þ
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
95-6021257
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification Number)
|
|
|
|
445 South Street, Morristown, NJ
|
|
07960
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
|
Name of each exchange on which registered
|
Common Stock, $0.10 par value per share
|
|
New York Stock Exchange
|
Large accelerated filer
þ
|
Accelerated filer
o
|
Non-accelerated filer
o
|
Smaller reporting
company
o
|
Emerging growth
company
o
|
|
|
(Do not check if a smaller
reporting company)
|
|
|
Class
|
|
Outstanding at February 8, 2019
|
Common Stock, $0.10 par value
|
|
131,059,818
|
Part of Form 10-K of Covanta Holding Corporation
|
|
Documents Incorporated by Reference
|
Part III
|
|
Portions of the Proxy Statement to be filed with the Securities and Exchange Commission in connection with the 2019 Annual Meeting of Stockholders.
|
|
|
|
|
|
|
|
|
|
Page
|
|
||||
|
||||
|
||||
|
|
|||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
||||
|
|
|||
|
|
|||
|
|
|||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
||||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
||||
|
|
|||
|
||||
|
|
|
•
|
seasonal or long-term fluctuations in the prices of energy, waste disposal, scrap metal and commodities;
|
•
|
our ability to renew or replace expiring contracts at comparable prices and with other acceptable terms;
|
•
|
adoption of new laws and regulations in the United States and abroad, including energy laws, environmental laws, tax laws, labor laws and healthcare laws;
|
•
|
failure to maintain historical performance levels at our facilities and our ability to retain the rights to operate facilities we do not own;
|
•
|
our ability to avoid adverse publicity or reputational damage relating to our business;
|
•
|
advances in technology;
|
•
|
difficulties in the operation of our facilities, including fuel supply and energy delivery interruptions, failure to obtain regulatory approvals, equipment failures, labor disputes and work stoppages, and weather interference and catastrophic events;
|
•
|
difficulties in the financing, development and construction of new projects and expansions, including increased construction costs and delays;
|
•
|
our ability to realize the benefits of long-term business development and bear the cost of business development over time;
|
•
|
limits of insurance coverage;
|
•
|
our ability to avoid defaults under our long-term contracts;
|
•
|
performance of third parties under our contracts and such third parties' observance of laws and regulations;
|
•
|
concentration of suppliers and customers;
|
•
|
geographic concentration of facilities;
|
•
|
increased competitiveness in the energy and waste industries;
|
•
|
changes in foreign currency exchange rates;
|
•
|
limitations imposed by our existing indebtedness and our ability to perform our financial obligations and guarantees and to refinance our existing indebtedness;
|
•
|
exposure to counterparty credit risk and instability of financial institutions in connection with financing transactions;
|
•
|
the scalability of our business;
|
•
|
our ability to attract and retain talented people;
|
•
|
failures of disclosure controls and procedures and internal controls over financial reporting;
|
•
|
our ability to utilize net operating loss carryforwards;
|
•
|
general economic conditions in the United States and abroad, including the availability of credit and debt financing;
|
•
|
restrictions in our certificate of incorporation and debt documents regarding strategic alternatives; and
|
•
|
other risks and uncertainties affecting our business described in
Item 1A. Risk Factors
of this Annual Report on Form 10-K and in other filings by Covanta with the SEC.
|
•
|
Preserve and grow the value of our existing portfolio.
We intend to maximize the long-term value of our existing portfolio of facilities by continuously improving safety, health and environmental performance, working to provide superior customer service, continuing to operate at our historic production levels, maintaining our facilities in optimal condition, extending waste and service contracts, and conducting our business more efficiently. We intend to achieve organic growth by expanding our customer base, service offerings and metal recovery, adding waste, service or energy contracts, investing in and enhancing the capabilities of our existing assets, and deploying new or improved technologies, systems, processes and controls, all targeted at increasing revenue or reducing costs.
|
•
|
Expand through project development and/or acquisitions in selected attractive markets.
We seek to grow our portfolio, primarily through development of new facilities or businesses, competitive bids for new contracts, and acquisitions, where we believe that market opportunities will enable us to utilize our skills and/or invest our capital at attractive risk-adjusted rates of return. We focus these efforts in markets where we currently have projects in operation or under construction, and in other markets with strong economic fundamentals and predictable legal and policy support. In addition to our focus on EfW and related waste sourcing activities, we are seeking to expand our environmental service offerings through both organic growth and acquisitions.
|
•
|
Develop and commercialize new technology.
We believe that our efforts to protect and expand our business will be enhanced by the development of additional technologies in such fields as recycling, alternative waste treatment processes, combustion controls, emission controls and residue recycling, reuse or disposal. We have advanced our research and development efforts in some of these areas relevant to our EfW business, and have patents and patents pending for advances in controlling emissions.
|
•
|
Advocate for public policy favorable to EfW and other sustainable waste and materials management solutions.
We seek to educate policymakers and regulators about the environmental and economic benefits of EfW and advocate for policies and regulations that appropriately reflect these benefits. Our business is highly regulated, and as such we believe that it is critically important for us, as an industry leader, to play an active role in the debates surrounding potential policy developments that could impact our business.
|
•
|
Maintain a focus on sustainability.
Providing sustainable waste, materials, and energy services to our customers is the cornerstone of our business. Our corporate culture is focused on the triple bottom line of sustainability (people, planet, prosperity) in support of our mission. In addition to robust financial reporting, we are committed to transparently reporting our environmental, social and governance standards, policies, and performance through our corporate sustainability report. We seek to continuously improve our performance across these aspects to remain an industry leader.
|
•
|
Allocate capital efficiently for long-term shareholder value.
We plan to allocate capital to maximize shareholder value by: investing in our existing businesses to maintain and enhance assets; investing in new projects and strategic acquisitions that offer attractive returns on invested capital and further our strategic goals; maintaining a strong balance sheet; and consistently returning capital to our shareholders.
|
•
|
$133 million
declared in dividends to stockholders; and
|
•
|
$130 million
for growth investments, including
$16 million
for business development in the UK,
$13 million
in preparation for services to be provided to a second marine transfer station under our New York City transportation and disposal contract,
$50 million
for acquisitions, and
$24 million
for various organic growth investments, which included metals recovery projects, ash processing technology and investments related to our profiled waste and environmental services businesses.
|
•
|
Service fee operating contract at our Huntington facility for an additional 5 years through 2024;
|
•
|
Service fee operating contract at our Huntsville facility for an additional 5 years through 2023;
|
•
|
Service fee operating contract at our Montgomery County facility for an additional 5 years through 2026; and
|
•
|
Power purchase agreement at our Marion County facility for an additional 15 years through 2034.
|
•
|
During the second quarter of 2018, we made a decision to cease operations at our EfW facility in Warren County, New Jersey due to ongoing challenges with the economic performance of the facility. The shutdown is expected to occur in mid-2019. For further information see in
Item 8. Financial Statements And Supplementary Data —
Note 10. Supplementary Information
.
|
•
|
In July 2018, we sold our equity interests in a hydroelectric facility located in the state of Washington for proceeds of approximately
$12 million
. For further information see in
Item 8. Financial Statements And Supplementary Data —
Note 4. Dispositions and Assets Held for Sale
.
|
•
|
In September 2018, we amended our service agreement with the City of Long Beach, California. Under the amendment, the City of Long Beach will invest approximately
$9 million
and we will invest an additional
$5 million
for facility maintenance which will allow for opportunities to process higher-value waste. These capital investments aim to ensure continued sustainable operation of the facility.
|
|
|
Tip Fee
|
|
Service Fee
(Covanta Owned)
|
|
Service Fee
(Client Owned)
|
Number of facilities:
|
|
20
|
|
4
|
|
18
|
Client(s):
|
|
Host community and municipal and commercial waste customers
|
|
Host community, with limited merchant capacity in some cases
|
|
Dedicated to host community exclusively
|
Waste or service
revenue:
|
|
Per ton “tipping fee”
|
|
Fixed fee, with performance incentives and inflation escalation
|
||
Energy revenue:
|
|
Covanta retains 100%
|
|
Share with client
(Covanta retains approximately 20% on average)
|
||
Metals revenue:
|
|
Covanta retains 100%
|
|
Share with client
(Covanta typically retains approximately 50%)
|
||
Operating costs:
|
|
Covanta responsible for all operating costs
|
|
Pass through certain costs to client
(e.g. ash disposal)
|
||
Project debt service:
|
|
Covanta project subsidiary responsible
|
|
Paid by client explicitly as part of service fee
|
|
Client responsible for debt service
|
After service contract
expiration:
|
|
N/A
|
|
Covanta owns the facility; clients have certain rights set forth in contracts; facility converts to Tip Fee or remains Service Fee with new terms
|
|
Client owns the facility; extend with Covanta or tender for new contract
|
(1)
|
These facilities either sell electricity into the regional power pool at prevailing market rates or have contractual arrangements to sell electricity at prevailing market rates
|
(2)
|
These facilities use a refuse-derived fuel technology.
|
(3)
|
These facilities have been designed to export steam for sale. See table below for the equivalent electric output. The equivalent electric output is part of, not in addition to, the design capacity megawatts ("MW") listed in the table above.
|
Facility
|
|
Equivalent Electric Output (MW)
|
Niagara
|
|
66
|
Indianapolis
|
|
52
|
Tulsa
|
|
25
|
Huntsville
|
|
15
|
Pittsfield
|
|
5
|
Lancaster
|
|
5
|
|
|
|
|
|
|
Design Capacity
|
|
|
||||
|
|
Project
|
|
Location
|
|
Waste
Processing
(Metric TPD)
|
|
Gross
Electric
(MW)
|
|
Nature of Interest
|
||
|
|
|||||||||||
1.
|
|
Dublin
(1) (2)
|
|
Ireland
|
|
1,800
|
|
|
58.0
|
|
|
50% Owner/Operator
|
2.
|
|
Trezzo
|
|
Italy
|
|
500
|
|
|
18.0
|
|
|
13% Owner/JV Operator
|
3.
|
|
Earls Gate
(1) (3)
|
|
UK
|
|
650
|
|
|
21.5
|
|
|
25% Owner
(3)
|
|
|
|
|
SUBTOTAL
|
|
2,950
|
|
|
97.5
|
|
|
|
(1)
|
For additional information see
Item 8. Financial Statements and Supplementary Data-
Note 3.
New Business and Asset Management
,-Green Investment Group Limited (“GIG”) Joint Ventures.
|
(2)
|
We have a
50%
indirect ownership of Dublin EfW, through our 50/50 joint venture with GIG, Covanta Europe Assets Ltd.
|
(3)
|
Facility currently under construction with operations expected to commence in late 2021. Covanta will provide technical oversight services during construction and operations. Waste secured under long-term agreements total 75% of capacity and 100% of electricity and steam output will be sold under a long-term agreement with industrial site host. The facility is designed to export steam at the equivalent electric output of 11 MW. The equivalent electric output is part of, not in addition to, the design capacity megawatts MW listed in the table above.
|
|
|
As of December 31,
|
||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||
Consumer Price Index
(1)
|
|
1.9
|
%
|
|
2.1
|
%
|
|
2.1
|
%
|
|
0.7
|
%
|
||||
PJM Pricing (Electricity)
(2)
|
|
$
|
34.75
|
|
|
$
|
28.84
|
|
|
$
|
24.85
|
|
|
$
|
36.00
|
|
NE ISO Pricing (Electricity)
(3)
|
|
$
|
44.06
|
|
|
$
|
33.27
|
|
|
$
|
29.74
|
|
|
$
|
42.93
|
|
Henry Hub Pricing (Natural Gas)
(4)
|
|
$
|
3.17
|
|
|
$
|
2.99
|
|
|
$
|
2.52
|
|
|
$
|
2.60
|
|
#1 HMS Pricing (Ferrous Metals)
(5)
|
|
$
|
328
|
|
|
$
|
268
|
|
|
$
|
197
|
|
|
$
|
217
|
|
Scrap Metals - Old Cast Aluminum Scrap
(6)
|
|
$
|
0.57
|
|
|
$
|
0.61
|
|
|
$
|
0.57
|
|
|
$
|
0.63
|
|
(1)
|
Represents the year-over-year percent change in the Headline CPI number. The Consumer Price Index (CPI-U) data is provided by the US Department of Labor Bureau of Labor Statistics.
|
(2)
|
Average price per MWh for full year. Pricing for the PJM PSEG Zone is provided by the PJM ISO.
|
(3)
|
Average price per MWh for full year. Pricing for the Mass Hub Zone is provided by the NE ISO.
|
(4)
|
Average price per MMBtu for full year. The Henry Hub Pricing data is provided by the Natural Gas Weekly Update, Energy Information Administration, Washington, DC.
|
(5)
|
Average price per gross ton for full year. The #1 Heavy Melt Steel ("HMS") composite index ($/gross ton) price is published by American Metal Market.
|
(6)
|
Average price per pound for full year. Calculated using the high price of Old Cast Aluminum Scrap ($/lb.) published by American Metal Market.
|
•
|
regional population and overall waste production rates;
|
•
|
the number of waste disposal sites (including principally landfills, other EfW facilities and transfer stations) in existence or in the planning or permitting process;
|
•
|
the available disposal capacity (in terms of tons of waste per day) that can be offered by other regional disposal sites;
|
•
|
the extent to which local governments seek to control transportation and/or disposal of waste within their jurisdictions;
|
•
|
the extent to which local governments and businesses continue to value sustainable approaches to handling of wastes; and
|
•
|
the availability and cost of transportation options (e.g., rail, inter-modal, trucking) to provide access to more distant disposal sites, thereby affecting the size of the waste market itself.
|
•
|
The Regional Greenhouse Gas Initiative (“RGGI”) is an operating regional “cap-and-trade” program focused on fossil fuel-fired electric generators which does not directly affect EfW facilities. We operate one fossil-fuel fired boiler at our Niagara facility included in the RGGI program.
|
•
|
California's Global Warming Solutions Act of 2006 ("AB 32"), seeks to reduce GHG emissions in California to 1990 levels by 2020, through an economy-wide “cap-and-trade” program. EfW facilities were exempt from the cap-and-trade program through the end of 2017. Resolutions passed by the Board of the California Air Resources Board (“CARB”) direct the agency to provide transition assistance to EfW facilities beginning in 2018. The specific degree of assistance to be provided is uncertain at this time.
|
Name and Title
|
Age
|
Experience
|
Stephen J. Jones President and Chief Executive Officer
|
57
|
President and Chief Executive Officer since 2015. Prior to joining Covanta, Mr. Jones was employed by Air Products and Chemicals, Inc. (“Air Products”), a global supplier of industrial gases, equipment and services from 1992 through 2014. Mr. Jones served as Senior Vice President and General Manager, Tonnage Gases, Equipment and Energy, from 2009 through 2014. Mr. Jones also served as Air Products’ China President from 2011 through 2014 at Air Products’ office in Shanghai. He was also a member of Air Products’ Corporate Executive Committee from 2007 through 2014. Mr. Jones joined Air Products in 1992 as an attorney in the Law Group representing various business areas and functions and in 2007 he was appointed Senior Vice President, General Counsel and Secretary.
|
Bradford J. Helgeson Executive Vice President and Chief Financial Officer
|
42
|
Executive Vice President and Chief Financial Officer since 2013. Mr. Helgeson served as Vice President and Treasurer from 2007 to 2013. Prior to joining Covanta in 2007, Mr. Helgeson was Vice President, Finance and Treasurer at Waste Services, Inc., a publicly-traded environmental services company with operations in the United States and Canada, from 2004 to 2007. Prior to these roles, Mr. Helgeson held positions in the investment banking departments at Lehman Brothers from 2000 to 2004 and at Donaldson, Lufkin & Jenrette from 1998 to 2000.
|
Michael J. de Castro Executive Vice President, Supply Chain
|
56
|
Executive Vice President, Supply Chain since 2015. Mr. de Castro was employed by Air Products from 2006 to 2010, serving in various operational capacities including Director, Global Operations Americas. Mr. de Castro was Chief Executive Officer of Interstate Waste Services ("IWS") from 2010 to 2013 when he returned to Air Products, serving as Director, Global Operations Strategic Development and as Fulfillment Director in the Performance Materials Division. Prior to his tenure at IWS and Air Products, Mr. de Castro held a variety of positions at American Ref-Fuel Company for 16 years, including of Vice President, Operations.
|
Derek W. Veenhof Executive Vice President, Asset Management
|
52
|
Executive Vice President since 2013. Mr. Veenhof served as Senior Vice President (2011-2013) and Vice President (2007-2010) of Covanta commercial subsidiaries managing contracting and market development efforts in waste and metals recycling. From 2002 to 2006, Mr. Veenhof was Covanta’s Area Manager responsible for the Metro NY, NJ and Philadelphia market areas. Mr. Veenhof joined Covanta in 1997, serving as the Niagara Facility Business Manager from 1997-2001.
|
Timothy J. Simpson Executive Vice President, General Counsel and Secretary
|
60
|
Executive Vice President, General Counsel and Secretary since 2007. Mr. Simpson served as Senior Vice President, General Counsel and Secretary from 2004 to 2007. Previously, he served as Senior Vice President, General Counsel and Secretary of Covanta Energy from March 2004 to October 2004. Mr. Simpson joined Covanta in 1992.
|
Matthew R. Mulcahy Executive Vice President and Head of Corporate Development
|
55
|
Executive Vice President and Head of Corporate Development since 2017. Mr. Mulcahy served as Senior Vice President and Head of Corporate Development for Covanta from 2012 to 2016 and Senior Vice President of Business Development from 2007 through 2011. From 2003 to 2007, Mr. Mulcahy served as Vice President of Covanta Secure Service and TransRiver Marketing, a Covanta subsidiary. From 2000 to 2003, Mr. Mulcahy was Covanta’s Vice President, Project Implementation. Mr. Mulcahy joined Covanta in 1990.
|
Paul E. Stauder Senior Vice President and President, Covanta Environmental Solutions
|
53
|
Senior Vice President since 2016 and President of Covanta Environmental Solutions, a subsidiary of Covanta Energy, since 2015. Mr. Stauder served as Senior Vice President of Business Management for Covanta Energy from 2008 to 2014, with primary responsibility for all commercial and client aspects of Covanta’s EFW facilities. Prior to that role, Mr. Stauder served in a number of positions with Covanta Energy, including Regional Vice President, overseeing EfW plants and independent power plants. Mr. Stauder joined Covanta in 1997.
|
Virginia D. Angilello Senior Vice President and Chief Human Resources Officer
|
49
|
Ms. Angilello was appointed Senior Vice President and Chief Human Resources Officer in 2018. Prior to joining Covanta, she worked for more than 17 years in roles of increasing responsibility at Honeywell International. Most recently, she served as Vice President, Human Resources for Performance Materials & Technologies (PMT), Integrated Supply Chain from 2015 to 2018. PMT was a $10 billion business within Honeywell, with more than 90 manufacturing facilities globally. Prior to this position she gained extensive experience in human resources leadership in both HR business partner and HR operations roles from 2007 - 2014, including having led the Honeywell HR Services, Global Operations teams.
|
Manpreet Grewal Vice President and Chief Accounting Officer
|
40
|
Vice President and Chief Accounting Officer since 2017. Prior to joining Covanta, he was the Senior Director, Global Financial & Operational Audits from 2016 through 2017 for Johnson Controls plc, a leading provider in building technologies and solutions and automotive batteries globally. Prior to this position, Mr. Grewal spent 13 years working in a variety of finance and accounting roles at Tyco International plc, prior to Tyco’s 2016 merger with Johnson Controls. From 2014 through 2015 Mr. Grewal was the Director, Internal Audit and from 2012 to 2013, he was the Sr. Manager, Accounting Research & Shared Processes for Tyco.
