SCHEDULE 14A INFORMATION
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☐ | Soliciting Material Pursuant to §240.14a-11(c) or §240.14a-12 |
WEYERHAEUSER COMPANY
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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Notes:
WEYERHAEUSER Notice of the 2021 Annual Meeting & Proxy Statement 2021
DEAR SHAREHOLDER:
We are pleased to invite you to attend your companys annual meeting of shareholders at 8:00 a.m. Pacific Time on Friday, May 14, 2021. We are sensitive to the public health and travel concerns our various stakeholders may have and the recommendations that public health officials and federal, state and local governments have issued in light of the COVID-19 pandemic. As a result, the annual meeting will be conducted virtually via audio webcast. You will be able to attend the meeting, vote your shares and submit questions by logging on to www.virtualshareholdermeeting.com/WY2021.
The annual meeting will include a report on our operations and consideration of the matters set forth in the accompanying notice of annual meeting and proxy statement. All shareholders of record as of March 18, 2021 are entitled to vote.
Your vote is important. Whether or not you plan to attend the virtual annual meeting, we urge you to please vote as soon as possible. You can vote in the manner described in the section titled Information about the Meeting Voting Matters Options for Casting Your Vote on page 71 of the accompanying proxy statement.
On behalf of your board of directors, thank you for your continued ownership and support of Weyerhaeuser.
Sincerely,
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Rick R. Holley | Devin W. Stockfish | |
Chairman of the Board | President and Chief Executive Officer |
OUR CORE VALUES
Safety ● Integrity ● Citizenship ● Sustainability ● Inclusion
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NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS |
2021 ANNUAL MEETING INFORMATION
For additional information about our annual meeting, see Information about the Meeting on page 70.
Meeting Date: May 14, 2021 |
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Meeting Time: 8:00 a.m. (Pacific) |
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Record Date: March 18, 2021 |
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Virtual Meeting Location: Audio Webcast www.virtualshareholdermeeting.com/WY2021 | ||||||
ANNUAL MEETING BUSINESS
Weyerhaeuser Companys Annual Meeting of Shareholders will be held May 14, 2021 to:
● | elect as directors the nine nominees named in the accompanying proxy statement; |
● | approve, on an advisory basis, the compensation of our named executive officers; |
● | ratify the selection of KPMG LLP as the companys independent registered public accounting firm for 2021; and |
● | transact any other business that may be properly brought before the annual meeting. |
PROXY MATERIALS
On or about March 31, 2021, we began distributing to each shareholder entitled to vote at the annual meeting either: (i) a Meeting Notice; or (ii) this proxy statement, a proxy card and our 2020 Annual Report to Shareholders and Form 10-K. The Meeting Notice contains instructions to electronically access our proxy statement and our 2020 Annual Report to Shareholders and Form 10-K, how to vote via the internet or by mail and how to receive a paper copy of our proxy materials by mail, if desired.
ATTENDING AND VOTING AT THE ANNUAL MEETING
There will be no physical location for the annual meeting. Shareholders may attend, vote and ask questions at the meeting only by logging in at www.virtualshareholdermeeting.com/WY2021. To participate, you will need your unique control number included on your proxy card or on the instructions that accompanied your proxy materials.
Your vote is important. Shareholders who are owners of record of Weyerhaeuser common shares at the close of business on March 18, 2021, the record date, or their legal proxy holders, are entitled to vote at the annual meeting. Whether or not you expect to attend the virtual annual meeting, we urge you to vote as soon as possible by one of these methods:
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Via the Internet: www.proxyvote.com |
Call Toll-Free: 1-800-690-6903 |
Mail Signed Proxy Card: Follow the instructions on your proxy card or voting instruction form | ||
If you are a beneficial owner of shares held through a broker, bank or other holder of record, you must follow the voting instructions you receive from the holder of record to vote your shares. Shareholders may also vote at the virtual annual meeting. For more information on how to vote your shares, please refer to Information about the Meeting Voting Matters Options for Casting Your Vote on page 71. | ||||
Kristy T. Harlan
Senior Vice President, General Counsel and Corporate Secretary
Seattle, Washington
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to be Held on May 14, 2021
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This Notice of the Annual Meeting of Shareholders, our Proxy Statement and our Annual Report to
Shareholders and Form 10-K are available free of charge at www.proxyvote.com.
PROXY SUMMARY
This summary highlights information contained elsewhere in this proxy statement and does not contain all the information you should consider before casting your vote. Please read this entire proxy statement carefully before voting.
2020 DEVELOPMENTS AND ACTIONS
By almost any definition 2020 was unprecedented for our people, our operations, our customers and our communities. As a company, we managed through an ongoing global pandemic and unpredictable economic environment, forest fires in the West, multiple hurricanes in the South and resulting market and supply chain disruptions. Despite these challenges, we took a number of steps in 2020 to position Weyerhaeuser to deliver superior long-term value for our stakeholders.
Board Engagement. Our board of directors was highly engaged in overseeing the companys response to the pandemic over the course of the year, receiving frequent updates on the impact to the company and its operations, holding additional meetings to address ongoing COVID-19 implications and maintaining frequent communication with the companys senior management team. Along with the board and its committees, individual directors each made themselves available for formal and informal consultation with management on an ad hoc basis throughout the year.
Safety. At the outset of the COVID-19 pandemic we took swift action to put strict protocols in place to keep our employees safe and healthy, which allowed us to continue safely and effectively serving our customers. Additionally, we significantly reduced both the number and severity of injuries in 2020.
Operating Results. Each of our business segments delivered remarkable results despite unprecedented operating and market challenges. For the full-year 2020 the company achieved net earnings of $797 million and earnings of $962 million before special items*. Adjusted EBITDA* for full-year 2020 was $2.2 billion, our best performance in 15 years. We also captured approximately $100 million of operational excellence (OpX) improvements, all while demonstrating an unwavering commitment to safety.
Balance Sheet. During 2020 we strengthened our balance sheet and financial position through opportunistic liability management. We reduced our gross debt in 2020 by over $900 million and refinanced at favorable rates $569 million of our senior notes that were due in 2021. We also ensured the company had ample liquidity, primarily through our $1.5 billion revolving line of credit, and maintained our investment grade credit rating.
Pay Adjustments. In light of the COVID-19 pandemic, members of the companys board of directors and senior management team elected on April 30th to reduce their compensation. This included a 20 percent reduction in 2020 fees for the board of directors, a base salary reduction of 30 percent for our CEO and base salary reductions of 10 percent for the remainder of the senior management team.
*Earnings before special items and Adjusted EBITDA represent measures of performance that are calculated and presented other than in accordance with GAAP. See Appendix A for an explanation of these non-GAAP measures, a full reconciliation of these measures of our results to our GAAP Net Earnings results and a brief discussion of why we use these non-GAAP performance measures.
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PROXY SUMMARY
New Dividend Framework. In the fourth quarter, the board re-initiated the dividend and implemented a new dividend framework. The new framework consists of a quarterly base dividend and a variable supplemental dividend which is expected to be paid annually. The new dividend framework supports our commitment to returning a significant portion of free cash flow to shareholders while ensuring that our return of cash is sustainable and appropriate across market cycles.
Portfolio Improvements. We always strive to strategically optimize our timberlands portfolio. In furtherance of that goal, we completed two important timberlands transactions in 2020. First, we sold our Montana timberlands for approximately $145 million in cash in March. In September, we optimized our Oregon timberlands holdings by purchasing approximately 85,000 acres of timberlands in mid-coastal Oregon and selling 149,000 acres of timberlands in southern Oregon.
Sustainability. Building on our long history of operating our business sustainably, in 2020 we announced a new sustainability strategy. Our new strategy builds on our solid foundation of environmental stewardship, social responsibility and strong governance. It also challenges us to make a positive impact in three critical ways: contribute to climate change solutions, help provide affordable and sustainably built housing and strengthen the communities in which we live and operate.
DIRECTOR NOMINEES (page 25)
Our board strives to maintain an appropriate balance of tenure, diversity, characteristics, talents, skills and expertise to provide sound and prudent guidance with respect to the companys operations and interests. The board engages in robust succession planning activities that have resulted in a strong track record of refreshment and a board with a balanced range of ages, skills, experience and tenure. In addition, our board increased both its racial and gender diversity over the past year. Three of our current directors, Marc Racicot, Michael Steuert and Charles Williamson, will retire from the board at the annual meeting in accordance with our mandatory retirement policy and therefore have not been nominated for re-election.
We have included summary information about each director nominee in the table below. Each director is elected annually by a majority of votes cast.
COMMITTEE | ||||||||||||||
Name and Primary Occupation
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Age
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Director
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Independent
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EC
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AC
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CC (1)
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GCRC
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Mark A. Emmert President, National Collegiate Athletic Association
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68 | 2008 | 🌑 | 🌑 | ||||||||||
Rick R. Holley (Chairman) Former Chief Executive Officer, Plum Creek Timber Company, Inc.
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69 | 2016 | 🌑 | 🌑 | ||||||||||
Sara Grootwassink Lewis Former Chief Executive Officer, Lewis Corporate Advisors
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53 | 2016 | 🌑 | Chair | ||||||||||
Deidra C. Merriwether Senior Vice President and Chief Financial Officer,
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52 | 2020 | 🌑 | 🌑 | ||||||||||
Al Monaco President and Chief Executive Officer, Enbridge Inc.
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61 | 2020 | 🌑 | 🌑 | ||||||||||
Nicole W. Piasecki Former Vice President and General Manager, Propulsion Division, Boeing Commercial Airplanes
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58 | 2003 | 🌑 | 🌑 | Chair | |||||||||
Lawrence A. Selzer President and Chief Executive Officer, The Conservation Fund
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61 | 2016 | 🌑 | 🌑 | 🌑 | |||||||||
Devin W. Stockfish President and Chief Executive Officer, Weyerhaeuser Company
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47 | 2019 | 🌑 | |||||||||||
Kim Williams Former Partner and Senior Vice President, Wellington Management Company, LLP
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65 | 2006 | 🌑 | 🌑 | 🌑 |
EC = Executive Committee AC = Audit Committee CC = Compensation Committee GCRC = Governance and Corporate Responsibility Committee
(1) | Charles Williamson, the current chair of the Compensation Committee and our lead independent director, will retire from the board of directors effective on the date of the annual meeting. The board will appoint a new committee chair at that time. |
2021 ANNUAL MEETING & PROXY STATEMENT
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PROXY SUMMARY
DIRECTOR NOMINEE GROUP INFORMATION
DIRECTOR NOMINEE CORE COMPETENCIES
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PROXY SUMMARY
CORPORATE GOVERNANCE HIGHLIGHTS (page 14)
Our corporate governance policies and practices promote the long-term interests of our shareholders, strengthen the accountability of our board of directors and management and help build public trust in the company. In a year in which the company faced unprecedented challenges presented by COVID-19, these policies and practices proved more important than ever. Our governance policies and practices helped us keep our employees, customers and other stakeholders safe while we continued to run our businesses effectively, efficiently and profitably with the full commitment, support and guidance of our board of directors. Below is a summary of some of the highlights of our corporate governance framework.
Board Practices
8 of 9 director nominees are independent
Annual election of all directors
Separation of board chair and CEO
Regular executive sessions of independent directors
Comprehensive and strategic risk oversight
Mandatory retirement age for directors at 72
Annual board and committee evaluations
Limits on outside board service for directors |
Shareholder Matters
Robust shareholder engagement
Proxy access for shareholders
Shareholder right to call special meetings
Majority voting for director elections
Annual Say-on-Pay voting
Other Governance Practices
Executive and director stock ownership requirements
Clawback policy
Prohibition on hedging or pledging company stock | |
SUSTAINABILITY AND ESG PRACTICES (page 8)
In 2020, we launched a new sustainability strategy. This strategy builds on our solid foundation of environmental stewardship, social responsibility and strong governance and challenges us to demonstrate progress in three critical focus areas where our company is uniquely poised to have a positive impact on the world. These are our 3 by 30 Sustainability Ambitions, and we are committed to making tangible progress in each area by the year 2030.
BUSINESS PERFORMANCE HIGHLIGHTS
Our business and financial performance provides important context for the matters discussed in this proxy statement, particularly our executive compensation programs. Following is a brief snapshot of our financial performance and significant business achievements in 2020.
2020 Business Achievements
All our businesses delivered strong operational results despite the challenges and disruptions associated with the COVID-19 pandemic, and we generated higher earnings and cash flow than in 2019. Given the significant uncertainty
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PROXY SUMMARY
regarding the duration and magnitude of the effects of the pandemic on the companys business conditions, we took quick precautionary actions in the first and second quarters of 2020 to preserve our liquidity and financial flexibility, including reducing capital expenditures and non-essential operating expenses, as well as temporarily suspending the companys quarterly cash dividend, which we reinitiated in the fourth quarter along with a new dividend framework. Highlights of our 2020 performance include:
Financial Results
* Represents a measure of performance that is calculated and presented other than in accordance with GAAP. See Appendix A for an explanation of this non-GAAP measure, a full reconciliation of this measure of our results to our GAAP Net Earnings results and a brief discussion of why we use this non-GAAP performance measure.
Strategic Initiatives
✓ Achieved a new record-low cost structure in our Lumber business.
✓ Optimized our timberlands portfolio by divesting our Montana timberlands and strategically upgrading our Oregon timberland holdings.
✓ Launched our new sustainability strategy.
✓ Captured over $100 million of OpX improvements, exceeding our company target for 2020 (which was $50 $70 million).
Capital Allocation
✓ Reduced our gross debt by over $900 million.
