Stockholders' Equity

6 Months Ended

Jun. 30, 2014

Stockholders' Equity [Abstract]

Stockholders' Equity

13.STOCKHOLDERS' EQUITY

Stock-Based Compensation

Adoption of 2014 Incentive Award Plan

On May 16, 2014 at the annual meeting of stockholders, the Company’s stockholders approved the Waste Connections, Inc. 2014 Incentive Award Plan (the “2014 Plan”), which had previously been adopted by the Company’s board of directors (the “Board”), subject to stockholder approval. Upon such stockholder approval, the 2014 Plan became effective, replacing the Waste Connections, Inc. Third Amended and Restated 2004 Equity Incentive Plan, pursuant to which no more awards may be granted. 

The 2014 Plan authorizes the Compensation Committee of the Board (the “Compensation Committee”) to grant nonqualified stock options, warrants, restricted stock, restricted stock units, dividend equivalents and stock payment awards. The 2014 Plan also authorizes the Compensation Committee to grant performance awards payable in the form of the Company’s common stock or cash, including equity awards and incentive cash bonuses that are intended to qualify as “performance-based compensation” under Section 162(m) of the Internal Revenue Code of 1986, as amended (“Section 162(m)”). The 2014 Plan authorizes the grant of awards to employees and consultants of the Company and its subsidiaries and non-employee directors. 

Restricted Stock Units

A summary of activity related to restricted stock units under the Third Amended and Restated 2004 Equity Incentive Plan during the six month period ended June 30, 2014, is presented below: 

	Unvested Shares
Outstanding at December 31, 2013	1,299,466
Granted	491,405
Forfeited	(20,564)
Vested and Issued	(486,921)
Vested and Unissued	(70,422)
Outstanding at June 30, 2014	1,212,964

The weighted average grant-date fair value per share for the shares of common stock underlying the restricted stock units granted during the six month period ended June 30, 2014 was $42.41. 

Performance-Based Restricted Stock Units

The 2014 Plan allows for the issuance of performance-based restricted stock units (“PBRSUs”), among other types of awards.  The vesting of the PBRSUs is dependent on the Company’s performance against pre-established performance targets.  The PBRSUs are payable in shares of common stock after the end of a three-year performance period, when the Company’s financial performance for the entire performance period is determined.  At the end of the performance period, the number of shares awarded can range from 0% to 150% of the original granted amount, depending on the performance against the pre-established targets.

A summary of activity related to PBRSU’s during the six month period ended June 30, 2014, is presented below: 

	Unvested Shares
Outstanding at December 31, 2013	-
Granted	54,723
Forfeited	-
Vested	-
Outstanding at June 30, 2014	54,723

The weighted average grant-date fair value per share for the shares of common stock underlying the PBRSUs granted during the six month period ended June 30, 2014 was $42.33.  The Compensation Committee will determine the achievement of performance results and corresponding vesting of PBRSUs for each three-year performance period. The three-year performance period for the PBRSU’s granted during the six month period ended June 30, 2014 ends on December 31, 2016. 

PBRSUs have no voting rights.  PBRSUs are payable to an employee (or his beneficiary), subject to pro-rata vesting, upon death, disability, involuntary termination other than for cause, and voluntary termination for good reason in cases where an underlying employment agreement provides for such rights, and are subject to forfeiture in the event of other voluntary or for-cause termination. PBRSUs may also become payable to an employee pursuant to certain change in control provisions depending on whether the PBRSUs are assumed by the acquirer immediately following the change in control.

Compensation expense associated with outstanding PBRSUs is measured using the fair value of the Company’s common stock and is based on its estimated achievement of the established performance criteria at the end of each reporting period until the performance period ends, recognized ratably over the performance period. Compensation expense is only recognized for those awards that the Company expects to vest, which it estimates based upon an assessment of the probability that the performance criteria will be achieved.  The Company assumed a forfeiture rate of 0%.  

Deferred Restricted Stock Units

Certain recipients of the Company’s restricted stock unit awards (“RSUs”) who participate in the Company’s Nonqualified Deferred Compensation Plan may elect to defer some or all of their RSUs as they vest until a specified date or dates they choose.  At the end of the deferral periods, the Company issues to recipients who deferred their RSUs shares of the Company’s common stock underlying the deferred RSUs.  At June 30, 2014 and 2013, the Company had 223,752 and163,995 vested deferred RSUs outstanding, respectively.

Share Repurchase Program

The Company’s Board of Directors has authorized a common stock repurchase program for the repurchase of up to $1,200,000 of common stock through December 31, 2014.  Under the program, stock repurchases may be made in the open market or in privately negotiated transactions from time to time at management’s discretion.  The timing and amounts of any repurchases will depend on many factors, including the Company’s capital structure, the market price of the common stock and overall market conditions.  During the six months ended June 30, 2014 and 2013, the Company did not repurchase any shares of its common stock.  As of June 30, 2014, the remaining maximum dollar value of shares available for repurchase under the program was approximately $415,960.  The Company’s policy related to repurchases of its common stock is to charge any excess of cost over par value entirely to additional paid-in capital. 

Cash Dividend

In October 2013, the Company announced that its Board of Directors increased its regular quarterly cash dividend by $0.015, from $0.10 to $0.115 per share.  Cash dividends of $28,496 and $24,654 were paid during the six months ended June 30, 2014 and 2013, respectively.