CLEAN HARBORS, INC. (NYSE:CLH) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 5.02. Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensation
Arrangements of Certain Officers.
Amendment to Section 6(m) of the Companys 2014 CEO Incentive Plan
As described more fully in Item 5.07 of this report, the
shareholders of Clean Harbors, Inc. (the Company), at the Companys
annual meeting of shareholders held on June 7, 2017 (the 2017
Annual Meeting), approved an amendment to Section 6(m) of the Clean
Harbors, Inc. 2014 Annual CEO Incentive Plan (the CEO Incentive
Plan). The purposes of the Plan are to provide an incentive each
year for performance of the Companys Chief Executive Officer (CEO)
by making a significant percentage of the CEOs total cash
compensation dependent upon the level of his or the Companys
performance attained for the year, and to do so in a manner which
will allow full deductibility of the bonus portion of the CEO
compensation expense under Section 162(m) of the Internal Revenue
Code (the Code). Section 162(m) generally limits the Company’s
federal income tax deduction for total compensation paid to each of
certain executive officers, including the CEO, in any year to $1.0
million unless any excess over $1.0 million qualifies as
performance-based compensation as defined in Section 162(m).
shareholders of Clean Harbors, Inc. (the Company), at the Companys
annual meeting of shareholders held on June 7, 2017 (the 2017
Annual Meeting), approved an amendment to Section 6(m) of the Clean
Harbors, Inc. 2014 Annual CEO Incentive Plan (the CEO Incentive
Plan). The purposes of the Plan are to provide an incentive each
year for performance of the Companys Chief Executive Officer (CEO)
by making a significant percentage of the CEOs total cash
compensation dependent upon the level of his or the Companys
performance attained for the year, and to do so in a manner which
will allow full deductibility of the bonus portion of the CEO
compensation expense under Section 162(m) of the Internal Revenue
Code (the Code). Section 162(m) generally limits the Company’s
federal income tax deduction for total compensation paid to each of
certain executive officers, including the CEO, in any year to $1.0
million unless any excess over $1.0 million qualifies as
performance-based compensation as defined in Section 162(m).
Under the CEO Incentive Plan, the CEO’s potential annual incentive
bonus (not to exceed $3,000,000 for any one year) is calculated
based on the Company meeting certain Performance Criteria selected
by the Compensation Committee of the Companys Board of Directors
(the Committee) for each year the Plan is in effect. Under the Plan
as in effect prior to the amendment to Section 6(m), the
Performance Criteria could be based on one or more of the
following: the Company’s consolidated revenues, Adjusted EBITDA as
described in the Company’s credit agreement or reports then being
filed by the Company with the Securities and Exchange Commission),
ratio of Adjusted EBITDA to consolidated revenues (Adjusted EBITDA
Margin), earnings per share, return on the total assets (excluding
excess cash), return on long-term assets, return on invested
capital, return on shareholder equity, health, safety and
compliance statistics (HSC Compliance), cost reductions, days of
sales outstanding (DSO) (based upon the time of payment of the
Company’s outstanding billings), hiring of key executive officers,
succession planning, financing or refinancing results, or
implementation or expansion of a new line of business or programs.
The amendment to Section 6(m) of the CEO Incentive Plan added cash
flow from operations and Free Cash Flow (namely, cash flow from
operations (with certain adjustments), less capital expenditures
(net of disposals)) to the Performance Criteria from which the
Committee may select in determining potential cash bonuses for the
CEO under the Plan.
bonus (not to exceed $3,000,000 for any one year) is calculated
based on the Company meeting certain Performance Criteria selected
by the Compensation Committee of the Companys Board of Directors
(the Committee) for each year the Plan is in effect. Under the Plan
as in effect prior to the amendment to Section 6(m), the
Performance Criteria could be based on one or more of the
following: the Company’s consolidated revenues, Adjusted EBITDA as
described in the Company’s credit agreement or reports then being
filed by the Company with the Securities and Exchange Commission),
ratio of Adjusted EBITDA to consolidated revenues (Adjusted EBITDA
Margin), earnings per share, return on the total assets (excluding
excess cash), return on long-term assets, return on invested
capital, return on shareholder equity, health, safety and
compliance statistics (HSC Compliance), cost reductions, days of
sales outstanding (DSO) (based upon the time of payment of the
Company’s outstanding billings), hiring of key executive officers,
succession planning, financing or refinancing results, or
implementation or expansion of a new line of business or programs.
The amendment to Section 6(m) of the CEO Incentive Plan added cash
flow from operations and Free Cash Flow (namely, cash flow from
operations (with certain adjustments), less capital expenditures
(net of disposals)) to the Performance Criteria from which the
Committee may select in determining potential cash bonuses for the
CEO under the Plan.
