | | | | | | |
| Steven H. Wunning | | | | | | Chair | | | • | |
| Total Meetings in 2021 | | | 8 | | | 6 | | | 4 | |
Name | Audit Committee | Compensation Committee | Nominating and Corporate Governance Committee | |||
Thomas W. Hill | ||||||
Howard L. Lance* | | X | Chair | |||
Joseph S. Cantie | X | | | |||
Ted A. Gardner | X | X | | |||
John R. Murphy | Chair | | X | |||
Neil P. Simpkins | | Chair | X | |||
Anne K. Wade | X | | | |||
Steven H. Wunning | | X | X | |||
Total Meetings in 2017 | 6 | 4 | 4 |
*Denotes independent chairmanIndependent Chairman of theBoard
•- assisting the Board in monitoring the performance of our internal audit function;•
•reviewing with management and our independent registered public accounting firm our annual and quarterly financial statements;12 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT••establishing procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters;and••preparing the Audit Committee Report that the rules and regulations of the SEC require to be included in our annual proxystatement.•review and discuss with management and our independent registered public accounting firm our guidelines and policies with respect to risk assessment and risk management, including the major financial risk exposures and the steps management has taken to monitor and control such exposures; and•review our information technology security controls with our Head of Information Technology and evaluate the adequacy of our information technology security program, compliance and controls with the Head of Information Technology.Audit Committee Member Independence; Financial Literacy; Financial ExpertAudit Committee Member Independence; Financial Literacy; Financial Expert Independent under NYSE
governance standards
and
Rule 10A-3 of Exchange
Act Financially Literate FinanciallyLiterateAudit Committee
Financial Expert John R. Murphy (Chair) ✓ ✓ ✓ Joseph S. Cantie ✓ ✓ ✓Ted A. Gardner ✓ Susan A. Ellerbusch ✓ ✓ Anne K. Wade ✓ ✓ Human Capital and Compensation CommitteeIn 2021, the Company’s Compensation Committee
was renamed the Human Capital and Compensation Committee to emphasize the Company’s commitment to (i) diversity, equity, and inclusion, (ii) talent management, and (iii) fostering employee engagement and strengthening the Company’s culture. Our Human Capital and Compensation Committee consists of Messrs.
Simpkins,Wunning and LanceGardnerandWunning,Mss. Cooney and Oates-Forney, with Mr.SimpkinsWunning serving as chair.Our Human Capital and Compensation Committee is responsible for, among other things:•reviewing and approving or making recommendations to the Board with respect to corporate goals and objectives relevant to the compensation of our Chief Executive Officer, evaluating his/her performance in light of those goals and objectives and determining and approving his/her compensation level based on such evaluation;••reviewing and approving, or making recommendations to the Board with respect to, the compensation of our other executive officers, including annual base salary, bonus, equity-based incentives and other benefits;••reviewing and recommending the compensation of our directors;••reviewing and discussing annually with management our"Compensation“Compensation Discussion andAnalysis"Analysis” disclosure required by SEC rules;••- preparing the Compensation Committee Report required by the SEC to be included in our annual proxy statement;
and••reviewing and making recommendations with respect to our equity compensationplans.plans;•review, periodically, the Company’s (i) talent management strategies, such as the Company’s recruitment, development, promotion and retention programs; (ii) diversity and inclusion within the Company; and (iii) employee engagement and company culture;•report to the Board with respect to the Company’s human capital management; and•reviewing and discussing with our Chief Executive Officer the Company’s succession plans for key positions at the senior officer level, including the qualifications, experience, and development priorities for these individuals.Governance and Sustainability CommitteeIn 2021, the Company’s Nominating and Corporate Governance Committee
was renamed the Governance and Sustainability Committee to emphasize the Company’s commitment to (i) being socially responsible and aligning such responsibility with the Company’s overall business strategy and (ii) implementing policies and initiatives relating to the environment with respect to energy management, climate change, and sustainability. Our
NominatingGovernance andCorporate GovernanceSustainability Committee consists of Messrs. Lance, Murphy,Simpkinsand Wunning and Ms. Cooney, withMr. LanceMs. Cooney serving as chair.
2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 13OurNominatingGovernance andCorporate GovernanceSustainability Committee is responsible for, among other things:•assisting our Board in identifying prospective director nominees and recommending nominees to the Board;••overseeing the annual evaluation of management;•overseeing the annual evaluation of the Boardand management;in conjunction with our Chairman’s regular informal interviews with our current directors to ensure the Board is functioning properly;••reviewing and advising the Board on developments in corporate governance practices;••developing and recommending a set of corporate governance guidelines;and••recommending members for each committee of ourBoard.
•overseeing the Company’s approach to social responsibility and policies and initiatives related thereto.Director NominationsDirector NominationsThe
NominatingGovernance andCorporate GovernanceSustainability Committee identifies individuals believed to be qualified as candidates to serve on the Board and selects, or recommends that the Board select, the nominees for all directorships to be filled by the Board or by our stockholders at an annual or special meeting.In identifying candidates for membership on the Board, the Committee takes into account all factors it considers appropriate, which may include:•individual qualifications, including strength of character, mature judgment, familiarity with theCompany'sCompany’s business and industry, independence of thought and an ability to work collegially; and••all other factors the Committee considers appropriate, which may include age, diversity of background, existing commitments to other businesses, potential conflicts of interest with other pursuits, legal considerations such as antitrust issues, corporate governance background,various andrelevant career experience, relevant technical skills, relevant business or government acumen, financial and accounting background, executive compensation background and the size, composition and combined expertise of the existing Board.Although theNominatingGovernance andCorporate GovernanceSustainability Committee considers diversity in all its forms, including diversity of viewpoints, background and experiences, the Company does not have a formal diversity policy. The Board is proud of the gender diversity it has been able to accomplish over the last few years, which has resulted in the Board being comprised of 56% females and 44% males. In addition, the Board made strides in 2021 in other forms of diversity, including racial and ethnic diversity, in connection with the appointment of Ms. Oates-Forney, who identifies as African American.The Committee alsomay consider the extent to which the candidate would fill a present need on the Board. When evaluating whether to re-nominate existing directors, the Committee considers matters relating to the retirement of current directors, as well as the performance of such directors.
TheNominatingGovernance andCorporate GovernanceSustainability Committee evaluates director candidates recommended by stockholders on the same basis as it considers other nominees. Any recommendation submitted to the Chief Legal Officer and Secretary should be in writing and should include any supporting material the stockholder considers appropriate in support of that recommendation, but must include information that would be required under the rules of the SEC to be included in a proxy statement soliciting proxies for the election of such candidate and the written consent of the candidate to serve as one of our directors, if elected. Stockholders wishing to propose a candidate for consideration may do so by submitting the above information to the attention of the Chief Legal Officer and Secretary, Summit Materials, Inc., 1550 Wynkoop Street, 3rd Floor, Denver, Colorado 80202. All recommendations for nomination received by the Chief Legal Officer and Secretary that satisfy the requirements of our Second Amended and Restated Bylaws (the"Bylaws"“Bylaws”) relating to such director nominations will be presented to theNominatingGovernance andCorporate GovernanceSustainability Committee for its consideration. Please see the section entitled"Proposals of Stockholders"“Future Shareholder Proposals and Nominations” for information regarding the advance notice provisions applicable to stockholder director nominations set forth in our Bylaws.Compensation Committee Interlocks and Insider Participation
Compensation Committee Interlocks and Insider ParticipationDuring
2017,2021, the members of the Human Capital and Compensation Committee were Messrs.Simpkins,Wunning and LanceGardnerandWunning,Mss. Cooney and Oates-Forney (beginning in May 2021), none of whom was, during the fiscal year, an officer or employee of the Company and none of whom has ever served as an officer of the Company. During2017,2021, none of our executive officers served as a director or member of the compensation committee (or other committee serving an equivalent function) of any other entity whose executive officers served on our Human Capital and Compensation Committee or the Board.Code of Ethics14 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTOurBoard OperationsThe Board believes that the practices it follows and the guidelines it adopts governing how it operates set an important tone at the top. Among other things the Board:•meets regularly;•meets periodically in executive session of its independent directors;•has the authority to retain independent advisors;•enables directors to have access to management;•limits the number of public company boards on which directors may serve;•expects its members as well as the Company’s executives to satisfy the stock ownership guidelines; and•prohibits its members and the Company’s executives from taking specified hedging and pledging actions with the Company’s stock.Executive Sessions and Communications with DirectorsThe Board’s independent directors meet at regularly scheduled executive sessions without management present. Mr. Lance presides at executive sessions of independent directors.Stockholders and other interested parties may communicate with the Board by writing to the Chief Legal Officer and Secretary, Summit Materials, Inc., 1550 Wynkoop Street, 3rd Floor, Denver, Colorado 80202. Written communications may be addressed to the Chairman of the Board, the chairperson of any of the Audit, Governance and Sustainability, and Human Capital and Compensation Committees, or to the non-management or independent directors as a group. The Chief Legal Officer will forward such communications to the appropriate party.Risk OversightThe Board exercises direct oversight of strategic risks to the Company. The Audit Committee reviews guidelines and policies governing the process by which senior management assesses and manages the Company’s exposure to risk, including the Company’s major financial and operational risk exposures and the steps management takes to monitor and control such exposures. The Human Capital and Compensation Committee oversees risks relating to the Company’s compensation and human capital management policies and practices. Each committee charged with risk oversight reports to the Board on those matters.Cybersecurity OversightWith respect to cybersecurity risk oversight, our Board and our Audit Committee receive updates from our information technology team to assess the primary cybersecurity risks facing the Company and the measures the Company is taking to mitigate such risks. In addition to such updates, our Board and our Audit Committee receive updates from management as to changes to the Company’s cybersecurity risk profile or significant newly identified risks.ESG OversightThe Company recognizes that ESG performance is essential to the Company’s long-term success and is an important issue to many of its stockholders. As a result, the Company has implemented the following oversight structure to ensure that the Company’s performance in these areas is monitored appropriately:2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 15![[MISSING IMAGE: tm223385d2-fc_esgover4c.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/tm223385d2-fc_esgover4c.jpg)
In light of the importance of environmental and climate change matters to the Company, its shareholders, communities, customers, and employees, and the associated risks the Company faces, the full Board oversees environmental risk factors and receives regular updates from management and the Company’s sustainability team on the Company’s environmental risk profile and key risk mitigating initiatives. The Company’s management functions involved in overseeing and managing climate risk include, but are not limited to, safety, sustainability, finance and internal audit, and legal. Furthermore, each of the Company’s operations has personnel responsible for maintaining compliance with environmental rules and regulations.In addition, the Company views sustainability as one of its core values and takes its responsibilities to the lands it operates on seriously. The Company has a dedicated Enterprise Risk Committee (the “ERC”) that continually identifies and evaluates environmental and other risks, including the Company’s compliance with environmental rules and regulations. The committee reports to the full Board. The ERC undertakes regular, systematized review of the environmental risks affecting the Company, including those associated with climate change, that may affect the Company’s businesses and also meets with key leaders in the Company’s operations to identify and address such risks.The Company has established an Environmental Management System (the “EMS”) called eVue to facilitate its ongoing compliance with environmental rules and regulations. The Company implemented this system across its operations in 2021.With respect to abnormal weather and other physical effects of climate change, to which, as an outdoor business, the Company is acutely attuned, the Company is seeking to monitor and reduce its contribution to climate change. The Company’s efforts include, but are not limited to, the following:•Establishing clear 2030 and 2050 targets for carbon emissions reductions, including a strategy for achieving net zero emissions by 2050, land use improvement, and social impact;16 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT•Reporting on its sustainability progress annually under the SASB Construction Materials Framework;•Aligning with the United Nations Sustainable Development Goals to guide and influence the Company’s programs and reporting;•Membership in the UN Global Compact;•Recycling of hazardous waste, and use of such waste as an alternative fuel source to power the Company’s cement plants;•Use of hybrid vehicles and equipment;•Use of recycled materials, including recycled asphalt and recycled concrete;•Managing and tracking the Company’s fleet to optimize fuel efficiency and reduce unnecessary consumption;•Managing and mitigating the Company’s waste;•Promoting progressive reclamation and biodiversity focused actions; and•Tracking and managing the Company’s water use, with a focus on areas of water scarcity.The Company also continues to comprehensively focus on its energy inputs, CO2 and other pollutant emissions from its cement plants. From an energy use standpoint, the Company’s alternative fuel usage rate of 35% to 40% at its cement plants is notable in comparison to the average U.S. industry rate of 25% as reported by the U.S. Environmental Protection Agency in 2008. The Company has made advancements in recent years to (i) accept more diverse materials at its hazardous waste recycling business, (ii) increase its alternative fuel use, and (iii) divert thousands of pounds of waste from landfills. The Company has also developed a long-term strategy to address its CO2 emissions from its cement operations that are fully discussed in its 2021 sustainability report.With respect to emissions impacts, in 2021 the Company completed a comprehensive review of the Company’s greenhouse gas (“GHG”) emissions reporting capabilities across all of the Company’s operations for 2020. This assessment focused on Scope 1 and Scope 2 emissions, which represent emissions from direct operations and indirect electricity purchases, respectively.Now that the Company has implemented the appropriate reporting framework and controls, the Company has been able to establish goals related to emissions and other factors contributing to climate change. As the Company systematizes its approach to mitigating its climate impact, it will continue to pursue and expand upon the beneficial initiatives it is already implementing, such as the use of hybrid vehicles, a robust recycling and waste program, and sourcing alternative fuels to power its operations.The Company also seeks to carry out progressive reclamation whenever possible, and it believes in the protection and restoration of areas of high biodiversity value. In 2014, the Company established a partnership with the Wildlife Habitat Council (“WHC”). We currently have seven sites certified by the WHC, covering approximately 2,300 acres across the country. In 2021, our Davenport, Iowa Cement Plant’s Wildlife Restoration Area was awarded Gold Tier WHC Conversation Certification by the WHC. In addition, our reclamation efforts in Kansas, having been awarded the Governor’s Mined Land Reclamation Award by the Kansas Department of Transportation, are an indicator of the Company’s values in action. We remain focused on exploring new, innovative ways in which the Company can meaningfully reduce the environmental impact where we operate and are wholly in support of achieving carbon neutrality by 2050.Finally, the Company values the communities in which it operates and offers engagement through STEM education programs to enhance local education programs, encourage transparency and outreach.Code of EthicsThe Company’s Code of Business Conduct and Ethics applies to all ofourits officers, directors and employees, includingourits principal executive officer, principal financial officer and principal accounting officer, or persons performing similar functions and is posted on our website.OurThe Company’s Code of Business Conduct and Ethics is a"code“code of ethics,"” as defined in Item 406(b) of Regulation S-K.WeThe Company will make any legally required disclosures regarding amendments to, or waivers of, provisions of our Code of Business Conduct and Ethics onourits website.Short Sales and Hedging PolicyTheinformation containedCompany’s Securities Trading Policy prohibits directors, officers, and employees (“Summit Materials Personnel”), family members of Summit Materials Personnel and trusts, corporations and other entities controlled by any such persons (collectively, “Insiders”) from trading in options, warrants, puts and calls or similar instruments on the Company’s securities oraccessible from, our websiteselling such securities “short” (i.e., selling stock that is notpart of this Proxy Statement by referenceowned and borrowing the shares to make delivery). In addition, Summit Materials Personnel are prohibited under the Securities Trading Policy from engaging in any transactions (including variable forward contracts, equity swaps, collars and exchange funds) that are designed to hedge orotherwise.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 17Director CompensationIn 2021, all of theNYSE andCompany’s non-employee directors received annual cash compensation of $100,000. The independent chairperson of thePublic Company Accounting OversightBoard(the "PCAOB"),received an additional $150,000 in cash compensation. The respective chairpersons of the Audit Committee, Human Capital and Compensation Committee and Governance and Sustainability Committee (unless such chairperson isdirectly responsiblealso the chairperson of the Board) received an additional $15,000, $10,000 and $10,000, respectively. Directors who were not employed by us may also receive compensation, from time to time, for service on any special committees of theappointment, compensation, retention and oversight of our independent registered public accounting firm.Board. The Company reimburses its directors for any reasonable expenses incurred by them in connection with services provided in such capacity.In addition,the Audit Committee considers the independence of our independent registered public accounting firm and participates in the selectionduring 2021, all of theindependent registered public accounting firm's lead engagement partner. The Audit Committee has appointed, and, as a matterCompany’s non-employee directors received an annual award ofgood corporate governance, is requesting ratification by our stockholdersrestricted stock units (“RSUs”) valued at $125,000, which amount differs from the grant date fair value of theappointmentRSUs. A grant of 4,374 RSUs was made to each of Messrs. Lance, Cantie, Murphy, and Wunning and Mss. Cooney, Ellerbusch, and Wade on March 30, 2021. A grant of 4,054 RSUs was made to Ms. Oates-Forney when she joined theregistered public accounting firm of KPMG to serve as independent registered public accounting firm forBoard on May 19, 2021. The RSUs were granted under thefiscal year ending December 29, 2018. KPMG has served as our independent registered public accounting firm since 2012.The BoardSummit Materials, Inc. Amended and Restated 2015 Omnibus Incentive Plan (the “Omnibus Incentive Plan”), and theAudit Committee believe that the continued retention of KPMG as the Company's independent registered public accounting firm is in the best interests of the Company and its stockholders. If stockholders do not ratify the selection of KPMG, the Audit Committee will evaluate the stockholder vote when considering the selection of a registered public accounting firm for the audit engagement for the 2018 fiscal year. In addition, even if stockholders ratify the selection of KPMG as independent registered public accounting firm, the Audit Committee may nevertheless periodically request proposals from the major registered public accounting firms and as a result of such process may select KPMG or another registered public accounting firm as our independent registered public accounting firm.THE BOARD RECOMMENDS A VOTE "FOR" RATIFICATION OF THE APPOINTMENT OF KPMG AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 29, 2018.INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMRepresentatives of KPMGterms thereof areexpected to attend the Annual Meeting and will have an opportunity to make a statement and to respond to appropriate questions from stockholders.Consistent with SEC and PCAOB requirements regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation for and overseeing the work of, the independent registered public accounting firm. In recognition of this responsibility, the Audit Committee has established a policy to pre-approve all audit and permissible non-audit services provided by the independent registered public accounting firm.Prior to engagement of the independent registered public accounting firm for the next year's audit, management will submit to the Audit Committee for approval a list of services and related fees expected to be rendered during that year within each of the following four categories of services:•Audit services include audit work performed on the financial statements and internal control over financial reporting, as well as work that generally only the independent registered public accounting firm can reasonably be expected to provide, including comfort letters, statutory audits and discussions surrounding the proper application of financial accounting and/or reporting standards.
•Audit-Related services are for assurance and related services that are traditionally performed by the independent registered public accounting firm, including due diligence related to mergers and acquisitions, employee benefit plan audits and special procedures required to meet certain regulatory requirements.•Tax services include all services, except those services specifically related to the financial statements, performed by the independent registered public accounting firm's tax personnel, including tax analysis; assisting with coordination of execution of tax-related activities, primarily in the area of corporate development; supporting other tax-related regulatory requirements; tax planning; and tax compliance and reporting.•All Other services are those services not captured in the Audit, Audit-Related or Tax categories.
Prior to engagement, the Audit Committee pre-approves independent registered public accounting firm services within each category and the fees of each category are budgeted. The Audit Committee requires the independent registered public accounting firm and management to report actual fees versus the budget periodically throughout the year by category of service. During the year, circumstances may arise when it may become necessary to engage the independent registered public accounting firm for additional services not contemplated in the original pre-approval categories. In those instances, the Audit Committee requires specific pre-approval before engaging the independent registered public accounting firm.The Audit Committee may delegate pre-approval authority to one or more of its members. The member to whom such authority is delegated must report, for informational purposes only, any pre-approval decisions to the Audit Committee at its next scheduled meeting. All of the servicesoutlined in the tablebelow were pre-approvedbelow. Further, the RSU awards are subject to the Company’s incentive clawback policies, as in effect from time to time.Aon’s Human Capital Solutions Practice, a division of Aon plc (“Aon”), the Company’s independent compensation consultant (the “Independent Compensation Consultant”), performs a comprehensive competitive total compensation review for the Company’s non-employee directors every other year. A competitive total compensation study was performed in November 2020, comparing the Company’s total compensation structure and value to peer companies. The Company is currently competitively positioned. In the years the Independent Compensation Consultant does not perform a comprehensive review, they review broader U.S. market trends with the Human Capital and Compensation Committee.Award Type Vesting Termination or Change in Control Provisions RSUs Vest on the first anniversary of the date of grant(1) •Death or Disability / By the Company Without Cause: Unvested portion will immediately vest. •Retirement(2) / Declining to Stand for Re-election to Our Board(3): Prorated portion immediately vests; settled at such time as would have been settled according to the original vesting schedule. •Change in Control: Accelerated only if not continued, converted, assumed or replaced by the Company or successor entity. •By the Company For Cause: Vested and unvested portions are forfeited. (1)Non-employee directors have the right to defer the settlement of annual awards of RSUs until the earlier of (i) the first business day in a year, specified by theAudit Committee.director, that is after the date of vesting provided in the RSU award agreement and (ii) a specified period after the director’s service on the Board ends.(in thousands) 2017 2016 Audit Fees(1)
$ 3,988 $ 4,144 Tax Fees(2)
— 4 Audit-Related Fees
— — All Other Fees
— — Total
$ 3,988 $ 4,148 (1)Represents“Retirement” is defined in theaggregate fees billed for professional servicesdirector form of RSU award agreement as a director’s resignation from service on our Board (other than due to death or disability or termination byKPMGthe Company without cause), prior to the expiration of his or her term and on or after the date he or she attains age seventy.(3)In each case, as of or after the regular annual meeting of stockholders for theauditcalendar year which includes the date ofour financial statements, reviews of our quarterly financial statements and services associated with other SEC filings, including registration statements. Fees relatedgrant.Director Compensation TableThe table below summarizes the compensation paid toregistration statements totaled $115,000 in 2017 and $598,000 in 2016.(2)Represents the aggregate fees billed for professional services by KPMG in connection with routine tax compliance, general tax consulting services and services related to state tax audits. Tax fees related to registration statements totaled $4,000 in 2016.The Audit Committee reviews the Company's financial reporting process on behalf of the Board. Management has the primary responsibility for establishing and maintaining adequate internal control over financial reporting, for preparing the financial statements, and for the reporting process. The Audit Committee members do not serve as professional accountants or auditors, and their functions are not intended to duplicate or to certify the activities of management and the independent registered public accounting firm. The Company's independent registered public accounting firm is engaged to audit and report on the conformity of the Company's financial statements to accounting principles generally accepted in the United States and the effectiveness of the Company's internal control over financial reporting.In this context, the Audit Committee reviewed and discussed with management and the independent registered public accounting firm the audited financial statementsnon-employee directors for the year endedDecember 30, 2017 (the "Audited Financial Statements")January 1, 2022.Name Fees Earned or
Paid in Cash Stock Awards(1)(2) Total Compensation Howard L. Lance $ 250,000 $ 129,033 $ 379,033 Joseph S. Cantie $ 100,000 $ 129,033 $ 229,033 Anne M. Cooney $ 110,000 $ 129,033 $ 239,033 Susan A. Ellerbusch $ 100,000 $ 129,033 $ 229,033 John R. Murphy $ 115,000 $ 129,033 $ 244,033 Tamla Oates-Forney $ 100,000 $ 128,998 $ 228,998 Anne K. Wade $ 100,000 $ 129,033 $ 229,033 Steven H. Wunning $ 110,000 $ 129,033 $ 239,033 (1)The amounts reported in the Stock Awards column reflect the aggregate grant date fair value of RSUs granted in fiscal 2021, computed in accordance with ASC 718, utilizing the assumptions discussed in Note 13, Stock-Based Compensation,management's assessment of the effectiveness of the Company's internal control overto our audited consolidated financialreporting, and the independent registered public accounting firm's evaluation of the Company's system of internal control over financial reporting. The Audit Committee has discussed with the independent registered public accounting firm the matters required to be discussed by Public Company Accounting Oversight Board (the "PCAOB") Auditing Standard No. 1301,Communications with Audit Committees.In addition, the Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the PCAOB regarding the independent registered public accounting firm's communications with the Audit Committee concerning independence, and has discussed with the independent registered public accounting firm its independence.Based upon the reviews and discussions referred to above, the Audit Committee recommended to the Board that the Audited Financial Statements bestatements included in theCompany's2021 AnnualReport on Form 10-K for the year ended December 30, 2017, for filing with the Securities and Exchange Commission.The Audit CommitteeJohn R. Murphy, ChairJoseph S. CantieTed A. GardnerAnne K. WadeBENEFICIAL OWNERSHIP OF SHARESThe following table sets forth the beneficial ownership of shares of our Class A Common Stock and LP Units by (1) each person known to us to beneficially own more than 5% of any class of the outstanding voting securities of the Company, (2)January 1, 2022, each of our non-employee directors (other than Ms. Oates-Forney) held 4,374 RSUs and Ms. Oates-Forney held 4,054 RSUs. As noted above, our targeted equity value is $125,000 annually. The value in this column does not necessarily match the $125,000 target because we calculate
18 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTthe number of RSUs to grant based on the 20-day average closing stock price immediately preceding the grant date in order to mitigate the potential impact of short-term stock price swings on our equity grants.(2)We did not make any option awards to directors in fiscal 2021. As of January 1, 2022, Messrs. Lance and Murphy held 81,611 and 10,220 time-vesting Leverage Restoration Options, respectively. Time-vesting Leverage Restoration Options held by our directors have the same vesting terms as those held by our NEOs and(3) all of our directors and executive officers as a group. Percentage of beneficial ownership of (1) Class A Common Stock is based upon 111,228,077 shares issued and outstanding and (2) LP Units is based upon 114,813,591 LP Units outstanding (including 111,228,077 LP Units held by the Company),described ineach case as of March 19, 2018. Percentage of combined voting power is based upon 114,560,343 votes represented by outstanding securities, consisting of (1) 111,228,077 shares of Class A Common Stock issued and outstanding and (2) 3,332,266 LP Units outstanding and eligible to vote, excluding LP Units held by the Company, in each case as of March 19, 2018. The Company is the general partner of Summit Materials Holdings L.P. ("Summit Holdings"), which indirectly owns 100% of the limited liability interests of Summit Materials, LLC ("Summit LLC"). Except as otherwise noted, (i) the information is as of March 19, 2018, and (ii) the address of each beneficial owner is c/o Summit Materials, Inc., 1550 Wynkoop Street, 3rd floor, Denver, Colorado 80202. Beneficial ownership is determined in accordance with the rules and regulations of the SEC.Class A Common Stock(1) �� LP Units(1) Combined Voting Power(2) Name of Beneficial Number Percent Number Percent Number Percent Owner Vanguard Group Inc.(3)
9,156,810 8.2 % — — 9,156,810 8.0 % FMR LLC(4)
7,496,349 6.7 % — — 7,496,349 6.5 % BlackRock, Inc.(5)
7,056,682 6.3 % — — 7,056,682 6.2 % Prudential Financial, Inc./Jennison Associates LLC(6)
5,823,387 5.2 % — — 5,823,387 5.1 % Thomas W. Hill(7)
403,400 * 619,425 * 1,022,825 * Howard L. Lance(8)(9)
195,559 * 135,772 * 331,331 * Joseph S. Cantie(9)(10)
8,810 * — — 8,810 * Ted A. Gardner(9)(11)
38,009 * 162,752 * 200,761 * John R. Murphy(9)(12)
18,974 * 4,274 * 23,248 * Neil P. Simpkins(9)(13)
4,098 * — — 4,098 * Anne K. Wade(9)(14)
10,601 * — — 10,601 * Steven H. Wunning(9)(15)
8,787 * — — 8,787 * Michael J. Brady(16)
330,454 * 283,649 * 614,103 * Brian J. Harris(17)
327,490 * 332,699 * 660,189 * M. Shane Evans(18)
203,113 * 78,525 * 281,638 * Douglas C. Rauh(19)
3,644 * — — 3,644 * All Directors and Executive Officers as a Group (15 persons)(20)
1,683,414 1.5 % 1,764,509 1.5 % 3,447,923 3.0 % *Less than 1%.(1)Subject to the terms of the Exchange Agreement, LP Units are exchangeable for shares of our Class A Common Stock on a one-for-one basis. See "Certain Relationships and Related Person Transactions—Exchange Agreement." Beneficial ownership of LP Units reflected in this table is not reflected as beneficial ownership of shares of our Class A Common Stock for which such units may be exchanged. See "Executive Compensation—Narrative“Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Pre-IPO Long-Term IncentiveAwards" for a description of the LP Units.(2)Represents percentage of voting power of the Class A Common Stock and Class B Common Stock of the Company voting together as a single class and gives effectAwards (Value From Modifications tovoting power of the Class B Common Stock, excluding options that are vested or will vest within 60 days as well as outstanding warrants. The Class B Common Stock provides holders who also hold LP Units with a number of votes thatEliminate Misalignment Post-IPO).”