✓ Implemented a new dividend framework comprised of a sustainable quarterly base dividend and variable supplemental dividends generally paid on prior-year cash flows. |
Stakeholder Recognitions
✓ Included in the Dow Jones Sustainability North American Index, an honor we have held each year since 2005.
✓ Named one of the Worlds Most Ethical Companies® by the Ethisphere Institute for the twelfth time.
✓ Named for the fourth time among the Top 250 most effectively managed companies by The Wall Street Journal. | |||||
Our leadership team is committed to maintaining a relentless focus on optimizing our overall portfolio, continuing to improve performance through operational excellence and driving value for shareholders through disciplined capital allocation.
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PROXY SUMMARY
COMPENSATION HIGHLIGHTS (page 33)
In 2020, we received more than 95% shareholder support for our Say-on-Pay vote, which our Compensation Committee considers to be among the most important items of feedback about our pay program.
Our executive compensation program is designed to provide a market-competitive pay opportunity that ensures we attract and retain top talent, with pay directly linked to the achievement of short- and long-term business results that strongly align our executives interests with those of our shareholders.
Objective | Key Compensation Practices |
Offer competitive pay opportunity that allows us to attract and retain top talent. | A significant portion of executive pay is performance-based.
We target compensation in the median range of market pay.
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Emphasize pay-for-performance that drives superior financial results and value creation. | A significant portion of our executive pay is performance-based compensation.
We evaluate performance against rigorous pre-set goals.
When appropriate, we exercise negative discretion to reduce incentive compensation otherwise payable.
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Provide strong alignment with the interests of our shareholders. | Equity constitutes a significant portion of our executive pay.
Performance Share Unit awards are tied to a 3-year relative TSR measure.
We have strong stock ownership requirements.
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Mitigate unnecessary and excessive risk-taking. | No employment agreements or guaranteed bonuses.
We have a clawback policy and anti-hedging and pledging policy.
Double trigger acceleration of LTIP and CIC benefits.
No perquisites other than limited relocation benefits and, when necessary, security services, and no tax gross ups for golden parachute excise taxes.
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SUSTAINABILITY AT WEYERHAEUSER
Minimizing Our Environmental Footprint
We meet or exceed rigorous environmental standards in all areas where we operate, and we constantly strive to improve the efficiency of our operations. We focus on increasing energy and resource efficiency, reducing greenhouse gas emissions, conserving natural resources and offering products with superior sustainability attributes that meet our customers needs. We set measurable sustainability goals aligned with our business strategy and regularly evaluate our progress.
We are committed to continuously improving our sustainability practices based on sound science and innovation. We actively monitor environmental conditions that could affect our assets and operations and partner with and support local, regional, national and global nonprofit organizations, research institutes, universities and government agencies on research efforts and projects.
Growing Our People and Communities
Our company needs diverse, talented people to grow, innovate and thrive with us. We also need strong communities with people who trust and support our work and who grant us the license to continue operating.
For us, this commitment to our people and our communities means creating a safe, inclusive work environment. It also means supporting the communities where we operate so they can be vibrant, prosperous places to live and work.
Safety. Perhaps the most fundamental characteristic of our culture at Weyerhaeuser is our deep commitment to the safety of our people. For us, safety is a core value and comes first in everything we do, and our industry-leading safety results are driven by:
● | Caring leadership with a safety-focused tone at the top; |
● | Engaged employees with robust safety training and education; and |
● | A strong focus on identifying and reducing hazards and risks. |
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SUSTAINABILITY AT WEYERHAEUSER
Our efforts have resulted in a significant and sustained reduction in the number and severity of recordable injuries. We remain relentlessly focused on achieving our goal of creating an injury-free workplace.
* | Recordable Incident Rate (RIR) calculated based on the number of Occupational Safety and Health Administration (OSHA) defined recordable injuries/illnesses that occur in 100 workers working in one year. |
Building a Diverse and Inclusive Culture. The urgency of inclusion has never been greater. Inclusion is a core value for our company, and we are taking real action to increase diversity at all levels, create a truly inclusive environment and secure, preserve and promote equity for all people both within our operations and in our communities.
In 2019, we formed an Inclusion Council of 20 diverse employees from all corners of our company. Based on their input, we established six focus areas for measurable and targeted improvement:
● | Leadership and accountability; |
● | Equitable practices and policies; |
● | Training and development; |
● | Recruiting and hiring; |
● | Communication and culture; and |
● | Affinity and connection. |
In 2020, we took deliberate and meaningful steps to achieve progress in each area and further strengthen our culture, including delivering unconscious bias training to more than 1,600 salaried leaders and employees; shielding the names of candidates on résumés; launching an inclusion-focused leadership blog to explore issues of diversity, equity and inclusion with our employees; and publishing an internal story series highlighting important holidays, milestones, observances and/or awareness months for various diverse groups. In 2021 and the years ahead, we will continue to broaden and deepen our focus on this critical core value.
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SUSTAINABILITY AT WEYERHAEUSER
People Development. People development is a key focus area and critical part of our company vision. We are intentional about developing our people at all levels of the company and at all stages of their careers, and to support our objectives we:
● | Partner with our employees on individual development plans and provide a range of individual development tools; |
● | Annually enroll hundreds of our front-line, mid-level and future executive leaders in development programs; |
● | Engage in rigorous internal talent assessment and succession planning; and |
● | Monitor and regularly review our strategies and action plans to address any workforce gaps in our organization, including gender, race and other underrepresented groups. |
We operate in rural communities across North America, and we are proud to give our time and money to help ensure they are thriving places to live and work. In 2020, we provided $5.3 million in charitable grants, in-kind donations and sponsorships in our communities. Our employees led 176 community projects and volunteered 13,158 hours of their time to causes they care about, which was less than normal due to the pandemic but still a strong testament to the generosity and commitment of our people to their communities. We also held a companywide food bank drive in 2020, which raised $375 thousand through employee donations and our company match program to help our neighbors in need combat food insecurity. Throughout the year, our employees also gave to their favorite charities using our online giving platform, which provides a company match and payroll deduction option.
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SUSTAINABILITY AT WEYERHAEUSER
Our New Sustainability Strategy Goals
We believe that businesses can help solve some of the worlds toughest challenges, and we take this responsibility seriously. We have identified three critical challenge areas where we believe Weyerhaeuser can make a positive impact, and we are committed to making tangible progress in each area by 2030. We have laid out a roadmap of actions to support these 3 by 30 Sustainability Ambitions, which align with the UN Sustainable Development Goals, and we look forward to reporting on our progress as we achieve those objectives.
OUR WORKING FORESTS Contribute to Climate Solutions
Climate change will almost certainly result in the disruption of normal business patterns, and it is essential for us to address the unique risks it poses for our people, our operations and the communities where we live and work. Fortunately, one of the largest opportunities to remove CO2 already exists: forests. Our timberlands have a tremendous role to play in mitigating climate change. Our forests store CO2 from the atmosphere, and that carbon is stored for decades in the long-lived wood products that we produce. Our early actions in this area are focused on ensuring that working forests and the products that come from them are fully recognized as one of the key solutions to managing climate change and positioning Weyerhaeuser to be a meaningful part of that solution. | ||
OUR SUSTAINABLE PRODUCTS Help Provide Homes for Everyone
The wood products that we manufacture can help meet the growing need for affordable, sustainable homes. Wood is an efficient, low-cost, renewable building material that has lower embodied emissions than steel or concrete. With innovative uses for wood on the horizon that would allow for structures to be built even more efficiently and sustainably, we believe our wood products and deep industry expertise have a critical role to play in helping solve the challenge of affordable housing. Our early actions in this area are focused primarily on enhancing awareness of wood as a sustainable building option for all sorts of structures from single family homes to high-rise buildings, and leveraging our scale, expertise and distribution channels to support builders of affordable housing. | ||
WE HELP OUR RURAL COMMUNITIES Be Thriving Places to Work and Live
Most of our employees live in rural communities across North America. These small towns are often built around a history of forestry and manufacturing. In some rural areas, however, the barriers to economic and social prosperity can be difficult to overcome, particularly in communities that lack access to good job opportunities and are experiencing population declines and other shifts in demographics. We are acutely aware of the challenges these rural communities face. Our early actions are focused on measurable improvements in how we, and others in our communities, approach community investment and engagement; create resilient, diverse pipelines for workforce development opportunities; and bridge the divide between urban and rural views of nature and forests. |
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CORPORATE GOVERNANCE AT WEYERHAEUSER
CORPORATE GOVERNANCE AT WEYERHAEUSER
OVERVIEW
Our corporate governance practices and policies promote the long-term interests of our shareholders, strengthen the accountability of our board of directors and management and help build public trust in our company. Our governance framework is built on a foundation of written policies and guidelines, which we modify and enhance on a continuous basis to reflect best practices and feedback from our shareholders. Our Corporate Governance Guidelines and other key governance policies and documents are available on our website at investor.weyerhaeuser.com.
ALIGNMENT WITH INVESTOR STEWARDSHIP GROUP PRINCIPLES
Our corporate governance practices align with the governance principles set out in the corporate governance framework established by the Investor Stewardship Group, or ISG, for U.S.-listed companies, as shown in the table below.
ISG Principle |
WY Governance Practice | |
Principle 1: Boards are accountable to shareholders. |
● All directors stand for election annually
● Proxy access with market terms
● Majority voting standard in uncontested director elections
● Directors not receiving majority support must tender resignation for consideration
● No poison pill board-adopted policy requires shareholder approval prior to adoption unless approved by majority of independent directors
● Robust disclosure of our corporate governance practices | |
Principle 2: Shareholders should be entitled to voting rights in proportion to their economic interest. |
● Single class of voting shares
● One share, one vote standard | |
Principle 3: Boards should be responsive to shareholders and be proactive in order to understand their perspectives. |
● All directors attend our annual meeting, providing an opportunity for shareholder engagement
● Board considers annual voting results and ongoing investor engagement feedback in setting company policies and strategy
● Directors engage with major shareholders as appropriate as a part of our ongoing outreach programs | |
Principle 4: Boards should have a strong, independent leadership structure. |
● Independent chair of the board, with clearly defined responsibilities
● Board considers appropriateness of its leadership structure at least annually
● Proxy statement discloses why board believes current leadership structure is appropriate |
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CORPORATE GOVERNANCE AT WEYERHAEUSER
ISG Principle |
WY Governance Practice | |
Principle 5: Boards should adopt structures and practices that enhance their effectiveness. |
● Board composition reflects broad range of relevant perspectives, skills and knowledge
● 89% of board members are independent; each key committee is fully independent
● Active director refreshment with seven new board members since 2015
● Mandatory retirement age (72)
● Directors attended 99% of total board and committee meetings in 2020
● All directors attended our 2020 Annual Meeting of Shareholders
● Limits on outside board service
● Policy provides board may retain independent outside advisors in its discretion
● Annual board and committee evaluation process | |
Principle 6: Boards should develop management incentive structures that are aligned with the long-term strategy of the company. |
● Compensation Committee annually reviews and approves incentive program design for alignment with business strategies
● Compensation program structure includes combination of short- and long-term performance goals
● Proxy Statement includes clear and robust disclosure regarding compensation program philosophy, objectives and design |
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CORPORATE GOVERNANCE AT WEYERHAEUSER
The boards primary committees are the Audit, Compensation and Governance and Corporate Responsibility Committees. These committees are comprised exclusively of independent directors and, in the case of the Audit Committee and Compensation Committee, include members who meet enhanced regulatory requirements for service on those committees. The board also has an Executive Committee. Each committee is governed by a written charter, a copy of which can be found on the companys website at investor.weyerhaeuser.com.
Current Members
Sara Grootwassink Lewis (Chair) Deidra C. Merriwether Marc F. Racicot* Lawrence A. Selzer D. Michael Steuert* Kim Williams |
Audit Committee
The Audit Committee oversees the quality and integrity of the companys accounting, auditing and financial reporting practices, as well as the companys compliance with legal and regulatory requirements. The committee is also responsible for:
● The appointment, compensation and general oversight of the companys independent auditors;
● Pre-approving all audit and non-audit services to be performed by the companys independent auditors and all related fees;
● Annually assessing the performance of the independent auditors and internal audit function;
● Reviewing and discussing the companys quarterly financial statements and quarterly earnings press releases and related communications; and
● Reviewing the effectiveness of the companys system of internal controls.
All members are financially literate within the meaning of stock exchange listing rules.
All members are independent and meet additional stock exchange and SEC independence standards for audit committee service.
Each of Sara Grootwassink Lewis and Deidra Merriwether is an audit committee financial expert as defined by the SEC, and each committee member has accounting or related financial management expertise as required by stock exchange listing standards. |
*Retiring | at the annual meeting. |
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CORPORATE GOVERNANCE AT WEYERHAEUSER
Current Members
Charles R. Williamson (Chair)* Mark A. Emmert Al Monaco Nicole W. Piasecki |
Compensation Committee
The Compensation Committee reviews and approves the strategy and design of the companys compensation and benefits systems and makes compensation decisions for the companys executive officers. The committee also:
● Administers the companys incentive compensation plans, including establishment of performance goals and certification of the companys performance against those goals;
● Regularly reviews and approves changes to the peer group used for benchmarking compensation for executive officers;
● Reviews and recommends to the board the compensation of the companys non-employee directors; and
● Appoints and oversees the independent compensation consultant and annually ensures that the consultants work raises no conflicts of interest.
All members are independent and meet additional stock exchange and SEC independence standards for compensation committee members.