A copy of the amendment to Section 6(m) of the CEO Incentive Plan
is attached as Appendix A to the Companys proxy statement for the
2017 Annual Meeting, as filed with the Securities and Exchange
Commission on April 26, 2017 (the 2017 Proxy Statement), and the
amendment is further described in the 2017 Proxy Statement under
the heading Approval of Amendment to Section 6(m) of 2014 CEO
Annual Incentive Plan commencing on page 32. That copy of the
amendment and such description are incorporated herein by
reference.
is attached as Appendix A to the Companys proxy statement for the
2017 Annual Meeting, as filed with the Securities and Exchange
Commission on April 26, 2017 (the 2017 Proxy Statement), and the
amendment is further described in the 2017 Proxy Statement under
the heading Approval of Amendment to Section 6(m) of 2014 CEO
Annual Incentive Plan commencing on page 32. That copy of the
amendment and such description are incorporated herein by
reference.
Amendment and Restatement of Management Incentive Plan
As described more fully in Item 5.07 of this report, the Companys
shareholders approved at the 2017 Annual Meeting the Companys
Management Incentive Plan, as amended and restated effective
January 1, 2017 (the Amended and Restated MIP). The Companys 2017
Proxy Statement, under the heading Approval of the Companys Amended
and Restated Management Incentive Plan commencing on page 35,
describes the Amended and Restated MIP and a copy of the Amended
and Restated MIP is attached as Appendix B to the 2017 Proxy
Statement. Such description and copy are incorporated herein by
reference.
shareholders approved at the 2017 Annual Meeting the Companys
Management Incentive Plan, as amended and restated effective
January 1, 2017 (the Amended and Restated MIP). The Companys 2017
Proxy Statement, under the heading Approval of the Companys Amended
and Restated Management Incentive Plan commencing on page 35,
describes the Amended and Restated MIP and a copy of the Amended
and Restated MIP is attached as Appendix B to the 2017 Proxy
Statement. Such description and copy are incorporated herein by
reference.
The Amended and Restated MIP succeeds the Companys Management
Incentive Plan, as previously approved by the Companys shareholders
on May 7, 2012 (the Previous MIP). Except for one change in the
performance criteria which is described in the section of the
Companys 2017 Proxy Statement referenced above, the provisions of
the Amended and Restated MIP are substantially the same as those of
the Previous MIP.
Incentive Plan, as previously approved by the Companys shareholders
on May 7, 2012 (the Previous MIP). Except for one change in the
performance criteria which is described in the section of the
Companys 2017 Proxy Statement referenced above, the provisions of
the Amended and Restated MIP are substantially the same as those of
the Previous MIP.
As described above, Section 162(m) of the Code generally limits
the Companys ability to deduct for federal income tax purposes
any amount of the total compensation paid to each of the Companys
covered employees in any year in excess of $1.0 million unless
such excess qualifies as performance-based compensation as
defined in Section 162(m). Section 162(m) defines covered
employees to include the CEO and the next three highest paid
executives (other than the chief financial officer) in the most
recently completed fiscal year. Both the Previous MIP and the
Amended and Restated MIP provide for potential cash bonuses for
certain executives and other senior managers of the Company and
its subsidiaries, which may include the Companys covered
employees other than the CEO. Neither the Previous MIP nor the
Amended and Restated MIP provides for any bonuses for the
Companys CEO, but rather potential cash bonuses for the CEO are
subject to the Companys separate CEO Incentive Plan which was
approved by the Companys shareholders at the 2009 annual meeting
and subsequently amended, including through the amendment to
Section 6(m) thereof approved by the shareholders at the 2017
Annual Meeting as described above.
the Companys ability to deduct for federal income tax purposes
any amount of the total compensation paid to each of the Companys
covered employees in any year in excess of $1.0 million unless
such excess qualifies as performance-based compensation as
defined in Section 162(m). Section 162(m) defines covered
employees to include the CEO and the next three highest paid
executives (other than the chief financial officer) in the most
recently completed fiscal year. Both the Previous MIP and the
Amended and Restated MIP provide for potential cash bonuses for
certain executives and other senior managers of the Company and
its subsidiaries, which may include the Companys covered
employees other than the CEO. Neither the Previous MIP nor the
Amended and Restated MIP provides for any bonuses for the
Companys CEO, but rather potential cash bonuses for the CEO are
subject to the Companys separate CEO Incentive Plan which was
approved by the Companys shareholders at the 2009 annual meeting
and subsequently amended, including through the amendment to
Section 6(m) thereof approved by the shareholders at the 2017
Annual Meeting as described above.