2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 19OUR PAYOur “Say-on-Pay” Resolution Received 98% Support in 2021.![[MISSING IMAGE: tm123_chrt-tco.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/tm123_chrt-tco.jpg)
We believe our executive compensation structure isequal to the aggregate number of LP Units held by such holders. Asof March 19, 2018, holders of the LP Units held all of the issued shares of our Class B Common Stock that were outstanding and the total number of votes that were represented by the Class B Common Stock was 3,332,366. In addition to the voting power of the Class B Common Stock conferred to him and the Hill Trust through their ownership of LP Units, Mr. Hill has sole voting power over 2,244,154 votes represented by the Class B Common Stock through revocable proxies granted to him by certain pre-IPO investors that hold LP Units, including members of management. Mr. Hill has no pecuniary interest in the LP Units held by such other LP Unit holders and disclaims any beneficial ownership in such LP Units.(3)The number of shares held was obtained from the holder's Schedule 13G/A filing with the SEC dated February 9, 2018, which reports ownership as of December 31, 2017. The Schedule 13G/A filing indicates that the holder, Vanguard Group Inc. ("Vanguard") has sole power to vote or direct the vote of 214,818 shares of our Class A Common Stock, shared power to vote or direct the vote of 19,073 shares of our Class A Common Stock, sole power to dispose or direct the disposition of 8,932,128 shares of our Class A Common Stock, and shared power to dispose or direct the disposition of 224,682 shares of our Class A Common Stock. The address of Vanguardcompetitive, is100 Vanguard Blvd., Malvern, PA 19355.(4)The number of shares held was obtained from the Schedule 13G filing made by FMR LLC ("FMR") and Abigail P. Johnson with the SEC dated February 13, 2018, which reports ownership as of December 31, 2017. Based solely on Schedule 13G jointly filed with the SEC on February 13, 2018 by FMR and Abigail P. Johnson, Abigail P. Johnson is a Director, the Chairman, and the Chief Executive Officer of FMR. Members of the Johnson family, including Abigail P. Johnson, are the predominant owners, directly or through trusts, of 49% of the voting power of FMR. Members of the Johnson family may be deemed to form a controlling group with respect to FMR. Neither FMR nor Abigail P. Johnson has the sole power to vote or direct the voting of the common stock owned directly by the various investment companies ("Fidelity Funds") advised by Fidelity Management & Research Company ("FMR Co."), a wholly owned subsidiary of FMR, which power resides with the Fidelity Funds' Boards of Trustees. FMR Co. carries out the voting of the common stock under written guidelines established by the Fidelity Funds' Boards of Trustees. The Schedule 13G filed made by FMR and Abigail P. Johnson indicates that they have sole power to vote or direct the vote of 161,084 shares of our Class A Common Stock and sole power to dispose or direct the disposition of 7,496,349 shares of our Class A Common Stock. The address of FRM and Abigail P. Johnson is 245 Summer Street, Boston, Massachusetts 02210.(5)The number of shares held was obtained from the holder's Schedule 13G filing with the SEC dated January 23, 2018, which reports ownership as of December 31, 2017. The Schedule 13G filing indicates that the holder, BlackRock, Inc. ("BlackRock") had sole power to vote or direct the vote of 6,812,358 shares of our Class A Common Stock and sole power to dispose or to direct the disposition of, 7,056,682 shares of our Class A Common Stock. The address of BlackRock is 55 East 52nd Street, New York, NY 10055.(6)The number of shares held was obtained from the Schedule 13G filings made by Prudential Financial, Inc. ("Prudential") and Jennison Associates LLC ("Jennison") with the SEC dated January 19, 2018 and February 6, 2018, respectively, which report ownership as of December 31, 2017. Prudential indirectly owns 100% of equity interests of Jennison and certain other investment funds. As a result, Prudential may be deemed to have the power to exercise or to direct the exercise of such voting and/or dispositive power that Jennison and its other affiliates may have with respect to our Class A Common Stock. The Schedule 13G filed by Jennison indicates it has sole power to vote or direct the vote of 5,810,726 shares of our Class A Common Stock and shared power to dispose or direct the disposition of 5,810,726 shares of our Class A Common Stock. The Schedule 13G filed by Prudential indicates it beneficially owns 5,823,387 shares of our Class A Common Stock, consisting of the 5,810,726 shares held by Jennison and 12,661 shares held by Quantitative Management Associates LLC (with respect to which it has sole power to vote or direct the vote of 50,166 shares of our Class A Common Stock, shared power to vote or direct the vote 5,773,221 shares of our Class A Common Stock, sole power to dispose or direct the disposition of 50,166 shares of our Class A Common Stock, and shared power to dispose or direct the disposition of 5,773,221 shares of our Class A Common Stock). The address of Prudential is 751 Broad Street, Newark, NJ 07102. The address of Jennison is 466 Lexington Avenue, New York, NY 10017.(7)Includes (i) 231,670 options, including Leverage Restoration Options (as described in "Executive Compensation—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Pre-IPO Long-Term Incentive Awards") issued to Mr. Hill that are vested or will vest within 60 days, (ii) 29,463 warrants issued to Mr. Hill at the time of our IPO, (iii) 141,902 shares of our Class A Common Stock owned by Mr. Hill, (iv) 592,456 LP Units held by Mr. Hill, (v) 365 shares of our Class A Common Stock held by the Hill Trust, a trust for which Mr. Hill's spouse serves as trustee and as to which Mr. Hill could be deemed to have beneficial ownership, and (vi) 26,969 LP Units held by The Hill Trust. See "Certain Relationships and Related Person Transactions—Warrant Issuances." Amounts for Mr. Hill do not include 2,244,154 LP Units for which Mr. Hill has sole voting power through revocable proxies granted to him. See footnote (2).(8)Includes (i) 184,958 options issued to Mr. Lance that are vested or will vest within 60 days, (ii) 135,772 LP Units held by Mr. Lance, and (iii) 10,601 shares of our Class A Common Stock held by Mr. Lance.
(9)Does not include unvested RSUs held by our non-employee directors in connection with their service as directors.(10)Includes 8,810 shares of our Class A Common Stock owned by Mr. Cantie.(11)Includes (i) 10,601 shares of our Class A Common Stock held by Mr. Gardner, and (ii) 27,408 warrants and (iii) 162,752 LP Units held by Gardner Family Investments, LLC, a limited liability company controlled by Mr. Gardner. Mr. Gardner has sole voting and dispositive power over such warrants and LP Units.(12)Includes (i) 7,665 options issued to Mr. Murphy that are vested or will vest within 60 days, (ii) 4,274 LP Units held by Mr. Murphy and (iii) 11,309 shares of our Class A Common Stock owned by Mr. Murphy.(13)Includes 4,098 shares of our Class A Common Stock owned by Mr. Simpkins.(14)Includes 10,601 shares of our Class A Common Stock owned by Ms. Wade.(15)Includes 8,787 shares of our Class A Common Stock owned by Mr. Wunning.(16)Includes (i) 317,497 options issued to Mr. Brady that are vested or will vest within 60 days, (ii) 283,649 LP Units held by Mr. Brady, (iii) 6,105 shares of our Class A Common Stock owned by Mr. Brady, and (iv) 6,852 warrants issued to Mr. Brady at the time of our IPO.(17)Includes (i) 199,906 options issued to Mr. Harris that are vested or will vest within 60 days, (ii) 67,584 shares of our Class A Common Stock owned by Mr. Harris, and (iii) 332,699 LP Units and (iv) 60,000 shares of our Class A Common Stock held by The Harris Family 2014 Trust fbo Michael J. Harris and The Harris Family 2014 Trust fbo Cameron I.J. Harris, trusts for which Mr. Harris' spouse serves as trustee and as to which Mr. Harris could be deemed to have beneficial ownership.(18)Includes (i) 190,559 options issued to Mr. Evans that are vested or will vest within 60 days, (ii) 78,525 LP Units held by Mr. Evans, and (iii) 12,554 shares of our Class A Common Stock owned by Mr. Evans.(19)Includes 3,644 shares of our Class A Common Stock held by Mr. Rauh.(20)Includes (i) 1,247,311 options that are vested or will vest within 60 days, (ii) 1,764,509 LP Units, (iii) 63,723 warrants issued at the IPO and (iv) 372,380 shares of our Class A Common Stock.
bonuses and equity incentive compensationITEM 3—NONBINDING ADVISORY VOTE ON THE COMPENSATION OF OUR NEOsUnder the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") and Section 14A of the Exchange Act, our stockholders are entitled to vote to approve, on a nonbinding advisory basis, the compensation of our NEOs, as disclosed in this Proxy Statement in accordance with SEC rules. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our NEOs and the philosophy, policies and practices described in this Proxy Statement. The compensation of our NEOs subject to the vote is disclosed in the Compensation Discussion and Analysis, the compensation tables, and the related narrative disclosure contained in this Proxy Statement. As discussed in those disclosures, we believe that our compensation policies and decisions are focused on pay-for-performance principles and are stronglyaligned withour stockholders' interests. The compensation of our NEOs is designed to enable us to attractcurrent governance trends andretain talented and experienced executives to lead us successfully in a competitive environment. Accordingly, the Board is asking our stockholders to indicate their support for the compensation of our NEOs as disclosed in this Proxy Statement by casting a nonbinding advisory vote "FOR" the following resolution:"RESOLVED, that the compensation paid to our NEOs, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables, and narrative disclosure, is hereby APPROVED."The Compensation Committee continually reviews the Company's performance and governance highlights to evaluate whether the goals of the executive compensation and benefits program are supported and whether such program serves the interests of the Company's stockholders. The Company's 2017 performance and governance practicescontains stockholder-friendly features. These stockholder-friendly features include thefollowing, as discussed in more detail in the Compensation Discussion and Analysis section of this Proxy Statement:Performance Highlightsfollowing:Highlights of our 2017 business achievements included the following:•Full-year organic sales volumes of aggregates increased 3.4%.•Full-year organic sales volumes of cement increased 5.8%.•Full-year net income increased 331.2% to $121.83 million.•Full-year operating income increased 42.8% to $220.9 million.•Full-year adjusted EBITDA* increased 17.4% to $435.8 million.*See "Reconciliation of Non-GAAP Measure to GAAP" on Annex A.
Corporate Governance HighlightsWhat We Do (Best Practice) What We Don'tDon’t Do /Don'tDon’t Allow•Separate the roles of Chairman and Chief Executive Officer•
No hedging or pledging of Company stock by executives or directors•![[MISSING IMAGE: icon_blue-smtick20.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/icon_blue-smtick20.jpg)
Enforce strict insider trading,policies•No change-in-control severance multiple in excess of three times salaryanti-hedging andtarget bonus•anti-pledging policies
Set robust stock ownership guidelines for executives and directors•No excise tax gross-ups upon a change in control•Generally provideProvide provisions for recoupment("claw back"(“clawback”) of equity incentive compensation•No re-pricing orin our award agreements and adopted a policy for clawback of annual cashbuyout of underwater stock options•Disclose performance goals for incentive programs
•No enhanced retirement formulas•Set a maximum payout limit on our annual and long-term incentive programs for our NEOs•No guaranteed compensation•Incorporate double-trigger change-in-control provisions that are consistent with market practice•No market timing with granting of equity awards•Retain an independent compensation consultant that reports directly to the Human Capital and Compensation Committee•Eliminated substantially all perquisites for all NEOs in 2017•Perform an annual compensation program risk assessment to ensure that theCompany'sCompany’s compensation policies and practices are not reasonably likely to have a material adverse effect on the CompanyStrong alignment between pay and company performanceAnnual review of share utilization ![[MISSING IMAGE: icon_smblue-ex20.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/icon_smblue-ex20.jpg)
No change-in-control severance multiple in excess of three times salary and target bonusNo excise tax gross-ups upon a change in controlNo re-pricing or cash buyout of underwater stock optionsNo enhanced retirement formulasNo guaranteed compensationNo market timing with granting of equity awardsSubstantially no perquisites for our NEOsNo payment of dividends or dividend equivalents on unvested stock or unearned performance units Because the vote to approve the compensation of our NEOs is advisory, it is not binding on the Board or the Company. Nevertheless, the views expressed by our stockholders, whether through this vote or otherwise, are important to management and the Board and, accordingly, the Board and the Compensation Committee intend to consider the results of this vote in making determinations in the future regarding executive compensation arrangements. Nonbinding advisory approval of this proposal requires the vote of the holders of a majority of the voting power of the shares present in person or represented by proxy and entitled to vote on the matter at the Annual Meeting.THE BOARD RECOMMENDS A VOTE "FOR" THE APPROVAL, ON ANONBINDING ADVISORY BASIS,20 | SUMMIT MATERIALS2022 NOTICE OFTHE COMPENSATIONANNUAL MEETING AND PROXY STATEMENTTHIS PROXY STATEMENT. ITEM 2NONBINDING ADVISORY VOTE ON THE
COMPENSATION OF OUR NEOs Under the Dodd-Frank Wall Street Reform Consumer Protection Act (the “Dodd-Frank Act”) and Section 14A of the Exchange Act, our stockholders are entitled to vote to approve, on a nonbinding advisory basis, the compensation of our NEOs, as disclosed in this Proxy Statement in accordance with SEC rules. The compensation of our NEOs subject to the vote is disclosed in the Compensation Discussion and Analysis, the compensation tables, and the related narrative disclosure contained in this Proxy Statement. The compensation of our NEOs is designed to enable us to attract and retain talented and experienced executives to lead us successfully in a competitive environment, while ensuring that our executives remain incentivized to accomplish the Company’s long-term business plan. As discussed in this Proxy Statement, the vast majority of each NEO’s pay is at-risk and largely tied to challenging performance goals. We believe that our compensation policies and decisions are strongly aligned with our stockholders’ interests.The Board is asking our stockholders to indicate their support for the compensation of our NEOs as disclosed in this Proxy Statement by casting a nonbinding advisory vote “FOR” the following resolution:“RESOLVED, that the compensation paid to our NEOs, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables, and narrative disclosure, is hereby APPROVED.”Because the vote to approve the compensation of our NEOs is advisory, it is not binding on the Board or the Company. Nevertheless, the views expressed by our stockholders, whether through this vote or otherwise, are important to management and the Board and, accordingly, the Board and the Human Capital and Compensation Committee intend to consider the results of this vote in making determinations in the future regarding executive compensation arrangements, as a part of its robust compensation review and assessment process. Nonbinding advisory approval of this proposal requires the vote of the holders of a majority of the voting power of the shares present in person or represented by proxy and entitled to vote on the matter at the Annual Meeting. THE BOARD RECOMMENDS A VOTE “FOR” THE APPROVAL,
ON A NONBINDING ADVISORY BASIS, OF THE COMPENSATION
OF OUR NEOs, AS DISCLOSED IN THIS PROXY STATEMENT 2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 21
ITEM 3NONBINDING ADVISORY VOTE ON THE
FREQUENCY OF SOLICITATION OF
NONBINDING ADVISORY STOCKHOLDER
APPROVAL OF THE COMPENSATION OF
OUR NEOs The Dodd-Frank Act and Section 14A of the Exchange Act enable our stockholders, at least once every six years, to indicate their preference regarding how frequently we should solicit a nonbinding advisory vote on the compensation of our NEOs as disclosed in our proxy statement. Accordingly, we are asking our stockholders to indicate whether they would prefer a nonbinding advisory vote every year, every two years, or every three years. Alternatively, stockholders may abstain from casting a vote. After considering the benefits and consequences of each alternative, the Board recommends that the nonbinding advisory vote on the compensation of our NEOs be submitted to our stockholders once every year.The alternative among one year, two years, or three years (if any) that receives the votes of the holders of a majority of the voting power of the shares present in person or represented by proxy and entitled to vote on the matter at the Annual Meeting will be deemed to be the frequency preferred by our stockholders. While the Board believes that its recommendation is appropriate at this time, our stockholders are not voting to approve or disapprove that recommendation, but are instead being asked to indicate their preferences, on a nonbinding advisory basis, as to whether the nonbinding advisory vote on the approval of the compensation of our NEOs should be held every year, every two years, or every three years. The Board and the Human Capital and Compensation Committee value the opinions of our stockholders in this matter and, to the extent there is any significant vote in favor of one frequency over the other options, even if less than a majority, the Board will consider our stockholders’ concerns and evaluate any appropriate next steps. However, because this vote is advisory and, therefore, not binding on the Board of Directors or the Company, the Board may decide that it is in the best interests of our stockholders that we hold a nonbinding advisory vote on the compensation of our NEOs more or less frequently than the option preferred by our stockholders. The vote will not be construed to create or imply any change or addition to the fiduciary duties of the Compensation Committee, the Board, or the Company. THE BOARD RECOMMENDS A VOTE FOR “ONE YEAR” WITH RESPECT TO
HOW FREQUENTLY A NONBINDING ADVISORY VOTE ON THE COMPENSATION OF THE COMPANY’S NEOS SHOULD OCCUR 22 | SUMMIT MATERIALSCOMPENSATION COMMITTEE REPORT2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT Compensation Committee Report The Human Capital and Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management. Based on this review and discussion, the Human Capital and Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included (incorporated by reference) in the Company’s Annual Report on Form 10-K for the fiscal year ended January 1, 2022 and in this Proxy Statement. Submitted by the Human Capital and Compensation Committee of the Board. Steven H. Wunning, Chair
Anne M. Cooney
Tamla Oates-Forney
Howard L. Lance 2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 23Compensation Discussion andAnalysis with management. Based on this review and discussion, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included (incorporated by reference) in the Company's Annual Report on Form 10-K for the fiscal year ended December 30, 2017 and in this Proxy Statement.Submitted by the Compensation Committee of the Board.Neil P. Simpkins, ChairTed A. GardnerHoward L. LanceSteven H. WunningNamed Executive OfficersExecutive SummaryThe following Compensation Discussion and Analysis
("(“CD&A"&A”) describes our20172021 executive compensation structure, earned by or paid to the following named executive officers("NEOs"(“NEOs”).: Anne P. Noonan Thomas W. Hill President and Chief Executive Officer Michael J. BradyExecutive Vice President and Chief Business Development OfficerBrian J. Harris Executive Vice President and Chief Financial Officer M. Shane EvansKarli S. Anderson(1) Executive Vice President, Chief Environmental, Social & Governance Officer and West Division PresidentHead of Investor Relations Douglas C. RauhChristopher B. Gaskill(2) Former Executive Vice President, Chief Legal Officer and Secretary Deon MacMillan(3) Executive Vice President, Chief People Officer and Head of Corporate Communications (1)Ms. Anderson was promoted to Executive Vice President, Chief Environmental, Social & Governance Officer and Head of Investor Relations in March 2021.(2)Mr. Gaskill was promoted to Executive Vice President, Chief Legal Officer and Secretary in March 2021.(3)Ms. MacMillan joined the Company as its Executive Vice President, Chief People Officer and Head of Corporate Communications in March 2021.2021 Financial HighlightsThe Company launched its Elevate Summit strategy in March 2021. Elevate Summit has multiple aspects and horizons:•become the market leader in advantaged exurban & markets where we invest and grow for a #1 or #2 market position;•utilize asset light partnerships to maximize the pull through and reduce volatility in select markets while enhancing EBITDA margin and return on invested capital (“ROIC”);•become the most socially responsible integrated construction materials solution provider; and•develop innovative solutions to address tomorrow’s challenges.Within these key themes, we specifically targeted a reduction in leverage below 3X EBITDA, increase in margins and optimization of our portfolio.This allowed the Company to achieve the following in 2021:•Strong net revenue gains in our aggregates, ready-mix concrete, and cement lines of business.•Net revenue growth across all three reporting Segments, despite 8 divestitures during 2021, which resulted in cash proceeds received of $128 million.•Net income attributable to Summit of $152.2 million, adjusted cash gross profit of $673.3 million (a non-GAAP financial measure) of adjusted EBITDA of $520.1 million (a non-GAAP financial measure) and free cash flow of $161.6 million (a non-GAAP financial measure).•The Company focused on sustainable growth with investments in greenfields while advancing strategic divestitures that enhanced our market leadership.•The Company repaid $300 million of Senior Notes due 2025 using existing cash on hand.•Reduced our leverage ratio to 2.5X Net Debt to Adjusted EBITDA (a non-GAAP financial measure) at year end 2021, the lowest debt ratio in the Company’s history.*See “Reconciliation of Non-GAAP Measures to GAAP” on Annex A.24 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTCompensation Discussion and Analysis—What We PaidIn 2021, our executive compensation structure consisted of four primary components: base salary; annual cash incentives; long-term equity incentives and traditional health/welfare plans. We provide substantially no perquisites to our NEOs.2021 Compensation at a Glance Pay Element Description 2021 Payout / Changes Fixed Base Salary Fixed pay to recruit and retain executives Base salaries increased for our NEOs as follows: Ms. Noonan and Mr. Harris by 3%, which was our standard merit increase for corporate employees in 2021, consistent with competitive market practices, Ms. Anderson by 40%, and Mr. Gaskill by 28%.The base salary increases for Ms. Anderson and Mr. Gaskill reflected our standard merit increase and additional increases in connection with their promotions to Executive Vice President andChiefto reflect competitive market practices for similar roles and responsibilities. Ms. Anderson’s increase was approved in November 2021 and was retroactive as of March 29, 2021. Variable Annual Cash Bonus Annual cash incentives based on rigorous financial, operational and personal goals measured over one year:•50% Adjusted EBITDA•20% OperatingOfficerCash Flows•10% Safety•20% Personal Objectives For 2021, our NEO target Annual Cash Bonus opportunities were (i) the same as 2020 for Ms. Noonan and Mr. Harris and (ii) increased for Ms. Anderson and Mr. Gaskill in connection with their promotions to Executive Vice President and to reflect competitive market practice for their new roles.Each of our NEOs earned annual cash bonuses as set forth below in “Elements of Pay: Annual Cash Incentives—2021 Actual Performance and Payouts.” Long-Term Equity Incentives Annual long-term equity awards align executives’ interests with stockholders.50% Performance Units•Vest 50% based on three-year relative total shareholder return (“TSR”) compared to Materials and Capital Goods Companies (consisting of GICS industry groups 2010 and 1510) from the S&P 400 Midcap Index.•Capped at target if absolute TSR is negative.•Vest 50% based on the average three-year ROIC performance for three successive one-year periods.•Maximum payout is capped at 200% of target.•Grants are based in the Company’s Class A Common Stock. For 2021, our NEO target Long-Term Equity Incentive opportunities were (i) the same as 2020 for Ms. Noonan and Mr. Harris and (ii) increased for Ms. Anderson and Mr. Gaskill in connection with their promotions to Executive Vice President and to reflect competitive market practice for their new roles.For the performance period January 1, 2019 through December 31, 2021, our Relative TSR ranked at the 97th percentile, resulting in a payout equal to 200% of target.Return on invested capital (ROIC) was added to our program structure in 2020. We believe ROIC performance has a direct alignment with share price and stockholders’ interests. 50% RSUs•Vest ratably over 3 years.•Grants are based in the Company’s Class A Common Stock. Other Traditional Benefits Executive benefits are substantially similar to benefits offered to other employees. No change 2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 25Leadership ChangesIn October 2017, the Company announced that Douglas C. Rauh would leave his role as the Company's Executive Vice PresidentPay Mix andChief Operating Officer, effective December 30, 2017. In December 2017, the Company announced that Mr. Rauh entered into an Agreement and Release (the "Agreement and Release") dated December 15, 2017 with Summit Holdings and, solely for certain purposes specified therein, the Company, in connection with his departure from the Company. The terms of the Agreement and Release are described below under "Potential Payments Upon Termination or Change in Control." In January 2018, the Company announced that Karl H. Watson Jr. had been appointed Executive Vice President and Chief Operating Officer of the Company.Performance HighlightsHighlights of our 2017 business achievements included the following:•Full-year organic sales volumes of aggregates increased 3.4%.•Full-year organic sales volumes of cement increased 5.8%.•Full-year net income increased 331.2% to $121.83 million.•Full-year operating income increased 42.8% to $220.9 million.•Full-year adjusted EBITDA* increased 17.4% to $435.8 million.*See "Reconciliation of Non-GAAP Measure to GAAP" on Annex A.
Pay for PerformanceThe Human Capital and Compensation Committee
designsbelieves that a significant majority of both theexecutive compensation programChief Executive Officer’s and other NEOs’ pay should be at risk and not guaranteed. Compensation is tied todeliverchallenging performance objectives and this is illustrated in our payin accordance with corporate, segment, safety and individual performance.mix. A large percentage of total target compensation is at risk through long-term equity awards and annual cash incentive awards. These awards are linked to performance measures that correlate with long-term stockholder value creation. The amounts actually realized by our NEOs with respect to these awards depend on a variety of factors, including the level of attainment of the relevant performance goals and the extent of vesting of performance units and RSUs and the value of our stock when performance units and RSUs vest.The target values of long-term equity incentive awards used in the charts below differ from the compensation reported in the Summary Compensation Table due to the use of the grant date fair value in the Summary Compensation Table which is calculated in accordance with ASC 718, utilizing the assumptions discussed in our audited consolidated financial statements included in the 2021 Annual Report. The mix oftotal direct compensation at target for
20172021 for ourCEOChief Executive Officer and the average of our other NEOs is shown in the charts below.
Compensation Discussion and Analysis![[MISSING IMAGE: tm223385d2-pc_ceoneo4c.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/tm223385d2-pc_ceoneo4c.jpg)
2017 Executive Compensation StructureIn 2017, our executiveThe Human Capital and Compensation Committee approved the following compensationstructure consisted of four primary components: base salary;targets for 2021: Base Salary Annual Bonus Target as % of Base Salary Long-Term Incentive Target as % of Base Salary Anne P. Noonan $ 952,750 125% 305% Brian J. Harris $ 619,030 75% 155% Karli S. Anderson $ 375,000 60% 125% Christopher B. Gaskill $ 420,000 60% 125% Deon MacMillan $ 450,000 60%(1) 125%(2) (1)Pursuant to Ms. MacMillan’s offer letter, her target annual cashincentives; long-term equity incentives;bonus for 2021 was prorated for the period of time in which she was employed by the Company.(2)Pursuant to Ms. MacMillan’s offer letter, she received an initial award of RSUs promptly following her start date with a value of $450,000 (100% of base salary) that vest as follows: (i) $150,000 to vest on the grant date, (ii) $175,000 to vest on the first anniversary of the grant date, andtraditional health/welfare plans.We eliminated substantially all perquisites(iii) $125,000 to vest on the second anniversary of the grant date. Then, beginning in2017.
