Payment of Filing Fee (Check the appropriate box): ☒
No fee required. ☐
Fee paid previously with preliminary materials. ☐
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a6(i)(1) and 0-11
2022 MANAGEMENT
INFORMATION CIRCULAR AND
PROXY STATEMENT ANNUAL MEETING OF SHAREHOLDERS | | | | | | |  | No fee required.Date
May 13, 2022
Time
8:00 a.m. Central Time | | | Place
Waste Connections, Inc.
3 Waterway Square Place
Suite 110
The Woodlands, TX 77380 | |
Waste Connections is an integrated solid waste services company that provides non-hazardous waste collection, transfer and disposal services, along with resource recovery primarily through recycling and renewable fuels generation. We serve more than eight million residential, commercial and industrial customers in mostly exclusive and secondary markets across 43 states in the U.S. and six provinces in Canada. We also provide non-hazardous oilfield waste treatment, recovery and disposal services in several basins across the U.S., as well as intermodal services for the movement of cargo and solid waste containers in the Pacific Northwest. 2021 BY THE NUMBERS OUR VALUES | | | | | | | | | |  | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.SAFETY | | | INTEGRITY | | | CUSTOMER SERVICE | |
| | | | | | | | | (1)TO BE A GREAT PLACE TO WORK | Title of each class of securities to which transaction applies: | | | (2) | Aggregate number of securities to which transaction applies: | | TO BE THE PREMIER WASTE SERVICES COMPANY IN THE U.S. AND CANADA | (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): | | (4) | Proposed maximum aggregate value of transaction: | | (5) | Total fee paid: | | Fee paid previously with preliminary materials. | | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | | (1) | Amount Previously Paid: | | (2) | Form, Schedule or Registration Statement No.: | | (3) | Filing Party: | | (4) | Date Filed: |
6220 Hwy 7, Suite 600
Woodbridge, Ontario L4H 4G3
Canada
Dear Fellow Shareholders:
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Executive Chairman of the Board of Directors “Our results in 2021 reflect our differentiated market model and a culture of accountability focused on stakeholders and value creation. We are well-positioned for continued growth in 2022 and beyond.” Dear Fellow Shareholders, You are cordially invited to attend the Annual Meeting (the “Meeting”) of Shareholders of Waste Connections, Inc. (the(“Waste Connections” or the “Company”) on Friday, May 14, 2021,13, 2022, at 8:00 a.m. (Central Time). The Meeting will be held at the Company’sour principal administrative offices located at Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380. Directions to the Meeting appear on the back cover of the accompanying Notice of Meeting and Management Information Circular and Proxy Statement.Waste Connections delivered another strong year of strong operating and financial performance in spite2021. Our results reflect a culture of the impacts from the COVID-19 pandemic. More importantly,commitment and accountability to our stakeholders that enables us to excel in a challenging operating environment, overcome inflationary pressures and supply chain issues, execute our growth strategy, expand margins, support employee health and welfare, and positions us for success in 2022 and beyond. Moreover, we providedcontinue to provide a differentiated level of frontline employee support to address the unprecedented health, economic and social challenges resulting from the COVID-19 pandemic. As an essential services provider, we recognized from the onset of the COVID-19 pandemic thatand its aftermath, with our communities would count on us,investment to date totaling over $50 million. Our 2021 financial and we on each other, to honor our commitments. Therefore, protecting the health, safetyoperating performance, human capital and welfare of our employees has guided every decision we have made.Our differentiated response to the COVID-19 pandemicESG updates, and the matters to be acted upon at the Meeting, are described in the accompanying Notice of Meeting and Management Information Circular and Proxy Statement. As always, we are lookinglook forward to meeting our shareholders in person and responding to any questions you may have about the Company. In-person attendance at
Thank you for your ongoing support and continued interest in Waste Connections. Ronald J. MittelstaedtExecutive Chairman of the Meeting will be granted on a first-come, first-served basis, and may be limited due to COVID-19-related restrictions.Board of DirectorsApril 1, 2022
| | | YOUR VOTE IS VERY IMPORTANT. | | | | | | | Whether or not you plan to attend the Meeting, we urge you to vote and submit your proxy in order to ensure the presence of a quorum. You may do so pursuant to the instructions on your proxy card (including by returning your proxy card by mail or using the Internet or your telephone) if you are a registered shareholder or pursuant to the instructions you receive from your bank or broker (including by using the Internet or your telephone if your bank or broker provides such instructions). Voting by using the Internet or telephone, or by returning your proxy card in advance of the Meeting, does not preclude you from attending the Meeting. |
Thank you for your ongoing support and continued interest in Waste Connections.
Very truly yours,
Ronald J. Mittelstaedt
Executive Chairman of the Board of Directors
April 1, 2021
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Notice of AnnualMeeting of ShareholdersLogistics DateMEETING INFORMATION
FRIDAY, MAY 14, 2021
May 13, 2022
Time8:00 a.m. Central Time PlaceWaste Connections, Inc.3 Waterway Square Place Suite 110
The Woodlands, TexasTX 77380
Your vote is very important.
You may vote using any of the following methods: Vote by visiting the website on your proxy card Vote by calling the telephone number on your proxy card Mail Your Proxy Card
Vote by signing, dating and returning your proxy card (See “General Information” on page i for more info) Who can vote at the annual meeting? Shareholders as of our record date, March 15, 2022. How many shares are entitled to vote? As of the Record Date, 257,153,307 Common Shares were outstanding and entitled to vote. May I change my vote?
Yes, you may deliver a new proxy with a later date, mail a notice revoking your proxy then vote in person, or update your vote using the Internet or telephone in accordance with the instructions on your proxy card. The Annual Meeting (the “Meeting”) of Shareholders of Waste Connections, Inc. (the “Company”) will be held on Friday, May 14, 2021,latest voting instructions, properly submitted by you and received before voting is closed at 8:00 a.m. (Central Time). Thethe Meeting, will be held at the Company’s principal administrative offices located at Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380,counted. How many votes do I get?Each shareholder of record is entitled to one vote for the following purposes:each Common Share held. Notice of 2022 Annual Meeting of Shareholders | | Meeting Agenda | | | Recommendation | | | | 1. | To elect the directors | | Election of the Company, to hold office until the close of the 2022 Annual Meeting of Shareholders of the Company or until any such director’s earlier resignation, or his or her successor is duly elected or appointed, which is directors | | | | | | FOR each director nominee.RECOMMENDED by our Board of Directors;
(See Page 65) | | | | | | 2. | To | | Non-binding, advisory vote to approve on a non-binding, advisory basis, the compensation of our named executive officers as disclosed in the Company’s Management Information Circular and Proxy Statement in respect of the Meetingofficer compensation (“say on pay”say-on-pay”), which is RECOMMENDED by our Board of Directors; | | | | | | FOR
(See Pages 66-68) | | | | | | 3. | To approve the appointment | | Ratification of Grant Thornton LLP as our independent registered public accounting firm until the closefor 2022 and authorization of the 2022 Annual Meeting of Shareholders of the Company, and authorize our Board of Directors to fix the auditor’sGrant Thornton LLP’s remuneration which is RECOMMENDED by our Board of Directors; and | | | | | | FOR
(See Page 69) | | | | | | 4. | To transact such | | Any other business asthat may properly come before the Meeting or(or any adjournment or postponement thereof. |
Only registered holders of common shares in the capital of the Company (the “Common Shares”) at the close of business on March 16, 2021, the record date for the Meeting, are entitled to receive notice of and to vote at the Meeting or any adjournment or postponement thereof. Access to the Meeting will be granted on a first-come, first-served basis, and participation in the Meeting may be limited due to COVID-19-related restrictions.
Important Notice Regarding the Availability of Proxy Materials
for the Annual Meeting of Shareholders to be Held on May 14, 2021 | This Notice of Meeting and the accompanying Management Information Circular and Proxy Statement and related solicitation materials in respect of the Meeting, our 2020 Annual Report, and our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which was filed with the U. S. Securities and Exchange Commission and the securities commissions or similar regulatory authorities in Canada on February 18, 2021, are available at www.wasteconnections.investorroom.com.Meeting) | |
Registered holders of Common Shares may vote their proxies by signing, dating and returning a proxy card or by using the Internet or telephone pursuant to the instructions on your proxy card. If your Common Shares are held in the name of a bank or broker, you may be able to vote on the Internet or by telephone. Please follow the instructions on the form you receive. Voting by using the Internet or telephone, or by returning your proxy card in advance of the Meeting, does not preclude you from attending the Meeting.
Your vote is important. YOUR VOTE IS VERY IMPORTANT. Whether or not you plan to attend the Meeting, we urge you to vote early and submit your proxy as promptly as possible in order to ensure your representationthe presence of a quorum at the Meeting. IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS This Notice of Meeting and the accompanying Management Information Circular and Proxy Statement and related solicitation materials in respect of the Meeting and our 2021 Annual Report to Shareholders (which includes our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, which was filed with the U. S. Securities and Exchange Commission and the securities commissions or similar regulatory authorities in Canada on February 17, 2022), are available at investors.wasteconnections.com. By Order of the Board of Directors, 
Patrick J. Shea
Executive Vice President, General Counsel and SecretaryApril 1, 2021REVIEW YOUR PROXY STATEMENT AND VOTE IN ONE OF FOUR WAYS: | | | | | |  |  |  |  | INTERNET | BY TELEPHONE | BY MAIL | IN PERSON | Visit the website on your proxy card | Call the telephone number on your proxy card | Sign, date and return your proxy card in the enclosed envelope | Attend the annual meeting in The Woodlands, Texas. See page 4 for instructions on how to attend | | | | | Please refer to the enclosed proxy materials or the information forwarded by your bank, broker or other holder of record to see which voting methods are available to you. |
MANAGEMENT INFORMATION CIRCULAR AND PROXY STATEMENT FOR THE ANNUAL MEETING
Management Information Circular and Proxy Statement for the 2022 Annual Meeting of Shareholders
Management Information Circular and Proxy Statement for the 2022 Annual Meeting of Shareholders About this Management Information Circular and Proxy Statement
We sent you this Management Information Circular and Proxy Statement (this “Proxy Statement”) because our management is soliciting your proxy to vote your Common Shares (as defined below) at the Annual Meeting (the “Meeting”) of Shareholdersshareholders of Waste Connections, Inc. (“Waste Connections”,Connections,” the “Company”, “we”, “us”,“Company,” “we,” “us,” or “our”) to be held at the Company’s principal administrative offices located at Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380 on May 14, 2021,13, 2022, at 8:00 a.m. (Central Time). This Proxy Statement includes information that we are required to provide to you under the rules of the U.S. Securities and Exchange Commission (“SEC”) and applicable corporate and securities laws in Canada, and that is designed to assist you in voting your common sharesCommon Shares in the capital of the Company (“Common Shares”). We will bear the costs of soliciting proxies from our shareholders. In addition to soliciting proxies by mail, our directors, officers, employees, and agents, without receiving additional compensation, may solicit proxies by telephone, in person or in any other manner permitted by applicable laws. Under the SEC rules and applicable Canadian securities laws that allow companies to furnish proxy materials to shareholders over the Internet, we have elected to deliver our proxy materials (defined below) to the majority of our shareholders over the Internet. This delivery process allows us to provide shareholders with the information they need electronically, which is more environmentally friendly and reduces our costs to print and distribute these materials. On or about April 1, 2021,2022, we will mail to our shareholders a Notice of Internet Availability of Proxy Materials (the “proxy notice”) containing instructions on how to access this Proxy Statement for the Meeting and our 20202021 Annual Report to Shareholders (which includes our Annual Report on Form 10-K for the fiscal year ended December 31, 2020,2021, which was filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 18, 2021)17, 2022) (referred to collectively as the “proxy materials”). The proxy notice also provides instructions on how to vote online or by telephone and includes instructions on how to receive a paper copy of the proxy materials by mail. On or about April 1, 2021,2022, we will also mailcommence mailing this Proxy Statement and a proxy card to certain shareholders. We are permitted under applicable securities laws to deliver a single proxy notice to one address shared by two or more United States shareholders. This delivery method is referred to as “householding” and helps reduce our printing costs and postage fees. Under this procedure, we deliver a single package containing proxy notices to multiple United States shareholders who share an address. If you do not wish to participate in householding in the future and prefer to receive separate proxy notices, please contact: Broadridge Financial Solutions, Attention: Householding Department, 51 Mercedes Way, Edgewood, NY 11717, telephone 1-800-542-1061. If you are currently receiving multiple proxy notices and wish to receive only one proxy notice for your household, please contact Broadridge Financial Services at the above applicable coordinates.Solutions. If you wish to receive a separate copy of this Proxy Statement, our 20202021 Annual Report to Shareholders, and our Annual Report on Form 10-K for the fiscal year ended December 31, 2020,2021, please send a written request to our Secretary or Investor Relations at our principal administrative offices located at Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380. WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT i
Cautionary Note Regarding Forward-Looking Statements This Proxy Statement contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995 (“PSLRA”), including “forward-looking information” within the meaning of applicable Canadian securities laws. These forward-looking statements are neither historical facts nor assurances of future performance and reflect our current beliefs and expectations regarding future events and operating performance of the Company. These forward-looking statements are often identified by the words “may,” “might,” “believes,” “thinks,” “expects,” “estimate,“estimates,” “continue,“continues,” “intends,” “anticipate”“anticipates,” ”will,” or
Management Information Circular and Proxy Statement for the 2022 Annual Meeting of Shareholders
other words or phrases of similar meaning. All of the forward-looking statements included in this Proxy Statement are made pursuant to the safe harbor provisions of the PSLRA and applicable Canadian securities laws. Forward-looking statements involve risks and uncertainties. Important factors that could cause actual results to differ, possibly materially, from those indicated by the forward-looking statements include, but are not limited to, risk factors detailed from time to time in our filings with the SEC and the securities commissions or similar regulatory authorities in Canada. You should not place undue reliance on forward-looking statements, which speak only as of the date of this Proxy Statement. We undertake no obligation to update the forward-looking statements set forth in this Proxy Statement, whether as a result of new information, future events, or otherwise, unless required by applicable securities laws. Currency Exchange Rate Data Unless otherwise indicated, all dollar amounts in this Proxy Statement are expressed in U.S. dollars. The following table shows the average of the exchange rates for each period indicated. Except as indicated below, theThe information is based upon the average daily exchange rates provided by the Bank of Canada:| | | Average rate (Bank of Canada)(1) | | | | | CAD$ per | | | US$ per | | | Year ended December 31, | | US$1.00 | | | CAD$1.00 | | | 2016(1) | | $ | 1.3248 | | | $ | 0.7548 | | | 2017 | | $ | 1.2986 | | | $ | 0.7701 | | | 2018 | | $ | 1.2957 | | | $ | 0.7718 | | | 2019 | | $ | 1.3269 | | | $ | 0.7536 | | | 2020 | | $ | 1.3415 | | | $ | 0.7454 | |
(1)Canada.| | | | | Average rate (Bank of Canada) | | | | Year ended December 31, | | | CAD$ per
US$1.00 | | | US$ per
CAD$1.00 | | | | 2017 | | | | $ | 1.2986 | | | | | $ | 0.7701 | | | | | 2018 | | | | $ | 1.2957 | | | | | $ | 0.7718 | | | | | 2019 | | | | $ | 1.3269 | | | | | $ | 0.7536 | | | | | 2020 | | | | $ | 1.3415 | | | | | $ | 0.7454 | | | | | 2021 | | | | $ | 1.2537 | | | | | $ | 0.7977 | | |
FINANCIAL STATEMENTS | The year-end average exchange rates for 2016 are based upon the noon buying rates provided by the Bank of Canada. The Bank of Canada discontinued the publication of noon buying rates in 2017. |
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT ii
PROXY SUMMARY
This summary highlights information described in more detail in this Proxy Statement pertaining to the Meeting. It does not contain all of the information that you should consider, and you should read the entire Proxy Statement carefully before voting.
2021 Annual Meeting of Shareholders
 |  |  | | | | Date and Time | Place | Mail Date | | | | Friday, May 14, 2021,
at 8:00 a.m. (Central Time) | Waste Connections, Inc.
3 Waterway Square Place, Suite 110
The Woodlands, Texas 77380 | April 1, 2021
Record Date
March 16, 2021
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Voting Matters, Board Recommendations and Vote Required
At the Meeting, shareholders will be asked to vote on the following three proposals. Our Board of Directors’ recommendations on each of these proposals is set forth below.
Proposal | | Board Recommendation | Proposal 1 – Election of the eight director nominees named in this Proxy Statement, each tohold office until the close of the 2022 Annual Meeting of Shareholders of the Company, or until such director’s earlier resignation, or his or her successor is otherwise duly elected or appointed (Page 18). | | FOR each director nominee | Proposal 2 – Approval, on a non-binding, advisory basis, of the compensation of theCompany’s named executive officers, or NEOs, as disclosed in this Proxy Statement (the “Say on Pay Proposal”) (Page 57). | | FOR | Proposal 3 – Appointment of Grant Thornton LLP as the Company’s independent registeredpublic accounting firm until the close of the 2022 Annual Meeting of Shareholders of the Company, and the authorization of the Board of Directors to fix the remuneration of the Company’s independent registered public accounting firm (Page 60). | | FOR |
Proposal 1 – Election of Directors
The election of each director nominee may be approved by any one or more shareholders voting “FOR” each such director nominee (i.e., a plurality vote). You may either vote “FOR” or “WITHHOLD” your vote with respect to the election of each director nominee. If you vote “FOR” the election of a nominee, your vote will be cast accordingly. If you select “WITHHOLD” with respect to the election of a nominee, your vote will not be counted as a vote cast for the purposes of electing such nominee but will be considered in the application of the majority voting policy included in our Corporate Governance Guidelines and Board Charter. Pursuant to our majority voting policy, a “WITHHOLD” vote is considered a vote cast for purposes of the election of the director nominee and is equivalent to a vote against the nominee. See “Majority Voting for Directors” on page 12 of this Proxy Statement.
Proposal 2 – Say on Pay Proposal
The Say on Pay Proposal may be approved by the affirmative vote of a simple majority (50 percent plus one) of the Common Shares present, either in person or by proxy, and entitled to vote (meaning that at least a simple majority of the votes cast must be “FOR” the Say on Pay Proposal in order for it to be approved). You may either vote “FOR” or “AGAINST” or you may “WITHHOLD” from voting on, the Say on Pay Proposal.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT iii
Proposal 3 – Appointment of Auditor
The appointment of the Company’s proposed independent registered public accounting firm may be approved by any one or more shareholders voting “FOR” the Company’s proposed independent registered public accounting firm (i.e., a plurality vote). For purposes of this proposal, votes cast at the Meeting include only those votes cast “FOR” the appointment of the proposed independent registered public accounting firm. You may either vote “FOR” or “WITHHOLD” your vote with respect to the appointment of the proposed independent registered public accounting firm. If you vote “FOR” the appointment of the proposed independent registered public accounting firm, your vote will be cast accordingly. If you select “WITHHOLD,” your vote will not be counted as a vote cast for purposes of appointing the proposed independent registered public accounting firm.
Looking at 2020
Waste Connections is an integrated solid waste services company that provides non-hazardous waste collection, transfer and disposal services, along with resource recovery primarily through recycling and renewable fuels generation. The Company serves more than seven million residential, commercial and industrial customers in mostly exclusive and secondary markets across 43 states in the U.S. and six provinces in Canada. Waste Connections also provides non-hazardous oilfield waste treatment, recovery and disposal services in several basins across the U.S., as well as intermodal services for the movement of cargo and solid waste containers in the Pacific Northwest.
In 2020, Waste Connections delivered another year of strong operating and financial performance, as highlighted below, in spite of the impacts from the COVID-19 pandemic. More importantly, we provided a differentiated level of employee support to address the unprecedented health, economic and social challenges resulting from the COVID-19 pandemic.
We recognized that reducing employee concerns regarding income, healthcare and family obligations during the pandemic would be critical to providing continuity of service and a bit of normalcy for our customers, reduce voluntary turnover and further improve safety performance. To support and protect our employees, we established protocols and implemented operational changes focused on the health and safety of our frontline employees and achieved seamless transitions to remote work environments for customer service representatives and other support personnel. In addition, we looked to provide a safety net for our employees on issues of income and family health. Through these efforts, we enabled our employees to make the right decisions about the health of their families and the well-being of their colleagues, which resulted in continuity of service to the communities we serve.
Looking beyond our people, we also recognized the needs of the communities where we live and work, increasing the level of charitable contributions to assist food banks, families at risk, and organizations with a focus on addressing racial inequities at a local or national level, providing meals for healthcare workers and higher-risk populations, and donating critical personal protective equipment. Our strong operating performance during this chaotic and unprecedented period reflects the benefit of this focus and is a testament to our culture, values, and the tireless efforts of every Waste Connections employee, whether in the field, in an office or working remotely.
COVID-19-Related Support
■ | Over $35 million of discretionary frontline employee support primarily for supplemental wages to all of our frontline employees, whether union or non-union, remote or in person, and including temporary employees, as well as a “Thank You” bonus late in the year; | ■ | Raised our targeted minimum wage to $15 per hour, above many state and provincial requirements, to further support approximately 4% of our employees below that level; | ■ | Expanded and extended access to medical benefits and covered COVID-19-related testing and medical costs; | ■ | Expanded our Employee Relief Fund for those experiencing financial hardship; | ■ | Launched the Waste Connections Scholarship Program to assist our employees’ children in pursuing their educational goals; and | ■ | Expanded community support to assist food banks, families at risk, and organizations with a focus on addressing racial inequities at a local or national level. |
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT iv
Performance Highlights(1)
■ | Increased revenue to $5.446 billion in spite of COVID-19-related impacts to solid waste volumes and E&P waste activity. | | | ■ | Net income attributable to the Company of $204.7 million and net cash from operations of $1.409 billion. | | | ■ | Adjusted EBITDA of $1.662 billion or 30.5% of revenue with underlying margin expansion in solid waste in spite of the high decremental margin impact from COVID-19-related decreases in commercial collection activity and disposal volumes, and the addition of over $35 million in incremental discretionary costs primarily related to frontline employee support. | | | ■ | Converted over 50% of adjusted EBITDA to adjusted free cash flow of $842 million. | | | ■ | Deployed approximately $664.5 million for capital expenditures, up 5% from the prior year, and $388.8 million for acquisitions to reinvest in and expand our business. | | | ■ | Ended 2020 with over $1.8 billion in liquidity and leverage of 2.4 times on a net debt to EBITDA basis, providing flexibility for further capital deployment. We diversified our lending sources and extended the tenor of our outstanding debt through two public offerings totaling $1.1 billion aggregate principal amount of investment grade senior notes. | | | ■ | Established long-term, aspirational environmental, social and governance (“ESG”) targets and committed over $500 million for investments to meet or exceed such targets. These investments primarily focus on reducing emissions, increasing resource recovery of both recyclable commodities and clean energy fuels, reducing reliance on off-site disposal for landfill leachate, increasing employee engagement, and further improving our industry-leading safety performance. | | | ■ | Advanced ESG initiatives, including continued improvement in safety, with incident rates down 12%; over 60% of our operating locations either posting zero safety-related incidents or driving year-over-year improvements, and Total Recordable Injury Rate of less than half the industry average; and increased employee engagement and retention, with an approximately 18% reduction in voluntary turnover on a year-over-year basis. | | | ■ | Returned over $305 million to shareholders through dividends and opportunistic share repurchases – with double digit percentage increase to per share cash dividend. As shown below, since its initiation in October 2010, our annual cash dividend has increased at a 15.4% compound annual growth rate (“CAGR”) since our first full year of quarterly distributions in 2011. |
DIVIDEND GROWTH
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(1) | This Proxy Statement includes certain measures that do not have a standardized meaning and are not defined by generally accepted accounting principles in the United States (“GAAP”) and, therefore, may not be comparable to similar measures used by other companies. We present adjusted net income, a non-GAAP financial measure, supplementally because it is one of the principal measures we use to evaluate and monitor the ongoing financial performance of our operations. We also present adjusted EBITDA, a non-GAAP financial measure, supplementally because it is widely used by investors as a performance and valuation measure in the solid waste industry. We also present adjusted free cash flow, a non-GAAP financial measure, supplementally because it is widely used by investors as a valuation and liquidity measure in the solid waste industry. These measures are not a substitute for, and should be used in conjunction with, GAAP financial measures. This section should be read in conjunction with information presented in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, under the heading “Non-GAAP Financial Measures”, which includes a reconciliation of the non-GAAP financial measures used in this Proxy Statement to GAAP financial measures. |
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT v
■ | Total shareholder return (“TSR”) of 13.9%, which was our 17th consecutive year of positive TSR. As illustrated, our TSR significantly outperformed the S&P 500 Index (the “S&P 500”), the S&P/TSX 60 Index (“TSX 60”) and the Dow Jones U.S. Waste & Disposal Services Index (“DJ Waste Index”) for the five-year period ended December 31, 2020. |
5-YEAR TOTAL SHAREHOLDER RETURN
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Commitment to the Environment and Sustainability
Waste Connections views its ESG efforts as integral parts of its business, with sustainability initiatives consistent with its objective of long-term value creation. We recognize the importance to our stakeholders of our continuing efforts to minimize our impact on the environment as well as measuring the positive impacts we have on the communities we serve, the development and welfare of our employees, the financial health of our Company, and the returns to our shareholders.
Since expanding the disclosure in our Sustainability Report in 2018 to include Global Reporting Initiative data, with a subsequent update in 2019 to also include Sustainability Accounting Standards Board data, we introduced long-term, aspirational sustainability targets in 2020, shown below, and announced a $500 million commitment to the advancement of their achievement. In addition, as more fully described on page 28, progress towards the achievement of long-term aspirational sustainability targets has been added as a performance measurement for our performance-based restricted share unit awards (“Performance Share Units” or “PSUs”) starting in 2021.
For more information about our ESG initiatives, we encourage you to visit our website at www.wasteconnections.com/sustainability.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT vi
Commitment to Safety
Safety is our first operating value at Waste Connections. We are committed to the safety of our employees, customers, and the communities we serve. Our ultimate goal is to “Drive to ZERO”, that is, to achieve zero incidents and accidents. Our success in safety is driven by our self-directed and empowered employees taking personal ownership for their safety and the safety of those around them. As servant leaders, we endeavor every day to protect our employees and the communities we are privileged to work in and around. We utilize on-board event recording technology to identify both risky behavior, which is coached, and best practices, which are reinforced. We have developed a risk-based scoring system for our drivers to improve their safe driving skills and hold our leaders responsible for the performance of the employees they are privileged to serve.
While we attribute our successful safety record to our culture and behavior-based approach, we recognize that advances in fleet design and technology can be important tools in identifying risky behaviors and providing coaching opportunities to further improve our performance.
To that end, in 2020, we initiated a two-year, $10 million fleet-wide upgrade of our on-board event recording technology and introduced Freightliner EconicSD trucks with an overhauled cab design that incorporates many of the safety features already included in passenger vehicles, as well as an integrated collision mitigation system, enhanced visibility, and several ergonomic improvements.
Commitment to Culture
At Waste Connections, we maintain that our purposeful culture drives differentiated results, and therefore investing in our people is a priority as we employ an approach guided by Servant Leadership. This concept inverts the traditional management hierarchy, positioning leaders to serve their employees both professionally and personally. The philosophy empowers employees by prioritizing their needs, sharing responsibility and driving personal development. As a result, a significant amount of our management time and resources are dedicated to leadership training and development.
We recognize the importance of engagement in driving culture and increasing retention, which was magnified in 2020, when the COVID-19 pandemic necessitated the use of remote alternatives to in-person training and development and highlighted the importance of connectivity both inside and outside of the Company. Indicators of employee engagement include retention, voluntary turnover and satisfaction, as measured through annual Servant Leadership surveys. In 2020, our total turnover improved by 11.2%, with voluntary turnover down approximately 18% on a year-over-year basis.
We conduct an annual Servant Leadership survey, which provides employees the opportunity to evaluate their managers on an anonymous basis and provide written feedback. We include continuous improvement in the scores as an element of the long-term, aspirational targets included in our 2020 Sustainability Report. In 2020, our managers’ Servant Leadership scores increased by 1.9%, with an employee response rate of over 86%.
Commitment to Diversity & Inclusion
In keeping with our efforts to support and encourage diversity and inclusion, we have undertaken several initiatives, including adopting in 2019 a formal Diversity Policy for our Board of Directors and Senior Management with aspirational targets for female Board representation, and additional disclosure on workforce composition. In addition, in 2020, we incorporated diversity and inclusion into Servant Leadership training, focused our leadership summit on understanding and mitigating unintended biases, expanded our Servant Leadership assessments of managers by employees to include diversity and inclusion, enhanced recruiting practices to ensure the broadest candidate pools, established financial commitments to organizations that focus on racial inequities and that support women and children at risk, and supported the development of resource groups including our Women’s Network and Veterans’ S.E.R.V.E. Network. Waste Connections is a signatory to the CEO Action for Diversity & Inclusion, the largest CEO-driven business commitment to advance diversity and inclusion within the workplace.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT vii
Corporate Governance Highlights
■ | Directors elected individually (page 18); | | | ■ | Majority voting policy for the election of our Directors (page 12); | | | ■ | Separate Chief Executive Officer, or CEO, and Board Chairman (page 8); | | | ■ | We have a strong lead independent director of the Board of Directors (page 8); | | | ■ | Women account for 33% of independent Board members and 25% of total Board members (page 14); | | | ■ | Annual Board of Directors and committee evaluation processes (page 9); | | | ■ | Robust risk management program related to compensation of Directors, NEOs and other corporate officers (page 39); | | | ■ | Share ownership requirement for Directors, NEOs and other corporate officers (pages 16 and 35, respectively); | | | ■ | Regular executive sessions of only independent directors (page 8); | | | ■ | Director retirement policy (page 9); | | | ■ | Diversity Policy including aspirational targets for Board of Directors and senior management composition (page 13); and | | | ■ | Code of Conduct and Ethics (page 5). |
Executive Compensation Program
The Company’s executive compensation program is designed to align the interests of senior management with shareholders by tying a significant portion of their compensation to the Company’s annual operating and financial performance, as well as longer-term shareholder returns and, beginning in 2021, progress towards achievement of ESG targets. We believe that our pay-for-performance philosophy and the design of our executive compensation program strongly support, as shown above, an environment of continuous improvement and shareholder value creation. Best practices of our executive compensation program include the following:
■ | Approximately 74% of the target total direct compensation of our NEOs is variable and linked to the Company’s performance; | | | ■ | Performance Share Units constitute 50% of total equity-based compensation; | | | ■ | Payouts under the Company’s performance-based plans remain at the discretion of the Board of Directors and may be reduced even if targeted performance levels are achieved; | | | ■ | NEOs receive annual cash incentive bonus awards only if cash incentive bonus awards payable to other, non-executive employees have been made; | | | ■ | No guaranteed base salary increases, minimum bonuses or equity awards; | | | ■ | Conservative use of equity grants; | | | ■ | Inclusion of a relative TSR metric as a performance measure for PSUs and addition of ESG target improvement as a performance measure for PSUs beginning in 2021; | | | ■ | Stringent share ownership requirements; | | | ■ | Double-trigger change of control policy for our CEO and other NEOs; | | | ■ | No hedging or pledging of the Company’s securities; | | | ■ | Compensation clawback policy; | | | ■ | Independent executive compensation consultant retained by Compensation Committee; | | | ■ | Annual “Say on Pay” vote; and | | | ■ | Adoption of position descriptions for the Board Chairman (including a Board Chairman that is an Executive Chairman), the lead independent director and the chairs of the committees of the Board of Directors, as well as a position description for our CEO. |
For additional information, see the “Executive Compensation” and “Compensation Risk Assessment” sections of this Proxy Statement (starting at page 25 and page 39, respectively).
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT viii
Financial Statements
A more detailed description of the Company’s fiscal year 20202021 operating and financial performance, including a reconciliation of non-GAAP financial measures and a graphical representation of the Total Shareholder Returns or TSRs for the Company, the S&P 500, the S&P/TSX 60 (“TSX 60”) and the Dow Jones U.S. Waste and Disposal Services (“DJ Waste Index,Waste”) Indices, can be found on pages 75-7749-75 and pages 43-44,47-48, respectively, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020,2021, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 18, 2021,17 2022, and available on our website at www.wasteconnections.com,https://investors.wasteconnections.com, on SEDAR at https://www.sedar.com, on EDGAR at https://www.sec.gov, and in print, free of charge, to any shareholder who requests in writing a copy by contacting our Secretary or Investor Relations at our principal administrative offices located at Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380. Vote Your Common Shares
VOTE YOUR COMMON SHARES Whether or not you plan to attend the Meeting, we urge you to vote and submit your proxy in order to ensure the presence of a quorum. You may do so pursuant to the instructions on your proxy card (including by returning your proxy card by mail or using the Internet or your telephone) if you are a registered shareholder or, pursuant to the instructions you receive from your bank or broker (including by using the Internet or your telephone if your bank or broker provides such instructions). Voting by using the Internet or telephone, or by returning your proxy card in advance of the Meeting, does not preclude you from attending the Meeting. Please refer to your proxy card or voting instruction form included with this Proxy Statement or to the “Voting and Revocation” section on page 2pages ii and iii of this Proxy Statement for more information on the voting methods available to you. If you plan to attend, please bring identification and, if you hold Common Shares in street name, you should bring your bank or broker statement showing your beneficial ownership of Common Shares to be admitted to the Meeting. In-person attendance at the Meeting will be granted on a first-come, first-served basis, and may be limited due to COVID-19-related restrictions.
WASTE CONNECTIONS, INC.Table of Contents | 2021 PROXY STATEMENT ix
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General Information The record date for determining the holders of Common Shares entitled to receive notice of and to vote at the Meeting is March 16, 202115, 2022 (the “Record Date”). Only shareholders whose names have been recorded in our share register at the close of business on the Record Date will be entitled to receive notice of and to vote at the Meeting. As of the Record Date, 262,564,306257,153,307 Common Shares were outstanding and entitled to vote. Each shareholder of record is entitled to one vote for each Common Share held by the shareholder.
Business of Meeting; What is Being Voted On Shareholders will be voting (i) voting: 1)
to elect the nominees for directors of the Company (ii) 2)
in an advisory, non-binding capacity, to approve the compensation of our NEOsnamed executive officers (“NEOs”) as disclosed in the “Executive Compensation” sectionon pages 31 to 60 of this Proxy Statement (“Say on Pay”(the “Say-on-Pay Proposal”); and (iii) 3)
to approve the appointment of Grant Thornton LLP as auditors of the Companyour independent registered public accounting firm for 2022 and to authorize the Board of Directors to fix the auditor’s remuneration. Grant Thornton LLP’s remuneration Our Board of Directors (the “Board of Directors” or the “Board”) is recommending that shareholders vote “ FOR” each of the nominees in proposal (i)(1); and “FOR” proposals (ii)(2) and (iii)(3).In addition to the foregoing matters, the Company’sour audited consolidated financial statements for the fiscal year ended December 31, 2020,2021, and the auditor’sauditors’ report thereon, will be placed before the Meeting. No formal action will, or is required to, be taken at the Meeting with respect to our audited consolidated financial statements for the fiscal year ended December 31, 2020.2021. Our 20202021 audited consolidated financial statements, and the auditor’sauditors’ report thereon, were included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020,2021, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 18, 2021,17, 2022, and available on our website at www.wasteconnections.investorroom.com,https://investors.wasteconnections.com/sec-filings, on SEDAR at https://www.sedar.com, on EDGAR at https://www.sec.gov, and in print, free of charge, to any shareholder who requests in writing a copy by contacting our Secretary or Investor Relations at our principal administrative offices located at Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380.