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Current Members
Nicole W. Piasecki (Chair) Marc F. Racicot* Lawrence A. Selzer Kim Williams |
Governance and Corporate Responsibility Committee
The Governance and Corporate Responsibility Committee oversees the companys governance structure and practices. It is also responsible for evaluating overall board composition, ensuring that the appropriate skills, backgrounds and experience are adequately represented on the board, and making recommendations for board nominees accordingly. The committee also:
● Manages the board and committee evaluation process;
● Provides oversight of sustainability strategy and performance;
● Oversees the process for the boards evaluation of our CEOs performance; and
● Provides oversight of ethics and business conduct.
All members are independent.
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Current Members
Charles R. Williamson (Chair)* Rick R. Holley Devin W. Stockfish |
Executive Committee
The Executive Committee is authorized to act for the board in the interval between board meetings, except to the extent limited by law, applicable stock exchange listing standards or the companys charter documents. |
*Retiring | at the annual meeting. |
Board and Committee Oversight
The board is actively involved in the oversight of risks that could affect the company. This oversight is conducted at the full board level and through committees of the board pursuant to the written charters of each of the committees outlining its duties and responsibilities. The full board has retained responsibility for oversight of strategic risks as well as risks not otherwise delegated to one of its committees. The board stays informed of each committees management of enterprise risk through regular reports by each committee chair to the full board regarding the committees deliberations and actions. The board believes that this structure provides the appropriate leadership to help ensure effective risk oversight.
2021 ANNUAL MEETING & PROXY STATEMENT
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CORPORATE GOVERNANCE AT WEYERHAEUSER
Committee Risk Oversight | ||||||||||||
Audit Committee |
|
|
Governance and Corporate
|
|
|
Compensation Committee | ||||||
The Audit Committee oversees
To satisfy these responsibilities, the
The committee receives regular
The committee is also responsible for |
The Governance and Corporate
To assist the committee in
Because some of these risks could |
The Compensation Committee
To assist
it in satisfying these | ||||||||||
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CORPORATE GOVERNANCE AT WEYERHAEUSER
2021 ANNUAL MEETING & PROXY STATEMENT
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19
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CORPORATE GOVERNANCE AT WEYERHAEUSER
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CORPORATE GOVERNANCE AT WEYERHAEUSER
2021 ANNUAL MEETING & PROXY STATEMENT
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21
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CORPORATE GOVERNANCE AT WEYERHAEUSER
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CORPORATE GOVERNANCE AT WEYERHAEUSER
2021 ANNUAL MEETING & PROXY STATEMENT
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ITEM 1. ELECTION OF DIRECTORS
The nine persons identified below are nominated to be elected as directors at the 2021 annual meeting for one-year terms expiring at the 2022 annual meeting. Except for Ms. Deidra Merriwether, who was appointed on November 12, 2020, all nominees were elected as directors by shareholders at the 2020 annual meeting for a one-year term expiring at the 2021 annual meeting. Our board currently has 12 members. Under our Articles of Incorporation and Bylaws, the board of directors is authorized to fix the number of directors within the range of nine to 13 members. In accordance with the boards mandatory retirement policy, Marc Racicot, Michael Steuert and Charles Williamson will retire from the board at the 2021 annual meeting and therefore are not nominated for re-election. In connection with their retirements, the board has adopted a resolution setting the number of directors serving on the board to nine members effective immediately upon the retirement of the three directors.
Unless a shareholder instructs otherwise on the proxy card, it is intended that the shares represented by properly executed proxies will be voted for the persons nominated by the board of directors. The board of directors anticipates that the listed nominees will be able to serve, but if at the time of the meeting any nominee is unable or unwilling to serve, the proxy holders may vote such shares at their discretion for a substitute nominee.
The biography of each of the nominees below contains information regarding the individuals service as a director, business experience, director positions held currently or at any time during the last five years, and information regarding their experiences, qualifications, attributes or skills considered by the Governance and Corporate Responsibility Committee and the board of directors to assess the nominees candidacy for nomination.
The board of directors recommends that shareholders vote FOR the election of each of the following directors. |
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ITEM 1. ELECTION OF DIRECTORS
MARK A. EMMERT
Age: 68
Director Since: 2008
|
Biographical Information: Mark A. Emmert has been the president of the National Collegiate Athletic Association since 2010. He served as president of the University of Washington in Seattle, Washington, from 2004 to 2010; as chancellor of Louisiana State University from 1999 to 2004; and chancellor and provost of the University of Connecticut from 1994 to 1999. Prior to 1994, he was provost and vice president for Academic Affairs at Montana State University and held faculty and administrative positions at the University of Colorado. He also is a director of Expeditors International of Washington, Inc. (global logistics services). He previously served on the board of directors of Omnicare, Inc. (healthcare services) until 2015.
Qualifications: Mr. Emmert is a Life Member of the Council on Foreign Relations and is a Fellow of the National Academy of Public Administration. He has also been a Fulbright Fellow, a Fellow of the American Council on Education and served on many non-profit boards. He is an experienced leader of major organizations, with strong skills in government and international relations, strategic planning and public company executive compensation.
Core Competencies: ● CEO or Equivalent Leadership Role for Large Company ● Public Company Board ● Government, Regulatory or Legal ● International Business
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RICK R. HOLLEY
Age: 69
Director Since: 2016
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Biographical Information: Rick R. Holley served as the president and chief executive officer of Plum Creek Timber Company, Inc. (timber) from 1994 to 2013 and continued to serve as chief executive officer until February 2016, at which time Plum Creek merged with Weyerhaeuser. From 1989 to 1994, Mr. Holley served as Plum Creeks chief financial officer. He previously served on the board of directors of Avista Corporation (electric and natural gas utility) until 2014 and as a director of Plum Creek until February 2016.
Qualifications: Mr. Holley, one of the longest tenured chief executive officers in the timber industry, has a deep and broad understanding of the companys industry and business lines, as well as experience in strategic planning and finance.
Core Competencies: ● CEO or Equivalent Leadership Role for Large Company ● Public Company Board ● Timber, Land Management or Real Estate ● Manufacturing or Capital-Intensive Industry ● Government, Regulatory or Legal ● Environmental Management & Strategy ● Finance & Capital Markets
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2021 ANNUAL MEETING & PROXY STATEMENT
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25
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ITEM 1. ELECTION OF DIRECTORS
SARA GROOTWASSINK LEWIS
Age: 53
Director Since: 2016
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Biographical Information: Sara Grootwassink Lewis founded Lewis Corporate Advisors (capital markets advisory firm) in 2009, where she served as chief executive officer until 2017. From 2002 to 2009, she was chief financial officer of Washington Real Estate Investment Trust Company (equity REIT). She was previously the vice president of finance and investor relations at Corporate Office Properties Trust (office and data center REIT) and sell-side REIT equity analyst with Johnston, Lemon & Co. (financial services). Ms. Lewis also serves on the board of directors of Healthpeak Properties, Inc. (life science, senior housing and medical office real estate) and Sun Life Financial, Inc. (global financial services). She previously served on the boards of PS Business Parks, Inc. (commercial real estate) until 2019, CapitalSource Inc. (commercial lending) until its acquisition in 2014, Plum Creek Timber Company, Inc. (timber) until February 2016 and Adamas Pharmaceuticals, Inc. (specialty pharmaceuticals) until June 2016. Ms. Lewis also serves on the audit committee council and corporate governance working group of the Center for Audit Quality, the board of trustees of The Brookings Institution, the leadership board of the U.S. Chamber of Commerce Center for Capital Markets Competitiveness, and the advisory council for risk oversight of the National Association of Corporate Directors. She is also a former member of the Public Company Accounting Oversight Board Standing Advisory Group, where she served from 2015 to 2017.
Qualifications: Ms. Lewis has extensive executive, financial and real estate industry experience, having served as a senior executive of a publicly traded REIT and on several public company boards. She also holds a chartered financial analyst designation and is a certified public accountant.
Core Competencies: ● Public Company Board ● Timber, Land Management or Real Estate ● Manufacturing or Capital-Intensive Industry ● Government, Regulatory or Legal ● Finance & Capital Markets ● International Business
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DEIDRA C. MERRIWETHER
Age: 52
Director Since: 2020
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Biographical Information: Deidra C. Merriwether, appointed as a director of the company in November 2020, has served as senior vice president and chief financial officer for W.W. Grainger, Inc. (industrial maintenance, repair and operating products supply) since January 2021. In previous roles with Grainger she was the senior vice president and president of North American Sales & Services in 2020, senior vice president of Direct Sales and Strategic Initiatives from 2016 to 2020, and vice president and chief financial officer, Americas, from 2013 to 2016. Prior to Grainger, she was with Sears Holdings Corp. (retail) as chief operating officer of Retail Formats from 2011 to 2013; senior vice president and chief financial officer of Retail Formats from 2008 to 2011; vice president of Procurement & Merger Integration from 2004 to 2008; and vice president of Kmart Real Estate Strategy from 2002 to 2004. She has also served in various finance, production and management roles with Sears, Isiah Investments (investments), PricewaterhouseCoopers (professional services) and Eli Lilly & Company (pharmaceutical). Ms. Merriwether served on the board of Sears Canada from 2007 to 2010.
Qualifications: Ms. Merriwether has broad-based and deep management experience in the areas of sales, international supply chain and finance, as well as significant P&L responsibilities.
Core Competencies: ● Manufacturing or Capital-Intensive Industry ● Government, Regulatory or Legal ● Finance & Capital Markets ● International Business
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ITEM 1. ELECTION OF DIRECTORS
AL MONACO
Age: 61
Director Since: 2020
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Biographical Information: Al Monaco has served as president and chief executive officer and director of Enbridge Inc. (energy infrastructure) since 2012. Mr. Monaco is a director of the American Petroleum Institute and serves on its executive and finance committees. He is also a member of the U.S. National Petroleum Council, the Business Council of Canada, the Business Council of Alberta, and the Catalyst Canada Advisory Board. Mr. Monaco holds the chartered professional accountant and certified management accountant designations.
Qualifications: Mr. Monaco has extensive experience in overseeing a large, complex, and geographically diverse organization, as well as management of capital-intensive operations, development of natural resources, technology, international operations, strategic planning and public company executive compensation.
Core Competencies: ● CEO or Equivalent Leadership Role for Large Company ● Public Company Board ● Manufacturing or Capital-Intensive Industry ● Government, Regulatory or Legal ● Environmental Management & Strategy ● Finance & Capital Markets ● International Business
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NICOLE W. PIASECKI
Age: 58
Director Since: 2003
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Biographical Information: Nicole W. Piasecki served as vice president and general manager of the Propulsion Systems Division of Boeing Commercial Airplanes (aerospace) from March 2013 to September 2017. Previously, she served as vice president of Business Development & Strategic Integration for Boeing Commercial Airplanes from 2010 to March 2013; president of Boeing Japan from 2006 to 2010; vice president of Business Strategy & Marketing for Boeing Commercial Airplanes from 2003 to 2006; vice president of Sales, Leasing Companies, for Boeing Commercial Airplanes from 2000 until January 2003; and served in various positions in engineering, sales, marketing, and business strategy for the Commercial Aircraft Group since 1992. Ms. Piasecki also serves on the board of directors of BAE Systems PLC (defense and aerospace) and Howmet Aerospace Inc. (aerospace manufacturing). She is the chair of the board of trustees of Seattle University in Seattle, Washington and a member of the board of directors of The Stimson Center. Ms. Piasecki is a former director on the Seattle Branch board of directors for the Federal Reserve Bank, and a former member of the board of governors, Tokyo, of the American Chamber of Commerce of Japan, and the Federal Aviation Administrations Advisory Council.
Qualifications: Ms. Piasecki has extensive executive experience in capital-intensive industries, sales and marketing, strategic planning and international operations and relations.
Core Competencies: ● Public Company Board ● Timber, Land Management or Real Estate ● Manufacturing or Capital-Intensive Industry ● Government, Regulatory or Legal ● Environmental Management & Strategy ● International Business
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2021 ANNUAL MEETING & PROXY STATEMENT
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ITEM 1. ELECTION OF DIRECTORS
LAWRENCE A. SELZER
Age: 61
Director Since: 2016
|
Biographical Information: Lawrence A. Selzer has served as the president and chief executive officer of The Conservation Fund (one of the nations premier environmental non-profit organizations) since 2001. He is the chairman of the board of directors of American Bird Conservancy and a member of the board of trustees of Manomet. He previously served on the board of directors of Plum Creek Timber Company, Inc. (timber) until February 2016 and as chairman of the board of directors of Outdoor Foundation from 2007 until 2016.
Qualifications: Mr. Selzer has experience and expertise in the areas of conservation procurement, conservation finance, timberland acquisitions and dispositions, and real estate management. He has experience managing and overseeing a large, complex, and geographically diverse environmental conservation organization.
Core Competencies: ● CEO or Equivalent Leadership Role for Large Company ● Public Company Board ● Timber, Land Management or Real Estate ● Government, Regulatory or Legal ● Environmental Management & Strategy ● Finance & Capital Markets
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DEVIN W. STOCKFISH
Age: 47
Director Since: 2019
|
Biographical Information: Devin W. Stockfish has been president and chief executive officer since January 2019. Previously he served as the companys senior vice president, Timberlands from January 2018 to December 2018, and as vice president, Western Timberlands from January 2017 to December 2017. He also served as the companys senior vice president, general counsel and corporate secretary from July 2014 to December 2016, and as assistant general counsel from March 2013 to July 2014. Before joining the company, he was vice president and associate general counsel at Univar Inc. (chemical distribution), where he focused on mergers and acquisitions, corporate governance and securities law. Previously, he was an attorney in the law department at Starbucks Corporation (retail food and beverage) and practiced corporate law at K&L Gates LLP (law firm). Before he began practicing law, he was an engineer with The Boeing Company (aerospace and defense). Mr. Stockfish serves on the board of the National Alliance of Forest Owners.
