WESTERN WASTE INDUSTRIES
21061 South Western Avenue
Torrance, California 90501
TO OUR SHAREHOLDERS:
You are cordially invited to attend the Annual Meeting of Shareholders
that will be held at The Portofino Hotel, 260 Portofino Way, Redondo Beach,
California 90277 on Friday, January 27, 1995, at 11:00 a.m. Pacific
Standard Time. A formal notice setting forth the business to come before
the meeting and a proxy statement are attached.
In order that your shares may be represented, please sign and return
the enclosed proxy form. If you do attend the meeting, you may withdraw
your proxy and vote in person, if you wish.
Shareholders of record at the close of business on December 14, 1994,
will be entitled to vote at the meeting. A copy of the annual report for
the fiscal year ended June 30, 1994, is being delivered to each shareholder
of the Company concurrently with the enclosed proxy material.
KOSTI SHIRVANIAN
President and
Chairman of the Board
<PAGE>
WESTERN WASTE INDUSTRIES
21061 South Western Avenue
Torrance, California 90501
TO THE SHAREHOLDERS OF WESTERN WASTE INDUSTRIES:
The Annual Meeting of Western Waste Industries will be held at
11:00 a.m., Pacific Standard Time, on Friday, January 27, 1995. The
meeting will be held at The Portofino Hotel, 260 Portofino Way, Redondo
Beach, California 90277.
The meeting will be held for the following purposes:
1. To approve an amendment to the Bylaws to permit the Board of
Directors to determine the specific number of directors within a range of
five to nine;
2. To elect three Directors;
3. To approve amendments to the 1992 Stock Option Plan;
4. To ratify the appointment of Ernst & Young LLP as independent
auditors for the fiscal year ending June 30, 1995; and
5. To transact such other business as may properly come before the
meeting and any adjournment thereof.
The Shareholders of record at the close of business on December 14,
1995, will be entitled to vote at the Annual Meeting.
By Order of the Board of Directors
SAVEY TUFENKIAN
DATED: December 21, 1994
SO THAT YOUR STOCK WILL BE REPRESENTED AT THE MEETING IN THE EVENT YOU ARE
NOT PERSONALLY PRESENT, PLEASE DATE, SIGN AND RETURN PROMPTLY THE ENCLOSED
PROXY IN THE ENVELOPE PROVIDED. EXECUTION OF THE PROXY WILL NOT AFFECT
YOUR RIGHT TO VOTE IN PERSON IF YOU ARE PRESENT AT THE MEETING.
-2- <PAGE>
WESTERN WASTE INDUSTRIES
---------------
PROXY STATEMENT
---------------
SOLICITATION
This Proxy Statement is furnished in connection with the solicitation
of the enclosed proxy by the Board of Directors of Western Waste Industries
(the "Company") for use at the Annual Meeting of Shareholders of the
Company to be held on Friday, January 27, 1995, and any adjournment of such
meeting. The Proxy Statement and the enclosed form of proxy are first
being sent or furnished to shareholders on or about December 21, 1994. The
cost of solicitation, including reasonable expenses of brokers and others
for forwarding proxy materials to beneficial owners of shares, will be paid
by the Company. Solicitation will be made primarily by mail, and may also
be made by telephone or telegraph by officers or by regular employees of
the Company. The mailing address of the executive offices of the Company
is 21061 South Western Avenue, Torrance, California 90501.
Any shareholder executing a proxy has the power to revoke it at any
time before it is voted by filing with the Secretary of the Company either
a written notice of revocation or a duly executed proxy bearing a later
date. Proxies may also be revoked by any shareholder present at the
meeting who elects to vote his or her shares in person. Subject to such
revocation, all proxies which are properly signed and returned to the
Company in time will be voted in accordance with the specifications so
made.
The Board of Directors has fixed December 14, 1994, as the record date
for determination of shareholders entitled to notice of and to vote at the
meeting and any adjournment thereof. As of December 14, 1994, the Company
had 14,363,633 shares of Common Stock outstanding, each of which is
entitled to one vote on all matters. Cumulative voting is not permitted for
the election of directors. Shareholders representing a majority of out-
standing Common Stock must be present in person or by proxy to constitute a
quorum at the Annual Meeting.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The following table sets forth information concerning the shareholders
known to the Company to have owned beneficially more than five percent of
the Company's outstanding Common Stock as of December 14, 1994. Common
Stock is the Company's only voting security.
-3- <PAGE>
Percent of
Name and Address of Number of Shares Common Stock
Beneficial Owner Beneficially Owned Outstanding
------------------- ------------------ ------------
Kosti Shirvanian.............. 5,842,472<F1><F2> 37.6%
21061 South Western Avenue
Torrance, California
90501<F3>
FMR Corporation............... 1,690,780<F4> 11.8%
82 Devonshire Street
Boston, Massachusetts 02109
State of Wisconsin Investment
Board....................... 1,310,800<F5> 9.1%
P.O. Box 7842
Madison, Wisconsin 53707
[FN]
<F1> These shares are the community property of Mr. Shirvanian and his
wife. Under California community property laws, each spouse has
management and control over community property, although it is
expected that Mrs. Shirvanian would act in concert with
Mr. Shirvanian.
<F2> Includes options to purchase 1,177,994 shares of the Company's Common
Stock, exercisable within 60 days.
<F3> Mr. Shirvanian is Chairman of the Board and President of the Company.
<F4> Based upon Schedule 13G filed with the Securities and Exchange
Commission on August 9, 1994.