Table2022, her annual target award is expected to have a grant date fair value ofContents125% of her annual base salary.The Human Capital and Compensation Committee determines base salaries for the NEOs and other executives based on a number of factors, including but not limited to, the Human Capital and Compensation Committee’s understanding of executive pay practices, individual performance, Company performance and management recommendations (except with respect to the Chief Executive Officer).Base salaries increased for Ms. Noonan and Mr. Harris by 3%, which was our standard merit increase for corporate employees in 2021, Ms. Anderson by 40%, and Mr. Gaskill by 28%. The base salary increases for Ms. Anderson and Mr. Gaskill reflected our standard merit increase and additional increases in connection with their promotions to Executive Vice President. Ms. Anderson’s base salary increase was approved in November 2021 and was retroactive as of March 29, 2021. These base salaries reflect a thorough review of competitive market data, internal alignment of total compensation opportunity, and are consistent with competitive market data provided by the Independent Compensation Consultant.26 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT 2021 Target Base Salary 2020 to 2021 Increase Anne P. Noonan $ 952,750 3.0% Brian J. Harris $ 619,030 3.0% Karli S. Anderson $ 375,000 40%(1) Christopher B. Gaskill $ 420,000 28%(2) Deon MacMillan $ 450,000 NA(3) (1)Ms. Anderson was promoted to Executive Vice President, Chief Environmental, Social & Governance Officer and Head of Investor Relations in March 2021.(2)Mr. Gaskill was promoted to Executive Vice President, Chief Legal Officer and Secretary in March 2021.(3)Ms. MacMillan joined the Company as its Executive Vice President, Chief People Officer and Head of Corporate Communications in March 2021.Elements of Pay: Annual Cash Incentives2021 TARGET ANNUAL INCENTIVE AWARD OPPORTUNITIESAt the start of each fiscal year, the Board approves annual incentive compensation targets, as a percentage of target base salary, based on competitive market data provided by the Independent Compensation Consultant for our direct competitors and overall peer group, management’s recommendations and other relevant factors. The 2021 annual incentive targets, as a percentage of target base salary, for our NEOs were unchanged from 2020 (other than Ms. Anderson and Mr. Gaskill whose targets were increased in connection with their promotions and Ms. MacMillan whose first day of employment with the Company was in March 2021) as follows:Corporate Governance Highlights What We Do (Best Practice)What We Don't Do / Don't Allow•
Separate the roles of Chairman and Chief Executive OfficerTarget Bonus •
No hedging or pledging of Company stock by executives or directors•
Anne P. NoonanEnforce strict insider trading policies
125 •% Brian J. Harris 75 No change-in-control severance multiple% Karli S. Anderson 60% Christopher B. Gaskill 60% Deon MacMillan 60% (1)For 2021, Ms. MacMillan’s annual incentive award was prorated based on the number of days Ms. MacMillan was employed by the Company in 2021.2021 ANNUAL INCENTIVE METRICSThe metrics underlying our annual incentive were selected as the strongest indicators of our success. Adjusted EBITDA and operating cash flow are among our most important financial measures, while safety goals ensure that we focus on sustainable performance. Personal objectives measure progress against key milestones that are important to long-term value creation. The Board has discretion to adjust the target financial metrics to reflect, among other things, mergers, acquisitions, divestitures and other non-routine activity both inside and outside of management’s control during the fiscal year.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 27For 2021, performance metrics and weightings were as follows for our NEOs:Metric and Weighting Definition / Notes Adjusted EBITDA (50%) Net income (loss) before interest expense (income), income tax expense (benefit) and depreciation, depletion and amortization, adjusted to exclude accretion, loss on debt financings, transaction costs, non-cash compensation and certain other non-cash and non-operating items. Operating Cash Flow (20%) Annual cash flow in excess of three times salarycapital transactions andtarget bonusacquisitions. •Set stock ownership guidelines for executivesSafety (10%)(1)Recordable Incident Rate (RIR) Any employee work-related injury that requires medical treatment and directorsresults in a positive diagnosis of an injury, a prescription or work restrictions (per OSHA), divided by hours worked.•
No excise tax gross-ups upon a change in control•
Lost Time Incident Rate (LTIR)Generally provide provisions for recoupment ("claw back") of incentive compensation •
No re-pricing or cash buyout of underwater stock optionsSame as RIR but only includes injuries that result in at least one full day away from work. •
Preventable Incident Rate (PVIR)Disclose performance goals for incentive programs •
No enhanced retirement formulasThe number of preventable auto safety incidents, divided by miles driven. •SetCost Per Man Hour (CPMH) Based on the total incurred insurance-company-posted claim reserves on 12/31 of a maximum payout limit on our annualgiven year for all workers compensation, general liability andlong-term incentive programs for our NEOsauto liability claims divided by the hours worked in that same calendar year.•
No guaranteed compensation•
Personal Objectives (20%)Incorporate change-in-control provisions that are consistent with market practice •
No market timing with granting of equity awardsVaries by individual. See “Performance Targets and Payout Ranges—Personal Performance Goals.” (1)Safety metrics included various metrics related to the frequency and severity of reported incidents. For 2021, the safety metrics (and the weightings assigned to each safety metric for each NEO) included RIR (4% total award payout), LTIR (1.5% total award payout), PVIR (3% total award payout), and CPMH (1.5% total award payout).PERFORMANCE TARGETS AND PAYOUT RANGESThe achievement factor for each of the performance metrics was determined by multiplying the weight attributed to each performance metric by the applicable payout percentage for each metric. For corporate EBITDA and corporate cash flow payout percentages were determined by calculating actual achievement against the target amount based on a pre-established scale.Financial PerformanceFor corporate EBITDA and corporate operating cash flow, payout percentages for actual performance between the specified threshold, target, and maximum performance levels is interpolated on a straight-line basis. The following table shows the payout percentages associated with various levels of achievement of corporate EBITDA and operating cash flow: 2021 Payout Percentage 25% (Threshold) 100% (Target) 200% (Maximum) 2021 Corporate EBITDA
(Performance as a Percentage of Target) 90% 100% 110% 5% (Threshold) 100% (Target) 150% (Maximum) 2021 Corporate Operating Cash Flow
(Performance as a Percentage of Target) 90% 100% 110% Safety Performance TargetsThe overall safety metric achievement factor equals the sum of each metric’s payout percentage multiplied by its weighting. The maximum payout opportunities for the safety metrics is 150% of target. For the safety metrics, payout percentages for actual achievement between the specified threshold, target and maximum levels were adjusted on a linear basis. For the safety metrics below, the lower the result, the stronger the performance. All safety targets, other than CPMH, required year-over-year improvement in performance. 2021 Payout Percentage 0% (Threshold) 100% (Target) 150% (Maximum) RIR—40% Safety 1.32 1.15 0.95 LTIR—15% Safety 0.174 0.15 0.08 PVIR—30% Safety 1.06 0.98 0.88 CPMH—15% Safety 0.21 0.17 0.155 28 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTPersonal Performance GoalsPersonal performance goals may be focused on any combination of corporate, business-unit, or role-specific accomplishments or behaviors that focus executives on accomplishing our long-term business plan. The maximum payout under the Personal Performance Goal portion of the annual incentive is 200% of target.Anne P. NoonanMs. Noonan’s personal performance goals included defining a comprehensive multi-year strategic roadmap for the Company in order to clearly define the Company’s future. The roadmap was to focus on financial performance, optimizing the Company’s portfolio for sustainable growth, improving ESG performance and a creating a disciplined capital allocation that maximizes shareholder value. In addition, Ms. Noonan was to create a set of core values for the Company in order to increase employee engagement, accountability, sense of community, diversity and inclusivity. Further, Ms. Noonan was to recruit a chief people officer, establish an upgraded enterprise risk management process, develop an information technology roadmap, and increase the overall effectiveness of her position.Brian J. HarrisMr. Harris’s personal performance goals included completing a corporate strategic roadmap and creating strategic plans for the Company’s finance and information technology functions. In addition, Mr. Harris, in conjunction with Ms. Anderson, was to complete a new investor relations communication package, attend 10-15 investor conferences and 7-12 non-deal roadshows, and potentially an investor day. Further, Mr. Harris was to analyze and improve the Company’s capital structure, portfolio management, and finance department and perform benchmarking of finance and information technology functions against the Company’s peers.Karli S. AndersonMs. Anderson’s personal performance goals included developing and implementing a strategic roadmap to position the Company to lead its industry in social responsibility. Ms. Anderson was expected to quantify and deliver a SASB (Sustainability Accounting Standards Board) compliant baseline study encompassing social impact, land use and GhG emissions and to resource the function. She was also expected to improve ESG awareness and engagement throughout the business, evaluate current product initiatives, initiate strategic alliances and partnerships, and identify sustainable innovation opportunities to align with evolving customer and stakeholder needs.In addition, Ms. Anderson was to standardize the Environmental, Health and Safety function across the business with regard to goals, reporting, document retention and planning as well as to integrate the functions into a single technology platform and begin to drive a culture of zero harm throughout the business. Further, Ms. Anderson was to complete a new investor relations communication package, deliver an investment day that effectively communicated Summit’s strategy, solicit continuous feedback loop with investors, and, in conjunction with Mr. Harris, attend 10-15 investor conferences and 7-12 non-deal roadshows.Christopher B. GaskillMr. Gaskill’s personal performance goals included defining a comprehensive multi-year strategic roadmap for the Company in order to clearly define the Company’s future. In addition, Mr. Gaskill was to lead certain corporate governance objectives, including de-staggering the Company’s board, eliminating the supermajority voting requirement, reflecting ESG oversight responsibilities in the Company’s governance documents, and implementing an employee stock purchase plan. Further, Mr. Gaskill was to create a strategic roadmap for the legal department and to implement appropriate employee covenants to reduce the Company’s risk profile. Finally, Mr. Gaskill was to improve compliance training and procedures to support the Company’s core values and work to improve the legal department’s efficiencies.Deon MacMillanMs. MacMillan’s personal performance goals included creating a roadmap setting forth the Company’s human resources function. In addition, Ms. MacMillan was to create a request for proposal for the Company’s benefits programs. Further, Ms. MacMillan was to work with the legal department to implement appropriate employee covenants to reduce the Company’s risk profile.2021 ACTUAL PERFORMANCE AND PAYOUTSThe initial targets shown in the below table are based on the performance goals and funding scales approved in the first quarter of 2021. However, the targets for corporate EBITDA and corporate operating cash were modestly decreased and increased, respectively, to account for acquisitions and dispositions during the year. The actual results for the 2021 annual incentive plan were certified by the Human Capital and Compensation Committee as shown in the below table.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 29 Initial
Target Adjusted
Target Actual
Results(1) Payout
Percentage Weight Weighted
Payout
Percentage Corporate EBITDA ($ Millions) $ 518 $ 512.3 $ 516.8 107% 50% 53.5% Corporate Operating Cash Flow ($ Millions) $ 314 $ 315.1 $ 253.3 0% 20% 0% (1)See “Reconciliation of Non-GAAP Measures to GAAP” on Annex A.With respect to the corporate operating cash flow metric, which represented 20% of the total opportunity, the Human Capital and Compensation Committee conducted a qualitative evaluation of the performance of the NEOs. The Human Capital and Compensation Committee took note of an important factor that substantially affected corporate operating cash flow that was outside management’s control: adverse weather events and conditions across the Company’s geographic markets in October and November that led to delayed sales until December. Though operating cash flow had been substantially ahead of the budgeted target through the third quarter of 2021, the weather-related timing delays substantially affected collections timing within fiscal 2021, a key component of operating cash flow, and caused the full year result to be below the threshold level. Had the typical timing pattern of sales early in the fourth quarter of 2021 and collections within the quarter held, the change in net working capital would have been substantially higher and corporate operating cash flow would have exceeded target for 2021.The NEOs drove strong performance and improvement in working capital management, as evidenced by multiple metrics (e.g. working capital to revenue percentage). And the Company introduced its Elevate Summit strategy and began its implementation, including divestitures, which enabled debt paydowns and interest savings. These contributing factors led to a strong increase in the stock price. Taking all of these factors into account and giving due consideration to the NEOs’ strong performance in all phases within their control, the Human Capital and Compensation Committee determined to recognize achievement at the target level for this 20% metric.Corporate safety (10% weight): Overall performance was 50% of target, resulting in a weighted payout of 5% for each NEO.Financial and safety performance achievement for 2021 yielded an actual incentive earned of 78.5% of target for each NEO compared to the 80% weighted target. The remainder of each NEO’s 2021 actual incentive earned is based on Personal Performance Goal performance (20% weight). 2021 Base Salary Target Incentive as a
Percentage of Base Salary Actual Incentive Earned
as a Percentage of Base Salary Annual Cash
Incentive Earned Anne P. Noonan $ 952,750 125% 148% 1,411,299 Brian J. Harris $ 619,030 75% 79% 489,807 Karli S. Anderson $ 375,000 60% 63% 237,918 Christopher B. Gaskill $ 420,000 60% 67% 282,910 Deon MacMillan(1) $ 450,000 60% 48% 214,880 (1)For 2021, Ms. MacMillan’s annual cash incentive was prorated based on the number of days she was employed by the Company in 2021.Elements of Pay: Long-Term Equity IncentivesOur long-term equity incentives for NEOs in 2021 consisted of a balance of performance units (50%) and RSUs (50%). The Human Capital and Compensation Committee uses competitive market data from our annual total compensation study to assist with targeted long-term incentive value. In addition, the Human Capital and Compensation Committee considers individual performance, potential future contributions to our business, internal equity and management’s recommendations except in the case of the Chief Executive Officer.Award Type Weighting Vesting Value Tied To •PerformanceRetain an independent compensation consultant that reports directlyUnits 50% At the end of three years based 50% on relative TSR performance and 50% on ROIC performance Three-year TSR ranking compared to companies in the Compensation CommitteeS&P 400 Midcap Materials and Capital Goods Companies, and ROIC performance compared to targeted performance criteria•
Eliminated substantially all perquisites for all NEOs in 2017•Perform anRSUs 50% Vest over three years in equal annual compensation program risk assessment to ensure thatinstallments on each anniversary of theCompany's compensation policies and practices are not reasonably likely to have a material adverse effect on the Companygrant date Stock price performance Performance Units Granted in 2021The 2021 performance units focus our executives on the long-term performance of the Company relative to industry peers and predetermined financial targets. The performance metrics are weighted 50% on three-year relative TSR and 50% on the average of three one-year performance periods for return on invested capital (“ROIC”).30 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTThe peer group for determining our relative TSR is separate and distinct from the peer group used to evaluate and set NEO compensation levels discussed under “—Compensation Decision Process—Role of Peer Companies and Competitive Market Data.” The Relative TSR peer group represents a broader array (typically near 65 to 70 companies) of industry peers competing for stockholders and investors.ROIC is determined for the performance period by dividing (i) the arithmetic mean of the following for each fiscal year during the performance period: the Company’s Adjusted EBITDA (as reported on the Company’s audited financial statements) for each such fiscal year, reduced by depreciation, depletion and amortization charges for such fiscal year by (ii) the arithmetic mean of the following for each fiscal year during the performance period: the sum of the Company’s total outstanding long-term debt, stockholders’ equity, retained earnings and accumulated other comprehensive income, in each case, as reported on the Company’s audited financial statements for such fiscal year. The Compensation Committee believes that including ROIC as a performance metric incentivizes management to maximize efficiency of capital deployed for the benefit of the Company’s stockholders.The performance period for the performance units granted in March 2021 began on January 1, 2021 and ends on December 31, 2023 and are earned based on performance against the target below. Beginning in 2021, the performance units are measured using the average three-year performance against one-year ROIC goals. The changes to the design of the performance units were the result of the following:•The Company’s new leadership team embarking on a new strategy;•Allows realistic performance targets to be set when management and the committee have the most current information;•Allows stronger shareholder alignment with the most realistic ROIC stretch targets; and•Provides more realistic targets in a highly uncertain environment due to COVID-19 and economic forces;Earned amounts will be interpolated on a straight line basis for performance between threshold, target, and maximum performance requirements. Financial goals are established based on a review of historical and strategic forward-looking performance criteria and are established at reasonable but stretch performance requirements for threshold, target, and maximum payout opportunities. We will proactively disclose the ROIC performance requirements and performance attainment at the completion of the three-year performance period.Threshold and maximum performance levels for relative TSR and ROIC earn payments of 50% of target and 200% of target, respectively. The following chart summarizes relative three-year TSR performance requirements. TSR Level of Achievement Below Threshold Threshold Target Maximum Cap (if applicable) Relative TSR Position < 25th percentile 25th percentile 50th percentile 75th percentile Capped at 100% if Company TSR
is negative over performance
period, regardless of ranking Achievement Percentage 0% 50% of target 100% target 200% of target See “—Treatment of Long-Term Incentive Awards Upon Termination or Change in Control” for a description of the potential vesting of the NEOs’ equity awards that may occur in connection with certain termination events and a change in control.For 2021, the Human Capital and Compensation Committee set the target pay levels and made the grants set forth in the table below. 2021 Target Long-Term
Incentive as % of Base Salary 2021 Target Long-Term
Incentive(1) Performance Units
Granted (#) Restricted Stock Units
Granted (#) Anne P. Noonan 305% $ 2,905,888 50,838 50,838 Brian J. Harris 155% $ 959,497 16,786 16,786 Karli S. Anderson 125% $ 468,750 7,107 7,107 Christopher B. Gaskill 125% $ 525,000 9,185 9,185 Deon MacMillan(2) 100% $ 450,000 — 14,926 (1)The target award values shown vary from the values listed in the 2021 Grants of Plan-Based Awards Table for two reasons. First, the 2021 Grants of Plan-Based Awards Table uses the Monte Carlo valuation method, which determines the accounting expense for our performance units because 50% is based on Relative TSR. This generated an expense value approximately 160% higher than the actual value on the grant date for the awards issued on March 30, 2021 to each of our NEOs (other than Ms. MacMillan), and an expense value approximately 160% higher than the actual value on the grant date for the awards issued on March 10, 2021 to Ms. MacMillan. However, we do not believe the Monte Carlo accounting model is appropriate for purposes of setting total compensation opportunity. Second, to mitigate the potential impact of short-term stock price swings on our equity grants, we use the 20-day average closing stock price immediately preceding the grant date to determine the grant size, rather than the closing stock price on the actual grant date as shown in the 2021 Grants of Plan-Based Awards Table.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 31(2)Pursuant to Ms. MacMillan’s offer letter, she received an initial equity award of RSUs having a value of $450,000.Performance Units Earned for the Performance Period 2019—2021Performance units were granted to our NEOs then employed by the Company that were subject to Relative TSR performance for the three-year performance period beginning January 1, 2019 and ending December 31, 2021. The Relative TSR peer group was companies in the S&P 400 Midcap Materials and Capital Goods companies (67 companies at the start of the performance period). Relative TSR performance was based on dividends plus beginning and ending stock prices based on the trailing 20-day average closing price. During the performance period, our Relative TSR ranked at the 97th percentile, resulting in a payout equal to 200% of target.Performance Units Achievement for the First Year of the Performance Period 2021—2023Performance units were granted to our NEOs then employed by the Company that were subject to Relative TSR and ROIC performance for the three-year performance period beginning January 1, 2021 and ending December 31, 2023. The Relative TSR peer group was companies in the S&P 400 Midcap Materials and Capital Goods companies. Relative TSR performance was based on dividends plus beginning and ending stock prices based on the trailing 20-day average closing price. During the first year of the performance period, our Relative TSR ranked at the 77th percentile and our ROIC exceeded our target performance criteria.Retirement, Perquisites, and Other BenefitsWe have a tax-qualified contributory retirement plan established to qualify as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code of 1986, as amended (the “Code”). The plan covers all U.S. employees, including our NEOs, who are limited to their annual tax deferred contribution limit as allowed by the Internal Revenue Service (the “IRS”). We provide for matching contributions to the plan, including 100% of pre-tax employee contributions, up to 4% of eligible compensation. Employer contributions vest immediately.The Company also offers the members of a select group of management or highly compensated employees, including the NEOs, the opportunity to supplement their retirement savings through the Summit Materials Deferred Compensation Plan (the “DCP”). An eligible participant in the DCP may elect to defer up to 50% of such participant’s base salary compensation and up to 100% of such participant’s designated discretionary bonus award compensation and annual incentive award compensation. The DCP also permits Company-provided credits to participants’ accounts, but no such credits are currently being made. Additional information about the DCP is reflected in “—2021 Non-Qualified Deferred Compensation” below.In alignment with a health and safety culture, the Company offers an Executive Health Program through the Mayo Clinic for the CEO and the executive team, including all the NEOs. The Human Capital and Compensation Committee approved this program in the Fall of 2021 and the use of this benefit is voluntary and not all executives will utilize it annually. The value of the program will not exceed $10,000 annually for each eligible executive.32 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTCompensation Discussion and Analysis—How We PaidOur Compensation PhilosophyOur executive compensation program is intended to attract, motivate and retain executive officers and to align the interests of our executive officers with
stockholders'stockholders’ interests.TheBoard'sBoard’s objectives for our program include, but are not limited to, the following:![[MISSING IMAGE: tm123_chrt-cda.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/tm123_chrt-cda.jpg)
Say-on-Pay Votes
Components of 2017 Target CompensationPay ComponentPurposeCharacteristicsFixed orPerformanceBase SalaryAttractIn 2021, the Human Capital andretain executives through market-based payReflects the executive's experience and performance and the Board's knowledge of market practicesFixedAnnual Cash BonusEncourages achievement of strategic and financial performance metrics that drive long-term stockholder valueBased on achievement of predefined financial, non-financial (e.g. safety) and individual performance objectivesPerformanceLong-Term Equity IncentivesAligns executives' long-term compensation with stockholders' investment interests; enhances executive retentionValue to the executive is based on long-term stock price performance and value creationPerformanceHealth/Welfare Plans and Retirement BenefitsProvide competitive benefits that promote employee health and productivity and support longer term financial securitySimilar to benefits offered to other employeesFixed2017 Target Compensation ElementsThe Compensation Committee approved the following compensation targets for 2017: Base Salary Annual Bonus Target
as % of Base Salary Long-Term Incentive
Target as % of Base
Salary Thomas W. Hill
$ 826,956 140 % 275 % Michael J. Brady
425,000 60 % 100 % Brian J. Harris
550,000 75 % 155 % M. Shane Evans
420,787 60 % 100 % Douglas C. Rauh
550,000 75 % 155 % Say-on-Pay VotesIn 2017, theCompensation Committee considered the outcome of the stockholder advisory vote on20162020 executive compensation when making decisions relating to the compensation of our NEOs and our executive compensation program and policies. Our stockholders voted at our20172021 annual meeting, in a nonbinding advisory vote, on the20162020 compensation paid to our NEOs. Our stockholders overwhelmingly(96%(98%) approved the compensation of our NEOs. Based on the level of support, the Human Capital and Compensation Committee determined that stockholders generally support our compensation practices. The Company has determined to hold this advisory, say-on-pay vote annually, consistent with the stated preferences of our stockholders and with the results of our 2016 Annual Meeting of Stockholders where the majority of the votes cast were in favor of an annual advisory vote.In addition, the Company continued its efforts to reach out to investors for feedback in 2021. During the year, the Company’s investor relations and legal departments contacted many of the Company’s largest investors and engaged in conversations with a significant portion of the investor base. The feedback received in these conversations was generally positive in regard to the Company’s compensation programs. The Human Capital and Compensation Committee intends to continue to consider the views of our stockholders when designing, reviewing and administering theCompany'sCompany’s compensation programs and policies.