PROPOSAL 1 – Election of Directors— ELECTION OF DIRECTORS The election of each director nominee may be approved by any one or more shareholders voting “FOR” each such director nominee (i.e., a plurality vote). For purposes of this proposal, votes cast at the Meeting include only those votes cast “FOR” the election of a director nominee. You may either vote “FOR” or “WITHHOLD” your vote with respect to the election of each director nominee. If you vote “FOR” the election of a nominee, your vote will be cast accordingly. If you select “WITHHOLD” with respect to the election of a nominee, your vote will not be counted as a vote cast for the purposes of electing such nominee but will be considered in the application of the majority voting policy included in our Corporate Governance Guidelines and Board Charter. See “Majority Voting for Directors” on page 12pages 13 and 14 of this Proxy Statement. Pursuant to ourOur majority voting policy calls for a “WITHHOLD” vote isto be treated as a share present or represented and entitled to vote on the director nominee and has the same effect as a vote “AGAINST” the nominee. WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 1
ProposalPROPOSAL 2 – Say on Pay Proposal
— SAY-ON-PAY PROPOSAL The Say on PaySay-on-Pay Proposal may be approved by the affirmative vote of a simple majority (50 percent plus one) of the Common Shares present, either in person or by proxy, and entitled to vote (meaning that at least a simple majority of the votes cast must be “FOR” the Say on PaySay-on-Pay Proposal in order for it to be approved). You may either vote “FOR” 2022Notice of Annual Meeting & Proxy Statementi
or “AGAINST,” or you may “WITHHOLD” from voting on, the Say on PaySay-on-Pay Proposal. For purposes of the Say on PaySay-on-Pay Proposal, a “WITHHOLD” vote will have the same effect as a vote “AGAINST” the Say on PaySay-on-Pay Proposal because those Common Shares are considered to be present and entitled to vote but are not voted. Proposal
PROPOSAL 3 – Appointment of Auditor— APPOINTMENT OF AUDITOR The appointment of the Company’sour proposed independent registered public accounting firm may be approved by any one or more shareholders voting “FOR” the Company’s proposed independent registered public accounting firm (i.e., a plurality vote). For purposes of this proposal, votes cast at the Meeting include only those votes cast “FOR” the appointment of the proposed independent registered public accounting firm. You may either vote “FOR” or “WITHHOLD” your vote with respect to the appointment of the proposed independent registered public accounting firm. If you vote “FOR” the appointment of the proposed independent registered public accounting firm, your vote will be cast accordingly. If you select “WITHHOLD” your vote will not be counted as a vote cast for purposes of appointing the proposed independent registered public accounting firm.
Broker non-votes are counted as present and entitled to vote at the Meeting for the purpose of establishing a quorum but are not considered votes cast at the Meeting and will have no effect on the outcome of the vote ofon any of the proposals to be considered at the Meeting. A broker non-vote occurs when a broker signs and returns a proxy but does not vote on a particular proposal because the broker does not have discretionary voting power for that particular item and has not received voting instructions from the beneficial owner.
You may receive more than one proxy card and/or proxy notice depending on how you hold your Common Shares. You should complete and return each proxy card or other voting instruction request provided to you in accordance with the instructions provided therein. Registered Holders
REGISTERED HOLDERS If you are a registered holder of Common Shares as of the Record Date, you will be able to vote your proxy pursuant to the instructions on your proxy card, including by mail by signing, dating and mailing a proxy card in the postage-paid envelope provided, or by using the Internet or your telephone. You may also attend the Meeting and vote in person. Voting by using the Internet or telephone, or by returning your proxy card in advance of the Meeting, does not preclude you from attending the Meeting. You are a registered shareholder if your name appears on your certificate or statement from the Direct Registration System representing your Common Shares. If this is the case, you may appoint someone else to vote for you as your proxy holder by using the enclosed form of proxy card. Computershare Investor Services must receive your appointment no later than 8:00 a.m. (Central Time) on May 12, 2022. The persons named as proxies in such form of proxy card are the Executive Vice President and Chief Financial Officer ofand the Company and theSenior Vice President, Deputy General Counsel and Assistant Secretary of the Company. However, you have the right to appoint any other person or company (who need not be a shareholder) to attend and act on your behalf at the Meeting. That right may be exercised by writing the name of suchthe person or company in the blank space provided in the form of proxy card or by completing another proper form of proxy card or by using the Internet by following the instructions provided on your proxy card. Make sure that the person you appoint is aware that he or she is appointed, and that this person attends the Meeting. Even if you vote your Common Shares by mailing a proxy card, or by using the Internet or by telephone in accordance with the instructions on your proxy card, you may revoke your proxy and cast a new vote at the Meeting, if we are able to verify that you are a registered holder of Common Shares, or by mailing a notice revoking the prior proxy and then voting in person or as otherwise permitted by applicable law. You may also change your vote before the Meeting by mailing another proxy card bearing a later date, by updating your vote using the Internet or telephone in accordance with the instructions on your proxy card, or by delivering a letter revoking the proxy card to our Secretary at our principal administrative offices located at ii
Waste Connections Inc.,
3 Waterway Square Place, WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 2
Suite 110, The Woodlands, Texas 77380. Broadridge Financial Solutions, Inc.Computershare Investor Services must receive your revocation no later than 5:8:00 p.m. (Easterna.m. (Central Time) on May 13, 2021.12, 2022. The proxy card or your Internet or telephone voting instructions, with the latest date properly submitted by you before voting is closed at the Meeting, will be counted. Shares Held in Street Name (Non-registered Holders)
SHARES HELD IN STREET NAME (NON-REGISTERED HOLDERS) If you have selected a broker, bank, or other intermediary to hold your Common Shares rather than having them directly registered in your name with our transfer agent, Computershare Investor Services, you will receive instructions from your broker, bank, or other intermediary on the procedure to follow to vote your Common Shares. Your broker, bank or other intermediary also may permit you to vote your proxy by telephone or the Internet. Please be aware that beneficial owners of Common Shares held by brokers, banks or other intermediaries may not vote their Common Shares in person at the Meeting unless they first obtain a written authorization to do so from their broker, bank or other intermediary and can only change or revoke previously issued voting instructions pursuant to instructions provided by their broker, bank, or other intermediary. We urge you to vote by following the instructions of your broker, bank, or other intermediary. However, if you wish to vote in person at the Meeting, insert your own name in the space provided on the voting instruction form provided by your broker, bank, or other intermediary to appoint yourself as proxy holder and follow the signature and return instructions of your broker, bank or other intermediary. Broadridge Financial Solutions, Inc.Computershare Investor Services must receive your appointment no later than 5:8:00 p.m. (Easterna.m. (Central Time) on May 13, 2021.12, 2022. Non-registered shareholders who appoint themselves as proxy holders should present themselves at the Meeting to a representative of the Company. Other than appointing yourself as your own proxy holder, do not otherwise complete the voting instruction form sent to you as you will be voting at the Meeting. Non-registered shareholders are either “objecting beneficial owners” or “OBOs”,“OBOs,” who object to the disclosure by intermediaries of information about their ownership in the Company, or “non-objecting beneficial owners” or “NOBOs”,“NOBOs,” who do not object to such disclosure. The Company pays intermediaries to send proxy-related materials to OBOs and NOBOs.
Our Board of Directors is asking for your proxy. Giving us your proxy means that you authorize us to vote your Common Shares at the Meeting in the manner you direct. The Common Shares represented by your proxy will be voted or withheld from voting in accordance with your instructions on any ballot that may be called for, and if you specify a choice with respect to any matter to be acted upon, your Common Shares will be voted accordingly. If you sign your proxy card or voting information form but do not give voting instructions, we will vote your Common Shares as follows: ■ | FOR each of our director nominees; | ■ | FOR the non-binding, advisory proposal to approve the compensation of our NEOs as disclosed in this Proxy Statement (also known as say on pay); and | ■ | FOR the appointment of the independent registered public accounting firm and authorizing the Board of Directors to fix the auditor’s remuneration. |
•
FOR each of our director nominees •
FOR the non-binding, advisory proposal to approve the compensation of our NEOs as disclosed in this Proxy Statement (the Say-on-Pay Proposal) •
FOR the appointment of Grant Thornton LLP as our independent registered public accounting firm for 2022 and the authorization of the Board of Directors to fix the Grant Thornton LLP’s remuneration You can choose to vote “FOR” or “WITHHOLD” from: (i)(1) the election of any one or more of the persons nominated for election as directors; and (ii)(2) the appointment of Grant Thornton LLP as our independent registered public accounting firm until the close of business of the 20222023 Annual Meeting of Shareholdersshareholders of the Company and the authorization of the directors to fix the auditor’s remuneration. You can choose to vote “FOR”, “AGAINST” or “WITHHOLD” on the approval, on a non-binding, advisory basis, of the compensation of our NEOs as disclosed in this Proxy Statement.Say-on-Pay Proposal. To carry on the business of the Meeting, we must have a quorum at the Meeting. A quorum for the transaction of business at a meeting of shareholders of the Company consists of at least two persons present and each entitled to vote at the meeting and holding personally or representing as proxies, in the aggregate, 25% of the eligible vote. 2022Notice of Annual Meeting & Proxy Statementiii
Abstentions and broker non-votes are counted as present and entitled to vote at the Meeting for purposes of determining whether we have a quorum. A broker non-vote occurs when a broker signs and returns a proxy but does not vote on a particular proposal because the broker does not have discretionary voting power for that particular item and has not received voting instructions from the beneficial owner. WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 3
Only shareholders, their proxy holders and our invited guests may attend the Meeting. If you plan to attend, please bring identification and, if you hold Common Shares in street name, you should bring your bank or broker statement showing your beneficial ownership of Common Shares in order to be admitted to the Meeting. In-person attendance at the Meeting will be granted on a first-come, first-served basis, and may be limited due to COVID-19-related restrictions.
How to Contact our Transfer Agent You can contact our transfer agent either by mail at Computershare Investor Services, 100 University Avenue, 8thFloor, Toronto, Ontario M5J 2Y1, by telephone at 1-800-564-6253, by fax at 1-888-453-0330 or by Internet at https://www.computershare.com/ca/en/contact-us.
Proxy Summary This summary highlights information contained elsewhere in Englishthis Proxy Statement. This summary does not contain all of the information you should consider, and you should read the entire Proxy Statement carefully before voting. | | PROPOSAL | | | REQUIREMENT FOR
APPROVAL | | | EFFECT OF VOTES WITHHELD | | | | 1. | | | Election of Directors | | | You may vote FOR or WITHHOLD your vote from any or all director nominees named in this proposal. The election of each director nominee may be approved by any one or more shareholders voting “FOR” each such director nominee (i.e., a plurality vote). | | | A “WITHHOLD” vote is treated as a share present but not a vote cast. A “WITHHOLD” vote will not be counted as a vote cast for the purposes of electing such nominee. However, in uncontested director elections, an incumbent director who receives more “WITHHOLD” votes than votes “FOR” in respect of his or her election must tender their resignation from the Board of Directors. (See Pages 13-14 “Majority Voting for Directors”) | | | | THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” EACH NOMINEE (See Page 65) | | | | 2. | | | Say-on-Pay | | | You may vote FOR or AGAINST or you may WITHOLD your vote from this proposal. This proposal will be considered approved by the affirmative vote of a simple majority (50 percent plus one) of the Common Shares present, either in person or by proxy, and entitled to vote. | | | A “WITHHOLD” vote will have the same effect as a vote “AGAINST” this proposal because those Common Shares are considered to be present. | | | | THE BOARD OF DIRECTORS RECOMMENDS YOU VOTE “FOR” THIS PROPOSAL
(See Pages 66-68) | | | | 3. | | | Appointment of Auditor | | | The appointment of Grant Thornton LLP as our independent registered public accounting firm may be approved by any one or more shareholders voting “FOR” the Company’s proposed independent registered public accounting firm (i.e., a plurality vote). You may vote FOR or WITHHOLD your vote from this proposal. | | | A “WITHHOLD” vote will not be counted as a vote cast for purposes of appointing the proposed independent registered public accounting firm. | | | | THE BOARD OF DIRECTORS RECOMMENDS YOU VOTE “FOR” THIS PROPOSAL
(See Page 69) | |
2022Notice of Annual Meeting & Proxy Statement1
2021 Performance Highlights As illustrated below, our Total Shareholder Return (“TSR”) significantly outperformed the S&P500, the TSX60 and the DJ Waste Index for the five-year period ended December 31, 2021. In addition, since its initiation in October 2010, our annual cash dividend has increased at www-us.computershare.com/Investor/#Contact?cc=ca&lang=en,a 14.9% compound annual growth rate (“CAGR”). 5-YEAR TOTAL SHAREHOLDER RETURN (1)
This Proxy Statement includes certain measures that do not have a standardized meaning and are not defined by GAAP and, therefore, may not be comparable to similar measures used by other companies. We present adjusted EBITDA, a non-GAAP financial measure, supplementally because it is widely used by investors as a performance and valuation measure in the solid waste industry. We also present adjusted free cash flow, a non-GAAP financial measure, supplementally because it is widely used by investors as a valuation and liquidity measure in the solid waste industry. These measures are not a substitute for, and should be used in conjunction with, GAAP financial measures. This section should be read in conjunction with information presented in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, under the heading “Non-GAAP Financial Measures”, which includes a reconciliation of the non-GAAP financial measures used in this Proxy Statement to GAAP financial measures, as well as pages 52 and 74 of the Form 10-K, which includes additional information on leverage ratio.
We view efforts to minimize our impact on the environment and drive continuous improvement in employee safety, engagement and retention as integral to our business, driving long-term value creation for all of our stakeholders. As part of our commitment to provide increased transparency on our sustainability efforts, we introduced fifteen-year, aspirational environmental, social and governance (“ESG”) and sustainability targets in 2020, along with a commitment of $500 million towards their achievement. Since the onset of the COVID-19 pandemic, we have invested over $50 million, primarily directed to support front line employees, including supplemental wages and enhanced benefits, to provide for the health and welfare of our employees and their families. We’ve expanded access to our Employee Relief Fund and launched the Waste Connections Scholarship Fund. We have realized improvement in safety incident rates, with over 55% of operating locations either posting zero safety-related incidents or achieving year-over-year improvements in French2021; and our Total Recordable Injury Rate and risk cost as a percentage of revenue remained below industry averages. 2022Notice of Annual Meeting & Proxy Statement3
We believe that people are our greatest differentiator. We aim to be an employer of choice that attracts and retains high performing talent with the mindset, skillset and commitment to uphold our values of safety, integrity, customer service, being a great place to work and the premier solid waste services company in the U.S. and Canada. Our goal is to create an inclusive environment where self-directed, empowered employees strive to consistently fulfill our constituent commitments and seek to create positive impacts through interactions with customers, communities and fellow employees, always relying on our Operating Values as the foundation for our existence. All employees are responsible for upholding the Waste Connections Vision and Values, and the Waste Connections Code of Conduct, which form the foundation of our policies and practices. Moreover, we are committed to an inclusive, supportive environment built on the principles of Servant Leadership(2), valuing diversity and inspiring employee growth. As such, developing our talent and maintaining our culture through employee engagement are integral to the growth and sustainability of our business. | | | ENGAGEMENT
| | | | | | COMPENSATION/
BENEFITS | | | | | | TRAINING
| | •
Our Servant Leadership surveys provide employees the opportunity to evaluate their managers and provide written feedback for continuous employee and leadership improvement | | | •
Our total rewards package includes market-competitive pay •
Increased our minimum wage target to $15 per hour (CAD$16) in 2020 •
Bonus opportunities, affordable healthcare plans, generous flexible time off plans and retirement benefits •
Opportunity to share in our success through an Employee Share Purchase Plan | | | •
Approximately 24% of our leadership team participated in multi-day Servant Leadership training sessions during 2021 despite COVID-19 restrictions | |
We are committed to building and developing diverse teams that function in an environment of mutual respect, where employees feel valued, empowered to contribute and positioned for success. In keeping with our efforts to support and encourage diversity and inclusion, we have undertaken several initiatives, including adopting in 2019 a formal Diversity Policy for our Board of Directors and Senior Management with aspirational targets for female Board representation, and providing additional disclosure on workforce composition. Since that time, we’ve incorporated diversity and inclusion into Servant Leadership training, expanded our annual Servant Leadership assessments of our managers by employees to incorporate a diversity and inclusion score, and introduced a monthly educational program focused on diversity and inclusion that is available to all employees through our Learning Management System with additional discussion tools provided to our leadership team. We’ve also enhanced recruiting practices to ensure the broadest candidate pools, established financial commitments to organizations that focus on racial inequities and that support women and children at www-us.computershare.com/Investor/#Contact?cc=ca&lang=fr.risk, and supported the development of resource groups including our Women’s Network and Veterans’ S.E.R.V.E. Network. Waste Connections is a signatory to the CEO Action for Diversity & Inclusion, the largest CEO-driven business commitment to advance diversity and inclusion within the workplace. WASTE CONNECTIONS, INC. (2)
|For more information about Servant Leadership, please see page 34 of our 2021 PROXY STATEMENT Sustainability Report, available at https:// www.wasteconnections.com/sustainability. The 2021 Sustainability Report does not constitute part of, and is not incorporated by reference into, this Proxy Statement or any other report we provide to the SEC or other securities regulators.
2022Notice of Annual Meeting & Proxy Statement5
We are guided by our commitment to principled actions, informed and effective decision-making, and appropriate monitoring of compliance and performance. | Annual director elections | | | All directors are elected annually for a one-year term. | | | Majority voting | | | We have a majority voting policy for uncontested elections of directors. | | | One share equals one vote | | | We have a single class of shares with equal voting rights. | | | Separation of Chairman and CEO roles | | | Our CEO is able to focus on managing the Company and our Executive Chairman drives accountability at the board level. | | | Lead Independent Director | | | We have a strong lead independent director of the Board of Directors. | | | Financial expertise | | | All members of our Audit Committee are financially literate and 50% of our Audit Committee members qualify as audit committee financial experts. | | | Compensation policies and practices | | | Our compensation policies and practices, including our approach to setting performance targets, evaluating performance, and establishing payouts, have been developed to avoid excessive risk-taking. | | | Share ownership guidelines | | | We have robust share ownership guidelines for our directors and executive officers. | | | Succession planning | | | Our Board regularly reviews Board and executive succession planning. | | | Education and training | | | Our Board regularly receives training and updates on ethics, compliance, and governance. | | | Board and committee self-evaluations | | | Our Board and committees conduct annual performance self-evaluations led by the Chair of our Nominating and Corporate Governance Committee. | | | Public company board memberships | | | Directors who serve as chief executive officers or in equivalent positions at any company should not serve on more than two boards of public companies in addition to our Board of Directors; other directors should not serve on more than four other boards of public companies. | | | Risk oversight | | | Directors regularly review information from members of our senior management team regarding our safety performance, employee retention, financial performance, financial outlook, balance sheet, credit profile and liquidity, cybersecurity, ESG targets and environmental justice, as well as the risks associated with each. | | | Retirement policy | | | Our director retirement policy provides that no director who is over the age of 75 at the expiration of his or her current term may be nominated to a new term; however, in the best interests of our organization, a director may be asked to remain on the Board of Directors for an additional period of time beyond age 75, or to stand for re-election even if such director is over the age of 75. | | | Diversity policy | | | Our diversity policy addresses recruitment and selection protocols to ensure due consideration is given to the benefits of diversity and gender equity in determining qualified candidates for our Board of Directors and senior management. | | | Position descriptions | | | We have adopted position descriptions for the Board Chairman (including a Board Chairman that is an Executive Chairman), the lead independent director and the chairs of the committees of the Board of Directors, as well as a position description for our CEO. | |
Corporate Governance Corporate Governance Guidelines As part of our ongoing commitment to good corporate governance, we have adopted, among other measures, the Corporate Governance Guidelines and Board Charter, and charters for each of the standing committees of the Board of Directors (other than the Executive Committee) , to promote the effective functioning of our Board of Directors and its committees, to promote the interests of the Company as a whole and to ensure a common set of expectations concerning how our Board of Directors, its committees and management should perform their respective functions. Code
Our Board of ConductDirectors oversees the development and EthicsWeexecution of corporate governance strategy. The Board has adopted robust governance practices and procedures consistent with driving our business and meeting its business goals. Our Board has implemented a number of measures to enrich Board composition, enhance independent oversight and increase its effectiveness. These measures align our corporate governance structure with achieving our strategic objectives and enable our Board to effectively communicate and oversee our culture of compliance and rigorous risk management.
| | | THE BOARD’S ROLE IN RISK OVERSIGHT — BY COMMITTEE | | | | | | •
The Board of Directors and its committees have an active role in overseeing management of organizational risks. •
The Board of Directors regularly reviews information from members of our senior management team regarding our safety performance, employee retention, financial performance, financial outlook, balance sheet, credit profile and liquidity, as well as the risks associated with each. •
The Board of Directors also receives reports from members of senior and regional management on areas of material risk, including market-specific, operational, legal, information technology (including cybersecurity), regulatory and strategic risks. •
The Board of Directors, with recommendations from the Audit and Compensation Committees, approves and maintains a succession plan for the CEO and other senior management. | | | | | | •
The Audit Committee oversees management of financial, financial reporting and internal controls risk. | | | | | | •
The Compensation Committee assesses and monitors risks relating to corporate officer compensation policies and practices. | | | | | | Nominating and Corporate Governance Committee •
The Nominating and Corporate Governance Committee recommends director nominees to the Board of Directors, oversees an annual self-evaluation process to assess the effectiveness of the Board of Directors and its committees, and develops and implements corporate governance principles. | | |
OTHER AREAS OF BOARD OVERSIGHT Sustainability: ESG Targets Our Board of Directors and its committees have an active role in the Company’s efforts to advance sustainability objectives, including the development and approval of targets, monitoring achievement towards such objectives, and evaluating the effectiveness of policies and targets. In addition, the Board added ESG and sustainability 2022Notice of Annual Meeting & Proxy Statement7
targets as a performance measure in long-term incentive compensation beginning in 2021 as more fully described on page 35 in Compensation, Discussion and Analysis (“CD&A”). Human Capital: Diversity and Inclusion The Board of Directors and its committees also adoptedhave an active role in the Company’s efforts to advance diversity and inclusion, including through the addition of a CodeDiversity Policy in 2019, which provides for annual progress reviews by the Board of ConductDirectors. The Board of Directors and Ethics that appliesits committees also have responsibility for the oversight of efforts related to environmental justice (“EJ”) and understanding the local impact on our facilities. The U.S. Environmental Protection Agency describes EJ as the fair treatment and meaningful involvement of all people regardless of race, color, national origin or income with respect to the development, implementation and enforcement of environmental laws, regulations and policies. Our approach to community engagement and support aligns with the EPA’s view regarding fair treatment, and we endeavor to work with stakeholders to address their concerns. Board oversight of these efforts includes periodic updates on the analysis, identification and progress towards addressing any concerns or impacts. The Board of Directors receives reports on information technology risks, including cybersecurity and data security risks. Day-to-day management of data security is the responsibility of our directors, officersChief Information Officer, who reports directly to the CEO. The Board periodically reviews cybersecurity and employees. The Nominatingdata security risks and Corporate Governance Committee is responsiblemitigation strategies with the Chief Information Officer. We believe that our relationship with and accountability to shareholders are critical to our success. Engaging with our shareholders helps us understand how they view us, set goals and expectations for ensuring the Company implements goodour performance, and identify emerging issues that may affect our strategies, sustainability initiatives, corporate governance, compensation practices or other aspects of our business operations. Our shareholder and investor outreach includes investor road shows, analyst meetings, investor meetings and investor conferences, both virtually and in person. We also communicate with shareholders and other interested parties through various media, including complianceour annual and quarterly reports, sustainability reports, proxy statements and other SEC and Canadian securities filings, press releases and our website. Our conference calls to discuss quarterly earnings releases and major corporate developments are open to the public. These calls are available in real time and are archived as webcasts on our corporate website. Our CEO, Chief Financial Officer and other senior management regularly engage with investors to discuss our strategy, financial and business performance, and ESG efforts and to update investors on key developments. Communications With The Board Of Directors We encourage shareholders and other interested parties to communicate with the CodeBoard of Conduct and Ethics. Directors who have, or whoDirectors. You may be reasonably perceived to have, a personal or related-party interest in a transaction or agreement being contemplated by the Company are required to declare such interest at any meeting at which the matter is being considered and, when appropriate, will leave the meeting during discussion and abstain from voting on such matter.Copies of our Corporate Governance Guidelines and Board Charter, our Code of Conduct and Ethics and our committee charters are available on our website at www.wasteconnections.investorroom.com/corporate-governance. A copy of the Corporate Governance Guidelines and Board Charter is included as Appendix A to this Proxy Statement, and a copy of the Corporate Governance Guidelines and Board Charter and our Code of Conduct and Ethics may also be obtained, free of charge, by writingaddress your correspondence to the SecretaryBoard of Waste Connections, Inc., at our principal administrative offices located at Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380.
Committees ofDirectors generally, the non-employee directors as a group or a specific director.
| | | | | Write to Us | | | | Waste Connections, Inc.
Attn: Corporate Secretary
3 Waterway Square Place, Suite 110
The Woodlands, Texas 77380 | |
Our Board of Directors has four standing committees: the Executive Committee, the Audit Committee, the CompensationNominating and Corporate Governance Committee and the Nominating and Corporate GovernanceCompensation Committee. Except for the Executive Committee, all committees are composed entirely of independent, non-employee directors. Executive Committee
The Executive Committee, whose committee chairman is Mr. Ronald J. Mittelstaedt and whose other members are Messrs. Michael W. Harlan and Larry S. Hughes, is authorized to exercise, subject to limitations under applicable law, all of the powers and authority of the Board of Directors in managing our business and affairs, including approval, between meetings of the Board of Directors, of all divestitures by the Company in excess of $25.0 million and all acquisitions by the Company for cash or other non-equity consideration in excess of $25.0 million.
Audit Committee
The Board of Directors has a standing Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Audit Committee, whose chairman is Mr. Harlan and whose other members are Ms. Elise L. Jordan and Messrs. Hughes and William J. Razzouk, advises our Board of Directors and management with respect to, among other matters, internal controls, financial systems and procedures, accounting policies and other significant aspects of the Company’s financial management. Pursuant to its charter, the Audit Committee selects the Company’s independent registered public accounting firm, oversees the arrangements for, and approves the scope of, the audits to be performed by the independent registered public accounting firm, and annually assesses the performance of the independent registered public accounting firm. The Board of Directors has determined that all of the members of the Audit Committee are “financially literate” within the meaning of NYSE listing standards and applicable Canadian securities laws. The Board of Directors has also determined that Mr. Harlan and Ms. Jordan are both “audit committee financial experts” as defined under the applicable SEC rules. The Audit Committee’s duties are discussed below under “Audit Committee Report.”
WASTE CONNECTIONS, INC. 8
Waste Connections
| 2021 PROXY STATEMENT Corporate Governance5
| | Executive Committee 2021 Meetings: 2 | | | | Members: Ronald J. Mittelstaedt (Chair) Michael W. Harlan Larry S. Hughes | | | | Key Responsibilities: •
Authorized to exercise, subject to limitations under applicable law, all of the powers and authority of the Board of Directors in managing our business and affairs, including approval, between meetings of the Board of Directors, of all divestitures by the Company in excess of $25.0 million and all acquisitions for cash or other non-equity consideration in excess of $25.0 million. | |
| | Audit Committee 2021 Meetings: 4 | | | | Members: Michael W. Harlan (Chair) Larry S. Hughes Elise L. Jordan William J. Razzouk | | | | Role and Responsibilities: •
Advises our Board of Directors and management with respect to, among other matters, internal controls, financial systems and procedures, accounting policies and other significant aspects of financial management. •
Responsible for the selection, appointment, oversight, qualification, independence, performance, compensation and retention of our independent registered public accounting firm, including audit fee negotiations and approval. •
Selects the lead engagement partner, and as required by law, assures rotation of the lead partner every five years. •
Oversees the arrangements for, and approves the scope of, the audits to be performed by the independent registered public accounting firm, and annually assesses the performance of the independent registered public accounting firm. •
Reviews our internal controls and the objectivity of our financial reporting, and meets with appropriate financial personnel and our independent registered public accounting firm in connection with these reviews. •
Reviews the professional services provided by our independent registered public accounting firm, including its public financial reporting policies and practices, and the results of its annual audit as the Audit Committee may find appropriate or as may be brought to the Audit Committee’s attention; reviews such other matters concerning our accounting principles and financial and operating policies, controls and practices. | |
| | All members of the Audit Committee satisfy applicable independence requirements of the NYSE and applicable Canadian securities laws. The Board of Directors has determined that all members of the Audit Committee are “financially literate” within the meaning of NYSE listing standards and applicable Canadian securities laws. The Board of Directors has also determined that Mr. Harlan and Ms. Jordan are both “audit committee financial experts” as defined under the applicable SEC rules. Additional information about the Audit Committee is discussed below under “Audit Committee Report.” | |
| | Nominating and Corporate Governance Committee 2021 Meetings: 3 | | | | Members: Edward E. “Ned” Guillet (Chair) Michael W. Harlan Elise L. Jordan Susan “Sue” Lee | | | | Key Responsibilities: •
Recommends director nominees to the Board of Directors. •
Oversees an annual self-evaluation process to assess the effectiveness of the Board of Directors and its committees. •
Develops and implements corporate governance principles. See “Board Renewal; Board Performance Evaluation” for more information regarding the committee’s annual self-evaluation process. | |
2022Notice of Annual Meeting & Proxy Statement9
| | As a matter of policy, the Board of Directors applies the same additional independence requirements of the Audit and Compensation Committees to the members of the Nominating and Corporate Governance Committee. Each member of this committee therefore satisfies the independence requirements of the NYSE and applicable Canadian securities laws. | |
| | Compensation Committee 2021 Meetings: 4 | | | | Members: William J. Razzouk (Chair) Edward E. “Ned” Guillet Susan “Sue” Lee | | | | Key Responsibilities: •
Establishes our corporate officer compensation policies and administers such policies. •
Studies, recommends and implements the amount, terms and conditions of payment of any and all forms of compensation for our directors, NEOs and other corporate officers. •
Approves and administers any guarantee of any obligation of, or other financial assistance to, any officer or other employee. •
Approves the grant of restricted share units, performance share units, warrants and other forms of equity incentives to officers, employees and consultants. •
Renders recommendations to the Board of Directors concerning cash and equity-based compensation and benefits for non-employee directors. See “Compensation Discussion and Analysis — Executive Compensation” for more information regarding compensation and the Compensation Committee. | |
| | All members of the Compensation Committee satisfy applicable independence requirements of the NYSE and applicable Canadian securities laws. | |
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION Compensation Committee
The Compensation Committee, whose chairman is Mr. Razzouk and whose other members are Ms. Susan “Sue” Lee and Mr. Edward E. “Ned” Guillet, is responsible for, among other matters, establishing our corporate officer compensation policies and administering such policies. Pursuant to its charter, the Compensation Committee studies, recommends and implements the amount, terms and conditions of payment of any and all forms of compensation for our directors, NEOs and other corporate officers; approves and administers any guarantee of any obligation of, or other financial assistance to, any officer or other employee; and approves the grant of restricted share units, share options, warrants and other forms of equity incentives to officers, employees and consultants. The Compensation Committee also makes recommendations to the Board of Directors concerning cash and equity-based compensation and benefits for non-employee directors. See “Compensation Discussion and Analysis—Executive Compensation” for more information regarding compensation and the Compensation Committee.
Compensation Committee Interlocks and Insider Participation
In 2020, the Compensation Committee consisted of Ms. Lee and Messrs. Razzouk and Guillet.
None of our executive officers served as a director or member of the compensation committee of another entity which had an executive officer that served as a director or member of our Compensation Committee. In addition, there are no other such potential Compensation Committee interlocks. Nominating
Committee Assignments and Attendance | | | | | Committee Assignments | | | | Committee Member | | | Independent | | | Audit | | | Compensation | | | Executive | | | Nominating
& Corporate
Governance | | | | Edward E. “Ned” Guillet | | | • | | | | | | M | | | | | | C | | | | Michael W. Harlan | | | • | | | C | | | | | | M | | | M | | | | Larry S. Hughes | | | • | | | M | | | | | | M | | | | | | | Worthing F. Jackman | | | | | | | | | | | | | | | | | | | Elise L. Jordan | | | • | | | M | | | | | | | | | M | | | | Susan “Sue” Lee | | | • | | | | | | M | | | | | | M | | | | William J. Razzouk | | | • | | | M | | | C | | | | | | | | | | Ronald J. Mittelstaedt | | | | | | | | | | | | C | | | | | | | Number of Meetings in 2021 | | | Board = 4 | | | 4 | | | 4 | | | 2 | | | 3 | |
C = Chair M = Member
Corporate Governance CommitteeThe Nominating and Corporate Governance Committee, whose chairman is Mr. Guillet and whose other members are Mses. Jordan and Lee and Mr. Harlan, is responsible for, among other matters, recommending director nominees to the Board of Directors, overseeing an annual self-evaluation process to assess the effectiveness of the Board of Directors and its committees, and developing and implementing corporate governance principles. See “Board Renewal; Board Performance Evaluation” for more information regarding the committee’s annual self-evaluation process.
Copies of the Audit Committee Charter, the Compensation Committee Charter and the Nominating and Corporate Governance Committee Charter, each of which our Board of Directors has adopted, are available on our website at www.wasteconnections. investorroom.com/corporate-governance. A copy of each charter may also be obtained, free of charge, by writing to the Secretary of Waste Connections, Inc., at our principal administrative offices located at Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380.
Independence of Committee Members
In addition to the general requirements for the independent members of our Board of Directors described below, members of the Audit Committee and the Compensation Committee must also satisfy the additional independence requirements of the NYSE and applicable securities laws. These rules and laws, among other things, prohibit a member of the Audit Committee or the Compensation Committee, other than in his or her capacity as a member of such committee, the Board of Directors or any other committee of the Board of Directors, from receiving any compensatory fees from or being an affiliated person of the Company or any of its subsidiaries. As a matter of policy, the Board of Directors also applies this additional requirement to members of the Nominating and Corporate Governance Committee.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 6
BOARD AND COMMITTEE MEETING ATTENDANCE Board and Committee Meeting Attendance
The Board of Directors held four meetings during 2020,2021, all of which were regularly scheduled. Three of theTwo meetings were held via video conference, and two meetings were held in a hybrid manner with some Board members attending in-person and others attending via video conference. TheIn 2021, the Executive Committee met one time in 2020. Thetwo times; the Audit Committee met four times during 2020. Thetimes; the Compensation Committee met fivefour times, during 2020. Theand the Nominating and Corporate Governance Committee met four times during 2020.three times. Each director of Waste Connections attended at least 75%100% of the meetings of the Board of Directors held during 2020.2021. Each director of Waste Connections attended at least 75%100% of the meetings of the committees on which he or she served during 2020. The attendance record of2021. At each director for all Board of Directors and committee meetings held during 2020 is set out below.Name | | Board | | Executive
Committee | | Audit
Committee | | Compensation
Committee | | Nominating
and Corporate
Governance
Committee | Ronald J. Mittelstaedt | | 4/4 | | 1/1 | | N/A | | N/A | | N/A | Edward E. “Ned” Guillet | | 4/4 | | N/A | | N/A | | 5/5 | | 4/4 | Michael W. Harlan | | 4/4 | | 1/1 | | 4/4 | | N/A | | 4/4 | Larry S. Hughes | | 4/4 | | 1/1 | | 4/4 | | N/A | | N/A | Worthing F. Jackman | | 4/4 | | N/A | | N/A | | N/A | | N/A | Elise L. Jordan | | 4/4 | | N/A | | 4/4 | | N/A | | 4/4 | Susan “Sue” Lee | | 4/4 | | N/A | | N/A | | 5/5 | | 4/4 | William J. Razzouk | | 4/4 | | N/A | | 4/4 | | 5/5 | | N/A |
The Board’s Role in Risk Oversight
The Board of Directors and its committees have an active role in overseeing management of the Company’s risks. The Board of Directors regularly reviews information from members of senior management regarding the Company’s safety performance, employee retention, financial performance, financial outlook, balance sheet, credit profile and liquidity, as well as the risks associated with each. The Board of Directors also receives reports from members of senior and regional management on areas of material risk to the Company, including market-specific, operational, legal, information technology (including cybersecurity), regulatory and strategic risks. The Board of Directors, with recommendations from the Audit and Compensation Committees, approves and maintains a succession plan for the CEO and other senior management of the Company, including policies and principles for selecting and evaluating a new CEO in the event of an emergency or retirement of the CEO. The Audit Committee oversees management of financial, financial reporting and internal controls risk. The Compensation Committee assesses and monitors risks relating to the Company’s corporate officer compensation policies and practices. The Nominating and Corporate Governance Committee is responsible for overseeing the management of risks associated with the independencescheduled meeting of the Board of Directors, the non-employee directors also meet separately, without management present. As such, in 2021, the independent directors met four times without non-independent directors and potential conflicts of interest.