<F5> Based upon Form 13F filed with the Securities and Exchange Commission
on June 30, 1994.
To the knowledge of management, no other person owns beneficially as
much as 5% of the outstanding stock of the Company. The tabulation under
"Security Ownership of Management" indicates the number of shares owned
beneficially by each nominee as of the record date.
-4- <PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth as of December 14, 1994, the amount of
the Company's Common Stock beneficially owned by each of its directors,
each executive officer named in the Summary Compensation Table and all
directors and executive officers as a group based on information obtained
from such persons.
Amount and Nature of Beneficial Ownership
-----------------------------------------
Sole Options Other Per-
Voting and Exer- Bene- centage
Invest- cisable ficial of
ment Within Owner- Common
Power 60 Days ship<F1> Total Stock
------- ------- ------ ------ -----
Harry S. Derbyshire... 27,000 49,000 -0- 76,000 <F*>
Ramsey DiLibero....... 1,000 8,000 -0- 9,000 <F*>
Richard A. Haft, Jr... 1,000 27,500 1,200 29,700 <F*>
Lawrence F. McQuaide.. 9,400 33,000 1,146 43,546 <F*>
Dr. A.N. Mosich....... 18,000 26,000 -0- 44,000 <F*>
Kosti Shirvanian...... 4,632,100<F2> 1,177,994 32,378 5,842,472 37.6%
John W. Simmons....... 7,000 50,000 -0- 57,000 <F*>
Savey Tufenkian....... 243,500 276,833 18,386 538,719<F3> 3.7%
All Executive
Officers and
Directors as a
Group (8 Persons)... - - - 6,640,437 41.5%
[FN]
<F*> Percentage of Common Stock owned does not exceed 1%.
<F1> Includes shares allocated to the Executive Officer through participa-
tion in the Company's 401(k) Savings and Investment Plan (the "401(k)
Plan"), according to the latest statement for the 401(k) Plan.
<F2> Shares held by a trust over which Mr. Shirvanian and his wife share
voting and investment power.
<F3> Includes 22,768 shares, an option to purchase 46,000 shares
exercisable within 60 days and 2,768 shares in the 401(k) Plan owned
by Ralph Tufenkian, a vice president of the Company and
Mrs. Tufenkian's husband. Mr. and Mrs. Tufenkian share voting and
investment power.
-5- <PAGE>
PROPOSAL 1 - APPROVAL OF AMENDMENT
TO THE BYLAWS OF THE COMPANY
TO PERMIT THE BOARD OF DIRECTORS TO
DETERMINE THE SPECIFIC NUMBER OF DIRECTORS
WITHIN A RANGE OF FIVE TO NINE
Section 2(a) of Article II of the Bylaws of the Company provides as
follows:
"(a) The number of directors shall be nine (9), until
changed by amendment to the Articles of Incorporation
or by an amendment to this Section 2 of Article II of
these Bylaws, adopted by vote or written assent of
shareholders entitled to exercise the majority of the
voting power of the corporation"
The requirement that any change in the number of directors be approved
by the shareholders of the Company is unnecessarily restrictive and
potentially detrimental to the Company in that upon the addition of a new
director or directors or the resignation of a director or directors, the
fixed number of directors may be changed to reflect the actual size of the
board only upon the approval of the shareholders, a time consuming and
expensive process for a corporation whose stock is publicly held.
Section 212(a) of the California Corporations Code provides for the
establishment of a so-called "flexible board", whereby the bylaws may
provide for a maximum number of directors and a minimum number of directors
and that the Board of Directors may then adjust the number of directors
within the established limits. Section 212(a) states that the articles or
bylaws may provide as follows:
"[T]hat the number of directors shall be not less than
a stated minimum nor more than a stated maximum (which
in no case shall be greater than two times the stated
minimum minus one), with the exact number of directors
to be fixed, within the limits specified, by approval
of the board or the shareholders (Section 153) in the
manner provided in the bylaws . . . ."
The Board of Directors of the Company currently consists of six
directors. At a meeting held on November 9, 1994, the directors
unanimously approved an amendment to the Bylaws providing for a maximum of
nine directors and a minimum of five directors with the exact number of
directors to be fixed within such limits by a bylaw or amendment thereof
adopted by the shareholders or by the Board of Directors of the Company.
The Board of Directors directed that the proposed amendment of the Bylaws
be submitted for shareholder approval at the Annual Meeting of
Shareholders. The amendment will become effective upon the affirmative
vote of a majority of the shares of Common Stock voting at the Annual
Meeting. A copy of the proposed amendment of the Bylaws of the Company is
attached as Appendix "A" to this proxy statement.
-6- <PAGE>
The Board of Directors of the Company recommends a vote FOR the
proposal to approve the amendment to the Bylaws to provide for a "flexible
board". Proxies received by the Board of Directors will be so voted unless
shareholders specify a contrary choice.
PROPOSAL 2 - NOMINATION AND ELECTION OF DIRECTORS
The Board of Directors of the Company currently consists of six
members, who are equally divided into two classes. Directors are elected
for terms of two years. At the Annual Meeting, the term of office of the
Class II directors will expire and three directors will be elected to serve
for a term of two years and until their respective successors are elected.
The Board intends to cause the nomination of the three persons named
below for election as directors. The directors will be elected by the
holders of the Common Stock. The persons named as proxy holders in the
accompanying form of proxy have advised the Company that they intend at the
Annual Meeting to vote the shares covered by proxies held by them for the
election of the nominees named below. If any or all of the nominees should
for any reason become unable to serve or for good cause will not serve, the
persons named in the accompanying form of proxy may vote for the election
of such substitute nominees, and for such lawful term or terms, as the
Board may propose. The accompanying form of proxy contains a discretionary
grant of authority with respect to this matter. The Board of Directors has
no reason to believe the nominees named, or any of them, will be unable to
serve if elected.