Compensation Decision ProcessCompensation Decision Process Role of the Human Capital and Compensation Committee 
The Human Capital and Compensation Committee is responsible to our Board for oversight of our executive compensation program. The Human Capital and Compensation Committee is responsible for the review and approval of all aspects of our program.Among its duties, the Human Capital and Compensation Committee is responsible for:•Assessing competitive market data fromAon, our independent compensation consultant (the "Independentthe Independent CompensationConsultant")Consultant
•Reviewing eachNEO'sNEO’s performance in conjunction with competitive market data and, accordingly, approving compensation recommendations including, but not limited to, base salary, annual bonus, long-term incentives, and benefits/perquisites•Considering, recommending and approving incentive plan goals,andachievement levels,and program structure
•Incorporating meaningful input from our stockholders, if applicable 2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 33 Role of Management himself,herself, ourCEOChief Executive Officer recommends to the Human Capital and Compensation Committee compensation levels for NEOs based on a review of market data and individual performance. The Human Capital and Compensation Committee reviews and discusses all recommendations prior to approval, then submits all recommendations to the Board for approval.For theCEO,Chief Executive Officer, during executive session without theCEOChief Executive Officer present, the Human Capital and Compensation Committee is solely responsible for assessing performance and making compensation recommendations to the Board for approval. Management does not make compensation-related recommendations for theCEO.Chief Executive Officer. Role of the Independent Compensation Consultant 2017,2021, the Human Capital and Compensation Committee retained the Independent Compensation Consultant in accordance with the Human Capital and CompensationCommittee'sCommittee’s charter. The Independent Compensation Consultant reports directly to the Human Capital and Compensation Committee. The Human Capital and Compensation Committee retains sole authority to hire or terminate the Independent Compensation Consultant, approve its fees, determine the nature and scope of services and evaluate the Independent CompensationConsultant'sConsultant’s performance.A representative of the Independent Compensation Consultant attends Human Capital and Compensation Committee meetings, as requested, and communicates with the Human Capital and Compensation Committee chair between meetings. The Human Capital and Compensation Committee makes all final decisions and recommendations.The Independent CompensationConsultant'sConsultant’s roles include, but are not limited to, the following:•Advising the Human Capital and Compensation Committee on executive compensation trends and regulatory developments;•Developing a peer group of companies for determining competitive compensation amounts and practices;•Providing a total compensation study for executives against peer companies;•Providing advice to the Human Capital and Compensation Committee on governance best practices, as well as any other areas of concern or risk; and•Reviewing and commenting on proxy disclosure items, including the CD&A.The Human Capital and Compensation Committee has assessed the independence of the Independent Compensation Consultant, considering all relevant factors, including those set forth in Rule 10C-1(b)(4)(i) through (vi) under theSecuritiesExchangeAct of 1934, as amended.Act. Based on this review, the Human Capital and Compensation Committee concluded that there are no conflicts of interest raised by the work performed by the Independent Compensation Consultant and thatAonthe Independent Compensation Consultant is independent. Role of Peer Companies and Competitive Market Data 2016,2020, to assist with20172021 compensation decisions, the Independent Compensation Consultant performed a competitive pay study. To develop competitive market values for the NEOs, the Independent Compensation Consultant developed, and the Human Capital and Compensation Committee approved, a peer group of17 companies.16 companies, which were the same companies used in the prior year. The peer group development criteria included:•Industry: Companies in the building products,orconstruction materials, forest products, and mining industries•Company size: Approximately 0.4x to 3x times our annual revenues (primary factor), with market capitalization reviewed as a secondary factor•ISS: Companies considered by Institutional Shareholder Services("ISS"(“ISS”) to be theCompany'sCompany’s compensation peers and used inISS'ISS’ annual report regarding the Company•Peers of Peers: Companies used in the peer groups of potential peer companies•Competitors:Companies that compete with us for business and management talent•Consistency: Companies contained in the peer group in the prior year
The approved peer group had annual revenues which ranged from approximately$600$894 million to$3.8$4.9 billion, with average / median annual revenue of approximately$1.9$2.4 billion andaverage$1.8 billion, respectively. For our Fall 2020 total compensation study, our annualrevenue ofrevenues were estimated at approximately$2.0 billion. Our 2016 annual revenue was approximately $1.6$2.3 billion. The Independent Compensation Consultant developedsize-adjustedsize adjusted market values (regression analysis) for each position using our annual revenue. 34 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT
Thesize-adjusted50th percentile for total compensation is a key reference point for the Human Capital and CompensationCommittee.Committee; however, the Human Capital and Compensation Committee also considers other factors, including, experience, performance and expected future contributions. For positions where peer company proxy data was not available, the Independent Compensation Consultant utilized published and private compensation survey sources. PEER GROUP Peer Group•
Armstrong World Industries, Inc.••Boise Cascade Company••Compass Minerals International, Inc.••CONSOL Energy Inc.•Cornerstone Building Brands, Inc.•Dycom Industries, Inc. ••Eagle Materials Inc.•Gibraltar Industries, Inc.•Granite Construction Inc.••Headwaters Inc.•Louisiana-Pacific Corp.•Martin Marietta Materials, Inc.••Masonite International Corporation ••NCI building Systems Inc.•Quanex Building Products Corp.••Simpson Manufacturing Company••US Concrete Inc.••USG Corp.•Vulcan Materials Company TIMING OF COMPENSATION DECISIONSTiming of Compensation DecisionsPay recommendations for our executives, including the NEOs, are typically made by the Human Capital and Compensation Committee at its first scheduled meeting of the fiscal year, typically held in February around the same time we report our fourth quarter and year-end financial results for the preceding fiscal year and provide our financial guidance for the upcoming year (the
"February meeting"“first meeting”). This timing allows the Human Capital and Compensation Committee to have a complete financial performance picture prior to making compensation decisions.Decisions with respect to prior year performance, as well as annual equity awards, base salary increases and target performance levels for the current year are typically made at theFebruaryfirst meeting. Any equity awards recommended by the Human Capital and Compensation Committee at this meeting are reviewed by the Board and, if approved, are dated on the dateofapproved by the Board either at a subsequent board meetingheld later that dayorthe following day.via written consent. As such, the Human Capital and Compensation Committee does not time the grants of equity incentives to the release of material non-public information.Theexercise price of stock options is the closing price of our common stock on the date of grant.The exception isexceptions are grants to executives who are promoted or hired from outside the Company during theyear.year, and discretionary grants made throughout the year for retention and extraordinary purposes. These executives may receive compensation changes or equity grants effective or dated, as applicable, as of the date of their promotion, hiring date, or other Board approval date.DETERMINATION OF CHIEF EXECUTIVE OFFICER COMPENSATIONDetermination of CEO CompensationAt the
Februaryfirst meeting of each fiscal year, in executive session without theCEOChief Executive Officer present, the Human Capital and Compensation Committee also reviews and evaluatesCEOChief Executive Officer performance, and determines performance achievement levels, for the prior fiscal year. The Human Capital and Compensation Committee also reviews competitive compensation data from the peer group companies. The Human Capital and Compensation Committee typically approves, or presents, pay recommendations for theCEOChief Executive Officer to the Board, excluding theCEO,Chief Executive Officer, for approval. If applicable, during executive session, the Board conducts its own review and evaluation of theCEO'sChief Executive Officer’s performance taking into consideration the recommendations of the Human Capital and Compensation Committee.Compensation ElementsBase SalaryAnnual base salaries compensate our executive officers for fulfilling the requirements of their respective positions and provide them with a level of cash income predictability and stability with respect to a portion of their total compensation. The Compensation Committee determines base salaries for the NEOs and other executives based on a number of factors, including but not limited to, the Compensation Committee's understanding of executive pay practices, individual performance, Company performance and management recommendations (except with respect to the CEO).For 2017, based on a thorough review of competitive market data and internal alignment of total compensation opportunity, the Compensation Committee set the base salaries set forth in the table below. Mr. Brady's adjustment moved his salary closer to similar NEOs at peer companies. The 2017 base salaries for Messrs. Hill, Harris, Evans, and Rauh also reflect a one-time salary adjustment that was provided inconnection with the elimination of substantially all perquisites in 2017. Mr. Brady did not previously receive significant perquisites.EQUITY PLAN2017 Base Salary 2016 to 2017 Increase Thomas W. Hill
$ 826,956 3% Michael J. Brady
425,000 11% Brian J. Harris
550,000 6% M. Shane Evans
420,787 5% Douglas C. Rauh
550,000 6% Annual Cash IncentivesEach NEO was eligible to earn an annual incentive under our Short-Term Incentive Plan (the "STIP") based upon the achievement of performance targets approved by the Board at the February meeting.2017 Target Annual Incentive Award Opportunities. At the start of each fiscal year, the Board approves annual incentive compensation targets, as a percentage of base salary, based on the understanding of the Board of competitive executive pay practices, management's recommendations and other relevant factors. The 2017 annual incentive targets, as a percentage of base salary, for our NEOs were consistent with our 2016 targets and were as follows:Target BonusThomas W. Hill140%Michael J. Brady60%Brian J. Harris75%M. Shane Evans60%Douglas C. Rauh75%2017 Annual Incentive Metrics. For corporate NEOs (Messrs. Hill, Brady, Harris and Rauh), the performance metrics approved for fiscal 2017 were (i) corporate earnings before interest, taxes, depreciation, depletion and amortization ("EBITDA"), as defined by the Board, which is defined as EBITDA, as adjusted to exclude accretion, loss on debt financings, tax receivable agreement expense, income from discontinued operations and certain non-cash and non-operating items plus the EBITDA contribution of certain recent acquisitions, (ii) operating cash flow, which approximates annual cash flow exceeding capital transactions and acquisitions, (iii) safety metrics, and (iv) personal objectives, which vary by individual. Mr. Brady was also subject to acquisition related metrics, including acquisition spend and acquisition EBITDA performance. For Mr. Evans, the approved performance metrics included (i) corporate EBITDA, (ii) segment EBITDA, (iii) segment cash flow, (iv) segment safety and (v) personal objectives. The Board has discretion to adjust the financial metrics to reflect merger, acquisition or divestiture activity during the fiscal year. In 2017, as further discussed below, the metrics were adjusted to reflect acquisitions completed during the year and the financial impact of Hurricane Harvey on the Company's operations.For 2017, performance metrics and weightings were as follows:EBITDA Operating
Cash FlowSafety/
Acquisition (2)Personal
ObjectivesPrimary Personal Objectives Thomas W. Hill
50% 20% 10% 20% •
Deliver on or over budget operations improvement
•
Progress on developing a ready-mix concrete performance team
•
Achieve minimum acquisition spend and acquisition performance
•
Improve investor relations function
•
Progress on management succession planning
Michael J. Brady
50% 10% 20% 20% •
Achieve minimum acquisition spend
•
Achieve performance levels for 2016 and 2017 acquisitions consistent with investment thesis
•
Continue to build the Development team
•
Drive senior leadership team involvement
Brian J. Harris
50% 20% 10% 20% •
Increase interactions with Board members
•
Continue to develop a robust investor relations function
•
Provide overall direction to the information technology group
•
Evaluate the possibility of using a balanced scorecard approach to achieve greater alignment in strategic execution
•
Increase engagement with operating companies
M. Shane Evans(1)
60% 20% 10% 10% •
Continue to drive pricing, cost reduction, sales and sourcing achievements above and beyond 2017 budget
•
Evaluate vehicle allowance programs
•
Hold quarterly Texas managers meetings
Douglas C. Rauh
50% 20% 10% 20% •
Assist in finding a new Chief Operating Officer
•
Deliver on budget EBITDA and free cash flow targets
•
Facilitate talent management process at operating companies
•
Continue to drive pricing, cost reduction and sourcing achievements above and beyond 2017 budget
•
Continue to drive safety performance
•
Work with M. Shane Evans on performance at Company's Austin business
•
Drive the implementation of total productive maintenance throughout the Company
(1)Mr. Evans's EBITDA metric is based 20% on Corporate EBITDA and 40% on West Segment EBITDA. Mr. Evan's Operating Cash Flow metric is based on West Segment Operating Cash Flow.(2)Each of our NEOs had safety metrics for 2017. For each of our NEOs, the safety metrics accounted for 10% of the overall bonus opportunity. Safety metrics included various metrics related to the frequency and severity of reported incidents. For 2017, the safety metrics (and the weightings assigned to each safety metric for each NEO) included recordable incident rate (4%), lost time incident rate (2%), fleet preventable incident rate (2%) and cost per man hour (2%). For Mr. Evans, the safety metrics related to the West segment. Mr. Brady was also subject to acquisition metrics, which accounted for 10% of his overall bonus opportunity (5% attributable to acquisition spend and 5% attributable to acquisition EBITDA performance).
Performance / Payout Percentage.The achievement factor for each of the performance metrics was determined by multiplying the weight attributed to each performance metric by the applicable payout percentage for each metric. For corporate EBITDA and operating cash flow, payout percentages were determined by calculating actual achievement against the target amount based on a pre-established scale.Payout percentages for actual performance between the specified threshold levels and 105% of target, and between 105% of target and the maximum levels, were adjusted on a linear basis. The following table shows the payout percentages associated with various levels of achievement of corporate EBITDA: Payout Percentage 25% (Threshold) 100% (Target) 138% 200% (Maximum) Corporate EBITDA (Percentage of Target) 90% 100% 105% 110% The following table shows the payout percentages associated with various levels of achievement of corporate operating cash flow: Payout Percentage 0% (Threshold) 100% (Target) 125% 150% (Maximum) Corporate Operating Cash Flow (Percentage of Target) 90% 100% 105% 110% For Mr. Evans, Segment EBITDA and Segment Cash Flow payout percentages were determined by calculating actual achievement against the target amount based on a pre-established scale. Payout percentages for actual performance between the specified threshold, target and maximum levels were adjusted on a linear basis. The following table shows the payout percentages associated with threshold, target and maximum achievement of Segment EBITDA and Segment Cash Flow: Payout Percentage 25% (Threshold) 100% (Target) 200% (Maximum) Segment EBITDA and Segment Cash Flow (Percentage of Target) 85% 100% 120% The maximum payout opportunities for the safety metrics and personal objectives were 150% of target. For the safety metrics, payout percentages for actual achievement between the specified threshold, target and maximum levels were adjusted on a linear basis. The overall safety metric achievement factor equals the sum of each metric's payout percentage multiplied by its weighting.For Mr. Brady, acquisition spend and acquisition EBITDA performance were determined by calculating actual achievement against the target amount based on a pre-established scale. The maximum payout opportunities for the acquisition metrics were 150% of target for actual achievement at 110% of target.2017 Actual Performance.Actual results for the 2017 annual incentive plan were certified by the Compensation Committee, as follows, based on the performance goals and funding scales approved in the first quarter of 2017: Initial Target Adjusted
Target to
Account for
2017
Acquisitions
and Hurricane
Harvey(1) Actual Results Payout
Percentage Weighted Achievement
FactorCorporate EBITDA
$ 416.3 million $ 457.1 million $ 457.1 million 100% 50% (Messrs. Hill, Brady,
Harris and Rauh) 20% (Mr. Evans) Corporate Operating Cash Flow
230.5 million 217.2 million 225.4 million 119% 23.8% (Messrs. Hill,
Harris and Rauh) 11.9% (Mr. Brady) West Segment EBITDA
182.5 million 211.5 million 223.2 million 127% 50.8% West Segment Cash Flow
101.4 million 101.4 million 123.9 million 200% 40% (1)During 2017, Hurricane Harvey adversely affected our operations not only during the days immediately before and after the storm, but also in the weeks and months after as our customers recovered and reallocated resources in response to damage caused by the storm. As a result, the Compensation Committee determined to adjust certain performance metrics. The following table summarizes the effects of these adjustments on the applicable payout percentages:
Payout
Percentage Without Hurricane
Harvey AdjustmentPayout
Percentage With Hurricane
Harvey AdjustmentCorporate EBITDA
93% 100%(1) Corporate Operating Cash Flow
109% 119% West Segment EBITDA
110% 127% West Segment Cash Flow
170% 200% (1)Mr. Evans' Corporate EBITDA metric was not adjusted for Hurricane Harvey.
The payout percentages for the safety metrics were as follows: corporate safety was 124% of target, resulting in an achievement factor of 12.4% for each NEO other than Mr. Evans; and West Segment safety for Mr. Evans was 72% of target, resulting in an achievement factor of 7.2%. Each of the safety metric targets were set at a challenging level that are consistent with our long-term goals and designed to meet high stockholder expectations.Actual annual cash incentive awards are calculated by multiplying each NEO's actual base salary by his target award potential, which was then adjusted by an overall achievement factor based on the combined weighted achievement of the components described above, including an evaluation of eachNEO's personal objectives. The following table summarizes the 2017 bonuses earned based on actual performance, as compared to the target opportunity for each NEO: 2017 Base Salary Target
Incentive Overall Achievement Factor as
a Percent of Target Award Annual Cash
Incentive
Earned Thomas W. Hill
$ 826,956 $ 1,157,739 110 % $ 1,275,480 Michael J. Brady
425,000 255,000 111 % 283,764 Brian J. Harris
550,000 412,500 109 % 450,326 M. Shane Evans
420,787 252,472 128 % 323,669 Douglas C. Rauh
550,000 412,500 106 % 437,951 Long-Term IncentivesOn-Going Post-IPO Long-Term IncentivesThe Company maintains the
Summit Materials, Inc. 2015Omnibus Incentive Plan(the "Omnibus Incentive Plan")which allows for grants of equity-based awards in the form of stock options, stock appreciation rights, restricted stock andrestricted stock units ("RSUs"),RSUs, performance units, undivided fractional limited partnership interests in Summit Holdings and other stock-based awards.In 2015, theGovernance of Executive CompensationCommittee determined that the size, structure, and value of the pre-IPO grants were sufficient for 2015 and no additional equity grants were made in 2015 in connection with, or after, our IPO.In 2016, the Compensation Committee worked with the Independent Compensation Consultant to develop a competitive long-term incentive grant structure as an on-going public company. The Compensation Committee believes in a balanced approach to long-term incentive compensation, with an emphasis on performance-based compensation. The Compensation Committee determined that a similar structure in 2017 was appropriate.Our regular ongoing equity incentives for NEOs in 2017 consisted of a balance of performance units (34%), RSUs (33%) and stock options (33%). In 2018, the Committee determined to eliminate stock options from regular ongoing equity incentive grants. Accordingly, our regular ongoing equity incentives for NEOs in 2018 consisted of a balance of performance units (50%) and RSUs (50%). The Committee uses competitive market data from our annual total compensation study to assist with targeted long-term incentive value. In addition, the Committee considers individual performance, potential future contributions to our business, internal equity and management's recommendations.Award TypeWeightingVestingValue Tied ToPerformance Units1/3 of total awardVest at the end of a 3-year period in an amount based on the level of performance achievedCompany three year total shareholder return ("TSR") ranking to the companies that formerly comprised the S&P Building & Construction Select Industry Index , which index was discontinued in 2017; see the section entitled "2018 Enhancements to Our On-Going Long-Term Incentive Structure" for a broader discussionRSUs1/3 of total awardVest over 3 years in equal annual installments on each anniversary of the grant dateStock price performanceStock Options1/3 of total awardVest over 3 years in equal annual installments on each anniversary of the grant dateStock price appreciationPerformance UnitsThe 2017 performance units focus our executives on the long-term performance of the Company relative to industry peers. The 2017 performance units vest at the end of a three-year performance period, based on our TSR ranking relative to companies that formerly comprised the S&P Building & Construction Select Industry Index ("Relative TSR"), which index was discontinued in 2017, using beginning and ending stock prices based on the trailing 20-day average closing price. The Compensation Committee determined that Relative TSR ranking against an industry index aligns management with stockholder value creation and provides incentive to achieve the Company's long-term strategy.The performance period for the performance units granted in February 2017 began on January 1, 2017 and ends on December 31, 2019. Following the completion of the three-year performance period, the Compensation Committee will determine earned amounts based on our Relative TSR ranking versus the companies that formerly comprised the S&P Building & Construction Select Industry Index. This peer group is separate and distinct from the peer group used to evaluate and set NEO compensation levels discussed under "—Compensation Decision Process—Role of Peer Companies and Competitive Market Data." The Relative TSR peer group represents a broader array (approximately 130 companies) of industry peers competing for stockholders and investors and avoids subjectivity as it was independently constructed by Standard & Poor's.The 2017 grants will be earned based on the schedule below. Earned amounts will be interpolated on a straight-line basis for performance between the stated percentiles.STOCK OWNERSHIP GUIDELINESLevel of AchievementBelow ThresholdThresholdTargetMaximumCap (if applicable)Relative TSR PositionAchievement Percentage< 30thpercentile0%30thpercentile50% of target50thpercentile100% target75thpercentile200% of targetCapped at 100% if Company TSR is negative over performance period, regardless of rankingSee "—Potential Payments Upon Termination or Change in Control" for a description of the potential vesting of the NEOs' equity awards that may occur in connection with certain termination events and a change in control.For 2017, the Compensation Committee set the target pay levels and made the grants set forth in the table below. 2017 Target
Long-Term Incentive
as % of Base
Salary 2017 Target Long-
Term Incentive Performance
Units Granted Restricted Stock
Units Granted Stock Options
Granted Thomas W. Hill
275% $ 2,274,129 31,689 30,757 51,261 Michael J. Brady
100% 425,000 5,922 5,748 9,580 Brian J. Harris
155% 852,500 11,879 11,530 19,216 M. Shane Evans
100% 420,787 5,863 5,691 9,485 Douglas C. Rauh
155% 852,500 11,879 11,530 19,216 2018 Enhancements to Our On-Going Long-Term Incentive StructureDuring 2017, the Compensation Committee worked closely with our Independent Compensation Consultant to enhance our long-term incentive structure for our executive officers. The following modifications were approved for the 2018 grant cycle:•Relative TSR peer group for performance units: The S&P Building & Construction Select Industry Index was discontinued in 2017. Outstanding grants will continue to use the companies comprising that index. For the 2018 grant cycle, the Committee approved a new Relative TSR peer group defined as the Materials and Capital Goods companies (consisting of companies in GICS industry groups 2010 and 1510—, which is the same as the previous peer group), from the S&P 400 Midcap Index. The new Relative TSR peer group consists of approximately 68 companies with similar revenues and market capitalization as the Company.•Eliminated stock options and increased the weight of performance units and RSUs: The Committee approved the elimination of stock options and increased the weight on performance units and RSUs. The new approach beginning with 2018 equity grants will be 50% performance units and 50% RSUs.
Retirement, Perquisites and Other BenefitsWe have a tax-qualified contributory retirement plan established to qualify as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code of 1986, as amended (the "Code"). The plan covers all U.S. employees, including our NEOs, who are limited to their annual tax deferred contribution limit as allowed by the Internal Revenue Service (the "IRS"). We provide for matching contributions to the plan, including 100% of pre-tax employee contributions, up to 4% of eligible compensation. Employer contributions vest immediately.The Company also offers the members of a select group of management or highly compensated employees, including the NEOs, the opportunity to supplement their retirement savings through the Summit Materials Deferred Compensation Plan (the "DCP"). An eligible participant in the DCP may elect to defer up to 50% of such participant's base salary compensation and up to 100% of such participant's designated discretionary bonus award compensation and annual incentive award compensation. The DCP also permits Company-provided credits to participants' accounts, but no such credits are currently beingmade. Additional information about the DCP is reflected in "—2017 Non-Qualified Deferred Compensation" below.Beginning in 2017, we eliminated substantially all perquisites to our NEOs and senior executives. A one-time salary adjustment was provided to offset the changes.Change in Control and Severance ArrangementsOn December 15, 2017, the Board, on the recommendation of the Compensation Committee, approved an Executive Severance Plan (the "Severance Plan") in order to standardize severance provisions for certain executive officers that had been governed by separate legacy arrangements. All of our NEOs, other than Mr. Rauh, who left the Company at the end of the 2017, participate in the Severance Plan. In connection with implementing the Severance Plan, all participants in the Severance Plan waived the provisions of any applicable employment agreement that would have applied under the conditions set forth under the Severance Plan. See "Potential Payments Upon Termination or Change in Control" for a description of the Severance Plan.Also on December 15, 2017, Mr. Rauh entered into the Agreement and Release in connection with his departure. In recognition of Mr. Rauh's service to the Company, the Agreement and Release provided for the beneficial modification of the terms of Mr. Rauh's outstanding equity awards. The terms of the Agreement and Release are described below under "Potential Payments Upon Termination or Change in Control."Other Compensation PoliciesStock Ownership GuidelinesWe have established stock ownership guidelines for our
CEO,Chief Executive Officer, officers reporting to theCEO,Chief Executive Officer, and directors. The approved guidelines are as follows:•CEO:Chief Executive Officer: 6x base salary••Section 16 Officers reporting to theCEO:Chief Executive Officer: 2.5x base salary••Directors:3x4x annual cash retainer2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 35Participants are expected to comply with the ownership requirements within five years of the later of(x)(a) December 12, 2015 and(y)(b) an appointment to a qualified position. Once the ownership requirements have been satisfied, future declines in share price will not affect compliance so long as the participant holds the number of equity interests he or she had at the time he or she achieved the expected ownership level. As ofDecember 30, 2017,February 15, 2022, all of our executive officers have met or exceeded the ownership expectations under the guidelines.The following components satisfy the ownership guidelines: Equity interests owned directly or indirectly (e.g., by or with a spouse or held in trust for the individual or one or more family members of the individual), equity interests, includingLP Unitslimited partnership interests (the “LP Units”) and unvested RSUs, held in qualified or nonqualified savings, profit sharing, or deferred compensation accounts, value of in-the-money spread of shares underlying vested but unexercised stock options and value of in-the-money spread of shares underlyingvested but unexercised warrants.
Annually,At least annually, the Human Capital and Compensation Committee monitorsparticipants'participants’ compliance with these guidelines.INCENTIVE COMPENSATION RECOUPMENT (“INCENTIVE CLAWBACK”) POLICIESOur Board adopted a Policy for Clawback of Incentive CompensationRecoupment ("Clawback"(the “Policy”) because it believes that it is in the best interests of the Company and its stockholders to create and maintain a culture that emphasizes integrity and accountability and that reinforces the Company’s pay-for-performance compensation philosophy. This policy applies to any current and former “officer” of the Company, as such term is defined under Rule 16a-1(f) of the Exchange Act (the “Covered Executives”). The Policy applies to annual cash bonuses and equity incentive compensation (“Incentive Compensation”). Under the Policy, if the Company is required to prepare an accounting restatement of the reported financial results of the Company or any of its segments due to (a) the material non-compliance of the Company with any financial reporting requirement (unless due to a change in accounting policy or applicable law) and (b) intentional misconduct by a Covered Executive, then the Human Capital and Compensation Committee may require any Covered Executive to repay to the Company any “Excess Compensation.” Excess Compensation means that part of the Incentive Compensation received by a Covered Executive during the one-year period preceding the publication of the restated financial statement that the Committee determines was in excess of the amount that such Covered Executive would have received had such Incentive Compensation been calculated based on the financial results reported in the restated financial statement.EachIn addition, each of the RSU, stock option and performance unit award agreements under the Omnibus Incentive Plan generally provides that if a restrictive covenant violation occurs or the Company discovers after a termination of employment or services that grounds existed for"cause" (as“cause” (as defined in the Omnibus Incentive Plan) at the time thereof, then the participant shall be required, in addition to any other remedy available (on a non-exclusive basis), to pay to the Company, within ten business days of theCompany'sCompany’s request to the participant therefor, an amount equal to the aggregate after-tax proceeds (taking into account all amounts of tax that would be recoverable upon a claim of loss for payment of such proceeds in the year of repayment) the participant received upon the sale or other disposition of, or distributions in respect of, the equity award thereunder and any shares issued in respect thereof (minus, in the case of options, the aggregate cost (if any) of the shares). Without limiting the foregoing, all awards are subject to reduction, cancellation, forfeiture or recoupment to the extent necessary to comply with applicable law. Our policy will be updated to comply with theSEC'sSEC’s final regulations as part of the Dodd-Frank Act.Compensation Risk AssessmentOur governance policies and compensation structure are not reasonably likely to have a material adverse effect on the Company. The Independent Compensation Consultant and management delivered a compensation risk assessment report to the Human Capital and Compensation Committee in
2017.2021. The following features of our program mitigate risk: ![[MISSING IMAGE: icon_blue-tick20.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/icon_blue-tick20.jpg)
The Human Capital and Compensation Committee consults with the Independent Compensation Consultant to assist with annual compensation decisions The Human Capital and Compensation Committee approves the annual incentive plan'splan’s financial goals at the start of the fiscal year, and approves the performance achievement level and final payments earned at the end of the fiscal year The Human Capital and Compensation Committee benchmarks total compensation opportunity for executive positions using multiple survey sources and has discretion over payout calculations and oversight of compensation plans for our executives We utilize a mix of cash and equity variable incentive programs, with a balanced mix of stock options,RSUs and performance units, which are subject to multi-year vesting Our performance units payout opportunities are capped at 200% of the target total opportunity 36 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT We utilize competitive change-in-control severance programs to help ensure executives continue to work towards our stockholders'stockholders’ best interests in light of potential employment uncertainty Executive officers are subject to minimum stock ownership guidelines An incentive Incentive clawback policy permitspolicies that permit the Company to recoupequity-basedannual cash bonuses and equity incentive compensation paid on the basis of financial results that are subsequently restated 2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 37Compensation TablesSummary Compensation TableThe following table sets forth the compensation of our NEOs for the fiscal years ended
January 1, 2022.2017, 20162021, 2020 and2015,2019, and their respective titles as ofDecember 30, 2017.Name and Principal Position Year Salary
($) Bonus
($)(1) Stock
Awards
($)(2) Option
Awards
($) Non-Equity
Incentive Plan
Compensation
($)(3) All Other
Compensation
($)(4) Total
($) Anne P. Noonan
President and Chief
Executive Officer, Director 2021 952,750 — 3,906,392 — 1,411,299 25,663 6,296,104 2020 418,931 100,000 2,660,726 — 665,480 132,583 3,977,720 Brian J. Harris
Executive Vice President, Chief Financial Officer 2021 619,030 — 1,289,836 — 489,807 14,668 2,413,341 2020 601,000 — 1,289,485 — 599,159 16,364 2,506,008 2019 583,495 — 1,272,672 — 442,982 15,964 2,315,113 Karli S. Anderson
Executive Vice President, Chief Environmental, Social & Governance Officer and Head of Investor Relations 2021 349,365 — 546,102 — 237,918 13,129 1,146,514 Christopher B. Gaskill
Executive Vice President, Chief Legal Officer and Secretary 2021 397,904 — 705,775 — 282,910 13,837 1,400,426 Deon MacMillan
Executive Vice President, Chief People Officer and Head of Corporate Communications 2021 363,587 300,000 $512,903 — 214,880 12,771 1,404,141 (1)Name and Principal Position Year Salary
($) Stock
Awards
($)(1) Option
Awards
($)(2) Non-Equity
Incentive Plan
Compensation
($)(3) All Other
Compensation
($)(4) Total
($) Thomas W. Hill
2017 826,956 1,735,523 620,771 1,275,480 16,140 4,474,870 President and Chief
Executive Officer, Director
2016 800,000 5,039,389 2,696,940 1,367,520 20,541 9,924,390
2015
746,750
4,530,452
5,535,004
1,134,127
22,170
11,968,503 Michael J. Brady
2017 425,000 324,336 116,014 283,764 11,029 1,160,143 Chief Business
Development Officer
2016 382,454 1,405,378 760,073 290,973 11,495 2,850,373
2015
371,315
1,459,930
1,707,379
271,803
10,975
3,821,402 Brian J. Harris
2017 550,000 650,591 232,706 450,326 10,400 1,894,023 Chief Financial Officer
2016 519,045 1,347,477 643,236 469,087 26,261 3,005,106
2015
503,928
1,334,756
905,740
459,204
24,730
3,228,358 M. Shane Evans
2017 420,787 321,112 114,863 323,669 14,056 1,194,487 West Division President
Douglas C. Rauh
2017 550,000 1,264,589 2,177,649 437,951 10,400 4,440,589 Former Chief Operating Officer
2016 519,045 1,393,123 739,563 469,087 46,163 3,166,981
2015
503,928
1,113,297
1,150,299
459,204
34,121
3,260,849 (1)-
(2)The amounts reported in the Stock Awards column for20172021 reflect the aggregate grant date fair value of stock awards granted in fiscal2017,2021, calculated in accordance with ASC 718, utilizing the assumptions discussed in Note 13,Stock-Based Compensation, to our audited consolidated financial statements included in the20172021 Annual Report. The fiscal20172021 awards consist of time-vesting RSUs and performance units. As the performance units vest according to Relative TSR, they are subject to market conditions, and not performance conditions, as defined under ASC 718, and therefore have no maximum grant date fair values that differ from the grant date fair values presented in the table.As described in "Potential Payments Upon Termination or Change in Control—Departure of Douglas C. Rauh," on December 15, 2017, our Board amended the terms of Mr. Rauh's outstanding equity awards. Accordingly, the amount reported in this column for fiscal 2017 for Mr. Rauh includes the incremental fair value computed as of the modification date in accordance with ASC 718 with respect to his modified LP Units, RSUs and performance units, in the amounts of $52,483, $689,465 and $522,641, respectively.(2)The amounts reported in the Option Awards column for 2017 reflect the aggregate grant date fair value of the option awards granted in fiscal 2017, calculated in accordance with ASC 718, utilizing the assumptions discussed in Note 13,(3)Stock-Based Compensation, to our audited consolidated financial statements included in the 2017 Annual Report. As described in "Potential Payments Upon Termination or Change in Control—Departure of Douglas C. Rauh," on December 15, 2017, our Board amended the terms of Mr. Rauh's outstanding equity awards. Accordingly, the amount reported in this column for fiscal 2017 for Mr. Rauh includes the incremental fair value computed as of the modification date in accordance with ASC 718 with respect to his modified Leverage Restoration Options and option awards, in the amounts of $1,802,383 and $375,266, respectively.(3)- Reflects non-equity incentive plan compensation awards for services rendered during the fiscal year presented. For more information, see
"Compensation“Compensation Discussion and Analysis—Compensation Elements—Annual Cash Incentives."- ”
(4)All Other Compensation includes the following items for2017:2021: (a) amounts contributed by Summit LLC under the Summit Materials, LLC Retirement Plan,and(b) payments for term life and/or disabilityinsurance.insurance, (c) amounts contributed by the Company to Health Savings Accounts (“HSAs”), and (d) amounts paid by the Company for the Executive Health Program. Amounts contributed to the Summit Materials, LLC Retirement Plan are matching contributions up to 4% of eligible compensation subject to IRSlimitslimits. In 2021, Mss. Noonan, Anderson, andtotaled $10,400 forMacMillan and Messrs. Harris and Gaskill each received a matching contribution ofthe NEOs in 2017.$11,600. Matching contributions are immediately vested. For more information, see"Compensation“Compensation Discussion and Analysis—Compensation Elements—Retirement, Perquisites, and Other Benefits."” Payments for term life and/or disability insurance in20172021 were as follows: Ms. Noonan, $14,063; Mr. Harris, $1,868; Ms. Anderson, $1,529; Mr. Gaskill, $1,637; and Ms. MacMillan, $1,171. Amounts contributed to HSAs in 2021 were as follows: Mr.Hill $5,740; Mr. Brady $629Harris, $1,200, and Mr.Evans $3,656.Gaskill, $600. No amounts were paid by the Company for the Executive Health Program in 2021.38 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTThe following table provides supplemental information relating to grants of plan-based awards to help explain information provided above in our Summary Compensation Table.
