Waste Management (WM) 10-K risk factor changes: FY2019 vs FY2018

[added: In an effort to keep our stockholders and the public informed about our business, we may make “forward-looking statements.”] Forward-looking statements are often identified by the words, “will,” “may,” “should,” “continue,” “anticipate,” “believe,” “expect,” “plan,” “forecast,” “project,” “estimate,” “intend” and words of a similar nature and generally include statements [removed: containing:][added: regarding:]

| | [removed: · |] [added: ●] | plans and objectives for the future; |

| | [removed: · |] [added: ●] | [removed: projections or] [added: projections,] estimates [removed: about] [added: or] assumptions relating to our [added: operational or financial] performance; or |

| | [removed: · |] [added: ●] | our opinions, views or beliefs about the effects of current or future events, circumstances or performance. |

Outlined below are some of the risks that we believe could affect our business and financial statements for [removed: 2019] [added: 2020] and beyond and [removed: that] could cause actual results to be materially different from those that may be set forth in forward-looking statements made by the Company.

[removed: Business] [added: _Business_] for more information on our business strategy.

| | [removed: · |] [added: ●] | Our employees, customers or investors may not embrace and support our strategy. |

| | [removed: · |] [added: ●] | We may not be able to hire or retain the personnel necessary to manage our strategy effectively. |

| | [removed: · |] [added: ●] | A key element of our strategy is yield management through focus on price leadership, which has presented challenges to keep existing business and win new business at reasonable returns. We have also continued our environmental fee, fuel surcharge and regulatory recovery fee to offset costs. The loss of volumes as a result of price increases and our unwillingness to pursue lower margin volumes may negatively affect our cash flows or results of operations. Additionally, we have in the past and [removed: continue to] [added: may in the future] face purported class action lawsuits related to our customer service agreements, prices and fees. |

| | [removed: · |] [added: ●] | We may be unsuccessful in implementing improvements to operational efficiency and such efforts may not yield the intended result. |

| | [removed: · |] [added: ●] | We may not be able to maintain cost savings achieved through optimization efforts. |

| | [removed: · |] [added: ●] | Strategic decisions with respect to our asset portfolio may result in impairments to our assets. See Item 1A. [removed: Risk Factors] [added: _Risk Factors_] — [removed: We] [added: _We] may record material charges against our earnings due to impairments to our [removed: assets.] [added: assets_.] |

| | [removed: · |] [added: ●] | Our ability to make strategic acquisitions depends on our ability to identify desirable acquisition targets, negotiate advantageous transactions despite competition for such opportunities, fund such acquisitions on favorable terms, obtain regulatory approvals and realize the benefits we expect from those transactions. |

| | [removed: · |] [added: ●] | Acquisitions, investments and/or new service offerings may not increase our earnings in the timeframe anticipated, or at all, due to difficulties operating in new markets or providing new service offerings, failure of emerging technologies to perform as expected, failure to operate within budget, integration issues, or regulatory issues, among others. |

| | [removed: · |] [added: ●] | Integration of acquisitions and/or new services offerings could increase our exposure to the risk of inadvertent noncompliance with applicable laws and regulations. |

| | [removed: · |] [added: ●] | Liabilities associated with acquisitions, including ones that may exist only because of past operations of an acquired business, may prove to be more difficult or costly to address than anticipated. |

| | [removed: · |] [added: ●] | Execution of our strategy, particularly growth through acquisitions, may cause us to incur substantial additional indebtedness, which may divert capital away from our traditional business operations and other financial plans. |

| | [removed: · |] [added: ●] | We continue to seek to divest underperforming and non-strategic assets if we cannot improve their profitability. We may not be able to successfully negotiate the divestiture of underperforming and non-strategic operations, which could result in asset impairments or the continued operation of low-margin businesses. |

In addition to the risks set forth above, implementation of our business strategy could also be affected by [added: other] factors beyond our control, such as increased competition, legal developments, government regulation, general economic conditions, increased operating costs or expenses, subcontractor costs and availability and changes in industry trends.

Compliance with existing or increased future regulations and/or enforcement of such regulations [removed: may] [added: can] restrict or change our operations, increase our operating costs or require us to make additional capital expenditures, and a decrease in regulation may lower barriers to entry for our competitors.

Among other things, governmental regulations and enforcement actions [removed: may] restrict our operations [added: at times] and [added: may] adversely affect our financial condition, results of operations and cash flows by imposing conditions such as:

| | [removed: · |] [added: ●] | limitations on siting and constructing new waste disposal, transfer, recycling or processing facilities or on expanding existing facilities; |

| | [removed: · |] [added: ●] | limitations, regulations or levies on collection and disposal prices, rates and volumes; |

| | [removed: · |] [added: ●] | limitations or bans on disposal or transportation of out-of-state waste or certain categories of waste; |

| | [removed: · |] [added: ●] | mandates regarding the management of solid waste, including requirements to recycle, divert or otherwise process certain waste, recycling and other streams; or |

| | [removed: · |] [added: ●] | limitations or restrictions on the recycling, processing or transformation of waste, recycling and other streams. |

Regulations affecting the siting, design and closure of landfills [removed: could] require [removed: us] [added: us, at times,] to undertake investigatory or remedial activities, curtail operations or close landfills temporarily or permanently.

We [removed: also] have significant financial obligations relating to final capping, closure, post-closure and environmental remediation at our existing [removed: landfills.][added: landfills and we establish accruals for these estimated costs.]

[removed: We establish accruals for these estimated costs, but we] [added: Expenditures] could [removed: underestimate such] [added: be accelerated or materially exceed our] accruals [removed: because of] [added: due to] the types of waste collected and manner in which it is transported and disposed of, including actions taken in the past by companies we have acquired or third-party landfill [removed: operators or due to] [added: operators; environmental regulatory changes;] new information about waste types previously collected, [removed: among] [added: such as PFAS or] other [added: emerging contaminates, and other] reasons.

The permits and approvals are often difficult, time consuming and costly to obtain and [removed: could] [added: sometimes] contain conditions that limit our operations.

Along with the funding responsibility, producers may be required to [removed: take] [added: undertake additional responsibilities, such as taking] over management of local recycling programs by taking back their products from end users or managing the collection operations and recycling processing infrastructure.

The [added: policies set forth under the] current U.S. [removed: presidential administration has called] [added: administration,] for [added: example, have included] substantial changes to foreign trade policy and [removed: has] generally [removed: appeared to be] [added: have been] in favor of reducing regulation, including environmental regulation.

Reduction of regulation may have a favorable impact on our operating costs, but the extensive environmental regulation [removed: applicable to] [added: governing] landfills is a substantial barrier to entry that benefits our Company.

[removed: Most of the recyclables that we process for sale are paper fibers, including old corrugated cardboard and old newsprint, and a] [added: A] significant portion of the fiber that we market has [added: historically] been shipped to export markets across the globe, particularly China.

Many other markets, both domestic and foreign, have tightened their quality expectations [added: and limited or restricted the import of certain recyclables] as well.

[removed: Single stream] [added: In particular, single-stream] MRFs process a wide range of commingled materials and tend to receive a higher percentage of non-recyclables, which results in increased processing and residual disposal costs to achieve quality standards.

[removed: Also in 2017, the] [added: The] Chinese government [removed: began to limit] [added: has also limited] the flow of material into [removed: the country] [added: China] by restricting the issuance of required import [removed: licenses.][added: licenses and the restriction on import licenses is expected to constrict further in 2020.]

[removed: The current U.S. presidential administration has made substantial] [added: In addition,] changes to foreign trade policy and [added: tariffs] imposed [removed: increases] [added: by the current U.S. administration have resulted] in [added: China imposing new] tariffs on [removed: international trade.][added: the import of recyclables.]

[removed: If the Chinese government’s regulations and tariffs or initiatives or other similar regulations,] [added: Additionally, future regulation,] tariffs or initiatives [added: may] result in further reduced demand or increased operating costs, [added: which would cause] the profitability of our recycling operations [removed: may] [added: to] decline.

We have been actively working to identify alternative markets for [removed: recycled] [added: recycling] commodities, but [removed: it is possible] there may not be [removed: sufficient] demand for all of the material we [removed: produce, resulting in price decreases and increased volatility.][added: produce.]

| | ● | future results of operations, including revenues, earnings or cash flows; |

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Our planned acquisition of Advanced Disposal Services, Inc. (“Advanced Disposal”) may not occur at all, may not occur in the expected time frame or may involve the divestiture of certain businesses and assets, which may negatively affect the trading price of our common stock and our future business and financial results.

On April 14, 2019, we entered into an Agreement and Plan of Merger pursuant to which, among other things and subject to the satisfaction or waiver of specified conditions, we agreed to acquire Advanced Disposal.

If the acquisition is completed, Advanced Disposal will become an indirect wholly-owned subsidiary of WM.

The consummation of the acquisition is not assured and is subject to certain conditions, including the expiration or termination of any waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder and the absence of any law or order restraining, enjoining or otherwise prohibiting the acquisition, as well as other customary closing conditions.

The planned acquisition of Advanced Disposal is subject to a number of risks and uncertainties, including general economic and capital markets conditions; the effects that the pending merger may have on us, Advanced Disposal and our respective businesses; inability to obtain required regulatory or government approvals or to obtain such approvals on satisfactory conditions; inability of Advanced Disposal to satisfy other closing conditions; the occurrence of any event, change or other circumstance that could give rise to the termination of the Agreement and Plan of Merger, several of which could require us to pay a termination fee of $150 million to Advanced Disposal; legal proceedings that may be instituted related to the proposed acquisition and the legal expenses and diversion of management’s attention that may be associated therewith; and unexpected costs, charges or expenses.

If the planned acquisition of Advanced Disposal is not completed, if there are significant delays in completing the planned acquisition or if the planned acquisition involves an unexpected amount of required divestitures, it could negatively affect the trading price of our common stock and our future business and financial results.

Additionally, in May 2019, we issued senior notes with an aggregate principal amount of $3 billion that include a special mandatory redemption feature.

This feature provides that if the acquisition of Advanced Disposal is not completed on or prior to July 14, 2020, or if, prior to such date, the Agreement and Plan of Merger is terminated for any reason, we will be required to redeem all of such outstanding notes equal to 101% of the aggregate principal amounts of such notes, plus accrued but unpaid interest.

Our ability to pay the redemption price may be limited by our financial resources at the time and the terms of our debt instruments and other instruments and agreements.

We may also be required to incur additional indebtedness and reduce availability under our $3.5 billion revolving credit facility to fund the redemption price.

Any failure to pay the special mandatory redemption price of such notes when due would constitute an event of default with respect to the notes of such series and could have a material adverse effect on our business, results of operations and financial condition and the market prices of our securities.

Further, if we redeem such series of notes pursuant to the special mandatory redemption feature, our investors may be dissatisfied that they did not obtain the return that they expected on their investment in those notes.

We may not realize the strategic benefits and cost synergies that are anticipated from the planned acquisition of Advanced Disposal.

The benefits that are expected to result from the planned acquisition of Advanced Disposal will depend, in part, on our ability to realize anticipated cost synergies.

Our success in realizing these benefits and cost synergies, and the timing of this realization, depends on the successful integration of Advanced Disposal.

There is a significant degree of difficulty and management distraction inherent in the process of integrating an acquisition of this size.

The process of integrating operations could cause business interruption and distraction.

Some members of our management may be required to devote considerable time to this integration process, which will decrease the time they will have to manage our Company, service existing customers, attract new customers and develop new products or strategies.

If management is not able to effectively manage the integration process, or if any significant business activities are interrupted as a result of the integration process, our business, financial condition and results of operations could suffer.

The acquisition of Advanced Disposal may not result in realization of the benefits and cost synergies that we currently expect, and we cannot guarantee that these benefits and cost synergies will be achieved within anticipated time frames or at all.

Additionally, we may incur substantial expenses in connection with the integration of Advanced Disposal, which may exceed expectations and offset certain benefits.