|
•
|
supply or transportation interruptions;
|
•
|
the breakdown, failure or unplanned maintenance or repair of equipment or processes;
|
•
|
difficulty or inability to find suitable replacement parts for equipment;
|
•
|
the unavailability of sufficient quantities of waste or fuel;
|
•
|
fluctuations in the heating value of the waste we use for fuel at our EfW facilities;
|
•
|
failure or inadequate performance by subcontractors;
|
•
|
disruption in the transmission of electricity generated;
|
•
|
labor disputes and work stoppages;
|
•
|
unforeseen engineering and environmental problems;
|
•
|
unanticipated cost overruns;
|
•
|
weather interferences and catastrophic events including fires, explosions, earthquakes, droughts, pandemics and acts of terrorism; and
|
•
|
the exercise of the power of eminent domain.
|
•
|
making it difficult for us to meet our payment and other obligations under our outstanding indebtedness;
|
•
|
limiting our ability to obtain additional financing to fund working capital, capital expenditures, new projects, acquisitions and other general corporate purposes;
|
•
|
subjecting us to the risk of increased sensitivity to interest rate increases on indebtedness under our credit facilities;
|
•
|
limiting our flexibility in planning for, or reacting to, and increasing our vulnerability to, changes in our business, the industries in which we operate and the general economy; and
|
•
|
placing us at a competitive disadvantage compared to our competitors that have less debt or are less leveraged.
|
•
|
the continued operation and maintenance of our facilities, consistent with historical performance levels;
|
•
|
maintenance or enhancement of revenue from renewals or replacement of existing contracts and from new contracts to expand existing facilities or operate additional facilities;
|
•
|
market conditions affecting waste disposal and energy pricing, as well as competition from other companies for contract renewals, expansions and additional contracts, particularly after our existing contracts expire;
|
•
|
the continued availability of the benefits of our net operating loss carryforwards; and
|
•
|
general economic, financial, competitive, legislative, regulatory and other factors.
|
•
|
difficulties in identifying, obtaining and permitting suitable sites for new projects;
|
•
|
the inaccuracy of our assumptions with respect to the cost of and schedule for completing construction;
|
•
|
difficulty, delays or inability to obtain financing for a project on acceptable terms;
|
•
|
delays in deliveries of, or increases in the prices of, equipment sourced from other countries;
|
•
|
the unavailability of sufficient quantities of waste or other fuels for startup;
|
•
|
permitting and other regulatory issues, license revocation and changes in legal requirements;
|
•
|
labor disputes and work stoppages;
|
•
|
unforeseen engineering and environmental problems;
|
•
|
interruption of existing operations;
|
•
|
unanticipated cost overruns or delays; and
|
•
|
weather interferences and catastrophic events including fires, explosions, earthquakes, droughts, pandemics and acts of terrorism.
|
•
|
support agreements in connection with construction, service or operating agreement-related obligations;
|
•
|
direct guarantees of certain debt relating to our facilities;
|
•
|
contingent obligations to pay lease payment installments in connection with certain of our facilities;
|
•
|
agreements to arrange financing for projects under development;
|
•
|
contingent credit support for damages arising from performance failures;
|
•
|
environmental indemnities; and
|
•
|
contingent capital and credit support to finance costs, in most cases in connection with a corresponding increase in service fees, relating to uncontrollable circumstances.
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||
Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating revenue
|
|
$
|
1,868
|
|
|
$
|
1,752
|
|
|
$
|
1,699
|
|
|
$
|
1,645
|
|
|
$
|
1,682
|
|
Operating expense
|
|
$
|
1,805
|
|
|
$
|
1,651
|
|
|
$
|
1,590
|
|
|
$
|
1,536
|
|
|
$
|
1,528
|
|
Operating income
|
|
$
|
63
|
|
|
$
|
101
|
|
|
$
|
109
|
|
|
$
|
109
|
|
|
$
|
154
|
|
Net income (loss)
(1)
|
|
$
|
152
|
|
|
$
|
57
|
|
|
$
|
(4
|
)
|
|
$
|
69
|
|
|
$
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings (loss) per share:
(1)
|
||||||||||||||||||||
Basic
|
|
$
|
1.17
|
|
|
$
|
0.44
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.52
|
|
|
$
|
(0.01
|
)
|
Diluted
|
|
$
|
1.15
|
|
|
$
|
0.44
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.51
|
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average common shares outstanding:
|
||||||||||||||||||||
Basic
|
|
130
|
|
|
130
|
|
|
129
|
|
|
132
|
|
|
130
|
|
|||||
Diluted
|
|
132
|
|
|
131
|
|
|
129
|
|
|
133
|
|
|
130
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash dividend declared per share
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
0.86
|
|
|
|
As of December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
58
|
|
|
$
|
46
|
|
|
$
|
84
|
|
|
$
|
94
|
|
|
$
|
84
|
|
Property, plant and equipment, net
|
|
$
|
2,514
|
|
|
$
|
2,606
|
|
|
$
|
3,024
|
|
|
$
|
2,690
|
|
|
$
|
2,607
|
|
Assets held for sale
|
|
$
|
2
|
|
|
$
|
653
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total assets
|
|
$
|
3,843
|
|
|
$
|
4,441
|
|
|
$
|
4,284
|
|
|
$
|
4,234
|
|
|
$
|
4,178
|
|
Long-term debt (incl. current portion)
|
|
$
|
2,342
|
|
|
$
|
2,349
|
|
|
$
|
2,252
|
|
|
$
|
2,263
|
|
|
$
|
1,948
|
|
Project debt (incl. current portion)
|
|
$
|
152
|
|
|
$
|
174
|
|
|
$
|
383
|
|
|
$
|
198
|
|
|
$
|
222
|
|
Liabilities held for sale
|
|
$
|
—
|
|
|
$
|
540
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total liabilities
|
|
$
|
3,356
|
|
|
$
|
4,014
|
|
|
$
|
3,815
|
|
|
$
|
3,594
|
|
|
$
|
3,394
|
|
Total stockholders' equity
|
|
$
|
487
|
|
|
$
|
427
|
|
|
$
|
469
|
|
|
$
|
638
|
|
|
$
|
782
|
|
•
|
“Organic growth”: reflects the performance of the business on a comparable period-over-period basis, excluding the impacts of transactions and contract transitions.
|
•
|
“Transactions”: includes the impacts of acquisitions, divestitures, and the addition or loss of operating contracts.
|
•
|
“Contract transitions”: includes the impact of the expiration of: (a) long-term major waste and service contracts, most typically representing the transition to a new contract structure, and (b) long-term energy contracts.
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2018
|
|
2017
|
|
Variance
Increase (Decrease) |
||||||
|
|
(In millions)
|
||||||||||
OPERATING REVENUE:
|
|
|
|
|
|
|
||||||
Waste and service revenue
|
|
$
|
1,327
|
|
|
$
|
1,231
|
|
|
$
|
96
|
|
Energy revenue
|
|
343
|
|
|
334
|
|
|
9
|
|
|||
Recycled metals revenue
|
|
95
|
|
|
82
|
|
|
13
|
|
|||
Other operating revenue
|
|
103
|
|
|
105
|
|
|
(2
|
)
|
|||
Total operating revenue
|
|
1,868
|
|
|
1,752
|
|
|
116
|
|
|||
OPERATING EXPENSE:
|
|
|
|
|
|
|
||||||
Plant operating expense
|
|
1,321
|
|
|
1,271
|
|
|
50
|
|
|||
Other operating expense
|
|
65
|
|
|
51
|
|
|
14
|
|
|||
General and administrative expense
|
|
115
|
|
|
112
|
|
|
3
|
|
|||
Depreciation and amortization expense
|
|
218
|
|
|
215
|
|
|
3
|
|
|||
Impairment charges
|
|
86
|
|
|
2
|
|
|
84
|
|
|||
Total operating expense
|
|
1,805
|
|
|
1,651
|
|
|
154
|
|
|||
Operating income
|
|
$
|
63
|
|
|
$
|
101
|
|
|
$
|
(38
|
)
|
In millions:
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2018
|
|
2017
|
|
Variance
|
||||||
EfW tip fees
|
|
$
|
624
|
|
|
$
|
572
|
|
|
$
|
52
|
|
EfW service fees
|
|
424
|
|
|
393
|
|
|
31
|
|
|||
Environmental services
|
|
141
|
|
|
129
|
|
|
12
|
|
|||
Municipal services
(1)
|
|
207
|
|
|
194
|
|
|
13
|
|
|||
Other
|
|
38
|
|
|
42
|
|
|
(4
|
)
|
|||
Intercompany
|
|
(107
|
)
|
|
(99
|
)
|
|
(8
|
)
|
|||
Total waste and service revenue
|
|
$
|
1,327
|
|
|
$
|
1,231
|
|
|
$
|
96
|
|
In millions:
(1)
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2018
|
|
2017
|
|
Variance
|
||||||
Energy sales
|
|
$
|
291
|
|
|
$
|
288
|
|
|
$
|
3
|
|
Capacity
|
|
52
|
|
|
46
|
|
|
6
|
|
|||
Total energy
|
|
$
|
343
|
|
|
$
|
334
|
|
|
$
|
9
|
|
|
|
Year Ended December 31,
|
|
|
|
|
|||||||||||||||||||||
Total EfW (in millions):
|
|
2018
|
|
2017
|
|
Variance
|
|||||||||||||||||||||
|
|
Revenue
(1)
|
|
Volume
(1), (2)
|
|
% of Total Volume
|
|
Revenue
(1)
|
|
Volume
(1), (2)
|
|
% of Total Volume
|
|
Revenue
|
|
Volume
|
|||||||||||
At Market
|
|
$
|
49
|
|
|
1.3
|
|
|
20
|
%
|
|
$
|
23
|
|
|
0.8
|
|
|
13
|
%
|
|
$
|
26
|
|
|
0.5
|
|
Contracted
|
|
192
|
|
|
2.1
|
|
|
33
|
%
|
|
216
|
|
|
2.5
|
|
|
41
|
%
|
|
(24
|
)
|
|
(0.4
|
)
|
|||
Hedged
|
|
101
|
|
|
3.1
|
|
|
47
|
%
|
|
95
|
|
|
2.7
|
|
|
46
|
%
|
|
6
|
|
|
0.4
|
|
|||
Total EfW
|
|
$
|
342
|
|
|
6.5
|
|
|
100
|
%
|
|
$
|
334
|
|
|
6.0
|
|
|
100
|
%
|
|
$
|
8
|
|
|
0.5
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
Metal Revenue
(in millions)
|
|
Tons Sold
(in thousands) (1) |
|
Tons Recovered
(in thousands) |
||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Ferrous Metal
|
$
|
58
|
|
|
$
|
48
|
|
|
333
|
|
|
302
|
|
|
424
|
|
|
396
|
|
Non-Ferrous Metal
|
37
|
|
|
34
|
|
|
31
|
|
|
31
|
|
|
49
|
|
|
38
|
|
||
Total
|
$
|
95
|
|
|
$
|
82
|
|
|
|
|
|
|
|
|
|
Consolidated (in millions):
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2018
|
|
2017
|
|
Variance
|
||||||
Plant maintenance
(1)
|
|
$
|
299
|
|
|
$
|
311
|
|
|
$
|
(12
|
)
|
All other
|
|
1,023
|
|
|
960
|
|
|
63
|
|
|||
Plant operating expense
|
|
$
|
1,321
|
|
|
$
|
1,271
|
|
|
$
|
50
|
|
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2017
|
|
2016
|
|
Variance
Increase (Decrease) |
||||||
|
|
(In millions)
|
||||||||||
OPERATING REVENUE:
|
|
|
|
|
|
|
||||||
Waste and service revenue
|
|
$
|
1,231
|
|
|
$
|
1,187
|
|
|
$
|
44
|
|
Energy revenue
|
|
334
|
|
|
370
|
|
|
(36
|
)
|
|||
Recycled metals revenue
|
|
82
|
|
|
61
|
|
|
21
|
|
|||
Other operating revenue
|
|
105
|
|
|
81
|
|
|
24
|
|
|||
Total operating revenue
|
|
1,752
|
|
|
1,699
|
|
|
53
|
|
|||
OPERATING EXPENSE:
|
|
|
|
|
|
|
||||||
Plant operating expense
|
|
1,271
|
|
|
1,177
|
|
|
94
|
|
|||
Other operating expense
|
|
51
|
|
|
86
|
|
|
(35
|
)
|
|||
General and administrative expense
|
|
112
|
|
|
100
|
|
|
12
|
|
|||
Depreciation and amortization expense
|
|
215
|
|
|
207
|
|
|
8
|
|
|||
Impairment charges
|
|
2
|
|
|
20
|
|
|
(18
|
)
|
|||
Total operating expense
|
|
1,651
|
|
|
1,590
|
|
|
61
|
|
|||
Operating income
|
|
$
|
101
|
|
|
$
|
109
|
|
|
$
|
(8
|
)
|
In millions:
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2017
|
|
2016
|
|
Variance
|
||||||
EfW tip fees
|
|
$
|
572
|
|
|
$
|
551
|
|
|
$
|
21
|
|
EfW service fees
|
|
393
|
|
|
406
|
|
|
(13
|
)
|
|||
Environmental services
|
|
129
|
|
|
104
|
|
|
25
|
|
|||
Municipal services
(1)
|
|
194
|
|
|
186
|
|
|
8
|
|
|||
Other
|
|
42
|
|
|
36
|
|
|
6
|
|
|||
Intercompany
|
|
(99
|
)
|
|
(96
|
)
|
|
(3
|
)
|
|||
Total waste and service revenue
|
|
$
|
1,231
|
|
|
$
|
1,187
|
|
|
$
|
44
|
|
In millions:
(1)
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2017
|
|
2016
|
|
Variance
|
||||||
Energy sales
|
|
$
|
288
|
|
|
$
|
321
|
|
|
$
|
(33
|
)
|
Capacity
|
|
46
|
|
|
40
|
|
|
6
|
|
|||
Other revenue
|
|
—
|
|
|
9
|
|
|
(9
|
)
|
|||
Total energy
|
|
$
|
334
|
|
|
$
|
370
|
|
|
$
|
(36
|
)
|
|
|
Year Ended December 31,
|
|
|
|
|
|||||||||||||||||||||
|
|
2017
|
|
2016
|
|
Variance
|
|||||||||||||||||||||
Total EfW (in millions):
|
|
Revenue
(1)
|
|
Volume
(1), (2)
|
|
% of Total Volume
|
|
Revenue
(1)
|
|
Volume
(1), (2)
|
|
% of Total Volume
|
|
Revenue
|
|
Volume
|
|||||||||||
At Market
|
|
$
|
23
|
|
|
0.8
|
|
|
13
|
%
|
|
$
|
33
|
|
|
1.0
|
|
|
17
|
%
|
|
$
|
(10
|
)
|
|
(0.2
|
)
|
Contracted
|
|
216
|
|
|
2.5
|
|
|
41
|
%
|
|
245
|
|
|
3.1
|
|
|
51
|
%
|
|
(29
|
)
|
|
(0.6
|
)
|
|||
Hedged
|
|
95
|
|
|
2.7
|
|
|
46
|
%
|
|
83
|
|
|
1.9
|
|
|
32
|
%
|
|
12
|
|
|
0.8
|
|
|||
Total EfW
|
|
$
|
334
|
|
|
6.0
|
|
|
100
|
%
|
|
$
|
361
|
|
|
6.0
|
|
|
100
|
%
|
|
$
|
(27
|
)
|
|
—
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
Metal Revenue
(in millions)
|
|
Tons Sold
(in thousands) (1) |
|
Tons Recovered
(in thousands) |
||||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Ferrous Metal
|
$
|
48
|
|
|
$
|
38
|
|
|
302
|
|
|
345
|
|
|
396
|
|
|
401
|
|
Non-Ferrous Metal
|
34
|
|
|
23
|
|
|
31
|
|
|
36
|
|
|
38
|
|
|
36
|
|
||
Total
|
$
|
82
|
|
|
$
|
61
|
|
|
|
|
|
|
|
|
|
In millions:
|
|
Year Ended December 31,
|
|
|
||||||||
|
|
2017
|
|
2016
|
|
Variance
|
||||||
Plant maintenance
(1)
|
|
$
|
311
|
|
|
$
|
279
|
|
|
$
|
32
|
|
All other
|
|
960
|
|
|
898
|
|
|
62
|
|
|||
Plant operating expense
|
|
$
|
1,271
|
|
|
$
|
1,177
|
|
|
$
|
94
|
|
|
|
Year Ended December 31,
|
|
Variance
Increase (Decrease)
|
||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Interest expense
|
|
$
|
(145
|
)
|
|
$
|
(147
|
)
|
|
$
|
(138
|
)
|
|
$
|
2
|
|
|
$
|
(9
|
)
|
Gain (loss) on sale of business
|
|
217
|
|
|
(6
|
)
|
|
44
|
|
|
223
|
|
|
(50
|
)
|
|||||
Loss on extinguishment of debt
|
|
(15
|
)
|
|
(84
|
)
|
|
—
|
|
|
69
|
|
|
(84
|
)
|
|||||
Other (expense) income, net
|
|
(3
|
)
|
|
1
|
|
|
(1
|
)
|
|
(4
|
)
|
|
2
|
|
|||||
Total other income (expense)
|
|
$
|
54
|
|
|
$
|
(236
|
)
|
|
$
|
(95
|
)
|
|
$
|
290
|
|
|
$
|
(141
|
)
|
|
|
Year Ended December 31,
|
|
Variance
Increase (Decrease)
|
||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
(In millions, except percentages)
|
||||||||||||||||||
Income tax (benefit) expense
|
|
$
|
(29
|
)
|
|
$
|
(191
|
)
|
|
$
|
22
|
|
|
$
|
162
|
|
|
$
|
(213
|
)
|
Effective income tax rate
|
|
(25
|
)%
|
|
142
|
%
|
|
150
|
%
|
|
|
|
|
|
|
Year Ended December 31,
|
|
Variance
Increase (Decrease)
|
||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2018 vs 2017
|
|
2017 vs 2016
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||
Net Income (Loss)
|
|
$
|
152
|
|
|
$
|
57
|
|
|
$
|
(4
|
)
|
|
$
|
95
|
|
|
$
|
61
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings (Loss) Per Share:
|
||||||||||||||||||||
Weighted Average Shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic:
|
|
130
|
|
|
130
|
|
|
129
|
|
|
—
|
|
|
1
|
|
|||||
Diluted:
|
|
132
|
|
|
131
|
|
|
129
|
|
|
1
|
|
|
2
|
|
|||||
Earnings (Loss) Per Share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic:
|
|
$
|
1.17
|
|
|
$
|
0.44
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.73
|
|
|
$
|
0.47
|
|
Diluted:
|
|
$
|
1.15
|
|
|
$
|
0.44
|
|
|
$
|
(0.03
|
)
|
|
$
|
0.71
|
|
|
$
|
0.47
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash Dividend Declared Per Share
(1)
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Year Ended December 31,
|
||||||||||
Adjusted EBITDA
|
|
2018
|
|
2017
|
|
2016
|
||||||
Net income (loss)
(a)
|
|
$
|
152
|
|
|
$
|
57
|
|
|
$
|
(4
|
)
|
Depreciation and amortization expense
|
|
218
|
|
|
215
|
|
|
207
|
|
|||
Interest expense
|
|
145
|
|
|
147
|
|
|
138
|
|
|||
Income tax (benefit) expense
(a)
|
|
(29
|
)
|
|
(191
|
)
|
|
22
|
|
|||
Impairment charges
(b)
|
|
86
|
|
|
2
|
|
|
20
|
|
|||
(Gain) loss on sale of business
(c)
|
|
(217
|
)
|
|
6
|
|
|
(44
|
)
|
|||
Loss on extinguishment of debt
(d)
|
|
15
|
|
|
84
|
|
|
—
|
|
|||
Property insurance recoveries, net
(e)
|
|
(18
|
)
|
|
(2
|
)
|
|
—
|
|
|||
Capital type expenditures at client owned facilities
(f)
|
|
37
|
|
|
55
|
|
|
39
|
|
|||
Debt service billings (less than) in excess of revenue recognized
|
|
(1
|
)
|
|
5
|
|
|
4
|
|
|||
Business development and transaction costs
|
|
3
|
|
|
5
|
|
|
2
|
|
|||
Severance and reorganization costs
|
|
5
|
|
|
1
|
|
|
3
|
|
|||
Non-cash compensation expense
|
|
24
|
|
|
18
|
|
|
16
|
|
|||
Adjustments to reflect Adjusted EBITDA from unconsolidated investments
|
|
23
|
|
|
—
|
|
|
—
|
|
|||
Other
(g)
|
|
14
|
|
|
6
|
|
|
7
|
|
|||
Adjusted EBITDA
|
|
$
|
457
|
|
|
$
|
408
|
|
|
$
|
410
|
|
(a)
|
The year ended December 31, 2017 includes a provisional net tax benefit of
$183 million
(
$1.40
per diluted share) associated with the enactment of the Tax Cuts and Jobs Act of 2017.