All the nominees were elected members of the Board of Directors by the
shareholders at the 1992 annual meeting of shareholders. No arrangement or
understanding exists between any of the nominees and any other person or
persons pursuant to which any nominee was or is to be selected as a
director or nominee.
The names of the nominees for Class II director and the Class I
directors who will continue in office after the Annual Meeting until the
expiration of their respective terms, together with certain information
regarding them, are as follows:
NOMINEES AND THE BOARD OF DIRECTORS
The following persons have been nominated to serve as Directors for
the ensuing two years.
-7- <PAGE>
<TABLE>
<CAPTION>
First
Year Principal
Became Term Occupation
Name (Age) Director Expires or Employment
- --------------- ------- ------- -----------------
NOMINEES FOR CLASS II DIRECTOR
<S> <C> <C> <C>
Harry S.
Derbyshire(69) 1983 1996<F*> Since January 1987, Chairman of the Board of J.C. Carter
Company, Inc., a manufacturer of aerospace products. Prior
to his retirement in 1985, Mr. Derbyshire was an Executive
Vice President of Whittaker Corporation. He also serves
as a Director of Electronic Memories and Magnetics
Corporation, a computer products manufacturer and National
Technical Systems, Inc., an operator of high technology
testing laboratories.
Dr. A.N. Mosich 1980<F1> 1996<F*> Professor of Accounting, University of Southern California
(66) until his retirement in 1993. Dr. Mosich is also an
author, consultant and lecturer.
Kosti Shirvanian 1964 1996<F*> Chairman of the Board of Directors and President since the
(64)<F2> Company's incorporation in 1964.
DIRECTORS CONTINUING IN OFFICE
CLASS I DIRECTORS
Ramsey G. DiLibero 1993 1995 Chief Operating Officer of the Company since December 1993.
(66) Vice Chairman of Browning Ferris International from 1988
until he retired in August 1989. He was the President,
Chief Operating Officer and Director for CECOS
International, Inc., a wholly owned hazardous waste
subsidiary of Browning Ferris Industries, Inc. from 1985
to 1988. Mr. DiLibero is a member of the Board of
Directors of United National Bank in Chambersburg,
Pennsylvania.
John W. Simmons 1983 1995 Business Consultant to various businesses. Director of
(76) Jacobs Engineering Group, an engineering and construction
firm and U.G.I. Corporation, a Company engaged in the
operation and the distribution of propane.
Savey Tufenkian 1964 1995 Executive Vice President since 1988 and Secretary
(65)<F2> Treasurer of the Company since its incorporation in 1964.
</TABLE>
-8- <PAGE>
[FN]
<F*> If elected at annual meeting
<F1> Dr. Mosich served as a director of the Company from 1980 to 1983, when
he resigned due to the time constraints of personal business. He was
re-elected a director in September 1984.
<F2> Kosti Shirvanian and Savey Tufenkian are brother and sister.
Mr. Kosti Shirvanian, who owns beneficially 37.6% of the outstanding
shares of the Common Stock of the Company, intends to vote for each of the
nominees for director.
BOARD OF DIRECTORS AND STANDING COMMITTEES
The Board of Directors is responsible for the overall affairs of the
Company. Regular meetings of the Board are to be held five times each year,
normally in February, May, July, September and November. During the fiscal
year ended June 30, 1994, the Board held a total of 14 meetings. No
incumbent director attended fewer than 75% of the aggregate of (i) the
Board meetings held during the period he or she was a director and (ii) the
meetings held by all committees of the Board on which he or she served
during the periods he or she served.
The Board of Directors presently maintains four standing committees:
Management Committee, Audit Committee, Compensation Committee and
Nominating Committee, which are described below. Members of these
committees are elected annually at the regular Board of Directors meeting
immediately following the Annual Meeting.
MANAGEMENT COMMITTEE - The Management Committee is presently comprised
of Mrs. Tufenkian and Messrs. Shirvanian, DiLibero, Simmons and Dr. Mosich.
The Management Committee may function on behalf of the entire Board (except
with respect to certain specified actions as provided in Section 311 of the
California Corporations Code) so long as the following conditions are met:
(i) the entire Board is unable to meet and a decision on an issue is
required; and (ii) at least one of the non-employee Board members,
Mr. Simmons or Dr. Mosich, must concur in the decision.
AUDIT COMMITTEE - The Audit Committee presently is comprised of
Mr. Simmons and Dr. Mosich. The Audit Committee meets twice each fiscal
year. The meetings are scheduled to coincide with the commencement and the
completion of the annual audit by the Company's independent auditors. The
principal responsibilities of and functions generally performed by the
Audit Committee are as follows: (i) recommendation of the accounting firm
to be employed by the Company as its independent auditors; (ii) consulta-
tion with the Company's independent auditors with regard to the audit plan;
(iii) review of the Company's financial statements with the independent
auditors prior to publication; (iv) determination that no restrictions are
placed by management on the scope or implementation of the independent
auditors' examination of the Company; and (v) consultation with the
-9- <PAGE>
independent auditors with respect to the adequacy of internal accounting
controls.