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In an effort to keep our stockholders and the public informed about our business, we may make “forward-looking statements.” Forward-looking statements usually relate to future events and anticipated revenues, earnings, cash flows or other aspects of our operations or operating results.

| | · | | projections about accounting and finances; |

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Future changes in these regulations may require us to modify, supplement or replace equipment or facilities.

The costs of complying with these regulations could be substantial.

Environmental regulatory changes could accelerate or increase capping, closure, post-closure and remediation costs, requiring our expenditures to materially exceed our current accruals.

In recent years, we perceived an increase in both the amount of government regulation and the number of enforcement actions being brought by regulatory entities against operations in the waste services industry.

We cannot predict what impact the current administration will

have on the political and regulatory environment in the U.S., the timing of any such changes, or the impact of any such changes on our business.

Our recycling operations process for sale certain recyclable materials, including fibers, aluminum and plastics, which are subject to significant market price fluctuations.

In 2013, the Chinese government began to strictly enforce regulations that establish limits on moisture and non-conforming materials that may be contained in imported recycled paper and plastics and restrict the import of certain other plastic recyclables.

In 2017, the Chinese government announced a ban on certain materials, including mixed waste paper and mixed plastics, effective January 1, 2018, as well as extremely restrictive quality requirements effective March 1, 2018 that have been difficult for the industry to achieve.

In addition, other countries have limited or restricted the import of certain recyclables.

The use of restrictions on import licenses to restrict flow into China continued in 2018 and is expected to continue in 2019.

In response, China has imposed new tariffs on the import of recyclable commodities, including wastepaper, plastics and metals.

The increase in market prices in 2017 and 2016 for recycling commodities resulted in increases in revenue of $237 million and $51 million, respectively.

Additionally, under some agreements, our recycling operations are required to pay rebates to suppliers.

In some cases, if we experience higher revenues based on increased market prices for recycling commodities, the rebates we pay will also increase.

In other circumstances, the rebates may be subject to a floor, such that as market prices decrease, any expected profit margins on materials subject to the rebate floor are reduced or eliminated.

As we work to revise service agreements to mitigate the impact of commodity price fluctuations, the potential increase in the cost for recycling services may make it more difficult for us to win bids and may slow the growth of recycling overall.

Bans on single use plastic bags, straws, and polystyrene food containers have been passed in over 350 cities, and a ban on single use plastic bags has been implemented in the State of California.

inclusion of such materials in our recycling stream can increase contamination of the recycling stream and negatively affect the results of our recycling operations.

indemnification obligations owed to us.

Many non-governmental customers have also suffered serious financial difficulties, including bankruptcy in some cases.

vested benefits at the time of the withdrawal.

We have previously withdrawn from certain underfunded Multiemployer Pension Plans, and we recognized related expenses of $3 million and $12 million in 2018 and 2017, respectively.

In 2016, we did not recognize any charges for the withdrawal from Multiemployer Pension Plans.

As of December 31, 2018, we had C$15 million, or $11 million, of Canadian borrowings outstanding borrowings under this facility.

expanded the EPA’s federal air permitting authority to include the six GHGs.

However, if certain changes to these regulations were enacted, such as lowering the thresholds or the inclusion of biogenic emissions, then the amendments could have an adverse effect on our operating costs.

This section includes a discussion of our results of operations for the three years ended December 31, [removed: 2018.][added: 2019.]

[removed: Revenues from our] collection [removed: operations are influenced by factors such as collection frequency, type of collection] equipment furnished, type and volume or weight of the waste collected, distance to the disposal facility or material recovery facility and our disposal costs.

We also provide additional services that are not managed through our Solid Waste business, described under [removed: Results] [added: _Results] of [removed: Operations] [added: Operations_] below.

[removed: Business Environment][added: Business Environment]

[removed: Due to this, we] [added: We] monitor these developments to adapt our services offerings.

As companies, individuals and communities look for ways to be more sustainable, we [removed: are promoting] [added: promote] our comprehensive services that go beyond our core business of collecting and disposing of waste in order to meet their needs.

We also encounter competition for [removed: acquisition] [added: acquisitions] and growth opportunities.

Our industry is directly affected by changes in general economic factors, [removed: as] [added: including] increases and decreases in consumer spending, business expansions and construction [removed: starts generally correlate to volumes of waste generated and our revenues.][added: starts.]

Negative economic conditions, in addition to competitor actions, can make it more challenging to negotiate, renew or expand service contracts with acceptable margins and [added: in addition,] customers may reduce their service needs.

General economic factors and the market for consumer goods, in addition to regulatory developments, can also significantly impact commodity prices for [added: the] recyclable materials we sell.

[removed: The] [added: In 2019, we have benefited from a] generally favorable macro-economic environment, including steady spending by consumers and [removed: businesses and construction starts, has benefited our] [added: businesses, which have led to] volume [removed: growth] and gross [removed: margins in recent quarters.][added: margin growth.]

[removed: Current] [added: Current] Year Financial [removed: Results][added: Results]

During [removed: 2018,] [added: 2019,] we continued to produce strong operating results from our [removed: Traditional Solid Waste] [added: collection and disposal] business, driven by [removed: strong yield] [added: favorable market conditions] and [removed: volume growth in] our [removed: collection] [added: focus on delivering an outstanding customer experience] and [removed: disposal business.][added: continuous improvement.]

The Company continued its commitment to supporting both organic and inorganic growth during [removed: 2018,] [added: 2019,] allocating [removed: $1,694] [added: $1,818] million of available cash to capital expenditures and [removed: $466] [added: $527] million to the acquisition of solid waste [removed: businesses.][added: businesses, of which $6 million was recorded as cash flow from financing activities related to the timing of contingent consideration paid.]

We also allocated [removed: $1,806] [added: $1,124] million to our shareholders during [removed: 2018] [added: 2019] through [added: dividends and] common stock [removed: repurchases and dividends.][added: repurchases.]

Key items of our [removed: 2018] [added: 2019] financial results include:

| | [removed: · |] [added: ●] | Revenues of [removed: $14,914] [added: $15,455] million for [removed: 2018] [added: 2019] compared with [removed: $14,485] [added: $14,914] million in [removed: 2017,] [added: 2018,] an increase of [removed: $429] [added: $541] million, or [removed: 3.0%. This] [added: 3.6%. The] increase is primarily attributable to (i) higher [removed: volumes due to improving market conditions; (ii) increased] yield [added: and volumes] in our collection and disposal business and [removed: (iii) increased recycling brokerage volumes,] [added: (ii) acquisitions, net of divestitures,] partially offset by [removed: (i)] lower market prices for recycling [removed: commodities and (ii) fluctuations in foreign currency and other;] [added: commodities;] |

| | [removed: · |] [added: ●] | Operating expenses of [removed: $9,249] [added: $9,496] million in [removed: 2018,] [added: 2019,] or [removed: 62.0%] [added: 61.4%] of revenues, compared with [removed: $9,021] [added: $9,249] million, or [removed: 62.3%] [added: 62.0%] of revenues, in [removed: 2017. This increase of $228] [added: 2018. The $247] million [added: increase] is primarily attributable to higher volumes and cost inflation in the current year period, partially offset by (i) [removed: changes in accounting for rebates and certain franchise fees required by the adoption of ASU 2014-09 and (ii)] decreased cost of goods sold [added: primarily] due to lower market prices for recycling [removed: commodities;] [added: commodities and (ii) the favorable impact of a year-over-year increase in federal natural gas fuel credits;] |

| | [removed: · |] [added: ●] | Net cash provided by operating activities was [removed: $3,570] [added: $3,874] million [removed: in 2018] compared with [removed: $3,180] [added: $3,570] million in [removed: 2017;] [added: the prior year period;] and |

| | [removed: · |] [added: ●] | Free cash flow was [removed: $2,084] [added: $2,105] million [removed: in 2018] compared with [removed: $1,770] [added: $2,084] million in [removed: 2017.] [added: the prior year period.] The [removed: $314 million] increase [removed: was a result of (i) higher earnings from our Traditional Solid Waste business; (ii) lower income tax payments associated with enactment of tax reform] in [removed: late 2017 and timing of income tax payments and (iii) divestitures of certain hauling and ancillary operations partially] [added: cash flow provided by operating activities noted above was] offset by [removed: higher] [added: an increase in] capital expenditures [added: resulting from our intentional focus on accelerating certain collection fleet and landfill spending] to support [removed: organic] [added: the Company’s strong collection and disposal] growth [added: and lower proceeds from divestitures, which resulted] in [removed: our business.] [added: free cash flow being $21 million higher on a year-over-year basis.] Free cash flow is a non-GAAP measure of liquidity. Refer to [removed: Free] [added: _Free] Cash [removed: Flow below] [added: Flow_ within _Liquidity and Capital Resources_] for our definition of free cash flow, additional information about our use of this measure, and a reconciliation to net cash provided by operating activities, which is the most comparable GAAP measure. |

We also provide additional services that are not managed through our Solid Waste business, including both our WMSBS and EES organizations, recycling brokerage services, landfill gas-to-energy services and certain other [added: expanded service offerings and solutions.]

[added: _Landfill Operating Costs —_] The following table summarizes [removed: revenues during] [added: our landfill operating costs for] the years ended December 31 (in millions):

| [added: ​] | [removed: 2018] | | [added: 2019] | [removed: 2017] | | [added: 2018] | [removed: 2016] | | [added: 2017 | |]

| Solid [removed: Waste] [added: Waste:] | [removed: $] | [removed: 15,537] [added: ​] | | [removed: $] | [removed: 14,832] [added: ​] | | [removed: $] | [removed: 13,968] | [added: ​ | ​ | | | ​ | | | | ​ | ​ | ​ | |]

| Intercompany [added: (b)] | [added: ​] | [removed: (3,110)] [added: ​] | | [added: (3,249)] | [removed: (2,885)] [added: ​] | | [added: (3,110)] | [removed: (2,637)] [added: ​] | [added: | (2,885) |]

| Total | [added: ​ | ​ |] $ | [removed: 14,914] [added: 15,455] | [added: ​] | $ | [removed: 14,485] [added: 14,914] | [added: ​] | $ | [removed: 13,609] [added: 14,485] |

| [added: ​] | | [added: 2019] | [removed: 2018] | | | [removed: 2017] [added: ​] | | [added: 2018] | [removed: 2016] | | [added: | ​ | | 2017 | | | | ​ |]

| Commercial | [added: ​] | [added: ​] | $ | [removed: 3,972] [added: 4,229] | [added: ​] | $ | [removed: 3,714] [added: 3,972] | [added: ​] | $ | [removed: 3,480] [added: 3,714] |

| Residential | [added: ​] | [added: ​] | | [removed: 2,529] [added: 2,613] | [added: ​] | | [removed: 2,528] [added: 2,529] | [added: ​] | | [removed: 2,487] [added: 2,528] |

| Industrial | [added: ​] | [added: ​] | | [removed: 2,773] [added: 2,916] | [added: ​] | | [removed: 2,583] [added: 2,773] | [added: ​] | | [removed: 2,412] [added: 2,583] |

| Other [added: collection] | [added: ​] | [added: ​] | | [removed: 450] [added: 482] | [added: ​] | | [removed: 439] [added: 450] | [added: ​] | | [removed: 423] [added: 439] |

| Total collection | [added: ​] | [added: ​] | | [removed: 9,724] [added: 10,240] | [added: ​] | | [removed: 9,264] [added: 9,724] | [added: ​] | | [removed: 8,802] [added: 9,264] |

| Landfill | [added: ​] | [added: ​] | | [removed: 3,560] [added: 3,846] | [added: ​] | | [removed: 3,370] [added: 3,560] | [added: ​] | | [removed: 3,110] [added: 3,370] |

| Transfer | [added: ​] | [added: ​] | | [removed: 1,711] [added: 1,820] | [added: ​] | | [removed: 1,591] [added: 1,711] | [added: ​] | | [removed: 1,512] [added: 1,591] |

| Recycling | [added: ​] | [added: ​] | | [removed: 1,293] [added: 1,040] | [added: ​] | | [removed: 1,432] [added: 1,293] | [added: ​] | | [removed: 1,221] [added: 1,432] |

| Other (a) | [added: ​] | [added: ​] | | [removed: 1,736] [added: 1,758] | [added: ​] | | [removed: 1,713] [added: 1,736] | [added: ​] | | [removed: 1,601] [added: 1,713] |

| [removed: |] (a) | [removed: |] The “Other” line of business includes (i) our WMSBS organization; (ii) our landfill gas-to-energy operations; (iii) certain services within our EES organization, including our construction and remediation services and our services associated with the disposal of fly ash and (iv) certain other expanded service offerings and solutions. In addition, our “Other” line of business reflects the results of non-operating entities that provide financial assurance and self-insurance support, net of intercompany activity. [added: Activity related to collection, landfill, transfer and recycling has been reclassified to the appropriate line of business for purposes of presentation.] |

| [removed: |] (b) | [removed: |] Intercompany revenues between lines of business are eliminated in the Consolidated Financial Statements included within this report. |

The following table provides details associated with the period-to-period change in revenues and average yield [added: for the years ended December 31] (dollars in millions):

| [added: ​] | [added: ​] | [removed: 2018] [added: 2019] vs. [removed: 2017] [added: 2018] | | | | | | | | | | | [added: ​] | [added: ​] | [removed: 2017] [added: 2018] vs. [removed: 2016] [added: 2017] | | | | | | | | | |

_Risk_ _Factors_.