For additional information, see Item 8. Financial Statements And Supplementary Data
—
Note 11. Income Taxes
.
|
(b)
|
During the
year
ended
December 31, 2018
, we identified indicators of impairment associated with certain of our EfW facilities and recorded a non-cash impairment charge of
$86 million
to reduce the carrying value of the facilities to their estimated fair value.
|
(c)
|
During the year ended
December 31, 2018
, we recorded a $7 million gain on the sale of our equity interests in Koma Kulshan, a $204 million gain on the sale of 50% of our Dublin EfW facility to our joint venture with the Green Investment Group Limited and a $6 million gain on the sale of our remaining interests in China.
|
(d)
|
During the
year
ended
December 31, 2018
, we recorded a $3 million loss related to the refinancing of our tax-exempt bonds and a $12 million loss related to the redemption of our redemption of our 2022 Senior Notes.
S
ee Item 8. Financial Statements And Supplementary Data
—
Note 16. Consolidated Debt
.
|
(e)
|
During the year ended December 31, 2018 we recorded a $18 million property insurance gain related to our property insurance recoveries at Fairfax.
S
ee Item 8. Financial Statements And Supplementary Data
—
Note 10. Supplementary Information
.
|
(f)
|
Adjustment for impact of adoption of FASB ASC 853 -
Service Concession Arrangements.
These types of capital equipment related expenditures at our service fee operated facilities were historically capitalized prior to adoption of this new accounting standard effective January 1, 2015 and are capitalized at facilities that we own.
|
(g)
|
Includes certain other items that are added back under the definition of Adjusted EBITDA in Covanta Energy, LLC's credit agreement.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flow provided by operating activities
|
|
$
|
238
|
|
|
$
|
242
|
|
|
$
|
264
|
|
Cash paid for interest, net of capitalized interest
|
|
136
|
|
|
132
|
|
|
135
|
|
|||
Cash paid for taxes
|
|
2
|
|
|
—
|
|
|
(6
|
)
|
|||
Capital type expenditures at service fee operated facilities
(a)
|
|
37
|
|
|
55
|
|
|
39
|
|
|||
Equity in net income from unconsolidated investments
|
|
6
|
|
|
1
|
|
|
4
|
|
|||
Dividends from unconsolidated investments
|
|
(13
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|||
Adjustment for working capital and other
|
|
28
|
|
|
(20
|
)
|
|
(24
|
)
|
|||
Adjusted EBITDA
|
|
$
|
457
|
|
|
$
|
408
|
|
|
$
|
410
|
|
(a)
|
See
Adjusted EBITDA - Note (f)
above.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Diluted earnings (loss) per share
|
|
$
|
1.15
|
|
|
$
|
0.44
|
|
|
$
|
(0.03
|
)
|
Reconciling items
(1)
|
|
(1.25
|
)
|
|
(0.81
|
)
|
|
(0.03
|
)
|
|||
Adjusted EPS
|
|
$
|
(0.10
|
)
|
|
$
|
(0.37
|
)
|
|
$
|
(0.06
|
)
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Reconciling Items
|
|
|
|
|
|
|
||||||
Impairment charges
(a)
|
|
86
|
|
|
2
|
|
|
20
|
|
|||
(Gain) loss on sale of business
(a)
|
|
(217
|
)
|
|
6
|
|
|
(44
|
)
|
|||
Property insurance recoveries, net
|
|
(18
|
)
|
|
(2
|
)
|
|
—
|
|
|||
Severance and reorganization costs
|
|
5
|
|
|
1
|
|
|
2
|
|
|||
Loss on extinguishment of debt
(a)
|
|
15
|
|
|
84
|
|
|
—
|
|
|||
Effect on income of derivative instruments not designated as hedging instruments
|
|
—
|
|
|
—
|
|
|
2
|
|
|||
Effect of foreign exchange loss on indebtedness
|
|
3
|
|
|
(2
|
)
|
|
(1
|
)
|
|||
Other
|
|
(1
|
)
|
|
1
|
|
|
—
|
|
|||
Total Reconciling Items, pre-tax
|
|
(127
|
)
|
|
90
|
|
|
(21
|
)
|
|||
Pro forma income tax impact
(b)
|
|
(19
|
)
|
|
(4
|
)
|
|
2
|
|
|||
Adjustment to uncertain tax positions
|
|
—
|
|
|
—
|
|
|
14
|
|
|||
Grantor trust activity
|
|
—
|
|
|
(9
|
)
|
|
1
|
|
|||
Impact of New Jersey state tax law change
|
|
(19
|
)
|
|
—
|
|
|
—
|
|
|||
Impact of federal tax reform rate change
(a)
|
|
—
|
|
|
(204
|
)
|
|
—
|
|
|||
Transition tax
(a)
|
|
—
|
|
|
21
|
|
|
—
|
|
|||
Total reconciling Items, net of tax
|
|
$
|
(165
|
)
|
|
$
|
(106
|
)
|
|
$
|
(4
|
)
|
Diluted per share impact
|
|
$
|
(1.25
|
)
|
|
$
|
(0.81
|
)
|
|
$
|
(0.03
|
)
|
Weighted average diluted shares outstanding
|
|
132
|
|
|
131
|
|
|
129
|
|
(a)
|
For additional information, see
Adjusted EBITDA
above.
|
(b)
|
We calculate the federal and state tax impact of each item using the statutory federal tax rate and applicable blended state rate.
|
•
|
A full year contribution from the acquisition of the Palm Beach operating contracts;
|
•
|
The expected start up of the Manhattan marine transfer station; and
|
•
|
Improving waste tip fee prices and increased volumes of profiled waste.
|
•
|
The impact of lower energy capacity payments; and
|
•
|
Higher other operating expenses due to the receipt in 2018 of insurance proceeds (recorded as a contra-expense) relating to the 2017 fire in the front end receiving portion of the Fairfax County energy from waste facility.
|
|
|
As of December 31, 2018
|
||
Cash
|
|
$
|
58
|
|
Unutilized capacity under the Revolving Credit Facility
|
|
449
|
|
|
Total cash and unutilized capacity under the Revolving Credit Facility
|
|
$
|
507
|
|
•
|
In October 2018, we sold
$400 million
aggregate principal amount of Senior Notes due 2027. We used the net proceeds along with cash on hand and direct borrowings under our Revolving Credit Facility to fund the optional redemption of all of our Senior Notes due 2022 on November 5, 2018. For additional information see
Item 8. Financial Statements And Supplementary Data —
Note 16. Consolidated Debt
- Tax-Exempt Bond Refinancing.
|
•
|
In September 2018, we issued
$335 million
new tax exempt bonds to refinance outstanding tax exempt bonds of the same amounts and maturities related to our facilities in New York and Massachusetts. The new bonds are unsecured obligations of Covanta Holding Corporation and are not guaranteed by any of our subsidiaries, whereas the previous bonds were guaranteed by our subsidiary, Covanta Energy LLC. The transaction lowered the weighted average coupon on the bonds
|
•
|
In August 2018, we amended and restated Covanta Energy's Credit Facilities. For additional information see
Item 1. Financial Statements -
Note 16. Consolidated Debt
-
Credit Facility Refinancing.
|
•
|
In June 2018, we issued 5.00% tax-exempt corporate bonds totaling $30 million. Net proceeds from the offerings were used to finance certain capital expenditures at our Virginia facilities. For additional information see
Item 1. Financial Statements -
Note 16. Consolidated Debt
- Virginia Tax-Exempt Bonds.
|
•
|
In February 2018, we applied a portion of the net proceeds from the sale of 50% of our Dublin EfW facility to repay borrowings under the Revolving Credit Facility. For additional information see
Item 1. Financial Statements -
Note 3. New Business and Asset Management
- Green Investment Group Limited (“GIG”) Joint Venture.
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
|
||||||
Net cash provided by operating activities
|
|
$
|
238
|
|
|
$
|
242
|
|
|
$
|
264
|
|
Add: Changes in restricted funds - operating
(a)
|
|
4
|
|
|
1
|
|
|
22
|
|
|||
Less: Maintenance capital expenditures
(b)
|
|
(142
|
)
|
|
(111
|
)
|
|
(110
|
)
|
|||
Free Cash Flow
|
|
$
|
100
|
|
|
$
|
132
|
|
|
$
|
176
|
|
(a)
|
Adjustment for the impact of the adoption of ASU 2016-18 effective January 1, 2018. As a result of adoption, the statement of cash flows explains the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, changes in restricted funds are eliminated in arriving at net cash, cash equivalents and restricted funds provided by operating activities.
|
(b)
|
Purchases of property, plant and equipment are also referred to as capital expenditures. Capital expenditures that primarily maintain existing facilities are classified as maintenance capital expenditures.
|
|
As of December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(in millions)
|
||||||
Domestic
|
$
|
19
|
|
|
$
|
11
|
|
International
|
39
|
|
|
35
|
|
||
Total Cash and Cash Equivalents
|
$
|
58
|
|
|
$
|
46
|
|
|
|
As of December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Corporate Debt:
|
|
|
||||||
Revolving credit facility
|
|
$
|
212
|
|
|
$
|
445
|
|
Term loan due 2019
|
|
—
|
|
|
191
|
|
||
Term loan due 2023
|
|
395
|
|
|
—
|
|
||
Senior notes
|
|
1,200
|
|
|
1,200
|
|
||
Tax-exempt bonds
|
|
494
|
|
|
464
|
|
||
Equipment financing capital leases
|
|
64
|
|
|
69
|
|
||
Total corporate debt (including current portion)
|
|
$
|
2,365
|
|
|
$
|
2,369
|
|
|
|
|
|
|
||||
Project Debt:
|
|
|
|
|
||||
Domestic project debt - service fee facilities
|
|
$
|
58
|
|
|
$
|
68
|
|
Domestic project debt - tip fee facilities
|
|
3
|
|
|
9
|
|
||
Union County EfW facility capital lease
|
|
89
|
|
|
94
|
|
||
Total project debt (including current portion)
|
|
150
|
|
|
171
|
|
||
Total Debt Outstanding
|
|
$
|
2,515
|
|
|
$
|
2,540
|
|
(In millions)
|
|
Total
|
|
Payments Due by Period
|
||||||||||||||||
2019
|
|
2020 and
2021
|
|
2022 and
2023
|
|
2024 and
Beyond
|
||||||||||||||
RECORDED LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Project debt
(1)
|
|
$
|
150
|
|
|
$
|
19
|
|
|
$
|
16
|
|
|
$
|
18
|
|
|
$
|
97
|
|
Long-term debt
(1)
|
|
2,301
|
|
|
10
|
|
|
20
|
|
|
577
|
|
|
1,694
|
|
|||||
Equipment financing capital leases
(1)
|
|
64
|
|
|
5
|
|
|
12
|
|
|
12
|
|
|
35
|
|
|||||
Uncertainty in income tax obligations
(2)
|
|
41
|
|
|
6
|
|
|
3
|
|
|
1
|
|
|
31
|
|
|||||
Interest payments
|
|
1,385
|
|
|
145
|
|
|
282
|
|
|
262
|
|
|
696
|
|
|||||
Purchase obligations
(3)
|
|
22
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating leases
|
|
78
|
|
|
11
|
|
|
17
|
|
|
14
|
|
|
36
|
|
|||||
Retirement plan obligations
(4)
|
|
2
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||
Total obligations
|
|
$
|
4,043
|
|
|
$
|
218
|
|
|
$
|
350
|
|
|
$
|
885
|
|
|
$
|
2,590
|
|
(1)
|
For a detailed description of the terms of the debt instruments , see
Item 8. Financial Statements And Supplementary Data
—
Note 16. Consolidated Debt
.
|
(2)
|
Accounting for uncertainty in income tax obligations is based upon the expected date of settlement taking into account all of our administrative rights including possible litigation.
|
(3)
|
Purchase obligations relate to capital commitments related to our New York City waste transport and disposal contract. See
Item 8. Financial Statements And Supplementary Data —
Note 17. Commitments and Contingencies
for additional information
.
|
(4)
|
Retirement plan obligations are based on actuarial estimates for our non-qualified pension plan obligations and post-retirement plan obligations only as of
December 31, 2018
.
|
Letters of credit issued under the Revolving Credit Facility
|
|
$
|
239
|
|
Surety bonds
|
|
180
|
|
|
Total other commitments — net
|
|
$
|
419
|
|
|
|
Total Project Debt
|
|
Percentage Ownership
|
|
Proportionate Unconsolidated Project Debt
|
|
Project Stage
|
||||
Dublin EfW (Ireland)
(1)
|
|
$
|
475
|
|
|
50%
|
|
$
|
238
|
|
|
Operational
|
Earls Gate (UK)
(2) (3)
|
|
—
|
|
|
25%
|
|
—
|
|
|
Under construction
|
||
Total
|
|
$
|
475
|
|
|
|
|
$
|
238
|
|
|
|
(1)
|
We have a
50%
indirect ownership of Dublin EfW, through our 50/50 joint venture with GIG, Covanta Europe Assets Ltd.
|
(2)
|
We have a
25%
indirect ownership of Earls Gate, through our 50/50 joint venture with GIG, Covanta Green Jersey Assets Ltd., which owns
50%
of Earls Gate.
|
(3)
|
The total estimated project cost is £210 million ($267 million), £147 million ($187 million) is financed through non-recourse project-based debt, which was undrawn upon as of December 31, 2018.
|
Policy
|
|
Judgments and estimates
|
|
Effect if actual results differ
from assumptions
|
Revenue and Expense Recognition
The Company recognizes revenue in accordance with the ASC 606, Revenue from Contracts with Customers. The core principle of ASC 606 is that an entity will recognize revenue at an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to a customer.
Revenue is recognized by applying the five steps described below:
Step 1: Identify the contract(s) with a customer.
Step 2: Identify the performance obligations in the contract.
Step 3: Determine the transaction price.
Step 4: Allocate the transaction price to the performance obligation in the contract.
Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.
Covanta adopted the accounting standard on January 1, 2018.
|
|
When a performance obligation is satisfied over time, the output or input method may be used to determine an appropriate method of progress. The Output method recognize revenue on the basis of direct measurements of the value to the customer of the goods or services transferred to date relative to the remaining goods or services promised under the contract. The input method utilizes the entities inputs towards the satisfaction of a performance obligation (for example, costs incurred). Both methods may include estimates within the transaction price, contracts with customers may contain different types of variable consideration that we estimate through probability based approaches. There are certain constraining factors relating to Variable consideration that may preclude us from booking revenue in order to prevent over estimating revenue. Determining whether a factor is constrained requires judgment.
|
|
There is a degree of uncertainty that exists in determining the variable component of consideration in a contract. A significant revenue reversal is not expected but amounts recognized for revenue are adjusted based on actual performance obligations delivered which will cause fluctuations in operating income recognized.
Further estimates may change on long term construction contracts based on better information becoming available which can cause fluctuations in revenue and operating income.
|
Purchase Accounting
We allocate acquisition purchase prices to identified tangible and intangible assets acquired and liabilities assumed based on their estimated fair values at the dates of acquisition, with any residual amounts allocated to goodwill. The fair value estimates used reflect our best estimates for the highest and best use by market participants.
|
|
These estimates are subject to uncertainties and contingencies. For example, we use the discounted cash flow method to estimate the value of many of our assets, which entails developing projections of future cash flows.
|
|
If the cash flows from the acquired net assets differ significantly from our estimates, the amounts recorded could be subject to impairments.
Furthermore, to the extent we change our initial estimates of the remaining useful life of the assets or liabilities, future depreciation and amortization expense could be impacted.
|
|
|
|
|
|
Policy
|
|
Judgments and estimates
|
|
Effect if actual results differ
from assumptions
|
Equity Method Investments
We evaluate our equity investments to determine if we have the ability to exercise significant influence over the entity but not control, generally assumed to be 20%-50% ownership. Under the equity method, original investments are recorded at cost and adjusted by our share of earnings or losses of these companies. Distributions received from the investee reduce our carrying value of the investment and are recorded in the consolidated statements of cash flows using the cumulative earnings approach.
|
|
The determination and degree of our ability to control, or exert significant influence over, an entity involves the use of judgment. The consolidation guidance requires qualitative and quantitative analysis to determine whether our involvement, through holding interests directly or indirectly in an entity, would give us the ability to exercise significant influence over an entity but not control.
|
|
Subsequent changes to the interests of the entity through equity ownership levels or otherwise may require a reassessment of our conclusions of whether we have the ability to exercise significant influence over the entity but not control. If upon a reassessment event we were determined to control the entities, consolidation would be required. Summarized financial information of equity method investments is included in
Item 8. Financial Statements And Supplementary Data — Note 13. Equity Method Investments.
|
Long-lived Assets
Our long-lived assets include property, plant and equipment; waste, service and energy contracts; amortizable intangible assets; and other assets. We evaluate the recoverability of the long-lived assets when there are indicators of possible impairment. Such indicators may include a decline in market, new regulation, recurring or expected operating losses, change in business strategy, or other changes that would impact the use or benefit received from the assets. The assessment is performed by grouping the long-lived assets at the lowest level of identifiable cash flows for the related assets or group of assets (such as the facility level). Initially the carrying value of the asset or asset group is compared to its undiscounted expected future cash flows. If the carrying value is in excess of the undiscounted cash flows, the carrying value is then compared to the fair value. Fair value may be estimated based upon the discounted cash flows, market or replacement cost methods based on the assumptions of a third-party market participant. Impairment is recognized if the fair value is less than the carrying value.
|
|
Our judgments regarding the existence of impairment indicators are based on regulatory factors, market conditions, anticipated cash flows and operational performance of our assets.