COMPENSATION COMMITTEE - The Compensation Committee presently is
comprised of Dr. Mosich and Mr. Simmons. The Compensation Committee holds
one regular meeting annually and any additional meetings as required for
the purpose of reviewing and determining the compensation of all officers
and employee-directors, granting stock options and approving the salary
philosophy for all other employees.
NOMINATING COMMITTEE - The Nominating Committee presently is comprised
of Mrs. Tufenkian and Messrs. Shirvanian and Derbyshire. The Nominating
Committee meets once each year, at least 90 days prior to the Annual
Meeting, for the purpose of nominating and recommending the selection of
individuals to comprise management's slate of nominees for the class of
directors to be elected for the ensuing year.
The Nominating Committee will consider qualified nominees recommended
by shareholders. Such recommendations should be sent no later than
August 10th each year to the Nominating Committee, c/o Corporate Secretary,
Western Waste Industries, 21061 South Western Avenue, Torrance, California
90501.
Non-employee directors receive fees of $10,000 per annum plus $1,000
per Board meeting attended in person, in addition to expenses reasonably
incurred in attending meetings. During fiscal 1994, the Company also paid
consulting fees to Mr. Derbyshire in the amount of $4,000. As discussed in
Proposal 3 below, the Board of Directors has adopted an amendment to the
Western Waste Industries 1992 Stock Option Plan (the "Plan") which provides
that each nonemployee director shall receive annually on a prescribed date
options to purchase 10,000 shares of Common Stock at an exercise price
equal to the closing price of the Company's Common Stock on the date of
grant as reported on the New York Stock Exchange.
PROPOSAL 3 - APPROVAL OF AMENDMENTS
TO 1992 STOCK OPTION PLAN
At the annual meeting of shareholders held on December 18, 1992, the
shareholders approved the Western Waste Industries 1992 Stock Option Plan
(the "1992 Plan"). On July 6, 1994, the Board of Directors of the Company
unanimously approved certain amendments to the 1992 Plan (the
"Amendments"). The Board of Directors directed that the Amendments be
submitted for shareholder approval at the Annual Meeting. The Amendments
will become effective upon the affirmative vote of a majority of the shares
of Common Stock voting at the Annual Meeting.
The purpose of the Amendments is two-fold. The first purpose is to
bring the 1992 Plan into compliance with the requirements of Section 162(m)
of the Internal Revenue Code of 1986, as amended (the "Code"), so that the
compensation expense resulting from grants of stock options under the 1992
Plan to certain executive officers whose compensation exceeds $1 million
may be deductible by the Company for federal income tax purposes (see
-10- <PAGE>
"Section 162(m)" discussed on page [8/14] of this Proxy Statement). The
affected executive officers are described in Code Section 162(m), and they
may from time to time be participants under the 1992 Plan (collectively,
the "Section 162(m) Participants"). The executive officers named in the
Summary Compensation Table may become Section 162(m) Participants for a
Plan Year.
The second purpose of the Amendments is to amend the 1992 Plan so as
to qualify the 1992 Plan as a "formula plan") under Rule 16b-3(c)(2)(ii)(A)
promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended. More specifically, the Amendments are
intended to allow participation by a non-employee director in a formula
plan without jeopardizing the director's status as a "disinterested person"
for the purpose of administering the 1992 Plan and other plans under
Rule 16b-3.
A brief description of the 1992 Plan is provided below. Following
such description is a summary description of the changes included in the
Amendments.
BACKGROUND DESCRIPTION OF THE PLAN
The 1992 Plan is intended to assist the Company in attracting,
motivating and retaining directors, officers, key employees and
consultants, by encouraging the ownership of the Common Stock of the
Company and providing incentives for continued service to the Company. The
Compensation Committee of the Board of Directors administers the 1992 Plan,
and in its sole discretion designates the individuals who are to be
participants under the 1992 Plan.
The 1992 Plan authorizes the grant of incentive stock options and non-
qualified stock options (collectively, the "Options").
All Options are granted under the 1992 Plan in the sole discretion of
the Compensation Committee. The maximum number of shares of Common Stock
that may be issued pursuant to Options granted under the 1992 Plan is
2,000,000. The Committee may, in its sole discretion, adjust the aggregate
number of available shares of Common Stock or the price and number of
shares outstanding as Options, in the case of certain capital adjustments,
such as stock dividends, stock splits, or recapitalizations.
The 1992 Plan will expire on November 5, 2002, unless terminated by
the Board of Directors as of an earlier date.
DESCRIPTION OF THE AMENDMENTS
Section 162(m) changes.
Under recently enacted Section 162(m) of the Code, the Company's
deduction is generally limited to $1 million per year for compensation paid
to Section 162(m) Participants, unless certain requirements are met to
-11- <PAGE>
qualify compensation to performance-based criteria. The amendment is
intended to ensure the Company, and its subsidiaries and affiliates, a
federal income tax deduction for any Options granted to Section 162(m)
Participants covered under the 1992 Plan.
The principal change included in the Amendments relating to the
granting of Options under the 1992 Plan limits the maximum number of shares
of Common Stock subject to Options granted to any executive officer for a
fiscal year to 300,000.
Section 16b-3 Changes
In order to qualify as a formula plan pursuant to Rule 16b-
3(c)(2)(ii)(A), the Plan must either (i) state the amount, price and timing
of grants of Options to designated officers and directors (or categories of
officers and directors), or (ii) specify a formula, applying objective
criteria, that determines the amount, price and timing of grants of Options
to such officers and directors. The change approved by the Board of
Directors provides that each nonemployee director shall receive annually on
a prescribed date options to purchase 10,000 shares of Common Stock at an
exercise price equal to the closing price of the Company's Common Stock on
the date of grant as reported on the New York Stock Exchange. A further
requirement is that the formula plan may not be amended more than once
every six months, other than for the purpose of complying with changes in
the Code, ERISA, or rules and regulations promulgated thereunder.