The Board of Directors receives reports on information technology risks, including cybersecurity and data security risks. Day-to-day management of data security is the responsibility of our Chief Information Officer, who reports directly to the Chief Executive Officer. The Board periodically reviews cybersecurity and data security risks and mitigation strategies with the Chief Information Officer.
The Board of Directors and its committees also have an active role in the Company’s efforts to advance sustainability and diversity and inclusion, including the development and approval of targets, monitoring achievement towards such objectives, and evaluating the effectiveness of policies and targets. In addition, the Board added ESG targets as a performance measure in long-term incentive compensation beginning in 2021.
present. The Board of Directors has determined that each of Mses. Jordan and Lee and Messrs. Guillet, Harlan, Hughes and Razzouk is “independent” within the meaning of the standards set forth in our Corporate Governance Guidelines and Board Charter, a copy of which is attached as Appendix A. Ronald J. Mittelstaedt and Worthing F. Jackman are not “independent” within the meaning of the standards set forth in our Corporate Governance Guidelines and Board Charter becauseCharter. Mr. Mittelstaedt, as the Executive Chairman of the Board of Directors, is an employee of the Company, and Mr. Jackman, isas the CEO of the Company, are each employees of the Company. WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 7
As set forth in our Corporate Governance Guidelines and Board Leadership Structure Charter, a majority of the members of our Board of Directors must be independent. For a director to be considered independent, the Board of Directors must determine that the director is “independent” within the meaning of (1) Section 1.4 of National Instrument 52-110 — Audit Committees of the Canadian Securities Administrators and (2) Section 303A.02 of the Listed Company Manual of the NYSE, in each case as such laws or rules, as applicable, may be amended or replaced. In addition, for a director to be considered independent, the Board of Directors must determine that the director has no material relationship with the Company, provided the direct or indirect ownership of any amount of the Company’s shares will not be deemed to constitute a material relationship. No independent director is: 1)
a former employee of the Company; 2)
a former employee or affiliate of any current auditor of the Company or its subsidiaries; 3)
a part of an interlocking directorate in which any NEO or other corporate officer of the Company serves on the compensation committee of another company that concurrently employs such director; or 4)
an immediate family member in any of the foregoing categories. A director cannot be classified as independent until three years after any such employment, affiliation or relationship has ceased. The Board of Directors selects its chairmanreviews all relationships of each director to assess whether any material relationship exists so as to impair that director’s independence. A “material relationship” means a direct or indirect commercial, industrial, banking, consulting, legal, accounting, charitable or familial relationship that is reasonably likely to affect the independent and objective judgment of the director in question, provided the direct or indirect ownership of any amount of our shares is not deemed to constitute a material relationship. The following commercial or charitable relationships are not considered to be material relationships that would impair a director’s independence: 1)
a director is an executive officer of another company that does business with the Company and the CEO in any way it considersannual sales to, be inor purchases from, the best interestsCompany are less than the greater of $1 million or two percent of the Company.annual revenue of the other company; 2)
a director is an executive officer of another company that is indebted to the Company, or to which the Company is indebted, and the total amount of either company’s indebtedness to the other is less than one percent of the total consolidated assets of the other company; and 2022Notice of Annual Meeting & Proxy Statement11
3)
a director serves as an officer, director or trustee of a charitable organization, and the Company’s discretionary charitable contributions to that organization are less than one percent of that organization’s total annual receipts. On an annual basis, the Board of Directors reviews whether its members satisfy these applicable independence tests before any member stands for re-election to the Board of Directors. Code of Conduct and Ethics | | We have adopted a Code of Conduct and Ethics that applies to all of our directors, officers and employees. The Nominating and Corporate Governance Committee is responsible for ensuring the Company implements good corporate governance practices, including compliance with the Code of Conduct and Ethics. Directors who have, or who may be reasonably perceived to have, a personal or related-party interest in a transaction or agreement being contemplated by the Company are required to declare such interest at any meeting at which the matter is being considered and, when appropriate, will leave the meeting during discussion and abstain from voting on such matter. The Nominating and Corporate Governance Committee is responsible for the review and annual updates to our Code of Conduct and Ethics. | | | | | | All corporate governance documents and policies are available at:
https://investors.wasteconnections.com/
corporate-governance | | | | | | | You may also request a copy of our Corporate Governance Guidelines and Board/Committee Charters, free of charge, by writing to: Waste Connections, Inc.
Attn: Corporate Secretary
3 Waterway Square Place,
Suite 110,
The Woodlands, Texas 77380 | |
The Board of Directors oversees the selection its Chairman and the CEO. Effective July 2019, the Board of Directors splitseparated the positionpositions of Board Chairman and CEO. The Board has determined that the Company iswe are best served by having Ronald J. Mittelstaedt, the Company’s founder, serve as the Board’s Executive Chairman. Mr. Mittelstaedt previously held the positions of Board Chairman and CEO from January 1998 until July 2019, when Mr. Mittelstaedt transitioned to the position of Executive Chairman andChairman. At that time, Worthing F. Jackman was promoted to CEO. Since Mr. Mittelstaedt no longer serves as both Board Chairman and CEO, our Corporate Governance Guidelines and Board Charter provides that the positions of Board Chairman and CEO be held by separate persons. Lead Independent Director Responsibilities
Our Corporate Governance Guidelines and Board Charter requires that at each regularly scheduled meeting of the Board of Directors, the non-employee directors meet separately, without management present, in executive session. The non-employee directors may also meet without management present at other times as determined by the lead independent director. Furthermore, whenWhen the Board Chairman is an affiliated director or a member of the Company’s management, or when the independent directors determine that it is in the best interests of the Company, the independent directors will appoint from among themselves a lead independent director (the “lead independent director”). The Board of Directors has designated the chairman of the Audit Committee Mr. Harlan, as the lead independent director. In addition to his otherIf the Board Chairman is an independent director, then the duties as a director and member of committees,for the lead independent director will:described below shall be part of the duties of the Board Chairman.
■ | | LEAD INDEPENDENT DIRECTOR RESPONSIBILITIES | | | | | | In addition to other duties as a director and member of committees, the lead independent director will: •
Preside at all meetings of the Board of Directors at which the Board Chairman is not present; | ■ | present •
Preside over each meeting of non-employee directors; | ■ | directors •
Have the authority to call meetings of non-employee directors; | ■ | directors •
Help facilitate communication between the Board Chairman, the CEO and the non-employee directors; | ■ | directors •
Advise with respect to the Board of Directors’ agenda; | ■ | agenda •
Ensure that the Board of Directors is able to function independently of management; | ■ | management •
Serve as the leader of the Board of Directors on matters of corporate governance; | ■ | governance •
If requested by major shareholders, ensure his or her availability for direct communication; | ■ | communication •
Ensure that all directors have an independent contact on matters of concern to them and ensure that the Board of Directors successfully discharges its fiduciary duties; | ■ | duties •
Provide guidance on, and monitor, the independence of each director to ensure the independence of a majority of the Board of Directors; | ■ | Directors •
Provide leadership to the Board of Directors if circumstances arise in which the Board Chairman has, or may be perceived to have, a conflict; | ■ | conflict •
Ensure that functions delegated to committees of the Board of Directors are carried out as representedrequired and results are reported to the Board of Directors; | ■ | Directors •
Work with the Board Chairman and the CEO, including helping to review strategies, define issues, maintain accountability and build relationships; | ■ | relationships •
In conjunction with the Nominating and Corporate Governance Committee, facilitate the review and assessment of individual director attendance and performance and the size, composition and overall performance of the Board of Directors and its committees; | ■ | committees •
In collaboration with the Board Chairman and the corporate secretary, ensure that information requested by individual directors, or the entire Board of Directors or committees of the Board of Directors is provided and meets their needs; and | ■ | needs •
Together with the Board Chairman, ensure the directors are knowledgeable about their obligations to the Company, and its securityholders, management, and other stakeholders and pursuant to applicable law.laws | | |
If the Board Chairman is an independent director, then the duties
Majority Voting for the lead independent director described above shall be part of the duties of the Board Chairman. As set forth in ourDirectors Our Corporate Governance Guidelines and Board Charter provides, in uncontested director elections, for our directors to be elected by the affirmative vote of a majority“majority of the membersvotes cast” with respect to his or her election at a meeting of ourshareholders, and each incumbent director who receives more “WITHHOLD” votes than votes “FOR” in respect of his or her election must tender their resignation from the Board of Directors must be independent. ForDirectors. A “majority of the votes cast” means the number of shares voted “FOR” a director’s election exceeds 50% of the number of the total votes cast with respect to that director’s election. The total votes cast for that director’s election will include votes “FOR” that director and “WITHHOLD” votes, but will exclude abstentions, broker non-votes, and failures to be considered independent,vote for that director’s election. Upon receipt of such a tendered resignation, the Nominating and Corporate Governance Committee of the Board of Directors must determine that the director is “independent” within the meaningor another independent committee of (i) Section 1.4 of National Instrument 52-110 – Audit Committees of the Canadian Securities Administrators and (ii) Section 303A.02 of the Listed Company Manual of the NYSE, in each case as such laws or rules, as applicable, may be amended or replaced. In addition, for a director to be considered independent, the Board of Directors must determinewill make a determination as to whether to recommend that the director has no material relationship with the Company, providedBoard of Directors accept or reject such resignation. The applicable committee is expected to recommend that the direct or indirect ownershipBoard of anyWASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 8
amount ofDirectors accept the Company’s shares will not be deemed to constitute a material relationship. Noresignation absent exceptional circumstances. The director who is a former employeethe subject of such determination is not permitted to participate in the deliberations or decisions of the Company, is a former employee or affiliatedeciding committee.
We must promptly publicly disclose the decision(s) of any current auditor of the Company or its subsidiaries, is a part of an interlocking directorate in which any NEO or other corporate officer of the Company serves on the compensation committee of another company that concurrently employs such director or has an immediate family member in any of the foregoing categories, can be independent until three years after such employment, affiliation or relationship has ceased.The Board of Directors reviews all relationshipsby a press release and a filing with the SEC and the applicable securities commissions or similar regulatory authorities in Canada. If the director’s
2022Notice of each director to assess whether any of themAnnual Meeting & Proxy Statement13
tendered resignation is a material relationship so as to impair that director’s independence. A “material relationship” means a directnot accepted by the deciding committee or indirect commercial, industrial, banking, consulting, legal, accounting, charitable or familial relationship that is reasonably likely to affect the independent and objective judgment of the director in question, provided that the directdoes not submit his or indirect ownership of any amount of our shares is not deemed to constitute a material relationship. The following commercial or charitable relationships are not considered to be material relationships that would impair a director’s independence: if a director of the Company (a) is also an executive officer of another company that does business with the Company and the annual sales to, or purchases from, the Company are less than the greater of $1 million or two percent of the annual revenue of that other company; (b) is an executive officer of another company that is indebted to the Company, or to which the Company is indebted, and the total amount of either company’s indebtedness to the other is less than one percent of the total consolidated assets of that other company; or (c) serves as an officer, director or trustee of a charitable organization, and the Company’s discretionary charitable contributions to that organization are less than one percent of that organization’s total annual receipts. The Board of Directors reviews annually whether its members satisfy these applicable independence tests before any member stands for re-electionher resignation to the Board of Directors.Board Composition
Board Renewal
The Company doesDirectors, such director will continue to serve until his or her successor is duly elected, or his or her earlier resignation or removal. If the director’s resignation is accepted by the deciding committee, or if a nominee for director is not limitelected and the time anominee is not an incumbent director, can serve on the Board of Directors. While director term limits could potentially assistthen the Board of Directors, in gaining fresh perspectivesits sole discretion, may fill any resulting vacancy.
Director Orientation and meeting diversity objectives, imposing director term limits means thatContinuing Education We provide access to appropriate orientation programs, sessions or materials for new members of the Board of Directors may losefor their benefit either prior to or within a reasonable period of time after their nomination or election to the contributionsBoard of longer servingDirectors. Board members have access to written materials and presentations by senior management regarding the directors’ legal and ethical responsibilities; our strategic plans, principal operating risks and financial statements; the material factors that affect our performance; the operation, significance and effects of incentive compensation programs and related party transactions; and other key policies and practices. Continuing education is provided through a number of opportunities, including visits to our operating locations, strategic and financial presentations by members of senior and regional management, and periodic presentations by outside experts on topics of interest. Directors are encouraged, but not required, to participate in outside continuing education programs that help directors who have developedstrengthen investor trust and stakeholder confidence. Written position descriptions for the Board Chairman, the lead independent director and each of the Committee chairs, as well as a deeper knowledge and understandingposition description for the CEO of our business and have a demonstrated track record for guiding the Company, through a long-term periodhave been approved by the Board of shareholder value creation.TheDirectors.
Board Composition Our Board of Directors believes that there are a number of mechanisms for ensuring renewalrefreshment of the Board of Directors without implementing director term limits, including the use of performance evaluations of the Board of Directors, mandatory retirement policies for directors, the identification of skills needed on the Board of Directors and succession planning. The Our Board of Directors has adopted a director retirement policy that provides that no director who is over the age of 75 at the expiration of his or her current term may be nominated to a new term. However, the Nominating and Corporate Governance Committee may determine that it would be in theour best interests of the Company to ask a director to remain on the Board of Directors for an additional period of time beyond age 75, or to stand for re-election even if such director is over the age of 75. Board and Committee Performance Evaluation The
Our Board of Directors and each committee perform an annual performance self-evaluation to assess, at a minimum, the effectiveness and adequacy of the meetings of the Board of Directors and its committees, the adequacy and timeliness of information provided to the Board of Directors by the Company’sour management team, the diversity of experience of individual directors and the contributions of each director. The evaluation process is overseen by the Nominating and Corporate Governance Committee and includes questionnaires completed by each director that take into account observations from previous assessments, current topics, and other input fromCommittee. As a result of this annual process, the Board of Directors. A complete set of responses is then reviewed by each committee and the Board of Directors. Based on feedback from the 2020 evaluation, the directors concluded that the Board of Directors and each of its committees functioned well together, and that the members of our Board of Directors were satisfied with the overall performance of the Board of Directors and each of its committees. WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 9
| | | QUESTIONNAIRES | | | | | | RESPONSES | | | | | | FEEDBACK | | | | | | Questionnaires are created by the Nominating and Corporate Governance Committee to address relevant topics and issues related to the Board of Directors | | | | | | Each director completes the questionnaires to document his or her observations and assessments about the current state of the Board and its committees on which such member serves; the responses are then reviewed by each committee and the Board of Directors | | | | | | Changes are implemented as necessary based on a thorough review of the responses | |
2022Notice of Annual Meeting & Proxy Statement15
Our
Director Nomination Process Our Board of Directors believes that directors must have the highest personal and professional ethics, integrity and values. They must be committed to representing the best interests of the Company and should be committed to serving on the Board of Directors for an extended period of time. They must have an objective perspective, practical wisdom, mature judgment and expertise, skills and knowledge useful to the oversight of our business. Our goal is to have a Board of Directors that represents diverse experiences at policy-making levels in business and other areas relevant to our activities, while encouraging a diversity of backgrounds, including with respect to gender, among the members of our Board of Directors. Our Board of Directors believes it is paramount to maintain flexibility in the nominating process in order to ensure that the most qualified available candidates are selected as circumstances dictate and the needs of the Company evolve. In identifying suitable candidates for nomination to the Board of Directors, the Nominating and Corporate Governance Committee will consider candidates on merit using objective criteria and with due regard for the benefits of diversity on the Board of Directors, including the level of representation of women on the Board of Directors. The Board of Directors consists of eight directors, of which two are women, representing 25% of the Board of Directors and 33% of the independent members of the Board of Directors. For additional discussion of our diversity policies and practices, see “Corporate Governance – Diversity Policy”.
Our Board of Directors maintains a competency matrix to assess its composition. The following graphics summarize the key experiences, skills and diversity represented on our Board of Directors.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 10
| | | PREREQUISITES FOR ALL NOMINEES | | | | | | Candidates must have: •
the highest personal and professional ethics, integrity and values and must be willing to adhere to our Code of Conduct and Ethics •
a commitment to serve in our best interests •
a willingness to devote the time necessary to be an active participant in the Board and committee meetings, as well as a desire to gain extensive knowledge of our industry, business strategies and operations | | | •
an objective perspective, practical wisdom, mature judgment •
a willingness and an ability to meet our director’s equity ownership guidelines •
an ability to interact positively and constructively with other directors and management •
a willingness to participate in a one-day new director orientation session •
a willingness to attend director educational forums or workshops to enhance the understanding of new and evolving corporate governance requirements | | |
| | 1 | | | SOURCE CANDIDATES | | | | | The Nominating and Corporate Governance Committee may solicit suggestions from: | | | | •
incumbent directors •
management •
third party advisors, business and personal contacts | | | •
shareholders (see shareholder nomination process on pages 17-18) •
third party search firms | |
| | 2 | | | IN-DEPTH EVALUATION OF CANDIDATES | | | | The Nominating and Corporate Governance Committee reviews the candidates with the following criteria in mind: | | | | •
reputation including merit of past accomplishments and relevant academic or business experience •
impact on the diversity of the Board, including with respect to gender •
independence standards, as well as potential conflicts of interest •
time commitments especially the number of other current public board memberships | | | •
expertise, skills and knowledge useful to the oversight of our business at any given time •
specific expertise and qualifications relevant to enhancement of our committees’ objectives •
any foreseeable adverse legal proceedings involving the candidate •
the size and composition of the Board of Directors | |
| | 3 | | | NARROW CANDIDATE POOL | | | | The Nominating and Corporate Governance Committee further defines the candidate pool using the following process: | | | | •
interviews are conducted by one or more members of the committee •
candidates complete directors’ and officers’ questionnaires •
meetings occur between candidates and members of management | |
| | 4 | | | RECOMMENDATION OF CANDIDATE TO THE BOARD | | | | If the Nominating and Corporate Governance Committee believes that a candidate would be a valuable addition to the Board of Directors, it will recommend the candidate for nomination. | | | | The Nominating and Corporate Governance Committee reviews a current Board member’s performance prior to nomination by: | | | | •
evaluating the director’s past performance and contributions to the Board of Directors, as well as committee participation | |
In addition to the foregoing qualities, the Nominating and Corporate Governance Committee will take a number of other factors into account in considering candidates as nominees for the Board of Directors, including the following: (i) whether the candidate is independent within the meaning of our Corporate Governance Guidelines and Board Charter; (ii) relevant business, academic or other experience; (iii) willingness and ability to attend and participate actively in Board of Directors and committee meetings and otherwise to devote the time necessary to serve, taking into consideration the number of other boards on which the candidate serves and the candidate’s other business and professional commitments; (iv) potential conflicts of interest; (v) whether the candidate is a party to any adverse legal proceeding; (vi) the candidate’s reputation; (vii) specific expertise and qualifications relevant to any committee that the candidate is being considered for, such as whether a candidate for the Audit Committee meets the applicable financial literacy or audit committee financial expert criteria; (viii) willingness and ability to meet our director’s equity ownership guidelines; (ix) willingness to adhere to our Code of Conduct and Ethics; (x) ability to interact positively and constructively with other directors and management; (xi) willingness to participate in a one-day new director orientation session; (xii) willingness to attend educational forums or workshops to enhance understanding of new and evolving governance requirements; and (xiii) the size and composition of the Board of Directors.
When seeking director candidates, the Nominating and Corporate Governance Committee may solicit suggestions from incumbent directors, management, third party advisors, business and personal contacts, and shareholders. The Nominating and Corporate Governance Committee may also engage the services of a third-party search firm to help identify and facilitate the screening and interview process of potential director nominees. After conducting an initial evaluation, the Nominating and Corporate Governance Committee will make arrangements for candidates it considers suitable to be interviewed by one or more members of the committee. Each candidate will be required to complete a standard directors’ and officers’ questionnaire, which is also completed by all of the directors annually. The Nominating and Corporate Governance Committee may also ask the candidate to meet with members of our management. If the Nominating and Corporate Governance Committee believes that the candidate would be a valuable addition to the Board of Directors, it will recommend the candidate for nomination to the Board of Directors. Before recommending a sitting director to be nominated for re-election at an annual meeting of shareholders, the Nominating and Corporate Governance Committee will consider the director’s past performance and contribution to the Board of Directors.
The Nominating and Corporate Governance Committee will apply the criteria described above when considering candidates recommended by shareholders as nominees for the Board of Directors.
| | 5 | | | RESULTS | | | | The Nominating and Corporate Governance Committee has achieved the following results: | | | | •
Added two new Directors to the Board in the last three years •
Increased the number of Board members with diverse backgrounds, perspectives and experiences at the policy-making levels of our business and other areas relevant to our activities | |
In addition, any of our shareholders may nominate one or more persons for election as a director of the Company at any meeting of shareholders called for the purpose of electing directors if the shareholder complies with the notice, information and consent provisions contained in our By-law No. 1. Pursuant to our By-law No. 1, to be considered for inclusion in our proxy materials, notice of a shareholder’s nomination of a person for election to the Board of Directors (the “Notice”) must be received by the Secretary of the Company in writing at the address listed on the first page of this Proxy Statement for the Meeting not later than the close of business on the 30th 30th day before the date of the annual meeting of shareholders; except that, if the first public announcement made by the Company of the date of the annual meeting of shareholders (the “Notice Date”) is less than 50 days prior to the date of the annual meeting of shareholders, notice by the shareholder may be given not later than the close of business on the 10th 10th day following the Notice Date. In the case of a special meeting that is not also an annual meeting, the notice must be given not later than the 15th 15th day following the applicable Notice Date. The notice must contain and be accompanied by certain information as specified in our By-law No. 1 and set forth below, including information about the shareholder providing the notice and the proposed nominee(s) (the “Proposed Nominee”). Shareholders making nominations must provide, among other things: ■ | Their name, business and residential address; | ■ | The number of securities of the Company beneficially owned, or controlled or directed, directly or indirectly, by the shareholder or any other person with whom the shareholder is acting jointly or in concert with respect to the Company or any of its securities as of the record date for the meeting and the date of the proxy notice; | ■ | Their interests in, or rights or obligations associated with, any agreements, arrangements or understandings, the purpose or effect of which is to alter, directly or indirectly, the person’s economic interest in a security of the Company or the person’s economic exposure to the Company; | ■ | Full particulars of any proxy, contract, relationship, arrangement, agreement or understanding pursuant to which such person, or any of his or her affiliates or associates, or any person acting jointly or in concert with such person, has any interests, rights or obligations relating to the voting of any securities of the Company or the nomination of directors to the Board of Directors; and | ■ | Any other information that would be required to be included in a dissident proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors pursuant to applicable law. |
•
Their name, business and residential address; •
The number of securities of the Company beneficially owned, or controlled or directed, directly or indirectly, by the shareholder or any other person with whom the shareholder is acting jointly or in concert with respect to the Company or any of its securities as of the record date for the meeting and the Notice Date; •
Their interests in, or rights or obligations associated with, any agreements, arrangements or understandings, the purpose or effect of which is to alter, directly or indirectly, the person’s economic interest in a security of the Company or the person’s economic exposure to the Company; •
Full particulars of any proxy, contract, relationship, arrangement, agreement or understanding pursuant to which such person, or any of his or her affiliates or associates, or any person acting jointly or in concert with such person, has any interests, rights or obligations relating to the voting of any securities of the Company or the nomination of directors to the Board of Directors; and •
Any other information that would be required to be included in a dissident proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors pursuant to applicable law. Additionally, shareholders nominating director candidates are required to disclose, among other things: ■ | The name, age, business and residential address of the Proposed Nominee; | ■ | The principal occupation, business or employment of the Proposed Nominee, both presently and within the past five years; | ■ | Whether the Proposed Nominee is a resident Canadian; |
WASTE CONNECTIONS, INC. •
The name, age, business and residential address of the Proposed Nominee; •
The principal occupation, business or employment of the Proposed Nominee, both presently and within the past five years; •
Whether the Proposed Nominee is a resident Canadian; 2022| 2021 PROXY STATEMENT Notice of Annual Meeting & Proxy Statement1117
■ | The number of securities of each class of securities of the Company or any of its subsidiaries beneficially owned, or controlled or directed, directly or indirectly, by the Proposed Nominee, as of the record date and the date of the proxy notice; | ■ | Full particulars of any relationship, agreement, arrangement or understanding, including financial, compensation and indemnity related relationships, agreements, arrangements or understandings, between the Proposed Nominee and the shareholder, or any affiliates or associates of, or any person or entity acting jointly or in concert with, the Proposed Nominee or the shareholder, in connection with the Proposed Nominee’s nomination and election as a director of the Company; and | ■ | Any other information that would be required to be included in a dissident proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors pursuant to applicable law. Such information must be promptly updated and supplemented so as to be accurate as of the Record Date. |
•
The number of securities of each class of securities of the Company or any of its subsidiaries beneficially owned, or controlled or directed, directly or indirectly, by the Proposed Nominee, as of the record date and the Notice Date; •
Full particulars of any relationship, agreement, arrangement or understanding, including financial, compensation and indemnity related relationships, agreements, arrangements, or understandings, between the Proposed Nominee and the shareholder, or any affiliates or associates of, or any person or entity acting jointly or in concert with, the Proposed Nominee or the shareholder, in connection with the Proposed Nominee’s nomination and election as a director of the Company; and •
Any other information that would be required to be included in a dissident proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors pursuant to applicable law. Such information must be promptly updated and supplemented so as to be accurate as of the Record Date. We recommend that any shareholder wishing to nominate a director at an annual meeting of shareholders review a copy of our By-law No. 1. | | | OUR DIVERSITY OBJECTIVES | | | | | | We believe diversity, and specifically gender diversity, is an important consideration in determining the composition of our Board of Directors and senior management team. We are committed to increasing the diversity of the Board of Directors and senior management over time by actively seeking qualified candidates who satisfy diversity objectives, among other criteria. We believe a truly diverse Board of Directors and senior management team will include and utilize differences in skills, expertise, and industry experience, as well as gender, race, ethnicity, religion, sexual orientation, physical ability, age and other distinctions to bring diverse perspectives to the decision-making process and help foster an inclusive workplace. | | | | | | In 2019, we established a Policy Regarding Diversity on the Board of Directors and in Senior Management Positions (the “Diversity Policy”). A copy of the Diversity Policy can be found on our corporate website at https://investors.wasteconnections.com/diversity-policy. | | | | | | DIVERSITY POLICY | | | | | | •
We established recruitment and selection protocols to ensure due consideration is given to the benefits of diversity and gender equity in determining qualified candidates. •
We require third-party search firms hired by us to include diverse candidates, especially women, on the short list of candidates presented for consideration. | | | •
The Nominating and Corporate Governance Committee conducts periodic reviews of our recruitment and selection protocols for Board members and senior management (including executive officers, as defined by applicable Canadian securities laws). Existing protocols for internal promotion and leadership development are also a part of its annual review process. | | | | | | SELECTION CRITERIA FOR BOARD MEMBERS AND SENIOR MANAGEMENT | | | | | | We target a diverse range of skills, expertise and industry experience in the following areas: | | | | | | •
Corporate governance •
Strategy •
Risk management •
Operations & materials management •
Sales & marketing | | | •
Mergers & acquisitions •
Public company C-Suite •
Human capital management •
Legal/regulatory | | | •
Finance/accountability •
ESG/sustainability •
Solid waste industry •
Information technology | | |
| | | We assess the following factors when determining the appropriate composition of our Board and management teams: | | | | | | •
Gender •
Race •
Ethnicity | | | •
Religion •
Sexual orientation •
Physical ability | | | •
Age | | | | | | SUCCESS OF OUR DIVERSITY POLICY | | | | | | Our Diversity Policy does not specify a formal target regarding the representation of women in senior management or executive officer positions, however, we are committed to increasing the diversity — including gender diversity — of our executive team over time, ensuring the most qualified candidates are selected as circumstances dictate and our needs evolve. We believe that a less formulaic approach, together with a rigorous search that seeks to include diverse and qualified candidates based on the relevant qualifications and criteria, will best serve our needs. | | | | | | The Company continues its efforts to identify additional women candidates for consideration as members of the Board of Directors and in senior management positions, such as the appointment of Ms. Jordan as the second woman elected to the Board, the promotion of Ms. Whitney to Executive Vice President and Chief Financial Officer in 2021, and the promotion of Susan Netherton to Senior Vice President - People, Training and Development in 2022. In October 2019, the Company established its aspirational target of women representing at least 30% of independent Board of Directors members by 2020, which was achieved following the appointment of Ms. Jordan to the Board of Directors. In addition, the Company has established an aspirational target of women representing at least 30% of the total Board of Directors by 2024. Currently, two out of eight members of our Board of Directors are women, representing 33% of independent Board members and 25% of total Board members, and the director nominees for the Meeting include two women. | | | | | | 33% | | | Female Representation 25% | | | 15.4% | | | | | | of our independent Board members are female (two of six) | | | of our Board is female (two of eight) | | | of our executive officers
are female (two executive officers) | | |
Board Skills, Experience and Diversity | Skills & Experience | | | | | | Edward E.
“Ned”
Guillet | | | Michael W.
Harlan | | | Larry S.
Hughes | | | Worthing
Jackman | | | Elise L.
Jordan | | | Susan
“Sue”
Lee | | | Ronald J.
Mittelstaedt | | | William J.
Razzouk | | | Audit/Financial Reporting | | | | | | | | | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | | | | | | | • | | | | | | • | | | | Compensation & Human Capital Management | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | | | | | ESG/Sustainability | | | | | | | | • | | | | | | | | | | | | • | | | | | | • | | | | | | | | | | | | • | | | | | | | �� | | | | | • | | | | Information Technology & Cybersecurity | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | Corporate Governance & Public Policy | | | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | Legal/Regulatory | | | | | | | | • | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | | | | | | | • | | | | | | | | | | Public Company Executive | | | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | Risk Management | | | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | Operations & Materials Management | | | | | | | | | | | | | | • | | | | | | | | | | | | • | | | | | | • | | | | | | | | | | | | • | | | | | | • | | | | Solid Waste Industry | | | | | | | | | | | | | | • | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | • | | | | Strategic Planning & M&A | | | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | Sales & Marketing | | | | | | | | | | | | | | • | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | • | | |
2022Notice of Annual Meeting & Proxy Statement19
Board Charter provides, in uncontested director elections, for our directors to be elected byComposition
| Demographic Background | | | | | | Edward E.
“Ned”
Guillet | | | Michael W.
Harlan | | | Larry S.
Hughes | | | Worthing
Jackman | | | Elise L.
Jordan | | | Susan
“Sue”
Lee | | | Ronald J.
Mittelstaedt | | | William J.
Razzouk | | | Nationality | | | Canada | | | | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | United States | | | | | • | | | | | | • | | | | | | | | | | | | • | | | | | | • | | | | | | | | | | | | • | | | | | | • | | | | Gender | | | Male | | | | | • | | | | | | • | | | | | | • | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | • | | | | | Female | | | | | | | | | | | | | | | | | | | | | | | | | | | | | • | | | | | | • | | | | | | | | | | | | | | | | Visible Minority | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | Age | | | Under 60 | | | | | | | | | | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | | | | | | 60 – 70 | | | | | • | | | | | | • | | | | | | • | | | | | | | | | | | | • | | | | | | • | | | | | | | | | | | | | | | | | 71+ | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | • | | | | Tenure on the Board | | | 1 – 5 Years | | | | | | | | | | | | | | | | | | | | | | | • | | | | | | • | | | | | | | | | | | | | | | | | | | | | | | 6 – 10 Years | | | | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | 11+ Years | | | | | • | | | | | | • | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | • | | | | | | • | | | | Independent | | | Yes | | | | | • | | | | | | • | | | | | | • | | | | | | | | | | | | • | | | | | | • | | | | | | | | | | | | • | | | | | No | | | | | | | | | | | | | | | | | | | | | | | • | | | | | | | | | | | | | | | | | | • | | | | | | | | |
| | | | |
Ronald J. Mittelstaedt
| | | | Residence: California, USA
Age: 58
Non-Independent Director since 1997 | | | Executive Chairman
Committee Membership: Executive; Chair
Board & Committee Attendance in 2021: 100%
Common Shares Owned or Controlled: 205,497 | | | | CAREER HIGHLIGHTS Mr. Mittelstaedt has been Executive Chairman since July 2019. From our formation in 1997 to July 2019, he served as Chief Executive Officer. Mr. Mittelstaedt has served as a director since 1997 and was elected Chairman in January 1998. He also served as President from 1997 through August 2004. Mr. Mittelstaedt has more than 33 years of experience in the solid waste industry and under his leadership, we have become the third largest company in the North American solid waste and recycling industry. Prior to his career in the solid waste and recycling industry, Mr. Mittelstaedt spent three years in the air freight industry. Mr. Mittelstaedt also established the RDM Positive Impact Foundation in 2004 to improve the lives of underprivileged and at-risk children. | | | OTHER PUBLIC, PRIVATE AND NOT-FOR-PROFIT BOARDS •
SkyWest, Inc. (NASDAQ: SKYW) (2013 to present) •
Teichert, Inc. (2020 to present) •
Pride Industries (2009 to present), a non-profit organization which provides manufacturing, supply chain, logistics and facilities services to public and private organizations nationwide, while creating jobs for people with disabilities EDUCATION •
BA degree, Business Economics with a finance emphasis, University of California at Santa Barbara | | | | REASONS FOR NOMINATION We believe Mr. Mittelstaedt’s qualifications to serve on our Board of Directors include his extensive experience in the solid waste industry, including as our founder, our CEO since the Company was formed in 1997 until July 2019, a director of the Company since its formation, and our Board Chairman since 1998. | |
| | | | |
Edward E. “Ned” Guillet
| | | | Residence: California, USA
Age: 70
Independent Director since March 2007 | | | Committee Memberships:
Compensation
Nominating and Corporate Governance; Chair
Board & Committee Attendance in 2021: 100%
Common Shares Owned or Controlled, including DSUs: 36,114 | | | | CAREER HIGHLIGHTS Mr. Guillet has been an independent freelance human resources consultant since January 2007. From October 2005 until December 2006, he was Senior Vice President, Human Resources for the Gillette Global Business Unit of The Procter & Gamble Company, a position he held after the merger of Gillette with Procter & Gamble. From July 2001 until September 2005, Mr. Guillet was Senior Vice President and Chief Human Resources Officer and an executive officer of The Gillette Company. He joined Gillette in 1974 and held a broad range of leadership positions in its human resources department. Mr. Guillet is a former member of Boston University’s Human Resources Policy Institute. | | | PRIOR PUBLIC COMPANY BOARDS •
CCL Industries, Inc. (XTSE: CCL.B) (2008 to 2019), the largest label company in the world providing innovative solutions to the Home & Personal Care, Food & Beverage, Healthcare & Specialty, Automotive, Electronic & Consumer Durables and Retail Apparel markets worldwide; chair, Human Resources Committee; member, Nominating and Governance Committee EDUCATION •
BA degree, English Literature and Secondary Education, Boston College | | | | REASONS FOR NOMINATION We believe Mr. Guillet’s qualifications to serve on our Board of Directors include his past experience on our Board of Directors, his substantial experience with human resources and personnel development matters, and the positions he has held with other publicly traded companies (including a publicly traded company in Canada). | |
2022Notice of Annual Meeting & Proxy Statement21
| | | | |
Michael W. Harlan
| | | | Residence: Texas, USA
Age: 61
Independent Director since May 1998 | | | Committee Memberships:
Audit; Chair
Executive
Nominating and Corporate Governance
Board & Committee Attendance in 2021:100%
Common Shares Owned or Controlled, including DSUs: 11,766 | | | | CAREER HIGHLIGHTS Mr. Harlan has served as Board Chairman and Chief Executive Officer of Principal Environmental, L.L.C. since September 2013. In September 2011, Mr. Harlan founded and has served as President of Harlan Capital Advisors, LLC, a private consulting firm focused on advising companies on operational matters, strategic planning, mergers and acquisitions, debt and equity investments, and capital raising initiatives. Prior to forming Harlan Capital Advisors, Mr. Harlan held numerous positions at U.S. Concrete, Inc., including most recently as its President and Chief Executive Officer from May 2007 until August 2011. Prior to founding U.S. Concrete in August 1998, Mr. Harlan held several senior financial positions with publicly traded companies, including chief financial officer, treasurer, and controller. Mr. Harlan currently serves on the University of Houston Honors College Advisory Board. Mr. Harlan is a Certified Public Accountant. | | | OTHER PRIVATE COMPANY BOARDS •
Brewer Crane Holdings, LLC (2018 to present) PRIOR PUBLIC COMPANY BOARDS •
U.S. Concrete, Inc. (NASDSAQ: USCR) (2006 to 2011) •
WiMi Hologram Cloud, Inc. (NASDAQ: WIMI) (2020 to 2021) EDUCATION •
BA degree, Accounting, University of Mississippi | | | | REASONS FOR NOMINATION We believe Mr. Harlan’s qualifications to serve on our Board of Directors include his past experience on our Board of Directors, his substantial experience in the solid waste industry, his significant experience in accounting and financial matters, including his extensive experience as a certified public accountant, his substantial experience with growth-oriented companies, and his prior experience as a director of other publicly traded companies. | |
| | | | |
Larry S. Hughes
| | | | Residence: British Columbia, Canada
Age: 70
Independent Director since May 2014 | | | Committee Memberships:
Audit
Executive Committee
Board & Committee Attendance in 2021: 100%
Common Shares Owned or Controlled, including DSUs: 19,289 | | | | CAREER HIGHLIGHTS Mr. Hughes is a retired executive and former attorney who currently provides consulting and advisory services. In June 2017, Mr. Hughes retired as an executive of West Fraser Timber Co. Ltd. (TSX/NYSE: WFG). Mr. Hughes served as West Fraser’s Senior Vice President from 2007 to 2011 with oversight of strategic planning, legal, environmental and safety matters. He served as Vice President, Finance and Chief Financial Officer from 2011 to 2017 with oversight of financial and accounting matters, as well as strategic planning, investor relations, corporate governance, and pension matters. Prior to joining West Fraser, Mr. Hughes had a successful 27-year career as a business attorney in Vancouver. | | | PRIOR PUBLIC COMPANY BOARDS •
Progressive Waste Solutions Ltd. (2014 to 2016)(4) •
West Fraser Timber Co. Ltd. (TSX/NYSE: WFG) (2002 to 2005) EDUCATION •
LL.B. degree, University of British Columbia •
BA degree, History, University of British Columbia | | | | REASONS FOR NOMINATION We believe Mr. Hughes’ qualifications to serve on our Board of Directors include his past experience on our Board of Directors, his significant experience in corporate financial, governance and legal matters, his experience with companies having operations in both the U.S. and Canada, and his experience as an officer of another publicly traded company in Canada. | |
(4)
Waste Connections, Inc. is a corporation organized under the affirmative votelaws of a “majority ofOntario, Canada. In 2016, the votes cast” with respect to his or her election at a meeting of shareholders, and each incumbent director who receives more “WITHHOLD” votes than votes “FOR” in respect of his or her election must resign from the Board of Directors. A “majority of the votes cast” means that the number of shares voted “FOR” a director’s election exceeds 50% of the number of the total votes cast with respect to that director’s election. The total votes cast with respect to that director’s election will include votes “FOR” that director and “WITHHOLD” votes, but will exclude abstentions, broker non- votes, and failures to vote with respect to that director’s election. Upon receipt of such a tendered resignation, the Nominating and Corporate Governance Committee of the Board of Directors or another independent committee of the Board of Directors will make a determination as to whether to recommend that the Board of Directors accept or reject such resignation. The applicable committee is expected to recommend that the Board of Directors accept the resignation absent exceptional circumstances. The director who is the subject of such determination is not permitted to participate in the deliberations or decisions of the deciding committee.The Company must promptly publicly disclose the decision(s) of the Board of Directors by a press release and a filing with the SEC and the applicable securities commissions or similar regulatory authorities in Canada. If the director’s tendered resignation is not accepted by the deciding committee or the director does not submit his or her resignation to the Board of Directors, such director will continue to serve until his or her successor is duly elected, or his or her earlier resignation or removal. If the director’s resignation is accepted by the deciding committee, or if a nominee for director is not elected and the nominee is not an incumbent director, then the Board of Directors, in its sole discretion, may fill any resulting vacancy.