When determining the fair value of our asset groupings for impairment assessments, we make assumptions regarding their fair values which are dependent on estimates of future cash flows, discount rates, and other factors. |
|
Future events or changes in circumstances may occur that require another assessment in future periods based on cash flows and discount rates in effect at that time.
|
|
|
|
|
|
Policy
|
|
Judgments and estimates
|
|
Effect if actual results differ
from assumptions |
Goodwill
As of December 31, 2018, we had $321 million of goodwill recorded in our one reportable segment, which is comprised of two reporting units (see
Item 8. Financial Statements And Supplementary Data — Note 15. Intangible Assets and Goodwill)
. We evaluate our goodwill annually and when an event occurs or circumstances change that could reduce the fair value of a reporting unit below its carrying value. We have the option to perform our initial assessment over the possible impairment of goodwill either qualitatively or quantitatively. Under the qualitative assessment, consideration is given to both external factors (including macroeconomic and industry conditions) and our own internal factors (including internal costs, recent financial performance, management, business strategy, customers, and stock price). During the fourth quarter of 2018 we performed the required annual impairment review of our recorded goodwill through a quantitative assessment and determined that there was no indication of impairment as the fair value of our reporting units exceeded their carrying values.
|
|
Our judgments regarding the existence of impairment indicators are based on regulatory factors, market conditions, anticipated cash flows and operational performance of our assets.
When determining the fair value of our reporting unit for impairment assessments, we make assumptions regarding the fair value which is dependent on estimates of future cash flows, discount rates, and other factors.
|
|
The impairment assessment of goodwill performed in the periods presented resulted in the conclusion that the fair value was not less than the carrying value.
In future years, if there is a significant change in the estimated cash flows, discount rates or other factors that cause the fair values to significantly decrease, there could be impairments which could materially impact our results of operations.
|
I
nsurance Reserves and Self-Insurance for Employee Benefit Plans
We retain a substantial portion of the risk related to certain general liability, workers’ compensation and medical claims. However, we maintain stop-loss coverage to limit the exposure related to employee benefit plans and liability insurance over retained risks. Liabilities associated with these losses include estimates of both claims filed and losses incurred but not yet reported ("IBNR").
|
|
We use actuarial methods which consider a number of factors to estimate our ultimate cost of losses. Our insurance reserves and medical liability accrual was $16 million as of December 31, 2018 and 2017.
|
|
Our liabilities could be significantly affected if future occurrences or loss developments differ from our estimates of both claims filed and losses incurred but not yet reported.
|
Policy
|
|
Judgments and estimates
|
|
Effect if actual results differ
from assumptions
|
Deferred Tax Assets
As described in
Item 8. Financial Statements And Supplementary Data — Note 11. Income Taxes
, we have recorded a deferred tax asset related to our NOLs.
The NOLs will expire in various amounts beginning on December 31, 2033 through December 31, 2037, if not used.
Deferred tax assets are reduced by a valuation allowance if, based on available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized.
|
|
We estimated a valuation allowance of approximately $73 million to offset our deferred tax assets related to NOLs and our tax credit carryforward balance.
The amount was estimated based upon future taxable income arising from (a) the reversal of temporary differences during the period the NOLs are available and (b) future operating income expected, to the extent it is reasonably predictable.
Judgment is involved in assessing whether a valuation allowance is required on our deferred tax assets.
|
|
The Tax Cuts and Jobs Act (“the Act”) was enacted on December 22, 2017. The Act reduces the US federal corporate tax rate from 35% to 21%, requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. As of December 31, 2018, we have completed our accounting for the tax effects of enactment of the Act.
We re-measured our US deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%. As of December 31, 2017, the provisional amount recorded related to the re-measurement of our deferred tax balance was $204 million of tax benefit. This amount is materially correct and there was no adjustment required in the year ended December 31, 2018. As of December 31, 2017, the provisional amount recorded for the transition tax was $21 million of tax liability. During the year ended December 31, 2018 we recorded a $1 million additional tax expense related to the transition tax. |
|
|
|
Page
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In millions, except per share amounts)
|
||||||||||
OPERATING REVENUE:
|
|
|
|
|
|
|
||||||
Waste and service revenue
|
|
$
|
1,327
|
|
|
$
|
1,231
|
|
|
$
|
1,187
|
|
Energy revenue
|
|
343
|
|
|
334
|
|
|
370
|
|
|||
Recycled metals revenue
|
|
95
|
|
|
82
|
|
|
61
|
|
|||
Other operating revenue
|
|
103
|
|
|
105
|
|
|
81
|
|
|||
Total operating revenue
|
|
1,868
|
|
|
1,752
|
|
|
1,699
|
|
|||
OPERATING EXPENSE:
|
|
|
|
|
|
|
||||||
Plant operating expense
|
|
1,321
|
|
|
1,271
|
|
|
1,177
|
|
|||
Other operating expense, net
|
|
65
|
|
|
51
|
|
|
86
|
|
|||
General and administrative expense
|
|
115
|
|
|
112
|
|
|
100
|
|
|||
Depreciation and amortization expense
|
|
218
|
|
|
215
|
|
|
207
|
|
|||
Impairment charges
|
|
86
|
|
|
2
|
|
|
20
|
|
|||
Total operating expense
|
|
1,805
|
|
|
1,651
|
|
|
1,590
|
|
|||
Operating income
|
|
63
|
|
|
101
|
|
|
109
|
|
|||
OTHER INCOME (EXPENSE)
|
|
|
|
|
|
|
||||||
Interest expense
|
|
(145
|
)
|
|
(147
|
)
|
|
(138
|
)
|
|||
Gain (loss) on sale of business
|
|
217
|
|
|
(6
|
)
|
|
44
|
|
|||
Loss on extinguishment of debt
|
|
(15
|
)
|
|
(84
|
)
|
|
—
|
|
|||
Other (expense) income, net
|
|
(3
|
)
|
|
1
|
|
|
(1
|
)
|
|||
Total other income (expense)
|
|
54
|
|
|
(236
|
)
|
|
(95
|
)
|
|||
Income (loss) before income tax benefit (expense) and equity in net income from unconsolidated investments
|
|
117
|
|
|
(135
|
)
|
|
14
|
|
|||
Income tax benefit (expense) (Note 11)
|
|
29
|
|
|
191
|
|
|
(22
|
)
|
|||
Equity in net income from unconsolidated investments
|
|
6
|
|
|
1
|
|
|
4
|
|
|||
NET INCOME (LOSS)
|
|
$
|
152
|
|
|
$
|
57
|
|
|
$
|
(4
|
)
|
|
|
|
|
|
|
|
||||||
Weighted Average Common Shares Outstanding:
|
|
|
|
|
|
|
||||||
Basic
|
|
130
|
|
|
130
|
|
|
129
|
|
|||
Diluted
|
|
132
|
|
|
131
|
|
|
129
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Earnings (Loss) Per Share:
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
1.17
|
|
|
$
|
0.44
|
|
|
$
|
(0.03
|
)
|
Diluted
|
|
$
|
1.15
|
|
|
$
|
0.44
|
|
|
$
|
(0.03
|
)
|
|
|
|
|
|
|
|
||||||
Cash Dividend Declared Per Share:
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
$
|
1.00
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In millions)
|
||||||||||
Net income (loss)
|
|
$
|
152
|
|
|
$
|
57
|
|
|
$
|
(4
|
)
|
Foreign currency translation, net of tax expense of $0, $0 and $0, respectively
|
|
1
|
|
|
17
|
|
|
(7
|
)
|
|||
Net unrealized gain (loss) on derivative instruments, net of tax benefit of $2, $0 and $8, respectively
|
|
21
|
|
|
(10
|
)
|
|
(21
|
)
|
|||
Other comprehensive income (loss)
|
|
22
|
|
|
7
|
|
|
(28
|
)
|
|||
Comprehensive income (loss)
|
|
$
|
174
|
|
|
$
|
64
|
|
|
$
|
(32
|
)
|
|
As of December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions, except per
share amounts)
|
||||||
ASSETS
|
|
|
|
||||
Current:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
58
|
|
|
$
|
46
|
|
Restricted funds held in trust
|
39
|
|
|
43
|
|
||
Receivables (less allowances of $8 and $14, respectively)
|
338
|
|
|
341
|
|
||
Prepaid expenses and other current assets
|
62
|
|
|
73
|
|
||
Assets held for sale
|
2
|
|
|
653
|
|
||
Total Current Assets
|
499
|
|
|
1,156
|
|
||
Property, plant and equipment, net
|
2,514
|
|
|
2,606
|
|
||
Restricted funds held in trust
|
8
|
|
|
28
|
|
||
Intangible assets, net
|
279
|
|
|
287
|
|
||
Goodwill
|
321
|
|
|
313
|
|
||
Other assets
|
222
|
|
|
51
|
|
||
Total Assets
|
$
|
3,843
|
|
|
$
|
4,441
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current:
|
|
|
|
||||
Current portion of long-term debt
|
$
|
15
|
|
|
$
|
10
|
|
Current portion of project debt
|
19
|
|
|
23
|
|
||
Accounts payable
|
76
|
|
|
151
|
|
||
Accrued expenses and other current liabilities
|
333
|
|
|
313
|
|
||
Liabilities held for sale
|
—
|
|
|
540
|
|
||
Total Current Liabilities
|
443
|
|
|
1,037
|
|
||
Long-term debt
|
2,327
|
|
|
2,339
|
|
||
Project debt
|
133
|
|
|
151
|
|
||
Deferred income taxes
|
378
|
|
|
412
|
|
||
Other liabilities
|
75
|
|
|
75
|
|
||
Total Liabilities
|
3,356
|
|
|
4,014
|
|
||
Commitments and Contingencies (Note 17)
|
|
|
|
||||
Equity:
|
|
|
|
||||
Preferred stock ($0.10 par value; authorized 10 shares; none issued and outstanding)
|
—
|
|
|
—
|
|
||
Common stock ($0.10 par value; authorized 250 shares; issued 136 shares, outstanding 131 shares)
|
14
|
|
|
14
|
|
||
Additional paid-in capital
|
841
|
|
|
822
|
|
||
Accumulated other comprehensive loss
|
(33
|
)
|
|
(55
|
)
|
||
Accumulated deficit
|
(334
|
)
|
|
(353
|
)
|
||
Treasury stock, at par
|
(1
|
)
|
|
(1
|
)
|
||
Total Equity
|
487
|
|
|
427
|
|
||
Total Liabilities and Equity
|
$
|
3,843
|
|
|
$
|
4,441
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
OPERATING ACTIVITIES:
|
|
(In millions)
|
||||||||||
Net income (loss)
|
|
$
|
152
|
|
|
$
|
57
|
|
|
$
|
(4
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation and amortization expense
|
|
218
|
|
|
215
|
|
|
207
|
|
|||
Amortization of long-term debt deferred financing costs
|
|
5
|
|
|
7
|
|
|
6
|
|
|||
(Gain) loss on sale of business
|
|
(217
|
)
|
|
6
|
|
|
(44
|
)
|
|||
Impairment charges
|
|
86
|
|
|
2
|
|
|
20
|
|
|||
Loss on extinguishment of debt
|
|
15
|
|
|
84
|
|
|
—
|
|
|||
Provision for doubtful accounts
|
|
2
|
|
|
9
|
|
|
2
|
|
|||
Stock-based compensation expense
|
|
24
|
|
|
18
|
|
|
16
|
|
|||
Equity in net income from unconsolidated investments
|
|
(6
|
)
|
|
(1
|
)
|
|
(4
|
)
|
|||
Deferred income taxes
|
|
(31
|
)
|
|
(193
|
)
|
|
21
|
|
|||
Dividends from unconsolidated investments
|
|
13
|
|
|
2
|
|
|
2
|
|
|||
Other, net
|
|
(10
|
)
|
|
(13
|
)
|
|
(1
|
)
|
|||
Change in working capital, net of effects of acquisitions:
|
|
|
|
|
|
|
||||||
Receivables
|
|
7
|
|
|
(27
|
)
|
|
(19
|
)
|
|||
Prepaid and other current assets
|
|
(3
|
)
|
|
5
|
|
|
17
|
|
|||
Accounts payable and accrued expenses
|
|
(16
|
)
|
|
66
|
|
|
43
|
|
|||
Changes in noncurrent assets and liabilities, net
|
|
(1
|
)
|
|
5
|
|
|
2
|
|
|||
Net cash provided by operating activities
|
|
238
|
|
|
242
|
|
|
264
|
|
|||
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Purchase of property, plant and equipment
|
|
(206
|
)
|
|
(277
|
)
|
|
(359
|
)
|
|||
Acquisition of businesses, net of cash acquired
|
|
(50
|
)
|
|
(16
|
)
|
|
(9
|
)
|
|||
Proceeds from asset sales
|
|
128
|
|
|
4
|
|
|
109
|
|
|||
Property insurance proceeds
|
|
18
|
|
|
8
|
|
|
3
|
|
|||
Payment of indemnification claim from sale of asset
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|||
Investment in equity affiliate
|
|
(16
|
)
|
|
—
|
|
|
—
|
|
|||
Other, net
|
|
(6
|
)
|
|
(8
|
)
|
|
2
|
|
|||
Net cash used in investing activities
|
|
(139
|
)
|
|
(289
|
)
|
|
(254
|
)
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In millions)
|
||||||||||
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
||||||
Proceeds from borrowings on long-term debt
|
|
1,165
|
|
|
400
|
|
|
—
|
|
|||
Proceeds from borrowings on revolving credit facility
|
|
740
|
|
|
952
|
|
|
744
|
|
|||
Proceeds from insurance premium financing
|
|
25
|
|
|
24
|
|
|
—
|
|
|||
Payments of equipment financing capital lease
|
|
(5
|
)
|
|
(5
|
)
|
|
(4
|
)
|
|||
Proceeds from borrowings on Dublin project financing
|
|
—
|
|
|
643
|
|
|
159
|
|
|||
Payment related to Dublin interest rate swap
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|||
Payments on the Dublin Convertible Preferred
|
|
—
|
|
|
(132
|
)
|
|
—
|
|
|||
Payments on long-term debt
|
|
(939
|
)
|
|
(415
|
)
|
|
(4
|
)
|
|||
Payments on revolving credit facility
|
|
(973
|
)
|
|
(850
|
)
|
|
(749
|
)
|
|||
Payments on project debt
|
|
(23
|
)
|
|
(382
|
)
|
|
(51
|
)
|
|||
Payments of deferred financing costs
|
|
(16
|
)
|
|
(21
|
)
|
|
(6
|
)
|
|||
Payment of Dublin financing costs
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
|||
Cash dividends paid to stockholders'
|
|
(134
|
)
|
|
(131
|
)
|
|
(131
|
)
|
|||
Common stock repurchased
|
|
—
|
|
|
—
|
|
|
(20
|
)
|
|||
Payment of insurance premium financing
|
|
(24
|
)
|
|
(4
|
)
|
|
—
|
|
|||
Other, net
|
|
(5
|
)
|
|
(3
|
)
|
|
(10
|
)
|
|||
Net cash (used in) provided by financing activities
|
|
(189
|
)
|
|
40
|
|
|
(72
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
1
|
|
|
7
|
|
|
—
|
|
|||
Net decrease in cash, cash equivalents and restricted cash
|
|
(89
|
)
|
|
—
|
|
|
(62
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
|
194
|
|
|
194
|
|
|
256
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
|
105
|
|
|
194
|
|
|
194
|
|
|||
Less: cash, cash equivalents and restricted cash of assets held for sale at end of period
|
|
—
|
|
|
77
|
|
|
—
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
|
$
|
105
|
|
|
$
|
117
|
|
|
$
|
194
|
|
|
|
|
|
|
|
|
||||||
Reconciliation of cash, cash equivalents and restricted cash:
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
|
$
|
58
|
|
|
$
|
46
|
|
|
$
|
84
|
|
Restricted funds held in trust- short term
|
|
39
|
|
|
43
|
|
|
56
|
|
|||
Restricted funds held in trust- long term
|
|
8
|
|
|
28
|
|
|
54
|
|
|||
Total cash, cash equivalents and restricted cash
|
|
$
|
105
|
|
|
$
|
117
|
|
|
$
|
194
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
||||||
Cash Paid for Interest and Income Taxes:
|
|
|
|
|
|
|
||||||
Interest
|
|
$
|
136
|
|
|
$
|
149
|
|
|
$
|
150
|
|
Income taxes, net of refunds
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
|
|
|
|
|
|
|
|
Covanta Holding Corporation Stockholders’ Equity
|
|
Noncontrolling
Interests in
Subsidiaries
|
|
Total
|
||||||||||||||||||||||||||||
|
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Accumulated
Earnings (Deficit)
|
|
Treasury Stock
|
|
|||||||||||||||||||||||
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|||||||||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||||
Balance as of December 31, 2015
|
|
136
|
|
|
$
|
14
|
|
|
$
|
801
|
|
|
$
|
(34
|
)
|
|
$
|
(143
|
)
|
|
5
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
640
|
|
Stock-based compensation expense
|
|
—
|
|
|
—
|
|
|
16
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16
|
|
|||||||
Dividend declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(132
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(132
|
)
|
|||||||
Common stock repurchased
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(11
|
)
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
(18
|
)
|
|||||||
Shares repurchased for tax withholdings for vested stock awards
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|||||||
Exchange of China equity investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
|||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||||
Comprehensive loss, net of income taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28
|
)
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(32
|
)
|
|||||||
Balance as of December 31, 2016
|
|
136
|
|
|
$
|
14
|
|
|
$
|
807
|
|
|
$
|
(62
|
)
|
|
$
|
(289
|
)
|
|
6
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
469
|
|
Cumulative effect change in accounting for share based payments
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|||||||
Stock-based compensation expense
|
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||||
Dividend declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(132
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(132
|
)
|
|||||||
Shares repurchased for tax withholdings for vested stock awards
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|||||||
Shares issued in non-vested stock award
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||||
Comprehensive income, net of income taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
57
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
64
|
|
|||||||
Balance as of December 31, 2017
|
|
136
|
|
|
$
|
14
|
|
|
$
|
822
|
|
|
$
|
(55
|
)
|
|
$
|
(353
|
)
|
|
5
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
427
|
|
Cumulative effect change in accounting for revenue recognition (Note 1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||||
Stock-based compensation expense
|
|
—
|
|
|
—
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|||||||
Dividend declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(133
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(133
|
)
|
|||||||
Shares repurchased for tax withholdings for vested stock awards
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||||||
Other
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Comprehensive income, net of income taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|
152
|
|
|
|
|
|
—
|
|
|
—
|
|
|
174
|
|
|||||||
Balance as of December 31, 2018
|
|
136
|
|
|
$
|
14
|
|
|
$
|
841
|
|
|
$
|
(33
|
)
|
|
$
|
(334
|
)
|
|
5
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
487
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Pass through costs
|
$
|
57
|
|
|
$
|
59
|
|
|
$
|
41
|
|
|
|
As of December 31,
|
||||||||||||||
|
|
2018
|
|
2017
|
||||||||||||
|
|
Current
|
|
Noncurrent
|
|
Current
|
|
Noncurrent
|
||||||||
Debt service funds - principal
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
10
|
|
|
$
|
8
|
|
Debt service funds - interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total debt service funds
|
|
16
|
|
|
—
|
|
|
10
|
|
|
8
|
|
||||
Revenue funds
|
|
4
|
|
|
—
|
|
|
4
|
|
|
—
|
|
||||
Other funds
|
|
19
|
|
|
8
|
|
|
29
|
|
|
20
|
|
||||
Total
|
|
$
|
39
|
|
|
$
|
8
|
|
|
$
|
43
|
|
|
$
|
28
|
|
|
|
As of December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Land
|
|
$
|
26
|
|
|
$
|
25
|
|
Facilities and equipment
|
|
4,367
|
|
|
4,312
|
|
||
Landfills (primarily for ash disposal)
|
|
75
|
|
|
67
|
|
||
Construction in progress
|
|
71
|
|
|
54
|
|
||
Total
|
|
4,539
|
|
|
4,458
|
|
||
Less: accumulated depreciation and amortization
|
|
(2,025
|
)
|
|
(1,852
|
)
|
||
Property, plant, and equipment — net
|
|
$
|
2,514
|
|
|
$
|
2,606
|
|
|
|
As of December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Beginning of period asset retirement obligation
|
|
$
|
26
|
|
|
$
|
25
|
|
Accretion expense
|
|
3
|
|
|
2
|
|
||
Net change
(1)
|
|
—
|
|
|
(1
|
)
|
||
End of period asset retirement obligation
|
|
29
|
|
|
26
|
|
||
Less: current portion
|
|
(5
|
)
|
|
(2
|
)
|
||
Noncurrent asset retirement obligation
|
|
$
|
24
|
|
|
$
|
24
|
|
(1)
|
Comprised primarily of expenditures and settlements of the asset retirement obligation liability, net revisions based on current estimates of the liability and revised expected cash flows and life of the liability.