Revenues from our collection operations are influenced by factors such as collection frequency, type of

These factors generally correlate to volumes of waste generated and impact our revenue.

We experienced growth in our collection and disposal lines of business, particularly in the segments of our business driven by the consumer portion of the economy.

Overall in 2019, our landfill volumes were favorably impacted by growth in our municipal solid waste business, clean-up efforts from natural disasters in California during 2019 and event-driven projects.

The portion of our business driven by the industrial segment of the economy, such as special waste, continues to show growth, although the pace of growth is starting to moderate as large industrial customers take a more cautious approach to awarding work for special projects.

Additionally, we continued our focus on developing a sustainable recycling business model that meets customers’ environmental needs, but is also economically sustainable.

Given pressures on the business from lower market values for recycled commodities and higher contamination fees, we have been working to improve its financial returns by driving a fee-based pricing model that addresses the cost of processing materials and the impact on our costs of contamination.

These efforts provided significant value to our 2019 results, though that value was more than offset by continued declines in market prices for recycled commodities.

We will continue to take steps necessary to improve long-term profitability of our recycling line of business.

Overall, the Company’s operations performed well in 2019.

We expect the Company’s industry-leading asset network and strategic focuses on investing in people, technology and growth to drive continued growth in the year ahead.

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| | ● | Selling, general and administrative expenses of $1,631 million in 2019, or 10.6% of revenues, compared with $1,453 million, or 9.7% of revenues, in 2018. This increase of $178 million is primarily attributable to (i) higher costs associated with planned investments in our people and technology; (ii) increased acquisition-related costs and (iii) litigation reserves; |

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| | ● | Income from operations of $2,706 million, or 17.5% of revenues, in 2019 compared with $2,789 million, or 18.7% of revenues, in 2018. Although 2019 benefited from strong operating results, primarily in our collection and disposal business, and the favorable impact of a year-over-year increase in federal natural gas fuel credits, cost inflation across various cost categories, costs associated with investments in our people and technology, acquisition-related costs and goodwill impairments drove a reduction in income from operations as compared with 2018. Additionally, 2018 was favorably impacted by net gains associated with the sale of certain collection and disposal operations and certain ancillary operations, partially offset by the impairment of a landfill; |

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| | ● | Net income attributable to Waste Management, Inc. was $1,670 million, or $3.91 per diluted share, compared with $1,925 million, or $4.45 per diluted share, in the prior year period. In addition to the decrease in income from operations, the current year was impacted by (i) increased depreciation and amortization expense related to new collection fleet and increased landfill volume; (ii) an $85 million loss on early extinguishment of debt; (iii) a $52 million impairment charge related to our minority-owned investment in a waste conversion technology business that was not deductible for tax purposes and (iv) a $27 million impairment of goodwill. Additionally, the prior year period was favorably impacted by net gains associated with the sale of operations discussed above; |

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| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

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| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| ​ | ​ | ​ | ​ | ​ | As a % of | ​ | ​ | ​ | ​ | ​ | As a % of | | ​ | ​ | ​ | ​ | As a % of | | ​ | ​ | ​ | ​ | As a % of | |

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| (c) | Includes net impact of commodity price variability and changes in fees. |

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| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| ​ | ​ | ​ | ​ | ​ | ​ | As a % of | | ​ | ​ | ​ | As a % of | ​ |

Our strategic pricing efforts focus on ensuring we overcome inflationary cost pressures and grow margins.

This strategy has been most successful in our collection line of business for both 2019 and 2018.

We are also experiencing solid growth in our landfill and transfer businesses, with our municipal solid waste business experiencing 3.8% and 2.2% average yield growth for the years ended December 31, 2019 and 2018, respectively, as compared with the prior year periods.

We partially offset our revenue decline by assessing fees to cover the higher costs of handling contaminated recycling materials.

We have seen a decreased demand from paper mills around the world which had driven prices to historical low averages.

There are several domestic mill projects anticipated to start during 2020 that we expect will add additional capacity and more local demand for recycled materials.

However, we do not expect material changes in market prices for recycling commodities as a result of this additional capacity.

Risk Factors.

Our “Traditional Solid Waste” business excludes our recycling and resource recovery services.

We are not expecting any significant shift in the near term, but there is increased market volatility and uncertainty about longer-term macro-economic indicators.

Disruptions in the global movement of recycling commodities, due in part to actions by the Chinese government, resulted in significantly lower average markets prices in 2018 compared to 2017; however, we currently expect market price declines for recycling commodities to moderate in 2019.

The recycling industry is continuing to adapt to the heightened quality standards and regulations.

In addition, we are also focusing on managing processing costs, developing alternative markets and educating customers to reduce contamination in the recycling stream.

Net income and earnings per diluted share both increased primarily as a result of the strong operating results from our Traditional Solid Waste business as well as the favorable impact on our effective tax rate due to enactment of tax reform.

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| | · | | Selling, general and administrative expenses of $1,453 million in 2018, or 9.7% of revenues, compared with $1,468 million, or 10.1% of revenues, in 2017. This decrease of $15 million is primarily attributable to lower incentive compensation accruals partially offset by increased professional fees and bad debt expense; |

| | · | | Income from operations of $2,789 million, or 18.7% of revenues, in 2018 compared with $2,636 million, or 18.2% of revenues, in 2017, an increase of $153 million; |

| | · | | Net income attributable to Waste Management, Inc. of $1,925 million, or $4.45 per diluted share, for 2018 as compared with $1,949 million, or $4.41 per diluted share, for 2017. The comparability is impacted by an increase in the effective income tax rate in the current year period of 19% compared with 11% in the prior year period primarily due to the one-time impacts associated with enactment of tax reform in late 2017. The current year was favorably impacted by (i) improved operating results in our Traditional Solid Waste business and (ii) net gains associated with the sale of certain hauling and ancillary operations. Partially offsetting these increases was lower earnings from our recycling line of business due to lower market prices for recycling commodities and the impairment of a landfill; |

expanded service offerings and solutions.

These operations are presented in our “Other” segment in the table below.

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Other | | 2,487 | | | 2,538 | | | 2,278 |

| | | | | | | | | | | |

| Intercompany (b) | | | | (3,110) | | | (2,885) | | | (2,637) |

| Total | | | $ | 14,914 | | $ | 14,485 | | $ | 13,609 |

| | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | As a % of | | | | | | As a % of | | | | | | As a % of | | | | | | As a % of | |

We experienced growth in yield for all of our collection and disposal lines of business in both 2018 and 2017.

The period-to-period changes are as follows (dollars in millions):

| | | | | | | | | | | | | |

| | | | | | | As a % of | | | | | As a % of | |

Our increase in collection and disposal yield for the years ended December 31, 2018 and 2017, compared with the prior years, includes increased revenues from our environmental fees of $74 million and $67 million, respectively.

Disruptions in the global movement of recycling commodities began in September 2017 and continued throughout 2018.

We currently expect market prices for recycling commodities to moderate in 2019.

The comparison does not include volumes from acquisitions.

Contributors to our volume increase in both 2018 and 2017 included a large new contract addition in the second half of 2017 that continued to favorably impact volume growth for our commercial collection business into 2018.

The clean-up efforts of natural disasters throughout the U.S. in the second half of 2017 favorably affected our landfill volumes primarily in the fourth quarter of 2017 as compared with 2016 but negatively impacted the comparability of volumes for 2018.

Drivers affecting the comparability of volumes for 2017 and 2016 included a volume increase from an eleven-month outage at a waste-to-energy facility in Virginia that ended in mid-December 2017 offset, in part, by one less workday in 2017 that negatively impacted our volume growth.

operating equipment; (vii) disposal and franchise fees and taxes, which include landfill taxes, municipal franchise fees, host community fees, contingent landfill lease payments and royalties; (viii) landfill operating costs, which include interest accretion on landfill liabilities, interest accretion on and discount rate adjustments to environmental remediation liabilities and recovery assets, leachate and methane collection and treatment, landfill remediation costs and other landfill site costs; (ix) risk management costs, which include general liability, automobile liability and workers’ compensation claims programs costs and (x) other operating costs, which include gains and losses on sale of assets, telecommunications, equipment and facility lease expenses, property taxes, utilities and supplies.

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| Subcontractor costs | | 1,375 | | | 139 | | 11.2 | | | | 1,236 | | | 43 | | 3.6 | | | 1,193 | |

| Cost of goods sold | | 783 | | | (186) | | (19.2) | | | | 969 | | | 111 | | 12.9 | | | 858 | |

| Fuel | | 409 | | | 34 | | 9.1 | | | | 375 | | | 75 | | 25.0 | | | 300 | |

| Risk management | | 235 | | | 16 | | 7.3 | | | | 219 | | | 27 | | 14.1 | | | 192 | |

| Other | | 455 | | | (20) | | (4.2) | | | | 475 | | | 46 | | 10.7 | | | 429 | |

The Company had no derivatives outstanding as of December 31, [removed: 2018.][added: 2019.]

[removed: Interest] [added: _Interest] Rate Exposure [removed: —] [added: —_] Our exposure to market risk for changes in interest rates relates primarily to our financing activities.

As of December 31, [removed: 2018,] [added: 2019,] we had [removed: $10.1] [added: $13.6] billion of long-term debt, excluding the impacts of accounting for debt issuance costs, discounts, premiums and fair value adjustments attributable to terminated interest rate derivatives.

We have [removed: $2.2] [added: $1.0] billion of debt that is exposed to changes in market interest rates within the next 12 months comprised of (i) [removed: $990 million of short-term borrowings under our commercial paper program; (ii) $705] [added: $669] million of tax-exempt bonds with term interest rate periods that expire within the next 12 [removed: months; (iii) $513] [added: months and (ii) $355] million of variable-rate tax-exempt bonds that are subject to repricing on either a daily or weekly [removed: basis and (iv) C$15 million, or $11 million, of Canadian borrowings under our $2.75 billion revolving credit facility.][added: basis.]

We currently estimate that a [removed: 100‑basis] [added: 100-basis] point increase in the interest rates of our outstanding variable-rate debt obligations would increase our [removed: 2019] [added: 2020] interest expense by [removed: $19] [added: $7] million.

[removed: An instantaneous, 100‑basis point] increase in interest rates across all maturities attributable to these instruments would have decreased the fair value of our debt by approximately [removed: $575 million] [added: $1.0 billion] as of December 31, [removed: 2018.][added: 2019.]

We also invest a portion of our restricted trust and escrow account balances in available-for-sale securities, including U.S. Treasury securities, U.S. agency securities, municipal securities, mortgage- and asset-backed securities and equity [removed: securities.][added: securities, which generally mature over the next 10 years.]

[removed: Commodity] [added: _Commodity] Price Exposure [removed: —] [added: —_] In the normal course of our business, we are subject to operating agreements that expose us to market risks arising from changes in the prices for commodities such as diesel fuel; recyclable materials, including old corrugated cardboard, old newsprint and plastics; and electricity, which generally correlates with natural gas prices in many of the markets in which we operate.