Director Orientation and Continuing Education
The Company provides access to appropriate orientation programs, sessions or materials for new members of the Board of Directors for their benefit either prior to or within a reasonable period of time after their nomination or election to the Board of Directors, which include written materials and presentations by senior management regarding the directors’ legal and ethical responsibilities; our strategic plans, principal operating risks and financial statements; the material factors that affect our performance; the operation, significance and effects of incentive compensation programs and related party transactions; and other key policies and practices. Continuing education is provided through a number of opportunities, including visits to our operating locations, strategic and financial presentations by members of senior and regional management, and periodic presentations by outside experts on topics of interest. Directors are also encouraged, but not required, to participate in outside continuing education programs.
Communications with the Board of Directors
Shareholders and other interested parties may communicate with the Board of Directors generally, with the non-employee directors as a group or with a specific director at any time by writing to the Board of Directors, the non-employee directors or a specific director, care of the Secretary, at our principal administrative offices located atpredecessor corporation, Waste Connections, Inc., 3 Waterway Square Place, Suite 110, The Woodlands, Texas 77380. The Secretary will forward all communicationsa Delaware corporation, entered into a business combination with Progressive Waste Solutions Ltd., a corporation organized under the laws of Ontario, Canada (“Progressive Waste” and the transaction, the “Progressive Waste acquisition”). References to the “Company” and “Waste Connections” refer to the combined business after the business combination and to the Delaware corporation, now known as “Waste Connections US, Inc.”, before the Progressive Waste acquisition.
Board of Directors, the non-employee directors or a specific director, as applicable, as soon as practicable after receipt without screening the communication. Shareholders and otherWASTE CONNECTIONS, INC. Composition| 2021 PROXY STATEMENT 12
| | | | |
Worthing F. Jackman
| | | | Residence: Texas, USA
Age: 57
Non-Independent Director since 2019 | | | Board & Committee Attendance in 2021: 100%
Common Shares Owned or Controlled: 128,773 | | | | CAREER HIGHLIGHTS Worthing F. Jackman has been President and Chief Executive Officer since July 2019. From July 2018 to that date, he served as President. Mr. Jackman served as Executive Vice President and Chief Financial Officer from September 2004 to July 2018. From April 2003 to September 2004, he served as Vice President — Finance and Investor Relations. Mr. Jackman held various investment banking positions with Alex. Brown & Sons, now Deutsche Bank Securities, Inc., from 1991 through 2003, including most recently as its Managing Director within the Global Industrial & Environmental Services Group. In that capacity, he provided capital markets and strategic advisory services to companies in a variety of sectors, including solid waste services. | | | OTHER PUBLIC COMPANY BOARDS •
Quanta Services, Inc. (NYSE: PWR) (2005 to present) EDUCATION •
MBA degree, Harvard Business School •
BS degree, Finance, Syracuse University | | | | REASONS FOR NOMINATION We believe Mr. Jackman’s qualifications to serve on our Board of Directors include his extensive experience in the solid waste industry, including his senior leadership roles within the Company since 2003 and as our President and Chief Executive Officer and a director since July 2019. | |
| | | | |
Elise L. Jordan
| | | | Residence: Tennessee, USA
Age: 62
Independent Director since 2019 | | | Committee Memberships:
Audit
Nominating and Corporate Governance
Board & Committee Attendance in 2021: 100%
Common Shares Owned or Controlled, including DSUs: 3,661 | | | | CAREER HIGHLIGHTS Ms. Jordan is Executive Vice President and CFO of FedEx Express, the largest transportation company in the FedEx Corp. (NYSE: FDX) network. In that capacity, she is responsible for worldwide financial affairs, including financial planning, reporting and analysis, long-range strategic planning, and regional accounting and controls. Ms. Jordan has held a variety of positions with FedEx Express including Senior Vice President, Strategic and Financial Planning and Analysis and Business Systems; Vice President, Financial Planning; Managing Director, Global Financial Planning; and Manager, Corporate/Domestic Business Planning. She joined FedEx in 1983 as an Operations Analyst. Before joining FedEx, Ms. Jordan served as a Staff Auditor for Arthur Andersen LLC. | | | EDUCATION •
MBA degree, University of Memphis •
BBA degree, Accounting, University of Texas in Austin | | | | REASONS FOR NOMINATION We believe Ms. Jordan’s qualifications to serve on our Board of Directors include her significant experience in accounting, corporate finance, technology and governance, her senior positions within a multi-national logistics company, and her experience as an officer of another publicly traded company. | |
interested parties are requested to provide their contact information and to state the number
2022Notice of Common Shares that they beneficially own in their communications to the Annual Meeting & Proxy Statement23
Board of Directors. Because other appropriate avenues of communication exist for matters that are not of shareholder interest, such as general business complaints or employee grievances, shareholders and other interested parties are urged to limit their communications to the Board of Directors to matters that are of shareholder interest and that are appropriate for consideration by the Board of Directors.Shareholder Outreach
We believe that our relationship with and accountability to shareholders are critical to our success. Engaging with our shareholders helps us to understand how they view us, to set goals and expectations for our performance, and to identify emerging issues that may affect our strategies, sustainability initiatives, corporate governance, compensation practices or other aspects of our operations. Our shareholder and investor outreach includes investor road shows, analyst meetings, investor meetings and investor conferences, either virtually or in person. We also communicate with shareholders and other interested parties through various media, including our annual and quarterly reports, sustainability reports, proxy statements and other SEC and Canadian securities filings, press releases and our website. Our conference calls for quarterly earnings releases and major corporate developments are open to all. These calls are available in real time and are also archived as webcasts on our website. Our President and CEO, Chief Financial Officer and other senior management also regularly engage with investors to discuss our strategy, financial and business performance, and ESG efforts and to update investors on key developments.
Position Descriptions
Written position descriptions for the Board Chairman, the lead independent director and each of the committee chairs, as well as a position description for the CEO of the Company, have been approved by the Board of Directors.
Diversity Policy
The Company believes that diversity, and specifically gender diversity, is an important consideration in determining the composition of its Board of Directors and senior management and is committed to increasing the diversity of the Board of Directors and senior management over time by actively seeking qualified candidates who satisfy diversity objectives, among other criteria. A truly diverse Board of Directors and senior management will include and utilize differences in skills, expertise, and industry experience, as well as gender, race, ethnicity, religion, sexual orientation, physical ability, age and other distinctions to bring diverse perspectives to the decision-making process and help foster an inclusive workplace.
In October 2019, the Board of Directors adopted a Policy Regarding Diversity on the Board of Directors and in Senior Management Positions (the “Diversity Policy”) to formalize the Company’s belief that diversity is an important consideration in determining the composition of the Board of Directors and senior management. The Diversity Policy sets out specific roles and responsibilities of the Nominating and Corporate Governance Committee in recommending diverse candidates after considering a wide range of diversity criteria to ensure the Board of Directors, as a whole, and senior management reflect a range of viewpoints, backgrounds, skills and experience. In particular, the Diversity Policy emphasizes the importance of gender diversity and the role of women with relevant skills and experience in contributing to a diversity of perspective on the Board and senior management.
The Diversity Policy sets out various objectives of the Nominating and Corporate Governance Committee in order to achieve the Company’s commitment to increasing diversity, including the development of recruitment and selection protocols to give due consideration to the benefits of diversity and ensure candidates of diverse groups, knowledge and viewpoints are included in any director and senior management search. These protocols include considering the level of representation of women on the Board of Directors and senior management and directing any third-party search firm engaged by the Company to include diverse candidates, and in particular women, on the short list of candidates being considered in order to support the specific objective of gender diversity.
WASTE CONNECTIONS, INC. Composition| 2021 PROXY STATEMENT 13
| | | | |
Susan “Sue” Lee
| | | | Residence: British Columbia, Canada
Age: 70
Independent Director since 2014 | | | Committee Memberships:
Compensation
Nominating and Corporate Governance
Board & Committee Attendance in 2021: 100%
Common Shares Owned or Controlled, including DSUs: 17,172 | | | | CAREER HIGHLIGHTS Ms. Lee retired from Suncor Energy Inc. (“Suncor”) in April 2012, where she last served as Senior Vice-President, Human Resources and Communications. During her 16 years with Suncor, her responsibilities included executive compensation and succession planning, governance, merger strategy and integration, and stakeholder and government relations. Prior to joining Suncor, Ms. Lee had a 14-year career in human resources at TransAlta Corp. She has also served on the University of Calgary Board of Governors and the Women’s Executive Network Top 100 Women Advisory Board. In 2007, Ms. Lee was an inaugural inductee into the Hall of Fame for Canada’s Top 100 Most Powerful Women. | | | OTHER PUBLIC COMPANY BOARDS •
Empire Company Limited (TSX:EMP.A) (2014 to present); member, Human Resources Committee PRIOR PUBLIC AND PRIVATE COMPANY BOARDS •
Altalink (2011 to 2014) •
Bonavista Energy Corporation (2013 to 2017) •
Holcim Canada (2012 to 2014) •
Progressive Waste Solutions Ltd. (2014 to 2016) •
Suncor Energy Foundation (1998 to 2012) EDUCATION •
BA degree, Anthropology and Psychology, Rhodes University, South Africa •
Post Graduate Diploma, Organizational Behavior, Graduate School of Business Administration, University of Witwatersrand, South Africa •
Executive Development Program, University of Michigan | | | | REASONS FOR NOMINATION We believe Ms. Lee’s qualifications to serve on our Board of Directors include her past experience on our Board of Directors, her substantial experience with human resources and talent management and development matters, her substantial experience in the energy industry, the positions she has held with other publicly traded companies in Canada and her experience as a director of other publicly traded companies in Canada. | |
24
The Nominating and Corporate Governance Committee conducts periodic reviews of the Company’s recruitment and selection protocols for
Waste Connections
Board members and senior management (including executive officers, as defined by applicable Canadian securities laws), including the Company’s existing protocols for internal promotion and leadership development, as part of its annual review process. This review process aims to ensure that diversity remains a component of any director or senior management search and that existing protocols continue to promote diversity within the Company. The success of the Diversity Policy is measured by assessing whether the Board and senior management is composed of highly qualified individuals that possess a balance of skills, experience, expertise and a diversity of perspectives that are relevant to the Company’s business and its strategic objectives and determining whether the Company is meeting the aspirational targets set out in the Diversity Policy.The Company continues its efforts to identify additional women candidates for consideration as members of the Board of Directors and in senior management positions, such as the appointment of Ms. Jordan as the second woman elected to the Board and, in 2021, the promotion of Ms. Whitney to Executive Vice President and Chief Financial Officer from Senior Vice President and Chief Financial Officer. In October 2019, the Company established its aspirational target of women representing at least 30% of independent Board of Directors members by 2020, which was achieved in August 2019 following the appointment of Ms. Jordan to the Board of Directors. In addition, the Company has established an aspirational target of women representing at least 30% of the total Board of Directors by 2024. Currently, two out of eight members of our Board of Directors are women, representing 33% of independent Board members and 25% of total Board members, and the director nominees for the Meeting include two women.
Although the Diversity Policy does not specify a formal target regarding the representation of women in senior management or executive officer positions, we are committed to increasing the diversity – including gender diversity – of our executive team over time, ensuring that the most qualified candidates are selected as circumstances dictate and the Company’s needs evolve. Diversity is one of a number of factors (which include leadership capabilities, mature judgment, merit, an objective perspective, practical wisdom, talent, experience (including time with the Company), expertise, strategic/innovative thinking, skills and knowledge that are useful to the oversight of our business) that are considered in selecting the best candidates for executive officer appointments. We believe that a less formulaic approach, together with a rigorous search that seeks to include diverse and qualified candidates based on the relevant qualifications and criteria, will best serve the Company’s needs. Currently, there are two women who are executive officers (as defined under applicable Canadian securities laws) of the Company, or 16.6% of our executive officers.
WASTE CONNECTIONS, INC. Composition| 2021 PROXY STATEMENT 14
| | | | |
William J. Razzouk
| | | | Residence: Florida, USA
Age: 74
Independent Director since 1998 | | | Committee Memberships:
Audit
Compensation; Chair
Board & Committee Attendance in 2021: 100%
Common Shares Owned or Controlled, including DSUs: 18,860 | | | | CAREER HIGHLIGHTS Mr. Razzouk served as the Chairman and a Director of Newgistics, Inc. from March 2005 to October 2017. From March 2005 to December 2015, he also served as the President and Chief Executive Officer of Newgistics, Inc. From August 2000 to December 2002, Mr. Razzouk was a Managing Director of Paradigm Capital Partners, LLC, a venture capital firm in Memphis, Tennessee, focused on meeting the capital and advisory needs of emerging growth companies. From September 1998 to August 2000, he was Chairman of PlanetRx.com and Chief Executive Officer of PlanetRx.com from September 1998 until April 2000. Mr. Razzouk has served in numerous executive positions including President, Chief Operating Officer and a Director of Storage USA, Inc., and President and Chief Operating Officer of America Online. In addition, Mr. Razzouk held various management positions at Federal Express Corporation, ROLM Corporation, Philips Electronics and Xerox Corporation. Mr. Razzouk has owned a variety of businesses including a management consulting and investment company focused on strategic acquisitions. | | | PRIOR PUBLIC AND PRIVATE COMPANY BOARDS •
America Online (1996) •
Cordis Corp (OTCM: CORG) (1994 to 1996) •
Fritz Companies, Inc. (1998 to 2001) •
La Quinta Motor Inns (1994 to 1998) •
Newgistics, Inc. (2005 to 2017) •
PlanetRx.com (1998 to 2001) •
Sanifill, Inc. (1993 to 1996) •
Storage USA (1999 to 2000) EDUCATION •
BA degree, Journalism, University of Georgia | | | | REASONS FOR NOMINATION We believe Mr. Razzouk’s qualifications to serve on our Board of Directors include his past experience on our Board of Directors, his significant experience in corporate financial matters, his experience in the solid waste industry, his substantial experience with growth-oriented companies, and his prior experience as a director of other publicly traded companies. | |
2022Notice of Annual Meeting & Proxy Statement25
Director Compensation and Equity Ownership ANNUAL RETAINER AND EQUITY OWNERSHIPAnnual Retainer and Equity Grants
GRANTS All of our non-employee directors are paid an annual cash retainer and receive deferred share units or DSUs.(“DSUs”). The amount of such director compensation is determined on an annual basis by the Board of Directors. A supplemental annual cash retainer is also paid to committee chairs. Directors who are officers or employees of the Company do not receive any compensation as directors or for attending meetings of the Board of Directors or its committees. The Compensation Committee periodically engages its independent compensation consultant to review director compensation using the same peer group used to benchmark executive compensation. The principal features of the compensation received by our non-employee directors for fiscal year 20202021 are described below. | Type of Fee | | | | | Annual Cash Retainer | | $ | 100,000 | | | Committee Chair Cash Retainers: | | | | | | Audit | | $ | 25,000 | | | Compensation | | $ | 25,000 | | | Nominating & Corporate Governance | | $ | 15,000 | | | Target DSU/RSU Grant | | CAD$ | 210,000 | |
| | Type of Fee | | | | | | | | | | Annual Cash Retainer | | | | $ | 100,000 | | | | | Committee Chair Cash Retainers: | | | | | | | | | | Audit | | | | $ | 25,000 | | | | | Compensation | | | | $ | 25,000 | | | | | Nominating and Corporate Governance | | | | $ | 15,000 | | | | | Target DSU/RSU Grant | | | | CAD$ | 210,000 | | |
Non-employee directors may elect, irrevocably and in advance, to receive up to CAD$150,000 of their director grant in restricted share units, or RSUs that are settled in Common Shares, with the remainder to be received in the form of DSUs. RSUs received in payment of the director grant vest in two equal installments on the grant date and the first anniversary of the grant date. Pursuant to the participation
A letter agreement under the Separation Benefits Plan that was entered into on July 25, 2019, with Mr. Mittelstaedt as Executive Chairman,Chairman. Specifically, Mr. Mittelstaedt’s annual base salary is $500,000, his target annual cash bonus is 50% of his base salary, and the target amount of his annual equity awards is expected to be equal to 100% of his base salary (with RSUs constituting 50% of the total equity grant awarded, and PSUs constituting the remaining 50%). The following table provides compensation information for the year ended December 31, 2020,2021, for each non-employee member of our Board of Directors and Mr. Mittelstaedt as Executive Chairman of the Board of Directors. | Name | | Fees Earned
or Paid in
Cash ($)(1) | | | Share
Awards
($)(1)(2) | | | All Other
Compensation
($)(1)(3) | | | Total ($)(1) | | | Edward E. “Ned” Guillet | | | 115,000 | | | | 158,414 | | | | – | | | | 273,414 | | | Michael W. Harlan | | | 125,000 | | | | 158,414 | | | | – | | | | 283,414 | | | Larry S. Hughes | | | – | (4) | | | 158,414 | | | | – | | | | 158,414 | | | Elise L. Jordan | | | 100,000 | | | | 158,414 | | | | – | | | | 258,414 | | | Susan “Sue” Lee | | | 100,000 | | | | 158,414 | | | | – | | | | 258,414 | | | Ronald J. Mittelstaedt | | | 750,000 | | | | 550,193 | (5) | | | – | | | | 1,300,193 | | | William J. Razzouk | | | 125,000 | | | | 158,414 | | | | – | | | | 283,414 | |
(1) | | | Name | | | Fees Earned
or Paid in
Cash ($)(1) | | | Share
Awards
($)(1)(2) | | | All Other
Compensation
($)(1)(3) | | | Total ($)(1) | | | | Edward E. “Ned” Guillet | | | | | 115,000 | | | | | | 166,167 | | | | | | — | | | | | | 281,167 | | | | | Michael W. Harlan | | | | | 125,000 | | | | | | 166,167 | | | | | | — | | | | | | 291,167 | | | | | Larry S. Hughes | | | | | –(4) | | | | | | 166,167 | | | | | | — | | | | | | 166,167 | | | | | Elise L. Jordan | | | | | 100,000 | | | | | | 166,167 | | | | | | — | | | | | | 266,167 | | | | | Susan “Sue” Lee | | | | | 100,000 | | | | | | 166,167 | | | | | | — | | | | | | 266,167 | | | | | Ronald J. Mittelstaedt | | | | | 750,000 | | | | | | 851,693(5) | | | | | | — | | | | | | 1,601,693 | | | | | William J. Razzouk | | | | | 125,000 | | | | | | 166,167 | | | | | | — | | | | | | 291,167 | | |
(1)
Ms. Lee and Mr. Hughes received their compensation in Canadian currency. For purposes of this presentation, Canadian dollar amounts have been converted to U.S. dollars based on the Bank of Canada average rate of exchange for the period from January 1, 2020, to December 31, 2020, CAD$1.00 = US$0.7454. | (2) | In February 2020, each of our non-employee directors received a grant of 1,090 RSUs with a grant date fair value of $113,153 and a grant of 436 DSUs with a grant date fair value of $45,261, each as shown in the “Share Awards” column. The amount shown for each non-employee director is the grant date fair value of the 2020 awards computed in accordance with generally accepted accounting principles in the U.S., excluding estimates of forfeitures related to service-based vesting conditions. A discussion of the fair value of share awards is set forth under Note 1 of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 18, 2021. |
WASTE CONNECTIONS, INC. | 2021, PROXY STATEMENT 15
to December 31, 2021, CAD$1.00 = US$0.7980. | The table below shows the aggregate number of unvested share awards (in the form of RSUs, PSUs and DSUs, as applicable) outstanding for each non-employee director and the Executive Chairman as of December 31, 2020. |
| Name | | Aggregate
Restricted Share
Unit Awards
Outstanding as
of December 31,
2020 (#) | | | Aggregate
Performance
Share Unit Awards
Outstanding as
of December 31,
2020 (#) | | | Aggregate
Deferred Share
Unit Awards
Outstanding as
of December 31,
2020 (#) | | | Edward E. “Ned” Guillet | | | 545 | | | | – | | | | 2,446 | | | Michael W. Harlan | | | 545 | | | | – | | | | 2,446 | | | Larry S. Hughes | | | 545 | | | | – | | | | 7,837 | | | Elise L. Jordan | | | 545 | | | | – | | | | 940 | | | Susan “Sue” Lee | | | 545 | | | | – | | | | 5,471 | | | Ronald J. Mittelstaedt | | | 72,118 | | | | 27,533 | | | | – | | | William J. Razzouk | | | 545 | | | | – | | | | 2,446 | |
(3) | None of the non-employee directors nor Mr. Mittelstaedt received perquisites or other personal benefits in an aggregate amount of $10,000 or more. We reimburse directors for transportation, lodging and other expenses actually incurred in attending Board and committee meetings and other Company-related events. | (4) | Mr. Hughes irrevocably waived his entitlement to the $100,000 annual cash retainer for the year ended December 31, 2020, prior to the date that he would have otherwise been entitled to be paid such amount. Mr. Hughes requested that the Company direct an equivalent amount toward the Waste Connections Scholarship Program. | (5) | In February 2020, Mr. Mittelstaedt received a grant of 2,650 RSUs with a grant date fair value of $275,097 and a grant of 2,650 PSUs with a grant date fair value of $275,097, each as shown in the “Share Awards” column. The actual equity grant for Mr. Mittelstaedt exceeded the recommended target by approximately 9.0% due to an increase in the value of the Company’s share price prior to the grant date. The amount shown for Mr. Mittelstaedt is the grant date fair value of the 2020 awards computed in accordance with generally accepted accounting principles in the U.S., excluding estimates of forfeitures related to service-based vesting conditions. A discussion of the fair value of share awards is set forth under Note 1 of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 18, 2021. If the first-year performance hurdle is satisfied, annual RSU awards vest in four substantially equal annual installments beginning on the first anniversary of the grant date. |
(2)
In February 2021, each of our non-employee directors received a grant of 1,189 RSUs with a grant date fair value of $118,662 and a grant of 476 DSUs with a grant date fair value of $47,505, each as shown in the “Share Awards” column. The amount shown for each non-employee director is the grant date fair value of the 2021 awards computed in accordance with GAAP, excluding estimates of forfeitures related to service-based vesting conditions. A discussion of the fair value of share awards is set forth under Note 1 of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 17, 2022.
The table below shows the aggregate number of unvested share awards (in the form of RSUs, PSUs and DSUs, as applicable) outstanding for each non-employee director and the Executive Chairman as of December 31, 2021. | | Name | | | Aggregate
Restricted Share
Unit Awards
Outstanding as
of December 31,
2021 (#) | | | Aggregate
Performance
Share Unit Awards
Outstanding as
of December 31,
2021 (#) | | | Aggregate
Deferred Share
Unit Awards
Outstanding as
of December 31,
2021 (#) | | | | Edward E. “Ned” Guillet | | | | | 594 | | | | | | — | | | | | | 2,922 | | | | | Michael W. Harlan | | | | | 594 | | | | | | — | | | | | | 2,922 | | | | | Larry S. Hughes | | | | | 594 | | | | | | — | | | | | | 8,313 | | | | | Elise L. Jordan | | | | | 594 | | | | | | — | | | | | | 1,416 | | | | | Susan “Sue” Lee | | | | | 594 | | | | | | — | | | | | | 5,947 | | | | | Ronald J. Mittelstaedt | | | | | 18,294 | | | | | | 20,527 | | | | | | — | | | | | William J. Razzouk | | | | | 594 | | | | | | — | | | | | | 2,922 | | |
(3)
None of the non-employee directors nor Mr. Mittelstaedt received perquisites or other personal benefits in an aggregate amount of $10,000 or more. We reimburse directors for transportation, lodging and other expenses actually incurred in attending Board and committee meetings and other Company-related events. (4)
Mr. Hughes irrevocably waived his entitlement to the $100,000 annual cash retainer for the year ended December 31, 2021, prior to the date that he would have otherwise been entitled to be paid such amount, and requested the Company direct an equivalent amount toward the Waste Connections Scholarship Program. (5)
In February 2021, Mr. Mittelstaedt received a grant of 4,267 RSUs with a grant date fair value of $425,847 and a grant of 4,267 PSUs with a grant date fair value of $425,847, each as shown in the “Share Awards” column. The amount shown for Mr. Mittelstaedt is the grant date fair value of the 2021 awards computed in accordance with GAAP, excluding estimates of forfeitures related to service-based vesting conditions. A discussion of the fair value of share awards is set forth under Note 1 of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 17, 2022. Annual RSU awards vest in four substantially equal annual installments beginning on the first anniversary of the grant date. Non-Employee Director and Executive Chairman Equity Ownership Non-employee directors of the Company and the Executive Chairman are required to hold sharesCommon Shares having a market value of at least $300,000, or three times the annual cash retainer. The Executive Chairman is required to hold Common Shares having a market value of at least $1,500,000, or three times his annual base salary. Non-employee directors have five years from the fiscal year end following initial election to the Board of Directors to accumulate the share ownership prescribed by the guidelines. For purposes of the calculation, sharesCommon Shares deemed “beneficially owned” by the non-employee directors and the Executive Chairman within the meaning of the rules of the SEC, as well as DSUs and RSUs subject to time-based vesting held by the non-employee director and the Executive Chairman, as applicable, and vested or time-based unvested DSUs and RSUs or resulting shares deposited into a deferred compensation plan or arrangement, are included in the calculation of the amount of suchthe individual’s ownership. As of the date of this Proxy Statement, all of our non-employee directors (other than Ms. Jordan, who joined the Board of Directors in 2019) and the Executive Chairman exceeded the requirements of our share ownership guidelines. 2022Notice of Annual Meeting & Proxy Statement27
Non-employee directors and the Executive Chairman held the following Common Shares, DSUs and unvested RSUs as of March 16, 2021,15, 2022, the Record Date for the Meeting.| Name | | Common
Shares | | DSUs | | Unvested
RSUs | | Deferred
RSUs | | Total | | Equity Ownership
Guideline Met | | | Edward E. “Ned” Guillet | | 32,342 | | 2,922 | | 594 | | – | | 35,858 | |  | | | Michael W. Harlan | | 7,994 | | 2,922 | | 594 | | – | | 11,510 | | | | | Larry S. Hughes | | 10,126 | | 8,313 | | 594 | | – | | 19,033 | | | | | Elise L. Jordan | | 1,385 | | 1,416 | | 594 | | – | | 3,395 | | | | | Susan “Sue” Lee | | 10,398 | | 5,947 | | 594 | | – | | 16,939 | | | | | Ronald J. Mittelstaedt | | 190,201 | | – | | 4,267 | | 57,449 | | 251,917 | | | | | William J. Razzouk | | 15,088 | | 2,922 | | 594 | | – | | 18,604 | | | |
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 16
Date. | | Name | | | Common
Shares | | | DSUs | | | Unvested
RSUs | | | Deferred
RSUs | | | Total | | | Equity Ownership
Guideline Met | | | | Edward E. “Ned” Guillet | | | | | 32,843 | | | | | | 3,271 | | | | | | 485 | | | | | | — | | | | | | 36,599 | | | | | | | | Michael W. Harlan | | | | | 8,495 | | | | | | 3,271 | | | | | | 485 | | | | | | — | | | | | | 12,251 | | | | | | | | Larry S. Hughes | | | | | 10,627 | | | | | | 8,662 | | | | | | 485 | | | | | | — | | | | | | 19,774 | | | | | | | | Elise L. Jordan | | | | | 1,896 | | | | | | 1,765 | | | | | | 485 | | | | | | — | | | | | | 4,146 | | | | | | | | Susan “Sue” Lee | | | | | 10,876 | | | | | | 6,296 | | | | | | 485 | | | | | | — | | | | | | 17,657 | | | | | | | | Ronald J. Mittelstaedt | | | | | 205,497 | | | | | | — | | | | | | 6,713 | | | | | | 38,300 | | | | | | 250,510 | | | | | | | | William J. Razzouk | | | | | 15,589 | | | | | | 3,271 | | | | | | 485 | | | | | | — | | | | | | 19,345 | | | | | |
Directors’ Deferred Share Unit Plan DSUs are notional units that have the same value as Common Shares, and therefore have the same upside and downside risk as to value, but do not give the holder voting or other shareholder rights. Awarding DSUs to non-employee directors serves to align the interests of non-employee directors with those of shareholders. DSUs are redeemed and settled for cash or shares at the discretion of the Company, only when the non-employee director leaves the Board of Directors, and the redemption value of a DSU is equal to the market value of a Common Share at the date of redemption, less applicable withholdings. Non-employee directors may elect, irrevocably and in advance, to receive all or part of their director and committee chair cash retainers either in cash or DSUs. They may also elect, irrevocably and in advance, to receive up to CAD$150,000 of their upcoming equity grants in RSUs that are settled in Common Shares, with the remainder of such compensation to be received in the form of DSUs. Notional DSUs are credited to an account for each non-employee director and held until the non-employee director leaves the Board of Directors. DSUs earn dividend equivalents at the same rate as dividends are paid on Common Shares. uponUpon redemption and settlement, DSU holders are credited with additional DSUs that are equivalent in value to the dividends declared on the Common Shares. Public Company Board Memberships Under the terms of our Corporate Governance Guidelines and Board Charter, directors who also serve as chief executive officers or in equivalent positions at any company should not serve on more than two boards of public companies in addition to our Board of Directors, and other directors should not serve on more than four other boards of public companies in addition to our Board of Directors. Additionally, our Audit Committee Charter specifies that directors may not simultaneously serve on the audit committees of more than two other public companies unless our Board of Directors first determines such service will not impair the ability of the director to serve effectively on our Audit Committee. The director biographies list the other reporting issuers for which the Company’s directors serve as directors and the stock exchange on which those issuers are listed.