The Board of Directors of the Company recommends a vote FOR the
proposal to approve the Amendment. Proxies received by the Board of
Directors will be so voted unless stockholders specify a contrary choice.
-12- <PAGE>
COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Committee")
has set forth below the components of the Company's executive officer
compensation programs and has described the basis on which fiscal 1994
compensation decisions were made by the Committee with respect to the
executive officers of the Company, including the executive officers that
are named in the compensation table.
COMPENSATION PHILOSOPHY AND OBJECTIVES
In creating its compensation programs, the Company followed a
philosophy that executive compensation is directly linked to continuous
improvements in corporate performance and increases in shareholder value.
The following objectives have been utilized by the Committee as guidelines
for its compensation decisions:
- Compensation should be meaningfully related to the value created for
shareholders.
- Compensation programs should support the short and long-term strategic
goals and objectives of the Company.
- Compensation programs should reflect and promote the Company's values,
and reward individuals for outstanding contributions to the Company's
success.
- Short and long-term compensation play a critical role in attracting
and retaining well qualified executives.
ELEMENTS OF COMPENSATION PROGRAMS
At least annually, the Committee reviews the Company's executive
officer compensation programs to ensure that pay levels and incentive
opportunities are competitive and reflect the performance of the Company.
The three basic components of the program, each of which is intended to
serve the overall compensation philosophy, are as follows:
BASE SALARY - Base salary levels are, in part, established through
comparisons with companies of similar size engaged in the same or similar
business as that of the Company. Actual salaries are based on individual
performance of the executive officer within a salary range reflecting job
evaluation and market comparisons. Base salary levels for executive
officers are reviewed annually and established within a range deemed by the
committee to be reasonable and competitive. The Committee did not
recommend any increases in base salary for the executive officers in fiscal
1994.
ANNUAL INCENTIVES - The Company's executive officers are eligible to
participate in an annual incentive compensation program whose awards are
based primarily on the attainment of certain operating and individual
-13- <PAGE>
goals. The objective of this program is to provide competitive levels of
compensation in return for the attainment of certain financial objectives
that the Committee believes are primary factors in the enhancement of
shareholder value. In particular, the program seeks to focus the attention
of executive officers toward earnings growth. Bonuses for executive
officers of the Company under this program are intended to be consistent
with targeted awards of companies of similar size and engaged in the same
or similar business as that of the Company. Actual awards are subject to
adjustment up or down, at the discretion of the Committee, based on the
Company's overall performance. For fiscal 1994, the Compensation Committee
awarded bonuses to executive officers based upon the performance measures
discussed above. The bonuses are reflective of the Company's overall
improvement in earnings and total stockholder returns in fiscal 1994.
LONG-TERM INCENTIVES - As an important element in retaining and
motivating the Company's senior management, the Committee believes that
those persons who have substantial responsibility for the management and
growth of the Company should be provided with an opportunity to increase
their ownership of Company stock. Therefore, executive officers and
certain other key employees are eligible to receive stock options from time
to time, giving them the right to purchase shares of Common Stock of the
Company at a specified price in the future. The number of stock options
granted to executive officers is based on various factors, including the
respective scope of accountability, strategic and operational goals and
anticipated performance and contributions of the individual executive.
SECTION 162(m). "Compensation", as defined in Section 162(m) of the
Internal Revenue Code, as amended (the "Code"), in excess of $1 million per
year paid to an executive officer is not deductible by the Company unless
such compensation in excess of $1 million per year is payable pursuant to a
performance-based plan, approved by the shareholders of the Company. The
Compensation Committee is in the process of developing performance goals
with respect to compensation exceeding $1 million per year payable to an
executive officer.
COMPENSATION FOR THE PRESIDENT AND CHIEF EXECUTIVE OFFICER
The Committee, in considering the compensation for the President and
Chief Executive Officer for fiscal 1994, reviewed his existing compensation
arrangements and the performances of both Mr. Shirvanian and the Company.
The Committee made the following determinations regarding Mr. Shirvanian's
compensation:
- The Committee determined that Mr. Shirvanian's base salary is at an
appropriate level and no adjustment was made.
- Based upon Mr. Shirvanian's and the Company's fiscal 1994 performance,
the Committee awarded a bonus of $150,000 to Mr. Shirvanian.
- In order to provide a long-term incentive to Mr. Shirvanian, the
Committee awarded him options to purchase 300,000 shares of the
Company's common stock at fair market value on the date of the grant.
-14- <PAGE>
SUMMARY
The Committee believes, based upon its review of the Company's
compensation programs, that the compensation program for executive officers
of the Company is appropriate and competitive with the compensation
programs provided by other companies engaged in the waste management
business. The Committee also believes that the Company's incentive program
provides for awards appropriately related to the Company's and individual
performance. The Committee further believes that the stock option program
provides opportunities to participants that are consistent with the returns
that are generated on behalf of the Company's shareholders.