|
|
Foreign Currency Translation
|
|
Pension and Other Postretirement Plan Unrecognized Net Gain
|
|
Net Unrealized Loss on Derivatives
|
|
Total
|
||||||||
Balance at December 31, 2016
|
$
|
(41
|
)
|
|
$
|
2
|
|
|
$
|
(23
|
)
|
|
$
|
(62
|
)
|
Other comprehensive income (loss) before reclassifications
|
17
|
|
|
—
|
|
|
(10
|
)
|
|
7
|
|
||||
Balance at December 31, 2017
|
$
|
(24
|
)
|
|
$
|
2
|
|
|
$
|
(33
|
)
|
|
$
|
(55
|
)
|
Other comprehensive loss before reclassifications
|
(1
|
)
|
|
—
|
|
|
(6
|
)
|
|
(7
|
)
|
||||
Amounts reclassified from accumulated other comprehensive loss
|
2
|
|
|
—
|
|
|
27
|
|
|
29
|
|
||||
Net current period comprehensive income
|
1
|
|
|
—
|
|
|
21
|
|
|
22
|
|
||||
Balance at December 31, 2018
|
$
|
(23
|
)
|
|
$
|
2
|
|
|
$
|
(12
|
)
|
|
$
|
(33
|
)
|
|
|
December 31, 2017
|
|
December 31, 2016
|
||||||||||||
|
|
As adjusted
|
|
As previously reported
|
|
As adjusted
|
|
As previously reported
|
||||||||
Cash and cash equivalents
|
|
$
|
46
|
|
|
$
|
46
|
|
|
$
|
84
|
|
|
$
|
84
|
|
Restricted funds classified as held for sale
|
|
77
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Restricted funds held in trust- short term
|
|
43
|
|
|
—
|
|
|
56
|
|
|
—
|
|
||||
Restricted funds held in trust- long term
|
|
28
|
|
|
—
|
|
|
54
|
|
|
—
|
|
||||
Beginning of period balance presented in the statement of cash flows
|
|
$
|
194
|
|
|
$
|
46
|
|
|
$
|
194
|
|
|
$
|
84
|
|
|
|
Year Ended December 31, 2017
|
|
Year Ended December 31, 2016
|
||||||||||||
|
|
As adjusted
|
|
As previously reported
|
|
As adjusted
|
|
As previously reported
|
||||||||
Cash provided by operating activities
|
|
$
|
242
|
|
|
$
|
243
|
|
|
$
|
264
|
|
|
$
|
286
|
|
Cash used in investing activities
|
|
$
|
(289
|
)
|
|
$
|
(289
|
)
|
|
$
|
(254
|
)
|
|
$
|
(254
|
)
|
Cash provided by financing activities
|
|
$
|
40
|
|
|
$
|
3
|
|
|
$
|
(72
|
)
|
|
$
|
(44
|
)
|
Standard
|
Description
|
Effective Date
|
Effect on the financial statements
or other significant matters
|
Update 2018-13—Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement
|
Entities are no longer required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy. The update also eliminates the requirement to disclose policy for timing of transfers between levels of the fair value hierarchy. Public companies will be required to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 measurements. The amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented upon their effective date.
|
First quarter of 2020, early adoption is permitted.
|
We are currently evaluating the impact this guidance will have on our consolidated financial statements.
|
ASU 2018-02
Income Statement—Reporting Comprehensive Income
(Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income
|
The amendments in this update allow a reclassification from accumulated other comprehensive income ("AOCI") to retained earnings for adjustments to the tax effect of items in AOCI, that were originally recognized in other comprehensive income, related to the new statutory rate prescribed in the Tax Cuts and Jobs Act enacted on December 22, 2017, which reduces the US federal corporate tax rate from 35% to 21%. The amendments in this update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the US federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized.
|
First quarter of 2019, early adoption is permitted, including adoption in any interim period.
|
We are currently evaluating the impact this guidance will have on our consolidated financial statements.
|
ASU 2016-13
Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments |
The standard amends guidance on the impairment of financial instruments. The ASU estimates credit losses based on expected losses and provides for a simplified accounting model for purchased financial assets with credit deterioration. The standard requires a modified retrospective basis adoption through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption.
|
First quarter of 2020, early adoption is permitted.
|
We are currently evaluating the impact this guidance will have on our consolidated financial statements.
|
ASU 2016-02
Leases (Topic 842) as amended by ASU 2018-01 and ASU 2018-11 |
These standards amended guidance for lease arrangements to increase transparency and comparability by providing additional information to users of financial statements regarding an entity's leasing activities. The revised guidance seeks to achieve this objective by requiring reporting entities to recognize lease assets and lease liabilities on the balance sheet for substantially all lease arrangements. The standard requires a modified retrospective basis adoption.
The amendment in ASU 2018-01 permits an entity to elect an optional transition practical expedient to not evaluate land easements that exist or expired before the entity’s adoption of Topic 842 and that were not previously accounted for as leases under Topic 840.
The amendment in ASU 2018-11 provides entities with an additional and optional transition method in adopting the new leases standard and providing lessors with a practical expedient to not separate nonlease components from the associated lease component, similar to Topic 842 expedients for lessees.
|
First quarter of 2019, early adoption is permitted.
|
As part of our impact assessment, we performed a scoping exercise and determined our lease population. Based on an evaluation of the population, we determined the 1/1/2019 ROU Asset and ROU Liability balance to be in the range of $60-$70 million for operating leases.
Additionally, we are in the process of implementing a lease accounting system and refining our internal controls and processes related to both the implementation and ongoing compliance of the new guidance. We plan to adopt the new guidance using a modified retrospective approach and upon adoption, there will be an increase to our long-term assets and liabilities reflecting the present value of our minimum lease obligations, which are disclosed in Note 9.
|
Restricted funds held in trust
|
$
|
77
|
|
Receivables
|
10
|
|
|
Property, plant and equipment, net
|
563
|
|
|
Other assets
|
3
|
|
|
Assets held for sale
|
$
|
653
|
|
|
|
||
Accounts payable
|
1
|
|
|
Accrued expenses and other liabilities
|
22
|
|
|
Project debt
(1)
|
510
|
|
|
Deferred income tax
|
7
|
|
|
Liabilities held for sale
|
$
|
540
|
|
(1)
|
See
Note 16.
Consolidated Debt - Dublin Project Refinancing
for further information.
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Total repurchases
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18
|
|
Shares repurchased
|
—
|
|
|
—
|
|
|
1.2
|
|
|||
Weighted average cost per share
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
15.29
|
|
|
Year Ended December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
Basic weighted average common shares outstanding
|
130
|
|
|
130
|
|
|
129
|
|
Dilutive effect of stock options, restricted stock and restricted stock units
|
2
|
|
|
1
|
|
|
—
|
|
Diluted weighted average common shares outstanding
|
132
|
|
|
131
|
|
|
129
|
|
Anti-dilutive stock options, restricted stock and restricted stock units excluded from the calculation of EPS
|
—
|
|
|
—
|
|
|
3
|
|
|
|
United States
|
|
Other
|
|
Total
|
||||||||||
Operating Revenue:
|
|
|
|
|
|
|
||||||||||
Year Ended December 31, 2018
|
|
$
|
1,785
|
|
|
$
|
83
|
|
|
$
|
1,868
|
|
||||
Year Ended December 31, 2017
|
|
$
|
1,705
|
|
|
$
|
47
|
|
|
$
|
1,752
|
|
||||
Year Ended December 31, 2016
|
|
$
|
1,677
|
|
|
$
|
22
|
|
|
$
|
1,699
|
|
||||
|
||||||||||||||||
|
|
Assets Held
for Sale
|
|
United States
|
|
Other
|
|
Total
|
||||||||
Total Assets:
|
|
|
|
|
|
|
|
|
||||||||
As of December 31, 2018
|
|
$
|
2
|
|
|
$
|
3,633
|
|
|
$
|
208
|
|
|
$
|
3,843
|
|
As of December 31, 2017
|
|
$
|
653
|
|
|
$
|
3,727
|
|
|
$
|
61
|
|
|
$
|
4,441
|
|
As of December 31, 2016
|
|
$
|
—
|
|
|
$
|
3,763
|
|
|
$
|
521
|
|
|
$
|
4,284
|
|
Revenue Type
|
|
Timing
|
|
Performance Obligations
|
|
Measure of Progress
|
|
Type
|
|
Practical Expedients
|
Service Fee
|
|
Over time
|
|
Operations/waste disposal
|
|
Time elapsed
|
|
Fixed
& Variable
|
|
Constrained
(1)
& Series (2) |
Tip Fee
|
|
Over time
|
|
Waste disposal
|
|
Units delivered
|
|
Fixed
& Variable
|
|
Right to invoice
|
Energy
|
|
Over time
|
|
Energy
|
|
Units delivered
|
|
Fixed
& Variable
|
|
Right to invoice
& Series
(2)
|
Capacity
|
|
Time elapsed
|
|
|||||||
Steam
|
|
Units delivered
|
|
|||||||
Metals
|
|
Point in time
|
|
Sale of ferrous &
non-ferrous metals
|
|
Units delivered
|
|
Variable
|
|
Less than 1 year
|
Other (Construction)
|
|
Over time
|
|
Construction
services
|
|
Costs incurred
|
|
Fixed
& Variable
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
(1) The amount of variable consideration that is included in the transaction price may be constrained, and is included only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. We estimate our variable service fee using the expected value method.
|
||||||||||
(2) Service Fee and Energy contracts have been determined to have an annual and monthly series, respectively.
|
1.
|
The performance obligation is part of a contract that has an original expected duration of one year or less.
|
2.
|
Revenue is recognized from the satisfaction of the performance obligations in the amount billable to our customer that corresponds directly with the value to the customer of our performance completed to date (i.e. “right-to-invoice” practical expedient).
|
3.
|
The variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct service or a series of distinct services that are substantially the same and that have the same pattern of transfer to our customer (i.e. “series practical expedient”).
|
|
Total
|
||
Total Remaining performance obligation
|
$
|
6,147
|
|
Percentage expected to be recognized:
|
|
||
2019
|
11
|
%
|
|
2020
|
9
|
%
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Unbilled receivables
|
|
$
|
16
|
|
|
$
|
13
|
|
Deferred revenue
|
|
$
|
15
|
|
|
$
|
14
|
|
|
|
|
|
|
|
|
|
As of December 31, 2018
|
||||||||||
|
|
Total Compensation Expense
Year Ended December 31,
|
Unrecognized
stock-based
compensation expense
|
|
Weighted-average years to be recognized
|
|||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
|||||||||||
Restricted Stock Awards
|
|
$
|
5
|
|
|
$
|
11
|
|
|
$
|
10
|
|
|
$
|
2
|
|
|
0.9
|
Restricted Stock Units
|
|
$
|
19
|
|
|
$
|
7
|
|
|
$
|
6
|
|
|
$
|
12
|
|
|
1.7
|
Tax benefit related to compensation expense
|
|
$
|
18
|
|
|
$
|
10
|
|
|
$
|
10
|
|
|
|
|
|
|
|
Number of Shares
|
|
Weighted-Average Grant Date Fair Value
|
|||
Nonvested at the beginning of the year
|
|
1,389
|
|
|
$
|
16.46
|
|
Granted
|
|
13
|
|
|
$
|
15.20
|
|
Vested
|
|
(638
|
)
|
|
$
|
17.09
|
|
Forfeited
|
|
(37
|
)
|
|
$
|
16.01
|
|
Nonvested at the end of the year
|
|
727
|
|
|
$
|
15.90
|
|
|
|
Number of Shares
|
|
Weighted-Average
Grant Date Fair Value
|
|||
Nonvested at the beginning of the year
|
|
1,815
|
|
|
$
|
15.80
|
|
Granted
|
|
1,705
|
|
|
$
|
15.01
|
|
Vested
|
|
(467
|
)
|
|
$
|
17.52
|
|
Forfeited
|
|
(55
|
)
|
|
$
|
14.79
|
|
Nonvested at the end of the year
|
|
2,998
|
|
|
$
|
15.11
|
|
|
|
Shares
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Remaining Contractual Term (Years)
|
|
Aggregate Intrinsic Value
(2)
|
|||||
2014 Stock Option Plan
|
|
(in thousands, except per share amounts)
|
|||||||||||
Outstanding at the beginning of the year
|
|
225
|
|
|
$
|
24.30
|
|
|
|
|
|
||
Granted
|
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Exercised
|
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Expired
|
|
(200
|
)
|
|
$
|
24.76
|
|
|
|
|
|
||
Forfeited
|
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Outstanding at the end of the year
(1)
|
|
25
|
|
|
$
|
20.58
|
|
|
5.52
|
|
$
|
—
|
|
Options exercisable at year end
|
|
25
|
|
|
$
|
20.58
|
|
|
5.52
|
|
$
|
—
|
|
(1)
|
All options outstanding as of
December 31, 2018
are fully vested.
|
(2)
|
The aggregate intrinsic value represents the total pre-tax intrinsic value (the difference between the closing stock price on the last trading day of
2018
and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on the last trading day of
2018
. The intrinsic value changes based on the fair market value of our common stock.
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
|
Total
|
||||||||||||||
Future minimum rental payments
|
|
$
|
11
|
|
|
$
|
9
|
|
|
$
|
8
|
|
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
36
|
|
|
$
|
78
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Insurance gains for property and clean-up costs, net of impairment charges
|
$
|
18
|
|
|
$
|
7
|
|
|
$
|
1
|
|
Insurance gains for business interruption costs, net of costs incurred
|
$
|
19
|
|
|
$
|
23
|
|
|
$
|
4
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
||||||
Impairment charges
|
$
|
86
|
|
|
$
|
2
|
|
|
$
|
20
|
|
|
As of December 31,
|
||||||
|
2018
|
|
2017
|
||||
Prepaid expenses
|
$
|
22
|
|
|
$
|
22
|
|
Spare parts
|
21
|
|
|
22
|
|
||
Renewable energy credits
|
7
|
|
|
6
|
|
||
Other
|
12
|
|
|
23
|
|
||
Total prepaid expenses and other current assets
|
$
|
62
|
|
|
$
|
73
|
|
|
|
|
|
||||
Operating expenses, payroll and related expenses
|
$
|
150
|
|
|
$
|
145
|
|
Deferred revenue
|
10
|
|
|
14
|
|
||
Accrued liabilities to client communities
|
26
|
|
|
17
|
|
||
Interest payable
|
38
|
|
|
37
|
|
||
Dividends payable
|
36
|
|
|
36
|
|
||
Other
|
73
|
|
|
64
|
|
||
Total accrued expenses and other current liabilities
|
$
|
333
|
|
|
$
|
313
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
(2
|
)
|
State
|
|
1
|
|
|
2
|
|
|
6
|
|
|||
Foreign
|
|
1
|
|
|
(1
|
)
|
|
(2
|
)
|
|||
Total current
|
|
2
|
|
|
5
|
|
|
2
|
|
|||
Deferred:
|
|
|
|
|
|
|
||||||
Federal
|
|
(1
|
)
|
|
(204
|
)
|
|
28
|
|
|||
State
|
|
(25
|
)
|
|
(2
|
)
|
|
(9
|
)
|
|||
Foreign
|
|
(5
|
)
|
|
10
|
|
|
1
|
|
|||
Total deferred
|
|
(31
|
)
|
|
(196
|
)
|
|
20
|
|
|||
Total income tax (benefit) expense
|
|
$
|
(29
|
)
|
|
$
|
(191
|
)
|
|
$
|
22
|
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Income tax expense (benefit) at the federal statutory rate
|
|
$
|
25
|
|
|
$
|
(47
|
)
|
|
$
|
5
|
|
State and other tax expense
|
|
(1
|
)
|
|
(2
|
)
|
|
1
|
|
|||
Tax rate differential on foreign earnings
|
|
1
|
|
|
10
|
|
|
4
|
|
|||
Income from grantor trust
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|||
Gain on sale of business
|
|
(44
|
)
|
|
—
|
|
|
—
|
|
|||
Permanent differences
|
|
3
|
|
|
4
|
|
|
4
|
|
|||
Foreign currency exchange gain
|
|
2
|
|
|
—
|
|
|
—
|
|
|||
Impact of state tax law change
|
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||
State ITC credit
|
|
1
|
|
|
1
|
|
|
(4
|
)
|
|||
Change in valuation allowance
|
|
—
|
|
|
31
|
|
|
2
|
|
|||
Liability for uncertain tax positions
|
|
(4
|
)
|
|
—
|
|
|
15
|
|
|||
Adjustment to deferred tax
|
|
—
|
|
|
(1
|
)
|
|
(5
|
)
|
|||
Impact of deferred tax re-measurement for federal tax rate change
|
|
—
|
|
|
(204
|
)
|
|
—
|
|
|||
Tax reform transition tax
|
|
1
|
|
|
21
|
|
|
—
|
|
|||
Expiration of non-qualified stock options
|
|
—
|
|
|
3
|
|
|
—
|
|
|||
Other
|
|
—
|
|
|
1
|
|
|
—
|
|
|||
Total income tax (benefit) expense
|
|
$
|
(29
|
)
|
|
$
|
(191
|
)
|
|
$
|
22
|
|
|
|
||
|
Amount of
Carryforward
Expiring
|
||
2033
|
$
|
194
|
|
2035
|
1
|
|
|
2036
|
1
|
|
|
2037
|
1
|
|
|
|
$
|
197
|
|
|
|
As of December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Net operating loss carryforwards
|
|
$
|
90
|
|
|
$
|
119
|
|
Accrued expenses
|
|
13
|
|
|
15
|
|
||
Prepaid and other costs
|
|
48
|
|
|
48
|
|
||
Deferred tax assets attributable to pass-through entities
|
|
10
|
|
|
10
|
|
||
Retirement benefits
|
|
1
|
|
|
2
|
|
||
State adjustment
|
|
5
|
|
|
—
|
|
||
Hedging
|
|
4
|
|
|
—
|
|
||
Other
|
|
1
|
|
|
3
|
|
||
Unbilled accounts
|
|
1
|
|
|
—
|
|
||
Interest expense
|
|
12
|
|
|
—
|
|
||
AMT and other credit carryforwards
|
|
49
|
|
|
48
|
|
||
Total gross deferred tax asset
|
|
234
|
|
|
245
|
|
||
Less: valuation allowance
|
|
(73
|
)
|
|
(77
|
)
|
||
Total deferred tax asset
|
|
161
|
|
|
168
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||||
Unbilled accounts receivable
|
|
—
|
|
|
3
|
|
||
Property, plant and equipment
|
|
521
|
|
|
538
|
|
||
Intangible assets
|
|
12
|
|
|
33
|
|
||
Deferred tax liabilities attributable to pass-through entities
|
|
5
|
|
|
8
|
|
||
Deferred gain on convertible debt
|
|
—
|
|
|
4
|
|
||
Other, net
|
|
1
|
|
|
1
|
|
||
Total gross deferred tax liability
|
|
539
|
|
|
587
|
|
||
Net deferred tax liability, including deferred tax liability held for sale
|
|
378
|
|
|
419
|
|
||
Less: Deferred tax liability held for sale
(1)
|
|
—
|
|
|
7
|
|
||
Net deferred tax liability
|
|
$
|
378
|
|
|
$
|
412
|
|
(1)
|
As of December 31, 2017, assets and liabilities related to our Dublin EfW facility met the criteria to be classified as held for sale on our consolidated balance sheet. For further information see
Note 4. Dispositions and Assets Held for Sale
.