Share Ownership Share Ownership of Five Percent Shareholders The following table shows ownership information for any person or company known by our directors and executive officers to beneficially own, or control or direct, directly, or indirectly, 5% or more of the Common Shares. This information is presented as of the Record Date. | | Name of Beneficial Owner | | | Number of Outstanding
Common Shares
Beneficially Owned(1) | | | Percent
of Class | | | | The Vanguard Group(2) | | | 26,355,728 | | | 10.1% | | | | T. Rowe Price Associates, Inc.(3) | | | 26,244,971 | | | 10.0% | | | | BlackRock, Inc.(4) | | | 13,319,325 | | | 5.1% | |
(1)
Beneficial ownership is determined in accordance with the rules of the SEC. In general, a person who has voting power and/or investment power with respect to securities is treated as the beneficial owner of those securities. Except as otherwise indicated by footnote, the Company believes that the persons named in this table have sole voting and investment power with respect to the Common Shares shown. (2)
The Common Share ownership of The Vanguard Group is based on a Schedule 13G/A filed with the SEC on February 10, 2022. The Vanguard Group has sole voting power with respect to zero Common Shares and sole dispositive power with respect to 24,605,400 Common Shares. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, Pennsylvania 19355. (3)
The Common Share ownership of T. Rowe Price Associates, Inc. is based on a Schedule 13G/A filed with the SEC on February 14, 2022. T. Rowe Price Associates has sole voting power with respect to 8,518,542 Common Shares and sole dispositive power with respect to 26,244,971 Common Shares. The address of T. Rowe Price Associates, Inc. is 100 E. Pratt Street, Baltimore, Maryland 21202. (4)
The Common Share ownership of BlackRock, Inc. is based on a Schedule 13G filed with the SEC on February 4, 2022. BlackRock, Inc. has sole voting power with respect to 11,799,768 Common Shares and sole dispositive power with respect to 13,319,325 Common Shares. The address of BlackRock, Inc. is 55 East 52nd Street, New York, NY 10055. 2022Notice of Annual Meeting & Proxy Statement29
Share Ownership of the Board of Directors and Corporate Officers The following table sets forth information known to the Company concerning Common Shares beneficially owned, as of March 15, 2022, the Record Date for the Meeting, by (i) each director of the Company; (ii) each NEO of the Company; and (iii) all corporate officers and directors of the Company as a group. These individuals, both individually and in the aggregate, own less than 1% of our outstanding Common Shares as of the Record Date for the Meeting. | | Beneficial Owner(1) | | | Amount and
Nature of
Beneficial
Ownership(2) | | | Vested Restricted
Share Units
Held Under
Nonqualified
Deferred
Compensation
Plan(3) | | | Total | | | | Ronald J. Mittelstaedt | | | | | 205,497(4) | | | | | | 38,300 | | | | | | 243,797 | | | | | Worthing F. Jackman | | | | | 128,773 | | | | | | — | | | | | | 128,773 | | | | | Darrell W. Chambliss | | | | | 99,311 | | | | | | — | | | | | | 99,311 | | | | | Mary Anne Whitney | | | | | 50,036 | | | | | | — | | | | | | 50,036 | | | | | James M. Little | | | | | 38,812(5) | | | | | | — | | | | | | 38,812 | | | | | Edward E. “Ned” Guillet | | | | | 32,843 | | | | | | — | | | | | | 32,843 | | | | | Patrick J. Shea | | | | | 19,923 | | | | | | — | | | | | | 19,923 | | | | | William J. Razzouk | | | | | 15,589 | | | | | | — | | | | | | 15,589 | | | | | Susan “Sue” Lee | | | | | 10,876 | | | | | | — | | | | | | 10,876 | | | | | Larry S. Hughes | | | | | 10,627 | | | | | | — | | | | | | 10,627 | | | | | Michael W. Harlan | | | | | 8,495 | | | | | | — | | | | | | 8,495 | | | | | Elise L. Jordan | | | | | 1,896 | | | | | | — | | | | | | 1,896 | | | | | ALL CORPORATE OFFICERS AND DIRECTORS AS A GROUP
(28 PERSONS) | | | | | 824,638 | | | | | | 45,015 | | | | | | 869,653 | | |
(1)
Beneficial ownership is determined in accordance with the rules of the SEC. In general, a person who has voting power and/or investment power with respect to securities is treated as the beneficial owner of those securities. Except as otherwise indicated by footnote, and subject to applicable community property laws, the Company believes that the beneficial owners of the Common Shares, based on information furnished by such owners, have sole investment power and voting power with respect to such Common Shares. (2)
Common Shares subject to share options and/or warrants currently exercisable or exercisable within 60 days after March 15, 2022, Common Shares into which convertible securities are convertible within 60 days after March 15, 2022, and Common Shares which will become issuable within 60 days after March 15, 2022, pursuant to outstanding RSUs count as outstanding for computing the percentage beneficially owned by the person holding such share options, warrants, convertible securities and RSUs, but are not deemed to be outstanding for the purpose of computing the percentage ownership of any other person. (3)
Executive officers of the Company, in years prior to 2015, were able to voluntarily defer receipt of RSU grants under the Company’s Nonqualified Deferred Compensation Plan. The RSUs held under the Nonqualified Deferred Compensation Plan are not considered Common Shares that are beneficially owned for SEC disclosure purposes. The Company has included them in this table because they are similar to or track its Common Shares, they ultimately are settled in Common Shares, and they represent an investment risk in the performance of its Common Shares. (4)
Includes 205,497 Common Shares held by Mittelstaedt Enterprises, L.P., of which Mr. Mittelstaedt is a limited partner. Excludes 5,286 Common Shares held by the Mittelstaedt Irrevocable Trust dated 6/18/97 and 44,002 Common Shares held by RDM Positive Impact Foundation as to which Mr. Mittelstaedt disclaims beneficial ownership. (5)
Includes 12,602 Common Shares held by Mr. Little’s spouse.
Compensation Discussion & Analysis
Compensation Discussion and Analysis | | | | | | | �� | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | CD&A Appendix | | | 0 | | | | | | | | | | | | | | | | | | | | |
Our Named Executive Officers This Compensation Discussion and Analysis (“CD&A”) provides a detailed description of our executive compensation philosophy and objectives, the elements of our executive compensation program, the key executive compensation decisions made under those programs for 2021, and the factors considered in making those decisions. This CD&A is intended to provide additional context and background for the compensation earned by and awarded to our NEOs. Our NEOs for 2021 include the following individuals: Our executive compensation program is designed to align the interests of senior management with shareholders by attaching a significant portion of their compensation to our annual operating and financial performance, as well as longer term shareholder returns. We believe that our pay-for-performance philosophy and the design of our executive compensation program strongly supports an environment of continuous improvement and shareholder value creation. As described in the sections “Compensation Discussion and Analysis — Role of Independent Compensation Consultant” and “Comparator Group Compensation Data”, a review by the Compensation Committee’s independent compensation consultant in October 2021 concluded that, in aggregate, our targeted total direct compensation (“TDC”) for our NEOs was aligned with the 25th percentile of the Comparator Group (as defined below). It was also noted our annualized TSR was approximately at or above the 50th percentile for all measurement periods between five- and ten-year periods ending June 30, 2021, when compared to the Comparator Group. 2022Notice of Annual Meeting & Proxy Statement31
Compensation Discussion & Analysis
FINANCIAL AND COMPENSATION HIGHLIGHTS(5) Waste Connections delivered another strong year of operating and financial performance in 2021. Our results in the year are a reflection of how a culture of commitment and accountability to all stakeholders enabled us to excel in a challenging operating environment, overcome inflationary pressures and supply chain issues, execute on our growth strategy, expand margins and support employee health and welfare. In 2021, we continued our differentiated level of employee support totaling over $50 million to date since the onset of the COVID-19 pandemic primarily directed to our front line employees in the form of supplemental wages and paid time off for employees impacted by COVID-19. We also expanded the Waste Connections Scholarship Program and maintained the extended reach of our Employee Relief Fund to support those experiencing financial hardship. As illustrated below, our TSR significantly outperformed the S&P500, the TSX60 and the DJ Waste Index for the five-year period ended December 31, 2021. In addition, in October 2021, we increased our regular quarterly cash dividend by 12.4% to $0.23 per Common Share, the eleventh consecutive year of double-digit growth in our cash dividend since its commencement in 2010. 5-YEAR TOTAL SHAREHOLDER RETURN (5)
See page 2 for the footnote on non-GAAP financial measures.
Compensation Discussion & Analysis
A more detailed description of the Company’s fiscal year 2021 operating and financial performance, including a graphical representation of TSR performance for the S&P 500, TSX 60 and the DJ Waste Index, can be found on pages 49-75 and pages 47-48, respectively, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 17, 2022. Compensation Philosophy and Objectives Our Compensation Committee’s philosophy with respect to the compensation of the NEOs does not differ materially from its philosophy regarding other executive and corporate officers. The Committee believes that compensation paid to NEOs should closely align with our performance on both a short-term and long-term basis, be linked to specific, measurable results intended to create value for shareholders, and assist us in attracting and retaining key officers critical to our long-term success. In establishing compensation for NEOs, the Compensation Committee’s objectives are to: •
Attract and Retain Talent. Attract and retain individuals with superior leadership ability and managerial talent by providing competitive compensation and rewarding outstanding performance. •
Align with Shareholder Interests. Ensure that NEO compensation is aligned with our corporate strategies, business objectives and the long-term interests of our shareholders. •
Award Performance. Provide an incentive to achieve key strategic and financial performance measures by linking incentive award opportunities to the achievement of performance measures in these areas. •
Sustain Growth. Create an incentive for sustained growth. •
Achieve Balance. Provide a balanced approach to compensation policies and practices, which does not promote excessive risk-taking. Our overall executive compensation program is structured to attract and retain highly qualified executive and corporate officers by paying them competitively and consistent with our success. We believe that the compensation structure should ensure that a significant portion of pay directly relates to the performance of our Common Shares and other factors that directly and indirectly influence shareholder value. Accordingly, our approach to compensation is to provide base salary, an annual performance-based incentive opportunity tied to goals that link NEO compensation to our annual operating and financial performance, and long-term equity grants intended to align NEO compensation with shareholder returns and financial performance over a longer period and to aid in retention. Each year, the Compensation Committee allocates total compensation for the Company’s NEOs between cash and equity based on comparisons with other companies and the Compensation Committee’s judgment. EXECUTIVE COMPENSATION PROGRAM BEST PRACTICES Our executive compensation program includes features we believe drive performance and excludes features we believe do not serve our shareholders’ long-term interests. The table below highlights some of the “Best Practices” featured in our compensation program, as well as the “Problematic Pay Practices” that we have excluded. 2022Notice of Annual Meeting & Proxy Statement33
Compensation Discussion & Analysis
| Things We Do: | | | What We Don’t Do: | | | | | | | Pay for Performance. Our NEOs receive the majority (approximately 88% for the CEO, and approximately 81% for other NEOs, in 2021) of their TDC in performance-based compensation, which is contingent on Company and individual performance. Ratio of PSUs to total equity compensation at 50%. Our NEOs receive 50% of their long-term equity compensation as PSUs; the pay-out is contingent upon Company performance over a multi-year period. Relevant Performance Metrics. Our annual incentive and equity-based compensation programs include performance metrics meant to drive long-term shareholder value creation. Addition of ESG Metrics. We incorporated ESG and sustainability targets into equity-based compensation programs starting in 2021. Recoupment Policy. We maintain a clawback policy that permits our Board of Directors to seek the forfeiture or repayment of certain incentive compensation paid to an NEO or other corporate officer in certain circumstances. Annual Say-on-Pay Proposal. We provide our shareholders an annual opportunity to vote, on a non-binding, advisory basis, on the compensation of our NEOs. Use of Peer Group Data and Tally Sheets. We utilize tally sheets annually when making executive compensation decisions, and periodically review compensation data relative to our comparator group of companies (the “Comparator Group”). Share Ownership Guidelines. Our NEOs and other corporate officers are expected to hold Common Shares with a value equal to a multiple of their base salaries. Conservative Use of Equity Grants. Our annual equity grants have averaged approximately 0.30% of outstanding shares over the last five fiscal years. Risk Assessment. Our corporate officers’ compensation program has been designed, and is periodically reviewed, to ensure that it does not encourage inappropriate risk-taking. | | | | | | | No Compensation Guarantees. Our NEO employment agreements do not provide for guaranteed base salary increases, minimum bonuses or annual equity awards. No “Single Triggers”. Our CEO and other executive officers, as defined under applicable Canadian securities laws, have employment agreements that contain “double-trigger” change in control severance provisions. No Dividends on Unvested Equity Awards. We do not pay ordinary dividends on unvested time-based equity awards. For our PSUs, dividend equivalents are paid in cash, without interest, only when and to the extent the PSUs become vested. No Discounting, Re-pricing or Buyout Provisions. We expressly prohibit the discounting of share options and the re-pricing or cash buyouts of underwater share options. No Hedging or Pledging of Securities. NEOs, corporate officers, and directors are prohibited from engaging in transactions designed to hedge against the economic risks associated with an investment in Common Shares. In addition, these individuals may not pledge Common Shares as collateral unless preauthorized to do so in certain limited situations. | |
PAY FOR PERFORMANCE COMPENSATION MIX Our executive compensation program is designed to reward our NEOs and other corporate officers for achieving strong operational performance and delivering on the Company’s strategic initiatives, both of which are important to the long-term success of the Company. Based on the Company’s long-term and consistent record of strong financial performance and superior shareholder returns, our compensation program has remained relatively unchanged over the years. The Compensation Committee believes a significant portion of the compensation of our NEOs should be aligned with our shareholders’ interests and directly linked to measurable performance. To evaluate the proportion of performance-based compensation for our NEOs, the Compensation Committee looks at recurring compensation by examining the TDC earned by our NEOs. TDC is calculated by adding base salary, actual cash annual incentives paid and the grant date fair value of share awards, each as reported in our Summary Compensation Table. It excludes indirect compensation reported under the “All Other Compensation” column of our Summary Compensation Table. In 2021, At-Risk Compensation, comprised of cash incentives and equity-based compensation, made up approximately 88% of the TDC of our CEO and 81% of the combined TDC of our other NEOs.
Compensation Discussion & Analysis
| | We provide our shareholders with an opportunity to cast an annual non-binding advisory vote with respect to our NEO compensation, as disclosed herein, referred to as the Say-on-Pay Proposal. In 2021, more than 97% of the Common Shares voted approved of our NEO compensation program. Our Compensation Committee and the Company viewed these results as a strong indication our shareholders’ support our executive compensation policies and practices. | | | | |
Noteworthy Compensation Actions for 2021 The Company’s management and Compensation Committee, with the input of the full Board of Directors and the Compensation Committee’s independent compensation consultant, have periodically reviewed our executive compensation program and made certain revisions over the years to further align pay with performance. In light of our shareholders’ support and the Company’s significant shareholder value creation over the years, the Compensation Committee decided to retain the core design of our executive compensation program for fiscal 2021. The Compensation Committee took additional noteworthy actions in February 2021: •
Incorporated ESG Targets into Long-Term Compensation: In October 2020, the Company adopted long-term, aspirational sustainability targets and committed over $500 million for investments to meet or exceed such targets. These targets primarily focus on reducing emissions, increasing resource recovery of both recyclable commodities and clean energy fuels, reducing reliance on off-site disposal for landfill leachate, increasing employee engagement and retention, and further improving our industry-leading safety performance. The Company views its ESG/sustainability initiatives to be consistent with its objective of long-term value creation. Accordingly, beginning in February 2021, the Compensation Committee introduced continuous improvement towards the Company’s sustainability targets as an additional performance measure of our PSU grants, accounting for 15% of target achievement. •
Assessed COVID-19 Impact to Long-Term Compensation: Throughout the COVID-19 pandemic, the Compensation Committee assessed impacts from the COVID-19 pandemic on the Company’s financial results and incentive compensation program. When assessing the Company’s performance, the Compensation Committee considered the following factors in its review: (i) the Company’s differentiated response to the COVID-19 pandemic and related employee support; (ii) the Company’s continuing strong operating and financial performance, liquidity and capital position; (v) further improvements in safety, employee engagement and voluntary turnover; (vi) establishment of long-term, aspirational ESG targets; and (vi) sector-leading TSR among large cap peers. With the considerations noted above and input from its independent compensation consultant, the Compensation Committee made the determination to leave the metrics for the outstanding PSUs granted in 2019 and 2020 unchanged and without future positive discretion in spite of the likely material negative impact to those performance-based grants, including an expected zero vesting value for the 2019 PSU grants in February 2022, which zero vesting was subsequently certified in February 2022. In addition, the Compensation 2022Notice of Annual Meeting & Proxy Statement35
Compensation Discussion & Analysis
Committee decided to increase the value of the long-term equity award grants in 2021 and 2022 for all participants in the Company’s PSU program. For all officers, including NEOs, the increase in grant values averaged approximately 30% above target in 2021. ROLE OF THE COMPENSATION COMMITTEE The Compensation Committee has the primary authority for the consideration and determination of the cash and equity compensation we pay our executive and corporate officers. The Compensation Committee also makes recommendations to the Board of Directors concerning cash and equity-based compensation and benefits for non-employee directors. To aid the Compensation Committee, the CEO meets with the Compensation Committee and provides recommendations annually to the Compensation Committee regarding the compensation of the other NEOs and corporate officers. However, the Compensation Committee is not bound to follow the CEO’s recommendations. Pursuant to its charter, the Compensation Committee has the authority to engage its own independent advisors to assist in carrying out its duties. The Compensation Committee holds executive sessions not attended by any members of management or non-independent directors. The Compensation Committee meets in the first quarter of each fiscal year to review and approve: •
The achievement of financial performance goals for the prior fiscal year and, if applicable, a multi-year period; •
Performance-based compensation, if earned, based on such achievement for the prior fiscal year and, if applicable, a multi-year period; •
Annual equity-based compensation grants; •
Financial goals for performance-based awards; and •
The level and mix of NEO compensation for the current fiscal year. In determining the base salary, performance-based compensation and long-term equity-based compensation levels for the NEOs, the Compensation Committee considers: (1) the compensation structure and practices of a comparator group of companies that it believes are the Company’s leading competitors in the solid waste industry; (2) a comparator group of companies, most of which operate outside the solid waste industry, with comparable financial profiles; and (3) its own judgment as to an appropriate level of compensation for a company of our size and financial performance. From time to time, the Compensation Committee uses compensation consultants and comparator group analyses from third parties to assess our compensation components. For 2021, the Compensation Committee maintained the percentage of PSU awards as a proportion of total equity compensation at 50%. The Compensation Committee believes that achieving a +/- 10% range, over time, of median market Comparator Group target TDC for our existing NEOs is appropriate given their extensive experience, knowledge and their impact on the long-term success of the Company. For 2021, the Compensation Committee considered a tally sheet that included, for each NEO and other corporate officers, (1) current base salary; (2) salary paid in 2020; (3) bonus percentage; (4) cash bonus paid for 2020; (5) RSUs and PSUs granted in 2020; (6) the dollar amount of 401(k) and Nonqualified Deferred Compensation Plan matches in 2020; (7) payments and reimbursements for various expenses that could be considered perquisites; and (8) the value of unvested RSUs and PSUs as of the end of 2020. In determining the amount of compensation for the NEOs, the Compensation Committee does not consider amounts realized from prior equity-based compensation grants because the Compensation Committee seeks to provide compensation that takes into account the cost of replacing the NEO on a market competitive basis and what is equitable based on our performance. We believe that, to some extent, appreciation reflected in the amounts realized from prior equity-based compensation grants confirms the Compensation Committee’s success in aligning compensation with our shareholders’ interests. EXERCISE OF DISCRETION IN EXECUTIVE COMPENSATION DECISIONS As a risk mitigation provision, the Compensation Committee has complete discretion to withhold payment pursuant to any of our incentive compensation plans irrespective of whether we or the NEOs have successfully met the goals set under those plans.
Compensation Discussion & Analysis
ROLE OF INDEPENDENT COMPENSATION CONSULTANT The Compensation Committee periodically retains Pearl Meyer & Partners, LLC (“Pearl Meyer”) to provide market data and information regarding market practices and trends, assess the competitiveness of our executive compensation program, compare our performance relative to a Comparator Group, assist with the development of the Compensation Discussion and Analysis in this Proxy Statement, and provide analysis on our non-employee director compensation. The Compensation Committee retains Pearl Meyer directly, supervises all work assignments performed by the firm, and reviews and approves all work invoices received for payment. As required under Item 407(e)(3) of Regulation S-K, the Compensation Committee annually assesses whether the work of Pearl Meyer raises any conflict of interest. No conflict of interest was determined to exist with respect to Pearl Meyer’s services as a compensation consultant during the last fiscal year. COMPARATOR GROUP COMPENSATION DATA The Compensation Committee periodically analyzes the compensation practices of a Comparator Group to assess our competitiveness with the market. In doing so, it takes into account factors such as the relative size and financial performance of those companies and factors that differentiate us from them. Criteria used for establishing the Comparator Group include (1) organization size, with financial characteristics such as revenue, free cash flow, capital expenditures, EBITDA, market capitalization or enterprise value similar to those of the Company, (2) country of domicile, including Canada and the United States, and (3) industry, including companies in the environmental, facilities and diversified support services, transportation, oil and gas equipment and services, distribution and construction materials industries. Due to limited peers in Canada, the industry criteria was broader for Canadian companies. The Compensation Committee independently retained Pearl Meyer in late 2021 to review the compensation of the Company’s NEOs against the Comparator Group and survey information of similarly sized organizations. As part of that review, the Compensation Committee updated the Comparator Group to remove Fortis Inc. and Iron Mountain Incorporated and add Fortive Corporation and Kansas City Southern. The updated Comparator Group includes the following companies: | | | Air Products and
Chemicals, Inc. | | | Fortive Corporation | | | Old Dominion
Freight Line, Inc. | | | Vulcan Materials
Company | | | | | | Canadian Pacific Railway
Limited | | | J.B. Hunt Transport
Services, Inc. | | | Republic Services, Inc. | | | Waste Management, Inc. | | | | | | Cintas Corporation | | | Kansas City
Southern | | | United Rentals, Inc. | | | W.W. Grainger, Inc. | | | | | | Fastenal Company | | | Martin Marietta
Materials, Inc. | | | | | | | | |
Pearl Meyer concluded that, in aggregate, the Company’s targeted TDC for the NEOs was aligned with the 25th percentile of market comparables, with the CEO falling below the 25th percentile. It was also noted that our annualized TSR was close to or above the 50th percentile for all measurement periods between five- and ten-year periods ending June 30, 2021, when compared to the Comparator Group. Our Compensation Committee believes that a significant portion of the compensation of our NEOs should align with our shareholders’ interests and be directly linked to performance. While the exact pay mix of our NEOs’ total compensation (base salary, annual incentives, and equity-based compensation) is not specifically determined, the Compensation Committee generally targets annual incentives and equity-based compensation for our NEOs to constitute between 70% and 80% of TDC, assuming target level pay-outs are achieved; this is consistent with the market consensus data for the Comparator Group provided by Pearl Meyer in 2021. In aggregate for the NEOs, base salaries and target total cash compensation (base salaries plus annual incentives) were in line with the 25th percentile of the levels of compensation among Comparator Group executives, and TDC was aligned slightly below the market 25th percentile. The Compensation Committee has complete discretion to determine compensation levels. 2022Notice of Annual Meeting & Proxy Statement37
Compensation Discussion & Analysis
Base Salary Our compensation program includes base salaries to compensate the NEOs and other corporate officers for services rendered each year. Base salaries provide a secure base of compensation that is not dependent on our performance and is an amount that recognizes the role and responsibility of each NEO and other corporate officer, as well as such officer’s experience, performance and contributions. We also believe this element is beneficial in attracting and retaining high-performing and experienced corporate officers. The Compensation Committee considers base salary increases for certain NEOs and other corporate officers annually. Base salary decisions generally reflect the Compensation Committee’s consideration of our Comparator Group data and subjective factors including an officer’s experience and past performance. For 2021, the Compensation Committee approved the following annualized base salaries for our NEOs: | | Name | | | 2020
Base Salary
($) | | | 2021
Base Salary
($) | | | %
Increase/
Decrease | | | | Worthing F. Jackman | | | | | 900,000 | | | | | | 900,000 | | | | | | 0.0% | | | | | Mary Anne Whitney | | | | | 500,000 | | | | | | 550,000 | | | | | | 10.0% | | | | | Darrell W. Chambliss | | | | | 542,000 | | | | | | 555,000 | | | | | | 2.4% | | | | | Patrick J. Shea | | | | | 442,000 | | | | | | 460,000 | | | | | | 4.1% | | | | | James M. Little | | | | | 436,000 | | | | | | 447,000 | | | | | | 2.5% | | |
In determining 2022 base salaries for our NEOs, the Compensation Committee increased Ms. Whitney’s and Messrs. Chambliss, Shea and Little’s base salaries by approximately 3.0%, effective February 1, 2022. The base salary increase for Mr. Jackman was approximately 10%, part of a multi-year approach to increase his targeted direct compensation towards or within a +/- 10% range of the median market Comparator Group. Mr. Jackman’s base salary did not increase in 2021. Annual Incentives: Management Incentive Compensation Program Our compensation program includes an annual cash incentive award to reward NEOs and other corporate officers based on our performance and the individual executive’s contribution to that performance. Under our Management Incentive Compensation Program (the “MICP”), which is administered pursuant to our 2016 Incentive Award Plan (the “2016 Plan”), a summary of which is attached as Appendix B, each participant has an opportunity to earn an annual incentive based on a targeted percentage of the participant’s annual base salary for the year. The objective of the annual incentive is to encourage participants to manage the Company to achieve financial performance targets based on budgeted revenue. Under the MICP, the NEOs and other corporate officers of the Company are eligible to receive annual incentives. For 2021, the target annual incentives as a percentage of salary for the NEOs were as follows: | | Name | | | Target Incentive
(as a % of Base Salary) | | | | Worthing F. Jackman | | | 150% | | | | Mary Anne Whitney | | | 90% | | | | Darrell W. Chambliss | | | 90% | | | | Patrick J. Shea | | | 90% | | | | James M. Little | | | 90% | |
In 2021, each NEO had the opportunity to earn up to 200% of such person’s target annual incentive based on our achievement of certain targeted levels of financial performance established by the Compensation Committee and (other than with respect to Mr. Jackman) based on the recommendations of the CEO. The Compensation Committee adopted the performance targets for the fiscal year in February 2021. Our performance was compared to target levels of: (1) EBITDA, weighted at 20%; (2) operating income, or EBIT, weighted at 20%; (3) operating income as a percentage of revenue, or EBIT Margin, weighted at 30%; and (4) net cash provided by operating activities as a percentage of revenue, or CFFO Margin, weighted at 30%. Payouts are determined based on our weighted average achievement relative to each metric (the “multiplier”). Because the
Compensation Discussion & Analysis
Compensation Committee believes the operating budget adopted by our Board of Directors is a compilation of stretch goals set for each operating location, the targeted performance goals reflect a percentage or factor of the final budget, consistent with the prior year, as set forth below. | | | | | Weighting | | | Original 2021
Budget | | | 2021
Factor | | | 2021 Targeted
Performance Goal | | | | EBITDA | | | | | | | $ | 1,785.1M | | | | | | 95.0% | | | | | $ | 1,695.8M | | | | | EBIT | | | | | | | $ | 983.5M | | | | | | 95.0% | | | | | $ | 934.3M | | | | | EBIT Margin | | | | | | | | 16.9% | | | | N/A | | | | | 16.1% | | | | | CFFO Margin | | | | | | | | 27.1% | | | | | | 95.0% | | | | | | 25.7% | | |
Under the terms of the MICP, the Compensation Committee, in its complete and sole discretion, may adjust the targeted performance goals if an acquisition, significant new contract or extraordinary event results in a significant impact to the goals. For these purposes, the Compensation Committee determines operating income, or EBIT, primarily by adjusting for any gains or losses on disposal of assets, and determines EBITDA by adding depreciation, amortization and closure/post-closure accretion to operating income, both generally consistent with the Company’s approach to reporting non-GAAP measures in its earnings releases and filings with the SEC and applicable securities commissions or similar regulatory authorities in Canada. The Compensation Committee chose these measures of performance because they are widely used by investors as valuation measures in the solid waste industry and because the targeted goals encourage improving free cash flow and returns on invested capital. The Company’s cumulative performance relative to target is calculated as a weighted average and treated as a multiplier. The multiplier is applied to the target payout so that if the Company achieved 100% of its targets, the participants would receive 100% of their annual incentives. Participants may earn from 0% up to a maximum of 200% of their targeted annual incentives, based on their position, in accordance with the following sliding scale, which illustrates the interpolation of payouts within the ranges: | | % Target
Achievement | | | Target %
Multiplier | | | | 105% or Higher | | | | | 200% | | | | | 104% | | | | | 180% | | | | | 103% | | | | | 160% | | | | | 102% | | | | | 140% | | | | | 101% | | | | | 120% | | | | | 100% | | | | | 100% | | | | | 99% | | | | | 80% | | | | | 98% | | | | | 60% | | | | | 97% | | | | | 40% | | | | | 96% | | | | | 20% | | | | | 95% | | | | | 0% | | |
Payments under this program are contingent on continued employment at the time of payout, subject to the terms of any applicable employment agreements. 2022Notice of Annual Meeting & Proxy Statement39
Compensation Discussion & Analysis
2021 Adjusted Target Goals and Results In February 2022, the Compensation Committee adjusted the targets and results for 2021 primarily to reflect the impact of certain acquisitions and divestitures, impairments and other items, and proceeds from the disposal of assets. Adjustments are generally consistent with the Company’s approach to reporting non-GAAP measures in its earnings releases and filings with the SEC and applicable securities commissions or similar regulatory authorities in Canada. Adjusted targeted performance goals and results, and the corresponding target achievement percentages for 2021, are shown below. | | | | | Adjusted
Target(1) | | | Adjusted
Results(1) | | | Actual
Results as %
of Target | | | Weighting | | | Target
Achievement | | | | EBITDA | | | $1,719.0M | | | $1,905.2M | | | 110.8% | | | 20% | | | 22.2% | | | | EBIT | | | $937.2M | | | $1,077.7M | | | 115.0% | | | 20% | | | 23.0% | | | | EBIT Margin | | | 15.9% | | | 17.6% | | | 111.0% | | | 30% | | | 33.3% | | | | CFFO Margin | | | 25.6% | | | 28.5% | | | 111.3% | | | 30% | | | 33.4% | | | | OVERALL ACHIEVEMENT | | | | | | | | | | | | | | | 111.9% | |
(1)
The Compensation Committee adjusted the targets and results for 2021 to reflect the impact of certain acquisitions and divestitures, impairments and other items and proceeds from disposal of assets. Results were further adjusted for the foreign exchange benefit. Annual incentives earned for each participant were calculated pursuant to the interpolated sliding scale shown above. Based on the calculations, the Company achieved a weighted average of 111.9% of our NEOs’ targeted performance goals in 2021, resulting in the maximum payouts of 200% of eligible targets. The results reflect the Company’s outperformance during 2021 in spite of the continuing impacts from the COVID-19 pandemic, labor constraints and the onset of inflationary pressures during the year. The implementation of additional solid waste price increases to address inflationary pressures, along with higher commodity-driven revenues, drove results above target. Annual incentives earned and paid as a percentage of each participant’s eligible base salary, as well as incentives paid as a percentage of incentives earned, are shown below. | | Name | | | Earned Incentive %
of Eligible Base
Salary(1) | | | Paid Incentive %
of Eligible Base
Salary(1) | | | Incentive Paid as
% Earned | | | | Worthing F. Jackman(2) | | | 300% | | | 260% | | | 87% | | | | Mary Anne Whitney | | | 180% | | | 180% | | | 100% | | | | Darrell W. Chambliss | | | 180% | | | 180% | | | 100% | | | | Patrick J. Shea | | | 180% | | | 180% | | | 100% | | | | James M. Little | | | 180% | | | 180% | | | 100% | |
(1)
Calculated based on the NEOs’ base salary in effect on February 1, 2022. (2)
Mr. Jackman requested to forgo $400,000 in earned incentive compensation and to direct such amount toward the Company’s Employee Relief Fund to support employees experiencing financial hardship. Further disclosure regarding the actual annual incentive amounts earned by the NEOs for 2021 under the MICP is located in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table. In lieu of paying an annual incentive in cash, the Compensation Committee, in its complete and sole discretion, may choose to pay the annual incentive in RSUs issued under the 2016 Plan or any succeeding plan we adopt. All 2021 annual incentives paid pursuant to the MICP were paid in cash. In February 2022, the Compensation Committee certified the 2021 results for the MICP and approved our 2022 MICP under the 2016 Plan. Long-Term Incentives: Equity-Based Compensation We believe that equity ownership in the Company ties executive compensation to the performance of Common Shares and creates an incentive for sustained growth, superior shareholder returns and employee retention. This investment provided to NEOs and other corporate officers coupled with multi-year vesting periods or
Compensation Discussion & Analysis
performance-based metrics serves to enhance retention and corporate culture, both of which are instrumental to the future success of the Company and the long-term interests of our shareholders. Each year, the Compensation Committee, after consultation with the CEO, assesses our performance and the performance of each of the NEOs and other corporate officers during the most recently completed fiscal year. Based on the Compensation Committee’s subjective review of the prior year’s performance and with a focus on maintaining a competitive market level of compensation, each NEO and other corporate officer receives a grant of RSUs and PSUs under the 2016 Plan. The Compensation Committee believes that the use of RSU awards reduces the overall compensation cost to us compared to the cost of granting share options at levels intended to convey similar value, and offers our NEOs a competitive and more stable equity-based compensation. RSU awards provide our NEOs and other corporate officers with the opportunity to share in the success of the Company. RSU awards vest in equal increments annually over four years and three years for U.S. and Canadian employees, respectively. Upon vesting of the RSU awards, the participant receives Common Shares equal to the number of DSUsRSUs that vested (or, in our discretion, the cash equivalent), less any shares (or cash, if applicable) withheld and used to pay withholding taxes and other source deduction amounts. There are no dividend equivalents paid on outstanding RSUs during the vesting period, and RSUs do not carry voting rights or any other rights of a shareholder. In 2014, the Compensation Committee introduced performance-based restricted share units, or PSUs, which are awards subject to three-year performance hurdles to further enhance the link between executive compensation and our performance. Performance goals for the three-year performance period are recommended by management based on our historical performance, current projections and trends, and are established during the first quarter of the performance period. The Compensation Committee reviews management’s recommendations (including a discussion of associated risks), determines appropriate revisions, and once satisfied with the degree of difficulty associated with goal achievement, approves the goals for each performance period. The Compensation Committee seeks to establish goals for which the likelihood of missing the target goal is at least as high as the likelihood of achieving the target goal based on reasonable assumptions and projections at the time of grant. For the annual award in February 2021, the number of PSUs at target as a percentage of the total long-term incentives awarded to each participant equaled 50%. For the 2021-2023 performance period, each participant can earn up to 200% of the target number of PSUs based on achievement of three metrics: a return on invested capital (“ROIC”) improvement goal, a free cash flow per share (“FCFPS”) growth goal, each weighted 42.5%, and an ESG Target goal, weighted 15.0%. The Compensation Committee selected the ROIC and FCFPS metrics because it believes they are critical drivers of sustained value creation over the longer term and align with the interests of shareholders. The addition of ESG and sustainability targets was made in 2021 following the adoption of long-term, aspirational targets for achievement of sustainability-related goals in 2020. The table below shows the required achievement of ROIC improvement and FCFPS growth performance measures and the corresponding potential payouts under our PSUs granted in 2021 using annual measurements to calculate three-year achievement against thresholds (as interpolated and pro-rated) for each of the three years. | | | | | 3-Year ROIC