Name Award Type Grant
Date Estimated Possible Payouts
under Non-Equity Incentive
Plan Awards(1) Estimated Future Payouts
under Equity Incentive
Plan Awards(2) All Other
Stock
Awards:
Number of
Shares
of Stock
or Units
(#)(3) Grant
Date Fair
Value of
Stock
Awards
($)(4) Threshold
($) Target
($) Maximum
($) Threshold
(#) Target
(#) Maximum
(#) Anne P. Noonan Annual Cash Incentive — 14,291 1,190,938 2,203,234 — — — — — Performance Units 3/30/2021 — — — 25,419 50,838 101,676 — 2,406,671 RSUs 3/30/2021 — — — — — — 50,838 1,499,721 Brian J. Harris Annual Cash Incentive — 5,571 464,273 858,904 — — — — — Performance Units 3/30/2021 — — — 8,393 16,786 33,572 — 794,649 RSUs 3/30/2021 — — — — — — 16,786 495,187 Karli S. Anderson Annual Cash Incentive — 2,700 225,000 416,250 — — — — — Performance Units 3/30/2021 — — — 3,554 7,107 14,214 — 336,445 RSUs 3/30/2021 — — — — — — 7,107 209,657 Christopher B. Gaskill Annual Cash Incentive — 3,024 252,000 466,200 — — — — — Performance Units 3/30/2021 — — — 4,593 9,185 18,370 — 434,818 RSUs 3/30/2021 — — — — — — 9,185 270,958 Deon MacMillan(5) Annual Cash Incentive — 2,618 218,152 403,581 — — — — — RSUs 3/10/2021 — — — — — — 16,822 512,903 (1)All Other
Stock
Awards:
Number
of Shares
of Stock
or Units
(#) (4)All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#) (5)Estimated Possible Payouts
under Non-Equity Incentive
Plan Awards (1)Estimated Future Payouts
under Equity Incentive
Plan Awards (2)Exercise
or Base
Price of
Option
Awards
($/Sh)Grant Date
Fair Value
of Stock
and
Option
Awards
($) (6)NameAward Type Grant
Date (3)Threshold
($)Target
($)Maximum
($)Threshold
(#)Target
(#)Maximum
(#)Thomas W. Hill
Annual Cash Incentive — 18,524 1,157,738 2,026,042 — — — — — — — Performance Units 2/28/2017 — — — 15,845 31,689 63,378 — — — 1,000,739 RSUs 2/28/2017 — — — — — — 30,757 — — 734,785 Stock Options 2/28/2017 — — — — — — — 51,261 23.89 620,771 Michael J. Brady
Annual Cash Incentive — 4,080 255,000 446,250 — — — — — — — Performance Units 2/28/2017 — — — 2,961 5,922 11,844 — — — 187,017 RSUs 2/28/2017 — — — — — — 5,748 — — 137,320 Stock Options 2/28/2017 — — — — — — — 9,580 23.89 116,014 Brian J. Harris
Annual Cash Incentive — 6,600 412,500 721,875 — — — — — — — Performance Units 2/28/2017 — — — 5,940 11,879 23,758 — — — 375,139 RSUs 2/28/2017 — — — — — — 11,530 — — 275,452 Stock Options 2/28/2017 — — — — — — — 19,216 23.89 232,706 M. Shane Evans
Annual Cash Incentive — 4,040 252,472 454,450 — — — — — — — Performance Units 2/28/2017 — — — 2,932 5,863 11,726 — — — 185,154 RSUs 2/28/2017 — — — — — — 5,691 — — 135,958 Stock Options 2/28/2017 — — — — — — — 9,485 23.89 114,863 Douglas C. Rauh
Annual Cash Incentive — 6,600 412,500 721,875 — — — — — — — Performance Units 2/28/2017 — — — 5,940 11,879 23,758 — — — 375,139 RSUs 2/28/2017 — — — — — — 11,530 — — 275,452 Stock Options 2/28/2017 — — — — — — — 19,216 23.89 232,706 Modified Awards: Pre-IPO LP Units 12/15/2017 — — — — — — 1,742 — — 52,483 Pre-IPO Leverage Restoration Options 12/15/2017 — — — — — — — 147,805 18.00 1,802,383 Performance Units 12/15/2017 — — — 7,829 15,657 31,314 — — — 522,641 RSUs 12/15/2017 — — — — — — 11,530 — — 689,465 Stock Options 12/15/2017 — — — — — — — 19,216 23.89 375,266 (1)- Reflects the possible payouts of cash incentive compensation under the Non-Equity Incentive Plan. Amounts reported in the
"Threshold"“Threshold” column assume that there is no payout under the EBITDA, operating cash flow, or personal objectives components of the annual cash incentive program and that each NEO only earns the minimum payout for the one safety metric that has been assigned the lowest weighting. The actual amounts paid are described in the"Non-Equity“Non-Equity Incentive PlanCompensation"Compensation” column of the"Summary“Summary Compensation Table." - ”
(2)Reflects the performance units granted in2017,2021, which have a three-year performance period ending December 31,2019,2023, and vest based on RelativeTSR.TSR and ROIC performance. Threshold assumes that 50% of the total performance units awarded vest and maximum assumes that 200% of the total performance units awarded vest.The amounts reported under "Modified Awards" for Mr. Rauh reflect his performance units that were modified on December 15, 2017 and remain outstanding as described in "Potential Payments Upon Termination or Change in Control—Departure of Douglas C. Rauh."(3)December 15, 2017 is the date that Mr. Rauh's LP Units, Leverage Restoration Operations, Performance Units, RSUs and Stock Options were modified as described in "Potential Payments Upon Termination or Change in Control—Departure of Douglas C. Rauh."(4)Reflects the RSUs granted in2017 and the amounts reported under "Modified Awards" reflect Mr. Rauh's RSUs that were modified on December 15, 2017 as described in "Potential Payments Upon Termination or Change in Control—Departure of Douglas C. Rauh."(5)Reflects stock options granted in 2017 and the amounts reported under "Modified Awards" reflect Mr. Rauh's Leverage Restoration Options and stock options that were modified on December 15, 2017 as described in "Potential Payments Upon Termination or Change in Control—Departure of Douglas C. Rauh."(6)- 2021.
(4)Represents the grant date fair value of the performance unitsRSUsandstock optionsRSUs granted in2017 and the incremental fair value computed as of the modification date in connection with ASC 7182021 with respect toMr. Rauh's LP Units, Leverage Restoration Operations, Performance Units, RSUs and Stock Options that were modified on December 15, 2017.the NEOs. The assumptions applied in determining the fair value of the awards are discussed in Note 13,Stock-Based Compensation, to our audited consolidated financial statements included in the20172021 Annual Report.(5)Employment ArrangementsMessrs. HillNarrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards TableOffers of Employment and Employment ArrangementsMss. Anderson, MacMillian, and Noonan and Mr. Gaskill each has a signed offer of employment, and Mr. Harriseach havehas an employmentagreements and Messrs. Brady and Evans have signedagreement. The offers ofemployment. Theiremploymentagreementsandoffers ofemployment agreement provide for base salary subject to annual adjustment by the Board, an annual incentive award, participation in Company-sponsored broad-based and executive benefit plans and such other compensation as may be approved by the Board. In connection with implementing the Executive Severance PlanMessrs. Hill and(the “Severance Plan”), Mr. Harris waived the provisions intheirhis employment agreements that would have applied under the conditions set forth in the Severance Plan, other than any provisions intheirhis employment agreements which were intended to survive the termination ofsuchhis employmentagreements.agreement.
Pursuant to Ms. MacMillan’s offer letter, her target annual cash bonus for 2021 was prorated for the period of time in which she was employed by the Company. In addition, Ms. MacMillan’s offer letter provided that Ms. MacMillan would receive a one-time cash sign-on bonus of $300,000 that is subject to recoupment upon termination by the Company for cause or resignation by Ms. MacMillan within twenty-four months of March 9, 2021. Ms. MacMillan’s offer letter also provided that she would receive an initial award of RSUs promptly following her start date. The RSUs had a value of $450,000 and vest as follows: (i) $150,000 to vest on the grant date, (ii) $175,000 to vest on the first anniversary of the grant date, and (iii) $125,000 to vest on the second anniversary of the grant date. Then, beginning in 2022, her annual target award will have a grant date fair value of 125% of her annual base salary.Pre-IPO Long-Term Incentive Awards (Value From Modifications to Eliminate Misalignment Post-IPO)Prior to theCompany's IPOCompany’s initial public offering (“IPO”) in March 2015, the equity-based long-term incentive program consisted of Class D interests. In connection with theCompany'sCompany’s IPO in March 2015, the limited partnership agreement of Summit Holdings was amended and restated to, among other things, modify its capital structure by creating LP Units (the"Reclassification"“Reclassification”). Immediately following the Reclassification,69,007,297the LP Unitswere outstanding, whichwere reclassified from previously issued Class A-1, Class B-1, Class C, Class D-1 and Class D-2 interests.The Class A-1, Class B-1 and Class C interests, which were issued in respect of pre-IPO investments and not related to employee compensation, were fully vested as of the Reclassification. A portion, but not all, of the Class D-1 interests were vested, and none of the Class D-2 interests were vested. Accordingly, vested and unvested Class D interests were converted into vested and unvested LP Units, respectively. The vesting terms were substantially similar to those applicable to the unvested Class D interests immediately prior to the Reclassification. As of their respective grant date, approximately half of the Class D-1 interests were time-vesting interests and approximately half of the D-1 interests and all of the D-2 interests were performance-vesting interests.In addition, in substitution for part of the economic benefit of the Class C and Class D interests that was not reflected in the conversion of such interests to LP Units, warrants were issued to holders of Class C interests to purchasean aggregate of 160,333shares of Class A Common Stock, and options were issued to holders of Class D interests to purchasean aggregate of 4,358,842shares of Class A Common Stock("(“Leverage RestorationOptions"Options”). The exercise price of the warrants and Leverage Restoration Options was the IPO price of $18.00 per share. The Leverage Restoration Options were grantedunder the Omnibus Incentive Plan.All Leverage Restoration Options vest over four years at a rate of 25% of the award on each of the first four anniversaries of the Reclassification, subject to the employee's continued employment through the applicable vesting date. The Leverage Restoration Options that correlated to performance-vesting interests vested only if both the relevant return multiple was achieved and the four year time-vesting condition was satisfied.On August 9, 2016, our Board upon the recommendation of the Compensation Committee, determined that it was in the best interest of the Company and its stockholders to remove the 3.00 times investment return condition on the approximately 23% remaining pre-IPO performance-vesting LP Units and Leverage Restoration Options. As a result, all pre-IPO performance-vesting LP Units are now fully vested and the performance-vesting Leverage Restoration Options continue to be subject to the same four-year time vesting condition as the time-vesting Leverage Restoration Options.In 2018, a sub-committee of the Compensation Committee consisting of members that do not hold LP Units (the "Sub-Committee") determined that the administrative burden and costs associated with the monthly vesting of the remaining time-vesting LP Units outweighed any remaining retention incentive associated with the awards. As a result, the Sub-Committee determined it was appropriate to accelerate the vesting of all the remaining time-vesting LP Units held by our employees. The incremental fair value computed in accordance with FASB ASC Topic 718 with respect to this modification for each of the NEOs was not material.All outstanding equity grants associated with the Reclassification and subsequent modifications are summarized in the table titled
"Outstanding“Outstanding Equity Awards at20172021 Fiscal Year-End."”40 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTOutstanding Equity Awards at 2021 Fiscal Year-EndOutstanding Equity Awards at 2017 Fiscal Year-EndA summary of the outstanding equity awards for each NEO as of
follows in the below table.December 30, 2017January 1, 2022 is asfollows: Option Awards Stock Awards Name Grant Date Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable Equity Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#) Option
Exercise
Price ($) Option
Expiration
Date(1) Number of
Shares or
Units of
Stock That
Have Not
Vested (#) Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)(2) Equity Incentive
Plan Awards:
Number of
Unearned Shares,
Units or Other
Rights That Have
Not Vested (#) Equity Incentive
Plan Awards:
Market or
Payout Value of
Unearned
Shares, Units or
Other Rights
That Have Not
Vested ($)(2) Anne P. Noonan 7/20/2020 — — — — — 42,577(3) 1,709,041 — — 7/20/2020 — — — — — — — 139,046(4) 5,581,306 3/30/2021 — — — — — 50,838(3) 1,499,721 — — 3/30/2021 — — — — — — — 101,676(5) 4,081,275 Brian J. Harris 2/28/2017 19,216(6) — — 23.89 2/28/2027 — — — — 2/28/2019 — — — — — 9,820(3) 394,175 — — 2/28/2020 — — — — — 13,270(3) 532,658 — — 2/28/2020 — — — — — — — 39,810(4) 1,597,973 7/30/2020 — — — — — 13,238(7) 531,373 — — 3/30/2021 — — — — �� — 16,786(3) 673,790 — — 3/30/2021 — — — — — — — 33,572(5) 1,347,580 Karli S. Anderson 9/30/2019 — — — — — 1,000(3) 40,140 — — 2/28/2020 — — — — — 4,402(3) 176,696 — — 7/30/2020 — — — — — 5,710(7) 229,199 — — 3/30/2021 — — — — — 7,107(3) 285,275 — — 3/30/2021 — — — — — — — 14,214(5) 570,550 Christopher B. Gaskill 2/28/2019 — — — — — 2,236(3) 89,753 2/28/2020 — — — — — 5,384(3) 216,114 7/30/2020 — — — — — 6,985(7) 280,378 3/30/2021 — — — — — 9,185(3) 368,686 3/30/2021 — — — — — — — 18,370(5) 737,372 Deon MacMillan 3/10/2021 — — — — — 11,215(8) 450,170 — — (1)Option Awards Stock Awards NameGrant Date Number of
Securities
Underlying
Unexercised
Options
(#)
ExercisableNumber of
Securities
Underlying
Unexercised
Options
(#)
UnexercisableEquity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#)Option
Exercise
Price
($)Option
Expiration
Date
(1)Number of
Shares or
Units of
Stock
That Have
Not Vested
(#)Market Value
of Shares
or Units
of Stock
That Have
Not Vested
($) (2)Equity
Incentive
Plan Awards:
Number of
Unearned
Shares, Units or
Other Rights
That Have Not
Vested
(#)Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units or
Other Rights
That Have Not
Vested
($) (2)Thomas W. Hill
3/11/15 293,055(3 ) 643,059 — 18.00 3/11/25 — — — — 3/11/15 29,463(4 ) — — 18.00 3/11/25 — — — — 2/24/16 23,980(6 ) 47,958 — 17.07 2/24/26 — — — — 2/24/16 — — — — — 28,763(7 ) 904,309 — — 2/24/16 — — — — — — — 44,452(8 ) 1,397,571 2/28/17 — 51,261(6 ) — 23.89 2/28/27 — — — — 2/28/17 — — — — — 30,757(7 ) 967,000 — — 2/28/17 — — — — — — — 63,378(9 ) 1,992,604 Michael J. Brady
3/11/15
203,536(3
)
203,536
18.00
3/11/25
—
—
—
—3/11/15 6,852(4 ) — — 18.00 3/11/25 — — — — 3/11/15 — — — — — 1,655(5 ) 52,033 — — 2/24/16 4,500(6 ) 8,998 — 17.07 2/24/26 — — — — 2/24/16 — — — — — 5,397(7 ) 169,682 — — 2/24/16 — — — — — — — 8,341 (8 ) 262,241 2/28/17 — 9,580(6 ) — 23.89 2/28/27 — — — — 2/28/17 — — — — — 5,748(7 ) 180,717 — — 2/28/17 — — — — — — — 11,844(9 ) 372,375 Brian J. Harris
3/11/15
116,380(3
)
116,380
—
18.00
3/11/25
—
—
—
—3/11/15 — — — — — 19,978(5 ) 628,108 — — 2/24/16 9,465(6 ) 18,930 — 17.07 2/24/26 — — — — 2/24/16 — — — — — 11,353(7 ) 356,938 — — 2/24/16 — — — — — — — 17,546(8 ) 551,646 2/28/17 — 19,216(6 ) — 23.89 2/28/27 — — — — 2/28/17 — — — — — 11,530(7 ) 362,503 — — 2/28/17 — — — — — — — 23,758(9 ) 746,952 M. Shane Evans
3/11/15
116,241(3
)
123,443
—
18.00
3/11/25
—
—
—
—3/11/15 — — — — — 993(5 ) 31,220 — — 2/24/16 4,718(6 ) 9,436 — 17.07 2/24/26 — — — — 2/24/16 — — — — — 5,659(7 ) 177,919 — — 2/24/16 — — — — — — — 8,756(8 ) 275,289 2/28/17 — 9,485(6 ) — 23.89 2/28/27 — — — — 2/28/17 — — — — — 5,691(7 ) 178,925 — — 2/28/17 — — — — — — — 11,726(9 ) 368,665 Douglas C. Rauh(10)
3/11/15
—
147,805(3
)
18.00
3/11/25
—
—
—
—3/11/15 — — — — — 1,742(5 ) 54,768 — — 2/24/16 — 18,930(6 ) — 17.07 2/24/26 — — — — 2/24/16 — — — — — 11,353(7 ) 356,938 — — 2/24/16 — — — — — — — 17,546(8 ) 551,646 2/28/17 — 19,216(6 ) — 23.89 2/28/27 — — — — 2/28/17 — — — — — 11,530(7 ) 362,503 — — 2/28/17 — — — — — — — 23,758(9 ) 746,952 (1)- Reflects the expiration date of the Leverage Restoration Options and stock options which is ten years from the date of grant.
The warrants expire on the tenth anniversary of the pricing of the Company's IPO.See"Narrative“Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Pre-IPOPre IPO Long-Term IncentiveAwards"Awards” for a description of these equity awards.
(2)Amounts reported are based on the closing price of our Class A Common Stock on December29, 201731, 2021 ($31.44)40.14), the last trading day of the fiscal year.(3)Table of Contents(3)Reflects Leverage Restoration Options that vest over four years at a rate of 25% of the award on each of the first four anniversaries of the Reclassification, subject to the employee's continued employment through the applicable vesting date.(4)Reflects warrants issued in connection with the Reclassification as described in "Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Pre-IPO Long-Term Incentive Awards." The warrants became exercisable on March 17, 2016.(5)Reflects time-vesting LP Units, 20% of which vest on the first anniversary of the legacy Class D-1 interests' grant date and the remaining 80% vest monthly over the four years following the first anniversary. As described in "Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Pre-IPO Long-Term Incentive Awards," all time-vesting LP Units are now fully vested.(6)Reflects stock options which vest over three years in equal annual installments on the anniversary of the grant date.(7)- Reflects RSUs which vest over three years in equal annual installments on the anniversary of the grant date.
(8)
(4)Reflects performance units which vest according to Relative TSR and ROIC performance at the end of a three-year performance period. In the table above, the number and market value of units that vest based on Relative TSR and ROIC performance reflecttargetmaximum performance, because actual performance during the performance periods that have elapsed throughDecember 30, 2017 was between threshold and target.January 1, 2022 were above target performance. The actual numbers of shares that will be distributed with respect to the20162020 performance units are not yet determinable.(9)(5)Reflects performance units which vest according to Relative TSR and ROIC performance at the end of a three-year performance period. In the table above, the number and market value of units that vest based on Relative TSR and ROIC performance reflect maximum performance, because actual performance during the performance periods that have elapsed throughDecember 30, 2017 was betweenJanuary 1, 2022 were above targetand maximum.performance. The actual numbers of shares that will be distributed with respect to the20172021 performance units are not yet determinable.(10)As described(6)Reflects stock options which vest over three years in"Potential Payments Upon Termination or Changeequal annual installments on the anniversary of the grant date.(7)Reflects RSUs which vest over two years inControl—Departureequal annual installments on the anniversary ofDouglas C. Rauh,"the grant date.(8)Reflects RSUs which vest as follows: (a) 58.33% vest onDecember 15, 2017, our Board amendedMarch 9, 2022, and (b) theterms of Mr. Rauh's outstanding equity awards.remaining vest on March 9, 2023.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 41The following table provides information regarding the amounts recognized by our NEOs upon the
2021. Our NEOs did not exercise any stock options during 2021.exercise of stock options and thevesting of stock awards during2017. Stock Awards Name Number
of Shares
Acquired on
Vesting (#)(1) Value
Realized
on Vesting ($)(2) Anne P. Noonan 21,289 684,228 Brian J. Harris 34,459 1,033,361 Karli S. Anderson 8,912 285,799 Christopher B. Gaskill 28,248 938,800 Deon MacMillan 5,607 170,957 (1)Option Awards Stock Awards NameNumber of
Shares
Acquired
on
Exercise
(#)(1)Value
Realized
on
Exercise
($)(2)Number of
Shares
Acquired
on Vesting
(#)(3)Value
Realized
on
Vesting
($)(4)Thomas W. Hill
350,000 3,825,500 14,382 336,826 Michael J. Brady
— — 3,940 97,818 Brian J. Harris
— — 29,647 801,081 M. Shane Evans
7,200 69,120 3,575 87,047 Douglas C. Rauh
157,268 1,683,945 6,983 169,393 (1)Represents Leverage Restoration Options and stock options.(2)The value realized on exercise is based on the closing market price of our Class A common stock on the applicable exercise date minus the exercise price of the option.(3)- Represents time-vesting
LP UnitsRSUs andRSUs. (4)- performance units.
(2)The value realized on vesting is based on the closing market price of our Class A common stock on the applicable vesting date.
2017 Non-Qualified Deferred CompensationThe following table provides information regarding contributions, earnings and balances for our NEOs with respect to our DCP, the only defined contribution or other plan that provides for the deferral of compensation on a basis that is not tax-qualified.