[removed: Currency] [added: _Currency] Rate Exposure [removed: —] [added: —_] We have operations in Canada as well as certain support functions in India.

An instantaneous, 100-basis point

For details on the financial position, results of operations and cash flows of WM, WM Holdings and their subsidiaries, see Note [removed: 21] [added: 22] to the Consolidated Financial Statements.

Our telephone number is (713) [removed: 512‑6200.][added: 512-6200.]

Our annual reports on Form [removed: 10‑K,] [added: 10-K,] quarterly reports on Form [removed: 10‑Q] [added: 10-Q] and current reports on Form [removed: 8‑K] [added: 8-K] are all available, free of charge, on our website as soon as practicable after we file the reports with the SEC.

Our “Solid Waste” business is operated and managed locally by our subsidiaries that focus on distinct geographic areas and [removed: provides] [added: provide] collection, transfer, disposal, and recycling and resource recovery services.

During [removed: 2018,] [added: 2019,] our largest customer represented [removed: 1%] [added: less than 2%] of annual revenues.

We employed approximately [removed: 43,700] [added: 44,900] people as of December 31, [removed: 2018.][added: 2019.]

We own or operate [removed: 252] [added: 249] landfill sites, which is the largest network of landfills in North America.

In order to make disposal more practical for larger urban markets, where the distance to landfills is typically farther, we manage [removed: 314] [added: 302] transfer stations that consolidate, compact and transport waste efficiently and economically.

We provide cost-efficient, environmentally sound recycling programs for municipalities, businesses and households across the U.S. and Canada as well as other services that supplement our [removed: Traditional] Solid Waste business.

In December [removed: 2018,] [added: 2019,] we announced that our Board of Directors expects to increase the quarterly dividend from [removed: $0.465 to] $0.5125 [added: to $0.545] per share for dividends declared in [removed: 2019,] [added: 2020,] which is a [removed: 10.2%] [added: 6.3%] increase from the quarterly dividends we declared in [removed: 2018.][added: 2019.]

This is an indication of our ability to generate strong and consistent cash flows and marks the [removed: 16th] [added: 17th] consecutive year of dividend increases.

See Note [removed: 19] [added: 20] to the Consolidated Financial Statements for additional information about our reportable segments.

[added: _Collection._] Our commitment to customers begins with a vast waste collection network.

| | [removed: · |] [added: ●] | For commercial and industrial collection services, typically we have a three-year service agreement. The fees under the agreements are influenced by factors such as collection frequency, type of collection equipment we furnish, type and volume or weight of the waste collected, distance to the disposal facility, labor costs, cost of disposal and general market factors. As part of the service, we provide steel containers to most customers to store their solid waste between pick-up dates. Containers vary in size and type according to the needs of our customers and the restrictions of their communities. Many are designed to be lifted mechanically and either emptied into a truck’s compaction hopper or directly into a disposal site. By using these containers, we can service most of our commercial and industrial customers with trucks operated by only one employee. |

| | [removed: · |] [added: ●] | For most residential collection services, we have a contract with, or a franchise granted by, a municipality, homeowners’ association or some other regional authority that gives us the exclusive right to service all or a portion of the homes in an area. These contracts or franchises are typically for periods of three to [removed: ten] [added: 10] years. We also provide services under individual monthly subscriptions directly to households. The fees for residential collection are either paid by the municipality or authority from their tax revenues or service charges, or are paid directly by the residents receiving the service. |

[added: _Landfill._] Landfills are the main depositories for solid waste in North America.

As of December 31, [removed: 2018,] [added: 2019,] we owned or operated [removed: 247] [added: 244] solid waste landfills and five secure hazardous waste landfills, which represents the largest network of [removed: landfills in North America.]

[added: A landfill must] meet federal, state or provincial, and local regulations during its design, construction, operation and closure.

[added: _Transfer._] As of December 31, [removed: 2018,] [added: 2019,] we owned or operated [removed: 314] [added: 302] transfer stations in North America.

[added: _Recycling._] Our recycling operations provide communities and businesses with an alternative to traditional landfill disposal and support our strategic goals to extract more value from the materials we manage.

[removed: Materials] [added: _Materials] processing [removed: —] [added: —_] Through our collection operations, we collect recyclable materials from residential, commercial and industrial customers and direct these materials to one of our MRFs for processing.

As of December 31, [removed: 2018,] [added: 2019,] we operated [removed: 102] [added: 103] MRFs where paper, cardboard, metals, plastics, glass, construction and demolition materials and other recycling commodities are recovered for resale or redirected for other purposes.

[removed: Recycling] [added: _Recycling] commodities [removed: —] [added: —_] We market and resell recycling commodities globally.

[removed: Recycling] [added: _Recycling] brokerage [removed: services] [added: services_] — We also provide recycling brokerage services, which involve managing the marketing of recyclable materials for third parties.

[added: _Other._] Other services we provide include the following:

The U.S. Environmental Protection Agency (“EPA”) endorses landfill gas as a renewable energy resource, in the [added: same category as wind, solar and geothermal resources.]

[removed: As of December 31, 2018, we had 130 landfill gas beneficial use] projects producing commercial quantities of methane gas at owned or operated landfills.

For [removed: 101] [added: 97] of these projects, the processed gas is used to fuel electricity generators.

For [removed: 14] [added: 12] of these projects, the gas is used at the landfill or delivered by pipeline to industrial customers as a direct substitute for fossil fuels in industrial processes.

The solutions and services include the collection of project waste, including construction debris and household or yard waste, through our Bagster® program; the development, operation and marketing of plasma gasification facilities; operation of a landfill gas-to-liquid natural gas plant; [removed: solar powered trash compactors] and organic waste-to-fuel conversion technology.

As companies, individuals and communities look for ways to be more sustainable, we are [removed: investing in greener technologies and] promoting our comprehensive services that go beyond our core business of collecting and disposing of [removed: waste.][added: waste in order to meet their needs.]

Our operating revenues tend to be somewhat higher in summer months, primarily due to [removed: the] higher construction and demolition waste volumes.

Service disruptions caused by severe storms, extended periods of inclement weather or climate extremes resulting from climate change can significantly affect the operating results of the Areas [removed: affected.][added: impacted.]

On the other hand, certain destructive weather and climate conditions, such as wildfires in the Western U.S. and hurricanes that most often impact our operations in the Southern and Eastern U.S. during the second half of the year, can increase our revenues in the Areas [removed: affected.][added: affected as a result of the waste volumes generated by these events.]

While weather-related and other event driven special projects can boost revenues through additional work for a limited time, [removed: as a result of] [added: due to] significant start-up costs and other factors, such revenue can generate earnings at comparatively lower margins.

As of December 31, [removed: 2018,] [added: 2019,] we had approximately [removed: 43,700] [added: 44,900] full-time employees, of which approximately [removed: 8,200] [added: 8,600] were employed in administrative and sales positions and the balance in operations.

Approximately [removed: 8,300] [added: 8,400] of our employees are covered by collective bargaining agreements.

Letters of credit generally are supported by our long-term U.S. and Canadian revolving credit facility [removed: (“$2.75] [added: (“$3.5] billion revolving credit facility”) and other credit facilities established for that purpose.

We carry a broad range of insurance coverages, including [added: health and welfare,] general liability, automobile liability, workers’ compensation, real and personal property, directors’ and officers’ liability, pollution legal liability and other coverages we believe are customary to the industry.

[removed: In December 2017, we elected to] [added: We] use a wholly-owned insurance captive to insure the deductibles for our general liability, automobile liability and workers’ compensation claims programs.

We are enabling a people-first, technology-led focus, that leverages and sustains the strongest asset network in the industry to drive best-in-class customer experience and growth.

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landfills in North America.

As of December 31, 2019, we had 124 landfill gas beneficial use

The regulatory environment in which we operate is influenced by changes in leadership at the federal, state, provincial and local levels.

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| | ● | With regard to regulatory developments under RCRA, the EPA published an advance notice of proposed rulemaking in December 2018 to consider whether to propose revisions to the municipal solid waste landfill criteria to support advances in liquids management. Although the notice does not reopen any existing regulations, we have been working closely with the EPA to ensure that the agency is aware of how future regulation could impact our industry. In July 2019, the EPA announced increases in the user fees accompanying the system that the agency uses to track hazardous waste shipments electronically. Later in 2019, the U.S. Department of Energy finalized a rule setting forth the fee that the agency will charge for the long-term storage and management of elemental mercury. Neither announcement is anticipated to adversely impact the Company’s hazardous business units, and we are working closely with both agencies to minimize risks more broadly to our industry. |

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| | ● | With regard to regulatory requirements pertaining to greenhouse gas emissions, since 2014, decisions from the U.S Supreme Court and U.S. Court of Appeals for the D.C Circuit, as well as EPA policy memoranda, have significantly narrowed the applicability and scope of EPA permitting requirements for GHGs from stationary sources, including with respect to biogenic carbon dioxide (“CO2”) permitting. In 2016, the EPA proposed revisions to the Prevention of Significant Deterioration (“PSD”) and Title V Greenhouse Gas (“GHG”) permitting regulations establishing a significant emissions rate (“SER”) threshold, below which sources would not be required to implement additional control technologies for their GHG emissions. This SER threshold should prevent most of our operational changes, such as landfill expansions and beneficial gas recovery projects, from being subject to PSD or Title V permit requirements due to our GHG emissions – assuming the EPA classifies biogenic CO2 emissions from municipal solid waste and landfill gas as carbon neutral. The EPA has not yet finalized this rulemaking. The EPA also has not yet finalized its policy for addressing biogenic CO2 emissions from waste management; however, the EPA’s independent Science Advisory Board has recommended it treat waste-derived CO2 emissions as carbon neutral. These judicial and regulatory actions have reduced, and are expected to continue to reduce, the potential impact of the PSD and Title V GHG Tailoring Rule on our air permits, compliance and operating requirements. |

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If the U.S. were

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| | ● | In August 2016, the EPA published two rules to update the 1996 standards with new requirements for landfill gas control and monitoring at both new municipal solid waste landfills (constructed or modified after July 17, 2014) as well as existing landfills (operating after November 8, 1987, and not modified after July 17, 2014). Working with our trade associations and other landfill owners and operators, we identified significant legal, technical and implementation concerns with the rules and together filed a judicial appeal of the rules while also filing administrative petitions asking that the EPA stay the rules and initiate a rulemaking process. We also alerted the EPA that its August 2016 rulemakings led to an inconsistent regulatory structure in which six separate overlapping and inconsistent sets of work practices now govern the disposal industry. In May 2017, the EPA granted our industry’s administrative petitions for reconsideration and rulemaking, signaling its intent to reconsider its 2016 rulemakings. However, the agency continues to move forward with two additional rulemaking packages (a federal plan to implement the 2016 rule for existing landfills and revisions to the existing MACT rule) that could lead to further regulatory confusion. We cannot predict the outcome of any of these ongoing rulemaking processes; however, we do not believe any such regulatory changes will have a material adverse impact on our business as a whole. |

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In recent years, the Chinese government has announced bans on certain materials and begun to enforce extremely

restrictive quality and other requirements that have significantly reduced China’s import of recyclables.

It is currently anticipated that China will ban the import of recyclables completely in 2021.

Such trade restrictions and tariffs have disrupted the global trade of recyclables, particularly fiber, creating excess supply and decreasing recyclable commodity prices.

The heightened quality requirements have been difficult for the industry to achieve and have driven up operating costs.

As recyclable commodity prices have fallen and operating costs have increased, recyclers are seeking to pass cost increases through to customers.

The resulting price increase for recycling services in communities and at businesses in the U.S. has resulted in some customers reducing or eliminating their recycling service.

We have continued our focus on developing a sustainable recycling business model that meets customers’ environmental needs by passing through the increasing cost of processing and higher contamination rates, and these efforts had a positive impact on the operating results for our recycling business in 2019.

Over 800 pieces of legislation, approximately 50% of which are bans on plastic bags, have been introduced in the U.S. regulating plastics: 660 passed, including 585 city ordinances.