Improvement | | | Annual Free Cash
Flow/Share
Growth | | | | Threshold (0% pay-out) | | | 25 basis points | | | 2.0% | | | | Minimum (50% pay-out) | | | 75 basis points | | | 4.0% | | | | Target (100% pay-out) | | | 125 basis points | | | 6.0% | | | | Maximum (200% pay-out) | | | 175 basis points | | | 10.0% | |
In addition, the ESG component provides for progress towards achieving each of the six long-term ESG and sustainability targets over the three-year period, with payment per target as follows: 3% for annual improvement in any one year, 4% for annual improvement in two of the three years, and 5% for improvement over the three-year period. 2022Notice of Annual Meeting & Proxy Statement41
Compensation Discussion & Analysis
Finally, a relative performance metric affects the number of PSU awards earned. Performance with respect to the TSR modifier is calculated usingbased on the same rateCompany’s performance relative to the S&P 500 Index for each of the twelve quarters during the 3-year performance period. The Compensation Committee believes this calculation of TSR prevents the overweighting of anomalous events at the beginning or end of a multi-year measurement period. Moreover, any incremental payout associated with this modifier begins to accrue only if the Company’s average relative TSR is above the 50th percentile of the peer group, as fordescribed below. Each participant can earn 112.5% of the achieved amount if the Company’s relative TSR measured against the S&P 500 companies is between the 50th and 75th percentile and 125% of the achieved amount if the Company’s relative TSR measured against the S&P 500 companies is above the 75th percentile. At the end of a three-year performance period, the Compensation Committee will certify the performance results and percentage payout, as well as the resulting final number of PSUs earned by each participant, if any. There are no dividends paid on outstanding PSUs during the vesting period, but dividend equivalents on the number of PSUs that ultimately vest will accumulate, and a dividend equivalent payment will be payable to each participant on the settlement date without interest. Upon vesting of the PSUs, in addition to receiving the number of Common Shares determined in accordance with the payout calculation, the participant will receive a cash payment equal in value to the total dividends that would have been paid on the number of Common Shares that vest. PSUs do not carry voting rights or any other rights of a shareholder. While staying competitive with the market is an overall guideline, individual target opportunities may vary based on the Compensation Committee’s consideration of other factors, as discussed above. The equity-based compensation targets in 2021 were 325% of eligible base salary for Mr. Jackman and 187.5% for the other NEOs. RSUs constituted 50% of the total equity grant awarded, and PSUs constituted the remaining 50%. See “Grant of Plan Based Awards in Fiscal Year 2021” table for additional detail regarding equity awards granted to each of the NEOs in 2021. For 2022, the total equity-based compensation targets were set as follows: for Mr. Jackman, 350% of his base salary; and 200% for the other NEOs. RSUs constituted 50% of the total equity grant awarded, and PSUs constituted the remaining 50%. Pay-out for the 3-Year Performance Period Ended December 31, 2021 In February 2022, the Compensation Committee certified the results of the 2019-2021 PSUs granted under our 2016 Plan (the “2019 PSUs”). The 2019 PSUs were subject to a 3-year performance period that ended December 31, 2021, and the number of Common Shares that could have become earned and vested ranged from 0% to a maximum of 200% of the number of performance units granted in 2019, subject to a potential TSR modifier. Performance measures for the 2019 PSUs included: (i) the compound annual growth rate of adjusted free cash flow per share, and (ii) absolute improvement in ROIC. Each goal was judged on a 0% to 200% performance scale and was equally weighted when calculating overall Company performance for purposes of determining the number of earned Common Shares. The adjusted free cash flow measure set a target compound annual growth rate for the Company to achieve over the 3-year performance period. Adjusted free cash flow per share was calculated for each year using adjusted free cash flow divided by the number of shares outstanding, with the calculation of adjusted free cash flow consistent with the Company’s approach to reporting non-GAAP measures in its earnings releases and filings with the SEC and applicable securities commissions or similar regulatory authorities in Canada. The ROIC improvement measure set a target increase in ROIC for the Company to achieve over the 3-year performance period. ROIC for each year was then calculated using after tax net operating profit before amortization of intangibles, divided by average invested capital (generally determined by taking the average of invested capital at the end of the year and invested capital at the end of the prior year). The Compensation Committee determined that compounded adjusted free cash flow per share growth during the 3-year performance period ended December 31, 2021 was approximately 5.0%, as compared to a minimum threshold of 6.0%, resulting in an achievement percentage of 0%. The Compensation Committee also determined that the absolute increase in ROIC over the 3-year performance period ended December 31, 2021 was 96 basis points, as compared to a minimum threshold of 100 basis points, resulting in an achievement percentage of 0%. As such, the resulting combined weighted average achievement was 0% of the target grant amount and therefore no TSR modifier was applied although it was calculated at 8.3% based on the Company’s performance relative to the S&P 500 during the twelve quarters of the measurement period. Please refer to the CD&A Appendix at the
Compensation Discussion & Analysis
end of this CD&A on page 46 for details regarding the calculation of our results for 2018 and 2021 for the adjusted free cash flow per share measure and the ROIC improvement measure. The target amount of 2019 PSUs for each participant and number of Common Shares earned for the 2019-2021 performance period are shown below. | | Name | | | Target
Amount of
PSUs | | | Common
Shares
Earned | | | Common Shares
Earned as
% Target | | | | Worthing F. Jackman | | | 9,415 | | | 0 | | | 0% | | | | Mary Anne Whitney | | | 3,512 | | | 0 | | | 0% | | | | Darrell W. Chambliss | | | 5,439 | | | 0 | | | 0% | | | | Patrick J. Shea | | | 3,708 | | | 0 | | | 0% | | | | James M. Little | | | 3,659 | | | 0 | | | 0% | |
The measurement period for the 2019 PSUs included the onset of the COVID-19 pandemic in 2020 and the related economic disruptions from lockdowns and other restrictions impacting financial results. The Compensation Committee did not make adjustments to results for the impacts to revenue, adjusted EBITDA, or adjusted free cash flow or the resulting impacts over the three-year measurement period. SHARE OWNERSHIP GUIDELINES To further align management incentives and shareholder interests and discourage inappropriate or excessive risk-taking, our Board of Directors has established share ownership guidelines for our NEOs and other corporate officers. The current minimum ownership thresholds are as follows: Once a corporate officer has acquired a number of Common Shares that satisfies the ownership multiple then applicable to him or her, such number of Common Shares then becomes his or her minimum ownership requirement (even if the officer’s salary increases or the fair market value of such Common Shares subsequently changes) until he or she is promoted to a higher level. Each corporate officer is expected to attain the applicable share ownership threshold under the guidelines within five years following the later of (i) the first annual assessment with respect to such individual or (ii) the first annual assessment at which a higher share ownership multiple becomes applicable to such individual (due to a promotion or otherwise). The five-year phase-in period is intended to permit gradual accumulation of the incremental ownership associated with a new or higher multiple. For purposes of the calculation, Common Shares deemed “beneficially owned” by the corporate officer within the meaning of the rules of the SEC, as well as RSUs subject to time-based vesting held by a corporate officer and vested or time-based unvested RSUs or resulting Common Shares deposited into a deferred compensation plan or arrangement, are included in the calculation of the amount of such individual’s ownership. 2022Notice of Annual Meeting & Proxy Statement43
Compensation Discussion & Analysis
As of the date of this Proxy Statement, all of our corporate officers exceed their current share ownership requirement. TIMING OF EQUITY AWARDS The Compensation Committee generally makes annual grants of equity-based compensation to our executive and non-executive officers and other employees in February following the public release of year-end financial results and outlook for the upcoming year. This timing is optimal from the Compensation Committee’s standpoint for two reasons: first, the Compensation Committee has the financial results from the previous year; and second, management may notify employees of the annual grant award at or around the same time they typically notify employees of their cash annual incentive with respect to the previous year, which we typically pay in February. Other Benefits and Compensation Information We provide certain limited benefits to our employees, including the NEOs, to fulfill business purposes. In general, these benefits make up a very small percentage of total compensation for the NEOs. 401(K) PLAN The NEOs are entitled to participate in a Company-sponsored 401(k) profit sharing plan on the same terms as all our U.S. employees. We make matching contributions of 100% of every dollar of a participating employee’s pre-tax and Roth contributions until the employee’s contributions equal five percent of the employee’s eligible compensation, subject to certain limitations imposed by the Internal Revenue Code, or the IRC. Employees are eligible to participate in the 401(k) plan beginning on the first day of the month following the completion of sixty days of employment. Matching contributions are subject to certain deferral limitations imposed by the IRC on 401(k) plans and, when made, are 100% vested. DEFERRED COMPENSATION PLAN We provide NEOs and certain other highly compensated employees the opportunity to defer receiving income until a scheduled in-service date or after they terminate their employment. This offers tax advantages by deferring taxation on the deferred compensation until the distribution date. We make a matching contribution of 100% of every dollar of a participating employee’s pre-tax eligible contributions until the employee’s contributions equal five percent of the employee’s eligible compensation, less the amount of any match we make on behalf of the employee under the Company-sponsored 401(k) plan. Matching contributions are subject to certain deferral limitations imposed by the IRC on 401(k) plans and, when made, are 100% vested. The deferred compensation plan is described under the heading “Nonqualified Deferred Compensation in Fiscal Year 2021.” EMPLOYEE SHARE PURCHASE PLAN On February 11, 2020, the Board of Directors adopted the 2020 Employee Share Purchase Plan (the “ESPP”), which was approved by the Company’s shareholders on May 15, 2020. Under the ESPP, qualified employees (including NEOs) may elect to have payroll deductions withheld from their eligible compensation on each payroll date in amounts equal to or greater than one percent (1%) but not in excess of ten percent (10%) of eligible compensation in order to purchase Common Shares under certain terms and subject to certain restrictions set forth in the ESPP. The exercise price is equal to 95% of the closing price of the Company’s common shares on the last day of the relevant offering period, subject to certain restrictions. The maximum number of Common Shares that may be issued under the ESPP is 1,000,000, subject to adjustment in accordance with the terms of the ESPP. Common Shares issued or delivered under the ESPP may be Common Shares that are authorized and unissued or Common Shares that were reacquired by the Company, including Common Shares purchased in the open market on behalf of the applicable participant. If Common Shares are acquired on the open market, the Company is responsible for funding the difference between the acquisition cost of such Common Shares and the option price payable from the participant’s contributions. OTHER BENEFITS We also offer a number of benefits to the NEOs pursuant to benefit programs that provide for broad-based employee participation. In addition to the 401(k) plan and the ESPP described above, the benefits include
Compensation Discussion & Analysis
medical, prescription drugs, dental and vision insurance, short-term and long-term disability insurance, life and accidental death and dismemberment insurance, health and dependent flexible spending accounts, health savings accounts, and employee assistance benefits. These generally available benefits do not specifically factor into decisions regarding an individual executive’s total compensation or equity-based compensation package. These benefits are designed to help us attract and retain employees as we compete for talented individuals in the marketplace, where such benefits are commonly offered. We also offer limited additional benefits to select employees, such as payment for annual physical examinations, reimbursement of certain club dues and financial planning services, and personal use at times of a private aircraft if approved by the CEO. ANTI-HEDGING/PLEDGING POLICY We have adopted a policy prohibiting executive officers and directors from engaging in transactions designed to hedge against the economic risks associated with an investment in Common Shares or pledging Common Shares. These individuals may not engage in the purchase or sale of put and call options, short sales and other hedging transactions designed to minimize the risk of owning Common Shares. In addition, these individuals may not pledge Common Shares as collateral unless pre-authorized to do so in certain limited situations. CLAWBACK PROVISIONS Our Board of Directors has adopted a Compensation Recoupment Policy (the “Clawback Policy”) to maintain and enhance a culture that emphasizes integrity and accountability and that reinforces the Company’s pay-for-performance compensation philosophy. As more fully described in the Clawback Policy, which was filed as an exhibit to the Form 10-K we filed with the SEC and the securities commissions and similar regulatory authorities in Canada on February 17, 2022, the policy provides that if an accounting restatement occurs, the Board of Directors shall seek to require the forfeiture or repayment of incentive compensation paid to an NEO or other corporate officer during the three completed fiscal years preceding the date of the restatement that is in excess of the amount that would have been awarded to, vested and/or paid to the NEO or other corporate officer under the restatement if (1) the NEO or other corporate officer engaged in fraud or intentional misconduct that materially contributed to the need for the restatement, or (2) a clawback is otherwise required by the applicable rules and regulations of the SEC or any national securities exchange on which the Company’s shares are listed. Although we may need to revise our Clawback Policy depending on the final recoupment rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), we believe this policy is a good governance practice that is beneficial for the Company even ahead of the final rules. We also maintain numerous risk mitigating provisions in our compensation arrangements for the NEOs, which are described under the heading “Compensation Risk Assessment.” Examples include the Compensation Committee’s ability to exercise negative discretion to reduce annual incentive awards to zero, PSU grants which require achievement of multiple pre-determined goals over a three-year period before vesting, anti-hedging/anti-pledging policies, and share ownership requirements. TAX DEDUCTIBILITY CONSIDERATIONS In establishing total compensation for our executive officers, the Compensation Committee considers the accounting treatment and tax treatment of its compensation decisions, including Section 162(m) of the IRC. Section 162(m) generally disallows an income tax deduction to publicly traded corporations for compensation in excess of $1,000,000 paid for any fiscal year to the Company’s “covered employees,” defined in Section 162(m) as the CEO, the Chief Financial Officer and the three most highly compensated executive officers, other than the CEO and Chief Financial Officer. The Compensation Committee believes that the potential deductibility of the compensation payable under its incentive compensation plans and arrangements should be only one of a number of relevant factors taken into consideration in establishing those plans and arrangements for our executive officers and not the sole governing factor. For that reason, the Compensation Committee intends to structure its incentive compensation plans and arrangements in a manner which, acknowledging that a portion of those compensation payments may not be deductible under Section 162(m), assures appropriate levels of total compensation for our ex ecutive officers based on and aligned with the Company’s performance. SEVERANCE AND CHANGE IN CONTROL ARRANGEMENTS The Compensation Committee believes that the Company’s current and historic successes are due in large part tothe leadership, skills and performance of the NEOs, and that it is critical to maintain the stability of the 2022Notice of Annual Meeting & Proxy Statement45
Compensation Discussion & Analysis
Companyby providing severance and change in control benefits inorder to encourage NEO retention through a change in control.On February 13, 2012, a subsidiary of the Company implemented a Separation Benefits Plan, which has been mostrecently restated on July 24, 2018, as discussed below, under which eligible officers of the Company, including ourNEOs, may receive certain severance and change in control benefits (the “Separation Benefits Plan”). CD&A Appendix — Calculation of Actual Results for 2019 PSU Performance Measures As discussed above, the 2019 PSUs were subject to a 3-year performance period that ended December 31, 2021, and the performance measures for the 2019 PSUs included: (i) the compound annual growth rate of adjusted free cash flow per share, and (ii) absolute improvement in ROIC. The measurement period for the 2019 PSUs included the onset of the COVID-19 pandemic in 2020 and the related economic disruptions from lockdowns and other restrictions impacting financial results. The Compensation Committee did not make adjustments to results for the impacts to revenue, adjusted EBITDA, or adjusted free cash flow during 2020 or the resulting impacts over the three-year measurement period. The calculation of our results for 2018 and 2021 for the adjusted free cash flow measure and the ROIC improvement measure are listed below. Adjusted Free Cash Flow Per Share Measure (In Millions, Except as Noted) | | | | | 2018 | | | 2021 | | | | Adjusted Free Cash Flow* | | | | $ | 879.9 | | | | | $ | 1,009.5 | | | | | Diluted shares outstanding as of year-end | | | | | 264.4 | | | | | | 261.7 | | | | | Adjusted free cash flow per share(1) | | | | $ | 3.33 | | | | | $ | 3.86 | | |
Return on Invested Capital Measure (In Millions, Except as Noted) | | | | | 2018 | | | 2021 | | | | Adjusted EBITDA* | | | | $ | 1,566.4 | | | | | $ | 1,916.3 | | | | | Less: depreciation | | | | | (572.7) | | | | | | (673.7) | | | | | Less: taxes(2) | | | | | (224.6) | | | | | | (247.3) | | | | | Tax-effected EBITA | | | | | 769.1 | | | | | | 995.3 | | | | | Average total capital(3) | | | | $ | 9,796.7 | | | | | $ | 11,291.0 | | | | | Return on Invested capital | | | | | 7.85% | | | | | | 8.82% | | |
*
Non-GAAP measures, as reconciled in our Annual Report on Form 10-K for the fiscal years ended December 31, 2018, and 2021. (1)
Adjusted free cash flow per share measure defined as compound annual growth rate of adjusted free cash flow divided by total diluted shares outstanding during the three-year period ended December 31, 2021, as adjusted; and, ROIC measure defined as absolute increase in ROIC during the three-year period ended December 31, 2021, as adjusted. (2)
Reflects effective tax rates for the full years 2018 and 2021, respectively. (3)
Average total capital defined during each period as the average outstanding debt less cash plus equity, adjusted to reflect the timing of incremental debt associated with acquisitions late in the year. Outstanding debt includes long-term debt and current year debt, and cash includes restricted cash. Compensation Committee Report The Compensation Committee of the Board of Directors has reviewed and discussed with management the “Compensation Discussion and Analysis” required by Item 402(b) of Regulation S-K. Based on the review and discussions referred to above, the Compensation Committee recommended to the Board of Directors that the “Compensation Discussion and Analysis” be incorporated into both our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, and this Proxy Statement. This report is submitted on behalf of the Compensation Committee. William J. Razzouk, Chairman
Edward E. “Ned” Guillet
Susan “Sue” Lee
Compensation Discussion & Analysis
Compensation Risk Assessment We believe our compensation policies and practices do not present any risk that is reasonably likely to have a material adverse effect on the Company. We believe our approach to setting performance targets, evaluating performance, and establishing pay-outs does not promote excessive risk-taking. We believe the components of our pay mix — base salary, annual cash incentive bonuses, and long-term equity grants — appropriately balance near-term performance improvement with sustainable long-term value creation. We considered the following elements of our compensation policies and practices when evaluating whether such policies and practices encourage our employees to take unreasonable risks: •
Annual performance targets are established by each operating location and region and on a company-wide basis to encourage decision-making that is in the best long-term interests of both the Company and our shareholders; •
We adjust performance targets to exclude the benefit or detriment of extraordinary events to ensure our employees are compensated on results within their control or influence; •
We adjust performance targets to include certain acquisitions and new contracts not reflected in the originally approved operating budget in order to achieve targeted returns on deployed capital; •
The use of four performance metrics in our annual cash incentive plan mitigates the incentive to overperform with respect to any particular financial metric at the expense of other financial metrics; •
We set annual performance goals to avoid targets that, if not achieved, result in a large percentage loss of compensation; •
Pay-outs under our performance-based plans remain at the discretion of our Board of Directors and may be reduced even if targeted performance levels are achieved; •
Pay-outs under our performance-based plans can result in some compensation at levels below full target achievement, rather than an “all-or-nothing” approach; •
Our NEOs receive annual cash incentive bonus awards only if cash incentive bonus awards payable to other employees have been made; •
We have adopted a clawback policy which allows us to seek recovery of certain incentive cash and equity compensation if it is earned based on inaccurate financial statements; •
We use RSUs rather than share options for equity awards because RSUs retain value even in a depressed market; recipient employees are less likely to take unreasonable risks to get, or keep, share options “in-the-money;” •
Equity-based compensation with time-based vesting over a multi-year schedule accounts for a time horizon of risk and ensures that participating employee interests are aligned with the long-term interests of our shareholders; •
Share ownership guidelines require members of our Board of Directors, our NEOs, and other corporate officers to maintain certain ownership levels in Common Shares, which aligns a portion of their personal wealth to the long-term performance of the Company; •
We have adopted a policy that prohibits members of our Board of Directors, our NEOs, and other corporate officers from engaging in transactions designed to hedge against the economic risks associated with an investment in Common Shares or pledging Common Shares; and •
Our Compensation Committee periodically utilizes an independent compensation consultant that performs no other services for the Company. 2022Notice of Annual Meeting & Proxy Statement47
Executive Compensation Tables
Executive Compensation Tables Summary Compensation Table The following table summarizes the total compensation earned by each of our NEOs in 2021, 2020 and 2019. | | Name and Principal
Position | | | Year | | | Salary
($)(1) | | | Bonus
($) | | | Share
Based
Awards
($)(2) | | | Option
Based
Awards
($) | | | Non-Equity
Incentive Plan
Compensation
($) | | | Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($) | | | All Other
Compensation
($)(3) | | | Total
($) | | | | Worthing F. Jackman
President and Chief Executive Officer | | | | | 2021 | | | | | | 900,000 | | | | | | — | | | | | | 3,723,139 | | | | | | — | | | | | | 2,570,000 | | | | | | — | | | | | | 90,728 | | | | | | 7,283,867 | | | | | | | 2020 | | | | | | 888,462 | | | | | | — | | | | | | 2,953,395 | | | | | | — | | | | | | 1,125,000 | | | | | | — | | | | | | 72,464 | | | | | | 5,039,321 | | | | | | | 2019 | | | | | | 716,792 | | | | | | — | | | | | | 1,559,501 | | | | | | — | | | | | | 1,102,500 | | | | | | — | | | | | | 29,581 | | | | | | 3,408,374 | | | | | Mary Anne Whitney
Executive Vice President and Chief Financial Officer | | | | | 2021 | | | | | | 544,231 | | | | | | — | | | | | | 1,290,414 | | | | | | — | | | | | | 1,019,700 | | | | | | — | | | | | | 36,189 | | | | | | 2,890,534 | | | | | | | 2020 | | | | | | 493,077 | | | | | | — | | | | | | 872,004 | | | | | | — | | | | | | 468,000 | | | | | | — | | | | | | 46,427 | | | | | | 1,879,508 | | | | | | | 2019 | | | | | | 425,692 | | | | | | — | | | | | | 581,728 | | | | | | — | | | | | | 343,000 | | | | | | — | | | | | | 26,723 | | | | | | 1,377,143 | | | | | Darrell W. Chambliss
Executive Vice President and Chief Operating Officer | | | | | 2021 | | | | | | 553,500 | | | | | | — | | | | | | 1,397,400 | | | | | | — | | | | | | 1,029,600 | | | | | | — | | | | | | 34,886 | | | | | | 3,015,386 | | | | | | | 2020 | | | | | | 540,370 | | | | | | — | | | | | | 1,110,767 | | | | | | — | | | | | | 472,000 | | | | | | — | | | | | | 42,441 | | | | | | 2,165,578 | | | | | | | 2019 | | | | | | 514,356 | | | | | | — | | | | | | 900,916 | | | | | | — | | | | | | 451,000 | | | | | | — | | | | | | 26,238 | | | | | | 1,892,510 | | | | | Patrick J. Shea
Executive Vice President, General Counsel and Secretary | | | | | 2021 | | | | | | 457,923 | | | | | | — | | | | | | 1,132,331 | | | | | | — | | | | | | 853,200 | | | | | | — | | | | | | 42,800 | | | | | | 2,486,254 | | | | | | | 2020 | | | | | | 440,673 | | | | | | — | | | | | | 905,846 | | | | | | — | | | | | | 390,000 | | | | | | — | | | | | | 39,768 | | | | | | 1,776,287 | | | | | | | 2019 | | | | | | 419,475 | | | | | | — | | | | | | 614,193 | | | | | | — | | | | | | 368,000 | | | | | | — | | | | | | 30,889 | | | | | | 1,432,557 | | | | | James M. Little
Executive Vice
President – Engineering
and Disposal | | | | | 2021 | | | | | | 445,731 | | | | | | — | | | | | | 1,101,592 | | | | | | — | | | | | | 828,000 | | | | | | — | | | | | | 39,354 | | | | | | 2,414,677 | | | | | | | 2020 | | | | | | 434,774 | | | | | | — | | | | | | 892,766 | | | | | | — | | | | | | 380,000 | | | | | | — | | | | | | 38,872 | | | | | | 1,746,412 | | | | | | | 2019 | | | | | | 414,481 | | | | | | — | | | | | | 606,077 | | | | | | — | | | | | | 363,000 | | | | | | — | | | | | | 27,154 | | | | | | 1,410,712 | | |
(1)
Amounts shown reflect salary earned by the NEOs for each year indicated and reflect increases that Ms. Whitney and Messrs. Chambliss, Shea and Little received on February 1, 2021. Mr. Jackman did not receive a salary increase for 2021. The increase that Ms. Whitney received is part of a multi-year approach to increase targeted direct compensation towards or within a +/- 10% range of the median market Comparator Group. (2)
Share based awards consist of (i) RSUs granted under the 2016 Plan, and (ii) PSUs granted under the 2016 Plan. Amounts shown do not reflect compensation actually received by the NEO. Instead, the amounts shown are the grant date fair value of the awards computed in accordance with GAAP, excluding estimates of forfeitures related to service-based vesting conditions. A discussion of the fair value of share awards is set forth under Note 1 of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 17, 2022. The table below sets forth the details of the components that make up the fiscal year 2021 share awards for our NEOs. The annual RSU awards vest in four substantially equal annual installments beginning on the first anniversary of the grant date. | | | | | Components of Annual Share Awards | | | | Name | | | Value of Annual Restricted
Share Units
($) | | | Value of Performance-Based
Restricted Share Units
($) | | | | Worthing F. Jackman | | | 1,861,569 | | | 1,861,569 | | | | Mary Anne Whitney | | | 645,207 | | | 645,207 | | | | Darrell W. Chambliss | | | 698,700 | | | 698,700 | | | | Patrick J. Shea | | | 566,165 | | | 566,165 | | | | James M. Little | | | 550,796 | | | 550,796 | |
(3)
We make available for business use to our NEOs and other employees a private aircraft. Our general policy is not to permit employees, including the NEOs, to use the aircraft for purely personal use. Occasionally, employees or their relatives or spouses, including relatives or spouses of the NEOs, may derive personal benefit from travel on our aircraft incidental to a business function, such as when an NEO’s spouse accompanies the officer to the location of an event the officer is attending for business purposes. For purposes of our Summary Compensation Table, we value the compensatory benefit to the officer at the incremental cost to us of conferring the benefit, which consists of additional catering and fuel expenses. In the example given, the incremental cost would be nominal because the aircraft would have been used to travel to the event, and the basic costs of the trip would have been incurred, whether or not the NEO’s spouse
Executive Compensation Tables
accompanied the officer on the trip. However, beginning in 2020, we made the aircraft available for limited, purely personal use as a result of commercial air travel disruptions and to reduce possible health concerns related to traveling during the COVID-19 pandemic. On the rare occasions when we permit an employee to use the aircraft for purely personal use, we value the compensation benefit to such employee (including NEOs) at the incremental cost to us of conferring the benefit, which consists of the average weighted fuel expenses, catering expenses, trip-related crew expenses, landing fees and trip-related hangar/parking costs. Since our aircraft is used primarily for business travel, the valuation excludes the fixed costs that do not change based on usage, such as pilots’ compensation and the cost of maintenance. Our valuation of personal use of aircraft as set forth in this Proxy Statement is calculated in accordance with SEC guidance, which may not be the same as valuation under applicable tax regulations. In 2021, All Other Compensation paid to our NEOs consisted of the following amounts: | | Name | | | Matching
Contributions
to 401(k)
($) | | | Company
Contributions
Under
Nonqualified
Deferred
Compensation
Plan
($) | | | Life
Insurance
Premiums
Paid by
Company(a)
($) | | | Professional
Association
Dues
($) | | | Tax
Preparation
Expenses
($) | | | Club
Dues
($) | | | Personal Use
of Corporate
Aircraft
Incidental
to Business
Function
($) | | | Purely
Personal
Use of
Corporate
Aircraft
($) | | | Total All
“Other”
Compensation
($) | | | | Worthing F. Jackman | | | | | — | | | | | | 14,500 | | | | | | 4,292 | | | | | | 487 | | | | | | 3,763 | | | | | | 16,238 | | | | | | 329 | | | | | | 51,119 | | | | | | 90,728 | | | | | Mary Anne Whitney | | | | | 14,500 | | | | | | — | | | | | | 3,705 | | | | | | — | | | | | | 4,250 | | | | | | 13,734 | | | | | | — | | | | | | — | | | | | | 36,189 | | | | | Darrell W. Chambliss | | | | | 14,500 | | | | | | — | | | | | | 6,679 | | | | | | 1,250 | | | | | | — | | | | | | 12,292 | | | | | | 165 | | | | | | — | | | | | | 34,899 | | | | | Patrick J. Shea | | | | | 14,500 | | | | | | — | | | | | | 2,535 | | | | | | 1,546 | | | | | | 3,950 | | | | | | 14,292 | | | | | | 170 | | | | | | 5,807 | | | | | | 42,800 | | | | | James M. Little | | | | | 14,500 | | | | | | — | | | | | | 4,261 | | | | | | — | | | | | | — | | | | | | 16,238 | | | | | | — | | | | | | 4,355 | | | | | | 39,354 | | |
(a)
Amounts shown are paid by the Company in connection with life insurance policies made available to all participants in our Nonqualified Deferred Compensation Plan, including the NEOs. As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of Regulation S-K, we are providing the following information about the ratio of the annual total compensation, calculated in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K (the “Annual Total Compensation”) of our median employee and the Annual Total Compensation of our CEO, Mr. Jackman. For 2021, our last completed fiscal year, Mr. Jackman’s 2021 Annual Total Compensation was $7,283,867, as reflected in the Summary Compensation Table included in this Proxy Statement. Our median employee was determined in accordance with the methodology described below to be an accounting clerk whose annual total compensation for 2021 was $59,537. The resulting ratio of our CEO’s pay to the pay of our median employee is approximately 122.3 to 1. We have elected to disclose a supplemental ratio that includes the value of health and dental care benefits paid by the Company. Because these benefits are provided on a broad, non-discretionary basis, the value is not required to be reported in the Summary Compensation Table. However, if we were to add the value of these benefits, the total compensation of our CEO would increase by $17,466 and the total compensation of our median employee would increase by $11,627, and the resulting ratio of our CEO’s annual total compensation to the annual total compensation of our median employee would be approximately 97.8 to 1. As of December 31, 2021, our employee population consisted of 19,998 active employees, 10,322 of whom are commercial truck drivers and 1,663 of whom are mechanics. There were 17,146 employees located in the United States and 2,852 employees located in Canada. We applied a Canadian dollar to U.S. dollar exchange rate to the compensation paid in Canadian dollars based on the average exchange rate in 2021. We determined our median employee by examining 2021 W-2 box 5 amounts and foreign equivalent taxable income amounts for all of our full time and part time employees, excluding our CEO, who were employed by us on December 31, 2021. We did not include those employees on leave as of December 31, 2021. In addition, we did not include temporary agency employees whose compensation is determined by the agency and who are not considered our employees for purposes of the pay ratio calculation. The pay ratios reported above are reasonable estimates calculated in a manner consistent with SEC rules, based on our internal records and the methodology described above. The SEC rules for identifying the median compensated employee allow companies to adopt a variety of methodologies, to apply certain exclusions and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Accordingly, the pay ratio reported by other companies may not be comparable to the pay ratios 2022Notice of Annual Meeting & Proxy Statement49
Executive Compensation Tables
reported above, as other companies have different employee populations and compensation practices and may use different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios. Grants of Plan-Based Awards in Fiscal Year 2021 The following table summarizes the number of awards under the MICP and equity awards granted to our NEOs by the Company in 2021. | | | | | | | | | | | | | | | | | Estimated Potential Payouts Under
Non-Equity Incentive Plan Awards(2) | | | Estimated Future Payouts Under
Equity Incentive Plan Awards | | | All Other Share
Awards: Number
of Common
Shares or Units
(#)(3) | | | Grant Date
Fair Value
of Share
Awards
($)(4) | | | | Name | | | Award
Type(1) | | | Grant
Date | | | Threshold
($) | | | Target
($) | | | Maximum
($) | | | Threshold
(#) | | | Target
(#) | | | Maximum
(#) | | | | Worthing F. Jackman | | | | | RSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 18,653 | | | | | | 1,861,569 | | | | | | | PSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | 0 | | | | | | 18,653 | | | | | | 46,632 | | | | | | — | | | | | | 1,861,569(5) | | | | | | | MICP | | | | | | — | | | | | | 297,000 | | | | | | 1,485,000 | | | | | | 2,970,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | Mary Anne Whitney | | | | | RSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6,465 | | | | | | 645,207 | | | | | | | PSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | 0 | | | | | | 6,465 | | | | | | 16,162 | | | | | | — | | | | | | 645,207(5) | | | | | | | MICP | | | | | | — | | | | | | 101,970 | | | | | | 509,850 | | | | | | 1,019,700 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | Darrell W. Chambliss | | | | | RSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 7,001 | | | | | | 698,700 | | | | | | | PSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | 0 | | | | | | 7,001 | | | | | | 17,502 | | | | | | — | | | | | | 698,700(5) | | | | | | | MICP | | | | | | — | | | | | | 102,960 | | | | | | 514,800 | | | | | | 1,029,600 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | Patrick J. Shea | | | | | RSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5,673 | | | | | | 566,165 | | | | | | | PSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | 0 | | | | | | 5,673 | | | | | | 14,182 | | | | | | — | | | | | | 566,165(5) | | | | | | | MICP | | | | | | — | | | | | | 85,320 | | | | | | 426,600 | | | | | | 853,200 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | James M. Little | | | | | RSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5,519 | | | | | | 550,796 | | | | | | | PSU | | | | | | 2/19/21 | | | | | | — | | | | | | — | | | | | | — | | | | | | 0 | | | | | | 5,519 | | | | | | 13,797 | | | | | | — | | | | | | 550,796(5) | | | | | | | MICP | | | | | | — | | | | | | 82,800 | | | | | | 414,000 | | | | | | 828,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
(1)
“RSU” refers to restricted share units granted under the 2016 Plan. “PSU” refers to performance-based restricted share units granted under the 2016 Plan. “MICP” refers to cash awards made pursuant to our Management Incentive Compensation Program, which is administered pursuant to the 2016 Plan. (2)
In the case of the MICP, the target incentive amounts shown in this column reflect our annual incentive bonus plan awards under the MICP and represent the target awards pre-established as a percentage of salary. The maximum is the greatest payout which can be made if the pre-established maximum performance level is met or exceeded. Actual annual incentive bonus amounts earned by the NEOs for 2021 under the MICP are reflected in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table. (3)
Share awards consist of RSUs granted under the 2016 Plan on February 19, 2021. The RSUs vest in equal, annual installments over the four-year period following the date of grant, beginning on the first anniversary of the date of grant. See “Compensation Discussion and Analysis — Equity-Based Compensation” for more information regarding RSU awards. (4)
The value of a share award is based on the fair value as of the grant date of such award computed in accordance with GAAP, excluding estimates of forfeitures related to service-based vesting conditions. A discussion of the fair value of share awards is set forth under Note 1 of the “Notes to Consolidated Financial Statements” included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 17, 2022. (5)
Represents the range of possible payouts of Common Shares upon the vesting of PSUs granted in fiscal year 2021 under the 2016 Plan. Awards are capped at the maximum, and no awards will vest unless the pre-established threshold performance level is met or exceeded. The “Grant Date Fair Value of Share Awards” represents the value of PSUs based on the expected outcome as of the date of grant. This result is based on (i) achieving the target level of a return on invested capital, or ROIC, which is weighted at 42.5%; (ii) achieving the target level of a free cash flow/share CAGR goal, which is weighted at 42.5%; and (iii) achieving the target level of progress towards the long-term ESG and sustainability targets, which is weighted at 15%. See “Compensation Discussion and Analysis — Equity-Based Compensation” for more information regarding PSU awards.