|
Balance at December 31, 2015
|
$
|
36
|
|
Additions based on tax positions related to the current year
|
16
|
|
|
Additions for tax positions of prior years
|
4
|
|
|
Reductions for lapse in applicable statute of limitations
|
(3
|
)
|
|
Reductions for tax positions of prior years
|
(4
|
)
|
|
Payment
|
(6
|
)
|
|
Balance at December 31, 2016
|
43
|
|
|
Additions based on tax positions related to the current year
|
1
|
|
|
Additions for tax positions of prior years
|
6
|
|
|
Reductions for lapse in applicable statute of limitations
|
(1
|
)
|
|
Reductions for tax positions of prior years
|
(2
|
)
|
|
Additions due to acquisitions
|
1
|
|
|
Balance at December 31, 2017
|
48
|
|
|
Additions based on tax positions related to the current year
|
2
|
|
|
Additions for tax positions of prior years
|
1
|
|
|
Reductions for lapse in applicable statute of limitations
|
(2
|
)
|
|
Reductions for tax positions of prior years
|
(8
|
)
|
|
Balance at December 31, 2018
|
$
|
41
|
|
•
|
For marketable securities, the carrying value of these amounts is a reasonable estimate of their fair value.
|
•
|
Fair values for long-term debt and project debt are determined using quoted market prices (Level 1).
|
•
|
The fair values of our energy hedges were determined using the spread between our fixed price and the forward curve information available within the market.
|
|
|
|
|
As of December 31,
|
||||||
Financial Instruments Recorded at Fair Value on a Recurring Basis:
|
|
Fair Value Measurement Level
|
|
2018
|
|
2017
|
||||
|
|
|
|
(In millions)
|
||||||
Assets:
|
|
|
|
|
|
|
||||
Investments — mutual and bond funds
(1)
|
|
1
|
|
$
|
2
|
|
|
$
|
2
|
|
Total assets:
|
|
|
|
$
|
2
|
|
|
$
|
2
|
|
Liabilities:
|
|
|
|
|
|
|
||||
Derivative liability — energy hedges
(2)
|
|
2
|
|
$
|
13
|
|
|
$
|
5
|
|
Derivative liability — interest rate swaps included in liabilities held for sale
(3)
|
|
2
|
|
—
|
|
|
7
|
|
||
Total liabilities:
|
|
|
|
$
|
13
|
|
|
$
|
12
|
|
(1)
|
Included in other noncurrent assets in the consolidated balance sheets.
|
(2)
|
The short-term balance is included in Accrued expenses and other current liabilities and the long-term balance is included in Other liabilities in the consolidated balance sheets.
|
(3)
|
As of December 31, 2017, assets and liabilities related to our Dublin EfW facility met the criteria to be classified as held for sale on our consolidated balance sheet. For further information see
Note 4. Dispositions and Assets Held for Sale
.
|
|
|
As of December 31, 2018
|
|
As of December 31, 2017
|
||||||||||||
Financial Instruments Recorded at Carrying Amount:
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Long-term debt
|
|
$
|
2,342
|
|
|
$
|
2,245
|
|
|
$
|
2,349
|
|
|
$
|
2,371
|
|
Project debt
|
|
$
|
152
|
|
|
$
|
154
|
|
|
$
|
174
|
|
|
$
|
179
|
|
Project debt included in liabilities held for sale
(1)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
510
|
|
|
$
|
510
|
|
(1)
|
As of December 31, 2017, assets and liabilities related to our Dublin EfW facility met the criteria to be classified as held for sale on our consolidated balance sheet. For further information see
Note 4. Dispositions and Assets Held for Sale
.
|
|
|
December 31,
|
||||
Ownership interest:
|
|
2018
|
|
2017
|
||
Dublin EfW (Ireland)
(1)
|
|
50
|
%
|
|
—
|
%
|
Ambiente 2000 S.r.l. (Italy)
|
|
40
|
%
|
|
40
|
%
|
Earls Gate (UK)
(2)
|
|
25
|
%
|
|
—
|
%
|
South Fork Plant (US)
|
|
50
|
%
|
|
50
|
%
|
Koma Kulshan Plant (US)
|
|
—
|
%
|
|
50
|
%
|
Tartech (US)
|
|
—
|
%
|
|
50
|
%
|
(1)
|
We have a
50%
indirect ownership of Dublin EfW, through our 50/50 joint venture with GIG, Covanta Europe Assets Ltd.
|
(2)
|
We have a
25%
indirect ownership of Earls Gate, through our 50/50 joint venture with GIG, Covanta Green Jersey Assets Ltd., which owns
50%
of Earls Gate.
|
|
|
|
|
December 31,
|
||||||||
|
|
|
|
2018
|
|
2017
|
||||||
Balance Sheet:
|
|
|
|
|
|
|
||||||
Current assets
|
|
|
|
$
|
80
|
|
|
$
|
7
|
|
||
Long-term assets
|
|
|
|
$
|
834
|
|
|
$
|
17
|
|
||
Current liabilities
|
|
|
|
$
|
69
|
|
|
$
|
9
|
|
||
Long-term liabilities
|
|
|
|
$
|
521
|
|
|
$
|
2
|
|
||
|
|
|
|
|
|
|
||||||
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Statement of Operations:
|
|
|
|
|
|
|
||||||
Operating revenue
|
|
$
|
112
|
|
|
$
|
17
|
|
|
$
|
19
|
|
Operating income (loss)
|
|
$
|
31
|
|
|
$
|
1
|
|
|
$
|
(7
|
)
|
Net income (loss)
|
|
$
|
13
|
|
|
$
|
1
|
|
|
$
|
(7
|
)
|
Calendar Year
|
|
Hedged MWh
|
2019
|
|
2.8
|
2020
|
|
0.2
|
Total
|
|
3.0
|
|
|
|
|
As of December 31, 2018
|
|
As of December 31, 2017
|
||||||||||||||||||||
|
|
Remaining Weighted Average Useful
Life
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
Waste, service and energy contracts
|
|
19 years
|
|
$
|
522
|
|
|
$
|
271
|
|
|
$
|
251
|
|
|
$
|
494
|
|
|
$
|
243
|
|
|
$
|
251
|
|
Customer relationships, permits and other
|
|
5 years
|
|
$
|
52
|
|
|
$
|
24
|
|
|
$
|
28
|
|
|
$
|
54
|
|
|
$
|
18
|
|
|
36
|
|
|
Intangible assets, net
|
|
|
|
$
|
574
|
|
|
$
|
295
|
|
|
$
|
279
|
|
|
$
|
548
|
|
|
$
|
261
|
|
|
$
|
287
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Waste and service contracts (liability)
|
|
13 years
|
|
$
|
(72
|
)
|
|
$
|
(64
|
)
|
|
$
|
(8
|
)
|
|
$
|
(66
|
)
|
|
$
|
(62
|
)
|
|
$
|
(4
|
)
|
|
|
Year Ended December 31,
|
||||||||||
|
|
2018
|
|
2017
|
|
2016
|
||||||
Intangible assets, net
|
|
$
|
20
|
|
|
$
|
20
|
|
|
$
|
27
|
|
Waste and service contracts (contra-expense)
|
|
$
|
(2
|
)
|
|
$
|
(2
|
)
|
|
$
|
(6
|
)
|
|
|
Year Ended December 31,
|
|||||||||||||||||
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|||||||||
Intangible assets, net
|
|
26
|
|
|
30
|
|
|
28
|
|
|
16
|
|
|
13
|
|
||||
Waste and service contracts (contra-expense)
|
|
(2
|
)
|
|
$
|
(1
|
)
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Total
|
||
Balance at December 31, 2016
|
$
|
302
|
|
Goodwill related to acquisitions
|
11
|
|
|
Balance at December 31, 2017
|
313
|
|
|
Goodwill related to acquisitions
|
8
|
|
|
Balance at December 31, 2018
|
$
|
321
|
|
|
Average Rate
|
|
December 31, 2018
|
|
December 31, 2017
|
|||||
LONG-TERM DEBT:
|
|
|
|
|||||||
Revolving credit facility
|
4.19
|
%
|
|
$
|
212
|
|
|
$
|
445
|
|
Term loan, net due 2019
|
3.12
|
%
|
|
—
|
|
|
191
|
|
||
Term loan, net due 2023
|
4.27
|
%
|
|
394
|
|
|
—
|
|
||
Credit Facilities Sub-total
|
|
|
$
|
606
|
|
|
$
|
636
|
|
|
Senior Notes
|
|
|
1,200
|
|
|
1,200
|
|
|||
Less: deferred financing costs related to senior notes
|
|
|
(16
|
)
|
|
(15
|
)
|
|||
Senior Notes Sub-total
|
|
|
$
|
1,184
|
|
|
$
|
1,185
|
|
|
Tax-exempt bonds
|
|
|
$
|
494
|
|
|
$
|
464
|
|
|
Less: deferred financing costs related to tax-exempt bonds
|
|
|
(6
|
)
|
|
(5
|
)
|
|||
Tax-Exempt Bonds Sub-total
|
|
|
$
|
488
|
|
|
$
|
459
|
|
|
Equipment financing capital leases due 2024 through 2028
|
|
|
64
|
|
|
69
|
|
|||
Total long-term debt
|
|
|
$
|
2,342
|
|
|
$
|
2,349
|
|
|
Less: current portion
|
|
|
(15
|
)
|
|
(10
|
)
|
|||
Noncurrent long-term debt
|
|
|
$
|
2,327
|
|
|
$
|
2,339
|
|
|
PROJECT DEBT:
|
|
|
|
|
|
|||||
Project debt related to service fee structures
|
|
|
$
|
58
|
|
|
$
|
68
|
|
|
Union capital lease
|
|
|
89
|
|
|
94
|
|
|||
Project debt related to tip fee structures
|
|
|
3
|
|
|
9
|
|
|||
Unamortized debt premium, net
|
|
|
3
|
|
|
4
|
|
|||
Less: deferred financing costs
|
|
|
(1
|
)
|
|
(1
|
)
|
|||
Total project debt
|
|
|
$
|
152
|
|
|
$
|
174
|
|
|
Less: Current portion
|
|
|
(19
|
)
|
|
(23
|
)
|
|||
Noncurrent project debt
|
|
|
$
|
133
|
|
|
$
|
151
|
|
|
TOTAL CONSOLIDATED DEBT
|
|
|
$
|
2,494
|
|
|
$
|
2,523
|
|
|
Less: Current debt
|
|
|
(34
|
)
|
|
(33
|
)
|
|||
TOTAL NONCURRENT CONSOLIDATED DEBT
|
|
|
$
|
2,460
|
|
|
$
|
2,490
|
|
•
|
reduced the aggregate commitment amount of the Revolving Credit Facility by
$100 million
to
$900 million
and adjusted the pricing grid such that the initial applicable margin was reduced by 25 basis points as compared to the previous Revolving Credit Facility;
|
•
|
refinanced Covanta Energy's previous
$200 million
Term Loan with a new
$400 million
Term Loan; and
|
•
|
extended the maturity date of both the Term Loan and Revolving Credit Facility from March 2020 to August 2023.
|
|
Total
Facility Commitment
|
|
Expiring
|
|
Direct Borrowings
|
|
Outstanding Letters of Credit
|
|
Unutilized Capacity
|
||||||||
Revolving Credit Facility
|
$
|
900
|
|
|
2023
|
|
$
|
212
|
|
|
$
|
239
|
|
|
$
|
449
|
|
•
|
incur additional indebtedness (including guarantee obligations);
|
•
|
create certain liens against or security interests over certain property;
|
•
|
pay dividends on, redeem, or repurchase our capital stock or make other restricted junior payments;
|
•
|
enter into agreements that restrict the ability of our subsidiaries to make distributions or other payments to us;
|
•
|
make investments;
|
•
|
consolidate, merge or transfer all or substantially all of our assets and the assets of our subsidiaries on a consolidated basis;
|
•
|
dispose of certain assets; and
|
•
|
make certain acquisitions.
|
•
|
a maximum Leverage Ratio of
4.00
to 1.00 for the trailing four quarter period, which measures the principal amount of Covanta Energy’s consolidated debt less certain restricted funds dedicated to repayment of project debt principal and construction costs (“Consolidated Adjusted Debt”) to its adjusted earnings before interest, taxes, depreciation and amortization, as calculated in the Credit Agreement (“Credit Agreement Adjusted EBITDA”). The definition of Credit Agreement Adjusted EBITDA in the Credit Facilities excludes certain non-recurring and non-cash charges and may incorporate certain pro forma adjustments.
|
•
|
a minimum Interest Coverage Ratio of
3.00
to 1.00, which measures Covanta Energy’s Credit Agreement Adjusted EBITDA to its consolidated interest expense plus certain interest expense of ours, to the extent paid by Covanta Energy as calculated in the Credit Agreement.
|
Maturity
|
|
Rate
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
2027
|
|
6.000%
|
|
$
|
400
|
|
|
$
|
—
|
|
2025
|
|
5.875%
|
|
400
|
|
|
400
|
|
||
2024
|
|
5.875%
|
|
400
|
|
|
400
|
|
||
2022
|
|
6.375%
|
|
—
|
|
|
400
|
|
||
|
|
|
|
$
|
1,200
|
|
|
$
|
1,200
|
|
•
|
general unsecured obligations of Covanta and are not guaranteed by any of our subsidiaries;
|
•
|
rank equally in right of payment with all of our existing and future senior unsecured indebtedness that is not subordinated in right of payment to the Senior Notes;
|
•
|
are effectively subordinated in right of payment to any of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness;
|
•
|
are structurally subordinated to any existing and future liabilities of any of our subsidiaries, including Covanta Energy, including their guarantees under certain of our Tax-Exempt Bonds;
|
•
|
governed by the Base Indenture as supplemented by the supplemental indentures;
|
•
|
are subject to redemption at our option, in whole or in part, subject to the terms of their respective supplemental indentures;
|
•
|
are redeemable at our option using the proceeds of certain equity offerings subject to the terms of their respective supplemental indentures.
|
Series
|
|
Maturity
|
|
Coupon
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
New Hampshire Series 2018A
|
|
2027
|
|
4.000%
|
|
$
|
20
|
|
|
$
|
—
|
|
New Hampshire Series 2018B
|
|
2042
|
|
4.625%
|
|
67
|
|
|
—
|
|
||
New Hampshire Series 2018C
|
|
2042
|
|
4.875%
|
|
82
|
|
|
—
|
|
||
New York Series 2018A
|
|
2042
|
|
4.750%
|
|
130
|
|
|
—
|
|
||
New York Series 2018B
|
|
2024
|
|
3.500%
|
|
35
|
|
|
—
|
|
||
Virginia Series
|
|
2038
|
|
5.000%
|
|
30
|
|
|
—
|
|
||
New Jersey Series 2015A
|
|
2045
|
|
5.250%
|
|
90
|
|
|
90
|
|
||
Pennsylvania Series 2015A
|
|
2043
|
|
5.000%
|
|
40
|
|
|
40
|
|
||
Massachusetts Series 2012A
|
|
2027
|
|
4.875%
|
|
—
|
|
|
20
|
|
||
Massachusetts Series 2012B
|
|
2042
|
|
4.875%
|
|
—
|
|
|
67
|
|
||
Massachusetts Series 2012C
|
|
2042
|
|
5.250%
|
|
—
|
|
|
82
|
|
||
Niagara Series 2012A
|
|
2042
|
|
5.250%
|
|
—
|
|
|
130
|
|
||
Niagara Series 2012B
|
|
2024
|
|
4.000%
|
|
—
|
|
|
35
|
|
||
|
|
|
|
|
|
$
|
494
|
|
|
$
|
464
|
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
||||||||||||
Future minimum payments
|
|
$
|
5
|
|
|
$
|
6
|
|
|
$
|
6
|
|
|
$
|
6
|
|
|
$
|
7
|
|
|
$
|
59
|
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
||||||||||||
Future minimum payments
|
|
$
|
5
|
|
|
$
|
6
|
|
|
$
|
6
|
|
|
$
|
6
|
|
|
$
|
6
|
|
|
$
|
35
|
|
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
|
Total
|
|
Less:
Current
Portion
|
|
Total
Noncurrent
Project Debt
|
||||||||||||||||||
Debt
|
|
$
|
19
|
|
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
9
|
|
|
$
|
9
|
|
|
$
|
97
|
|
|
$
|
150
|
|
|
$
|
(19
|
)
|
|
$
|
131
|
|
Premium and deferred financing costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||||||
Total
(1)
|
|
$
|
19
|
|
|
$
|
8
|
|
|
$
|
8
|
|
|
$
|
9
|
|
|
$
|
9
|
|
|
$
|
99
|
|
|
$
|
152
|
|
|
$
|
(19
|
)
|
|
$
|
133
|
|
|
|
Minimum
|
|
Maximum
|
||
Project debt related to service fee structures due through 2035
|
|
4.00
|
%
|
|
5.00
|
%
|
Project debt related to tip fee structures due through 2020
|
|
5.25
|
%
|
|
6.20
|
%
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Capitalized interest
|
$
|
—
|
|
|
$
|
17
|
|
|
$
|
26
|
|
Dublin Senior Loan due 2032 (2.77% - 3.57%) ⁽¹⁾
|
$
|
474
|
|
Less: debt discount related to Dublin Senior Loan
|
(10
|
)
|
|
Less: deferred financing costs related to Dublin Senior Loan
|
(13
|
)
|
|
Dublin Senior Loan, net
|
451
|
|
|
Dublin Junior Loan due 2032 (4.23%-5.36%)
|
$
|
60
|
|
Less: deferred financing costs related to Dublin Junior Loan
|
(1
|
)
|
|
Dublin Junior Loan, net
|
59
|
|
|
Total project debt included in Liabilities held for sale, net
|
$
|
510
|
|
(1)
Reflects hedged fixed rates.
|
|
•
|
Final maturity on November 24, 2032 (approximately 15 years after the operational commencement date of the facility).
|
•
|
Scheduled repayments will be made semi-annually according to a 15-year amortization profile, beginning in 2018. The Dublin Senior Loan is pre-payable at our option, subject to potential prepayment costs under Tranche A and B.
|
•
|
Borrowings will bear interest as follows:
|
•
|
Tranche A: At a fixed rate equal to
3.00%
|
•
|
Tranche B: At a fixed rate equal to
2.77%
|
•
|
Tranche C: At the 6-month Euro Interbank Offered Rate ("EURIBOR") plus
2.15%
. We entered into interest rate swap agreements in order to hedge our exposure to adverse variable interest rate fluctuations under Tranche C.
|
•
|
The Dublin Senior Loan is a senior obligation of the project company and certain other related subsidiaries, all of which are wholly-owned by us, and is secured by a first priority lien on substantially all of the project-related assets. The Dublin Senior Term Loan is non-recourse to us and our subsidiary Covanta Energy.
|
•
|
The Dublin Senior Loan credit agreement contains positive, negative and financial maintenance covenants that are customary for a project financing of this type. Our ability to service the Dublin Junior Loan and to make cash distributions to common equity is subject to ongoing compliance with these covenants, including maintaining a minimum debt service coverage ratio and loan life coverage ratio on the Dublin Senior Loan.