Compensation Committee
of the Board of Directors
Dr. A.N. Mosich, Chairman
John W. Simmons
-15- <PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain information with respect to
compensation for services in all capacities paid by the Company for the
past three years, to the Chief Executive Officer of the Company at June 30,
1994 and to each of the four other most highly compensated executive
officers of the Company serving at June 30, 1994, including one individual
who ceased to be an executive officer of the Company during fiscal 1994 but
whose reportable salary would have placed him in the group of the four
other most highly compensated executive officers of the Company.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Long-Term
Compensation
Awards
Annual Compensation ------------
----------------------------------- Securities
Underlying
Name and Other Annual Options All Other
Principal Position Year Salary Bonus<F1> Compensation<F2> (Shares)<F3> Compensation<F4>
- ----------------------- ---- ------- --------- -------------- ------------ ----------------
<S> <C> <C> <C> <C> <C> <C>
Kosti Shirvanian 1994 $772,800 $150,000 $-0- 300,000 $4,620
Chairman of the Board 1993 786,800 -0- -0- 450,000<F5> 4,497
and President 1992 781,800 -0- -0- 300,000<F5> 4,364
Ramsey G. DiLibero 1994 121,600 25,000 -0- 24,000 -0-
Chief Operating Officer <F6> 1993 -0- -0- -0- -0- -0-
1992 -0- -0- -0- -0- -0-
Savey Tufenkian 1994 187,680 40,000 -0- 50,000 4,497
Executive Vice President, 1993 204,680 -0- -0- 137,500 4,721
Secretary-Treasurer 1992 183,310 -0- -0- -0- 4,707
Lawrence F. McQuaide 1994 160,080 12,000 -0- 15,000 6,878
Executive Vice President, 1993 162,980 -0- -0- 33,000 812
Finance 1992 168,355 -0- -0- 12,000<F5> 2,391
Richard A. Haft, Jr. 1994 185,894 -0- -0- 15,000 3,584
Executive Vice President, 1993 154,960 -0- -0- 30,000 770
General Counsel <F7> 1992 154,415 -0- -0- 10,000<F5> 2,999
</TABLE>
[FN]
<F1> Includes bonus awards earned for performance in the fiscal year
noted even though such amounts are payable in subsequent years.
<F2> No perquisites and other benefits exceed the lesser of either
$50,000 or 10 percent of the total of annual salary and bonuses
reported for the named executive officer.
-16- <PAGE>
<F3> In September 1992, the Compensation Committee approved the
repricing of the options granted on July 1, 1990 and September 6,
1991 to $10 3/8 ($11.41 or 110% for incentive stock options with
respect to optionees owning more than 10% of the outstanding
shares of the Company's Common Stock), the price of the Common
Stock last reported by the New York Stock Exchange as of the
close of the market on September 10, 1992. As a condition of the
repricing, the Committee required that the number of outstanding
options held by the optionees be reduced by 25%. The options
issued on July 1, 1990 were 75% vested effective July 1, 1993,
and had an original exercise price of $19 1/4 ($21.17 or 110% for
incentive stock options with respect to optionees owning more
than 10% of the outstanding shares of the Company's Common
Stock). The options issued on September 6, 1991 were 67% vested
effective September 6, 1993, and had an original exercise price
of $16 7/8.
<F4> The All Other Compensation column represents the amount of the
Company's matching contribution with respect to each executive
officer under the Company's 401(k) Savings and Investment Plan.
<F5> Stock option grants for fiscal 1991 and 1992 were treated as
canceled and reissued in fiscal 1993. See note <F2>.
<F6> Mr. DiLibero joined the Company in December 1993 as Chief
Operating Officer.
<F7> Mr. Haft, Executive Vice President, General Counsel, resigned
from the Company in March 1994. Included in Mr. Haft's salary
above is $78,000 in severance payments made over a period of
six months ending in September 1994.
-17- <PAGE>
The following table sets forth certain information with respect to
stock options granted to the executive officers named in the Summary
Compensation Table during fiscal 1994. The Company does not grant any
Stock Appreciation Rights.
OPTION GRANTS IN THE LAST FISCAL YEAR
Grant Date
INDIVIDUAL GRANTS Value
- ------------------------------------------------------------- ----------
Percentage
of Total
Number of Options
Securities Granted to
Underlying Employees Grant Date
Options in Exercise Present
Granted Fiscal Price Expiration Value
Name (#)<F1> 1994 ($/sh) Date ($)<F2>
- ----------------- ----------- ------ --------- --------- -----------
Kosti Shirvanian 300,000 40.5% $10.00 7/28/03 $2,154,000
Ramsey G. DiLibero 12,000 1.6% 10.00 7/28/03 86,160
12,000 1.6% 15.13 12/14/03 130,320
Savey Tufenkian 50,000 6.8% 10.00 7/28/03 359,000
Lawrence F. McQuaide 15,000 2.0% 10.00 7/28/03 107,700
Richard A. Haft, Jr. 15,000 2.0% 10.00 9/8/95<F3> 107,700
[FN]
<F1> Stock options granted on July 29, 1993 and December 15, 1993 under the
Company's 1992 Stock Option Plan. Options become fully exercisable on
July 29, 1996 and December 15, 1996, respectively.
<F2> Based upon the Black-Scholes option valuation model. The actual
value, if any, an executive may realize will depend on the excess of
the stock price over the exercise price on the date the option is
exercised. There is no assurance the value realized will be at or
near the value estimated by the Black-Scholes model. The valuation
model uses certain assumptions. The assumptions used in this
valuation were: 7.7% risk-free interest rate, no dividends and a
volatility factor of 0.5002.
<F3> Options granted to Mr. Haft expire on September 8, 1995 in accordance
with the terms of the 1992 Stock Option Plan, as a result of his
resignation.