Qualifications: Mr. Stockfish has experience in the forest products industry, capital-intensive industries, corporate finance, executive compensation, legal and regulatory matters and strategic planning.
Core Competencies: ● CEO or Equivalent Leadership Role for Large Company ● Timber, Land Management or Real Estate ● Manufacturing or Capital-Intensive Industry ● Government, Regulatory or Legal ● Environmental Management & Strategy ● Finance & Capital Markets ● International Business
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ITEM 1. ELECTION OF DIRECTORS
KIM WILLIAMS
Age: 65
Director Since: 2006
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Biographical Information: Kim Williams served as senior vice president and associate director of global industry research for Wellington Management Company LLP (investment management) from 2001 to 2005, was elected a partner effective in 1995 and held various management positions with Wellington from 1986 to 2001. Prior to joining Wellington, she served as vice president, industry analyst for Loomis, Sayles & Co., Inc. (investment management) from 1982 to 1986. She is also a director of E.W. Scripps Company (diverse media), Xcel Energy Inc. (utilities), and MicroVest (asset management firm). She is a member of the Womens Health Leadership Council of Brigham and Womens Hospital in Boston, Massachusetts, a member of the board of Oxfam America (global antipoverty agency) and a life trustee of Concord Academy.
Qualifications: Ms. Williams has extensive experience in corporate finance, strategic planning and international operations.
Core Competencies: ● Public Company Board ● Manufacturing or Capital-Intensive Industry ● Finance & Capital Markets ● International Business
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2021 ANNUAL MEETING & PROXY STATEMENT
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ITEM 1. ELECTION OF DIRECTORS
BOARD AND COMMITTEE MEETINGS IN 2020
The following table summarizes meeting information for the board and each of the boards committees in 2020. Directors attended 99% of total board and committee meetings in 2020, and each of the directors attended at least 75% of the total meetings of the board and the committees on which he or she served.
Name |
Board of Directors |
Executive | Audit | Compensation | Governance and Corporate | |||||
Total meetings in 2020
|
6 |
|
8 |
4 |
3 |
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ITEM 1. ELECTION OF DIRECTORS
2021 ANNUAL MEETING & PROXY STATEMENT
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EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
This Compensation Discussion and Analysis describes our executive compensation philosophy and practices and the material elements comprising our compensation program. It also explains the process that the Compensation Committee uses to determine compensation and benefits for our named executive officers, or NEOs. For 2020, our NEOs are:
Name
|
Title
| |
Devin W. Stockfish |
President and Chief Executive Officer | |
Russell S. Hagen |
Senior Vice President and Chief Financial Officer | |
Adrian M. Blocker |
Senior Vice President, Timberlands | |
James A. Kilberg |
Senior Vice President, Real Estate, Energy & Natural Resources | |
Keith J. ORear |
Senior Vice President, Wood Products |
Executive Compensation Philosophy and Practices
Our executive compensation program is designed to provide a market-competitive pay opportunity that ensures we attract and retain top talent, with pay directly linked to the achievement of short- and long-term business results. The Compensation Committee reviews our executive compensation program components, targets and payouts on an annual basis, and considers feedback we receive from our shareholders, to ensure that compensation is appropriately linked to performance against company strategy and aligned with the interests of our shareholders.
We achieve our objectives through an executive compensation program that:
● | Offers competitive pay opportunity that allows us to attract and retain top talent; |
● | Emphasizes pay-for-performance that drives superior financial results and value creation; |
● | Provides strong alignment with the interests of our shareholders; and |
● | Mitigates unnecessary and excessive risk-taking. |
Program Structure and Practices
The structure and components of our executive compensation program provide a balanced focus on both long-term strategic and financial objectives and shorter-term business objectives.
CEO COMPENSATION MIX | NEO COMPENSATION MIX | |
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EXECUTIVE COMPENSATION
Our leading compensation practices include:
● No employment agreements;
● No tax gross ups for golden parachute excise taxes;
● A clawback policy for incentive compensation recovery;
● Annual review of compensation risks and peer compensation data;
● Significant weighting of pay tied to performance-based compensation;
● No executive perquisites other than limited relocation-related benefits and, when necessary, security services;
● Significant portion of compensation in the form of equity awards with multi-year vesting; |
● A policy prohibiting hedging and pledging of company stock by directors and officers;
● Rigorous and measurable goal setting aligned with business strategy, including ESG-related goals;
● Robust stock ownership requirements for the CEO (6x salary) and senior vice presidents (2x salary);
● An independent compensation consultant, FW Cook, to advise the Compensation Committee;
● Double trigger accelerated vesting of our long-term incentive equity awards upon a change in control; and
● Balanced focus on both long-term strategic and financial objectives and shorter-term business objectives.
| |
| ||
|
Recent Changes
The Compensation Committee reviews our executive compensation program throughout the year. Feedback from shareholders, benchmarking data and input from FW Cook, and changes in market practice all have informed the committees decisions to make several changes to the compensation program for our executive officers. Following is a list of some of those recent changes:
Formalized PSU vesting cap for negative absolute TSR
Lowered maximum potential AIP bonus to 2x target
Reduced non-CEO change in control benefit multiple from 3x to 2x
|
COVID-19 executive compensation reductions
Increased disclosure of controllable business metrics portion of AIP performance goals
Revised TSR comparator group to include an expanded PSU Industry peer group | |
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2020 Compensation Highlights
For 2020, our business and operating results drove key performance metrics in the variable elements of our compensation program, reflecting our emphasis on pay-for-performance. Below is a summary of how we performed against our short-term incentive goals under our Annual Incentive Plan (AIP) and how we performed against our long-term incentive goals under our Performance Share Unit plan. Bonus amounts for each NEO under our AIP are subject to further adjustment based on individual performance. Bonus amounts for our CEO and CFO are based on the weighted performance of all three of our business segments. For more information about these plans, see the discussion under Short-Term Incentive Plan on page 42 and Long-Term Incentive Compensation Performance Share Unit Awards on page 47.
2020 Annual Incentive Plan Payout
X% of Target Payout X% of Target Payout TIMBERLANDS $851 Million* Adj. EBITDA Financial Performance Metric High Achieves Controllable Business Metrics Rating X% of Target Payout $851 Million* Adj. EBITDA Financial Performance Metric Exceeds Controllable Business Metrics Rating 58.6% RONA Financial Performance Metric High Achieves Controllable Business Metrics Rating REAL ESTATE WOOD PRODUCTS
* | The funding multiples for Timberlands and Real Estate, Energy & Natural Resources are based on a combined Adjusted EBITDA of $851 million, which is comprised of Adjusted EBITDA of $610 million for Timberlands and $241 million for Real Estate, Energy & Natural Resources. |
2020 Performance Share Unit Equity Award Payout
2020 Say-on-Pay Results
Shareholders communicated overall strong support of our compensation philosophy and programs with say-on-pay voting results in excess of 95% approval in 2020. Our Compensation Committee and board of directors value the opinions of our shareholders and consider those opinions as key inputs when making compensation decisions. Historically, we have received very strong shareholder support for our compensation program. In addition to our regular shareholder engagement throughout the year, to the extent we were to receive a significant vote against the compensation of our named executive officers we would engage in vigorous shareholder outreach and consider our shareholders feedback and concerns. The Compensation Committee would then evaluate whether responsive actions were necessary and implement any needed changes. |
2021 ANNUAL MEETING & PROXY STATEMENT
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EXECUTIVE COMPENSATION
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EXECUTIVE COMPENSATION
Pay-for-Performance
Our compensation program is designed to reflect a strong focus on pay-for-performance approach that drives superior financial results and value creation and strongly aligns our executives interests with those of our shareholders.
We tie pay to performance by: | ||
● Structuring a significant portion (60% for CEO, 55% for other NEOs) of our executives pay as performance-based compensation;
● Evaluating performance against rigorous, pre-set performance goals;
● Using performance to differentiate the amount of incentive compensation and allocate more compensation to higher-performing businesses and employees; and
● Exercising negative discretion to reduce incentive compensation otherwise payable upon achievement of pre-set goals to adjust for negative business occurrences. |
CEO PERFORMANCE-BASED COMPENSATION 40% 60% Performance-Based All Other Compensation | |
2021 ANNUAL MEETING & PROXY STATEMENT
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EXECUTIVE COMPENSATION
TOTAL COMPENSATION - GRANTED VS. REALIZED 1 2016 2020 Granted 2020 Realized Granted 2016 Realized Granted 2017 Realized Granted 2018 Realized Granted 2019 Realized
* | Granted compensation includes: (i) base salary established for the calendar year; (ii) earned AIP awards based on actual business funding multiples but not including individual modifiers; (iii) the grant date fair value of RSU awards; and (iv) the grant date fair value of PSU awards. |
Realized | compensation for the years presented includes (i) base salary received during the calendar year; (ii) earned AIP awards, including individual adjustment modifiers; (iii) the value of vested and unvested RSU awards; (iv) for the years 2016, 2017 and 2018, the value of vested PSU awards and for the years 2019 and 2020, the value of unvested PSU awards; and (v) amounts set forth under the All Other Compensation column of the Summary Compensation Table. Values for vested RSUs were calculated by multiplying RSU units by the company stock price on the vesting date. Values for unvested RSUs were calculated by multiplying RSU units by the company stock price on December 31, 2020. Values for vested PSU awards were calculated by multiplying (a) the actual number of earned award shares based on actual TSR for the performance period by (b) the company stock price on the vesting date. Values for unvested PSU awards were calculated by multiplying (a) the number of award shares that would be earned based on TSR through December 31, 2020 by (b) the company stock price on December 31, 2020. |
For both Granted and Realized compensation, amounts set forth in the Summary Compensation Table under the Change in Pension Value and Nonqualified Deferred Compensation Earnings column are not included.
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EXECUTIVE COMPENSATION
Strong Alignment with Shareholders
Our compensation program is also designed to reflect a strong alignment with the interests of our shareholders, which we believe is a key component of a successful executive compensation program. We achieve this alignment by structuring our program and policies so that:
● A significant
portion (72% for CEO; 60% for other NEOs) of our
● Our PSU awards, which account for 60% of the equity awards for our executives, are tied to a 3-year relative TSR measure; and
● Our stock
ownership requirements ensure that our executives hold a significant amount of our stock (6x salary for our CEO and 2x |
CEO EQUITY COMPENSATION MIX 26% 74% Equity Compensation Other Compensation | |||
2021 ANNUAL MEETING & PROXY STATEMENT
|
39
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EXECUTIVE COMPENSATION
40
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EXECUTIVE COMPENSATION
To provide a competitive overall compensation and benefits package that is tied to creating shareholder value and that supports the execution of our business strategies throughout the business cycle, we use a range of compensation components. The combination and the amount of each component are influenced by our compensation goals, market data, the role of the executive in the company, and the total value of all the compensation and benefits available to the executive. The following is a summary of our 2020 executive officer compensation program:
Element | Objectives and Basis | |
Base salary |
Provide fixed compensation within the median market range. | |
Annual cash incentives |
Provide annual cash incentive opportunity within the median market range to drive short-term company and business unit performance. | |
Long-term incentives Performance Share Units |
Provide long-term incentive opportunity within the median market range to drive company performance and align executive and shareholder interests over a three-year performance period. | |
Long-term incentives Restricted Stock Units |
Provide long-term incentive opportunity within the median market range to align executive and shareholder interests and retain top executive talent through long-term equity vesting. | |
Retirement benefits |
Provide retirement benefits within the median market range. | |
Deferred compensation benefits |
Allow executives to defer the receipt of compensation and related income inclusion for income tax purposes. | |
Medical and other benefits |
Provide benefits package within the median market range comprised of benefits offered to all employees. |
Base salary is the principal fixed element of executive compensation. In setting base salaries for executives, our Compensation Committee generally targets base salary to be within the median market range based on data from both the peer group companies previously described and general industry executive surveys for the applicable executive role. We also consider other factors to allow us to meet our objective of attracting and retaining top talent, such as the companys performance, relative pay among executives, the executives individual performance, and his or her experience. The Compensation Committee reviews executive salaries on an annual basis.
Following are the base salaries for our NEOs as set by the Compensation Committee in February 2020. The changes from 2019 base salaries were made by the Committee to bring base salaries for each NEO within the median market range. As discussed previously in this proxy statement, members of the senior management team, including the NEOs, voluntarily reduced their base salaries in light of the COVID-19 pandemic. These salary reductions included a 30% reduction for Devin Stockfish and a 10% reduction for each of the other NEOs. The effect of these reductions is not reflected in the table below but is reflected in the amounts reported and set forth in the Summary Compensation Table.
Named Executive Officer |
Base Salary | ||||
Devin W. Stockfish |
$ | 1,100,000 | |||
Russell S. Hagen |
$ | 625,000 | |||
Adrian M. Blocker |
$ | 630,000 | |||
James A. Kilberg |
$ | 570,000 | |||
Keith J. ORear |
$ | 620,000 |
(1) | These amounts do not reflect the COVID-19 salary reductions discussed above, which were in effect from May 15, 2020 through November 1, 2020. The reduced base salary for each NEO is set forth in the Summary Compensation Table. |
2021 ANNUAL MEETING & PROXY STATEMENT
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41
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EXECUTIVE COMPENSATION
For 2020, the Compensation Committee set a combined Adjusted EBITDA target for the Timberlands and Real Estate, Energy & Natural Resources businesses and a Return on Net Assets target (RONA) for the Wood Products business at the target levels set forth below. The financial metric target for the Timberlands and Real Estate, Energy & Natural Resources businesses was lowered in 2020 from the 2019 target level primarily because of slightly lower planned harvest volumes and the sales of the companys Michigan and Montana timberland assets, which were completed in 2019 and early 2020 respectively.