Others include bans on the sale or use of plastic straws, polystyrene plastic and single use packaging.

With increased focus on responsible management of plastics, we have taken a proactive approach to collaborate with buyers to ensure environmental sustainability goals are prioritized in managing the product we sell.

There is increasing pressure to reduce the use of fossil fuel in the heavy-duty truck industry, and some cities and states are beginning to discuss requirements for using more advanced engine technology, such as electric powered vehicles, rather than natural gas or diesel vehicles.

Although current options for heavy-duty electric vehicles lack sufficient range and proven experience for our operations, requirements to transition to electric powered vehicles could increase our cost of vehicles and impair our investment in our natural gas fleet and infrastructure.

Our “Traditional Solid Waste” business excludes our recycling and resource recovery services.

Collection.

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Landfill.

A landfill must

Transfer.

Recycling.

See Note 2 to the Consolidated Financial Statements for additional information.

Other.

same category as wind, solar and geothermal resources.

In recent years, we perceived an increase in both the amount of government regulation and the number of enforcement actions being brought by regulatory entities against operations in the waste services industry.

| | · | | The Federal Water Pollution Control Act of 1972, as amended, known as the Clean Water Act, regulates the discharge of pollutants into streams, rivers, groundwater, or other surface waters from a variety of sources, including solid and hazardous waste disposal sites. If our operations discharge any pollutants into surface waters, the Clean Water Act requires us to apply for and obtain discharge permits, conduct sampling and monitoring, |

| --- |

The EPA and the Department of Transportation finalized Greenhouse Gas Emissions and Fuel Efficiency Standards for Medium and Heavy-Duty Engines and Vehicles – Phase 2 on August 16, 2016.

The rule will increase fuel economy standards and reduce vehicle emissions standards for our collection fleet between model years 2021 and 2027.

We expect to be able to purchase fully compliant vehicles that will meet our operational needs, and while the regulations could increase the costs of operating our fleet, we do not believe any such regulations would have a material adverse impact on our business as a whole.

| | · | | In 2010, the EPA issued the Prevention of Significant Deterioration (“PSD”) and Title V Greenhouse Gas (“GHG”) Tailoring Rule, which expanded the EPA’s federal air permitting authority to include the six GHGs, including methane and carbon dioxide. The rule sets new thresholds for GHG emissions that define when Clean Air Act permits are required. The requirements of these rules have not significantly affected our operations or cash flows, due to the tailored thresholds and exclusions of certain emissions from regulation. |

Since 2014, decisions from the U.S Supreme Court and U.S. Court of Appeals for the D.C Circuit, as well as EPA policy memorandum, have significantly narrowed the applicability and scope of EPA permitting requirements for GHGs from stationary sources, including with respect to biogenic carbon dioxide (“CO2”) permitting.

In

2016, the EPA proposed revisions to the PSD and Title V GHG permitting regulations establishing a significant emissions rate (“SER”) threshold, below which sources would not be required to implement additional control technologies for their GHG emissions.

This SER threshold should prevent most of our operational changes, such as landfill expansions and beneficial gas recovery projects, from being subject to PSD or Title V permit requirements due to our GHG emissions – assuming the EPA classifies biogenic CO2 emissions from municipal solid waste and landfill gas as carbon neutral.

The EPA has not yet finalized this rulemaking.

The EPA also has not yet finalized its policy for addressing biogenic CO2 emissions from waste management; however, the EPA’s independent Science Advisory Board has recommended it treat waste-derived CO2 emissions as carbon-neutral.

These recent judicial and regulatory actions have reduced, and are expected to continue to reduce, the potential impact of the PSD and Title V GHG Tailoring Rule on our air permits, compliance and operating requirements.

See Item 1A.

Risk Factors — The adoption of climate change legislation or regulations restricting emissions of “greenhouse gases” could increase our costs to operate.

However, the EPA under the current administration is reviewing the implementation of the new NAAQS and considering revisions to make the regulations less stringent.

While we cannot predict the ultimate outcome of potential revisions to NAAQS, we do not believe that the ultimate requirements will have a material adverse impact on our business as a whole.

cases, releases and cleanup of hazardous substances and liabilities for such matters.

In 2013, the Chinese government began to strictly enforce regulations that establish limits on moisture and non-conforming materials that may be contained in imported recycled paper and plastics and restrict the import of certain other plastic recyclables.

In 2017, the Chinese government announced a ban on certain materials, including mixed waste paper and mixed plastics, effective January 1, 2018, as well as extremely restrictive quality requirements effective March 1, 2018 that have been difficult for the industry to achieve.

In addition, other countries have limited or restricted the import of certain recyclables.

The use of restrictions on import licenses to restrict flow into China continued in 2018 and is expected to continue to constrict in 2019.

Additionally, increased container weight tracking and port fees have driven up operating costs in the recycling industry and have resulted in increased price volatility.

In response, China has imposed new tariffs on the import of recyclable commodities, including wastepaper, plastics and metals.

Such restrictions and tariffs may have a significant impact on our recycling operations.

However, there is uncertainty about the industry’s ability to adapt to the stricter quality expectations.

We have been actively working to identify alternative markets for recycled commodities, but it is possible there may not be sufficient demand for all of the material we produce, resulting in price decreases and volatility.

Bans on single use plastic bags, straws, and polystyrene food containers have been passed in over 350 cities, and a ban on single use plastic bags has been implemented in the State of California.

We have partnered with the environmental organization Environmental Defense Fund, as well as other heavy-duty equipment users and experts, on an emissions study to be made available to policy makers.

Information regarding our legal proceedings can be found under the [removed: Environmental Matters] [added: _Environmental Matters_] and [removed: Litigation] [added: _Litigation_] sections of Note [removed: 10] [added: 11] to the Consolidated Financial Statements included within this report.

[removed: UNITED] [added: UNITED] STATES SECURITIES AND EXCHANGE [removed: COMMISSION][added: COMMISSION]

[removed: Washington,] [added: Washington,] D.C. [removed: 20549][added: 20549]

☑ [removed: ANNUAL] [added: ANNUAL] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE [removed: SECURITIES AND] [added: SECURITIES AND] EXCHANGE ACT OF [removed: 1934][added: 1934]

[removed: For] [added: For] the fiscal year [removed: ended December] [added: ended December] 31, [removed: 2018][added: 2019]

☐ [removed: TRANSITION] [added: TRANSITION] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE [removed: SECURITIES AND] [added: SECURITIES AND] EXCHANGE ACT OF [removed: 1934][added: 1934]

[removed: For] [added: For] the transition period from [removed: to][added: to]

[removed: Commission] [added: Commission] file [removed: number 1-12154][added: number 1-12154]

[removed: (Exact] [added: _(Exact] name of registrant as specified in its [removed: charter)][added: charter)_]

| [removed: Delaware] [added: Delaware] | [removed: 73-1309529] [added: 73-1309529] |

| [removed: (State] [added: _(State] or other jurisdiction [removed: of] [added: of_] | [removed: (I.R.S. Employer] [added: _(I.R.S. Employer_] |

| [removed: incorporation] [added: _incorporation] or [removed: organization)] [added: organization)_] | [removed: Identification No.)] [added: _Identification No.)_] |

| [removed: 1001] [added: 1001] Fannin [removed: Street] [added: Street] | [added: ​] |

| [removed: Houston, Texas] [added: Houston, Texas] | [removed: 77002] [added: 77002] |

| [removed: (Address] [added: _(Address] of principal executive [removed: offices)] [added: offices)_] | [removed: (Zip code)] [added: _(Zip code)_] |

[removed: Registrant’s] [added: _Registrant’s] telephone number, including area [removed: code:][added: code:_]

[removed: (713) 512-6200][added: (713) 512-6200]

[removed: Securities] [added: Securities] registered pursuant to Section 12(b) of the [removed: Act:][added: Act:]

| [removed: Title] [added: Title] of Each [removed: Class] [added: Class] | [removed: Name] [added: Trading Symbol | Name] of Each Exchange on Which [removed: Registered] [added: Registered] |

| Common Stock, $0.01 par value | [added: WM |] New York Stock Exchange |

Yes ☑ No [removed: ☐][added: ◻]

Yes [removed: ☐] [added: ◻] No ☑

| Large accelerated filer | ☑ | Accelerated filer [removed: ☐] [added: ◻] |

| Non-accelerated filer | [removed: ☐] [added: ◻] | Smaller reporting company ☐ |

The aggregate market value of the voting stock held by non-affiliates of the registrant as of June 30, [removed: 2018] [added: 2019] was approximately [removed: $34.8] [added: $48.8] billion.

The number of shares of Common Stock, $0.01 par value, of the registrant outstanding as of February [removed: 8, 2019] [added: 7, 2020] was [removed: 423,779,540] [added: 424,708,758] (excluding treasury shares of [removed: 206,502,921).][added: 205,573,703).]

[removed: DOCUMENTS] [added: DOCUMENTS] INCORPORATED BY [removed: REFERENCE][added: REFERENCE]

| [removed: Document] [added: Document] | | [removed: Incorporated] [added: Incorporated] as [removed: to] [added: to] |

| Proxy Statement for the [removed: 2019] [added: 2020] Annual Meeting of Stockholders | [added: ​] | Part III |

| [added: ​] | [added: ​] | [removed: Page] [added: Page] |

| [added: ​] | [removed: [PART I](#PARTI_995551)] [added: [PART I](#PARTI_995551)] | [added: ​] |

| [Item 1B.](#Item1BUnresolvedStaffComments_347325) | [Unresolved Staff Comments](#Item1BUnresolvedStaffComments_347325) | [removed: 27] [added: 29] |

| [Item 2.](#Item2Properties_696453) | [Properties](#Item2Properties_696453) | [removed: 27] [added: 29] |

| [Item 3.](#Item3LegalProceedings_313163) | [Legal Proceedings](#Item3LegalProceedings_313163) | [removed: 27] [added: 30] |

| [Item 4.](#Item4MineSafetyDisclosures_74576) | [Mine Safety Disclosures](#Item4MineSafetyDisclosures_74576) | [removed: 27] [added: 30] |

| [added: ​] | [removed: [PART II](#PARTII_847799)] [added: [PART II](#PARTII_847799)] | [added: ​] |

| [Item 5.](#Item5MarketforRegistrantsCommon_605372) | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#Item5MarketforRegistrantsCommon_605372) | [removed: 28] [added: 31] |

| [Item 6.](#Item6SelectedFinancialData_572231) | [Selected Financial Data](#Item6SelectedFinancialData_572231) | [removed: 30] [added: 32] |

| [Item 7.](#Item7ManagementsDiscussion_595297) | [Management’s Discussion and Analysis of Financial Condition and Results of Operations](#Item7ManagementsDiscussion_595297) | [removed: 30] [added: 32] |

| [Item 7A.](#Item7AQuantitative_14076) | [Quantitative and Qualitative Disclosures About Market Risk](#Item7AQuantitative_14076) | [removed: 56] [added: 59] |

| [Item 8.](#Item8FinancialStatements_338840) | [Financial Statements and Supplementary Data](#Item8FinancialStatements_338840) | [removed: 57] [added: 61] |

s

​

OR

| ​ | ​ |

| ​ | ​ |

| ​ | ​ | ​ |

Yes ☑ No ◻

Yes ☑ No ◻

| ​ | | ​ |

| ​ | ​ | ​ |

| --- | --- | --- |

​

10-K 1 wm-20181231x10k.htm 10-K

OR

| | |

| --- | --- |

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulations S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

| | | |

Our principal property and equipment [removed: consists] [added: consist] of land (primarily landfills and other disposal facilities, transfer stations and bases for collection operations), buildings, vehicles and equipment.