|
•
|
Final maturity on December 24, 2032 (one month after the maturity of the Dublin Senior Loan).
|
•
|
Scheduled repayments will be made semi-annually according to a 15-year amortization profile, beginning in 2018. The loan is pre-payable at our option subject to potential prepayment costs under Tranche B. The loan shall also be reduced by an incremental amount equal to
10%
of Excess Cashflow, as defined in the credit agreement, on each of the Repayment Dates occurring between October 31, 2026 through April 30, 2029 and
20%
of Excess Cashflow thereafter.
|
•
|
Tranche A borrowings will bear interest at the 6-month Euro Interbank Offered Rate ("EURIBOR") plus
4.50%
|
•
|
Tranche B borrowings will bear interest at a fixed rate equal to
5.358%
.
|
•
|
The Dublin Junior Loan is a junior obligation of the project company and certain other related subsidiaries, all of which are wholly-owned by us, and is secured by a second priority lien on substantially all of the project-related assets and a first priority lien on the assets of the top tier project holding company. The Dublin Junior Loan is non-recourse to us and our subsidiary Covanta Energy.
|
•
|
Under the Dublin Junior Loan credit agreement, our ability to make cash distributions to common equity is subject to ongoing compliance with the covenants under the agreement, including maintaining a minimum debt service coverage ratio on the Dublin Junior Loan.
|
Letters of credit issued under the Revolving Credit Facility
|
|
$
|
239
|
|
Surety bonds
|
|
180
|
|
|
Total other commitments — net
|
|
$
|
419
|
|
|
|
Quarter Ended
|
||||||||||||||||||||||||||||||
|
|
March 31,
|
|
June 30,
|
|
September 30,
|
|
December 31,
|
||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||
Operating revenue
|
|
$
|
458
|
|
|
$
|
404
|
|
|
$
|
454
|
|
|
$
|
424
|
|
|
$
|
456
|
|
|
$
|
429
|
|
|
$
|
500
|
|
|
$
|
495
|
|
Operating income (loss)
|
|
$
|
20
|
|
|
$
|
(23
|
)
|
|
$
|
(18
|
)
|
|
$
|
20
|
|
|
$
|
2
|
|
|
$
|
46
|
|
|
$
|
59
|
|
|
$
|
58
|
|
Net income (loss)
|
|
$
|
201
|
|
|
$
|
(52
|
)
|
|
$
|
(31
|
)
|
|
$
|
(37
|
)
|
|
$
|
(27
|
)
|
|
$
|
15
|
|
|
$
|
9
|
|
|
$
|
131
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Basic
|
|
$
|
1.55
|
|
|
$
|
(0.41
|
)
|
|
$
|
(0.24
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
(0.21
|
)
|
|
$
|
0.11
|
|
|
$
|
0.07
|
|
|
$
|
1.02
|
|
Diluted
|
|
$
|
1.53
|
|
|
$
|
(0.41
|
)
|
|
$
|
(0.24
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
(0.21
|
)
|
|
$
|
0.11
|
|
|
$
|
0.07
|
|
|
$
|
1.01
|
|
|
|
|
|
Additions
|
|
|
|
|
||||||||||||
Description
|
|
Balance
Beginning
of Year
|
|
Charged to
Costs and
Expense
|
|
Charged to
Other
Accounts
|
|
Deductions
|
|
Balance at
End of
Period
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Reserves for doubtful accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended December 31, 2018
|
|
$
|
14
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
8
|
|
Year ended December 31, 2017
|
|
$
|
9
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
14
|
|
Year ended December 31, 2016
|
|
$
|
7
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deferred tax valuation allowance:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended December 31, 2018
|
|
$
|
77
|
|
|
$
|
6
|
|
|
$
|
(4
|
)
|
|
$
|
(6
|
)
|
|
$
|
73
|
|
Year ended December 31, 2017
|
|
$
|
71
|
|
|
$
|
16
|
|
|
$
|
(2
|
)
|
|
$
|
(8
|
)
|
|
$
|
77
|
|
Year ended December 31, 2016
|
|
$
|
73
|
|
|
$
|
9
|
|
|
$
|
(4
|
)
|
|
$
|
(7
|
)
|
|
$
|
71
|
|
|
|
|
/s/ Stephen J. Jones
|
|
Stephen J. Jones
|
|
President and Chief Executive Officer
|
|
|
|
/s/ Bradford J. Helgeson
|
|
Bradford J. Helgeson
|
|
Executive Vice President and Chief Financial Officer
|
(a)
|
Documents filed as part of this report:
|
(1)
|
Consolidated Financial Statements of Covanta Holding Corporation:
|
(2)
|
Financial Statement Schedules of Covanta Holding Corporation:
|
(3)
|
Exhibits:
|
Material Contracts.
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
Other.
|
||
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Labels Linkbase
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Document
|
†
|
Not filed herewith, but incorporated herein by reference.
|
*
|
Management contract or compensatory plan or arrangement.
|
|
(b) Exhibits: See list of Exhibits in this Part IV, Item 15(a)(3) above.
|
|
|
|
|
|
(c) Financial Statement Schedules: See Part IV, Item 15(a)(2) above.
|
|
COVANTA HOLDING CORPORATION
(Registrant)
|
|
|
|
|
|
By:
|
/
S
/ S
TEPHEN
J. J
ONES
|
|
|
Stephen J. Jones
|
|
|
President and Chief Executive Officer
|
Name
|
|
Title
|
|
Date
|
|
|
|
||
/S/
S
TEPHEN J. JONES
|
|
President and Chief Executive Officer and Director (Principal Executive Officer)
|
|
February 19, 2019
|
Stephen J. Jones
|
|
|
||
|
|
|
||
/S/ B
RADFORD
J. H
ELGESON
|
|
Executive Vice President, Chief Financial Officer (Principal Financial Officer)
|
|
February 19, 2019
|
Bradford J. Helgeson
|
|
|
||
|
|
|
||
/S/
M
ANPREET
S. G
REWAL
|
|
Vice President and Chief Accounting Officer (Principal Accounting Officer)
|
|
February 19, 2019
|
Manpreet S. Grewal
|
|
|
||
|
|
|
|
|
/S/ S
AMUEL
Z
ELL
|
|
Chairman of the Board
|
|
February 19, 2019
|
Samuel Zell
|
|
|
||
|
|
|
||
/S/
D
AVID
M. B
ARSE
|
|
Director
|
|
February 19, 2019
|
David M. Barse
|
|
|
||
|
|
|
|
|
/S/
R
ONALD
J. B
ROGLIO
|
|
Director
|
|
February 19, 2019
|
Ronald J. Broglio
|
|
|
||
|
|
|
||
/S/
P
ETER
C. B. B
YNOE
|
|
Director
|
|
February 19, 2019
|
Peter C. B. Bynoe
|
|
|
||
|
|
|
||
/S/
L
INDA
J. F
ISHER
|
|
Director
|
|
February 19, 2019
|
Linda J. Fisher
|
|
|
||
|
|
|
|
|
/S/
J
OSEPH
M. H
OLSTEN
|
|
Director
|
|
February 19, 2019
|
Joseph M. Holsten
|
|
|
||
|
|
|
|
|
/S/ O
WEN
M
ICHAELSON
|
|
Director
|
|
February 19, 2019
|
Owen Michaelson
|
|
|
||
|
|
|
|
|
/S/
D
ANIELLE
P
LETKA
|
|
Director
|
|
February 19, 2019
|
Danielle Pletka
|
|
|
||
|
|
|
|
|
/S/
M
ICHAEL
W. R
ANGER
|
|
Director
|
|
February 19, 2019
|
Michael W. Ranger
|
|
|
||
|
|
|
||
/S/
R
OBERT
S. S
ILBERMAN
|
|
Director
|
|
February 19, 2019
|
Robert S. Silberman
|
|
|
||
|
|
|
|
|
/S/
J
EAN
S
MITH
|
|
Director
|
|
February 19, 2019
|
Jean Smith
|
|
|
||
|
|
|
|
|
TABLE OF CONTENTS
|
|||||
|
|
|
|
Page
|
|
SECTION 1.
|
|
DEFINITIONS; GRANT OF SECURITY
|
|
1
|
|
1.1
|
|
|
General Definitions
.
|
|
1
|
1.2
|
|
|
Definitions; Interpretation.
|
|
7
|
SECTION 2.
|
|
GRANT OF SECURITY
|
|
7
|
|
2.1
|
|
|
Grant of Security
|
|
7
|
2.2
|
|
|
Certain Limited Exclusions
|
|
8
|
SECTION 3.
|
|
SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE.
|
|
8
|
|
3.1
|
|
|
Security for Obligations
.
|
|
8
|
3.2
|
|
|
Continuing Liability Under Collateral
|
|
9
|
SECTION 4.
|
|
REPRESENTATIONS AND WARRANTIES AND COVENANTS
|
|
9
|
|
4.1
|
|
|
Generally
.
|
|
12
|
4.2
|
|
|
Equipment and Inventory
.
|
|
12
|
4.3
|
|
|
Receivables
|
|
12
|
4.4
|
|
|
Investment Property
|
|
14
|
|
|
4.4.1
Investment Property Generally.
|
|
14
|
|
|
|
4.4.2
Pledged Equity Interests
|
|
16
|
|
|
|
4.4.3
Pledged Debt
|
|
17
|
|
4.5
|
|
|
Intellectual Property
|
|
18
|
SECTION 5.
|
|
FURTHER ASSURANCES; ADDITIONAL GRANTORS.
|
|
19
|
|
5.1
|
|
|
Further Assurances
.
|
|
19
|
5.2
|
|
|
Additional Grantors
|
|
20
|
SECTION 6
|
|
COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT.
|
|
21
|
|
6.1
|
|
|
Power of Attorney
|
|
21
|
6.2
|
|
|
No Duty on the Part of Collateral Agent or Secured Parties.
|
|
22
|
SECTION 7
|
|
REMEDIES
|
|
22
|
|
7.1
|
|
|
Generally
|
|
22
|
7.2
|
|
|
Application of Proceeds
|
|
23
|
7.3
|
|
|
Sales on Credit
|
|
24
|
7.4
|
|
|
Investment Property
|
|
24
|
7.5
|
|
|
Intellectual Property
|
|
24
|
7.6
|
|
|
Cash Proceeds
|
|
24
|
SECTION 8.
|
|
COLLATERAL AGENT
|
|
26
|
|
SECTION 9.
|
|
CONTINUING SECURITY INTEREST; TRANSFER OF LOANS.
|
|
26
|
|
SECTION 10.
|
|
STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM
|
|
27
|
|
SECTION 11.
|
|
AMENDMENT AND RESTATEMENT
|
|
27
|
|
SECTION 12.
|
|
MISCELLANEOUS
|
|
28
|
|
|
|
|
|
|
|
|
|||||
|
|||||
|
|
|
|
|
SCHEDULES AND EXHIBITS
|
SCHEDULE 4.1 – GENERAL INFORMATION
|
SCHEDULE 4.2 – LOCATION OF EQUIPMENT AND INVENTORY
|
SCHEDULE 4.4 – INVESTMENT PROPERTY
|
SCHEDULE 4.5 – INTELLECTUAL PROPERTY – EXCEPTIONS
|
|
EXHIBIT A – PLEDGE SUPPLEMENT
|
(a)
|
Accounts;
|
(b)
|
Chattel Paper;
|
(c)
|
Documents;
|
(d)
|
General Intangibles;
|
(e)
|
Goods;
|
(f)
|
Instruments;
|
(g)
|
Insurance;
|
(h)
|
Intellectual Property;
|
(i)
|
Investment Property;
|
(k)
|
to the extent not otherwise included above, all Proceeds, products,
|
4.2
|
Equipment and Inventory
.
|
4.3
|
Receivables
.
|
(i)
|
at the request of the Collateral Agent after the occurrence and during the
|
(ii)
|
other than in the ordinary course of business as generally conducted by it,
|
(iii)
|
except as otherwise provided in this subsection or the Credit Agreement,
|
(iv)
|
subject to any underlying contractual requirements or provisions, it shall
|
(1)
|
except as otherwise provided under the covenants and agreements relating to investment property in this Agreement or elsewhere herein or in the Credit Agreement, each Grantor shall be entitled to exercise or refrain from exercising any and all voting and other consensual rights pertaining to the Investment Property or any part thereof for any purpose not inconsistent with the terms of this Agreement or the Credit Agreement;
|
(2)
|
the Collateral Agent shall promptly execute and deliver (or cause to be executed and delivered) to each Grantor all proxies, and other instruments as such Grantor may from time to time reasonably request for the purpose of enabling such Grantor to exercise the voting and other consensual rights when and to the extent which it is entitled to exercise pursuant to clause (1) above; and
|
(3)
|
upon the occurrence and during the continuation of an Event of Default and upon two (2) Business Days’ prior written notice from the Collateral Agent to such Grantor of the Collateral Agent’s intention to exercise such rights:
|
(A)
|
all rights of each Grantor to exercise the voting and other consensual rights which it would otherwise be entitled to exercise pursuant hereto shall cease and all such rights shall thereupon become vested in the Collateral Agent who shall thereupon have the sole right to exercise such voting and other consensual rights; and
|
(B)
|
in order to permit the Collateral Agent to exercise the voting and other consensual rights which it may be entitled to exercise pursuant hereto and to receive all dividends and other distributions which it may be entitled to receive hereunder: (1) each Grantor shall promptly execute and deliver (or cause the applicable issuer to execute and deliver) to the Collateral Agent all proxies, dividend payment orders and other instruments as the Collateral Agent may from time to time reasonably request and (2) each Grantor acknowledges that the Collateral Agent may utilize the power of attorney set forth in
Section 6.1
.
|
(i)
|
unless otherwise permitted under the Credit Agreement, without the prior
|
(ii)
|
except as expressly permitted by the Credit Agreement, without the prior
|
(iii)
|
each Grantor consents to the grant by each other Grantor of a security
|
(i)
|
file such financing or continuation statements, or amendment thereto, and execute and deliver such other agreements, instruments, endorsements, powers of attorney or notices, as may be necessary or as the Collateral Agent may reasonably request, in order to perfect and preserve the security interests granted hereby;
|
(ii)
|
take all actions necessary to ensure the recordation of appropriate evidence of the liens and security interest granted hereunder in the United States Intellectual Property with any intellectual property registry in which said Intellectual Property is registered or in which an application for registration is pending including, without limitation, the United States Patent and Trademark Office, the United States Copyright Office and the various Secretaries of State;
|
(iii)
|
at any reasonable time following the occurrence and during the continuation of an Event of Default, upon request by the Collateral Agent, assemble the Collateral and allow inspection of the Collateral by the Collateral Agent, or persons designated by the Collateral Agent; and
|
(iv)
|
at the Collateral Agent’s reasonable request, appear in and defend any action or proceeding that may affect such Grantor’s title to or the Collateral Agent’s security interest in all or any part of the Collateral.
|
(a)
|
upon the occurrence and during the continuance of any Event of Default, to
|
(b)
|
upon the occurrence and during the continuance of any Event of Default, to
|
(c)
|
upon the occurrence and during the continuance of any Event of Default, to
|
(d)
|
upon the occurrence and during the continuance of any Event of Default, to
|
(e)
|
to prepare and file any UCC financing statements against such Grantor as
|
(f)
|
to prepare, sign, and file for recordation in any intellectual property registry,
|
(g)
|
upon the occurrence and during the continuance of any Event of Default, to
|
(h)
|
upon the occurrence and during the continuance of any Event of Default,
|
(i)
|
require any Grantor to, and each Grantor hereby agrees that it shall at its
|
(ii)
|
enter onto the property where any Collateral is located and take possession
|
(iii)
|
prior to the disposition of the Collateral, store, process, repair or recondition
|
(iv)
|
without notice except as specified below or under the UCC, sell, assign,
|
(b)
|
The Collateral Agent or any Secured Party may be the purchaser of any or
|
(c)
|
The Collateral Agent may sell the Collateral without giving any warranties
|
(d)
|
The Collateral Agent shall have no obligation to marshal any of the
|
(b)
|
If (i) an Event of Default shall have occurred and, by reason of cure, waiver,
|
(c)
|
Solely for the purpose of enabling the Collateral Agent to exercise rights
|
|
COVANTA ENERGY, LLC, A DELAWARE LIMITED LIABILITY COMPANY, AND EACH OF ITS SUBSIDIARIES LISTED ON
ANNEX A
HERETO
|
|
|
By:
|
/S/ Bradford J. Helgeson
|
|
|
Name: Bradford J. Helgeson
|
|
|
Title: Authorized Officer
|
|
BANK OF AMERICA, N.A.
as Administrative Agent
|
|
|
By:
|
/S/ Ronaldo Naval
|
|
|
Name: Ronaldo Naval
|
|
|
Title: Vice President
|
1.
|
Camden County Energy Recovery Associates, L.P., a New Jersey limited partnership
By its General Partner Covanta Camden GP, LLC and Limited Partner Covanta Energy, LLC
|
2.
|
Covanta 4Recovery Transfer Systems LLC (f/k/a TransRiver Transfer Systems
LLC), a Delaware limited liability company
By its Sole Member Covanta Sustainable Solutions, LLC
|
3.
|
Covanta Abington Transfer Solutions LLC, a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
4.
|
Covanta Alexandria/Arlington, Inc., a Virginia corporation
|
5.
|
Covanta ARC LLC, a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
6.
|
Covanta Bristol, Inc., a Connecticut corporation
|
7.
|
Covanta Camden GP, LLC, a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
8.
|
Covanta Company of SEMASS, LLC (f/k/a Covanta Company of SEMASS, L.P.), a
Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
9.
|
Covanta Dade Metals Recovery LLC, a Florida limited liability company
By its Sole Member Covanta Pasco, Inc.
|
10.
|
Covanta Delaware Valley OP, LLC, a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
11.
|
Covanta Energy Americas, Inc., a Delaware corporation
|
12.
|
Covanta Energy Group, LLC (f/k/a Covanta Energy Group, Inc.), a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
13.
|
Covanta Energy Marketing LLC, a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
14.
|
Covanta Fairfax, Inc., a Virginia corporation
|
15.
|
Covanta Harrisburg, Inc., a Delaware corporation
|
16.
|
Covanta Haverhill, Inc., a Massachusetts corporation
|
17.
|
Covanta Haverhill Associates, LLC (f/k/a Covanta Haverhill Associates), a Massachusetts limited liability company
By its Sole Member Covanta Haverhill, Inc.
|
18.
|
Covanta Hempstead Company, a New York general partnership
By its General Partners Covanta Hempstead II, LLC and Covanta ARC LLC
|
19.
|
Covanta Hempstead II, LLC, a Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
20.
|
Covanta Hillsborough, Inc., a Florida corporation
|
21.
|
Covanta Honolulu Resource Recovery Venture, LLC (f/k/a Covanta Honolulu
Resource Recovery Venture), a Hawaii limited liability company
By its Sole Member Covanta Projects, LLC
|
22.
|
Covanta Huntsville, Inc., an Alabama corporation
|
23.
|
Covanta Indianapolis, Inc., an Indiana corporation
|
24.
|
Covanta Kent, Inc., a Michigan corporation
|
25.
|
Covanta Lake II, Inc., a Florida corporation
|
26.
|
Covanta Lancaster, Inc., a Pennsylvania corporation
|
27.
|
Covanta Lee, Inc., a Florida corporation
|
28.
|
Covanta Long Beach Renewable Energy Corp., a Delaware corporation
|
29.
|
Covanta MacArthur Renewable Energy, Inc., a New York corporation
|
30.
|
Covanta Marion Land Corp., an Oregon corporation
|
31.
|
Covanta Marion, Inc., an Oregon corporation
|
32.