Metric
|
Threshold Target Funding)
|
Target Target Funding)
|
Maximum (200% of
|
|||||||||||||
Timberlands and Real Estate, Energy & Natural Resources |
Adjusted EBITDA | $606 million | $865 million | $1,081 million | ||||||||||||
Wood Products |
RONA | 12% | 22% | 30% |
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EXECUTIVE COMPENSATION
2021 ANNUAL MEETING & PROXY STATEMENT
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43
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EXECUTIVE COMPENSATION
Following is a description of the operational excellence (OpX 2.0) and human capital management goals that comprised the controllable business metrics portion of our 2020 AIP. Results are presented for each business segment.
TIMBERLANDS (85% Weighting) REAL ESTATE & ENR (85% Weighting) WOOD PRODUCTS (85% Weighting) ALL BUSINESS SEGMENTS (15% Weighting) Operational (Target Performance) Margin Improvement ($25 - $35 million) Cost Avoidance (2 - 4 Significant Opportunities) Efficiency (1-2 Scale Process Improvements) Cross-Business OpX ($1 - $3 million) Future Value (25%-49% gap closure against best-in-class silviculture/forestry benchmarks) Sustainability Maintain 100% Certification to Sustainable Forestry Practices Operational (Target Performance) RE Margin > Timber NPV (35% - 45%) Lease Rate Increase (3.5% - 4.0%) Value Based Pricing (900 - 1,100 Parcels) Reduce Listing Cycle Time (By 8 - 10 Days) Human Capital Management Goals relating to succession planning, critical role placement and leadership development. Results Exceeds ($43 million) Exceeds (7 Opportunities) Exceeds (4 Improvements) Exceeds ($13 million) High Achieves (42%) Achieves Maintained Certification with Zero Non-Conformities Results Exceeds (80%) Exceeds (4.3%) Exceeds (1,197 Parcels) Exceeds (Reduced By 24 Days) Operational (Target Performance) Margin Improvement ($25 - $40 million) Future Value (3.2 - 3.6 Average Reliability Scores) Cost Avoidance (2 - 4 Significant Opportunities) Efficiency (1-2 Scale Process Improvements) Cross-Business OpX ($1 - $3 million) Results Exceeds ($50 million) High Achieves (3.56) Exceeds (6 Opportunities) Exceeds (3 Improvements) Exceeds ($13 million) Results Exceeds
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EXECUTIVE COMPENSATION
Individual AIP awards are calculated as follows:
AIP Funding for 2020
For 2020, AIP funding multiples were as follows:
FINANCIAL PERFORMANCE METRICS | CONTROLLABLE BUSINESS METRICS | |||||||||||
Business (Financial Measure)
|
2020 Results
|
Funding
|
2020 Metrics Results
|
Funding
|
2020 Total Business Funding Multiple (A+B)
| |||||||
Timberlands (1)
|
$851 million |
0.57 |
|
High Achieves |
0.76 |
1.33 | ||||||
Real Estate, Energy & Natural Resources (1)
|
$851 million | 0.57 |
|
Exceeds | 0.80 | 1.37 | ||||||
Wood Products (2)
|
58.6% | 1.20 |
|
High Achieves | 0.78 | 1.98 | ||||||
Corporate Funding (3)
|
N/A | 0.82 |
|
N/A | 0.78 | 1.60 |
(1) | Based on a combined Adjusted EBITDA for Timberlands and Real Estate, Energy & Natural Resources. |
(2) | Based on segment RONA. |
(3) | Based on performance of Timberlands, Real Estate, Energy & Natural Resources, and Wood Products, weighted for each segment at 40%, 20% and 40%, respectively. |
2021 ANNUAL MEETING & PROXY STATEMENT
|
45
|
EXECUTIVE COMPENSATION
AIP bonus targets and actual payout amounts for our NEOs in 2020 were:
Named Executive Officer
|
Target Bonus (% of Base Salary)
|
Target Bonus Amount ($)
|
Business Funding Multiple
|
2020 Bonus Earned ($)
|
2020 Bonus (% of Target)
|
|||||||||||||||
Devin W. Stockfish Corporate
|
150% | $ | 1,650,000 | 1.60 | $ | 2,640,000 | 160% | |||||||||||||
Russell S. Hagen Corporate
|
95% | $ | 593,750 | 1.60 | $ | 1,000,000 | 168% | |||||||||||||
Adrian M. Blocker Timberlands
|
95% | $ | 598,500 | 1.33 | $ | 880,000 | 147% | |||||||||||||
James A. Kilberg Real Estate, Energy & Natural Resources
|
95% | $ | 541,500 | 1.37 | $ | 820,000 | 151% | |||||||||||||
Keith J. ORear Wood Products |
95% | $ | 589,000 | 1.98 | $ | 1,178,000 | 200% |
The AIP bonus for each of Messrs. Stockfish, Hagen, Blocker, Kilberg and ORear was above target because the business funding multiple applicable to their respective AIP opportunities exceeded target based on business performance. The 2020 business funding multiple for Mr. Blocker was 1.33 based on the performance of the Timberlands segment. Additionally, the Compensation Committee recognized Mr. Blockers leadership and attention to safety and budget management during in a year with significant challenges presented by the COVID-19 pandemic and severe fires on our Oregon timberlands. The 2020 business funding multiple for Mr. Kilberg was 1.37 based on the performance of the Real Estate, Energy & Natural Resources segment. The committee also recognized Mr. Kilbergs leadership in the segments operational excellence results achieved in the context of a difficult business environment. The 2020 business funding multiple for Mr. ORear was 1.98 based on the performance of the Wood Products segment. The committee recognized the segments excellent operating results as well as Mr. ORears significant leadership in safely achieving record-low cost structure in the Wood Products lumber business. The 2020 funding multiple for Messrs. Stockfish and Hagen was 1.60 based on the performance of the Timberlands, Real Estate, Energy & Natural Resources and Wood Products segments. Additionally, for Mr. Hagen, the committee recognized his exceptional leadership in response to the COVID-19 pandemic while also managing significant land transactions and decreasing the companys pension liability through strategic annuity purchase transactions. Notwithstanding the committees and boards recognition of Mr. Stockfishs exceptional leadership of the company through the many challenges presented during 2020, Mr. Stockfish requested, and the committee approved, that there be no individual adjustment to his bonus.
46
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
equity grants for the executive that are effective upon the later of (i) the officers start date or the effective date of the promotion or (ii) the date the grant is approved by the Compensation Committee.
The Compensation Committees February meeting date was the effective grant date for the 2020 annual equity grants to the NEOs other than Mr. Stockfish. Equity grants to Mr. Stockfish were made on the day following the Compensation Committee meeting at the meeting of the full board.
Total Long-Term Incentive Compensation Grants
The Compensation Committee established a target level of long-term incentives for each NEO relative to the median of competitive market long-term incentive levels. For 2020, the target long-term incentive values for the NEOs were:
Named Executive Officer
|
2020 Target Long-Term Incentive Value (1) |
|||
Devin W. Stockfish
|
$7,000,000 | |||
Russell S. Hagen
|
$1,850,000 | |||
Adrian M. Blocker
|
$1,875,000 | |||
James A. Kilberg
|
$1,725,000 | |||
Keith J. ORear |
$1,825,000 |
(1) | These amounts reflect the approved target value of long-term incentive compensation granted to each NEO in 2020. The actual grant-date fair values of these grants, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, are shown in the Summary Compensation Table on page 51 and the Grants of Plan-Based Awards for 2020 table on page 53. |
For 2020, 60% of the target value of the long-term incentive awards were granted in the form of PSUs and 40% of the value of the long-term incentive awards were granted in the form of RSUs.
PERFORMANCE SHARE UNITS
60% |
RESTRICTED STOCK UNITS
40% | |||||
● Tied to achievement of long-term performance
● Facilitates share ownership
● Alignment with shareholders
● Strong retention vehicle |
Shares earned will range from 0% to 150% of the target number of PSUs based on the companys 3-year TSR performance relative to a designated Industry peer group. |
● Alignment with shareholders
● Facilitates share ownership
● Strong retention vehicle | ||||
2021 ANNUAL MEETING & PROXY STATEMENT
|
47
|
EXECUTIVE COMPENSATION
48
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
2021 ANNUAL MEETING & PROXY STATEMENT
|
49
|
EXECUTIVE COMPENSATION
50
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
The following tables set forth information regarding 2020 compensation for each of our 2020 NEOs. Compensation for 2019 and 2018 is presented for the executive officers who were NEOs in 2019 and 2018. The Summary Compensation Table and the Grants of Plan-Based Awards for 2020 Table should be reviewed together for a more complete presentation of both the annual and long-term incentive compensation elements of our compensation program. Messrs. Hagen and Kilberg are presented throughout this section with the position titles they held during 2020. In 2021, Mr. Hagen moved to a new executive role with Weyerhaeuser, and Mr. Kilberg retired from the company.
Name and Principal Position
|
Year
|
Salary (1) ($)
|
Bonus ($)
|
Stock Awards (2) ($)
|
Non-Equity Compensation (3) ($)
|
Change in Pension Value and Nonqualified Deferred Compensation Earnings (4) ($)
|
All Other Compensation (5) ($)
|
Total ($)
| ||||||||||||||||||||||||||||||||
Devin W. Stockfish
President and Chief
Executive Officer
|
|
2020
2019
2018
|
|
|
959,885
981,808
568,077
|
|
|
|
|
|
6,942,865
6,984,904
1,648,415
|
|
|
2,640,000
1,635,000
677,160
|
|
|
581,691
347,056
78,184
|
|
|
34,628
8,400
8,250
|
|
|
11,159,069
9,957,168
2,980,086
|
| ||||||||||||||||
Russell S. Hagen
Senior Vice President
and Chief Financial
Officer
|
|
2020
2019
2018
|
|
|
611,298
587,789
570,000
|
|
|
|
|
|
1,848,429
1,834,409
1,648,415
|
|
|
1,000,000
585,000
750,000
|
|
|
523,988
603,574
|
|
|
68,365
82,362
95,424
|
|
|
4,052,080
3,693,134
3,063,839
|
| ||||||||||||||||
Adrian M. Blocker
Senior Vice President,
Timberlands
|
|
2020
2019
2018
|
|
|
623,469
622,673
570,000
|
|
|
|
|
|
1,873,418
1,834,409
3,648,408
|
|
|
880,000
520,000
821,000
|
|
|
369,529
381,294
211,249
|
|
|
8,550
8,400
8,250
|
|
|
3,754,966
3,366,776
5,258,907
|
| ||||||||||||||||
James A. Kilberg
Senior Vice President,
Real Estate, Energy &
Natural Resources
|
|
2020
2019
2018
|
|
|
562,512
557,115
547,692
|
|
|
|
|
|
1,723,554
1,685,663
1,551,441
|
|
|
820,000
500,000
675,000
|
|
|
34,816
41,671
32,003
|
|
|
61,676
76,806
84,581
|
|
|
3,202,558
2,861,255
2,890,717
|
| ||||||||||||||||
Keith J. ORear
Senior Vice President,
Wood Products
|
|
2020
2019
|
|
|
597,685
547,731
|
|
|
|
|
|
1,823,441
1,735,226
|
|
|
1,178,000
675,000
|
|
|
1,793,886
972,051
|
|
|
8,550
65,788
|
|
|
5,401,562
3,995,796
|
|
(1) | Amounts reflect the dollar amount of base salary paid in cash in the fiscal year and the salary reductions elected by all members of the senior management team, including NEOs, in response to the COVID-19 pandemic. Additional information is provided in Base Salary on page 41. |
(2) | Amounts reflect the grant date fair value of RSU and PSU awards granted under the companys long-term incentive plans computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718. Details regarding 2020 stock awards can be found in the table Grants of Plan-Based Awards for 2020. Details regarding outstanding stock awards can be found in the table Outstanding Equity Awards At 2020 Fiscal Year End. For more information regarding these awards and the calculation of their fair value, refer to the companys disclosure in its Annual Report for the year ended December 31, 2020, Part II, Item 8, Notes to Consolidated Financial StatementsNote 16 Share-Based Compensation. Assuming the highest level of performance is achieved (which would result in the vesting of 150% of the PSUs granted), the aggregate grant date fair value of PSUs set forth in the Stock Awards column above would be: Mr. Stockfish: $6,214,317; Mr. Hagen: $1,662,510; Mr. Blocker: $1,684,992; Mr. Kilberg: $1,550,197; and Mr. ORear: $1,640,027. |
(3) | Amounts represent the value of the annual cash incentive awards earned under the companys AIP based on the companys performance and the performance of the companys businesses and individual NEOs against pre-set performance goals. These performance goals are described in Compensation Discussion and Analysis Compensation Program Design Short-Term Incentive Plan above. |
(4) | Amounts represent annual changes in the actuarial present value of accumulated pension benefits. |
(5) | Amounts under All Other Compensation for each of the NEOs are described in the following table: |
2021 ANNUAL MEETING & PROXY STATEMENT
|
51
|
EXECUTIVE COMPENSATION
Summary Compensation Table All Other Compensation
Name
|
Year
|
Company Contribution Contribution Plan ($)
|
Other ($)
|
Total
|
||||||||||
Devin W. Stockfish |
|
2020
2019
2018
|
|
8,550
8,400
8,250
|
|
26,078
|
|
|
34,628
8,400
8,250
|
(1)
| ||||
Russell S. Hagen |
|
2020
2019
2018
|
|
68,365(1)
75,290
78,000
|
|
7,072
17,424
|
|
|
68,365
82,362
95,424
|
| ||||
Adrian M. Blocker |
|
2020
2019
2018
|
|
8,550
8,400
8,250
|
|
|
|
|
8,550
8,400
8,250
|
| ||||
James A. Kilberg |
|
2020
2019
2018
|
|
61,676(1)
70,006
67,685
|
|
6,800
16,896
|
|
|
61,676
76,806
84,581
|
| ||||
Keith J. ORear
|
|
2020
2019
|
|
8,550
8,400
|
|
57,388
|
|
|
8,550
65,788
|
|
(1) | For Mr. Hagen, amount includes a non-elective company contribution of $14,250 and matching contribution of $8,550 to the 401(k) Plan and a non-elective company contribution of $45,565 to the Supplemental DC Plan. For Mr. Kilberg, amount includes a non-elective contribution of $14,250 and matching contribution of $8,550 to the 401(k) Plan and a non-elective contribution of $38,876 to the Supplemental DC Plan. See discussion under Compensation Discussion and Analysis Other Benefits Supplemental Retirement Plan and Supplemental DC Plan for more information. For Mr. Stockfish, amount includes $26,078 for home security services in 2020. |
52
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
Grants of Plan-Based Awards for 2020
The following table provides information for each of our NEOs regarding 2020 annual and long-term incentive award opportunities, including the range of potential payouts under non-equity and equity incentive plans. Specifically, the table presents the 2020 grants of AIP, PSU and RSU awards. No option awards were granted in 2020.