Executive Compensation Tables
Outstanding Equity Awards at 2021 Fiscal Year End The following table summarizes RSUs and other equity awards that have not vested and related information for each of our NEOs as of December 31, 2021. | | | | | | | | | | | | | | | | | Share Awards | | | | Name | | | Award
Type(1) | | | Grant
Date | | | Number of
Shares or Units
That Have Not
Vested
(#) | | | Market Value of
Shares or Units
That Have Not
Vested
($)(6) | | | 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
($)(7) | | | | Worthing F. Jackman | | | | | RSU | | | | | | 02/20/18 | | | | | | 2,427(2) | | | | | | 330,727 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/15/19 | | | | | | 4,707(3) | | | | | | 641,423 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/14/20 | | | | | | 10,669(4) | | | | | | 1,453,865 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/19/21 | | | | | | 18,653(5) | | | | | | 2,541,844 | | | | | | — | | | | | | — | | | | | | | PSU | | | | | | 02/15/19 | | | | | | — | | | | | | — | | | | | | 9,415 | | | | | | 1,282,982 | | | | | | | PSU | | | | | | 02/14/20 | | | | | | — | | | | | | — | | | | | | 14,225 | | | | | | 1,938,441 | | | | | | | PSU | | | | | | 02/19/21 | | | | | | — | | | | | | — | | | | | | 18,653 | | | | | | 2,541,844 | | | | | Mary Anne Whitney | | | | | RSU | | | | | | 02/20/18 | | | | | | 1,013(2) | | | | | | 138,042 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/15/19 | | | | | | 1,756(3) | | | | | | 239,290 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/14/20 | | | | | | 3,150(4) | | | | | | 429,251 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/19/21 | | | | | | 6,465(5) | | | | | | 880,986 | | | | | | — | | | | | | — | | | | | | | PSU | | | | | | 02/15/19 | | | | | | — | | | | | | — | | | | | | 3,512 | | | | | | 478,580 | | | | | | | PSU | | | | | | 02/14/20 | | | | | | — | | | | | | — | | | | | | 4,200 | | | | | | 572,334 | | | | | | | PSU | | | | | | 02/19/21 | | | | | | — | | | | | | — | | | | | | 6,465 | | | | | | 880,986 | | | | | Darrell W. Chambliss | | | | | RSU | | | | | | 02/20/18 | | | | | | 2,085(2) | | | | | | 284,123 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/15/19 | | | | | | 2,719(3) | | | | | | 370,518 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/14/20 | | | | | | 4,013(4) | | | | | | 546,852 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/19/21 | | | | | | 7,001(5) | | | | | | 954,026 | | | | | | — | | | | | | — | | | | | | | PSU | | | | | | 02/15/19 | | | | | | — | | | | | | — | | | | | | 5,439 | | | | | | 741,173 | | | | | | | PSU | | | | | | 02/14/20 | | | | | | — | | | | | | — | | | | | | 5,350 | | | | | | 729,045 | | | | | | | PSU | | | | | | 02/19/21 | | | | | | — | | | | | | — | | | | | | 7,001 | | | | | | 954,026 | | | | | Patrick J. Shea | | | | | RSU | | | | | | 02/20/18 | | | | | | 1,418(2) | | | | | | 193,231 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/15/19 | | | | | | 1,854(3) | | | | | | 252,645 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/14/20 | | | | | | 3,272(4) | | | | | | 445,875 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/19/21 | | | | | | 5,673(5) | | | | | | 773,060 | | | | | | — | | | | | | — | | | | | | | PSU | | | | | | 02/15/19 | | | | | | — | | | | | | — | | | | | | 3,708 | | | | | | 505,289 | | | | | | | PSU | | | | | | 02/14/20 | | | | | | — | | | | | | — | | | | | | 4,363 | | | | | | 594,546 | | | | | | | PSU | | | | | | 02/19/21 | | | | | | — | | | | | | — | | | | | | 5,673 | | | | | | 773,060 | | | | | James M. Little | | | | | RSU | | | | | | 02/20/18 | | | | | | 1,402(2) | | | | | | 191,051 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/15/19 | | | | | | 1,829(3) | | | | | | 249,238 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/14/20 | | | | | | 3,225(4) | | | | | | 439,471 | | | | | | — | | | | | | — | | | | | | | RSU | | | | | | 02/19/21 | | | | | | 5,519(5) | | | | | | 752,074 | | | | | | — | | | | | | — | | | | | | | PSU | | | | | | 02/15/19 | | | | | | — | | | | | | — | | | | | | 3,659 | | | | | | 498,612 | | | | | | | PSU | | | | | | 02/14/20 | | | | | | — | | | | | | — | | | | | | 4,300 | | | | | | 585,961 | | | | | | | PSU | | | | | | 02/19/21 | | | | | | — | | | | | | — | | | | | | 5,519 | | | | | | 752,074 | | |
(1)
“RSU” refers to restricted share units granted under the 2016 Plan. “PSU” refers to performance-based restricted share units granted under the 2016 Plan. (2)
Assuming that the first-year performance hurdle is satisfied, which in the case of these grants it was, the RSUs vest in equal installments on each of the first four anniversaries of the grant date of February 20, 2018. (3)
Assuming that the first-year performance hurdle is satisfied, which in the case of these grants it was, the RSUs vest in equal installments on each of the first four anniversaries of the grant date of February 15, 2019. 2022Notice of Annual Meeting & Proxy Statement51
Executive Compensation Tables
(4)
Assuming that the first-year performance hurdle is satisfied, which in the case of these grants it was, the RSUs vest in equal installments on each of the first four anniversaries of the grant date of February 14, 2020. (5)
The RSUs vest in equal installments on each of the first four anniversaries of the grant date of February 19, 2021. (6)
Based on the closing price of Common Shares of $136.27 on the NYSE on December 31, 2021, the last trading day of the 2021 fiscal year. (7)
Represents unearned Common Shares under the PSU awards granted in February 2019, February 2020 and February 2021. Based on guidance provided by the SEC, the targeted potential number of Common Shares for such grants has been assumed. The amounts shown include the full award for the performance periods ending on December 31, 2021, December 31, 2022 and December 31, 2023. The PSUs will vest, if at all, within 15 business days following the date on which the determination by the Compensation Committee is made with respect to the achievement of the performance goals, but in no event shall the vesting be later than March 15, 2022, March 15, 2023 and March 15, 2024, respectively. Shares Vested in Fiscal Year 2021 The following table summarizes each vesting of RSUs, PSUs and related information for each of our NEOs on an aggregated basis during 2021. | | | | | Share Awards | | | | Name | | | Number of Shares
Acquired on Vesting
(#) | | | Value Realized
on Vesting
($) | | | | Worthing F. Jackman | | | 15,972 | | | 1,588,161 | | | | Mary Anne Whitney | | | 5,868 | | | 583,727 | | | | Darrell W. Chambliss | | | 11,373 | | | 1,131,015 | | | | Patrick J. Shea | | | 7,904 | | | 786,029 | | | | James M. Little | | | 7,803 | | | 775,986 | |
Pension Benefits in Fiscal Year 2021 We do not sponsor any qualified or non-qualified defined benefit plans for any of our executive officers, including the NEOs. Nonqualified Deferred Compensation in Fiscal Year 2021 The following table summarizes the participation of our NEOs during 2021 in our Nonqualified Deferred Compensation Plan, which is our only plan that provides for the deferral of compensation on a basis that is not tax-qualified. | | Name | | | Executive
Contributions
in Last
Fiscal Year
($)(1) | | | Registrant
Contributions
in Last
Fiscal Year
($)(1) | | | Aggregate
Earnings in Last
Fiscal Year
($)(2) | | | Aggregate
Withdrawals/
Distributions
($) | | | Aggregate
Balance at
Last Fiscal
Year End
($)(3) | | | | Worthing F. Jackman | | | 39,250 | | | 14,250 | | | 36,105 | | | (65,113) | | | 226,583 | | | | Mary Anne Whitney | | | 27,212 | | | — | | | 190,593 | | | (194,796) | | | 1,369,156 | | | | Darrell W. Chambliss | | | — | | | — | | | 310,596 | | | (467,109) | | | 5,693,251 | | | | Patrick J. Shea | | | 48,158 | | | — | | | 134,607 | | | — | | | 909,150 | | | | James M. Little | | | — | | | — | | | 117,058 | | | — | | | 940,635 | |
(1)
Amounts in these columns represent base salary and cash annual incentive each NEO elected to defer and our annual matching contributions in lieu of matching contributions under our 401(k) plan. Contributions by an NEO are reported in the Summary Compensation Table under “Salary”, “Bonus” and/ or “Non-Equity Incentive Plan Compensation” and matching contributions we make to an NEO’s account are reported in the Summary Compensation Table under “All Other Compensation.” (2)
Amounts in this column are not included in any other amounts disclosed in this Proxy Statement, as the amounts are not preferential earnings. Instead, earnings disclosed are determined by reference to the returns on one or more select mutual funds, as determined by the participant, that are also available for investment by the general public. (3)
Amounts shown in this column include amounts reported as compensation to the NEO in the Summary Compensation Table in our previous proxy statements or annual reports on Form 10-K. The NEOs and certain other highly compensated employees are entitled to participate in the Nonqualified Deferred Compensation Plan. The Nonqualified Deferred Compensation Plan allows an eligible employee to voluntarily defer receipt of up to 80% of the employee’s base salary, and up to 100% of bonuses and
Executive Compensation Tables
commissions. We make a matching contribution of 100% of every dollar of a participating employee’s pre-tax eligible contributions until the employee’s contributions equal five percent of the employee’s eligible compensation, less the amount of any match we make on behalf of the employee under the Company-sponsored 401(k) plan, and subject to certain deferral limitations imposed by the IRC on 401(k) plans. Our matching contributions are 100% vested when made. The Company also credits an amount reflecting a deemed return to each participant’s deferred compensation account periodically, based on the returns of various mutual funds or measurement funds selected by the participant. The earnings on an employee’s deferred compensation may exceed or fall short of market rate returns, depending on the performance of the funds selected compared to the markets in general. The investment options offered by our plan administrator and their annual rates of return for the calendar year ended December 31, 2021, are set forth in the following table. | | Name of Investment Option | | | Rate of Return
in 2021 | | | | American Century VP Mid Cap Value I | | | 23.20% | | | | American Funds IS International 2 | | | -1.50% | | | | Legg Mason Partners Clearbridge Small Cap Growth | | | 12.61% | | | | BNY Mellon IP Small Cap Stock Index Svc | | | 26.14% | | | | Franklin Rising Dividends VIP 2 | | | 26.79% | | | | Franklin Small Cap Value VIP 2 | | | 25.37% | | | | Ivy VIP High Income II | | | 6.06% | | | | Janus Henderson VIT Balanced Svc | | | 16.91% | | | | Janus Henderson VIT Enterprise Svc | | | 19.18% | | | | MFS International Growth | | | 16.54% | | | | MFS VIT II International Intrinsic Value | | | 10.28% | | | | MFS VIT Value Svc | | | 25.16% | | | | NVIT Mid Cap Index I | | | 24.26% | | | | PIMCO VIT Real return Admin | | | 5.55% | | | | Pioneer Bond VCT I | | | .38% | | | | T. Rowe Price Limited-Term Bond | | | .14% | | | | VanEck VIP Emerging Markets Initial | | | -11.87% | | | | VanEck VIP Global Hard Assets Initial | | | 18.92% | | | | Vanguard VIF Capital Growth | | | 21.54% | | | | Vanguard VIF Money Market | | | 0.01% | | | | Vanguard VIF REIT Index | | | 40.21% | |
Distributions from the Nonqualified Deferred Compensation Plan are triggered by the occurrence of certain events, including termination of employment and scheduled in-service distributions as allowed by the Internal Revenue Service. Upon termination of employment or the scheduled in-service date, as applicable, a participant will receive a distribution from the plan in the form he or she previously selected — either in a lump sum or in annual installments over any period selected, up to fifteen years. Payments will commence within 60 days after the last day of the six-month period immediately following the termination date or the scheduled in-service date, as applicable. If a participant becomes disabled, he or she will receive his or her entire account balance in a lump sum within 60 days of the date on which he or she became disabled. Upon the death of a participant during employment or while receiving his or her benefits under the plan following termination of employment, his or her unpaid account balance will be paid to his or her beneficiary in a lump sum within 60 days of the date the plan committee is notified of his or her death. Participants also elect whether to receive a distribution of their entire account balance in a lump sum upon a change in control of the Company, as defined in the plan, or whether to have their account balance remain in the plan after a change in control. In the absence of such an election, a participant will receive a distribution after a change in control occurs. Participants may also choose to receive lump sum distributions of all or a portion of their account balances upon optional, scheduled distribution dates or upon an unforeseeable financial emergency. Optional distribution dates must be a January 1 that is at least three years after the end of the plan 2022Notice of Annual Meeting & Proxy Statement53
Executive Compensation Tables
year in which the deferral election is made. Optional distributions may be postponed, subject to certain conditions specified in the plan. Distributions upon an unforeseeable financial emergency are also subject to certain restrictions specified in the plan. Equity Compensation Plan Information The following is a summary of all of our equity compensation plans and individual arrangements that provide for the issuance of equity securities as compensation, as of December 31, 2021. | | | | | (a) | | | (b) | | | (c) | | | | Equity Compensation Plan Category | | | Number of securities to
be issued upon exercise
of outstanding warrants
and rights | | | Weighted average
exercise price of
outstanding warrants
and rights | | | Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding
securities reflected in
column (a)) | | | | Approved by shareholders(1) | | | | | 1,933,004(2) | | | | | $ | 104.82(3) | | | | | | 4,066,471(4) | | | | | Not approved by shareholders | | | | | — | | | | | | — | | | | | | — | | | | | TOTAL | | | | | 1,933,004 | | | | | $ | 104.82(3) | | | | | | 4,066,471 | | |
(1)
Consists of the following plans approved by the Company’s and Progressive Waste’s shareholders, as applicable, including the assumptions thereof by the Company on June 1, 2016: (a) the 2016 Plan; (b) the 2014 Incentive Award Plan; (c) the Third Amended and Restated 2004 Equity Incentive Plan; and (d) the Amended and Restated Share Option Plan adopted by Progressive Waste on July 22, 2009. (2)
Includes an aggregate of 962,556 RSUs, 392,043 PSUs, and 578,405 warrants. (3)
Excludes RSUs, PSUs and DSUs. (4)
The remaining 4,066,471 Common Shares reserved for issuance under the 2016 Plan will be issuable upon the exercise of future warrants or share option grants or pursuant to future restricted share, RSU or performance awards that vest upon the attainment of prescribed performance milestones or the completion of designated service periods. The Board of Directors unanimously adopted resolutions in 2014 approving the reduction of the shares available for future issuance under the Third Amended and Restated 2004 Equity Incentive Plan to zero, and the Board of Directors and the Executive Committee of the Company unanimously adopted resolutions in 2016 and 2017 approving the reduction of shares available for future issuance under each of the 2014 Incentive Award Plan and the Amended and Restated Share Option Plan to zero, and as a result no further awards will be granted under the Third Amended and Restated 2004 Equity Incentive Plan, the 2014 Incentive Award Plan or the Amended and Restated Share Option Plan. On June 1, 2016, the Board of Directors adopted the 2016 Plan, which was approved by Progressive Waste’s shareholders on May 26, 2016. On July 24, 2017, the Board of Directors approved certain housekeeping amendments to the 2016 Plan. On July 24, 2018, the Board of Directors approved certain additional housekeeping amendments to the 2016 Plan. None of the housekeeping amendments to the 2016 Plan required approval of the Company’s shareholders. A summary of the 2016 Plan is attached as Appendix B. The 2016 Plan, as amended, is administered by the Compensation Committee and provides that the aggregate number of Common Shares which may be issued from treasury pursuant to awards made under the 2016 Plan is 7,500,000 Common Shares, representing 2.91%(6) of our issued and outstanding Common Shares. Awards under the 2016 Plan may be made to employees, consultants and non-employee directors and may be made in the form of share options, warrants, restricted shares, RSUs, performance awards (which may be paid in cash, Common Shares, or a combination thereof), dividend equivalent awards (representing a right of the holder thereof to receive the equivalent value (which may be paid in cash or Common Shares) of dividends paid on Common Shares), and share payments (a payment in the form of Common Shares or a share option or other right to purchase Common Shares as part of a bonus, defined compensation or other arrangement). The 2016 Plan also provides for awards to non-employee directors in the form of DSUs, which represent the right to receive a cash payment or its equivalent in Common Shares (or a combination of cash and Common Shares), or which may at the time of grant be expressly limited to settlement only in cash and not in Common Shares. As of December 31, 2021, DSUs, RSUs, PSUs and Warrants were the only forms of awards granted under the 2016 Plan. As of December 31, 2021, under the 2016 Plan, there were 16,812 DSUs outstanding, representing 0.006% of our Common Shares then issued and outstanding, 861,695 RSUs outstanding, representing 0.331% of our Common Shares then issued and outstanding, 392,043 PSUs outstanding, representing 0.151% of our Common Shares then issued and outstanding, 578,405 Warrants outstanding, representing 0.222% of our Common Shares (6)
Based on 257,153,307 Common Shares outstanding as of the Record Date.
Executive Compensation Tables
then issued and outstanding, and 4,066,471 awards remained available for grant, representing 1.563% of our Common Shares then issued and outstanding. The annual burn rate under the 2016 Plan for the fiscal years ended 2019, 2020 and 2021 was 0.250%, 0.246% and 0.320%, respectively. The annual burn rate is calculated as (x) the number of securities (i.e., DSUs, RSUs, PSUs and Warrants) granted thereunder during the applicable fiscal year, divided by (y) the weighted average number of shares outstanding in 2021, calculated in accordance with the CPA Canada Handbook. Potential Payments upon Termination or Change in Control SEVERANCE ARRANGEMENTS IN EFFECT IN 2021 During 2021, our NEOs were eligible to receive separation benefits and change in control payments pursuant to the participation letter agreements under the Separation Benefits Plan that were entered into on July 25, 2019, for Messrs. Jackman, Chambliss, Shea and Little, and February 1, 2021 for Ms. Whitney. The following discussion assumes that a termination or resignation of employment occurred on December 31, 2021, as applicable, and describes the terms of these payments and benefits and the circumstances in which they will be paid or provided. Under the terms of the Separation Benefits Plan and their respective participation letter agreements, each of Ms. Whitney and Messrs. Jackman, Chambliss, Little and Shea is entitled to receive separation pay upon a termination by us without “cause” or resignation by such NEO for “good reason” prior to a change in control. The amount payable to Ms. Whitney and Messrs. Jackman, Chambliss, Shea and Little is: (i) a cash payment equal to 2.99x of his or her then-current base salary; and (ii) an amount equal to the target bonus for the year in which the termination occurs, which is 125% of Mr. Jackman’s base salary at the time of termination, and 85% of Ms. Whitney’s and Messrs. Chambliss’, Shea’s and Little’s base salary at the time of termination, payable in three equal installments over the two-year period following termination. In addition, under the terms of the Separation Benefits Plan, if an NEO is entitled to receive separation pay in connection with his or her termination of employment, then (i) the NEO is entitled to full accelerated vesting of his or her outstanding but unvested time-based equity awards; (ii) the designated performance goals of the applicable NEO’s performance-based equity awards shall be deemed to have been satisfied (and, for any award with different levels of potential payment, such performance shall be deemed to be at the target level), any remaining vesting conditions shall be deemed to be satisfied on the NEO’s date of termination and such awards shall be settled as soon as administratively practicable thereafter; and (iii) with respect to any outstanding share options held by the applicable NEO, an extended post-termination exercise period through the earlier of the third anniversary of the termination date or the expiration of the original term of such share options. The Company would also pay to each NEO who is entitled to receive separation pay an amount equal to the Company’s portion (but not the NEO’s portion) of the cost of medical, dental and other health plan insurance for the NEO (and the NEO’s spouse and children) at the rate in effect on the date of termination for a period of two years from the date of termination (the “NEO Health Insurance Benefit”). As a condition to an NEO’s receipt of any severance benefits under the Separation Benefits Plan, the NEO is required to release and waive (and not revoke) all claims against the WCI Group. The Separation Benefits Plan defines “WCI Group” as the Company and each of its subsidiaries and affiliates. Each NEO is also entitled to the foregoing benefits if such NEO’s employment is terminated as a result of the NEO’s death or disability, except that in the event of death, the estate shall not receive the NEO Health Insurance Benefit. Upon a termination by us without cause or resignation by the NEO for good reason within two years after a change in control, the NEOs are each entitled to receive the benefits described above for a termination without cause, payable in a lump sum on or within 60 days following the date of termination. Further, the Separation Benefits Plan includes a so-called “best pay” provision where payments and benefits provided on account of a change in control shall be made to such participating NEOs in full or in such lesser amount as would result in no portion of the payments being subject to an excise tax under Section 280G and Section 4999 of the IRC, whichever of the foregoing amounts is greater on an after-tax basis. In consideration of the above severance benefits, the NEOs must abide by certain restrictive covenants in the Separation Benefits Plan, including a commitment by each NEO not to compete with the Company in a restricted 2022Notice of Annual Meeting & Proxy Statement55
Executive Compensation Tables
territory and not to solicit our customers or employees for 12 months following the date of such NEO’s termination of employment. For purposes of the Separation Benefits Plan, “good reason” is generally defined as: (i) assignment to the NEO of duties inconsistent with and resulting in a diminution of the NEO’s position (including status, offices, titles, responsibilities and reporting requirements), authority, duties or responsibilities as they existed on the effective date of the Separation Benefits Plan; or any other action by the Company which results in a diminution in such position, authority, duties or responsibilities; a substantial alteration in the title(s) of the NEO (so long as the existing corporate structure of the WCI Group is maintained); provided, however, that the NEO’s failure to be in the same position (including status, offices, titles, responsibilities and reporting requirements) with the Company will constitute “good reason”; (ii) the relocation of the NEO’s principal place of employment to a location more than fifty (50) miles from its present location without the NEO’s prior approval; (iii) a material reduction by the Company in the NEO’s total annual cash compensation (base and bonus) without the NEO’s prior approval; (iv) on or after a change in control, a material reduction by the Company in the NEO’s total annual compensation (base, bonus, and equity opportunities) without the NEO’s prior approval; (v) a failure by the WCI Group to continue in effect, without substantial change, any benefit plan or arrangement in which the NEO was participating or the taking of any action by the WCI Group which would adversely affect the NEO’s participation in or materially reduce the NEO’s benefits under any benefit plan (unless such changes apply equally to all other management employees of the Company); (vi) any material breach by the Company of any provision of the Separation Benefits Plan without the NEO having committed any material breach of the NEO’s obligations thereunder, which breach is not cured within twenty (20) days following written notice thereof to the Company of such breach; or (vii) the failure of the Company to obtain the assumption of the plan by any successor entity that causes the NEO to be employed by an entity that is not a member of the WCI Group. For the purposes of the Separation Benefits Plan, “cause” is defined as: (i) a material breach of any of the terms of the agreement or any other agreement with the Company or any member of the WCI Group or any policy of the WCI Group; (ii) a breach of any of the provisions of the confidentiality, property, non-competition and non-solicitation provisions of the Separation Benefits Plan; (iii) gross negligence or willful misconduct of a material nature in connection with the performance of the NEO’s duties; (iv) conviction of (or pleading guilty or no contest or nolo contendere to) a felony; or (v) an intentional act of dishonesty or misappropriation (or attempted misappropriation) of property belonging to the Company or any member of the WCI Group. Further, for the purposes of the Separation Benefits Plan, a “change in control” is deemed to have occurred if: •
there shall be consummated (a) any reorganization, liquidation or consolidation of the Company, or any merger or other business combination of the Company with any other corporation, other than any such merger or other business combination that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 50% of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such transaction; or (b) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the assets of the Company; or •
any person (as defined in Section 13(d) and 14(d) of the Exchange Act), shall become the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 50% or more of the Company’s outstanding voting securities; or •
during any period of two consecutive years, individuals who at the beginning of such period constituted the entire Board of Directors shall cease for any reason to constitute at least one-half of the membership thereof unless the election, or the nomination for election by the Company’s shareholders, of each new director was approved by a vote of at least one-half of the directors then still in office who were directors at the beginning of the period. The NEOs’ participation letter agreements under the Separation Benefits Plan further deem a “change in control” to have occurred if: •
any “person” (as defined in Section 13(d) and 14(d) of the Exchange Act), shall become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 50% or more of the outstanding voting securities of a subsidiary of the Company that owns all or substantially all of the WCI Group’s United States operations; •
there is a reorganization, merger or other business combination of a subsidiary of the Company that owns all or substantially all of the WCI Group’s United States operations with any other corporation, other than
Executive Compensation Tables
any such merger or other combination that would result in the voting securities of the subsidiary outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 50% of the total voting power represented by the voting securities of the subsidiary or such surviving entity outstanding immediately after such transaction; or •
there is a direct or indirect sale, lease, exchange or other transfer (in one transaction or a series of related transactions) by the WCI Group of all, or substantially all, of its United States operations. Potential Payments Tables The following tables estimate the payments we would be obligated to make to each of our NEOs as a result of the NEO’s termination (including, in certain cases, in connection with a change in control of the Company) or resignation, assuming such termination or resignation occurred on December 31, 2021. We have calculated the estimated payments to meet SEC disclosure requirements. The estimated payments are not necessarily indicative of the actual amounts any of our NEOs would receive in such circumstances. For illustrative purposes only, the tables assume that: (a) a termination or resignation of employment occurred on December 31, 2021, as applicable; and (b) the price per share of the Common Shares.Shares is $136.27, the closing price on December 31, 2021, on the NYSE, the last trading day of the 2021 fiscal year. In addition to the amounts reflected in the tables, on termination of employment, all vested deferred compensation and other retirement benefits payable to the employee under benefit plans in which he or she then participated would be paid to the NEO in accordance with the provisions of the respective plans. These plans include our voluntary 401(k) plan and our Nonqualified Deferred Compensation Plan. WASTE CONNECTIONS, INC. WORTHING F. JACKMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER
| | | | | Termination
for Cause | | | Termination
Without
Cause | | | Termination
on Disability | | | Termination
on Death | | | Termination
by Employee
For Good
Reason | | | Termination
by Employee
Without
Good
Reason | | | Termination
in Connection
with Change
in Control | | | | Base Salary | | | | $ | —(1) | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | —(1) | | | | | $ | — | | | | | Bonus | | | | | —(2) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | —(2) | | | | | | — | | | | | Severance Payment | | | | | — | | | | | | 3,850,931(4) | | | | | | 3,850,931(4) | | | | | | 3,816,000(5) | | | | | | 3,850,931(4) | | | | | | — | | | | | | 3,850,931(4) | | | | | Unvested Share
Options,
Restricted
Share Units and
Other Equity in
Company | | | | | —(3) | | | | | | 10,731,126(6) | | | | | | 10,731,126(6) | | | | | | 10,731,126(6) | | | | | | 10,731,126(6) | | | | | | —(3) | | | | | | 10,731,126(7) | | | | | TOTAL | | | | $ | — | | | | | $ | 14,582,057 | | | | | $ | 14,582,057 | | | | | $ | 14,547,126 | | | | | $ | 14,582,057 | | | | | $ | — | | | | | $ | 14,582,057 | | |
(1)
Reflects the employee’s base salary to the date of termination, paid in a lump sum, which is assumed to have been paid in full. (2)
Employee will forfeit his bonus for the year in which such a termination occurs. (3)
All of employee’s unvested share options, RSUs, PSUs and other equity awards will be forfeited upon such a termination. (4)
Reflects an amount equal to the sum of (i) 2.99x of Mr. Jackman’s then-current base salary; (ii) Mr. Jackman’s target bonus for the year in which the termination occurs, which is 125% of his base salary at the time of termination; and (iii) the NEO Health Insurance Benefit. (5)
Reflects an amount equal to the sum of (i) 2.99x of Mr. Jackman’s then-current base salary; and (ii) Mr. Jackman’s target bonus for the year in which the termination occurs, which is 125% of his base salary at the time of termination. (6)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Mr. Jackman does not currently hold any share options. (7)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. Pursuant to the Separation Benefits Plan, in the event of a change in control followed by a termination of Mr. Jackman’s employment by the Company without cause or by Mr. Jackman for good reason, in each case within two years of the change in control, outstanding but unvested RSUs and PSUs shall automatically vest in full, and the shares subject to those vested RSUs and PSUs shall be issued. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Mr. Jackman does not currently hold any share options. 2022| Notice of Annual Meeting & Proxy Statement57
Executive Compensation Tables
MARY ANNE WHITNEY, EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER | | | | | Termination
for Cause | | | Termination
Without
Cause | | | Termination
on Disability | | | Termination
on Death | | | Termination
by Employee
For Good Reason | | | Termination
by Employee
Without Good
Reason | | | Termination
in Connection
with Change
in Control | | | | Base Salary | | | | $ | —(1) | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | —(1) | | | | | $ | — | | | | | Bonus | | | | | —(2) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | —(2) | | | | | | — | | | | | Severance Payment | | | | | — | | | | | | 2,146,931(4) | | | | | | 2,146,931(4) | | | | | | 2,112,000(5) | | | | | | 2,146,931(4) | | | | | | — | | | | | | 2,146,931(4) | | | | | Unvested
Share
Options,
Restricted
Share
Units and
Other
Equity in
Company | | | | | —(3) | | | | | | 3,619,467(6) | | | | | | 3,619,467(6) | | | | | | 3,619,467(6) | | | | | | 3,619,467(6) | | | | | | —(3) | | | | | | 3,619,467(7) | | | | | TOTAL | | | | $ | — | | | | | $ | 5,766,399 | | | | | $ | 5,766,399 | | | | | $ | 5,731,467 | | | | | $ | 5,766,399 | | | | | $ | — | | | | | $ | 5,766,399 | | |
(1)
Reflects the employee’s base salary to the date of termination, paid in a lump sum, which is assumed to have been paid in full. (2)
Employee will forfeit her bonus for the year in which such a termination occurs. (3)
All of employee’s unvested share options, RSUs, PSUs and other equity awards will be forfeited upon such a termination. (4)
Reflects an amount equal to the sum of (i) 2.99x of Ms. Whitney’s then-current base salary; (ii) Ms. Whitney’s target bonus for the year in which the termination occurs, which is 85% of her base salary at the time of termination; and (iii) the NEO Health Insurance Benefit. (5)
Reflects an amount equal to the sum of (i) 2.99x of Ms. Whitney’s then-current base salary; and (ii) Ms. Whitney’s target bonus for the year in which the termination occurs, which is 85% of her base salary at the time of termination. (6)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Ms. Whitney does not currently hold any share options. (7)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. Pursuant to the Separation Benefits Plan, in the event of a change in control followed by a termination of Ms. Whitney’s employment by the Company without cause or by Ms. Whitney for good reason, in each case within two years of the change in control, outstanding but unvested RSUs and PSUs shall automatically vest in full, and the shares subject to those vested RSUs and PSUs shall be issued. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Ms. Whitney does not currently hold any share options. DARRELL W. CHAMBLISS, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER | | | | | Termination
for Cause | | | Termination
Without
Cause | | | Termination
on Disability | | | Termination
on Death | | | Termination
by Employee
For Good
Reason | | | Termination
by Employee
Without Good
Reason | | | Termination
in Connection
with Change
in Control | | | | Base Salary | | | | $ | —(1) | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | —(1) | | | | | $ | — | | | | | Bonus | | | | | —(2) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | —(2) | | | | | | — | | | | | Severance Payment | | | | | — | | | | | | 2,165,278(4) | | | | | | 2,165,278(4) | | | | | | 2,131,200(5) | | | | | | 2,165,278(4) | | | | | | — | | | | | | 2,165,278(4) | | | | | Unvested Share
Options,
Restricted
Share Units
and Other
Equity in
Company | | | | | —(3) | | | | | | 4,579,762(6) | | | | | | 4,579,762(6) | | | | | | 4,579,762(6) | | | | | | 4,579,762(6) | | | | | | —(3) | | | | | | 4,579,762(7) | | | | | TOTAL | | | | $ | — | | | | | $ | 6,745,040 | | | | | $ | 6,745,040 | | | | | $ | 6,710,962 | | | | | $ | 6,745,040 | | | | | $ | — | | | | | $ | 6,745,040 | | |
(1)
Reflects the employee’s base salary to the date of termination, paid in a lump sum, which is assumed to have been paid in full. (2)
Employee will forfeit his bonus for the year in which such a termination occurs. (3)
All of employee’s unvested share options, RSUs, PSUs and other equity awards will be forfeited upon such a termination.
Executive Compensation Tables
(4)
Reflects an amount equal to the sum of (i) 2.99x of Mr. Chambliss’ then-current base salary; (ii) Mr. Chambliss’ target bonus for the year in which the termination occurs, which is 85% of his base salary at the time of termination; and (iii) the NEO Health Insurance Benefit. (5)
Reflects an amount equal to the sum of (i) 2.99x of Mr. Chambliss’ then-current base salary; and (ii) Mr. Chambliss’ target bonus for the year in which the termination occurs, which is 85% of his base salary at the time of termination. (6)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Mr. Chambliss does not currently hold any share options. (7)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. Pursuant to the Separation Benefits Plan, in the event of a change in control followed by a termination of Mr. Chambliss’ employment by the Company without cause or by Mr. Chambliss for good reason, in each case within two years of the change in control, outstanding but unvested RSUs and PSUs shall automatically vest in full, and the shares subject to those vested RSUs and PSUs shall be issued. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Mr. Chambliss does not currently hold any share options. PATRICK J. SHEA, EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY | | | | | Termination
for Cause | | | Termination
Without
Cause | | | Termination
on Disability | | | Termination
on Death | | | Termination
by Employee
For Good
Reason | | | Termination
by Employee
Without Good
Reason | | | Termination
in Connection
with Change
in Control | | | | Base Salary | | | | $ | —(1) | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | —(1) | | | | | $ | — | | | | | Bonus | | | | | —(2) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | —(2) | | | | | | — | | | | | Severance Payment | | | | | — | | | | | | 1,801,331(4) | | | | | | 1,801,331(4) | | | | | | 1,766,400(5) | | | | | | 1,801,331(4) | | | | | | — | | | | | | 1,801,331(4) | | | | | Unvested Share
Options,
Restricted
Share Units
and Other
Equity in
Company | | | | | —(3) | | | | | | 3,537,705(6) | | | | | | 3,537,705(6) | | | | | | 3,537,705(6) | | | | | | 3,537,705(6) | | | | | | —(3) | | | | | | 3,537,705(7) | | | | | TOTAL | | | | $ | — | | | | | $ | 5,339,037 | | | | | $ | 5,339,037 | | | | | $ | 5,304,105 | | | | | $ | 5,339,037 | | | | | $ | — | | | | | $ | 5,339,037 | | |
(1)
Reflects the employee’s base salary to the date of termination, paid in a lump sum, which is assumed to have been paid in full. (2)
Employee will forfeit his bonus for the year in which such a termination occurs. (3)
All of employee’s unvested share options, RSUs, PSUs and other equity awards will be forfeited upon such a termination. (4)
Reflects an amount equal to the sum of (i) 2.99x of Mr. Shea’s then-current base salary; (ii) Mr. Shea’s target bonus for the year in which the termination occurs, which is 85% of his base salary at the time of termination; and (iii) the NEO Health Insurance Benefit. (5)
Reflects an amount equal to the sum of (i) 2.99x of Mr. Shea’s then-current base salary; and (ii) Mr. Shea’s target bonus for the year in which the termination occurs, which is 85% of his base salary at the time of termination. (6)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Mr. Shea does not currently hold any share options. (7)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. Pursuant to the Separation Benefits Plan, in the event of a change in control followed by a termination of Mr. Shea’s employment by the Company without cause or by Mr. Shea for good reason, in each case within two years of the change in control, outstanding but unvested RSUs and PSUs shall automatically vest in full, and the shares subject to those vested RSUs and PSUs shall be issued. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Mr. Shea does not currently hold any share options. 2022Notice of Annual Meeting & Proxy Statement59
Executive Compensation Tables
JAMES M. LITTLE, EXECUTIVE VICE PRESIDENT — ENGINEERING AND DISPOSAL | | | | | Termination
for Cause | | | Termination
Without
Cause | | | Termination
on Disability | | | Termination
on Death | | | Termination
by Employee
For Good
Reason | | | Termination
by Employee
Without Good
Reason | | | Termination
in Connection
with Change
in Control | | | | Base Salary | | | | $ | —(1) | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | —(1) | | | | | $ | — | | | | | Bonus | | | | | —(2) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | —(2) | | | | | | — | | | | | Severance Payment | | | | | — | | | | | | 1,751,411(4) | | | | | | 1,751,411(4) | | | | | | 1,716,480(5) | | | | | | 1,751,411(4) | | | | | | — | | | | | | 1,751,411(4) | | | | | Unvested Share
Options,
Restricted
Share Units
and Other
Equity in
Company | | | | | —(3) | | | | | | 3,468,480(6) | | | | | | 3,468,480(6) | | | | | | 3,468,480(6) | | | | | | 3,468,480(6) | | | | | | —(3) | | | | | | 3,468,480(7) | | | | | TOTAL | | | | $ | — | | | | | $ | 5,219,891 | | | | | $ | 5,219,891 | | | | | $ | 5,184,960 | | | | | $ | 5,219,891 | | | | | $ | — | | | | | $ | 5,219,891 | | |
(1)
Reflects the employee’s base salary to the date of termination, paid in a lump sum, which is assumed to have been paid in full. (2)
Employee will forfeit his bonus for the year in which such a termination occurs. (3)
All of employee’s unvested share options, RSUs, PSUs and other equity awards will be forfeited upon such a termination. (4)
Reflects an amount equal to the sum of (i) 2.99x of Mr. Little’s then-current base salary; (ii) Mr. Little’s target bonus for the year in which the termination occurs, which is 85% of his base salary at the time of termination; and (iii) the NEO Health Insurance Benefit. (5)
Reflects an amount equal to the sum of (i) 2.99x of Mr. Little’s then-current base salary; and (ii) Mr. Little’s target bonus for the year in which the termination occurs, which is 85% of his base salary at the time of termination. (6)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Mr. Little does not currently hold any share options. (7)
Reflects the immediate vesting of all of the employee’s outstanding but unvested share options, RSUs, PSUs and other equity awards as of the date of termination. Pursuant to the Separation Benefits Plan, in the event of a change in control followed by a termination of Mr. Little’s employment by the Company without cause or by Mr. Little for good reason, in each case within two years of the change in control, outstanding but unvested RSUs and PSUs shall automatically vest in full, and the shares subject to those vested RSUs and PSUs shall be issued. The exercisability of any such share options will be extended to the earlier of the expiration of the term of such share options or the third anniversary of the date of termination. No value for the extension was included since Mr. Little does not currently hold any share options.
