Waste Management 2007 Annual Report Download - page 131

Dividends
Our quarterly dividends have been declared by our Board of Directors and paid in accordance with the capital
allocation programs discussed above. The following is a summary of dividends declared and paid each year:
2007 2006 2005
Years Ended December 31,
Cash dividends per common share:
Declared(a) .............................................. $0.96 $0.66 $1.02
Paid................................................... $0.96 $0.88 $0.80
Total cash dividends (in millions):
Declared(a) .............................................. $495 $355 $571
Paid................................................... $495 $476 $449
(a) In 2005, the cash dividend declared amounts included the Board of Directors’ declaration of the first quarterly
dividend for 2006 of $0.22 per share, or $122 million.
In December 2007, we announced that our Board of Directors expects to increase the per share quarterly
dividend from $0.24 to $0.27 for dividends declared in 2008. However, all future dividend declarations are at the
discretion of the Board of Directors, and depend on various factors, including our net earnings, financial condition,
cash required for future business plans and other factors the Board may deem relevant.
15. Stock-Based Compensation
Employee Stock Purchase Plan
We have an Employee Stock Purchase Plan under which employees that have been employed for at least
30 days may purchase shares of our common stock at a discount. The plan provides for two offering periods for
purchases: January through June and July through December. At the end of each offering period, employees are able
to purchase shares of common stock at a price equal to 85% of the lesser of the market value of the stock on the first
or last day of such offering period. The purchases are made through payroll deductions, and the number of shares
that may be purchased is limited by IRS regulations. The total number of shares issued under the plan for the
offering periods in each of 2007, 2006 and 2005 was approximately 713,000, 644,000, and 675,000, respectively.
Including the impact of the January 2008 issuance of shares associated with the July to December 2007 offering
period, approximately 1.3 million shares remain available for issuance under the plan.
Our Employee Stock Purchase Plan is “compensatory” under the provisions of SFAS No. 123(R). Accordingly,
beginning with our adoption of SFAS No. 123(R) on January 1, 2006 we recognize compensation expense
associated with our employees’ participation in the Stock Purchase Plan. Our Employee Stock Purchase Plan
increased annual compensation expense by approximately $5 million, or $3 million net of tax for both 2007 and
2006.
Employee Stock Incentive Plans
Pursuant to our stock incentive plan, we have the ability to issue stock options, stock awards and stock
appreciation rights, all on terms and conditions determined by the Management Development and Compensation
Committee of our Board of Directors.
As of January 1, 2004, we had two plans under which we granted stock options and restricted stock awards: the
2000 Stock Incentive Plan and the 2000 Broad-Based Plan. These two plans allowed for grants of stock options,
appreciation rights and stock awards to key employees, except grants under the 2000 Broad-Based Plan could not be
made to any executive officer. All of the options granted under these plans had exercise prices equal to the fair
96
WASTE MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)