-18- <PAGE>
The following table sets forth certain information as to each exercise
of stock options during the year ended June 30, 1994 by the Executive
Officers named in the Summary Compensation Table and the fiscal year-end
value of unexercised options:
<TABLE>
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND JUNE 30, 1994 OPTION VALUES
<CAPTION>
Number of Securities
Underlying Unexercised
Shares Options at June 30, 1994 In-the-Money Options
Acquired On Value (#) at June 30, 1994($)<F1>
Name Exercise(#) Realized($)<F1> Exercisable Unexercisable Exercisable Unexercisable
- ----------------- ----------- ------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Kosti Shirvanian -0- -0- 1,003,000 375,000 $9,772,150 $3,721,850
Ramsey G. DiLibero -0- -0- -0- 24,000 -0- 178,500
Savey Tufenkian 10,000 $ 84,750 171,450 126,050 1,686,550 1,231,900
Lawrence F. McQuaide 22,500 206,200 17,750 30,250 162,400 296,750
Richard A. Haft, Jr. 15,000 115,000 40,000 -0- 390,600 -0-
<FN>
<F1> Computed based upon the difference between the aggregate fair market
value and the aggregate exercise price at the exercise date or fiscal
year end as appropriate.
</TABLE>
-19- <PAGE>
PERFORMANCE GRAPH
The following performance graph compares the performance of the
Company's Common Stock to the S & P 500 Index and to the Value Line
Environmental Service Index for the Company's last five fiscal years.
The graph assumes that the value of the investment in the Company's
Common Stock and each index was $100 at June 30, 1989 and that all
dividends were reinvested.
June June June June June June
1989 1990 1991 1992 1993 1994
---- ---- ---- ---- ---- ----
Western Waste Industries 100 188 192 120 106 195
Value Line Index 100 151 120 110 104 94
S&P 500 100 116 125 142 161 163
-20- <PAGE>
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than
ten percent of a registered class of the Company's equity securities, to
file with the Securities and Exchange Commission initial reports of
ownership and reports of changes in ownership of Common Stock and other
equity securities of the Company. Officers, directors and greater than
ten-percent shareholders are required by Securities and Exchange Commission
regulation to furnish the Company with copies of all Section 16(a) forms
they file.
To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company and written representations that no
other reports were required during the fiscal year ended June 30, 1994, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten-percent beneficial owners were complied with.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On May 1, 1968, the Company entered into a 25-year lease with
Mr. Shirvanian, for approximately three and one-half acres of land in
Carson, California, constituting about one-half of the property utilized by
the Company at its Carson transfer station facility. The term of the lease
has been extended to February 28, 1995. At the end of the lease term the
improvements on the land become the property of the lessor. The Company
pays insurance, taxes and maintenance on the property. Rent is being paid
at the rate of $14,457 per month. This lease rate was determined on the
basis of an independent real estate appraisal of the fair market value of
the property completed on January 22, 1986, and is adjusted annually based
on the Consumer Price Index. The Company believes that the terms of the
lease, including the rent, are comparable to those that would have been
included in a lease entered into with an independent third party for
comparable property.
During fiscal 1989, the Company adopted a policy of making interest-
free short-term loans to officers, directors and key employees to enable
them to exercise stock options. During fiscal 1991, Mrs. Tufenkian and
Ralph Tufenkian, Vice President, Corporate Projects (Mrs. Tufenkian's
husband) received short-term loans of $216,000 in connection with the
exercise of stock options. Mrs. Tufenkian and Mr. Tufenkian have repaid
$158,000 leaving a balance of $58,000 as of June 30, 1994. During fiscal
1992, Mr. Shirvanian, received a short-term loan of $197,560 in connection
with the exercise of stock options and $121,177 for the purchase of a life
insurance policy, totalling $318,737. During fiscal 1993, he received an
additional loan of $166,550 and repaid $115,000. In fiscal 1994, he repaid
$150,000 leaving a balance of $220,287 as of June 30, 1994.
In order to induce Mr. McQuaide to relocate to Southern California,
the Company loaned Mr. McQuaide $80,000 in 1984, payable within ten years,
with interest at 8% per annum, to assist him in the purchase of a house.
-21- <PAGE>
Due to the substantial difference between the housing costs in Southern
California and some other parts of the nation, many companies located in
Southern California have had to make similar types of arrangements to
attract talented personnel from other parts of the country. In fiscal
1994, Mr. McQuaide repaid $35,000 on the note leaving an outstanding
principal indebtedness under the note of $35,000.
On August 26, 1994, the Board of Directors of the Company unanimously
(with Mr. Shirvanian abstaining) approved the Company's entry into a split-
dollar life insurance agreement with a trust established by Mr. Shirvanian
and his wife, Marion Shirvanian, providing for life insurance on the life
of Mr. Shirvanian or the lives of Mr. and Mrs. Shirvanian. The owner and
beneficiary of the policy will be the trust. The beneficiaries of the
trust are the descendants of Mr. and Mrs. Shirvanian. Pursuant to the
arrangement, the Company will be obligated to advance the premiums in an
amount not to exceed $500,000 per year for as long as the policy remains in
force, not to exceed 15 years. Upon payment of the policy death benefit,
or upon surrender of the policy, the Company will be entitled to reimburse-
ment of the aggregate premiums advanced by the Company. The approval of
the arrangement by the Board of Directors is conditioned upon the follow-
ing: (i) that the trust pay premiums on additional life insurance in an
amount not less than one-half the face value of the policy on which the
Company is advancing the premiums and (ii) that the charge against the
Company's earnings as a consequence of the arrangement will not exceed the
sum of $150,000 in any fiscal year in which the policy is in effect.