[removed: Management’s] [added: _Management’s] Discussion and Analysis of Financial Condition and Results of [removed: Operations] [added: Operations_] included within this report.

| Landfills owned or operated (a) | | [removed: 252] [added: 249] | | [removed: 249] [added: 252] |

| Transfer stations | | [removed: 314] [added: 302] | | [removed: 305] [added: 314] |

| Material recovery facilities | | [removed: 102] [added: 103] | | [removed: 90] [added: 102] |

| | [removed: (a) | | As of December 31, 2018 and 2017, our landfills owned or operated consisted of total acreage of 157,369 and 156,784;] permitted [removed: acreage of 42,730 and 42,590; and expansion acreage of 944 and 821, respectively. Total acreage includes permitted] acreage, expansion acreage, other acreage available for future disposal that has not been permitted, buffer land and other land. Permitted acreage consists of all acreage at the landfill encompassed by an active permit to dispose of waste. Expansion acreage consists of unpermitted acreage where the related expansion efforts meet our criteria to be included as expansion airspace. A discussion of the related criteria is included within Item 7. [removed: Management’s] [added: _Management’s] Discussion and Analysis of Financial Condition and Results of [removed: Operations] [added: Operations_] — [removed: Critical] [added: _Critical] Accounting Estimates and [removed: Assumptions] [added: Assumptions_] included within this report. |

We plan to relocate our principal executive offices within Houston, Texas during 2020.

| ​ | ​ | ​ | ​ | ​ |

| ​ | | 2019 | | 2018 |

| (a) | As of December 31, 2019 and 2018, our landfills owned or operated consisted of total acreage of 159,080 and 157,369; permitted acreage of 42,992 and 42,730; and expansion acreage of 795 and 944, respectively. Total acreage includes |

| --- | --- |

| --- | --- |

| | | | | |

| | | 2018 | | 2017 |

| --- | --- | --- | --- |

Our common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “WM.” The number of holders of record of our common stock on February [removed: 8, 2019] [added: 7, 2020] was [removed: 8,942.][added: 8,712.]

[removed: ][added: ]

| Dow Jones Waste & Disposal Services Index | [added: ​] | $ | 100 | [added: ​] | $ | [removed: 114] [added: 104] | [added: ​] | $ | [removed: 119] [added: 126] | [added: ​] | $ | [removed: 144] [added: 148] | [added: ​] | $ | [removed: 168] [added: 148] | [added: ​] | $ | [removed: 168] [added: 200] |

During [removed: 2018,] [added: 2019,] we repurchased an aggregate of [removed: $1,008] [added: $244] million of our common stock under accelerated share repurchase [removed: (“ASR”)] agreements and open market repurchases, which equated to [removed: 11.7] [added: 2.3] million shares with a weighted average price per share of [removed: $86.35.][added: $108.60.]

See Note [removed: 13] [added: 14] to the Consolidated Financial Statements for additional information.

Any future share repurchases will be made at the discretion of management and will depend on various factors including our net earnings, financial [removed: condition,] [added: condition and] cash required for future business plans, [removed: and] growth and acquisitions.

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| ​ | | 12/31/14 | | | 12/31/15 | | | 12/31/16 | | | 12/31/17 | | | 12/31/18 | | | 12/31/19 | |

| Waste Management, Inc. | ​ | $ | 100 | ​ | $ | 107 | ​ | $ | 146 | ​ | $ | 182 | ​ | $ | 192 | ​ | $ | 250 |

| S&P 500 Index | ​ | $ | 100 | ​ | $ | 101 | ​ | $ | 114 | ​ | $ | 138 | ​ | $ | 132 | ​ | $ | 174 |

In December 2019, we publicly confirmed that the Company has $1.32 billion remaining on its existing Board of Directors’ authorization for future share repurchases.

| | | | | | | | | | | | | | | | | | | |

| | | 12/31/13 | | | 12/31/14 | | | 12/31/15 | | | 12/31/16 | | | 12/31/17 | | | 12/31/18 | |

| Waste Management, Inc. | | $ | 100 | | $ | 118 | | $ | 127 | | $ | 173 | | $ | 215 | | $ | 226 |

| S&P 500 Index | | $ | 100 | | $ | 114 | | $ | 115 | | $ | 129 | | $ | 157 | | $ | 150 |

We announced in December 2017 that the Board of Directors authorized up to $1.25 billion in future share repurchases.

The following table summarizes common stock repurchases made during the fourth quarter of 2018 (shares in millions):

Issuer Purchases of Equity Securities

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | Total Number of | | | | |

| | | Total | | | | | Shares Purchased as | | Approximate Maximum | | |

| | | Number of | | Average | | | Part of Publicly | | Dollar Value of Shares that | | |

| | | Shares | | Price Paid | | | Announced Plans or | | May Yet be Purchased Under | | |

| Period | | Purchased | | per Share | | | Programs | | the Plans or Programs | | |

| October 1 — 31 | | 2.8 | | $ | 89.60 | (a) | 2.8 | | $ | 252 million | |

| November 1 — 30 | | — | | $ | — | | — | | $ | 252 million | |

| December 1 — 31 | | 0.5 | | $ | 88.88 | (b) | 0.5 | | $ | 1.5 billion | (c) |

| Total | | 3.3 | | $ | 89.49 | | 3.3 | | | | |

| | (a) | | In October 2018, we completed an ASR agreement that was entered into in July 2018 to repurchase $200 million of our common stock. At the beginning of the repurchase period, we delivered $200 million in cash and received 1.8 million shares. The ASR agreement completed in October 2018, at which time we received 0.4 million additional shares. At the beginning of October, subsequent to the completion of the July 2018 ASR agreement, we repurchased 0.5 million shares of our common stock in open market transactions in compliance with Rule 10b5-1 and Rule 10b‑18 of the Exchange Act for $48 million, inclusive of per-share commissions. |

| --- | --- | --- | --- |

At the end of October 2018, we entered into a new ASR agreement to repurchase $200 million of our common stock.

At the beginning of the repurchase period, we delivered $200 million in cash and received 1.9 million shares.

The October 2018 ASR agreement completed in December 2018.

The “Average Price Paid per Share” in the table represents the final weighted average price per share paid for the completed ASR agreements and the open market repurchases.

| | (b) | | In December 2018, we completed the October 2018 ASR agreement discussed above at which time we received 0.4 million additional shares. Subsequent to the completion of the October 2018 ASR agreement, we repurchased an additional 0.1 million shares of our common stock in open market transactions in compliance with Rule 10b5-1 and Rule 10b-18 of the Exchange Act for $10 million, inclusive of per-share commissions. The “Average Price Paid per Share” in the table represents the final weighted average price per share paid for the completed ASR agreement and the open market repurchases. |

| | (c) | | We announced in December 2018 that the Board of Directors has authorized up to $1.5 billion in future share repurchases, which supersedes and replaces remaining authority under any prior Board of Directors authorization for share repurchases after the completion of our current open market repurchase plan ending February 15, 2019. |

| [added: ​] | [added: ​] | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | | | | |

| | | [removed: 2018(a)] [added: 2019(a)] | | | [removed: 2017(a)] [added: 2018(a)] | | | [removed: 2016(a)] [added: 2017(a)] | | | [removed: 2015] [added: 2016] | | | [removed: 2014] [added: 2015] | |

| [added: ​] | [added: ​] | [removed: (In] [added: (In] Millions, Except per Share [removed: Amounts)] [added: Amounts)] | | | | | | | | | | | | | |

| [removed: Statement] [added: Statement] of Operations [removed: Data:] [added: Data:] | | [added: ​] | | | [added: ​] | | | [added: ​] | | | [added: ​] | | | [added: ​] | |

| Operating revenues | [added: ​] | $ | [removed: 14,914] [added: 15,455] | [added: ​] | $ | [removed: 14,485] [added: 14,914] | [added: ​] | $ | [removed: 13,609] [added: 14,485] | [added: ​] | $ | [removed: 12,961] [added: 13,609] | [added: ​] | $ | [removed: 13,996] [added: 12,961] |

| Consolidated net income | [added: ​] | | [added: 1,671 | ​ | |] 1,923 | [added: ​] | | 1,949 | [added: ​] | | 1,180 | [added: ​] | | 752 | [removed: | | 1,338 |]

| Net income attributable to Waste Management, Inc. | [added: ​] | | [added: 1,670 | ​ | |] 1,925 | [added: ​] | | 1,949 | [added: ​] | | 1,182 | [added: ​] | | 753 | [removed: | | 1,298 |]

| Basic earnings per common share | [added: ​] | | [added: 3.93 | ​ | |] 4.49 | [added: ​] | | 4.44 | [added: ​] | | 2.66 | [added: ​] | | 1.66 | [removed: | | 2.80 |]

| Diluted earnings per common share | [added: ​] | | [added: 3.91 | ​ | |] 4.45 | [added: ​] | | 4.41 | [added: ​] | | 2.65 | [added: ​] | | 1.65 | [removed: | | 2.79 |]

| [removed: Balance] [added: Balance] Sheet [removed: Data:] [added: Data:] | [added: ​] | | | [added: ​] | | | [added: ​] | | | [added: ​] | | | [added: ​] | | |

| Working capital (deficit) (b) | [added: ​] | $ | [removed: (463)] [added: 3,065] | [added: ​] | $ | [removed: (568)] [added: (463)] | [added: ​] | $ | [removed: (418)] [added: (568)] | [added: ​] | $ | [removed: (165)] [added: (418)] | [added: ​] | $ | [removed: 41] [added: (165)] |

| Total assets [added: (b)] | [added: ​] | | [added: 27,743 | ​ | |] 22,650 | [added: ​] | | 21,829 | [added: ​] | | 20,859 | [added: ​] | | 20,367 | [removed: | | 21,252 |]

| Long-term debt, including current portion | [added: ​] | | [added: 13,498 | ​ | |] 10,026 | [added: ​] | | 9,491 | [added: ​] | | 9,310 | [added: ​] | | 8,929 | [removed: | | 9,390 |]

| Total Waste Management, Inc. stockholders’ equity | [added: ​] | | [added: 7,068 | ​ | |] 6,275 | [added: ​] | | 6,019 | [added: ​] | | 5,297 | [added: ​] | | 5,345 | [removed: | | 5,866 |]

| Total equity | [added: ​] | | [added: 7,070 | ​ | |] 6,276 | [added: ​] | | 6,042 | [added: ​] | | 5,320 | [added: ​] | | 5,367 | [removed: | | 5,889 |]

| [removed: |] (a) | [removed: |] For more information see Item 7. [removed: Management’s] [added: _Management’s] Discussion and Analysis of Financial Condition and Results of [removed: Operations.] [added: Operations_.] |

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| --- | --- |

| (b) | For disclosures associated with the impact of the adoption of new accounting standards on the comparability of this information, see Note 2 to the Consolidated Financial Statements included in this report. |

| --- | --- |

| | | | | | | | | | | | | | | | |

| Cash dividends declared per common share | | | 1.86 | | | 1.70 | | | 1.64 | | | 1.54 | | | 1.50 |

| --- | --- | --- | --- |

| | (b) | | Prior year information was revised to conform to our current year presentation. |

| [added: ​] | | [removed: Page] [added: Page] |

| [Reports of Independent Registered Public Accounting Firm](#REPORTOFINDEPENDENTREGISTEREDPUBLICACCOU) | [added: ​] | [removed: 58] [added: 62] |

| [Consolidated Balance Sheets as of December 31, [removed: 2018] [added: 2019] and [removed: 2017](#BALANCESHEETS_191365)] [added: 2018](#BALANCESHEETS_191365)] | [added: ​] | [removed: 60] [added: 67] |

| [Consolidated Statements of Operations for the Years Ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016](#STATEMENTSOFOPERATIONS_745891)] [added: 2017](#STATEMENTSOFOPERATIONS_745891)] | [added: ​] | [removed: 61] [added: 68] |

| [Consolidated Statements of Comprehensive Income for the Years Ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016](#COMPREHENSIVEINCOME_932746)] [added: 2017](#COMPREHENSIVEINCOME_932746)] | [added: ​] | [removed: 61] [added: 68] |

| [Consolidated Statements of Cash Flows for the Years Ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016](#CASHFLOWS_594152)] [added: 2017](#CASHFLOWS_594152)] | [added: ​] | [removed: 62] [added: 69] |

| [Consolidated Statements of Changes in Equity for the Years Ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016](#CHANGESINEQUITY_625544)] [added: 2017](#CHANGESINEQUITY_625544)] | [added: ​] | [removed: 63] [added: 70] |

| [Notes to Consolidated Financial Statements](#NOTESTOCONSOLIDATEDFINANCIALSTATEMENTS_4) | [added: ​] | [removed: 64] [added: 71] |

[removed: REPORT] [added: REPORT] OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING [removed: FIRM][added: FIRM]

[removed: The] [added: To the] Board of Directors and Stockholders of Waste Management, Inc.