Estimated Future Payouts Under Non-Equity Plan Awards(2) |
Estimated Future Payouts Under Equity Plan Awards(2) |
|||||||||||||||||||||||||||||||||||||
Name
|
Type
|
Grant
|
Threshold ($)
|
Target ($)
|
Maximum
|
Threshold (#)
|
Target (#)
|
Maximum
|
Stock (#) (3)
|
Grant Date Fair ($) (4)
|
||||||||||||||||||||||||||||
Devin W. Stockfish |
AIP
|
|
2/14/2020
|
|
|
330,000
|
|
|
1,650,000
|
|
|
3,300,000
|
|
|||||||||||||||||||||||||
PSU
|
|
2/14/2020
|
|
|
62,468
|
|
|
124,936
|
|
|
187,404
|
|
|
4,142,878
|
| |||||||||||||||||||||||
RSU
|
|
2/14/2020
|
|
|
92,120
|
|
|
2,799,987
|
| |||||||||||||||||||||||||||||
Russell S. Hagen
|
AIP
|
|
2/13/2020
|
|
|
118,750
|
|
|
593,750
|
|
|
1,187,500
|
|
|||||||||||||||||||||||||
PSU
|
|
2/13/2020
|
|
|
16,712
|
|
|
33,424
|
|
|
50,136
|
|
|
1,108,340
|
| |||||||||||||||||||||||
RSU
|
|
2/13/2020
|
|
|
24,645
|
|
|
740,089
|
| |||||||||||||||||||||||||||||
Adrian M. Blocker
|
AIP
|
|
2/13/2020
|
|
|
119,700
|
|
|
598,500
|
|
|
1,197,000
|
|
|||||||||||||||||||||||||
PSU
|
|
2/13/2020
|
|
|
16,938
|
|
|
33,876
|
|
|
50,814
|
|
|
1,123,328
|
| |||||||||||||||||||||||
RSU
|
|
2/13/2020
|
|
|
24,978
|
|
|
750,089
|
| |||||||||||||||||||||||||||||
James A. Kilberg
|
AIP
|
|
2/13/2020
|
|
|
108,300
|
|
|
541,500
|
|
|
1,083,000
|
|
|||||||||||||||||||||||||
PSU
|
|
2/13/2020
|
|
|
15,583
|
|
|
31,166
|
|
|
46,749
|
|
|
1,033,465
|
| |||||||||||||||||||||||
RSU
|
|
2/13/2020
|
|
|
22,980
|
|
|
690,089
|
| |||||||||||||||||||||||||||||
Keith J. ORear
|
AIP
|
|
2/13/2020
|
|
|
117,800
|
|
|
589,000
|
|
|
1,178,000
|
|
|||||||||||||||||||||||||
PSU
|
|
2/13/2020
|
|
|
16,486
|
|
|
32,972
|
|
|
49,458
|
|
|
1,093,352
|
| |||||||||||||||||||||||
RSU
|
|
2/13/2020
|
|
|
24,312
|
|
|
730,089
|
|
(1) | The date of the Compensation Committee meeting at which long-term incentive and AIP award opportunities are approved is the effective grant date for equity plan award grants and award opportunities under the AIP to the NEOs other than the CEO. Compensation decisions for the CEO are approved by the board of directors based upon recommendations by the Compensation Committee. The effective grant date for equity plan award grants and AIP award opportunities to the CEO is therefore the date of approval by the board of directors. |
(2) | Represents the value of potential payments under the companys AIP and the number of shares that may be earned under the PSU plan. These plans and awards are described in the Short-Term Incentive Plan and Long-Term Incentive Compensation sections under Compensation Discussion and Analysis Compensation Program Design. |
(3) | Amounts represent RSUs granted under the companys long-term incentive plan. These awards are described in the Long-Term Incentive Compensation section under Compensation Discussion and Analysis Compensation Program Design. |
(4) | Amounts reflect the grant date fair value of RSU and PSU awards granted under the companys long-term incentive plan computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718. Details regarding outstanding equity awards can be found in the table Outstanding Equity Awards At 2020 Fiscal Year End. For more information regarding these awards and the calculation of their fair value, refer to companys disclosure in its Annual Report for the year ended December 31, 2020, Part II, Item 8, Notes to Consolidated Financial Statements Note 16 Share-Based Compensation. |
2021 ANNUAL MEETING & PROXY STATEMENT
|
53
|
EXECUTIVE COMPENSATION
Outstanding Equity Awards at 2020 Fiscal Year End
The following table provides information regarding outstanding stock options and unvested stock awards held by each of our NEOs as of December 31, 2020.
Option Awards | Stock Awards | ||||||||||||||||||||||||||||||||||||||||||||
Name
|
Grant Date
|
Number
of Exercisable (1)
|
Number
of Unexercisable (1)
|
Option Exercise Price ($)
|
Option Date
|
Number of Shares or Not
|
Market or Units of Stock That Have Not Vested (2)(4)
|
Equity Vested (2)(5) (#)
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units, or Other Rights that Have Not Vested (2)(5) ($)
| ||||||||||||||||||||||||||||||||||||
Devin W. Stockfish
|
|
02/12/2014
|
|
|
15,069
|
|
|
|
|
|
30.1600
|
|
|
02/12/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||
|
04/09/2014
|
|
|
18,144
|
|
|
|
|
|
28.5600
|
|
|
04/09/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/12/2015
|
|
|
39,458
|
|
|
|
|
|
35.4050
|
|
|
02/12/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/09/2016
|
|
|
90,909
|
|
|
|
|
|
23.0900
|
|
|
02/09/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,965
|
|
|
132,946
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,960
|
|
|
333,959
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,991
|
|
|
636,770
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
81,830
|
|
|
2,743,760
|
|
|
210,723
|
|
|
7,065,542
|
| |||||||||||||||||||
|
02/14/2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
92,120
|
|
|
3,088,784
|
|
|
124,936
|
|
|
4,189,104
|
| |||||||||||||||||||
Russell S. Hagen
|
|
02/07/2011
|
|
|
24,000
|
|
|
|
|
|
25.9700
|
|
|
02/07/2021
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,881
|
|
|
163,660
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,960
|
|
|
333,959
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,991
|
|
|
636,770
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/07/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,491
|
|
|
720,593
|
|
|
55,341
|
|
|
1,855,584
|
| |||||||||||||||||||
|
02/13/2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,645
|
|
|
826,347
|
|
|
33,424
|
|
|
1,120,707
|
| |||||||||||||||||||
Adrian M. Blocker
|
|
02/12/2014
|
|
|
28,486
|
|
|
|
|
|
30.1600
|
|
|
02/12/2024
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||
|
02/12/2015
|
|
|
58,149
|
|
|
|
|
|
35.4050
|
|
|
02/12/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/09/2016
|
|
|
128,099
|
|
|
|
|
|
23.0900
|
|
|
02/09/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,881
|
|
|
163,660
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,960
|
|
|
333,959
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,991
|
|
|
636,770
|
|
|
|
|
|
|
| |||||||||||||||||||
|
08/24/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
57,645
|
|
|
1,932,837
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/07/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
21,491
|
|
|
720,593
|
|
|
55,341
|
|
|
1,855,584
|
| |||||||||||||||||||
|
02/13/2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,978
|
|
|
837,512
|
|
|
33,876
|
|
|
1,135,862
|
| |||||||||||||||||||
James A. Kilberg
|
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,728
|
|
|
158,530
|
|
|
|
|
|
|
| ||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,374
|
|
|
314,310
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,873
|
|
|
599,314
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/07/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
19,749
|
|
|
662,184
|
|
|
50,853
|
|
|
1,705,101
|
| |||||||||||||||||||
|
02/13/2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,980
|
|
|
770,519
|
|
|
31,166
|
|
|
1,044,996
|
| |||||||||||||||||||
Keith J. ORear
|
|
02/12/2015
|
|
|
8,307
|
|
|
|
|
|
35.4050
|
|
|
02/12/2025
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||||||||||
|
02/09/2016
|
|
|
7,438
|
|
|
|
|
|
23.0900
|
|
|
02/09/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/09/2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
687
|
|
|
23,035
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,172
|
|
|
39,297
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/08/2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,489
|
|
|
49,941
|
|
|
|
|
|
|
| |||||||||||||||||||
|
02/07/2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,329
|
|
|
681,631
|
|
|
52,349
|
|
|
1,755,245
|
| |||||||||||||||||||
|
02/13/2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,312
|
|
|
815,181
|
|
|
32,972
|
|
|
1,105,551
|
|
54
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
(1) | All outstanding Option awards are 100% vested. Options are for a term of 10 years. The company discontinued granting stock options after 2016. |
(2) | Stock Awards represent outstanding RSUs and PSUs. RSUs granted on February 9, 2017, February 8, 2018, February 7, 2019, February 8, 2019, February 13, 2020 and February 14, 2020 vest in 25% increments over four years, beginning 12 months following the grant date. RSUs granted to Mr. Blocker on August 24, 2018 will vest entirely on December 31, 2021. PSUs granted on February 8, 2018, February 7, 2019, February 8, 2019, February 13, 2020 and February 14, 2020 are earned based on relative company performance at the end of a three-year performance period and vest entirely and become available for release on the third anniversary of the grant date. |
(3) | In accordance with SEC disclosure guidance, amounts in this column also include PSU units granted in 2018, the performance period for which was concluded on December 31, 2020, based on the actual value (69.6% of target) of the award. |
(4) | Values were computed by multiplying the market price of $33.53 for the companys common stock on December 31, 2020 by the number of units. |
(5) | Represents the estimated value of the 2019 and 2020 PSU awards as of December 31, 2020. Amounts shown are estimates calculated in accordance with SEC disclosure rules. The estimated value of the PSUs is the product of: (i) the number of unearned PSUs, multiplied by (ii) the market price of $33.53 for the companys common stock on December 31, 2020. The number of unearned PSUs for 2019 is the product of (i) target units granted, multiplied by (ii) the factor of 150% because the estimated performance as of December 31, 2020 is equal to maximum performance. The number of unearned PSUs for 2020 is the product of (i) target units granted, multiplied by (ii) the factor of 100% because the estimated performance as of December 31, 2020 is equal to target performance. |
Option Exercises and Stock Vested in 2020
The following table provides information for each of our NEOs regarding stock option exercises and vesting of stock awards during 2020. The value realized upon the exercise of options is calculated using the difference between the option exercise price and the market price at the time of exercise multiplied by the number of shares underlying the option. The value realized upon the vesting of stock awards is based on the market price of company common stock on the vesting date.
Option Awards | Stock Awards | |||||||||
Name
|
Number of (#)
|
Value Realized ($)
|
Number of (#)
|
Value Realized ($)
|
||||||
Devin W. Stockfish
|
|
|
45,485
|
|
1,299,961
|
| ||||
Russell S. Hagen
|
20,800
|
130,008
|
29,960
|
|
858,682
|
| ||||
Adrian M. Blocker
|
|
|
28,956
|
|
828,064
|
| ||||
James A. Kilberg
|
|
|
28,492
|
|
816,612
|
| ||||
Keith J. ORear
|
|
|
8,535
|
|
244,405
|
|
2021 ANNUAL MEETING & PROXY STATEMENT
|
55
|
EXECUTIVE COMPENSATION
The following table provides information as of December 31, 2020 for each of our NEOs regarding the actuarial present value of the officers total accumulated benefit under each of our applicable defined benefit plans. No payments were made under these plans to any of our NEOs during 2020.