All transactions between the Company and its officers, directors,
employees and shareholders or their affiliates have been, and in the future
will be, subject to the approval of a majority of the independent and
disinterested members of the Board of Directors.
PROPOSAL 4 - RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The accounting firm of Ernst & Young LLP, Long Beach, California, has
served as independent auditors for the Company since January 1985, and,
subject to ratification by the shareholders, has been appointed to serve as
such for the fiscal year ending June 30, 1995. A representative of Ernst &
Young LLP will be present at the annual meeting of shareholders and will be
given an opportunity to make a statement and will be available to respond
to appropriate questions from the shareholders.
The Board of Directors of the Company recommends a vote FOR the
proposal to ratify the appointment of Ernst & Young LLP as independent
auditors for the fiscal year ending June 30, 1995. Proxies received by the
Board of Directors will be so voted unless shareholders specify a contrary
choice.
OTHER BUSINESS
The Board of Directors is not aware of any matters that are to be
presented for action at the meeting other than those set forth herein.
-22- <PAGE>
Should any other matter requiring a vote of the shareholders arise, the
persons named as proxies in the enclosed form of proxy will vote the shares
represented thereby in accordance with their best judgment in the interests
of the Company. Discretionary authority with respect to such other matters
is granted by the execution of the enclosed proxy.
ADDITIONAL INFORMATION
A copy of the Annual Report to shareholders for the fiscal year ended
June 30, 1994 is being delivered concurrently with this Proxy Statement to
all shareholders entitled to notice of and to vote at the Annual Meeting.
The Annual Report is not incorporated in this Proxy Statement and is not to
be considered proxy soliciting material.
Shareholder proposals, if any, which may be considered for inclusion
in the Company's proxy materials for the 1995 Annual Meeting must be
received by the Company at its principal executive office not later than
August 1, 1995. To ensure prompt receipt of the shareholder proposals by
the Company, the proposals should be sent by certified mail, return receipt
requested, to Secretary, Western Waste Industries, 21061 South Western
Avenue, Torrance, California 90501. The proposals must comply with the
proxy rules relating to shareholder proposals in order to be included in
the Company's 1995 proxy material.
By Order of the Board of Directors
SAVEY TUFENKIAN, Secretary
December 21, 1994
-23- <PAGE>
Appendix A
TEXT OF PROPOSED AMENDMENT
TO
BY-LAWS
[The By-laws of this corporation be amended by changing Article II,
Section 2 to read as set forth below.]
(a) The number of directors shall not be less than five (5) nor
more than nine (9), the exact number to be fixed within such limits by a
By-law or amendment thereof adopted by the shareholders or by the Board of
Directors.
(b) Until changed as hereinabove provided or as otherwise
provided by law, the number of directors shall be six (6).
-24- <PAGE>
WESTERN WASTE INDUSTRIES
21061 S. WESTERN AVENUE
TORRANCE, CALIFORNIA 90501
PROXY
This proxy is solicited on behalf of the Board of Directors for the
Annual Meeting of the Shareholders on Friday, January 27, 1995.
The undersigned shareholder(s) of WESTERN WASTE INDUSTRIES does hereby
constitute and appoint SAVEY TUFENKIAN and JOHN W. SIMMONS, and each of
them, with full power of substitution and revocation, the true and lawful
attorney or attorneys and proxies of the undersigned, to vote all shares of
the Common Stock of WESTERN WASTE INDUSTRIES owned by or of record in the
name of the undersigned, at the annual meeting of its shareholders on
Friday, January 27, 1995 at 11:00 A.M., Pacific Standard Time, and at any
and all adjournments thereof, in the manner specified below.
(continued on the reverse side)
THIS PROXY WILL BE VOTED AS DIRECTED, OR, IF NO DIRECTION IS INDICATED,
WILL BE VOTED "FOR" EACH OF THE NOMINEES FOR DIRECTOR AND
FOR EACH OF THE PROPOSALS.
Please mark
______________ your votes
Common as this
[X]
Proposal 1 - To approve an amendment to the Bylaws to permit the Board
of Directors to determine the specific number of directors within a range
of five to nine.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
-25- <PAGE>
Proposal 2 - Election of
Directors:
WITHHOLD Kosti Shirvanian, Harry S.
FOR all nominees AUTHORITY Derbyshire and Dr. A. N. Mosich
listed at the right to vote for
(except as marked all listed (To withhold authority for any
to the contrary) at right nominee, write individual's name
[ ] [ ] in the space provided.)
_________________________________
Proposal 3 - To approve amend- _________________________________
ments to the 1992 Stock Option Plan.
FOR AGAINST ABSTAIN Should any other matters
[ ] [ ] [ ] requiring a vote of the share-
holders arise, the attorneys
above are authorized to vote the
same in accordance with their
Proposal 4 - To ratify the best judgment in the best
appointment of Ernst & Young LLP as interest of the Company.
independent auditors for the fiscal Management is not aware of any
year ending June 30, 1995. matter which is to be presented
for action at the meeting other
FOR AGAINST ABSTAIN than the matters set forth
[ ] [ ] [ ] herein.
(Please sign exactly as name or
names appear on notice of meeting
addressed to you. Executors,
administrators, trustees or other
representatives should so
indicate when signing.)
Dated____________________________
_________________________________
Shareholders Signature
_________________________________
Shareholders Signature
-26- <PAGE>