Certain Relationships and Related Transactions
Certain Relationships and Related Transactions 2021 PROXY STATEMENTRelated Party Transactions For 2021, there are no related party transactions among our executive officers and directors, other than those disclosed below. Since June 2016, Namen Chambliss has held the position of Director of Network and Integrations for the Company. From January 2005 to that date, Mr. N. Chambliss held the position of Network Manager for the Company. Mr. N. Chambliss is the brother of Darrell W. Chambliss, our Executive Vice President and Chief Operating Officer. The total salary and incentive compensation we paid to Mr. N. Chambliss in 2021 was $173,483. As of December 31, 2021, Mr. N. Chambliss’ annual salary was $140,000. In addition, Mr. N. Chambliss had $51,719 of RSUs vest in 2021. In 2021, we granted Mr. N. Chambliss 511 RSUs on the same general terms and conditions as RSUs granted to other employees at the same management level. Since August 2019, Michelle Little has held the position of Executive Director — Engagement Solutions/HRIS for the Company. From January 2018 to that date, Ms. Little held the position of Vice President17 — Accounting for the Company. From December 2007 to January 2018, Ms. Little held the position of Director of Accounting for the Company. Ms. Little is the spouse of James M. Little, our Executive Vice President — Engineering and Disposal. The total salary and incentive compensation we paid to Ms. Little in 2021 was $337,499. As of December 31, 2021, Ms. Little’s annual salary was $237,500. In addition, Ms. Little had $195,648 of RSUs and PSUs vest in 2021. In 2021, we granted Ms. Little 1,380 RSUs on the same general terms and conditions as RSUs granted to other employees at the same management level. Indebtedness of Directors and Officers As of the date of this Proxy Statement, no current or proposed director, NEO or other corporate officer of the Company, or any former director, NEO or other corporate officer of the Company, or any associate of any of the foregoing, is, or has been at any time during 2021, indebted to the Company or its subsidiaries, either in connection with the purchase of securities of the Company or otherwise. Interest of Informed Persons and Others in Material Transactions The management of the Company is not aware of any material interest, direct or indirect, of any informed person of the Company (as defined in Section 1.1 of National Instrument 51-102 — Continuous Disclosure Obligations of the Canadian Securities Administrators), any proposed director or any associate or affiliate of any informed person or proposed director in any transaction since the commencement of the Company’s most recently completed financial year, or in any proposed transaction, that has materially affected or would materially affect the Company or any of its affiliates or subsidiaries. Review, Approval or Ratification of Transactions with Related Persons The Nominating and Corporate Governance Committee developed, and the Board of Directors approved our Corporate Governance Guidelines and Board Charter and our Code of Conduct and Ethics, including a Code of Ethics for Senior Financial Officers, as required by Section 406 of the United States Sarbanes-Oxley Act of 2002 and the rules of the SEC and applicable Canadian securities laws. The Nominating and Corporate Governance Committee reviews the Corporate Governance Guidelines and Board Charter and the Code of Conduct and Ethics on an annual basis, or more frequently if appropriate, and recommends to the Board of Directors changes as necessary. In addressing conflicts of interest, the Code of Conduct and Ethics provides that no officer, director or employee may be subject to influences, interests or relationships that conflict with the best interests of the Company. It 2022Notice of Annual Meeting & Proxy Statement61
Certain Relationships and Related Transactions
states that a conflict of interest exists when a person is in a position to influence a decision that may personally benefit that person or a person he or she is related to, legally or by blood or marriage as a result of the Company’s business dealings. The Code of Conduct and Ethics provides that each officer, director and employee must avoid any investment, interest or association that interferes or might interfere with that person’s independent exercise of judgment in the Company’s best interests, and that service to the Company should never be subordinated to personal gain or advantage. In an effort to help avoid these and other conflicts of interest, the Code of Conduct and Ethics sets forth certain rules the Company has adopted, including rules that prohibit: (a) officers, directors, and any employees who buy or sell goods or services or have responsibility connected to buying and selling for or on behalf of the Company, as well as the members of their respective families, from having certain economic interests in business concerns that transact business with the Company or are in competition with it; (b) officers, directors or employees from (directly or indirectly) giving or accepting certain gifts to or from any person soliciting or doing business with the Company; (c) officers of the Company from serving as a director of any other company that is organized for profit without the written approval of the Nominating and Corporate Governance Committee; and (d) officers, directors or employees from having any material interest in a business that deprives the Company of any business opportunity or is in any way detrimental to the Company. Each officer and director must report all actual or potential conflicts of interest to the Nominating and Corporate Governance Committee. Directors must also comply with the conflict provisions relating to directors set forth in our Corporate Governance Guidelines and Board Charter and prescribed by the Business Corporations Act (Ontario) (the “OBCA”). The Nominating and Corporate Governance Committee will resolve all conflicts of interest involving officers or directors. If a conflict involves a member of the Nominating and Corporate Governance Committee, that committee will resolve the conflict only if there are two disinterested directors remaining on that committee. Otherwise, the matter will be resolved by the entire Board of Directors. If a significant conflict exists involving a director that cannot be resolved and cannot be waived, the director must resign. The Nominating and Corporate Governance Committee has the sole authority to waive provisions of our Code of Conduct and Ethics with respect to executive officers and directors in specific circumstances where it determines that such waiver is appropriate, subject to compliance with applicable laws and regulations. Any such waivers will be promptly disclosed to our shareholders to the extent required by applicable laws and regulations.
Audit-Related Matters The Audit Committee has prepared the following report for the Company’s shareholders. The Audit Committee of the Company, whose chairman is Mr. Harlan and whose other members are Ms. Jordan and Messrs. Hughes and Razzouk, met four times during 2021. The Audit Committee of the Company is composed of independent, non-employee directors and operates under a written charter adopted by the Board of Directors. The Audit Committee is directly responsible for the appointment, oversight, qualification, independence, performance, compensation and retention of the Company’s independent registered public accounting firm, including audit fee negotiations and approval. The Audit Committee also is responsible for the selection of the lead engagement partner, and as required by law, assures rotation of the lead partner every five years. Management is responsible for the Company’s internal controls and the financial reporting process. The Company’s independent registered public accounting firm is responsible for: (i) auditing the effectiveness of the Company’s internal control over financial reporting based on its audit; and (ii) performing an independent audit of the Company’s consolidated financial statements in accordance with generally accepted auditing standards in the U.S. and issuing a report thereon. The Audit Committee’s responsibilities are to review the Company’s internal controls and the objectivity of its financial reporting, and to meet with appropriate financial personnel and the Company’s independent registered public accounting firm in connection with these reviews. The Audit Committee also reviews the professional services provided by the Company’s independent registered public accounting firm and reviews such other matters concerning the Company’s accounting principles and financial and operating policies, controls and practices, its public financial reporting policies and practices, and the results of its annual audit as the Audit Committee may find appropriate or as may be brought to the Audit Committee’s attention. In this context, the Audit Committee has met and held discussions with the Company’s management and its independent registered public accounting firm and meets periodically with both the Company’s internal auditors and its independent registered public accounting firm without management present. Management represented to the Audit Committee that the Company’s consolidated financial statements were prepared in accordance with GAAP, and the Audit Committee has reviewed and discussed the audited consolidated financial statements with management and the independent registered public accounting firm. The Audit Committee discussed with the independent registered public accounting firm the matters required to be discussed by Public Company Accounting Oversight Board, or PCAOB, Auditing Standard No. 1301 (Communications with Audit Committees).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 communication with the Audit Committee concerning independence. The Audit Committee discussed with the independent registered public accounting firm the firm’s independence and considered the compatibility of non-audit services with the auditor’s independence. Based on the Audit Committee’s review and discussions referred to above, the Audit Committee recommended that the Board of Directors include the audited consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC and the securities commissions or similar regulatory authorities in Canada on February 17, 2022. This report is submitted on behalf of the Audit Committee. Michael W. Harlan, Chairman
Larry S. Hughes
Elise L. Jordan
William J. Razzouk 2022Notice of Annual Meeting & Proxy Statement63
Audit Committee Pre-Approval Policies and Procedures The Audit Committee has adopted a policy that requires advance approval of all audits, audit-related, tax and other services performed by the independent registered public accounting firm. The policy provides for pre-approval by the Audit Committee of specifically defined audit and non-audit services. Unless the specific service has been previously pre-approved with respect to that year, the Audit Committee must approve the permitted service before the independent registered public accounting firm is engaged to perform it. The Audit Committee has delegated to the chairman of the Audit Committee authority to approve permitted services, provided that the chairman reports all approvals to the Audit Committee at its next meeting. All of the fees described in the table on page 69 under “Audit Fees”, “Audit-Related Fees”, “Tax Fees” and “All Other Fees” were approved by the Audit Committee.
Proposals What am I being asked to vote on? The Board of Directors is composed of eight directors. At the Meeting, you will be asked to elect each of the eight current directors to serve until the close of business of the 20222023 Annual Meeting of Shareholders of the Company or until any such director’s earlier resignation, or his or her successor is duly elected or appointed. The election of each director nominee may be approved by any one or more shareholders voting “FOR” each such director nominee (i.e., a plurality vote). You may either vote “FOR” or “WITHHOLD” your vote with respect to the election of each director nominee. If you vote “FOR” the election of a nominee, your vote will be cast accordingly. If you select “WITHHOLD” with respect to the election of a nominee, your vote will not be counted as a vote cast for the purposes of electing such nominee but will be considered in the application of the majority voting policy included in our Corporate Governance Guidelines and Board Charter. Pursuant to our majority voting policy, a “WITHHOLD” vote is considered a vote cast for purposes of the election of the director nominee and is equivalent to a vote against the nominee. Pursuant to the Company’s Corporate Governance Guidelines and Board Charter, each director of the Company must be elected by a “majority of the votes cast” with respect to his or her election. A “majority of the votes cast” means that the number of shares voted “for” a director’s election exceeds 50% of the number of votes cast with respect to that director’s election. Votes cast with respect to that director’s election will include votes to withhold authority, but will exclude abstentions, broker non-votes, and failures to vote with respect to that director’s election. See “Majority Voting for Directors” on page 12pages 13 and 14 of this Proxy Statement. Proxies will be voted, unless otherwise indicated, for the election of all eight nominees to our Board of Directors. Proxies will be voted in a discretionary manner if any of the eight nominees is unable to serve.  | How should I vote my shares on Proposal 1?THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ELECTION OF EACH OF THE EIGHT NOMINEES TO THE BOARD OF DIRECTORS. |
RONALD J. MITTELSTAEDT | | | | EXECUTIVE CHAIRMAN
Waste Connections, Inc.
| Age 57
California, U.S.A.
Director since:
September 1997
NOT Independent
| | BOARD/COMMITTEE MEMBERSHIP: | BOARD & COMMITTEE ATTENDANCE IN 2020: 100% | | ■ | Board | | | ■ | Executive Committee | | | | | COMMON SHARES OWNED OR CONTROLLED: 190,201 | | | | | | | | | |
BIOGRAPHY:
Mr. Mittelstaedt has been Executive Chairman of Waste Connections since July 2019. From the Company’s formation in 1997 to that date, he served as Chief Executive Officer of Waste Connections. Mr. Mittelstaedt has served as a director of Waste Connections since its formation, and was elected Chairman in January 1998. Mr. Mittelstaedt also served as President of Waste Connections from its formation through August 2004. Mr. Mittelstaedt has more than 32 years of experience in the solid waste industry. Under Mr. Mittelstaedt’s leadership, the Company became the third largest company in the North American solid waste and recycling industry, employing nearly 19,000 people across the U.S. and Canada. Mr. Mittelstaedt also established the RDM Positive Impact Foundation in 2004 to improve the lives of underprivileged and at-risk children. Prior to his career in the solid waste and recycling industry, he spent three years in the air freight industry. Mr. Mittelstaedt serves as a director for SkyWest, Inc. and is also a director for Pride Industries, a non-profit organization which provides manufacturing, supply chain, logistics and facilities services to public and private organizations nationwide, while creating jobs for people with disabilities. Mr. Mittelstaedt holds a B.A. degree in Business Economics with a finance emphasis from the University of California at Santa Barbara.
We believe that Mr. Mittelstaedt’s qualifications to serve on our Board of Directors include his extensive experience in the solid waste industry, including as our founder, our CEO from the formation of the Company until July 2019, and a director since the Company was formed in 1997 and our Board Chairman since 1998.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 18
EDWARD E. “NED” GUILLET | CORPORATE DIRECTOR/CONSULTANT | | Age 69
California, U.S.A.
Director since:
March 2007
Independent
| | BOARD/COMMITTEE MEMBERSHIP: | BOARD & COMMITTEE ATTENDANCE IN 2020: 100% | | ■ | Board | | | ■ | Compensation Committee | | | ■ | Nominating and Corporate Governance Committee | | | | | | | | | COMMON SHARES OWNED OR CONTROLLED, INCLUDING DSUs: 35,264 | | | | | |
BIOGRAPHY:
Mr. Guillet has been an independent freelance human resources consultant since January 2007. From October 2005 until December 2006, he was Senior Vice President, Human Resources for the Gillette Global Business Unit of The Procter & Gamble Company, a position he held subsequent to the merger of Gillette with Procter & Gamble. From July 2001 until September 2005, Mr. Guillet was Senior Vice President and Chief Human Resources Officer and an executive officer of The Gillette Company, a global consumer products company. He joined Gillette in 1974 and held a broad range of leadership positions in its human resources department. From 2008 to 2019, Mr. Guillet served as a Director of CCL Industries Inc., the largest label company in the world providing innovative solutions to the Home & Personal Care, Food & Beverage, Healthcare & Specialty, Automotive, Electronic & Consumer Durables and Retail & Apparel markets worldwide, where he also served as the Chairman of the Board of Directors’ Human Resources Committee and as a member of its Nominating & Governance Committee. Mr. Guillet is a former member of Boston University’s Human Resources Policy Institute. He holds a B.A. degree in English Literature and Secondary Education from Boston College.
We believe that Mr. Guillet’s qualifications to serve on our Board of Directors include his past experience on our Board of Directors, his substantial experience with human resources and personnel development matters, and the positions he has held with other publicly-traded companies (including a publicly-traded company in Canada).
MICHAEL W. HARLAN | CHAIRMAN & CHIEF EXECUTIVE OFFICER | TruHorizon Environmental Solutions | Age 60
Texas, U.S.A.
Director since:
May 1998
Independent
| | BOARD/COMMITTEE MEMBERSHIP: | BOARD & COMMITTEE ATTENDANCE IN 2020: 100% | | ■ | Board | | | ■ | Audit Committee | | | ■ | Executive Committee | | | ■ | Nominating and Corporate Governance Committee | | | | | | | | | COMMON SHARES OWNED OR CONTROLLED, INCLUDING DSUs: 10,916 | | | | | |
BIOGRAPHY:
Mr. Harlan is the Chairman of the Board of Directors and Chief Executive Officer of Principal Environmental, L.L.C., doing business as TruHorizon Environmental Solutions, a privately-held company that provides environmental regulatory compliance services, and a position he has held since September 2013. Mr. Harlan joined the Board of Directors of Brewer Crane Holdings, LLC, in July 2018. Brewer Crane is a privately-held company that provides customers in Southern California with a wide range of crane, rigging, trucking, and construction services. In July 2020, Mr. Harlan joined the Board of Directors of WiMi Hologram Cloud, Inc. (NASDAQ: WIMI), a publicly-traded provider of integrated holographic augmented reality applications in China. Since September 2011, he is the founder and has served as President of Harlan Capital Advisors, LLC, a private consulting firm focused on advising companies on operational matters, strategic planning, mergers and acquisitions, debt and equity investments, and capital raising initiatives. Prior to forming Harlan Capital Advisors, Mr. Harlan held numerous positions at U.S. Concrete, Inc. (NASDAQ: USCR), a publicly-traded producer of concrete, aggregates and related concrete products, including most recently as its President and Chief Executive Officer from May 2007 until August 2011, and as a Director from June 2006 until August 2011. He has previously served on the Board of Directors for several public and private companies and currently serves on the University of Houston Honors College Advisory Board. Prior to founding U.S. Concrete in August 1998, Mr. Harlan held several senior financial positions with publicly-traded companies, including chief financial officer, treasurer and controller. Mr. Harlan began his career with an international public accounting firm. Mr. Harlan is a Certified Public Accountant and graduated magna cum laude from the University of Mississippi with a Bachelor of Accounting degree.
We believe that Mr. Harlan’s qualifications to serve on our Board of Directors include his past experience on our Board of Directors, his substantial experience in the solid waste industry, his significant experience in accounting and financial matters, including his extensive experience as a certified public accountant, his substantial experience with growth-oriented companies, and his prior experience as a director of other publicly-traded companies.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 19
LARRY S. HUGHES | CORPORATE DIRECTOR | | | | | | Age 69
British Columbia, Canada
Director since:
May 2014
Independent
| | BOARD/COMMITTEE MEMBERSHIP: | BOARD & COMMITTEE ATTENDANCE IN 2020: 100% | | ■ | Board | | | ■ | Audit Committee | | | ■ | Executive Committee | | | | | COMMON SHARES OWNED OR CONTROLLED, INCLUDING DSUs: 18,439 | | | | | |
BIOGRAPHY:
Mr. Hughes is a retired executive and former lawyer who currently provides consulting and advisory services. In June 2017, Mr. Hughes retired as an executive of West Fraser Timber Co. Ltd. (TSX/NYSE: WFG), an integrated wood products company headquartered in Vancouver, B.C. in Canada. Mr. Hughes served as West Fraser’s Senior Vice- President from 2007 to 2011 with oversight of strategic planning, legal, environmental and safety matters. He served as Vice-President, Finance and Chief Financial Officer from 2011 to 2017 with oversight of financial and accounting matters as well as strategic planning, investor relations, corporate governance and pension matters. Prior to joining West Fraser Mr. Hughes had a successful 27-year career as a business lawyer in private practice in Vancouver. He served as a Director of Progressive Waste Solutions Ltd. from May 2014 until May 2016.(2)
We believe that Mr. Hughes’ qualifications to serve on our Board of Directors include his past experience on our Board of Directors, his significant experience in corporate financial, governance and legal matters, his experience with companies having operations in both the U.S. and Canada, and his experience as an officer of another publicly-traded company in Canada.
| | | | | WORTHING F. JACKMAN | PRESIDENT AND CHIEF EXECUTIVE OFFICER
Waste Connections, Inc.
| Age 56
Texas, U.S.A.
Director since:
July 2019
NOT Independent
| | BOARD/COMMITTEE MEMBERSHIP: | BOARD ATTENDANCE IN 2020: 100% | | ■ | Board | | | | | COMMON SHARES OWNED OR CONTROLLED: 122,906 | | | | | | | | | | | | | | | | |
BIOGRAPHY:
Worthing F. Jackman has been President and Chief Executive Officer of Waste Connections since July 2019. From July 2018 to that date, he served as President of Waste Connections. Mr. Jackman served as Executive Vice President and Chief Financial Officer of Waste Connections from September 2004 to July 2018. From April 2003 to September 2004, Mr. Jackman served as Vice President – Finance and Investor Relations of Waste Connections. Mr. Jackman held various investment banking positions with Alex. Brown & Sons, now Deutsche Bank Securities, Inc., from 1991 through 2003, including most recently as a Managing Director within the Global Industrial & Environmental Services Group. In that capacity, he provided capital markets and strategic advisory services to companies in a variety of sectors, including solid waste services. Mr. Jackman serves as a director for Quanta Services, Inc. He holds a B.S. degree in Finance from Syracuse University and an M.B.A. from the Harvard Business School.
We believe that Mr. Jackman’s qualifications to serve on our Board of Directors include his extensive experience in the solid waste industry, including his senior leadership roles within the Company since 2003 and as our President and Chief Executive Officer and a director since July 2019.
(2) | In 2016, Waste Connections, Inc., a Delaware corporation, entered into a business combination transaction with Progressive Waste Solutions Ltd., a corporation organized under the laws of Ontario, Canada (“Progressive Waste” and the transaction, the “Progressive Waste acquisition”). The public company that remained following the transaction is Waste Connections, Inc., a corporation organized under the laws of Ontario, Canada. References to the “Company” and “Waste Connections” refer to the Delaware corporation, Waste Connections, Inc. (now known as Waste Connections US, Inc.) before the Progressive Waste acquisition and the combined business thereafter. |
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 20
ELISE L. JORDAN | EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER | FedEx Express | | | | | Age 61
Tennessee, U.S.A.
Director since:
August 2019
Independent
| | BOARD/COMMITTEE MEMBERSHIP: | BOARD & COMMITTEE ATTENDANCE IN 2020: 100% | | ■ | Board | | | ■ | Audit Committee | | | ■ | Nominating and Corporate Governance Committee | | | | | COMMON SHARES OWNED OR CONTROLLED, INCLUDING DSUs: 2,801 | | | | | |
BIOGRAPHY:
Ms. Jordan is Executive Vice President and CFO of FedEx Express, the largest transportation company in the FedEx Corp. (NYSE: FDX) enterprise with $38 billion in annual revenues and over 235,000 team members worldwide. In that capacity, she is responsible for worldwide financial affairs, including financial planning, reporting and analysis, long-range strategic planning, and regional accounting and controls. Prior to her current position, Ms. Jordan served as Senior Vice President, Strategic and Financial Planning and Analysis and Business Systems; Vice President, FedEx Express Financial Planning; Managing Director, Global Financial Planning; and Manager, Corporate/Domestic Business Planning. She joined FedEx in 1983 as an Operations Analyst. Before joining FedEx, Ms. Jordan served as a Staff Auditor for Arthur Andersen LLC. Ms. Jordan earned her MBA from the University of Memphis and her BBA in Accounting from the University of Texas in Austin.
We believe that Ms. Jordan’s qualifications to serve on our Board of Directors include her significant experience in accounting, corporate finance, technology and governance, her senior positions within a multi-national logistics company, and her experience as an officer of another publicly-traded company.
SUSAN “SUE” LEE | CORPORATE DIRECTOR | | | | | | | Age 69
British Columbia, Canada
Director since:
May 2014
Independent
| | BOARD/COMMITTEE MEMBERSHIP: | BOARD & COMMITTEE ATTENDANCE IN 2020: 100% | | ■ | Board | | | ■ | Compensation Committee | | | | | COMMON SHARES OWNED OR CONTROLLED, INCLUDING DSUs: 16,345 | | | | |
BIOGRAPHY:
Ms. Lee has been a corporate director since November 2011. She retired from Suncor Energy Inc., an integrated energy company, in April 2012, where she last served as Senior Vice-President, Human Resources and Communications. During her 16 years with Suncor, her responsibilities included executive compensation and succession planning, governance, merger strategy and integration, and stakeholder and government relations. Prior to joining Suncor, Ms. Lee had a 14-year career in human resources at TransAlta Corp. Ms. Lee has been a Director of Empire Company Limited, a food retailing business, since 2014, where she also serves as a member of the Board of Directors’ Human Resources Committee. Ms. Lee served as a Director of Bonavista Energy Corporation from November 2013 to December 2017 and as a Director of Progressive Waste Solutions Ltd. from May 2014 until May 2016. She has also served on a number of prominent boards in Canada, such as the Suncor Energy Foundation, Holcim Canada, Altalink, the University of Calgary Board of Governors and the Women’s Executive Network Top 100 Women Advisory Board. In 2007, Ms. Lee was an inaugural inductee into the Hall of Fame for Canada’s Top 100 Most Powerful Women.
We believe that Ms. Lee’s qualifications to serve on our Board of Directors include her past experience on our Board of Directors, her substantial experience with human resources and talent management and development matters, her substantial experience in the energy industry, the positions she has held with other publicly-traded companies in Canada and her experience as a director of other publicly-traded companies in Canada.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 21
WILLIAM J. RAZZOUK | CORPORATE DIRECTOR | | Age 73
Florida, U.S.A.
Director since:
January 1998
Independent
| | BOARD/COMMITTEE MEMBERSHIP: | BOARD & COMMITTEE ATTENDANCE IN 2020: 100% | | ■ | Board | | | ■ | Audit Committee | | | ■ | Compensation Committee | | | | | COMMON SHARES OWNED OR CONTROLLED, INCLUDING DSUs: 18,010 | | | | | |
BIOGRAPHY:
Mr. Razzouk has been a corporate director since October 2017. From March 2005 to October 2017, Mr. Razzouk served as the Chairman and a Director of Newgistics, Inc., a provider of intelligent order delivery and returns management solutions for direct retailers and technology companies. From March 2005 to December 2015, he also served as the President and Chief Executive Officer of Newgistics, Inc. From August 2000 to December 2002, he was a Managing Director of Paradigm Capital Partners, LLC, a venture capital firm in Memphis, Tennessee focused on meeting the capital and advisory needs of emerging growth companies. From September 1998 to August 2000, he was Chairman of PlanetRx.com, an e-commerce company focused on healthcare and sales of prescription and over-the-counter medicines, health and beauty products and medical supplies. He was also Chief Executive Officer of PlanetRx.com from September 1998 until April 2000. From April 1998 until September 1998, Mr. Razzouk owned a management consulting business and an investment company that focused on identifying strategic acquisitions. From September 1997 until April 1998, he was the President, Chief Operating Officer and a Director of Storage USA, Inc., a then publicly-traded (now privately held) real estate investment trust that owned and operated more than 350 mini storage warehouses. He served as the President and Chief Operating Officer of America Online from February 1996 to June 1996. From 1983 to 1996, Mr. Razzouk held various management positions at Federal Express Corporation, most recently as Executive Vice President, Worldwide Customer Operations, with full worldwide P&L responsibility. Mr. Razzouk previously held management positions at ROLM Corporation, Philips Electronics and Xerox Corporation. He previously was a Director of Fritz Companies, Inc., Sanifill, Inc., Cordis Corp., Storage USA, PlanetRx.com, America Online and La Quinta Motor Inns. Mr. Razzouk holds a Bachelor of Journalism degree from the University of Georgia.
We believe that Mr. Razzouk’s qualifications to serve on our Board of Directors include his past experience on our Board of Directors, his significant experience in corporate financial matters, his experience in the solid waste industry, his substantial experience with growth-oriented companies, and his prior experience as a director of other publicly-traded companies.
Public Company Board Memberships
Under the terms of our Corporate Governance Guidelines and Board Charter, directors who also serve as chief executive officers or in equivalent positions at any company should not serve on more than two boards of public companies in addition to our Board of Directors, and other directors should not serve on more than four other boards of public companies in addition to our Board of Directors.
Additionally, our Audit Committee Charter specifies that directors may not simultaneously serve on the audit committees of more than two other public companies unless our Board of Directors first determines such service will not impair the ability of the director to serve effectively on our Audit Committee.
The table below sets forth the other reporting issuers for which the Company’s directors serve as directors and the stock exchanges on which such issuers are listed.
Nominee | Public Company | Exchange | Ronald J. Mittelstaedt | SkyWest, Inc. | NASDAQ | Michael W. Harlan | WiMi Hologram Cloud Inc. | NASDAQ | Worthing F. Jackman | Quanta Services, Inc. | NYSE | Susan “Sue” Lee | Empire Company Limited | TSX |
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 22
SHARE OWNERSHIP
Share Ownership of Five Percent Shareholders
The following table shows ownership information for any person or company known by our directors and executive officers to beneficially own, or control or direct, directly or indirectly, 5% or more of the Common Shares. This information is presented as of the Record Date for the Meeting.
| Name of Beneficial Owner | Number of Outstanding
Common Shares
Beneficially Owned(1) | Percent
of Class | | T. Rowe Price Associates, Inc.(2) | 28,255,228 | 10.7% | | The Vanguard Group(3) | 26,074,347 | 9.9% |
(1) | Beneficial ownership is determined in accordance with the rules of the SEC. In general, a person who has voting power and/or investment power with respect to securities is treated as the beneficial owner of those securities. Except as otherwise indicated by footnote, the Company believes that the persons named in this table have sole voting and investment power with respect to the Common Shares shown. | (2) | The share ownership of T. Rowe Price Associates, Inc. is based on a Schedule 13G/A filed with the SEC on February 10, 2021. T. Rowe Price Associates has sole voting power with respect to 8,516,509 Common Shares and sole dispositive power with respect to 28,255,228 Common Shares. The address of T. Rowe Price Associates, Inc. is 100 E. Pratt Street, Baltimore, Maryland 21202. | (3) | The share ownership of The Vanguard Group is based on a Schedule 13G/A filed with the SEC on February 10, 2021. The Vanguard Group has sole voting power with respect to zero Common Shares and sole dispositive power with respect to 24,843,174 Common Shares. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, Pennsylvania 19355. |
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 23
Share Ownership of the Board of Directors and Corporate Officers
The following table sets forth information known to the Company concerning Common Shares beneficially owned, as of March 16, 2021, the Record Date for the Meeting, by (i) each director of the Company; (ii) each named executive officer of the Company; and (iii) all corporate officers and directors of the Company as a group. These individuals, both individually and in the aggregate, own less than 1% of our outstanding Common Shares as of the Record Date for the Meeting.
| Beneficial Owner(1) | | Amount and
Nature of
Beneficial
Ownership(2) | | | Vested Restricted
Share Units
Held Under
Nonqualified
Deferred
Compensation
Plan(3) | | | Total | | | Ronald J. Mittelstaedt | | | 190,201 | (4) | | | 57,449 | | | | 247,650 | | | Worthing F. Jackman | | | 122,906 | | | | — | | | | 122,906 | | | Darrell W. Chambliss | | | 107,446 | | | | — | | | | 107,446 | | | Mary Anne Whitney | | | 47,308 | | | | — | | | | 47,308 | | | James M. Little | | | 37,252 | (5) | | | — | | | | 37,252 | | | Edward E. “Ned” Guillet | | | 32,342 | | | | — | | | | 32,342 | | | Patrick J. Shea | | | 27,620 | | | | — | | | | 27,620 | | | William J. Razzouk | | | 15,088 | | | | — | | | | 15,088 | | | Susan “Sue” Lee | | | 10,398 | | | | — | | | | 10,398 | | | Larry S. Hughes | | | 10,126 | | | | — | | | | 10,126 | | | Michael W. Harlan | | | 7,994 | | | | — | | | | 7,994 | | | Elise L. Jordan | | | 1,385 | | | | — | | | | 1,385 | | | ALL CORPORATE OFFICERS AND DIRECTORS AS A GROUP (27 PERSONS) | | | 843,173 | | | | 64,164 | | | | 907,337 | |
(1) | Beneficial ownership is determined in accordance with the rules of the SEC. In general, a person who has voting power and/or investment power with respect to securities is treated as the beneficial owner of those securities. Except as otherwise indicated by footnote, and subject to applicable community property laws, the Company believes that the beneficial owners of the Common Shares, based on information furnished by such owners, have sole investment power and voting power with respect to such shares. | (2) | Common Shares subject to share options and/or warrants currently exercisable or exercisable within 60 days after March 16, 2021, Common Shares into which convertible securities are convertible within 60 days after March 16, 2021, and Common Shares which will become issuable within 60 days after March 16, 2021, pursuant to outstanding RSUs count as outstanding for computing the percentage beneficially owned by the person holding such share options, warrants, convertible securities and RSUs, but are not deemed to be outstanding for the purpose of computing the percentage ownership of any other person. | (3) | Executive officers of the Company, in years prior to 2015, were able to voluntarily defer receipt of RSU grants under the Company’s Nonqualified Deferred Compensation Plan. The RSUs held under the Nonqualified Deferred Compensation Plan are not considered Common Shares that are beneficially owned for SEC disclosure purposes. The Company has included them in this table because they are similar to or track its Common Shares, they ultimately are settled in Common Shares, and they represent an investment risk in the performance of its Common Shares. | (4) | Includes 190,201 Common Shares held by Mittelstaedt Enterprises, L.P., of which Mr. Mittelstaedt is a limited partner. Excludes 5,286 Common Shares held by the Mittelstaedt Irrevocable Trust dated 6/18/97 and 44,002 Common Shares held by RDM Positive Impact Foundation as to which Mr. Mittelstaedt disclaims beneficial ownership. | (5) | Includes 11,692 Common Shares held by Mr. Little’s spouse. |
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 24
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
This Compensation Discussion and Analysis (“CD&A”) provides a detailed description of our executive compensation philosophy and objectives, the elements of our executive compensation program, the key executive compensation decisions made under those programs for 2020, and the factors considered in making those decisions. This CD&A is intended to provide additional context and background for the compensation earned by and awarded to our NEOs.
For 2020, our NEOs included the following individuals:
■ | Worthing F. Jackman, President and Chief Executive Officer; | ■ | Mary Anne Whitney, Executive Vice President and Chief Financial Officer; | ■ | Darrell W. Chambliss, Executive Vice President and Chief Operating Officer; | ■ | Patrick J. Shea, Executive Vice President, General Counsel and Secretary; and | ■ | James M. Little, Executive Vice President – Engineering and Disposal. |
Executive Summary
The Company’s executive compensation program is designed to align the interests of senior management with shareholders by tying a significant portion of their compensation to the Company’s annual operating and financial performance, as well as longer term shareholder returns. We believe that our pay-for-performance philosophy and the design of our executive compensation program strongly support an environment of continuous improvement and shareholder value creation.
As described in the section “Compensation Discussion and Analysis — Role of Independent Compensation Consultant; Comparator Group Compensation Data”, a review by the Compensation Committee’s independent compensation consultant in February 2020 concluded that, in aggregate, the Company’s targeted total direct compensation, or TDC, for our NEOs was aligned with the 25th percentiles of the Comparator Group. It was also noted that the Company’s annualized TSR was approximately at or above the 75th percentile for all measurement periods between three and ten year periods ending December 31, 2019, when compared to the Comparator Group.
As illustrated below, our TSR significantly outperformed the S&P 500, the TSX 60 and the DJ Waste Index for the five-year period ended December 31, 2020. In addition, in October 2020, we increased our regular quarterly cash dividend by 10.8% to $0.205 per share, the tenth consecutive year of double-digit growth in our cash dividend since its commencement in 2010.
WASTE CONNECTIONS, INC. | 2021 PROXY STATEMENT 25
Executive Compensation Program Best Practices
Our executive compensation program includes features that we believe drive performance and excludes features we believe do not serve our shareholders’ long-term interests. The table below highlights some of the “Best Practices” featured in our compensation program as well as the “Problematic Pay Practices” that we have excluded.
Pay for Performance | | Our NEOs receive the majority (approximately 82% for the CEO, and approximately 74% for other NEOs, in 2020) of their TDC in performance-based compensation, which is contingent on Company and individual performance. | Ratio of PSUs to total equity compensation at 50% | | Our NEOs receive 50% of their long-term equity compensation as PSUs, the payout on which is contingent upon Company performance over a multi-year period. | Relevant Performance Metrics | | Our annual incentive and equity-based compensation programs include performance metrics meant to drive long-term shareholder value creation. | Addition of ESG Metrics | | Incorporated ESG targets into equity-based compensation programs starting in 2021. | Recoupment Policy | | We maintain a clawback policy that permits our Board of Directors unanimously recommends that shareholders VOTE “FOR” the election of each of the eight nominees to seek the forfeiture or repaymentboard of certain incentive compensation paid to an NEO or other corporate officer in certain circumstances.directors. | |
2022Notice of Annual Meeting & Proxy Statement65
Annual Say on Pay | PROPOSAL 2:
NON-BINDING ADVISORY VOTE ON NAMED EXECUTIVE OFFICER COMPENSATION (“SAY-ON-PAY”) | We provide our shareholders with an annual opportunity to vote, on an |
What am I being asked to vote on? As required by Section 14A of the Exchange Act, we are requesting our shareholders to approve, on a non-binding, advisory basis, on the compensation of our NEOs.
|
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