[removed: Opinion] [added: Opinion] on Internal Control over Financial [removed: Reporting][added: Reporting]

We have audited Waste Management, Inc.’s internal control over financial reporting as of December 31, [removed: 2018,] [added: 2019,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, Waste Management, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2018,] [added: 2019,] based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the [removed: 2018] [added: 2019] consolidated financial statements of the Company, and our report dated February [removed: 14, 2019] [added: 13, 2020] expressed an unqualified opinion thereon.

[removed: Basis] [added: Basis] for [removed: Opinion][added: Opinion]

[removed: Definition] [added: Definition] and Limitations of Internal Control Over Financial [removed: Reporting][added: Reporting]

| [added: ​] | /s/ ERNST & YOUNG LLP |

| Houston, Texas February [removed: 14, 2019] [added: 13, 2020] | [added: ​] |

[removed: Opinion] [added: Opinion] on the Financial [removed: Statements][added: Statements]

We have audited the accompanying consolidated balance sheets of Waste Management, Inc. (the Company) as of December 31, [removed: 2018] [added: 2019] and [removed: 2017,] [added: 2018,] the related consolidated statements of operations, comprehensive income, cash flows, and changes in equity for each of the three years in the period ended December 31, [removed: 2018,] [added: 2019,] and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, [removed: 2018] [added: 2019] and [removed: 2017,] [added: 2018,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2018,] [added: 2019,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, [removed: 2018,] [added: 2019,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February [removed: 14, 2019] [added: 13, 2020] expressed an unqualified opinion thereon.

| We have served as the Company’s auditor since 2002. | [added: ​] |

[removed: WASTE MANAGEMENT, INC.][added: | Waste Management, Inc. stockholders’ equity: | ​ | | | ​ | | |]

[removed: (In] [added: (In] Millions, Except Share and Par Value [removed: Amounts)][added: Amounts)]

| [added: ​] | [removed: December 31,] [added: ​] | [added: December 31,] | | | | [added: |]

| [added: ​] | [removed: 2018] | [added: 2019] | | [removed: 2017] | [added: 2018] | [added: | | 2017 | |]

| [removed: ASSETS] [added: ASSETS] | [added: ​] | [added: ​] | [added: ​] | [added: ​] | [added: ​] | [added: ​ |]

| Current assets: | [added: ​] | [added: ​] | | [added: ​] | [added: ​] | [added: |]

| Cash and cash equivalents | [added: ​ |] $ | [added: — | ​ | $ | — | ​ | $ |] 61 | [added: ​] | $ | [removed: 22] [added: —] | [added: ​ | $ | 61 |]

| Accounts receivable, net of allowance for doubtful accounts of [removed: $29] [added: $28] and [removed: $21,] [added: $29,] respectively | [added: ​] | [removed: 1,931] | [added: 1,949] | [added: ​] | [removed: 1,805] | [added: 1,931 |]

| Other receivables | [added: ​] | [removed: 344] | [added: 370] | [added: ​] | [removed: 569] | [added: 344 |]

| Parts and supplies | [added: ​] | [removed: 102] | [added: 106] | [added: ​] | [removed: 96] | [added: 102 |]

| Other assets | [added: ​] | [removed: 207] | [added: 223] | [added: ​] | [removed: 202] | [added: 207 |]

| Total current assets | [added: ​] | [removed: 2,645] | [added: 6,209] | [added: ​] | [removed: 2,694] | [added: 2,645 |]

| Property and equipment, net of accumulated depreciation and amortization of [removed: $18,264] [added: $18,657] and [removed: $17,704,] [added: $18,264,] respectively | [added: ​] | [removed: 11,942] | [added: 12,893] | [added: ​] | [removed: 11,559] | [added: 11,942 |]

| Goodwill | [added: ​] | [removed: 6,430] | [added: 6,532] | [added: ​] | [removed: 6,247] | [added: 6,430 |]

| Other intangible assets, net | [added: ​] | [removed: 572] | [added: 521] | [added: ​] | [removed: 547] | [added: 572 |]

| Restricted trust and escrow accounts | [added: ​] | [removed: 296] | [added: 313] | [added: ​] | [removed: 249] | [added: 296 |]

| Investments in unconsolidated entities | [added: ​] | [removed: 406] | [added: 483] | [added: ​] | [removed: 269] | [added: 406 |]

​

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

​

Adoption of ASU No. 2016-02 (Topic 842)

As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for leases in the 2019 financial statements to reflect the accounting method change due to the adoption of ASU No. 2016-02, _Leases (Topic 842)_, and the related amendments.

Basis for Opinion

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

| ​ | ​ ​ |

| _Description of the Matter_ | At December 31, 2019, the Company’s landfill assets totaled $6.6 billion and the associated amortization expense for 2019 was $575 million. As discussed in Note 3 of the financial statements, the Company updates the estimates used to calculate individual landfill amortization rates at least annually, or more often if significant facts change. Landfill amortization rates are used in the computation of landfill amortization expense. ​ Auditing landfill amortization rates and related amortization expense is complex due to the highly judgmental nature of assumptions used in estimating the rates. Significant assumptions used in the calculation of the rates include: estimated future development costs associated with the construction and retirement of the landfill, estimated remaining permitted airspace and unpermitted expansion airspace, airspace utilization factors, projected annual tonnage intakes, and projected timing of retirement activities. ​ |

| _How We Addressed the Matter in Our Audit_ | We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s controls over determining landfill amortization rates and calculating amortization expense. Our audit procedures included, among others, testing controls over: the Company’s process for evaluating and updating the significant assumptions used in the development of the landfill amortization rates, management’s review of those significant assumptions, and the mathematical accuracy of the calculation and recording of amortization expense. ​ To test the landfill asset amortization rates, our audit procedures included, among others, assessing methodologies used by the Company and testing the significant assumptions discussed above, inclusive of the underlying data used by the Company in its development of these assumptions. We compared the significant assumptions used by management to historical trends and, when available, to comparable size landfills accepting a similar type of waste. Regarding unpermitted expansion airspace, we evaluated the Company’s criteria for inclusion in remaining airspace. In addition, we considered the professional qualifications and objectivity of management’s internal engineers responsible for developing the assumptions. We involved EY’s engineering specialists to assist with the application of these procedures. We also tested the completeness and accuracy of the historical data utilized in the development of the landfill amortization rates. |

| ​ | ​ |

| ​ | Landfill – Final Capping, Closure and Post-Closure Costs |

| _Description of the Matter_ | At December 31, 2019, the carrying value of the Company’s landfill asset retirement obligations related to final capping, closure and post-closure costs totaled $1.9 billion. As discussed in Note 3 of the financial statements, the Company updates the estimates used to measure the asset retirement obligations annually, or more often if significant facts change. ​ Auditing the landfill asset retirement obligation is complex due to the highly judgmental nature of the assumptions used in the measurement process. These assumptions include: estimated future costs associated with the capping, closure and post closure activities at each specific landfill; airspace consumed to date in relation to total estimated permitted airspace; the projected annual tonnage intake; and the projected timing of retirement activities. ​ |

| | ​ ​ ​ ​ |

| _How We Addressed the Matter in Our Audit_ | We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s controls over the calculation of asset retirement obligations. Our audit procedures included, among others, testing the Company’s controls over the landfill asset retirement obligation estimation process and management’s review of the significant |

| | assumptions used in the estimation of the liability, including the amount and timing of retirement costs. ​ To test the landfill asset retirement obligation valuation, we performed audit procedures that included, among others, assessing methodologies used by the Company, testing the completeness of activities included in the estimate (e.g., gas monitoring and extraction), and testing the significant assumptions discussed above, inclusive of the underlying data used by the Company in its development of these assumptions. We compared the significant assumptions used by management to historical trends and, when available, to comparable size landfills accepting the same type of waste. In addition, we considered the professional qualifications and objectivity of management’s internal engineers responsible for developing the assumptions. We involved EY and external engineering specialists to assist us with these procedures. Specifically, we utilized the EY engineering specialists to evaluate the reasons for significant changes in assumptions from the historical trend, and to determine whether the change from the historical trend was appropriate and identified timely. We utilized the external engineers to evaluate the estimates of remaining landfill airspace. We also tested the completeness and accuracy of the historical data utilized in preparing the estimate. ​ |

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| ​ | Environmental Remediation Liabilities |

| _Description of the Matter_ | At December 31, 2019, environmental remediation liabilities totaled $240 million. As discussed in Note 3 of the financial statements, the Company performs a review of sites that require remediation and prepares cost estimates for the anticipated remedy using internal resources and, as needed, external resources (e.g., environmental engineers). The Company estimates the costs required to remediate sites based on: site-specific facts and circumstances; input from third party engineers or management’s judgment and experience in remediating their own and unrelated parties’ sites; and information available from regulatory agencies as to costs of remediation. The liability recorded by the Company represents its estimated share of the total obligation to remediate the site. The number of other potentially responsible parties (PRP’s) who may be liable for remediation of a specific site, their financial resources, and their relative degree of responsibility are used to determine the Company’s estimated share of the total obligation. Where the amount of an environmental remediation liability and the timing of the payments are fixed or reliably determinable, the forecasted cost is inflated until the expected time of payment and then discounted back to the present value. ​ Auditing environmental remediation liabilities is complex due to the highly judgmental nature of the assumptions used in the estimate. Significant judgment can be involved in determining whether the environmental liability is reasonably estimable. If the liability is determined to be reasonably estimable, significant assumptions used in the accounting for environmental remediation liabilities include: estimating the internal and external costs directly associated with site investigation and clean up, potential settlements with regulatory bodies or other affected parties, and legal and consultant fees; as well as determining the degree to which the remediation obligation is shared with other parties. ​ |

| | ​ ​ ​ |

| --- | --- |

| _How We Addressed the Matter in Our Audit_ | We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s controls over the calculation of environmental remediation liabilities. Our audit procedures included, among others, testing controls over management’s review of: the estimated costs to perform the remedial obligation, as provided by a regulatory agency or determined by a PRP group or internal engineers; the identification of PRPs and the Company’s assumptions regarding the degree of responsibility for the action; and management’s controls over the completeness and accuracy of the calculated remediation liability. ​ To test the environmental liabilities, we performed audit procedures that included, among others, assessing methodologies used by the Company and testing the significant assumptions discussed above, as well as the underlying costs and other estimates used by the Company in its development of these assumptions. We compared the significant assumptions used by management to historical data and trends, or to notifications or decisions from regulatory agencies or the PRP group specifying remedial plans of action required, as available. When appropriate to discount the liability, we evaluate the appropriateness of the discount rate and inflation rate utilized and the accuracy of the computation. We also involve EY engineering specialists to assist us with evaluating the completeness of the Company’s environmental liabilities. |

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| ​ | /s/ ERNST & YOUNG LLP |

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| Houston, Texas February 13, 2020 | ​ |

| ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| Loss on early extinguishment of debt | ​ | ​ | (85) | ​ | ​ | — | ​ | ​ | (6) |

​

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

​

(In Millions)

| ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |

| Depreciation and amortization | ​ | | 1,574 | ​ | | 1,477 | ​ | | 1,376 |

| Loss on early extinguishment of debt | ​ | ​ | 85 | ​ | ​ | — | ​ | ​ | 6 |

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| Balance, December 31, 2015 | | $ | 5,367 | | 630,282 | | $ | 6 | | $ | 4,827 | | $ | 6,939 | | $ | (127) | | (183,105) | | $ | (6,300) | | $ | 22 |

| Cash dividends | | | (726) | | — | | | — | | | — | | | (726) | | | — | | — | | | — | | | — |

| Cash dividends | | | (750) | | — | | | — | | | — | | | (750) | | | — | | — | | | — | | | — |

| Cash dividends | | | (802) | | — | | | — | | | — | | | (802) | | | — | | — | | | — | | | — |

On January 1, 2018, we adopted ASU 2014-09 using the modified retrospective approach for all ongoing customer contracts.