Name Executive
Contributions
in Last FY(1) ($) Registrant
Contributions in
Last FY ($) Aggregate
Earnings in
Last FY(2) ($) Aggregate
Withdrawals/
Distributions ($) Aggregate
Balance
at Last FYE(3) ($) Brian J. Harris $ 309,515 — $ 388,618 — $ 2,571,833 (1)NameExecutive
Contributions
in Last FY(1)
($)Registrant
Contributions
in Last FY
($)Aggregate
Earnings in
Last FY(2)
($)Aggregate
Withdrawals/
Distributions
($)Aggregate
Balance at
Last FYE(3)
($)Thomas W. Hill
273,504 — 50,836 — 324,340 Brian J. Harris
275,000 — 64,515 — 520,283 (1)- These amounts are also reported in the
"Salary"“Salary” column for20172021 in the"Summary“Summary Compensation Table." - ”
(2)Amounts in this column are not reported as compensation for fiscal20172021 in the"Summary“Summary CompensationTable"Table” since they do not reflect above-market or preferential earnings.(3)Mr. Hill commenced participation in the DCP in fiscal 2017 and therefore no amounts in this column have previously been reported in the "Summary Compensation Table."Mr. Harris commenced participation in the DCP in fiscal 2016 and$173,015300,500 was previously reported in the"Salary"“Salary” column for2016 with respect to Mr. Harris2020 and $291,748 was previously reported in the"Summary“Salary” column for 2019 in the “Summary Compensation Table."”Pursuant to the DCP, an eligible participant may elect to defer up to 50% of suchparticipant'sparticipant’s base salary compensation (in 5% increments) and up to 100% of suchparticipant'sparticipant’s designated discretionary bonus award compensation and annual incentive award compensation (in 5% increments). Deferral elections are generally made by participants prior to the close of the taxable year preceding the taxable year for which the applicable compensation is earned. The DCP also permits Company-provided credits toparticipants'participants’ accounts, but no such credits are currently being made. Participants are permitted to make individual investment elections that will determine the rate of return on their deferral amounts under the DCP and may change their investment elections at any time. Deferrals are only deemed to be invested in the investment options selected. Participants have no ownership interest in any of the funds as investment elections are used solely to measure the amounts of investment earnings or losses that will be credited or debited to theparticipants'participants’ accounts on theCompany'sCompany’s books and records. Investment funds are valued each day that the NYSE is open for trading. Participant deferrals under the DCP and the earnings thereon are always 100% vested.The table below shows the funds in which our NEOs invested during2017,2021, and their rate of return from January 1,20172021 through December 31,2017.2021.Name of Investment FundRate of Return %Alger Capital Appreciation Z 31.69Rate of Return % Alger Capital Appreciation Z
17.93% American Century Real Estate R 41.82% American Funds New World R6 33.06 17.93% Columbia Dividend Income Y
20.95 26.45% Fidelity Advisor International
Discv Z 31.88 11.26% Janus
HendersonTriton N 27.24 7.21% Pioneer Bond K
0.96% Undiscovered Managers Behavioral Val R6 13.53 34.50% Vanguard 500 Index
AdmiralInvestor 21.67 28.66% Vanguard Mid Cap Index
AdmiralInvestor 19.12 24.51% Vanguard Small Cap Index
AdmiralFund 16.10 17.73% 42 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTTable of ContentsA DCP participant may elect, at the time of such
participant'sparticipant’s deferral elections, to receive benefit distributions upon (i) separation from service with the Company or (ii) following the earlier of (a) a specified date that occurs no earlier than at least three years from the end of the calendar year in which the deferred compensation is credited or (b) separation from service with the Company. Additionally, a DCP participant may elect, at the time of suchparticipant'sparticipant’s deferral elections, to receive benefit distributions in the form of (i) a single lump sum payment or (ii) for distributions following retirement, annual installments with an installment term of between two and 15 years. A participant may elect to change the benefit distribution date and/or form under certain circumstances specified in the DCP. In addition, in the event of certain unforeseeable emergencies, a participant may apply for immediate distribution in an amount necessary to satisfy such financial hardship and the tax liability attributable to such distribution. In the event of aparticipant'sparticipant’s death or disability, the entire value of suchparticipant'sparticipant’s account will be distributed in a single lump sum.
EXECUTIVE SEVERANCE PLANPotential Payments Upon Termination or Change in ControlExecutive Severance PlanThe Board, upon the recommendation of the Human Capital and Compensation Committee, adopted the Severance Plan in December 2017, which provides severance benefits to certain executive officers of the Company and its affiliates in the event that an eligible employee experiences a termination of employment by the Company without"cause" (and“cause” (and other than due to death or disability) or by the employee as a result of a"constructive termination" (as“constructive termination” (as such terms are defined in the Severance Plan) (each, a"Qualifying Termination"“Qualifying Termination”). In the event that a Qualifying Termination occurs during the two-year period beginning on the date of a change in control (each such termination, a"Qualifying“Qualifying Change in ControlTermination"Termination”), the Severance Plan provides enhanced severance benefits. In connection with implementing the Severance Plan, all participants in the Severance Plan waived the provisions of any applicable employment agreement that would have applied under the conditions set forth under the Severance Plan, other than any provisions in such employment agreements which were intended to survive the termination of such employment agreement.Each participant in the Severance Plan (a"Participant"“Participant”) is designated as a Tier 1 Participant or Tier 2 Participant. Tier 1 Participants are limited to the Chief Executive Officer. Tier 2 Participants are limited to Executive Vice Presidents. Accordingly,Mr. HillMs. Noonan is a Tier 1 Participant and Mess. Anderson and MacMillan and Messrs.Brady,Gaskill and Harrisand Evansare each Tier 2 Participants.In the event of a Qualifying Termination, Participants are provided with the following payments and benefits:•a pro-rata payment representing the amount otherwise payable under the annual bonus program for the fiscal year in which termination of theParticipant'sParticipant’s employment occurs, based on actual performance and payable concurrently with cash bonus payments to other employees (but in all events on or about March 15 of the immediately following fiscal year) (a"Pro-Rata Bonus"“Pro-Rata Bonus”), and to the extent not previously paid, the amount otherwise payable under the annual bonus program for the immediately preceding fiscal year, payable concurrently with cash bonus payments to other employees (a"Prior“Prior YearBonus"Bonus”);••a cash paymentof(i) for a Tier 1 Participant, of 2.5 times theParticipant'sParticipant’s annual base salary, payable over a period of 30 months, and (ii) for a Tier 2 Participant, of 2 times theParticipant'sParticipant’s annual base salary, payable over a period of 24 months; and•Table of Contents•- a cash payment, payable monthly in accordance with the Company’s payroll practices, (i) for a Tier 1 Participant, for up to 30 months, and (ii) for a Tier 2 Participant, for up to 24 months, in each case in an amount equal to the total amount of the monthly COBRA insurance premiums for participation in the life, health, dental and disability benefit programs of the Company in which the Participant participated as of the date of termination
payable monthly in accordance with the Company's payroll practices, (i) for a Tier 1 Participant, for up to 30 months, and (ii) for a Tier 2 Participant, for up to 24 months(the"COBRA Benefits"“COBRA Benefits”).
In the event of a Qualifying Change in Control Termination, Participants are provided with the following payments and benefits:•a Pro-Rata Bonus, and, if applicable, a Prior Year Bonus;••a cash payment of (i) for a Tier 1 Participant, 2.5 times the sum of theParticipant'sParticipant’s annual base salary and target annual bonus, and (ii) for a Tier 2 Participant, 2 times the sum of theParticipant'sParticipant’s annual base salary and target annual bonus, in each case of (i) and (ii), payable in a lump sum no later than the 60th day following the date of termination; and••the COBRA Benefits.The payments and benefits provided under the Severance Plan are subject to eachParticipant'sParticipant’s execution and delivery of a release of claims and eachParticipant'sParticipant’s compliance with non-competition, non-disparagement, non-solicitation and confidentiality covenants applicable pursuant to eachParticipant'sParticipant’s Participation Notice and Agreement under the Severance Plan. The non-disparagement and confidentiality covenants each have an indefinite term and the non-competition and non-solicitation covenants each have a term of1224 months following theParticipant'sParticipant’s date oftermination (18 months for Mr. Hill).termination. Additionally, the Severance Plan provides that if a Participant is subject to an excise tax under Section 4999 of the Code, then the payments and benefits the Participant receives may be reduced so that the excise tax does not apply; however, such reduction will only occur if it results in the receipt of a greater after-tax severance than would otherwise be provided.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 43Treatment of Long-Term Incentive Awards Upon Termination or Change in ControlEach of the RSUsstock optionsand performance units granted in20172021 is subject to restrictive covenants related to post-employment (i) employee, client and consultant non-solicitation and (ii) non-competition, in each case for 12 months following any termination of employment and indefinite covenants covering confidentiality and non-disparagement (participant only). Further, the equity awards and all proceeds therefrom are generally subject to theCompany'sCompany’s incentive clawbackpolicy,policies, as in effect from time to time, to the extent the participant is a director or"officer"“officer” as defined under Rule 16a-1(f) of theExchange Act. Additional provisions regarding the treatment of the equity awards upon a termination of employment are outlined in the table below.
Award Type Termination or Change in Control Provisions Stock Options(1) Stock Options•Death or Disability: Unvested portion will immediately vest; vested stock options remain exercisable for one year thereafter.(1)(2)
•Retirement(2)(3): Unvested portion will continue to vest according to the original vesting schedule; vested stock options remain exercisable for five years after the later of (i) the termination date and (ii) the date the option becomes vested and exercisable.•Constructive Termination(3)(4) / By the Company Without Cause: Prorated portion of the number of options that would otherwise vest on the next applicable vesting date will immediately vest(4)(5); vested stock options remain exercisable for three months thereafter.•Change in Control: Accelerated only if (i) not continued, converted, assumed, or replaced by the Company or successor entity or (ii) employment is terminated by the Company or successor entity without cause or by the participant as a result of a"constructive termination"“constructive termination” during the two-year period following a change in control; vested stock options remain exercisable for three months thereafter.•By the Company For Cause / by Participant When Grounds for Cause Exist: Vested and unvested portions are forfeited. RSUs
•Death or Disability: Unvested portion will immediately vest.•Retirement: Unvested portion will continue to vest according to the original vestingschedule.schedule (solely if such retirement occurs on or following the first anniversary of the vesting start date).•Constructive Termination / By the Company Without Cause: Prorated portion of the number of RSUs that would otherwise vest on the next applicable vesting date will immediately vest.•Change in Control: Accelerated only if (i) not continued, converted, assumed, or replaced by the Company or successor entity or (ii) employment is terminated by the Company or successor entity without cause or by the participant as a result of a"constructive termination"“constructive termination” during the two-year period following a change in control.•By the Company For Cause: Vested and unvested portions are forfeited.Award TypeTermination or Change in Control Provisions Performance Units
•Death or Disability(5)(6): Prorated portion will vest at the end of the performance period, based on actual performance.•Retirement: Prorated portion will vest at the end of the performance period, based on actualperformance.performance (solely if such retirement occurs on or following the first day of the performance period).•Constructive Termination / By the Company Without Cause: Prorated portion will vest at the end of the performance period, based on actual performance.•Change in Control: (i) Full vesting at target only if not continued, converted, assumed, or replaced by the Company or successor entity and (ii) pro-rata vesting at target if employment is terminated by the Company or successor entity without cause or by the participant as a result of a"constructive termination"“constructive termination” during the two-year period following a change in control.•By the Company For Cause: Vested and unvested portions are forfeited. Pre-IPO Leverage RestorationOptions•Death or Disability: Unvested portion is forfeited; vested stock options remain exercisable for one year thereafter.•Retirement: Unvested portion is forfeited; vested stock options remain exercisable for three months thereafter.•Constructive Termination / By the Company Without Cause: Unvested portion is forfeited; vested stock options remain exercisable for three months thereafter.•Change in Control: Unvested portion will immediately vest.•By the Company For Cause / by Participant When Grounds for Cause Exist: Vested and unvested portions are forfeited.Pre-IPO LP Units•Death or Disability: Unvested portion is forfeited.•Retirement: Unvested portion is forfeited.•Constructive Termination / By the Company Without Cause: Unvested portion is forfeited.•Change in Control: Unvested portion will immediately vest.•By the Company For Cause: Unvested portion is forfeited.- (1)
All outstanding stock options are fully vested.(2)Stock options do not remain exercisable past the original expiration date. In addition, the exercisability period expires immediately upon the occurrence of a"restrictive“restrictive covenantviolation" (asviolation” (as defined in the award agreement).(2)"Retirement"(3)“Retirement” is generally defined in the equity awards as termination of employment, other than for cause or while grounds for cause exist, and other than due to theparticipant'sparticipant’s death or disability, following the date on which (i) the participant attains age 62 and (ii) the number of completed years of employment with the Company and its affiliates is at least five. For stock options and RSUs, continuation of vesting after termination of employment is subject to the non-occurrence of a"restrictive“restrictive covenant violation."(3)"”44 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT(4)“Constructivetermination"termination” is generally defined in the equity awards as (i) having the meaning set forth in any employment agreement entered into by and between the participant and the Company or an affiliate, or (ii) if no such agreement exists, any of the following, without theparticipant'sparticipant’s prior written consent: (a) a material reduction in base salary or, to the extent applicable, target bonus opportunity (other than in connection with an across-the-board reduction in compensation of similarly-situated employees of, on an individual-by-individual basis, less than 10%), (b) a material diminution of authority, duties, or responsibilities, (c) a relocation of theparticipant'sparticipant’s primary place of business by more than 50 miles from its then-current location, or (d) any material breach by the Company of any written agreement relating to theparticipant'sparticipant’s compensation (including any equity awards)."Constructive termination"“Constructive termination” provisions are limited to the Chief Executive Officer andhisher directreports.(4)- reports and other Section 16 officers.
(5)Prorated based on the number of days in the applicable year or in the performance period, as applicable, that have elapsed prior to termination of employment.(5)(6)Vesting of the prorated portion at the end of the performance period is subject to the non-occurrence of a"restrictive“restrictive covenant violation,"” in the case of each applicable termination scenario.
TERMINATION BENEFITS TABLETermination Benefits TableThe following table describes the potential payments and benefits under the
Company'sCompany’s Severance Plan and equity award agreements to which the NEOs would have been entitled assuming an eligible termination of employment or change in control occurred on December29, 2017,31, 2021, the last business day of fiscal2017.2021. A description of the provisions governing such payments under our agreements and any material conditions or obligations applicable to the receipt of payments are described above under"Executive“Executive SeverancePlan"Plan” and"Treatment“Treatment of Long-Term Incentive Awards Upon Termination or Change in Control."”
The amounts shown in the table do not include payments and benefits to the extent they are provided generally to all salaried employees upon termination of employment and do not discriminate in scope, terms or operation in favor of the NEOs. These include accrued but unpaid salary and distributions of vested plan balances under our 401(k) savings plans. Acceleration of Long-Term Incentive Awards Named Executive Officer Cash
Severance
Payment
($)(1) Pro-rata
Bonus
($)(2) COBRA
Benefit
($)(3) RSUs
($) Stock
Options
($)(*) Performance
Units
($)(4) Total
($) Anne P. Noonan Qualifying Termination 2,381,875 1,244,530 — 922,894 — — 4,549,299 Qualifying Change in Control Termination 5,359,219 1,244,530 — 3,749,678 — 4,831,291 15,184,718 Change in Control — — — 3,749,678 — 4,831,291 8,580,969 Termination Upon Death or Disability — — — 3,749,678 — — 3,749,678 Brian J. Harris Qualifying Termination 1,238,060 485,165 39,186 960,494 — — 2,722,905 Qualifying Change in Control Termination 2,166,605 485,165 39,186 2,135,609 — 3,837,826 8,664,391 Change in Control — — — 2,135,609 — 3,837,826 5,973,435 Termination Upon Death or Disability — — — 2,135,609 — — 2,135,609 Karli S. Anderson Qualifying Termination 750,000 219,052 70,629 261,746 — — 1,301,427 Qualifying Change in Control Termination 1,200,000 219,052 70,629 731,311 — 285,275 2,506,267 Change in Control — — — 731,311 — 285,275 1,016,586 Termination Upon Death or Disability — — — 731,311 — — 731,311 Christopher B. Gaskill Qualifying Termination 840,000 249,486 19,103 384,078 — — 1,492,667 Qualifying Change in Control Termination 1,344,000 249,486 19,103 954,931 — 368,686 2,936,206 Change in Control — — — 954,931 — 368,686 1,323,617 Termination Upon Death or Disability — — — 954,931 — — 954,931 Deon MacMillan Qualifying Termination 900,000 227,969 — 125,047 — — 1,253,016 Qualifying Change in Control Termination 1,440,000 227,969 — 450,170 — — 2,118,139 Change in Control — — — 450,170 — — 450,170 Termination Upon Death or Disability — — — 450,170 — — 450,170 2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 45Acceleration of Long-Term Incentive Awards Named Executive OfficerCash
Severance
Payment
($)(1)Pro-rata
Bonus
($)(2)COBRA
Benefit
($)(3)Pre-IPO
LP Units
($)Pre-IPO
Leverage
Restoration
Options
($)RSUs
($)Stock
Options
($)Performance
Units
($)(4)Total Thomas W. Hill
Qualifying Termination
2,067,390 1,275,480 57,071 — — 645,406 394,654 — 5,570,823 Qualifying Change in Control Termination
4,961,738 1,275,480 57,071 — 8,642,713 1,871,309 1,076,177 2,393,873 20,278,361 Change in Control
— — — — 8,642,713 1,871,309 1,076,177 2,393,873 13,984,072 Termination Upon Death or Disability(5)
— — — — — 1,871,309 1,076,177 — 4,078,308 Michael J. Brady
Qualifying Termination
850,000 283,764 45,657 — — 120,900 73,967 — 1,586,265 Qualifying Change in Control Termination
1,360,000 283,764 45,657 — 2,735,524 350,399 201,630 448,429 5,425,403 Change in Control
— �� — — 2,735,524 350,399 201,630 448,429 3,735,982 Termination Upon Death or Disability(5)
— — — — — 350,399 201,630 — 764,006 Brian J. Harris
Qualifying Termination
1,100,000 450,326 37,821 — — 249,420 153,644 — 2,432,071 Qualifying Change in Control Termination
1,925,000 450,326 37,821 — 1,564,147 719,442 417,105 925,122 6,038,963 Change in Control
— — — — 1,564,147 719,442 417,105 925,122 3,625,816 Termination Upon Death or Disability(5)
— — — — — 719,442 417,105 — 1,577,407 M. Shane Evans
Qualifying Termination
841,574 323,669 45,657 — — 123,834 76,390 — 1,630,348 Qualifying Change in Control Termination
1,346,518 323,669 45,657 — 1,659,074 356,844 207,207 459,276 4,398,245 Change in Control
— — — — 1,659,074 356,844 207,207 459,276 2,682,401 Termination Upon Death or Disability(5)
— — — — — 356,844 207,207 — 783,275 (*)- As of December 31, 2021, all outstanding stock options were fully vested.
(1)In the event of a"constructive termination"“constructive termination” or termination by the Company without"cause" (each“cause” (each term as defined in the Severance Plan), the cash severance payment includes the following:•Mr. Hill –Ms. Noonan—a cash payment of 2.5 timeshisher annual base salary, payable over a period of 30 months.•Messrs.Brady,Harris andEvans –Gaskill and Mss. Anderson and MacMillan—a cash payment of 2 times eachNEO'sNEO’s annual base salary, payable over a period of 24 months.In the event of a constructive termination or termination by the Company without cause during the two-year period beginning on the date of a change in control of the Company, the cash severance payment includes the following:•Mr. Hill –Ms. Noonan—a cash payment payable in a lump sum no later than the 60th day following the date of termination equal to 2.5 times the sum ofhisher annual base salary and target annual bonus for2017.2021.•Messrs.Brady,Harris andEvans –Gaskill and Mss. Anderson and MacMillan—a cash payment payable in a lump sum no later than the 60th day following the date of termination equal to 2 times the sum of each NEOs annual base salary and target annual bonus for2017.2021.(2)Pro-rata bonus represents the amount otherwise payable under the annual bonus program for the fiscal year in which termination of theParticipant'sParticipant’s employment occurs, based on actual performance and payable concurrently with cash bonus payments to other employees (but in all events prior to March 15 of the immediately following fiscal year).(3)(3)- COBRA benefit represents a cash payment in an amount equal to the total amount of the monthly COBRA insurance premiums for participation in the life, health, dental and disability benefit programs of the Company in which the NEO participated as of the date of termination, payable monthly in accordance with the
Company'sCompany’s payroll practices. The terms of these payments are the following:
•Mr. Hill –Ms. Noonan—for up to 30 months.•Messrs.Brady,Harris andEvans –Gaskill and Mss. Anderson and MacMillan—for up to 24 months.(4)In the event of a Qualifying Change in Control Termination or a Change in Control, the amount reported assumes performance units are not continued, converted, assumed, or replaced by the Company or successor entity and therefore reflects full vesting at target.(5)- In addition, the
event ofamount reported assumes that thedeath of Messrs. Hill and Evans, in addition to amounts reported inCompensation Committee had not yet certified thetable above, Messrs. Hill and Evans will receive benefits from third-party payors under our employer-paid premium life insurance plans. If such benefits were triggered for Messrs. Hill and Evans on December 29, 2017 under our life insurance plans the legally designated beneficiary(ies) of Messrs. Hill and Evans would have received $1,500,000 and $952,000, respectively.Departure of Douglas C. RauhIn connection with the departure of Douglas C. Rauh, effective December 30, 2017, Mr. Rauh entered into the Agreement and Release with Summit Holdings and, solely for certain purposes specified therein, the Company, which provided for the following:•the payment of $1,100,000, payable in regular installments in accordance with Summit Holdings' normal payroll practices through December 31, 2019, representing 2 times his base salary for 2017;•the payment of $437,951, payable in accordance with Summit Holdings' normal payroll practices for annual bonuses, without regard to his departure date, representing his annual bonus with respect to fiscal year 2017;•monthly COBRA health continuation coverage premiums for up to 24 months following his departure date having an aggregate value equal to $28,872;•continued vesting of all outstanding unvested equity awards other than hisperformanceunits through the end of the Rauh Consulting Term (defined below); and•accelerated vesting, as of the last day of the Rauh Consulting Term, of all outstanding unvested equity awards other than his performance units, so long as the Rauh Consulting Term has not been voluntarily terminated by Mr. Rauh. Any accelerated options will not be exercisable prior to the date such options would have otherwise vested in accordance with the terms of the original award agreement, and will be exercisable for 90 days after such date, after which such options will be forfeited. A prorated portion of Mr. Rauh's outstanding performance units will remain eligible to vest at the endof the performance units with a performance period of 2019—2021, which subsequently resulted inaccordance with their terms, based on actual performance.
target.The payments and benefits provided for in the Agreement and Release were subjecta payout equal toMr. Rauh's execution and delivery200% ofa release of claims and his continued compliance with the non-competition, non-disparagement, non-solicitation and confidentiality covenants contained in his employment agreement. The non-disparagement and confidentiality covenants each have an indefinite term and the non-competition and non-solicitation covenants each have a term of 12 months following Mr. Rauh's departure.
Table of ContentsChief Executive Officer Pay RatioAdditionally, pursuant to the Agreement and Release, beginning on January 1, 2018, Mr. Rauh agreed to provide Summit Holdings with consulting services on a month-to-month basis, unless terminated earlier by either party with 10 business days' prior written notice (such applicable term, the "Rauh Consulting Term"). During the Rauh Consulting Term, Mr. Rauh will be entitled to (i) a monthly consulting fee of $15,000 and (ii) reimbursement of reasonable business expenses and wireless internet and cellular phone expenses incurred by Mr. Rauh in connection with his consulting services.CEO Pay RatioThe
CEOChief Executive Officer pay ratiofiguresfigure belowareis a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K under the Exchange Act.We determined thatLast year, we identified our median employee using our global employee population as of December5, 2017,31, 2020. There was no significant change in ourtotal number of full-employee population or compensation arrangement in 2021, andpart-time U.S. employees was 5,642 and non-U.S. employees was 265. We chose not to exclude any countries as permitted by SEC regulations, which resulted in 5,907 employees includedthere have been no changes in thecalculation.median employee’s circumstances during 2021, that we reasonably believe would result in a significant change in our pay ratio disclosure. Accordingly, we have used the same median employee we identified last year for purposes of calculating our CEO pay ratio for 2021. To determine our median employee pay last year, we chose taxable wages as our consistently applied compensation
measure. We then calculated an annual taxable wage for each employee, annualizing pay for those full-time or part-time permanent employees who commenced work during 2017 or who were on leave for a portion of 2017. We used a valid statistical sampling methodmeasure in order to identifythe group of employees within a 5% range of the estimated median level of taxable wages forouremployee population. The historical compensation of this group was then analyzed to identify amedian employeewhoseas of December 31, 2020.We calculated the median employee’s annual total compensationwas reasonably representative of the median annual total compensation in respect of 2017 and was also reasonably likely to remain representative of the median in future years. After identifying the median employee, we calculated the median employee's annual total compensationfor 2021 in accordance with the requirements of the Summary Compensation Table. For2017,2021, the medianemployee'semployee’s annual total compensation was$56,523$40,006 and the annual total compensation of our CEO was$4,490,470, which amount varies from his total compensation amount as reflected in the Summary Compensation Table because each of these amounts includes the value of non-discriminatory employer paid health benefits.$6,296,104. Accordingly, for2017,2021, the ratio of CEO pay to median employee pay was79:157:1.This pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules and the methodology described above. The SEC rules for identifying the median compensated employee and calculating the pay ratio based on suchemployee'semployee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.46 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTOUR AUDITORS ITEM 4RATIFICATION OF APPOINTMENT OF
KPMG LLP Under the rules and regulations of the SEC, the NYSE and the Public Company Accounting Oversight Board (the “PCAOB”), the Audit Committee is directly responsible for the appointment, compensation, retention and oversight of our independent registered public accounting firm. In addition, the Audit Committee considers the independence of our independent registered public accounting firm and participates in the selection of the independent registered public accounting firm’s lead engagement partner. The Audit Committee has appointed, and, as a matter of good corporate governance, is requesting ratification by our stockholders of the appointment of, the registered public accounting firm of KPMG to serve as independent registered public accounting firm for the fiscal year ending December 31, 2022. KPMG has served as our independent registered public accounting firm since 2012.The Board and the Audit Committee believe that the continued retention of KPMG as the Company’s independent registered public accounting firm is in the best interests of the Company and its stockholders. If stockholders do not ratify the selection of KPMG, the Audit Committee will evaluate the stockholder vote when considering the selection of a registered public accounting firm for the audit engagement for the 2021 fiscal year. In addition, even if stockholders ratify the selection of KPMG as independent registered public accounting firm, the Audit Committee may nevertheless periodically request proposals from the major registered public accounting firms and as a result of such process may select KPMG or another registered public accounting firm as our independent registered public accounting firm. THE BOARD RECOMMENDS A VOTE “FOR” RATIFICATION
OF THE APPOINTMENT OF KPMG AS OUR INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL
YEAR ENDING DECEMBER 31, 2022. 2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 47INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMTableRepresentatives ofContentsKPMG are expected to attend the Annual Meeting and will have an opportunity to make a statement and to respond to appropriate questions from stockholders.Consistent with SEC and PCAOB requirements regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation for and overseeing the work of, the independent registered public accounting firm. In recognition of this responsibility, the Audit Committee has established a policy to pre-approve all audit and permissible non-audit services provided by the independent registered public accounting firm.Prior to engagement of the independent registered public accounting firm for the next year’s audit, management will submit to the Audit Committee for approval a list of services and related fees expected to be rendered during that year within each of the following four categories of services:•Audit services include audit work performed on the financial statements and internal control over financial reporting, as well as work that generally only the independent registered public accounting firm can reasonably be expected to provide, including comfort letters, statutory audits and discussions surrounding the proper application of financial accounting and/or reporting standards.•Audit-Related services are for assurance and related services that are traditionally performed by the independent registered public accounting firm, including due diligence related to mergers and acquisitions, employee benefit plan audits and special procedures required to meet certain regulatory requirements.•Tax services include all services, except those services specifically related to the financial statements, performed by the independent registered public accounting firm’s tax personnel, including tax analysis; assisting with coordination of execution of tax-related activities, primarily in the area of corporate development; supporting other tax-related regulatory requirements; tax planning; and tax compliance and reporting.•All Other services are those services not captured in the Audit, Audit-Related or Tax categories.Prior to engagement, the Audit Committee pre-approves independent registered public accounting firm services within each category and the fees of each category are budgeted. The Audit Committee requires the independent registered public accounting firm and management to report actual fees versus the budget periodically throughout the year by category of service. During the year, circumstances may arise when it may become necessary to engage the independent registered public accounting firm for additional services not contemplated in the original pre-approval categories. In those instances, the Audit Committee requires specific pre-approval before engaging the independent registered public accounting firm.The Audit Committee may delegate pre-approval authority to one or more of its members. The member to whom such authority is delegated must report, for informational purposes only, any pre-approval decisions to the Audit Committee at its next scheduled meeting. All of the services in the table below were pre-approved by the Audit Committee.(in thousands) 2021 2020 Audit Fees(1) $ 3,640 $ 3,750 Tax Fees — — Audit-Related Fees — — All Other Fees — — Total $ 3,640 $ 3,750 (1)Represents the aggregate fees billed for professional services by KPMG for the audit of our financial statements, reviews of our quarterly financial statements and services associated with other SEC filings, including registration statements. Fees related to regulatory filings and comfort letters totaled 24,860 in 2021 and fees related to registration statement totaled $99,460 in 2020.48 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT
Director CompensationAUDIT COMMITTEE REPORT The Audit Committee reviews the Company’s financial reporting process on behalf of the Board. Management has the primary responsibility for establishing and maintaining adequate internal control over financial reporting, for preparing the financial statements, and for the reporting process. The Audit Committee members do not serve as professional accountants or auditors, and their functions are not intended to duplicate or to certify the activities of management and the independent registered public accounting firm. The Company’s independent registered public accounting firm is engaged to audit and report on the conformity of the Company’s financial statements to accounting principles generally accepted in the United States and the effectiveness of the Company’s internal control over financial reporting. In this context, the Audit Committee reviewed and discussed with management and the independent registered public accounting firm the audited financial statements for the year ended January 1, 2022 (the “Audited Financial Statements”), management’s assessment of the effectiveness of the Company’s internal control over financial reporting, and the independent registered public accounting firm’s evaluation of the Company’s system of internal control over financial reporting. The Audit Committee has discussed with the independent registered public accounting firm the matters required to be discussed by Public Company Accounting Oversight Board (the “PCAOB”) Auditing Standard No. 1301, Communications with Audit Committees. In addition, the Audit Committee has received the written disclosures and the letter from the independent registered public accounting firm required by applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence, and has discussed with the independent registered public accounting firm its independence. Based upon the reviews and discussions referred to above, the Audit Committee recommended to the Board that the Audited Financial Statements be included in the Company’s Annual Report on Form 10-K for the year ended January 1, 2022, for filing with the Securities and Exchange Commission. The Audit Committee Joseph S. Cantie
Susan A. Ellerbusch
John R. Murphy, Chair
Anne K. Wade Prior to 2017, we only paid compensation to directors who were not employed by us or Blackstone. Following the November 2016 secondary offering of Blackstone's shares of our Class A Common Stock, Blackstone ceased to hold any LP Units or shares of our Class A Common Stock. In connection with Blackstone's exit, the Board determined it was appropriate to begin paying compensation to directors who are employed by Blackstone, commencing with fiscal 2017.In 2017, all of the Company's non-employee directors (other than Ms. Julia Kahr) received annual cash compensation of $100,009. Ms. Kahr received cash compensation of $16,667 for her service prior to her resignation from the Board effective February 28, 2017. The chairperson of the Board received an additional $150,000 in cash compensation and the respective chairpersons of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee (unless such chairperson is also the chairperson of the Board) receive an additional $15,000, $10,000 and $10,000, respectively. Directors who were not employed by us may also receive compensation, from time to time, for service on any special committees of the Board. We reimburse our directors for any reasonable expenses incurred by them in connection with services provided in such capacity.In addition, during 2017, all of the Company's non-employee directors (other than Ms. Kahr) received an annual award of RSUs valued at $99,991. A grant of 4,098 RSUs was made to each of Messrs. Lance, Cantie, Gardner, Murphy, Simpkins, and Wunning and Ms. Wade, on February 28, 2017. The RSUs were granted under the Omnibus Incentive Plan, and the terms thereof are outlined in the table below. Further, the RSU awards are subject to the Company's clawback policy, as in effect from time to time.Award TypeVestingTermination or Change in Control ProvisionsRSUsVest on the firstanniversary of the date ofgrant•Death or Disability / By the Company Without Cause: Unvested portion will immediately vest.•Retirement(1)/ Declining to Stand for Re-election to Our Board(2): Prorated portion immediately vests; settled at such time as would have been settled according to the original vesting schedule.•Change in Control: Accelerated only if not continued, converted, assumed or replaced by the Company or successor entity.•By the Company For Cause: Vested and unvested portions are forfeited.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 49(1)"Retirement" is defined in the director form of RSU award agreement as a director's resignation from service on our Board (other than due to death or disability or termination by the Company without cause) prior to the expiration of such director's term and on or after the date such director attains age 70.(2)In each case, as of or after the regular annual meeting of stockholders for the calendar year which includes the date of grant.