Section 162(m) of the Code requires, among other matters, that
the material terms of the performance goals under which bonuses
can be paid under the MIP be disclosed to and approved by the
Companys shareholders at least once every five years. Shareholder
approval of the Amended and Restated MIP at the 2017 Annual
Meeting is intended to constitute approval of those provisions
for purposes of Section 162(m).
the material terms of the performance goals under which bonuses
can be paid under the MIP be disclosed to and approved by the
Companys shareholders at least once every five years. Shareholder
approval of the Amended and Restated MIP at the 2017 Annual
Meeting is intended to constitute approval of those provisions
for purposes of Section 162(m).
Item 5.07. Submission of Matters to a Vote of Security Holders.
The Company held its annual meeting of shareholders on Wednesday,
June 7, 2017, at which the following matters were submitted to a
vote of the shareholders. Each of the matters was described in
the Companys 2017 Proxy Statement. The votes as to each such
matter were as follows:
June 7, 2017, at which the following matters were submitted to a
vote of the shareholders. Each of the matters was described in
the Companys 2017 Proxy Statement. The votes as to each such
matter were as follows:
(1) Votes regarding the election of the persons named below as
Class I directors for a term expiring in 2020:
Class I directors for a term expiring in 2020:
|
For
|
Withheld
|
Broker Non-Votes
|
||||
|
Eugene Banucci
|
49,062,522
|
291,385
|
1,740,712
|
|||
|
Edward G. Galante
|
48,665,373
|
688,534
|
1,740,712
|
|||
|
Thomas J. Shields
|
48,854,572
|
499,335
|
1,740,712
|
|||
|
John R. Welch
|
45,038,807
|
4,315,100
|
1,740,712
|
(2) Advisory vote on executive compensation.
|
For
|
Against
|
Abstain
|
Broker Non-Votes
|
|||
|
48,684,505
|
636,256
|
33,146
|
1,740,712
|
(3) Advisory vote on frequency of shareholder votes on executive
compensation.
compensation.
|
1 Year
|
2 Years
|
3 Years
|
Abstain
|
Broker Non-Votes
|
||||
|
43,855,701
|
15,710
|
5,475,951
|
6,545
|
1,740,712
|
(4) Vote to approve an amendment to Section 6(m) of the
Companys 2014 CEO Annual Incentive Plan.
Companys 2014 CEO Annual Incentive Plan.
|
For
|
Against
|
Abstain
|
Broker Non-Votes
|
|||
|
48,982,386
|
357,520
|
14,001
|
1,740,712
|
(5) Vote to approve the Companys Amended and Restated
Management Incentive Plan.
Management Incentive Plan.
|
For
|
Against
|
Abstain
|
Broker Non-Votes
|
|||
|
48,983,887
|
356,085
|
13,935
|
1,740,712
|
(6) Vote to ratify the selection by the Audit Committee of the
Companys Board of Directors of Deloitte Touche LLP as the
Companys independent registered public accounting firm for the
current fiscal year.
Companys Board of Directors of Deloitte Touche LLP as the
Companys independent registered public accounting firm for the
current fiscal year.
|
For
|
Against
|
Abstain
|
Broker Non-Votes
|
|||
|
50,913,071
|
176,019
|
5,529
|
-0-
|
>Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
|
Description
|
Location
|
||
|
10.52C
|
Clean Harbors, Inc. Management Incentive Plan [As
Amended and Restated Effective January 1, 2017] |
Incorporated by reference to Appendix B to the
Companys definitive proxy statement for its 2017 annual meeting of shareholders filed on April 26, 2017 |
|
|
10.55B
|
Clean Harbors, Inc. Amendment to Section 6(m) of 2014
Annual CEO Incentive Plan |
Incorporated by reference to Appendix A to the
Companys definitive proxy statement for its 2017 annual meeting of shareholders filed on April 26, 2017 |
About CLEAN HARBORS, INC. (NYSE:CLH)
Clean Harbors, Inc. is a provider of environmental, energy and industrial services. The Company operates in six segments: Technical Services; Industrial and Field Services; Kleen Performance Products; SK Environmental Services; Lodging Services, and Oil and Gas Field Services. Its Technical Services segment involves the collection, transportation, treatment and disposal of hazardous and non-hazardous wastes. Its Industrial services segment offers industrial maintenance services and industrial services. Its Kleen Performance Products segment processes used oil to convert into a range of products. SK Environmental Services segment offers environmental services and complementary products. Lodging Services consists of four lines of businesses: Lodge Operations, Mobile Camp Operations, Hospitality Operations and Manufacturing. Oil and Gas Field Services segment provides fluid handling, fluid hauling, production servicing, surface rentals, seismic services and directional boring services.