The impact of adopting the amended guidance primarily relates to (i) the deferral of certain sales incentives, which previously were expensed as incurred, but under the new guidance are capitalized as other assets and amortized to selling, general and administrative expenses over the expected life of the customer relationship and (ii) the recognition of certain consideration payable to our customers as a reduction in operating revenues, which under historical guidance was recorded as operating expenses.

We recognized a net $80 million increase to our retained earnings as of January 1, 2018 for the cumulative impact of adopting the amended guidance associated with the capitalization of sales incentives as contract acquisition costs consisting of a $108 million asset and a related $28 million deferred tax liability.

There were no material impacts on our consolidated financial statements, which include these changes, as a result of our adoption of this amended guidance.

For contracts with an effective term greater than one year, we applied the standard’s practical expedient that permits the exclusion of unsatisfied performance obligations as our right to consideration corresponds directly to the value provided to the customer for services completed to date and all future variable consideration is allocated to wholly unsatisfied performance obligations.

We also applied the standard’s optional exemption for performance obligations related to contracts that have an original expected duration of one year or less.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Financial Instruments — In January 2016, the FASB issued ASU 2016‑01 associated with the recognition and measurement of financial assets and liabilities with further clarifications made in February 2018 with the issuance of ASU 2018-03.

The amended guidance requires certain equity investments that are not consolidated and not accounted for under the equity method to be measured at fair value with changes in fair value recognized in net income rather than as a component of accumulated other comprehensive income (loss).

It further states that an entity may choose to measure equity investments that do not have readily determinable fair values using a quantitative approach, or measurement alternative, which is equal to its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.

We concluded that all equity investments within the scope of ASU 2016-01, which primarily relate to equity securities previously accounted for under the cost method, do not have readily determinable fair values.

Accordingly, the value of these investments beginning January 1, 2018 has been measured using a quantitative approach, or the measurement alternative, as noted above.

Statement of Cash Flows — In August 2016, the FASB issued ASU 2016‑15 associated with the classification of certain cash receipts and cash payments in the statement of cash flows.

In November 2016, the FASB issued ASU 2016‑18 associated with the presentation of restricted cash and cash equivalents in the statement of cash flows.

The objective of the amended guidance was to reduce existing diversity in practice.

This amended guidance was retrospectively adopted on January 1, 2018 and required the following disclosures and changes to the presentation of our financial statements:

| | · | | Cash, cash equivalents and restricted cash and cash equivalents reported on the Consolidated Statements of Cash Flows now includes restricted cash and cash equivalents of $65 million, $62 million and $271 million as of December 31, 2015, 2016 and 2017, respectively, in restricted trust and escrow accounts and other current assets in our Consolidated Balance Sheets as well as previously reported cash and cash equivalents. |

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| | · | | Cash payments made within 120 days of the acquisition date of a business combination to settle a contingent consideration liability are classified as cash outflows from investing activities. Thereafter, cash payments up to the amount of the contingent consideration liability recognized at the acquisition date (including measurement period adjustments) are classified as cash outflows from financing activities and any excess is classified as cash outflows from operating activities. The adoption of this amended guidance did not have a material impact on our Consolidated Statements of Cash Flows. |

Our restricted cash and cash equivalents generally consist of funds deposited into specific accounts for purposes of funding insurance claims and demonstrating our ability to meet our landfill final capping, closure, post-closure and environmental remediation obligations.

Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income — In February 2018, the FASB issued ASU 2018-02 associated with the reclassification of certain tax effects from accumulated other comprehensive income (loss).

This amended guidance allows a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act (the “Act”) which was signed into law on December 22, 2017.

We early adopted this amended guidance on January 1, 2018, and as a result, elected to reclassify $5 million of stranded tax effects from accumulated other comprehensive income (loss) to retained earnings using a specific identification approach.

Income Taxes — In March 2018, the FASB issued ASU 2018-05 associated with the accounting and disclosures around the enactment of the Act and the Securities and Exchange Commission’s Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”), which the Company has adopted.

See Note 8 for the disclosures related to this amended guidance.

The amended guidance is effective for the Company on January 1, 2020.

We are assessing the provisions of this amended guidance and evaluating the impact on our consolidated financial statements.

Leases — In February 2016, the FASB issued ASU 2016‑02 associated with lease accounting.

Disclosure of key information about leasing arrangements will also be required.

These practical expedients must be elected as a package and consistently applied.

We have elected to apply the package of practical expedients upon adoption.

Based on such evaluation, our principal executive and financial officers have concluded that such disclosure controls and procedures were effective as of December 31, [removed: 2018] [added: 2019] (the end of the period covered by this Annual Report on Form [removed: 10‑K).][added: 10-K).]

Management of the Company, including the principal executive and financial officers, is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules [removed: 13a‑15(f)] [added: 13a-15(f)] and [removed: 15d‑15(f)] [added: 15d-15(f)] of the Securities Exchange Act of 1934, as amended.

| | i. | [removed: |] pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; |

| | ii. | [removed: |] provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and |

| | iii. | [removed: |] provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements. |

Management of the Company assessed the effectiveness of our internal control over financial reporting as of December 31, [removed: 2018] [added: 2019] based on the Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework).

Based on this assessment, management has concluded that our internal control over financial reporting was effective as of December 31, [removed: 2018.][added: 2019.]

Management, together with our CEO and CFO, evaluated the changes in our internal control over financial reporting during the quarter ended December 31, [removed: 2018.][added: 2019.]

We determined that there were no changes in our internal control over financial reporting during the quarter ended December 31, [removed: 2018] [added: 2019] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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The information required by this Item is incorporated by reference to the sections entitled “Board of Directors,” [removed: “Section] [added: “Delinquent Section] 16(a) [removed: Beneficial Ownership Reporting Compliance,”] [added: Reports,”] and “Executive Officers,” in the Company’s definitive Proxy Statement for its [removed: 2019] [added: 2020] Annual Meeting of Stockholders (the “Proxy Statement”), to be held May [removed: 14, 2019.][added: 12, 2020.]

The code of ethics, entitled “Code of Conduct,” is posted on our website at www.wm.com [removed: under] [added: in] the section [removed: “Corporate] [added: “ESG — Corporate] Governance” [removed: within] [added: on] the [removed: “Investor Relations” tab.][added: “Investors” page.]

Consolidated Balance Sheets as of December 31, [removed: 2018] [added: 2019] and [removed: 2017][added: 2018]

Consolidated Statements of Operations for the years ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016][added: 2017]

Consolidated Statements of Comprehensive Income for the years ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016][added: 2017]

Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016][added: 2017]

Consolidated Statements of Changes in Equity for the years ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016][added: 2017]

| [removed: Exhibit No.] [added: Exhibit No.] | [added: ​] | [removed: Description] [added: Description] |

| 3.1 | — | [Third Restated Certificate of Incorporation of Waste Management, Inc. \[incorporated by reference to Exhibit 3.1 to Form [removed: 10‑Q] [added: 10-Q] for the quarter ended June 30, 2010\].](http://www.sec.gov/Archives/edgar/data/823768/000095012310070947/h74168exv3w1.htm) |

| 3.2 | — | [Amended and Restated By-laws of Waste Management, Inc. \[incorporated by reference to Exhibit 3.2 to Form [removed: 8‑K] [added: 8-K] dated [removed: February] [added: November] 19, [removed: 2018\].](http://www.sec.gov/Archives/edgar/data/823768/000110465918011700/a18-6740_1ex3d2.htm)] [added: 2019\].](http://www.sec.gov/Archives/edgar/data/823768/000110465919065833/tm1923428d1_ex3-2.htm)] |

| 4.1 | — | [Specimen Stock Certificate \[incorporated by reference to Exhibit 4.1 to Form [removed: 10‑K] [added: 10-K] for the year ended December 31, 1998\].](http://www.sec.gov/Archives/edgar/data/823768/0000950129-99-001268.txt) |

| 4.2 | — | [Third Restated Certificate of Incorporation of Waste Management Holdings, Inc. \[incorporated by reference to Exhibit 4.2 to Form [removed: 10‑K] [added: 10-K] for the year ended December 31, 2014\].](http://www.sec.gov/Archives/edgar/data/823768/000095012315002550/d793975dex42.htm) |

| 4.3 | — | [Amended and Restated By-laws of Waste Management Holdings, Inc. \[incorporated by reference to Exhibit 4.3 to Form [removed: 10‑Q] [added: 10-Q] for the quarter ended June 30, 2014\].](http://www.sec.gov/Archives/edgar/data/823768/000119312514283972/d740524dex43.htm) |

| 4.4 | — | [Indenture for Subordinated Debt Securities dated February 3, 1997, among the Registrant and The Bank of New York Mellon Trust Company, N.A. (the current successor to Texas Commerce Bank National Association), as trustee \[incorporated by reference to Exhibit 4.1 to Form [removed: 8‑K] [added: 8-K] dated February 7, 1997\].](http://www.sec.gov/Archives/edgar/data/823768/0000950129-97-000380.txt) |

| 4.5 | — | [Indenture for Senior Debt Securities dated September 10, 1997, among the Registrant and The Bank of New York Mellon Trust Company, N.A. (the current successor to Texas Commerce Bank National Association), as trustee \[incorporated by reference to Exhibit 4.1 to Form [removed: 8‑K] [added: 8-K] dated September 10, 1997\].](http://www.sec.gov/Archives/edgar/data/823768/0000950129-97-003909.txt) |

| 4.6 | — | [Officers’ Certificate delivered pursuant to Section 301 of the Indenture dated September 10, 1997 by and between Waste Management, Inc. and The Bank of New York Mellon Trust Company, N.A., as Trustee, establishing the terms and form of Waste Management, Inc.’s [removed: 3.150%] [added: 4.150%] Senior Notes due [removed: 2027] [added: 2049] \[incorporated by reference to Exhibit [removed: 4.6] [added: 4.5] to Form [removed: 10-K] [added: 10-Q] for the [removed: year] [added: quarter] ended [removed: December 31, 2017\].](http://www.sec.gov/Archives/edgar/data/823768/000155837018000716/wm-20171231ex46aca6a46.htm)] [added: June 30, 2019\].](http://www.sec.gov/Archives/edgar/data/823768/000155837019006306/wm-20190630ex451df486a.htm)] |

| 4.7 | — | [Guarantee Agreement by Waste Management Holdings, Inc. in favor of The Bank of New York Mellon Trust Company, N.A., as Trustee for the holders of Waste Management, Inc.’s [removed: 3.150%] [added: 4.150%] Senior Notes due [removed: 2027] [added: 2049] \[incorporated by reference to Exhibit [removed: 4.7] [added: 4.10] to Form [removed: 10-K] [added: 10-Q] for the [removed: year] [added: quarter] ended [removed: December 31, 2017\].](http://www.sec.gov/Archives/edgar/data/823768/000155837018000716/wm-20171231ex47349167a.htm)] [added: June 30, 2019\].](http://www.sec.gov/Archives/edgar/data/823768/000155837019006306/wm-20190630ex410c32e50.htm)] |

| 4.8* | — | [Schedule of Officers’ Certificates delivered pursuant to Section 301 of the Indenture dated September 10, 1997 establishing the terms and form of Waste Management, Inc.’s Senior Notes. Waste Management and its subsidiaries are parties to debt instruments that have not been filed with the SEC under which the total amount of securities authorized under any single instrument does not exceed 10% of the total assets of Waste Management and its subsidiaries on a consolidated basis. Pursuant to paragraph 4(iii)(A) of Item 601(b) of Regulation S-K, Waste Management agrees to furnish a copy of such instruments to the SEC upon [removed: request.](https://www.sec.gov/Archives/edgar/data/823768/000155837019000662/wm-20181231ex48109ff5b.htm)] [added: request.](https://www.sec.gov/Archives/edgar/data/823768/000155837020000762/ex-4d8.htm)] |