Director Compensation TableThe table below summarizes the compensation paid to non-employee directors for the year ended December 30, 2017.OUR RELATIONSHIPSName Fees Earned or
Paid in CashStock
Awards(1)Option
Awards(2)Total
CompensationHoward L. Lance(3)
$ 250,009 $ 99,991 $ — $ 350,000 Joseph S. Cantie
100,009 99,991 — 200,000 Ted A. Gardner
100,009 99,991 — 200,000 John R. Murphy
115,009 99,991 — 215,000 Neil P. Simpkins
110,009 99,991 — 210,000 Anne K. Wade
100,009 99,991 — 200,000 Steven H. Wunning
100,009 99,991 — 200,000 Julia C. Kahr(4)
16,667 — — 16,667 (1)The amounts reported in the Stock Awards column reflect the aggregate grant date fair value of RSUs granted in fiscal 2017, computed in accordance with ASC 718, utilizing the assumptions discussed in Note 13,Stock-Based Compensation, to our audited consolidated financial statements included in the 2017 Annual Report. As of December 30, 2017, the aggregate number of unvested RSUs held by our directors was as follows: Mr. Lance, 4,098 RSUs; Mr. Cantie, 4,098 RSUs; Mr. Gardner, 4,098 RSUs; Mr. Murphy, 4,098 RSUs; Mr. Simpkins, 4,098 RSUs; Ms. Wade, 4,098 RSUs; and Mr. Wunning, 4,098 RSUs. As of December 30, 2017, Mr. Lance held 44,296 unvested LP Units. Time-vesting LP Units held by our directors vest 20% on the first anniversary of the legacy Class D 1 interests' grant date and the remaining 80% vest monthly over the four years following the first anniversary.(2)We did not make any option awards to directors in fiscal 2017. As of December 30, 2017, Messrs. Lance and Murphy held 246,611 and 10,220 time-vesting Leverage Restoration Options, respectively. Time-vesting Leverage Restoration Options held by our directors have the same vesting terms as those held by our NEOs and described in "Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Pre-IPO Long-Term Incentive Awards." As of December 30, 2017, a limited liability company controlled by Mr. Gardner held 27,408 warrants, which became exercisable on March 17, 2016.(3)Since Mr. Lance is the chairperson of the Board, he does not receive additional fees for his service as chairperson of the Nominating and Corporate Governance Committee.(4)Ms. Kahr resigned from the Board effective February 28, 2017.
Exchange AgreementIn connection with the IPO, we entered into an Exchange Agreement with the holders of LP Units pursuant to which each holder of LP Units (and certain permitted transferees thereof) may, subject to the terms of the Exchange Agreement, exchange their LP Units for shares of Class A Common Stock on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications. The Exchange Agreement also provides that a holder of LP Units will not have the right to exchange LP Units if the Company determines that such exchange would be prohibited by law or regulation or would violate other agreements with the Company or its subsidiaries to which such holder may be subject. The Company may impose additional restrictions on exchange that it determines to be necessary or advisable so that Summit Holdings is not treated as a
"publicly“publicly tradedpartnership"partnership” for U.S. federal income tax purposes. As a holder exchanges LP Units for shares of Class A Common Stock, the number of LP Units held by the Company is correspondingly increased as it acquires the exchanged LP Units. In accordance with the Exchange Agreement, any holder who surrenders all of its LP Units for exchange must concurrently surrender all shares of Class B Common Stock held by it (including fractions thereof) to the Company.Registration Rights AgreementIn connection with the IPO, we entered into a registration rights agreement with our pre-IPO owners and the former holders of Class B Units of Continental Cement Company, L.L.C. (the "Former CCC Minority Holders") pursuant to which we granted them, their affiliates and certain of their transferees the right, under certain circumstances and subject to certain restrictions, to require us to register under the Securities Act of 1933, as amended (the "Securities Act"), the offering of shares of Class A Common Stock delivered in exchange for LP Units. Under the registration rights agreement, we agreed to register the exchange of LP Units for shares of Class A Common Stock by our pre-IPO owners. In addition, Blackstone had the right to request an unlimited number of "demand" registrations and had customary "piggyback" registration rights. The Former CCC Minority Holders had the right to request one "demand" registration and had customary piggyback registration rights.Tax Receivable AgreementIn connection with the IPO, we entered into a tax receivable agreement with the holders of LP Units that provides for the payment to exchanging holders of LP Units of 85% of the benefits, if any, that the Company is deemed to realize as a result of the increases in tax basis resulting from exchanges of LP Units and certain other tax benefits related to entering into the tax receivable agreement, including tax benefits attributable to payments under the tax receivable agreement. Certain current and former holders of LP Units, who include certain of our executive officers and directors, are expected to receive payments under the tax receivable agreement in the future. The increases in tax basis as a result of an exchange of LP Units for shares of Class A Common Stock, as well as the amount and timing of any payments
under the tax receivable agreement, are difficult to accurately estimate as they will vary depending upon a number of factors, including:
•the timing ofexchangesexchanges——for instance, the increase in any tax deductions will vary depending on the fair market value, which may fluctuate over time, of the depreciable or amortizable assets of Summit Holdings at the time of each exchange;••the price of shares of our Class A Common Stock at the time of theexchangeexchange——the increase in any tax deductions, as well as the tax basis increase in other assets, of Summit Holdings, is directly proportional to the price of shares of our Class A Common Stock at the time of the exchange;••the extent to which such exchanges aretaxabletaxable——if an exchange is not taxable for any reason, increased deductions will not be available;••the amount and timing of our income—the Company is required to pay 85% of the cash tax savings as and when realized, if any. If the Company does not have taxable income, the Company is not required (absent a change of control or circumstances requiring an early termination payment) to make payments under the tax receivable agreement for that taxable year because no cash tax savings will have been realized. However, any tax attributes that do not result in realized benefits in a given tax year will likely generate tax attributes that may be utilized to generate benefits in previous or future tax years. The utilization of such tax attributes will result in cash tax savings that will result in payments under the tax receivable agreement; and••the effective tax rate—the benefit that the Company realizes is dependent on the tax rate in effect at the time taxable income is generated.For example, at the end of 2017, the Tax Cuts and Jobs Act was enacted into law. Among other things, the federal corporate tax rate was reduced from 35% to 21%. As a result, the value of the additional benefits generated from the exchanges was reduced, and therefore, the tax receivable agreement liability recorded by the Company was also reduced.50 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTWe anticipate funding payments under the tax receivable agreement from cash flows from operations, available cash and available borrowings under our senior secured revolving credit facilities. As ofDecember 30, 2017,January 1, 2022, we had accrued$331.9$326.5 million as a tax receivable agreement liability.Other than $0.6 million which was paid in January 2018, theThe tax receivable agreement liability is along termlong-term liability as no additional payments are expected in the next twelve months.In addition, the tax receivable agreement provides that upon certain changes of control, theCompany'sCompany’s (or itssuccessor's)successor’s) obligations would be based on certain assumptions, including that the Company would have sufficient taxable income to fully utilize the deductions arising from the tax deductions, tax basis and other tax attributes subject to the tax receivable agreement. With respect to our obligations under the tax receivable agreement relating to previously exchanged or acquired LP Units and certain net operating losses, we would be required to make a payment equal to the present value (at a discount rate equal to one year LIBOR plus 100 basis points) of the anticipated future tax benefits determined using assumptions (ii) through (v) of the following paragraph.Furthermore, the Company may elect to terminate the tax receivable agreement early by making an immediate payment equal to the present value of the anticipated future cash tax savings. In determining such anticipated future cash tax savings, the tax receivable agreement includes several assumptions,including that (i) any LP Units that have not been exchanged are deemed exchanged for the market value of the shares of Class A Common Stock at the time of termination, (ii) the Company will have sufficient taxable income in each future taxable year to fully realize all potential tax savings, (iii) the Company will have sufficient taxable income to fully utilize any remaining net operating losses subject to the tax receivable agreement on a straight line basis over the shorter of the statutory expiration period for such net operating losses or the five-year period after the early termination or change of control, (iv) the tax rates for future years will be those specified in the law as in effect at the time of termination and (v) certain non-amortizable assets are deemed disposed of within specified time periods. In addition, the present value of such anticipated future cash tax savings
areis discounted at a rate equal to LIBOR plus 100 basis points.Under the terms of the tax receivable agreement, the Company can terminate the tax receivable agreement at any time, which would trigger a cash payment to the pre-IPO owners. Based upon a$31.44$40.14 per share price of our Class A common stock, the closing price of our stock on December30, 201731, 2021 (the last business day of our fiscal year) and a contractually defined discount rate of3.11%1.58%, the Company estimates that if it were to exercise its right to terminate the tax receivable agreement, the aggregate amount required to settle the tax receivable agreement would be approximately$282$312 million.Summit Materials Holdings L.P. Amended and Restated Limited Partnership AgreementThe Company holds LP Units in Summit Holdings and is the sole general partner of Summit Holdings. Accordingly, the Company operates and controls all of the business and affairs of Summit Holdings and, through Summit Holdings and its operating entity subsidiaries, conducts our business.
Pursuant to the limited partnership agreement of Summit Holdings, the Company has the right to determine when distributions will be made to holders of LP Units and the amount of any such distributions. If a distribution is authorized, such distribution will be made to the holders of LP Units pro rata in accordance with the percentages of their respective limited partnership interests.No distributions will be made in respect of unvested LP Units and instead such amounts will be distributed to holders of vested LP Units pro rata in accordance with their vested interests. If, from time to time, an unvested LP Unit becomes vested, then, on the next distribution date, all amounts that would have been distributed pro rata in respect of that LP Unit if it had been vested on prior distribution dates will be required to be "caught up" in respect of that LP Unit before any distribution is made in respect of other vested LP Units.The holders of LP Units, including the Company, incur U.S. federal, state and local income taxes on their share of any taxable income of Summit Holdings. The limited partnership agreement of Summit Holdings provides for tax distributions to the holders of the LP Units in an amount generally calculated to provide each holder of LP Units with sufficient cash to cover its tax liability in respect of the LP Units. These tax distributions are generally only paid to the extent that other distributions made by Summit Holdings were otherwise insufficient to cover the estimated tax liabilities of all holders of LP Units. In general, these tax distributions are computed based on our estimate of the net taxable income
Holdings.of Summit Holdingsallocated toeach holder of LP Unitsthe Company multiplied by an assumed tax rate equal to the highest effective marginal combined U.S. federal, state and local income tax rate applicable toan individual ora corporate resident in New York, NewYork (or a corporate resident in certain circumstances).York. In the year endedDecember 30, 2017,January 1, 2022, Summit LLCpaiddid not make any distributions to SummitHoldings totaling $49.7 million, of which $1.8 million was distributed to Summit Holdings' partners, other than the Company, and of which $47.9 million was paid to the Company.The limited partnership agreement of Summit Holdings also provides that substantially all expenses incurred by or attributable to the Company, but excluding obligations incurred under the tax receivable agreement by the Company, income tax expenses of the Company and payments on indebtedness incurred by the Company, will be borne by Summit Holdings.
The Company as the general partner may (i) at any time, require all holders of LP Units, other than holders who are current employees or service providers, to exchange their units for shares of our common stock or (ii) with the consent of partners in Summit Holdings whose vested interests exceed 66 2/3% of the aggregate vested interests in Summit Holdings, require all holders of interests in Summit Holdings to transfer their interests, provided that the prior written consent of each holder that is an affiliate of Blackstone affected by any such proposed transfer will be required. These provisions are designed to ensure that the general partner can, in the context of a sale of the Company, sell Summit Holdings as a wholly-owned entity subject to the approval of the holdersthereof, including specific approval by any Blackstone affiliates then holding such units. For so long as affiliates of Blackstone collectively owned at least 5% of the outstanding LP Units, the consent of each Blackstone holder was required to amend the limited partnership agreement.thereof.
Indemnification AgreementsWe have entered into indemnification agreements with our directors and executive officers. These agreements require us to indemnify these individuals to the fullest extent permitted by Delaware law against liabilities that may arise by reason of their service
2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 51to us, and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors or executive officers, we have been informed that in the opinion of the SEC such indemnification is against public policy and is therefore unenforceable.There is currently no pending material litigation or proceeding involving any of our directors, officers or employees for which indemnification is sought.Warrant IssuancesIn connection with the modification of the capital structure of Summit Holdings at the time of our IPO, we issued warrants to purchase an aggregate of 160,333 shares of Class A Common Stock to limited partners of Summit Holdings who held Class C limited partnership interests of Summit Holdings. Holders of the Class C limited partnership interests include Thomas W. Hill, a limited liability company controlled by Ted A. Gardner, and Michael J. Brady, who received warrants to purchase 29,463, 27,408, and 6,852 shares of Class A Common Stock, respectively. The warrants were issued in substitution for part of the economic benefit of the Class C interests that was not reflected in the conversion of the Class C interests to LP Units. The exercise price of the warrants is equal to the IPO price of $18.00 per share. The warrants became exercisable from and after March 17, 2016 and will expire on March 11, 2025.OtherThomas A. Beck, the President of our Cement Division, through the Thomas A. Beck Family, LLC (the "Beck LLC"), is a party to a Contribution and Purchase Agreement, dated December 18, 2014 that we entered into with the Former CCC Minority Holders (the "Contribution andPurchase Agreement"). In connection with the Contribution and Purchase Agreement, on March 17, 2015, Summit Holdings issued to the Former CCC Minority Holders $15.0 million in aggregate principal amount of non-interest bearing notes payable over six years. The pro rata share of the $15.0 million in notes that is due to the Beck LLC is $208,344, payable in six equal annual installments of $34,724 on each anniversary of March 17, 2015. During 2017, the second installment on the notes was paid to the Beck LLC. In addition, during 2017, tax distributions to the Beck LLC in connection with Mr. Beck's interest in the Contribution and Purchase Agreement totaled $12,160.Statement of Policy Regarding Transactions with Related Persons
We have adopted a written statement of policy regarding transactions with related persons, which we refer to as our"related“related person policy."” Our related person policy requires that a"related person" (as“related person” (as defined in paragraph (a) of Item 404 of Regulation S-K) must promptly disclose to our Chief Legal Officer any"related“related persontransaction" (definedtransaction” (defined as any transaction that is anticipated would be reportable by us under Item 404(a) of Regulation S-K in which we were or are to be a participant and the amount involved exceeds $120,000 and in which any related person had or will have a direct or indirect material interest) and all material facts with respect thereto. The Chief Legal Officer will then promptly communicate that information to our Board. No related person transaction will be executed without the approval or ratification of an approving body that shall be composed solely of independent directors who are disinterested in the transaction. Currently, our Boardor a duly authorized committeehas designated the members ofour Board.the Audit Committee as the approving body. It is our policy that directors interested in a related person transaction will recuse themselves from any vote on a related person transaction in which they have an interest.52 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTOUR STOCKHOLDERSHOLDINGS OF MAJOR STOCKHOLDERSTableThe following table sets forth the beneficial ownership ofContentsSECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCEToshares of ourknowledge, based solely on a reviewClass A Common Stock and LP Units by (1) each person known to us to beneficially own more than 5% of any class of thecopiesoutstanding voting securities ofsuch reports furnished to us and written representations that no other reports were required, we believe that duringthefiscal year ended December 30, 2017,Company, (2) each of ourofficers,directors andgreater-than-10% stockholders timely filedNEOs and (3) allreports requiredof our directors and executive officers as a group as of March 21, 2022. Class A Common Stock(1) LP Units(1) Combined Voting Power(2) Stockholder Name Number Percent Number Percent Number Percent The Vanguard Group, Inc.(3) 11,145,582 9.3 — — 11,145,582 9.2 BlackRock, Inc.(4) 8,974,433 7.5 — — 8,974,433 7.4 T. Rowe Price Associates, Inc. (5) 8,886,942 7.4 — — 8,886,942 7.4 FMR LLC(6) 7,951,538 6.7 — — 7,951,538 6.6 Capital International Investors(7) 6,384,589 5.3 — — 6,384,589 5.3 Anne P. Noonan (8) 93,197 * — — 93,197 * Howard L. Lance(9) 89,979 * 45,772 * 135,751 * Joseph S. Cantie(10) 35,763 * — — 35,763 * Anne M. Cooney(11) 22,996 * — — 22,926 * Susan A. Ellerbusch(12) 22,996 * — — 22,996 * John R. Murphy(13) 23,436 * 4,274 * 27,710 * Anne K. Wade(14) 23,014 * — — 23,014 * Steven H. Wunning(15) 30,640 * — — 30,640 * Tamala Oates-Forney(16) 4,054 * — — 4,054 * Brian J. Harris(17) 203,059 * 332,699 * 535,758 * Karli S. Anderson(18) 10,033 * — — 10,033 * Christopher B. Gaskill(19) 25,537 * — — 25,537 * Deon MacMillan(20) 10,163 * — — 10,163 * All Directors and Executive Officers as a Group (13 persons)(21) 594,867 * 382,745 * 977,612 * Anne P. Noonan Brian J. Harris Karli S. Anderson Christopher B. Gaskill Deon MacMillan *Less than 1%.The percentage of beneficial ownership of (1) Class A Common Stock is based upon 119,548,709 shares issued and outstanding and (2) LP Units is based upon 120,862,715 LP Units outstanding (including 119,548,709 LP Units held bySection 16(a)the Company), in each case as of March 21, 2022. Percentage of combined voting power is based upon 120,862,715 votes represented by outstanding securities, consisting of (1) 119,548,709 shares of Class A Common Stock issued and outstanding and (2) 1,314,006 LP Units outstanding and eligible to vote, excluding LP Units held by the Company, in each case as of March 21, 2022. The Company is the general partner of Summit Holdings, which indirectly owns 100% of the limited liability interests of Summit Materials, LLC (“Summit LLC”). Except as otherwise noted, (i) the information is as of March 21, 2022, and (ii) the address of each beneficial owner is c/o Summit Materials, Inc., 1550 Wynkoop Street, 3rd floor, Denver, Colorado 80202. Beneficial ownership is determined in accordance with the rules and regulations of the SEC.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 53(1)Subject to the terms of the ExchangeAct,Agreement, LP Units are exchangeable for shares of our Class A Common Stock on a one-for-one basis. See “Certain Relationships and Related Person Transactions — Exchange Agreement.” Beneficial ownership of LP Units reflected in this table is not reflected as beneficial ownership of shares of our Class A Common Stock for which such units may be exchanged. See “Executive Compensation — Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table — Pre-IPO Long-Term Incentive Awards (Value From Modifications to Eliminate Misalignment Post-IPO)” for a description of the LP Units.(2)Represents percentage of voting power of the Class A Common Stock and Class B Common Stock of the Company voting together as a single class and gives effect to voting power of the Class B Common Stock, excluding options that are vested or will vest within 60 days as well as outstanding warrants. The Class B Common Stock provides holders who also hold LP Units with a number of votes that is equal to the aggregate number of LP Units held by such holders. As of March 21, 2022, holders of the LP Units held all of the issued shares of our Class B Common Stock that were outstanding and the total number of votes that were represented by the Class B Common Stock was 1,314,006.(3)The number of shares held was obtained from the holder’s Schedule 13G/A filing with theexceptionSEC on February 10, 2022, which reports ownership as of December 31, 2021. The Schedule 13G/A filing indicates that the holder, The Vanguard Group, Inc. (“Vanguard”) has shared power to vote or direct the vote of 96,388 shares of our Class A Common Stock, sole power to dispose or direct the disposition of 10,944,138 shares of our Class A Common Stock, and shared power to dispose or direct the disposition of 201,444 shares of our Class A Common Stock. The address of Vanguard is 100 Vanguard Blvd., Malvern, PA 19355.(4)The number of shares held was obtained from the holder’s Schedule 13G/A filing with the SEC on February 3, 2022, which reports ownership as of December 31, 2021. The Schedule 13G/A filing indicates that the holder, BlackRock, Inc. (“BlackRock”) had sole power to vote or direct the vote of 8,640,952 shares of our Class A Common Stock and sole power to dispose or to direct the disposition of 8,974,433 shares of our Class A Common Stock. The address of BlackRock is 55 East 52nd Street, New York, NY 10055.(5)The number of shares held was obtained from the Schedule 13G/A filing made by T. Rowe Price Associates, Inc. (“T. Rowe Price”) with the SEC on February 14, 2022, which reports ownership as of December 31, 2021. The Schedule 13G/A indicates that T. Rowe Price has sole power to vote or direct the vote of 3,381,175 shares of our Class A Common Stock and sole power to dispose or direct the disposition of 8,886,942 shares of our Class A Common Stock. The address of T. Rowe Price is 100 E. Pratt Street, Baltimore, Maryland 21202.(6)The number of shares held was obtained from the Schedule 13G/A filing made by FMR LLC (“FMR”) and Abigail P. Johnson with the SEC on February 9, 2022, which reports ownership as of December 31, 2021. The Schedule 13G/A indicates that FMR has sole power to vote or direct the vote of 2,776,161 shares of our Class A Common Stock and sole power to dispose or direct the disposition of 7,951,538 shares of our Class A Common Stock. The Schedule 13G/A indicates that Ms. Johnson has sole power to dispose or direct the disposition of 7,951,538 shares of our Class A Common Stock. Members of the Johnson family, including Ms. Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders’ voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940 (the “Investment Act”), to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Abigail P. Johnson has the sole power to vote or direct the voting of the shares owned directly by the various investment companies registered under the Investment Company Act (“Fidelity Funds”) advised by Fidelity Management & Research Company (“FMR Co”), a wholly owned subsidiary of FMR LLC, which power resides with the Fidelity Funds’ Boards of Trustees. FMR Co carries out the voting of the shares under written guidelines established by the Fidelity Funds’ Boards of Trustees. The address of FMR is 245 Summer Street, Boston, Massachusetts 02210.(7)The number of shares held was obtained from the Schedule 13G filing made by Capital International Investors (“Capital”) with the SEC on February 11, 2022, which reports ownership as of December 31, 2021. The Schedule 13G indicates that Capital has sole power to vote or direct the vote of 6,384,589 shares of our Class A Common Stock and sole power to dispose or direct the disposition of 6,384,589 shares of our Class A Common Stock. The address of Capital is 333 South Hope Street, 55th Fl, Los Angeles, CA 90071.(8)Includes 93,197 shares of our Class A Common Stock owned by Ms. Noonan.(9)Includes (i)one Form 481,611 options issued to Mr. Lance thatwas inadvertently not filed to reportare vested or will vest within 60 days, (ii) 45,772 LP Units held by Mr. Lance, and (iii) 8,368 shares of our Class A Common Stock held by Mr. Lance.(10)Includes (i) 30,663 shares of our Class A Common Stock owned by Mr. Cantie directly and (ii) 5,100 shares of our Class A Common Stock held by a trust for theawardbenefit of Mr. Cantie, for which Mr. Cantie and his spouse serve as trustees.(11)Includes (i) 9,716 restricted stock units that are vested and the reporting person has elected toJoseph S. Cantie on February 28, 2017, which award was subsequently disclosed on a Form 5 filed on February 8, 2018,defer settlement and (ii)one Form 413,280 shares of our Class A Common Stock owned by Ms. Cooney.(12)Includes 22,996 shares of our Class A Common Stock owned by Ms. Ellerbusch.(13)Includes (i) 10,220 options issued to Mr. Murphy thatwas inadvertently not filed to report the awardare vested or will vest within 60 days, (ii) 4,274 LP Units held by Mr. Murphy and (iii) 13,216 shares of our Class A Common Stock owned by Mr. Murphy.(14)Includes (i) 4,374 restricted stock units that are vested and the reporting person has elected toSteven H. Wunning on February 28, 2017, which award was subsequently disclosed on a Form 5 filed on February 8, 2018,defer settlement and (ii) 18,640 shares of our Class A Common Stock owned by Ms. Wade.(15)Includes 30,640 shares of our Class A Common Stock owned by Mr. Wunning.(16)Includes 4,054 restricted stock units that will vest within 60 days owned by Ms. Oates-Forney.(17)Includes (i) 19,216 options issued to Mr. Harris that are vested or will vest within 60 days, (ii) 183,843 shares of our Class A Common Stock owned by Mr. Harris, and (iii)Form 4/As filed332,699 LP Units held by The Harris Family 2014 Trust fbo Michael J. Harris and The Harris Family 2014 Trust fbo Cameron I.J. Harris, trusts for which Mr. Harris’ spouse serves as trustee and as to which Mr. Harris could be deemed to have beneficial ownership.(18)Includes 10,033 shares of our Class A Common Stock owned by Ms. Anderson.(19)Includes (i) 1,536 options that are vested or will vest within 60 days and (ii) 24,001 shares of our Class A Common Stock owned by Mr. Gaskill.(20)Includes (i) 6,452 restricted stock units that will vest within 60 days and (ii) 3,711 shares of our Class A Common Stock owned by Ms. MacMillan.(21)Includes (i) 112,583 options that are vested or will vest within 60 days, (ii) 10,506 restricted stock units that will vest within 60 days, (iii) 382,745 LP Units, (iv) 14,090 restricted stock units that are vested and the reporting person has elected to defer settlement and (v) 457,688 shares of our Class A Common Stock.54 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTUSERS’ GUIDEInformation Referenced in This Proxy StatementThe content of the websites referred to in this proxy statement are not deemed to be part of, and are not incorporated by reference into, this proxy statement.Attending the Annual Meeting of StockholdersWHO CAN ATTEND THE ANNUAL MEETING?You are entitled to attend the Annual Meeting on Wednesday, May 18, 2022 only if you were a Summit Materials stockholder at the close of business on March28, 201723, 2022, or you hold a valid proxy. No cameras, recording equipment, laptops, tablets, cellular telephones, smartphones, or other similar equipment, electronic devices, large bags, briefcases or packages will be permitted, and security measures will be in effect to provide for the safety of attendees.HOW CAN I ATTEND THE ANNUAL MEETING?To attend the Annual Meeting physically, you will need proof of ownership of Summit Materials stock to enter the meeting. If your shares are in the name of your broker or bank or you received your materials electronically, you will need to bring evidence of your stock ownership, such as your most recent brokerage statement and a “legal proxy” from the bank, brokerage firm or other nominee thatcorrectedhold your shares, in order to enter theForm 4s timely filedmeeting. Everyone will be required to present a valid picture ID in order to enter the meeting.To attend the Annual Meeting via the virtual web conference, please go to www.virtualshareholdermeeting.com/SUM2022 and enter the control number found on your proxy card, voting instruction form or notice you received.As always, we encourage you to vote your shares prior to the Annual Meeting. We have designed our hybrid format to enhance stockholder access, participation and communication. During the live Q&A session of the Annual Meeting, we may answer questions as they come in, to the extent relevant to the business of the Annual Meeting, as time permits. If you encounter any difficulties accessing the virtual web conference of the Annual Meeting, please call the numbers listed on the login page. Technical support will be available beginning 15 minutes before the start of the meeting and through the conclusion of the Annual Meeting.HOW CAN I ACCESS THE ANNUAL MEETING VOTING WEBSITE?All stockholders can visit the Annual Meeting voting website at www.proxyvote.com. On our Annual Meeting voting website, you can vote your proxy, access copies of our Proxy Statement and Annual Report and other information about Summit Materials, and elect to view future proxy statements and annual reports online instead of receiving paper copies in the mail.IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SUMMIT MATERIALS, INC.ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON WEDNESDAY, MAY 18, 2022THIS NOTICE, OUR PROXY STATEMENT, AND OUR COMBINED ANNUAL REPORT AND ANNUAL REPORT ON