Name
|
Plan Name
|
Years of Service earned under Formula A (1) (#)
|
Present Value of Accumulated Benefit earned under Formula A (2) ($)
|
Years of Credited Service earned under Formula B (3) (#)
|
Present Value of Accumulated Benefit earned under Formula B (4) ($)
|
Total Years of Credited Service (5) (#)
|
Total Present Value of Accumulated Benefit (6) ($)
| |||||||||||||||||||||||||
Devin W. Stockfish
|
Pension Plan
|
|
|
|
|
|
|
|
8
|
|
|
234,887
|
|
|
8
|
|
|
234,887
|
| |||||||||||||
Supplemental
|
|
|
|
|
|
|
|
8
|
|
|
1,044,913
|
|
|
8
|
|
|
1,044,913
|
| ||||||||||||||
Russell S. Hagen |
Plum Creek
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23
|
|
|
859,994
|
| |||||||||||||
Plum Creek
|
|
|
|
|
|
|
|
|
|
|
|
|
|
23
|
|
|
2,623,968
|
| ||||||||||||||
Adrian M. Blocker |
Pension Plan
|
|
|
|
|
|
|
|
8
|
|
|
343,340
|
|
|
8
|
|
|
343,340
|
| |||||||||||||
Supplemental
|
|
|
|
|
|
|
|
8
|
|
|
1,211,172
|
|
|
8
|
|
|
1,211,172
|
| ||||||||||||||
James A. Kilberg |
Plum Creek
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12
|
|
|
327,272
|
| |||||||||||||
Plum Creek
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12
|
|
|
719,893
|
| ||||||||||||||
Keith J. ORear |
Pension Plan
|
|
21
|
|
|
1,333,364
|
|
|
11
|
|
|
423,541
|
|
|
32
|
|
|
1,756,905
|
| |||||||||||||
Supplemental
|
|
21
|
|
|
1,804,395
|
|
|
11
|
|
|
569,718
|
|
|
32
|
|
|
2,374,113
|
|
(1) | Number of years of credited service as of December 31, 2009 rounded to the nearest whole year of credited service. These years of service are used for calculating Formula A accrued benefit only. |
(2) | Actuarial present value of accumulated benefit computed as of the same pension plan measurement date used for financial reporting purposes under Financial Accounting Standards Board Accounting Standards Codification Topic 715 with respect to the companys audited financial statements for fiscal year 2020, using age 62, which is the earliest unreduced retirement age for the portion of the benefit earned under Formula A, or Executives actual age if greater. Estimates are based on current compensation and years of service. |
(3) | Number of years of credited service computed beginning on January 1, 2010 and ending as of the same pension plan measurement date used for financial reporting purposes under Financial Accounting Standards Board Accounting Standards Codification Topic 715 with respect to the companys audited financial statements for fiscal year 2020 rounded to the nearest whole year of credited service. These years of service are used for calculating Formula B accrued benefits only. |
(4) | Actuarial present value of accumulated benefit computed as of the same pension plan measurement date used for financial reporting purposes under Financial Accounting Standards Board Accounting Standards Codification Topic 715 with respect to the companys audited financial statements for fiscal year 2020, calculated using age 65, which is the earliest unreduced retirement age for the portion of the benefit earned under Formula B, or the executives actual age if greater. Estimates are based on current compensation and years of service. |
(5) | Includes years of credited service with Plum Creek Timber Company, Inc. for Messrs. Hagen and Kilberg. |
(6) | Actuarial present value of accumulated benefit computed as of the same pension plan measurement date used for financial reporting purposes under Financial Accounting Standards Board Accounting Standards Codification Topic 715 with respect to the companys audited financial statements for fiscal year 2020. For former Plum Creek executives using age 62, which is the earliest unreduced retirement age for the portion of the benefit earned under their respective plans, or the executives actual age if greater. Estimates are based on current compensation and years of service. |
56
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
2021 ANNUAL MEETING & PROXY STATEMENT
|
57
|
EXECUTIVE COMPENSATION
Non-Qualified Deferred Compensation
The following table provides information for each of our NEOs regarding aggregate executive and company contributions, aggregate earnings for 2020 and year end account balances under the companys deferred compensation plan.
Name
|
Executive ($)
|
Registrant ($)
|
Aggregate ($)
|
Aggregate Distributions ($)
|
Aggregate ($)
| ||||||||||||||||||||
Devin W. Stockfish
|
|
408,750
|
|
|
|
|
|
21,735
|
|
|
|
|
|
891,584
|
| ||||||||||
Russell S. Hagen
|
|
585,000
|
|
|
45,565
|
|
|
106,830
|
|
|
|
|
|
2,310,114
|
| ||||||||||
Adrian M. Blocker
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||||
James A. Kilberg
|
|
|
|
|
38,876
|
|
|
41,993
|
|
|
|
|
|
247,603
|
| ||||||||||
Keith J. ORear
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Amounts are also reported in the Summary Compensation Table as salary earned and paid in 2020. |
(2) | Amounts reported in this column represent non-elective employer contributions under the Supplemental Defined Contribution Plan. These amounts are also reported in the Summary Compensation Table under All Other Compensation. |
(3) | Fiscal 2020 earnings, which includes interest on amounts deferred into the fixed interest account of the deferral plan and appreciation or depreciation in the price of common stock equivalent units, plus dividend equivalents for amounts deferred in the common stock equivalents account in the deferral plan. |
(4) | Amounts were also reported as compensation in the Summary Compensation Table for previous years, and include interest earned on amounts deferred into the fixed-interest account of the deferral plan, any premium for amounts deferred into the common stock equivalents account in the deferral plan, and appreciation or depreciation in the price of common stock equivalent units, plus dividend equivalents for amounts deferred into the common stock equivalents account in the deferral plan. |
58
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
2021 ANNUAL MEETING & PROXY STATEMENT
|
59
|
EXECUTIVE COMPENSATION
The following tables describe estimated potential payments to the NEOs that could be made upon a change in control with a qualifying termination or upon an involuntary termination other than for Cause, in each case as if the event had occurred on December 31, 2020. Valuation of equity awards was based on the closing price of our common stock on December 31, 2020 ($33.53) and assumed target performance. All outstanding stock options are fully vested. Generally, there are no payments made to executive officers in the event of an involuntary termination for Cause. As described under Pension Benefits beginning on page 56, the NEOs are vested in their pension benefits and there is no acceleration or increase in pension benefits upon termination except as set forth below.
Change in Control + Qualifying Termination | ||||||||||||||||||||
Name |
Cash (1) ($) |
Equity (2) ($) |
Pension (3) ($) |
Other (4) ($) |
Total ($) |
|||||||||||||||
Devin W. Stockfish
|
|
10,890,000
|
|
|
17,102,379
|
|
|
485,563
|
|
|
143,660
|
|
|
28,621,602
|
| |||||
Russell S. Hagen
|
|
3,437,500
|
|
|
5,719,279
|
|
|
388,572
|
|
|
143,660
|
|
|
9,689,011
|
| |||||
Adrian M. Blocker
|
|
3,337,000
|
|
|
7,890,145
|
|
|
422,649
|
|
|
143,660
|
|
|
11,793,454
|
| |||||
James A. Kilberg
|
|
3,043,000
|
|
|
5,323,592
|
|
|
233,153
|
|
|
143,660
|
|
|
8,743,405
|
| |||||
Keith J. ORear
|
|
3,596,000
|
|
|
4,127,812
|
|
|
552,734
|
|
|
143,660
|
|
|
8,420,206
|
|
(1) | Amounts include payment in respect of salary, target bonus and earned annual bonus pursuant to the change in control agreements. |
(2) | Amounts include the intrinsic value of accelerated vesting of RSUs and PSUs as of December 31, 2020. Vested options would remain exercisable for the original term. See discussion under Change in Control for more information. |
(3) | Represents an estimated present value of an annual increase in Supplemental Retirement Plan pension payments pursuant to the terms of the NEOs change in control agreement with the company. The annual increase assumes credit for two additional years of service applies to benefits earned under Formula B and two additional years of age applies to benefits earned under Formula A and B following termination of employment. For Messrs. Hagen and Kilberg, the annual increase assumes credit for two additional years of service and two additional years of age applies to benefits under their respective former Plum Creek Timber Company, Inc. pension plans following termination of employment. Provisions for the CEO are the same except for additional years for service and age are three full years. See discussion under Pension Benefits beginning on page 56 for more information about these pension plans. |
60
|
WEYERHAEUSER COMPANY
|
EXECUTIVE COMPENSATION
(4) | Amounts include a lump sum payment to assist in paying for replacement health and welfare coverage for a reasonable period following the date of termination and related gross up payment, and an allowance for outplacement services with a value of up to $20,000 (fees are paid directly to the outplacement service provider). |
Severance | ||||||||||||||
Name
|
Cash (1) ($)
|
Equity (2) ($)
|
Pension ($)
|
Other (3) ($)
|
Total ($)
| |||||||||
Devin W. Stockfish
|
8,140,000
|
|
3,159,873
|
|
|
|
|
36,488
|
11,366,361
| |||||
Russell S. Hagen
|
2,828,125
|
|
1,885,769
|
|
|
|
|
36,488
|
4,750,382
| |||||
Adrian M. Blocker
|
2,722,750
|
|
4,032,452
|
|
|
|
|
36,488
|
6,791,690
| |||||
James A. Kilberg
|
2,487,250
|
|
1,772,488
|
|
|
|
|
36,488
|
4,296,226
| |||||
Keith J. ORear
|
2,991,500
|
|
585,230
|
|
|
|
|
36,488
|
3,613,218
|
(1) | Amounts include payment in respect of salary, target bonus and earned annual bonus pursuant to the severance agreements. |
(2) | For involuntary termination without cause due to job elimination, vesting of RSU and PSU awards continues for one year. Vested options would remain exercisable for the lesser of three years or the remainder of the original term. Notwithstanding the additional year of vesting, the three-year vesting period would not be achieved for PSUs granted in 2019 and 2020 and no shares would therefore be earned. |
(3) | Amounts include a lump sum payment to assist in paying for replacement health and welfare coverage and related gross up payment, along with an allowance for outplacement services with a value of up to $20,000 (fees are paid directly to the outplacement service provider). |
Other Severance - Death or Disability
|
||||||||||||||||||||
Name
|
Cash ($)
|
Equity (1) ($)
|
Pension ($)
|
Other ($)
|
Total ($)
|
|||||||||||||||
Devin W. Stockfish
|
|
|
|
|
17,102,379
|
|
|
|
|
|
|
|
|
17,102,379
|
| |||||
Russell S. Hagen
|
|
|
|
|
5,719,279
|
|
|
|
|
|
|
|
|
5,719,279
|
| |||||
Adrian M. Blocker
|
|
|
|
|
7,890,145
|
|
|
|
|
|
|
|
|
7,890,145
|
| |||||
James A. Kilberg
|
|
|
|
|
5,323,592
|
|
|
|
|
|
|
|
|
5,323,592
|
| |||||
Keith J. ORear
|
|
|
|
|
4,127,812
|
|
|
|
|
|
|
|
|
4,127,812
|
|
(1) | Upon termination due to death or disability, vesting of unvested RSUs would accelerate for grants made in 2017, 2018, 2019 and 2020; and for PSUs granted in 2018, 2019 and 2020, the number of shares earned would be based on actual performance against the related performance goals and would be released and paid at the end of the applicable performance period. |
Early Retirement | ||||||||||||||
Name
|
Cash ($)
|
Equity (1) ($)
|
Pension ($)
|
Other ($)
|
Total ($)
|
|||||||||
Devin W. Stockfish
|
|
|
|
|
|
|
|
|
| |||||
Russell S. Hagen
|
|
|
|
|
|
|
|
|
| |||||
Adrian M. Blocker
|
|
|
5,577,257
|
|
|
|
|
5,577,257
|
| |||||
James A. Kilberg
|
|
|
5,168,038
|
|
|
|
|
5,168,038
|
| |||||
Keith J. ORear
|
|
|
|
|
|
|
|
|
|
(1) | Upon early retirement, options would remain exercisable for the original term. Vesting of unvested RSUs would continue for grants made in 2017, 2018, and 2019, and the 2020 grant would be prorated based on the number of months worked after the grant date. For PSUs granted in 2018, 2019 and 2020, the number of actual shares earned would be based on the achievement of performance goals and released and paid at the end of the applicable performance period. Only Messrs. Blocker and Kilberg were eligible for early retirement as of December 31, 2020. |
The Compensation Committee acts on behalf of the board of directors to establish and oversee the companys executive compensation program in a manner that serves the interests of Weyerhaeuser and its shareholders. For a discussion of the committees policies and procedures, see Committees of the Board Compensation Committee.
The companys management has prepared the Compensation Discussion and Analysis (CD&A) included in this proxy statement. The Compensation Committee has reviewed and discussed with management the CD&A. Based on its review and those discussions, the committee recommended to the board of directors that the CD&A be included in the proxy statement for the companys 2021 annual meeting of shareholders.
2021 ANNUAL MEETING & PROXY STATEMENT
|
61
|
EXECUTIVE COMPENSATION
62
|
WEYERHAEUSER COMPANY
|
Management is responsible for the companys internal controls and the financial reporting process. KPMG LLP is responsible for performing an independent audit of the companys consolidated financial statements in accordance with generally accepted auditing standards and for issuing audit reports on the consolidated financial statements and the assessment of the effectiveness of internal control over financial reporting. The Audit Committees responsibility is to monitor and oversee these processes on behalf of the board of directors.
In discharging its responsibility for the year ended December 31, 2020:
● | The Audit Committee has reviewed and discussed the audited financial statements of the company with management; |
● | The Audit Committee has discussed with KPMG LLP the matters required to be discussed by Auditing Standard No. 1301, Communications with Audit Committees, as amended; |
● | The Audit Committee has received the written disclosures and the letter from KPMG LLP required by the Public Company Accounting Oversight Board regarding KPMGs communications with the Audit Committee concerning independence, and has reviewed, evaluated and discussed with that firm the written report and its independence from the company; and |
● | Based on the foregoing reviews and discussions, the Audit Committee recommended to the board of directors that the audited financial statements and assessment of internal control over financial reporting be included in the companys Annual Report on Form 10-K for the fiscal year ended December 31, 2020. |
The current members of the Audit Committee are set forth below.
● Sara Grootwassink Lewis, Chair |
● Lawrence A. Selzer | |
● Deidra C. Merriwether |
● D. Michael Steuert | |
● Marc F. Racicot |
● Kim Williams |
64
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WEYERHAEUSER COMPANY
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BENEFICIAL OWNERSHIP OF COMMON SHARES
Beneficial Ownership of Directors and Named Executive Officers
The following table shows, as of March 18, 2021, the number of common shares beneficially owned by each current director and named executive officer, and by all current directors and all executive officers as a group, as well as the number of common stock equivalent units owned by each current director and named executive officer and by all current directors and all executive officers as a group under the companys deferred compensation plans. Percentages of class have been calculated based upon 748,745,316 shares, which was the total number of common shares outstanding as of March 18, 2021.
Name of Individual or Identity of Group
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Voting and/or Dispositive Powers (number of common shares) (1)(2)(3)(4)
|
Percent of Class (common shares) |
Common Stock Equivalent Units (5) |
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Adrian M. Blocker |
|
343,434 |
|
|
* |
|
|
|
| |||
Mark A. Emmert |
|
31,695 |
|
|
* |
|
|
25,524 |
| |||
Russell S. Hagen |
|
150,995 |
|
|
* |
|
|
|
| |||
Rick R. Holley |
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379,028 |
|
|
* |
|
|
33,900 |
| |||
James A. Kilberg |
|
112,767 |
|
|
* |
|
|
|
| |||
Sara Grootwassink Lewis |
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17,523 |
|
|
* |
|
|
38,914 |
| |||
Deidra C. Merriwether |
|
|
|
|
2,249 |
| ||||||
Al Monaco |
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17,904 |
|
|
* |
|
|
|
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Keith J. ORear |
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35,522 |
|
|
* |
|
|
|
| |||
Nicole W. Piasecki |
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177,276 |
|
|
* |
|
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69,221 |
| |||
Marc F. Racicot |
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48,637 |
|
|
* |
|
|
|
| |||
Lawrence A. Selzer |
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42,237 |
|
|
* |
|
|
|
| |||
D. Michael Steuert |
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36,469 |
|
|
* |
|
|
72,707 |
| |||
Devin W. Stockfish |
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332,547 |
|
|
* |
|
|
|
| |||
Kim Williams |
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40,826 |
|
|
* |
|
|
70,443 |
| |||
Charles R. Williamson |
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49,363 |
|
|
* |
|
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174,794 |
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Directors and executive officers as a group (19 persons)(6)
|
|
2,029,790
|
|
|
*
|
|
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496,284
|
|
* | Denotes amount is less than 1% |
(1) | Includes the number of shares that could be acquired within 60 days after March 18, 2021 pursuant to outstanding stock options, as follows: Mr. Blocker, 214,734 shares; Mr. ORear, 15,745 shares; Mr. Stockfish, 163,580 shares; and the executive officers as a group, 506,977 shares. |
(2) | Includes 151,456 shares for which Ms. Piasecki shares voting and dispositive powers with one or more other persons. Ms. Piasecki disclaims beneficial ownership of these shares. |
(3) | Includes RSUs granted to non-employee directors that will vest and be payable on May 15, 2021 in shares of the companys common stock but does not include dividends to be credited to those shares as of March 19, 2021, as follows: Mr. Emmert, 7,222 shares; Mr. Monaco, 7,222 shares; Ms. Piasecki, 7,222 shares; Mr. Racicot, 7,222 shares; Mr. Selzer, 7,222 shares; Mr. Steuert, 7,222 shares; Ms. Williams, 7,222 shares; and Mr. Williamson, 7,222 shares. |
(4) | Amount shown for Ms. Lewis excludes 7,987 shares of common stock that she previously deferred and for which she does not have voting or dispositive power. Ms. Lewis maintains an economic and pecuniary interest in these shares. |
(5) | Common stock equivalent units held as of March 18, 2021 under the Fee Deferral Plan for Directors or under the companys compensation deferral plan for executive officers. The common stock equivalent units will be repaid to the director at the end of the deferral period in the form of shares of company common stock and to the executive officer at the end of the deferral period in the form of cash. |
2021 ANNUAL MEETING & PROXY STATEMENT
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65
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STOCK INFORMATION
(6) | Represents the group of executive officers and directors as of March 18, 2021. This includes Mr. Kilberg who retired from the company effective on March 1, 2021 (before the meeting record date), but whose beneficial ownership is nonetheless reported here under SEC rules because he is an NEO for 2020. The group of executive officers also includes Ms. Nancy Loewe who was appointed as senior vice president and chief financial officer March 8, 2021. Ms. Loewe, 53, served most recently as the senior vice president of finance for Visa, Inc., a financial services corporation, from March 2019 to March 2021. From April 2017 to February 2019, she served as the chief financial officer and chief operating officer of TropicSport, a manufacturer and seller of skin care products; and from April 2014 to March 2017, she served as the chief financial officer for the International division of Kimberly-Clark, a multi-national producer of paper-based personal care consumer products. As of March 18, 2021, Ms. Loewe has beneficial ownership in 21,627 restricted stock units, which are not included in the total reported here, and has no beneficial ownership of common shares or common stock equivalents. |
Beneficial Ownership of Owners of More Than 5% of the Companys Common Shares
The following table shows the number of common shares held by persons known to the company to beneficially own more than 5% of its outstanding common shares. Percentages of class have been calculated based upon 748,745,316 shares, which was the total number of common shares outstanding as of March 18, 2021.
Name and Address of Beneficial Owner
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Amount and Nature of Beneficial Ownership
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Percent of Class (common shares)
|
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BlackRock, Inc.
55 East 52nd Street
New York, NY 10022
|
|
52,733,375 |
(1) |
|
7.04 |
% | ||
T. Rowe Price Associates, Inc.
100 E. Pratt Street
Baltimore, MD 21202
|
|
66,778,740 |
(2) |
|
8.92 |
% | ||
The Vanguard Group
100 Vanguard Blvd.
Malvern, PA 19355
|
|
115,328,627 |
(3) |
|
15.40 |
% |
(1) | Based on a Schedule 13G/A dated January 31, 2021 in which BlackRock, Inc. reported that as of December 31, 2020 it had sole voting power over 46,399,066 shares and sole dispositive power over 52,733,375 shares. |
(2) | Based on a Schedule 13G/A dated February 16, 2021 in which T. Rowe Price Associates, Inc. reported that as of December 31, 2020 it had sole voting power over 32,056,023 shares and sole dispositive power over 66,778,740 shares. |
(3) | Based on a Schedule 13G/A dated February 8, 2021 in which The Vanguard Group reported that as of December 31, 2020 it had shared voting power over 1,163,587 shares, sole dispositive power over 112,157,126 shares and shared dispositive power over 3,171,501 shares. |
66
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WEYERHAEUSER COMPANY
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STOCK INFORMATION
INFORMATION ABOUT SECURITIES AUTHORIZED FOR ISSUANCE UNDER OUR EQUITY COMPENSATION PLANS
The following table describes, as of December 31, 2020, the number of shares subject to outstanding equity awards under the companys 2013 Long-Term Incentive Plan, 2004 Long-Term Incentive Plan and 1998 Long-Term Incentive Compensation Plan, and the weighted average exercise price of outstanding stock options and stock appreciation rights. The 2013 Plan was approved by shareholders at the 2013 annual meeting of shareholders and replaces the 2004 Plan and 1998 Plan, under which no further awards may be granted. The following table shows the number of shares available for future issuance under the 2013 Plan.
Number of Securities to Be Issued Upon Exercise of Outstanding Options, Warrants and Rights (A) |
Weighted Average Exercise Outstanding Options, Warrants and Rights (B) |
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected In Column (A)) (C) |
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Equity compensation plans approved by security holders (1) |
6,816,000 | $ | 16.30 | 20,233,000 | ||||||||
Equity compensation plans not approved by security holders |
| | | |||||||||
Total |
6,816,000 | $ | 16.30 | 20,233,000 |
(1) | Includes 1.851 million restricted stock units and 1.098 performance share units. Because there is no exercise price associated with restricted stock units and performance share units, excluding these stock units the weighted average price calculation would be $28.74. |
2021 ANNUAL MEETING & PROXY STATEMENT
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67
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STOCK INFORMATION
68
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WEYERHAEUSER COMPANY
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STOCK INFORMATION
2021 ANNUAL MEETING & PROXY STATEMENT
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69
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INFORMATION ABOUT THE MEETING
2021 ANNUAL MEETING & PROXY STATEMENT
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71
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INFORMATION ABOUT THE MEETING
72
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WEYERHAEUSER COMPANY
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RECONCILIATION OF NON-GAAP PERFORMANCE MEASURES TO GAAP
The table below reconciles both Adjusted EBITDA and net earnings before special items to net earnings, as that is the most directly comparable U.S. GAAP measure. We use Adjusted EBITDA as a key performance measure to evaluate the performance of the company. Our definition of Adjusted EBITDA may be different from similarly titled measures reported by other companies. Adjusted EBITDA, as we define it, is operating income adjusted for depreciation, depletion, amortization, basis of real estate sold and special items. These measures should not be considered in isolation from, and are not intended to represent an alternative to, our results reported in accordance with U.S. GAAP. However, we believe they provide meaningful supplemental information for our investors about our operating performance, better facilitate period to period comparisons and are widely used by analysts, lenders, rating agencies and other interested parties.
DOLLAR AMOUNTS IN MILLIONS
|
2020
|
|||
Net earnings
|
$ |
797 |
| |
Interest expense, net of capitalized interest (1)
|
|
443
|
| |
Income taxes
|
|
185
|
| |
Net contribution to earnings
|
$
|
1,425
|
| |
Non-operating pension and other post-employment benefit costs (2)
|
|
290
|
| |
Interest income and other
|
|
(5
|
)
| |
Operating income
|
$
|
1,710
|
| |
Depreciation, depletion and amortization
|
|
472
|
| |
Basis of real estate sold
|
|
141
|
| |
Special items included in operating income (3)
|
|
(122
|
)
| |
Adjusted EBITDA
|
$
|
2,201
|
|
(1) | Interest expense, net of capitalized interest includes pretax special items of $92 million related to charges for the early extinguishment of debt. |
(2) | Non-operating pension and other post-employment benefit costs includes a pretax special item consisting of a $253 million noncash settlement charge related to the transfer of pension plan assets and liabilities through the purchase of a group annuity contract. |
(3) | Operating income includes pretax special items consisting of a $182 million gain on sale of certain southern Oregon timberlands, an $80 million timber casualty loss, a $12 million noncash legal benefit and an $8 million product remediation insurance recovery. |
DOLLAR AMOUNTS IN MILLIONS
|
2020
|
|||
Net earnings
|
$
|
797
|
| |
Special items (after-tax) (1)
|
|
165
|
| |
Net earnings before special items
|
$
|
962
|
|
(1) | After-tax special items include a $193 million noncash pension settlement charge, a $182 million gain on sale of certain southern Oregon timberlands, $92 million in charges related to the early extinguishment of debt, an $80 million timber casualty loss, a $12 million noncash legal benefit and a $6 million product remediation insurance recovery. |
A-1
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WEYERHAEUSER COMPANY
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Working together to be the world's premier timber, land, and forest products company FOR MORE INFORMATION, VISIT http://investor.weyerhaeuser.com
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: | ||||||||
D41836-P49971 | KEEP THIS PORTION FOR YOUR RECORDS | |||||||
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THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. | DETACH AND RETURN THIS PORTION ONLY |
WEYERHAEUSER COMPANY
Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.
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Signature [PLEASE SIGN WITHIN BOX] | Date | Signature (Joint Owners) | Date |
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The 2021 Notice and Proxy Statement and 2020 Annual Report are available at www.proxyvote.com.
D41837-P49971
ANNUAL MEETING OF SHAREHOLDERS
MAY 14, 2021
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints Rick R. Holley, Devin W. Stockfish and Kristy T. Harlan, and each of them with full power to act without the other and with full power of substitution, as proxies to represent and to vote, as directed herein, all shares (other than shares held in benefit plans - see below) the undersigned is entitled to vote at the Annual Meeting of Shareholders of Weyerhaeuser Company to be held at www.virtualshareholdermeeting.com/WY2021, on Friday, May 14, 2021, at 8:00 a.m., Pacific Time, and all adjournments or postponements thereof. Shares will be voted as directed on the reverse side of this proxy card and in the discretion of the proxy holders as to any other matter that may properly come before the Annual Meeting of Shareholders. If the proxy card is signed and returned without specific instructions for voting, the shares will be voted in accordance with the recommendations of the Board of Directors.
If there are shares allocated to the undersigned in one or more of the Weyerhaeuser 401(k) Plan or Weyerhaeuser Company Limited Investment Growth Plan, the undersigned hereby directs the plan trustee to vote all full and fractional shares as indicated on the reverse side of this proxy card. The plan trustee must receive your proxy instructions no later than 11:59 p.m., Eastern Time, on May 11, 2021. If the proxy card is signed and returned without specific instructions for voting, the shares will be voted in accordance with the recommendations of the Board of Directors. However, if (a) the proxy card is returned without a signature, (b) the proxy card is not returned at all, or (c) the proxy card is received after 11:59 p.m., Eastern Time, on May 11, 2021, then in each case the plan trustee will vote in the same manner and proportion as the benefit plan shares for which the plan trustee has received valid voting instructions.
Continued and to be signed on reverse side
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