FORM 10-K FOR THE YEAR ENDED JANUARY 1, 2022 ARE AVAILABLE AT WWW.PROXYVOTE.COM.2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 55Who Can Vote and HowWHO IS ENTITLED TO VOTE?You are entitled to vote at the Annual Meeting on Wednesday, May 18, 2022 only if you were a Summit Materials stockholder of record of our Class A Common Stock and Class B Common Stock (each such designation having par value $0.01 per share) at the close of business on March2, 201723, 2022.On March 23, 2022, we had 119,548,726 shares of Class A Common Stock outstanding and entitled to vote and 99 shares of Class B Common Stock outstanding and entitled to vote. Holders of shares of our Class A Common Stock and Class B Common Stock vote together as a single class on all matters on which stockholders are entitled to vote generally (except as may be required by law).Each share of Class A Common Stock is entitled to one vote for each director nominee and one vote for each other item to be voted on at the Annual Meeting. All of the shares of our outstanding Class B Common Stock are currently held by our pre-IPO investors, including certain members of management or their family trusts thatinadvertently misstateddirectly hold LP Units. A holder of Class B Common Stock is entitled, without regard to the number ofstock options grantedshares of Class B Common Stock held by such holder, toThomas W. Hill, Thomas A. Beck, Anne Lee Benedict, Michael J. Brady, M. Shane Evans, Brian J. Harris, Damian J. Murphy, and Douglas C. Rauh.The accompanying proxya number of votes that issolicitedequal to the aggregate number of LP Units held byand on behalfsuch holder. As of theBoard,record date, the total number of LP Units to which the voting power of the Class B Common Stock relates was 1,314,006.A majority of the voting power of Class A Common Stock and Class B Common Stock entitled to vote, present in person or represented by proxy, constitutes a quorum for the transaction of business at the Annual Meeting. Abstentions and broker non-votes will be included in determining the presence of a quorum at the Annual Meeting.HOW DO I VOTE?We encourage you to vote your shares in advance of the Annual Meeting, even if you plan on attending the Annual Meeting. If you have already voted prior to the Annual Meeting, you may nevertheless change or revoke your vote at the Annual Meeting.Vote your shares as follows. In all cases, have your Notice of Internet Availability of Proxy Materials, proxy card or voting instruction form in hand and follow the instructions.•Vote by Internet. Visit www.proxyvote.com 24/7 to vote by internet using your computer.•Vote by Telephone. Stockholders of record can call toll-free 800-690-6903 24/7 to vote. For beneficial stockholders, please see the voting instruction form 24/7 to vote.•Vote by Mail. If you elected to receive a hard copy of your proxy materials, fill out the enclosed proxy card, date and sign it, and return it in the enclosed postage paid envelope.•Vote During the Annual Meeting via the Internet. You may attend the Annual Meeting via the Internet and vote during the meeting. Go to www.virtualshareholdermeeting.com/SUM2022, enter the control number found on your proxy card, voting instruction form or notice you received, and follow the instructions available on the meeting website during the meeting.We encourage you to register to receive all future stockholder communications electronically, instead of in print. This means that, after you register, access to the annual report, proxy statement, and other correspondence will be delivered to you via e-mail.CAN I CHANGE MY VOTE?If you own common stock of record, you may change your vote at any time before the polls close at the Annual Meeting. You can do this by:•Voting again by Internet or telephone prior to 11:59 p.m. Eastern Time on May 17, 2022;•Signing another proxy card with a later date and returning it prior to the Annual Meeting; or•Voting again during the Annual Meeting.A stockholder owning common stock in street name may revoke or change voting instructions by contacting the bank, brokerage firm or other nominee holding the shares or by obtaining a legal proxy from such institution and voting in person at the Annual Meeting.WHO COUNTS THE VOTES?We have hired Broadridge Financial Solutions, Inc. to count the votes represented by proxies and cast by ballot, and Broadridge Financial Solutions, Inc. has been appointed to act as Inspector of Election.56 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTWHEN WILL THE VOTING RESULTS BE ANNOUNCED?We will announce the preliminary voting results during the Annual Meeting. We will report the final results on our website and in a Current Report on Form 8-K filed with the SEC within four days following the meeting.WILL MY VOTE BE CONFIDENTIAL?All stockholder proxies, ballots and tabulations that identify stockholders will be maintained in confidence. No such document will be available for examination, and thecostidentity and vote ofsuch solicitationany stockholder will not be disclosed, except as necessary to meet legal requirements and to allow the inspectors of election to certify the results of the vote.Business Taking Place at the Annual MeetingWHICH PROPOSALS ARE BEING VOTED ON AT THE ANNUAL MEETING?•The election of each of the three nominees to the Board named herein;•The approval, on a nonbinding advisory basis, of the compensation of our NEOs, as disclosed herein; and•The approval, on a nonbinding advisory basis, as to whether the nonbinding advisory vote on the approval of the compensation of our NEOs should be held every year, every two years, or every three years; and•The ratification of the appointment of KPMG as our independent registered public accounting firm.WHICH PROPOSALS ARE “ROUTINE” AND WHICH ARE “NON-ROUTINE”?The ratification of KPMG LLP as our independent registered public accounting firm for our fiscal year ending December 31, 2022 is the only routine matter to be presented at the Annual Meeting. The other two matters are non-routine and brokers will not be allowed to vote on these proposals without specific voting instructions from beneficial owners. We do not expect any additional matters will bebornebrought before the Annual Meeting. However, if other matters are properly presented, the persons named as proxies in the proxy card or their substitutes will vote in their discretion.HOW MANY VOTES ARE NEEDED TO APPROVE EACH PROPOSAL?With respect to the election of directors, a nominee for director shall be elected to the Board by a plurality of theCompany. Solicitationsvotes cast in respect of the shares of common stock present in person or represented by proxy at the Annual Meeting and entitled to vote on the election of directors. A plurality vote requirement means that the director nominees with the greatest number of votes cast “FOR”, even if it is less than a majority, will be elected. You may vote “FOR” or “WITHHOLD” with respect to each nominee. A withhold vote in the election of directors will have the same effect as an abstention. Neither a withhold vote nor a broker non-vote will affect the outcome of the election of directors.The affirmative vote of a majority of the voting power of common stock present in person or represented by proxy and entitled to vote on the matter is required to (i) ratify the appointment of KPMG as our independent registered public accounting firm and (ii) approve, on a nonbinding advisory basis, the compensation of our NEOs, as disclosed in this Proxy Statement. You may vote “FOR,” “AGAINST,” or “ABSTAIN” with respect to these matters. For these matters, abstentions are not counted as affirmative votes but are counted as present at the Annual Meeting and entitled to vote and will have the effect of a vote “against” the matter. Broker non-votes, if any, will have no effect on the outcome of these matters. With respect to the frequency of a nonbinding advisory stockholder vote on the compensation of our NEOs (Item 4), you may vote “ONE YEAR”, “TWO YEARS”, “THREE YEARS”, or “ABSTAIN”. Abstentions and broker non-votes, if any, will have no effect on the outcome of this matter.ProxiesWHO IS SOLICITING MY PROXY?The Board of Summit Materials is soliciting your proxy to vote at the 2022 Annual Meeting of Stockholders.HOW CAN I REVOKE MY PROXY?You can revoke your proxy by sending written notice of revocation to our Chief Legal Officer & Secretary at Summit Materials, Inc., 1550 Wynkoop Street, 3rd Floor, Denver, Colorado 80202, by May 17, 2022.WHAT IS THE COST OF THIS PROXY SOLICITATION?The Company will pay the costs of preparing, printing, assembling, and mailing the proxy materials used in the solicitation of proxies. Solicitation may be made bymail, personal interview, telephone, and electronic communications byour directors, officers, andother Companyemployeeswithoutby mail, email, telephone, or in person. Those individuals2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 57will receive no additionalcompensation.compensation for solicitation activities. We have hiredOkapi Partners LLCInnisfree M&A Incorporated to assist in the solicitation of proxies, who will receive a fee of$15,000,$20,000, plus reasonableout-of-pocketout of pocket costs and expenses, for its services. Broadridge will distribute proxy materials to banks, brokers, and other nominees for forwarding to beneficial owners and will request brokerage houses and other custodians, nominees, and fiduciaries to forward soliciting material to the beneficial owners of the common stock held on the record date by such persons. We will reimburse brokerage houses and other custodians, nominees and fiduciaries for their expenses in forwarding solicitation materials.OTHER MATTERSAs of the date of thisGetting Our Proxy Statementthere are no other matters that we intend to present, or have reason to believe others will present, at theand AnnualMeeting. If, however, other matters properly come before the Annual Meeting,ReportHOW CAN I ACCESS PROXY MATERIALS ONLINE?This Proxy Statement, the accompanying proxyauthorizes the persons named as proxies or their substitutes to vote on such matters as they determine appropriate.Proposals of stockholders to be considered for inclusion in the proxy statementcard, andproxy card for the 2019 Annual Meeting pursuant to Rule 14a-8 under the Exchange Act must be submitted in writing to the Chief Legal Officer & Secretary of Summit Materials, Inc., at Summit Materials, Inc., 1550 Wynkoop Street, 3rd Floor, Denver, Colorado 80202, and must be received no later than November 30, 2018. The submission of a stockholder proposal does not guarantee that it will be included inourproxy statement.In addition, our Bylaws include advance notice provisions that require stockholders wishing to bring nominations for directors or other business before an annual meeting to provide proper notice in accordance with the terms of the advance notice provisions. The Bylaws' advance notice provisions do not apply if the stockholder only seeks to include such matters in the proxy statement pursuant to Rule 14a-8.The Bylaws' advance notice provisions require that, among other things, stockholders give timely written notice to the Secretary of the Company regarding such nominations or other business and providethe information and satisfy the other requirements set forth in the Bylaws. To be timely, a stockholder who intends to present nominations or a proposal at the 2019 Annual Meeting of Stockholders other than pursuant to Rule 14a-8 must provide the information set forth in the Bylaws to the Secretary of the Company no earlier than January 17, 2019 and no later than February 16, 2019. However, if we hold the 2019 Annual Meeting of Stockholders more than 30 days before, or more than 70 days after, the anniversary of the 2018 Annual Meeting date, then the information must be received no earlier than the 120th day prior to the 2019 Annual Meeting date, and not later than the close of business on the later of (i) the 90th day prior to the 2019 Annual Meeting date or (ii) the tenth day after public announcement of the 2019 Annual Meeting date. If a stockholder fails to meet these deadlines and fails to satisfy the requirements of Rule 14a-4 under the Exchange Act, we may exercise discretionary voting authority under proxies we solicit to vote on any such proposal as we determine appropriate.We reserve the right to reject, rule out of order, or take other appropriate action with respect to any nomination or proposal that does not comply with these and other applicable requirements.HOUSEHOLDING: AVAILABILITY OF ANNUAL REPORT ON FORM 10-KAND PROXY STATEMENT
www.proxyvote.com.A copy of the 20172021 Annual Reportaccompanies this Proxy Statement. If you and others who share yourare being made available to stockholders online atInstead of mailingaddress own common stock in street name, meaning throughprinted copies of these materials, we will send some of our stockholders abank, brokerage firm, or other nominee, you may have received a notice that your household will receive only one Annual Report and Proxy Statement, orNotice of Internet Availability of Proxy Materialsas applicable, from the Company. This practice, known as "householding," is designed(“Notice”). If you received a Notice and would prefer toreduce the volume of duplicate information and reduce printing and postage costs. Unless you responded that you did not want to participate in householding, you were deemed to have consented to it, andreceive asinglepaper copy ofthis Proxy Statementour proxy materials, follow the instructions included in the Notice to update your preferences. If you elect to receive our future proxy materials electronically, you will receive access to those materials via e-mail unless andthe 2017 Annual Report (and/oruntil you elect otherwise.WHY DID MY HOUSEHOLD RECEIVE A SINGLE SET OF PROXY MATERIALS?SEC rules permit us to deliver a single copy of ourNotice of Internet Availability of Proxy Materials) has been sent to your address. Each street name stockholder receiving this2021 Annual Report and Proxy Statementby mailto any household at which two or more stockholders reside if we believe the stockholders are members of the same family. This practice benefits both you and Summit Materials, as it eliminates duplicate mailings and reduces our printing and mailing costs. Each stockholder will continue to receive a separatevoting instruction form.If you would like to revoke your consent to householding and in the future receive your own set of proxy materials (or your own Notice of Internet Availability of Proxy Materials, as applicable), or if your household is currently receiving multiple copies of the same items and you would like in the future to receive only a single copy at your address, please contact Householding Department by mail at 51 Mercedes Way, Edgewood, New York 11717, or by calling 1-866-540-7095, and indicate your name, the name of each of your brokerage firms or banks where your shares are held, and your account numbers. The revocation of a consent to householding will be effective 30 days following its receipt. You will also have an opportunity to opt in or opt out of householding by contacting your bank or broker.If you would like an additional copy of the 2017 Annual Report, this Proxy Statement, or the Notice of Internet Availability of Proxy Materials, these documents are available in digital form for download or review by visiting "Annual Reports and Proxies" atwww.proxyvote.com. Alternatively, we will promptly send a copy of these documents to you without charge upon request by mail to 51 Mercedes Way, Edgewood, New York 11717, or by calling 1-800-690-6903. Please note, however, that if you did not receive a printed copy of our proxy materials and you wish to receive a paperproxy card or voting instructionform or othercard.Your household may have received a single set of proxy materialsfor the purposes of the Annual Meeting, you should follow the instructions included in your Notice of Internet Availability of Proxy Materials.this year. If you prefer to receive your own
sharescopy now or in future years, please request a duplicate set by phone at 1-866-540-7095, online at www.proxyvote.com, or by writing to Summit Materials, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.If you hold your stock in street name, you may receive some duplicate mailings. Certain brokers will eliminate duplicate account mailings on request. You may need to contact your broker directly if you want to discontinue duplicate mailings to your household. You can also register to receive all future stockholder communications electronically, instead of in print. This means that links to the annual report, proxy statement, and other correspondence will be delivered to you via e-mail. Holders in street name can register for electronic delivery directly with their bank, brokerage firm, or other nominee. Electronic delivery of stockholder communications helps save the Company money by reducing printing and postage costs.Future Shareholder Proposals and NominationsRULE 14A-8 SHAREHOLDER PROPOSALUnder SEC rules, if you want us to include a proposal in our proxy statement for the 2022 Annual Meeting of Stockholders, you must submit it in writing to our Chief Legal Officer & Secretary at Summit Materials, Inc., 1550 Wynkoop Street, 3rd Floor, Denver, Colorado 80202, by December 2, 2022. Any such proposal should comply with the requirements of Rule 14a-8 promulgated under the Securities Exchange Act. The submission of a shareholder proposal does not guarantee that it will be included in our proxy statement.PROXY ACCESS NOMINATIONS AND OTHER PROPOSALS/NOMINATIONSUnder our Bylaws, a stockholder wishing to bring director nominations or other business before an annual meeting is required to provide advance written notice to the Chief Legal Officer & Secretary of Summit Materials regarding such nominations or other business and provide the information and satisfy the other requirements set forth in the Bylaws. To be timely, a stockholder who intends to present nominations or a proposal at the 2022 Annual Meeting other than pursuant to Rule 14a-8 must provide the information set forth in the Bylaws no earlier than January 18, 2023 and no later than February 17, 2023. However, if we hold the 2022 Annual Meeting more than 30 days before, or more than 70 days after, the anniversary of the 2022 Annual Meeting date, then the information must be received no earlier than the 120th day prior to the 2023 Annual Meeting date, and not later than the close of business on the later of the 90th day prior to the 2023 Annual Meeting date or the tenth day after public announcement of the 2023 Annual Meeting date. These advance notice provisions do not apply if the stockholder only seeks to include such matters in the proxy statement pursuant to Rule 14a-8.If a stockholder fails to meet these deadlines and fails to satisfy the requirements of Rule 14a-4 under the Securities Exchange Act, we may exercise discretionary voting authority under proxies we solicit to vote on any such proposal as we determine appropriate. We also reserve the right to reject, rule out of order, or take other appropriate action with respect to any nomination or proposal that does not comply with these and other applicable requirements.58 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTANNEX ARECONCILIATION OF
NON-GAAPMEASUREMEASURES TO GAAPThe following tablebelowreconciles our net income to Adjusted EBITDA for the year endedDecember 30, 2017January 1, 2022. Year ended
January 1, 2022 Reconciliation of Net Income (Loss) to Adjusted EBITDA ($ in thousands) Net income (loss) $ 154,281 Interest (income) expense 92,240 Income tax expense �� 44,356 Depreciation, depletion and amortization 226,442 EBITDA $ 517,319 Accretion 2,924 Loss on debt financings 6,016 Tax receivable agreement benefit (6,779) Gain on sale of businesses (20,011) Non-cash compensation 19,705 Other 908 Adjusted EBITDA $ 520,082 The following table reconciles net cash provided by operating activities to free cash flow for year ended January 1, 2022. Year ended
January 1, 2022 ($ in thousands) Net income $ 154,281 Non-cash items 253,976 Net income adjusted for non-cash items 408,257 Change in working capital accounts (46,328) Net cash provided by operating activities 361,929 Capital expenditures, net of asset sales (200,308) Free cash flow $ 161,621 2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTSUMMIT MATERIALS | 59The table below reconciles our Adjusted EBITDA to Further Adjusted EBITDA andDecember 31, 2016.our calculation of Net Debt to arrive at our Net Leverage Ratio for the year ended January 1, 2022. Year ended
January 1, 2022 ($ in thousands) Adjusted EBITDA $520 EBITDA for certain acquisitions / divestitures(1) (3) Transaction costs 3 Further Adjusted EBITDA(2) $520 Long-term debt, including current portion $1,610 Acquisition related liabilities 46.5 Finance leases and other 32.6 Less: Cash and cash equivalents 381 Net Debt $1,308.1 Net Leverage Ratio(3) 2.5x (1)Under the terms of our credit facilities, we include EBITDA from our acquisitions, net of dispositions, in each fiscal year for periods prior to acquisition.(2)Further Adjusted EBITDA is defined as Adjusted EBITDA plus the EBITDA contribution for certain recent acquisitions.(3)Net Leverage Ratio is defined as Net Debt divided by Further Adjusted EBITDA.60 | SUMMIT MATERIALS2022 NOTICE OF ANNUAL MEETING AND PROXY STATEMENTYear ended December 30,
2017December 31,
2016Reconciliation of Net Income to Adjusted EBITDA
Net income
$ 125,777 $ 46,126 Interest expense
108,549 97,536 Income tax benefit
(283,977 ) (5,299 ) Depreciation, depletion and amortization
177,643 147,736 EBITDA
$ 127,992 $ 286,099 Accretion
1,875 1,564 IPO/ Legacy equity modification costs
— 37,257 Loss on debt financings
4,815 — Tax receivable agreement expense
271,016 14,938 Transaction costs
7,733 6,797 Management fees and expenses
— (1,379 ) Non-cash compensation
21,140 12,683 Loss (gain) on disposal and impairment of assets
— 3,805 Other
1,206 9,583 Adjusted EBITDA
$ 435,777 $ 371,347 ![[MISSING IMAGE: tm223385d2-px_broadpg1bw.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/tm223385d2-px_broadpg1bw.jpg)
BROADRIDGE CORPORATE ISSUER SOLUTIONSC/O SUMMIT MATERIALS, INC.P.O. BOX 1342BRENTWOOD, NY 11717 VOTE BY
INTERNETINTERNETBefore The Meeting - Go to www.proxyvote.comUseor scan the QR Barcode aboveUse the Internet to transmit your voting instructions and for electronic delivery ofinformation upinformationup until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Haveyour proxyyourproxy card in hand when you access the web site and follow the instructions to obtainyour recordsyourrecords and to create an electronic voting instructionform. BROADRIDGE CORPORATE ISSUER SOLUTIONS C/O SUMMIT MATERIALS, INC. P.O. BOX 1342 BRENTWOOD, NY 11717 ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would likeform.During The Meeting - Go toreducewww.virtualshareholdermeeting.com/SUM2022You may attend thecosts incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronicallymeeting viae-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote usingthe Internet andwhen prompted, indicate that you agree to receive or access proxy materials electronicallyvote during the meeting. Have the informationthat is printed infuture years. VOTEthe box marked by the arrow available and follow the instructions.VOTE BY PHONE -1-800-690-6903 Use1-800-690-6903Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m.Eastern TimeEasternTime the day before the cut-off date or meeting date. Have your proxy card in handwhen youwhenyou call and then follow theinstructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. TOinstructions.Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) DateTO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:E40478-P05782KEEP THIS PORTION FOR YOURRECORDS DETACH AND RETURN THIS PORTION ONLY THISRECORDSTHIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.SUMMIT MATERIALS, INC. The Board of Directors recommends you vote "FOR" the following: For Withhold For All AllAllExcept To withhold authority to vote for any individual nominee, mark "For All Except" and write the number of the nominee on the line below. ! ! ! 1.DETACH AND RETURN THIS PORTION ONLYD74451-P67253Nominees:01) Joseph S. Cantie02) Anne M. Cooney03) Anne P. Noonan04) Tamla Oates-Forney1. Election of DirectorsNominees: 01) Howard L. Lance 02) Anne K. Wade The Board of Directors recommends you vote "FOR" proposals 2 and 3. For Against Abstain! ! !ForAllWithholdAllFor AllExcept! ! !! !! ! 2. Ratification of the appointment of KPMG LLP!Please sign exactly asour independent auditors for 2018. 3. Nonbinding advisory vote on the compensation of our named executive officers for 2017. NOTE:your name(s) appear(s) hereon. When signing as attorney, executor,administrator, or other fiduciary, please give full title as such. Joint owners should each signpersonally. All holders must sign. If a corporation or partnership, please sign in full corporateor partnership name by authorized officer.NOTE: Such other business as may properly come before the meeting or any adjournment or postponement thereof.Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date
![[MISSING IMAGE: tm223385d2-px_broadpg2bw.jpg]](https://capedge.com/proxy/DEF 14A/0001104659-22-041748/tm223385d2-px_broadpg2bw.jpg)
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:The Notice and Proxy Statement and Annual Report are available atwww.proxyvote.com. E40479-P05782 SUMMITwww.proxyvote.com.D74452-P67253SUMMIT MATERIALS,INC. AnnualINC.Annual Meeting of Stockholders May17, 201818, 2022, 8:00 A.M.Eastern Time This, Central TimeThis proxy is solicited by the Board ofDirectors TheDirectorsThe undersigned hereby appoint(s)Thomas W. Hill,AnneLee Benedict,P. Noonan, Christopher B. Gaskill, and Brian J. Harris, and each of them, each with full power of substitution, as proxies, and hereby authorize(s) them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of Class A Common Stock and/or Class B Common Stock of Summit Materials, Inc. (the "Company") that the undersigned is/are entitled to vote at the Annual Meeting of Stockholders to be held at 8:00 A.M.Eastern, Central Time, at The Post Oak Hotel at Uptown Houston, 1600 West Loop South, Houston, TX 77027 and onMay 17, 2018,the Internet through a virtual web conference atthe offices of the Company’s subsidiary, Hinkle Contracting Company, LLC, located at 101 Helm St., Suite 110, Lexington, Kentucky 40505,www.virtualshareholdermeeting.com/SUM2022, and at any adjournment or postponementthereof. Thisthereof.This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is given, this proxy will be voted "FOR" all portions of items (1), (2),and (4) and for "1 Year" for item (3); and in the proxies' discretion on any other matters coming before the meeting or any adjournment or postponementthereof. Continuedthereof.Continued and to be signed on reverse side