|
Covanta Metals Marketing LLC, a Delaware limited liability company By its Sole Member Covanta Lancaster, Inc.
|
33.
|
Covanta Montgomery, Inc., Maryland corporation
|
34.
|
Covanta Niagara I, LLC (f/k/a Covanta Niagara, L.P.), a Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
35.
|
Covanta Operations of Union, LLC, a New Jersey limited liability company
By its Sole Member Covanta Projects, LLC
|
36.
|
Covanta Pasco, Inc., a Florida corporation
|
37.
|
Covanta Pittsfield, LLC, a New York limited liability company
By its Sole Member and Manager Covanta Projects, LLC
|
38.
|
Covanta Plymouth Renewable Energy, LLC (f/k/a Covanta Plymouth Renewable
Energy Limited Partnership), a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
39.
|
Covanta Power International Holdings, Inc., a Delaware corporation
|
40.
|
Covanta Projects, LLC (f/k/a Covanta Projects, Inc.), a Delaware limited liability company
By its Sole Member Covanta Energy Group, LLC
|
41.
|
Covanta SECONN, LLC, a Delaware limited liability company
By its sole Member Covanta ARC LLC
|
42.
|
Covanta Springfield, LLC, a New York limited liability company
By its Sole Member Covanta Projects, LLC
|
43.
|
Covanta Stanislaus, Inc., a California corporation
|
44.
|
Covanta Sustainable Solutions, LLC (f/k/a Covanta 4Recovery, L.P.), a Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
45.
|
Covanta Tulsa Renewable Energy, LLC (f/k/a Covanta WBH, LLC), a Delaware limited liability company
By its Sole Member Covanta Lancaster, Inc.
|
46.
|
Covanta Warren Energy Resources Co., LLC (f/k/a Covanta Warren Energy
Resources Co., Limited Partnership), a Delaware limited liability company
By its Sole Member Covanta Projects, LLC
|
47.
|
Covanta York Renewable Energy LLC, a Delaware limited liability company By its Sole Member and Manager Covanta Energy, LLC
|
48.
|
ECOvanta, LLC, a Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
49.
|
MSW Energy Finance Co. II, Inc., a Delaware corporation
|
50.
|
Peabody Monofill Associates, Inc., a Massachusetts corporation
|
51.
|
SEMASS Partnership, a Massachusetts limited partnership
By its General Partner and Limited Partner Covanta Company of SEMASS, L.P. and Limited Partner MSW Energy Finance Co. II, Inc.
|
52.
|
Chesapeake Waste Solutions LLC, a Delaware limited liability company
|
53.
|
Covanta Environmental Solutions Carriers II, LLC, a Wisconsin limited liability company
|
54.
|
Advanced Waste Services of Indiana, LLC, a Wisconsin limited liability company
|
55.
|
Waste Recovery Solutions, LLC, a Florida limited liability company
|
56.
|
Environmental Pharmaceuticals, LLC, an Arizona limited liability company
|
57.
|
Industrial Oil Tank Service Corporation, a New York corporation
|
58.
|
GARCO, Inc., a North Carolina corporation
|
59.
|
Covanta Environmental Solutions, LLC, a Delaware limited liability company
|
(A)
|
Full Legal Name, Type of Organization, Jurisdiction of Organization, Chief Executive Office/Sole Place of Business and Organizational Identification Number of each Grantor:
|
Full Legal Name
|
Type of
Organization
|
Jurisdiction of
Organization
|
Chief
Executive
Office
|
Principal Place
of
Business
|
Organization
I.D.#
|
Camden County Energy Recovery Associates, L.P.
|
Limited
Partnership
|
New Jersey
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
600013339
|
Covanta 4Recovery
Transfer Systems LLC
(f/k/a TransRiver
Transfer Systems LLC)
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
3430267
|
Covanta Abington
Transfer Solutions LLC
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
995
Fitzwatertown
Road Abington
PA USA 19001
|
2897347
|
Covanta
Alexandria/Arlington, Inc.
|
Corporation
|
Virginia
|
445 South
Street,
Morristown, NJ
07960
|
5301 Eisenhower
Ave. Alexandria VA USA 22304
|
2610640
|
Covanta ARC LLC
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
3244018
|
Covanta Bristol, Inc.
|
Corporation
|
Connecticut
|
445 South
Street,
Morristown, NJ
07960
|
170 Enterprise
Drive Bristol CT
USA 06010
|
164349
|
Covanta Camden GP, LLC
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
5373195
|
Covanta Company of
SEMASS, LLC (f/k/a
Covanta Company of
SEMASS, L.P.)
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
2572164
|
Covanta Dade Metals Recovery LLC
|
Limited
Liability
Company
|
Florida
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
L11000047148
|
Covanta Delaware Valley OP, LLC
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
2204834
|
Full Legal Name
|
Type of
Organization
|
Jurisdiction of
Organization
|
Chief
Executive
Office
|
Principal Place
of
Business
|
Organization
I.D.#
|
Covanta Honolulu
Resource Recovery
Venture, LLC (f/k/a
Covanta Honolulu
Resource Recovery
Venture)
|
Limited
Liability
Company
|
Hawaii
|
445 South
Street,
Morristown, NJ
07960
|
91-174 Hanua St.
Kapolei HI USA
96707
|
10303 G5
|
Covanta Huntsville, Inc.
|
Corporation
|
Alabama
|
445 South
Street,
Morristown, NJ
07960
|
5251 Triana
Blvd. Huntsville AL USA 35805
|
123‐860
|
Covanta Indianapolis,
Inc.
|
Corporation
|
Indiana
|
445 South
Street,
Morristown, NJ
07960
|
2320 South Harding St.
Indianapolis IN USA 46221
|
198412‐379
|
Covanta Kent, Inc.
|
Corporation
|
Michigan
|
445 South
Street,
Morristown, NJ
07960
|
950 Market Ave. SW Grand
Rapids MI USA
49503
|
800205927
|
Covanta Lake II, Inc.
|
Corporation
|
Florida
|
445 South
Street,
Morristown, NJ
07960
|
3830 Rogers
Industrial Park
Rd. Okahumpka FL USA 34762
|
P04000028902
|
Covanta Lancaster, Inc.
|
Corporation
|
Pennsylvania
|
445 South
Street,
Morristown, NJ
07960
|
1911 River Rd.
Bainbridge PA USA 17502
|
978004
|
Covanta Lee, Inc.
|
Corporation
|
Florida
|
445 South
Street,
Morristown, NJ
07960
|
10500
Buckingham Rd.
Suite 400 Fort
Myers FL USA
33905
|
L53388
|
Covanta Long Beach
Renewable Energy Corp.
|
Corporation
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
118 Pier S
Avenue Long
Beach CA USA
90802
|
2176606
|
Covanta MacArthur
Renewable Energy, Inc.
|
Corporation
|
New York
|
445 South
Street,
Morristown, NJ
07960
|
4001 Veterans
Memorial Hwy
Ronkonkoma NY USA 11779
|
1218696
|
Covanta Marion Land Corp.
|
Corporation
|
Oregon
|
445 South
Street,
Morristown, NJ
07960
|
4850 Brooklake Road, NE P.O.
Box 9126 Brooks OR USA 97305
|
046416-84
|
Covanta Marion, Inc.
|
Corporation
|
Oregon
|
445 South
Street,
|
4850 Brooklake Road, NE P.O.
|
164271-14
|
Full Legal Name
|
Type of
Organization
|
Jurisdiction of
Organization
|
Chief
Executive
Office
|
Principal Place
of
Business
|
Organization
I.D.#
|
|
|
|
Morristown, NJ
07960
|
Box 9126 Brooks OR USA 97305
|
|
Covanta Metals
Marketing LLC
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
5267219
|
Covanta Montgomery,
Inc.
|
Corporation
|
Maryland
|
445 South
Street,
Morristown, NJ
07960
|
21204
Martinburg Rd.
Dickerson MD USA 20842
|
D02905776
|
Covanta Niagara I, LLC
(f/k/a Covanta Niagara,
L.P.)
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
100 Energy Blvd.
@ 56th Street
Niagara Falls NY
USA 14304
|
2325262
|
Covanta Operations of Union, LLC
|
Limited
Liability
Company
|
New Jersey
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
600052953
|
Covanta Pasco, Inc.
|
Corporation
|
Florida
|
445 South
Street,
Morristown, NJ
07960
|
14230 Hays Road
Spring Hill FL USA 34610
|
M67467
|
Covanta Pittsfield, LLC
(f/k/a eco/Pittsfield,
LLC)
|
Limited
Liability
Company
|
New York
|
445 South
Street,
Morristown, NJ
07960
|
500 Hubbard
Ave. Pittsfield
MA USA 01201
|
2850552
|
Covanta Plymouth
Renewable Energy, LLC
(f/k/a Covanta Plymouth
Renewable Energy
Limited Partnership)
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
1155
Conshohocken
Road
Conshohocken
PA USA 19428
|
2267862
|
Covanta Power
International Holdings, Inc.
|
Corporation
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
2460596
|
Covanta Projects, LLC
(f/k/a Covanta Projects,
Inc.)
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
2034649
|
Covanta SECONN LLC
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
2820277
|
Full Legal Name
|
Type of
Organization
|
Jurisdiction of
Organization
|
Chief
Executive
Office
|
Principal Place
of
Business
|
Organization
I.D.#
|
Chesapeake Waste Solutions LLC
|
Limited
Liability
Company
|
Delaware
|
445 South
Street,
Morristown, NJ
07960
|
190 Shellyland road Manheim Pennsylvania USA 17545
|
2954038
|
Covanta Environmental
Solutions Carriers II,
LLC
|
Limited
Liability
Company
|
Wisconsin
|
445 South
Street,
Morristown, NJ
07960
|
3801 West
McKinley Ave
Milwaukee
Wisconsin USA
53208
|
A030838
|
Advanced Waste Services of Indiana, LLC
|
Limited
Liability
Company
|
Wisconsin
|
445 South
Street,
Morristown, NJ
07960
|
445 South Street,
Morristown, NJ
07960
|
A038749
|
Waste Recovery Solutions, LLC
|
Limited
Liability
Company
|
Florida
|
445 South
Street,
Morristown, NJ
07960
|
343 King Street
Myerstown PA USA 17067
|
L15000209300
|
Environmental
Pharmaceuticals, LLC
|
Limited
Liability
Company
|
Arizona
|
445 South
Street,
Morristown, NJ
07960
|
7326 East Evans
Road Suite B
Scottsdale
Arizona USA
85260
|
L-15489436
|
Industrial Oil Tank
Service Corporation
|
Corporation
|
New York
|
445 South
Street,
Morristown, NJ
07960
|
120 Dry Rd.
Oriskany New
York USA 13424
|
833546
|
(B)
|
Changes in Name, Jurisdiction of Organization, Chief Executive Office or Sole Place of Business (or Principal Residence if Grantor is a Natural Person) and Corporate Structure within past one (1) year:
|
(C)
|
Financing Statements:
|
(D)
|
Financing Statements:
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
1.
|
Camden County
Energy Recovery Associates, L.P.
|
New Jersey
|
Limited Partnership
|
1% GP interest owned by Covanta Camden GP,
LLC and 99% LP interest owned by Covanta Energy, LLC
|
2.
|
Covanta 4Recovery
Philadelphia LLC
(f/k/a TransRiver
Philadelphia LLC)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Sustainable Solutions,
LLC
|
3.
|
Covanta 4Recovery
Transfer Systems
LLC (f/k/a
TransRiver Transfer
Systems LLC)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Sustainable Solutions,
LLC
|
4.
|
Covanta Abington
Transfer Solutions
LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
5.
|
Covanta
Alexandria/Arlington, Inc.
|
Virginia
|
Issued: 1,000 shares
|
100% owned by Covanta Projects, LLC
|
6.
|
Covanta ARC LLC
|
Delaware
|
Limited Liability Company
|
100% by Covanta Energy, LLC
|
7.
|
Covanta B-3, LLC
(f/k/a eco/B-3, LLC)
|
New York
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
8.
|
Covanta Babylon, Inc.
|
New York
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
9.
|
Covanta Bristol, Inc.
|
Connecticut
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
10.
|
Covanta Camden GP,
LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
11.
|
Covanta Company of
SEMASS, LLC (f/k/a
Covanta Company of
SEMASS, L.P.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
12.
|
Covanta Connecticut (S.E.), LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta SECONN LLC
|
13.
|
Covanta Dade Metals
Recovery LLC
|
Florida
|
Limited Liability Company
|
100% owned by Covanta Pasco, Inc.
|
14.
|
Covanta Dade
Renewable Energy,
LLC (f/k/a Covanta
Dade Renewable
Energy Ltd.)
|
Florida
|
Limited Liability Company
|
100% owned by Covanta Pasco, Inc.
|
15.
|
Covanta Delano, Inc.
|
Delaware
|
Issued: 1,000 shares
|
100% owned by Covanta Energy Americas, Inc.
|
16.
|
Covanta Delaware
Valley II, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
17.
|
Covanta Delaware Valley OP, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
18.
|
Covanta Delaware Valley, L.P.
|
Delaware
|
Limited Partnership
|
1% owned by Covanta Delaware Valley II, LLC as LP and Covanta ARC LLC owns 50% as GP
interest and 49% as LP interest
|
19.
|
Covanta Energy Americas, Inc.
|
Delaware
|
Issued: 1,000 shares
|
100% owned by Covanta Projects, LLC
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
20.
|
Covanta Energy
Group, LLC (f/k/a
Covanta Energy
Group, Inc.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
21.
|
Covanta Energy
Marketing LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
22.
|
Covanta
Environmental
Solutions, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
23.
|
Covanta Fairfax, Inc.
|
Virginia
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
24.
|
Covanta Harrisburg, Inc.
|
Delaware
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
25.
|
Covanta Haverhill
Associates, LLC
(f/k/a Covanta
Haverhill Associates)
|
Massachusetts
|
Limited Liability Company
|
100% owned by Covanta Haverhill, Inc.
|
26.
|
Covanta Haverhill, Inc.
|
Massachusetts
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
27.
|
Covanta Hempstead
II, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
28.
|
Covanta Hempstead Company
|
New York
|
General
Partnership
|
99% owned by Covanta ARC LLC as GP; 1% owned by Covanta Hempstead II, LLC as GP
|
29.
|
Covanta Hennepin
Energy Resource Co,
LLC (f/k/a Covanta
Hennepin Energy
Resource Co.,
Limited Partnership)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
30.
|
Covanta
Hillsborough, Inc.
|
Florida
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
31.
|
Covanta Honolulu
Resource Recovery
Venture, LLC (f/k/a
Covanta Honolulu
Resource Recovery
Venture)
|
Hawaii
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
32.
|
Covanta Hudson
Valley Renewable
Energy LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
33.
|
Covanta Huntington,
LLC (f/k/a Covanta
Huntington Limited
Partnership)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
34.
|
Covanta Huntsville, Inc.
|
Alabama
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
35.
|
Covanta Hydro
Operations West, Inc.
|
Delaware
|
Issued: 100 shares
|
100% owned
by Covanta Energy Americas, Inc.
|
36.
|
Covanta Indianapolis, Inc.
|
Indiana
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
37.
|
Covanta Kent, Inc.
|
Michigan
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
38.
|
Covanta Lake II, Inc.
|
Florida
|
Issued: 750 shares common
Issued: 250 shares preferred
|
100% Owned by Covanta Projects, LLC
|
39.
|
Covanta Lancaster, Inc.
|
Pennsylvania
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
40.
|
Covanta Lee, Inc.
|
Florida
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
41.
|
Covanta Long Beach
|
Delaware
|
Issued: 100 shares
|
100% owned by Covanta Energy, LLC
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
|
Renewable Energy Corp.
|
|
|
|
42.
|
Covanta MacArthur
Renewable Energy,
Inc.
|
New York
|
Issued: 100 shares
|
100% owned by Covanta Energy, LLC
|
43.
|
Covanta Marion Land Corp.
|
Oregon
|
Issued: 1000 common shares 300 preferred shares
|
100% owned by Covanta Projects, LLC
|
44.
|
Covanta Marion, Inc.
|
Oregon
|
Issued: 10 shares
|
100% owned by Covanta Projects, LLC
|
45.
|
Covanta Mendota,
LLC (f/k/a Covanta
Mendota, L.P.)
|
California
|
Limited Liability Company
|
100% owned by Covanta Energy Americas, Inc.
|
46.
|
Covanta Metals
Marketing LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Lancaster, Inc.
|
47.
|
Covanta
Montgomery, Inc.
|
Maryland
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
48.
|
Covanta Niagara I,
LLC (f/k/a Covanta
Niagara, L.P.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
49.
|
Covanta Onondaga
Two LLC (f/k/a
Covanta Onondaga
Two Corp.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
50.
|
Covanta Operations of Union, LLC
|
New Jersey
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
51.
|
Covanta Pasco, Inc.
|
Florida
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
52.
|
Covanta Pittsfield, LLC (f/k/a eco/Pittsfield, LLC)
|
New York
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
53.
|
Covanta Plymouth
Renewable Energy,
LLC (f/k/a Covanta
Plymouth Renewable
Energy Limited
Partnership)
|
Delaware
|
Limited Liability Company
|
100% ownership by Covanta Energy, LLC
|
54.
|
Covanta Power
International
Holdings, Inc.
|
Delaware
|
Issued: 1,000 shares
|
100% owned by Covanta Energy Americas, Inc.
|
55.
|
Covanta Projects of
Wallingford, LLC
(f/k/a Covanta
Projects of
Wallingford, L.P.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
56.
|
Covanta Projects,
LLC (f/k/a Covanta
Projects, Inc.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy Group, LLC
|
57.
|
Covanta SECONN
LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
58.
|
Covanta SEMASS,
LLC (f/k/a Covanta
SEMASS, L.P.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
59.
|
Covanta Southeastern Connecticut, L.P.
|
Delaware
|
Limited Partnership
|
99% owned by Covanta SECONN LLC and 1% owned by Covanta Connecticut (S.E.), LLC
|
60.
|
Covanta Springfield,
LLC
|
New York
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
61.
|
Covanta Stanislaus, Inc.
|
California
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
62.
|
Covanta Sustainable
Solutions, LLC (f/k/a
Covanta 4Recovery,
L.P.)
|
Delaware
|
Limited Liability
Company
|
100% owned by Covanta ARC LLC
|
63.
|
Covanta Tulsa
Renewable Energy,
LLC (f/k/a Covanta
WBH, LLC)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Lancaster, Inc.
|
64.
|
Covanta Union, LLC
(f/k/a Covanta Union,
Inc.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
65.
|
Covanta Warren
Energy Resources
Co., LLC (f/k/a
Covanta Warren
Energy Resources
Co., Limited
Partnership)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
66.
|
Covanta Waste to
Energy of Italy, Inc.
|
Delaware
|
Issued: 100 shares
|
100% owned by Covanta Power International Holdings, Inc.
|
67.
|
Covanta York
Renewable Energy
LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
68.
|
ECOvanta, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
69.
|
GARCO, Inc.
|
North Carolina
|
Issued: 1,000 shares
|
100% owned by Covanta Environmental
Solutions, LLC
|
70.
|
Koma Kulshan
Associates
|
California
|
Limited Partnership
|
48.99% owned by Covanta Energy Americas, Inc. as LP interest and 1% GP interest and 50% owned by third party
|
71.
|
Mount Kisco
Transfer Station, Inc.
|
New York
|
Issued: 10 shares
|
100% owned by Covanta Sustainable Solutions, LLC
|
72.
|
MSW Energy
Finance Co. II, Inc.
|
Delaware
|
Issued: 3000 shares
|
100% owned by Covanta Energy, LLC
|
73.
|
Peabody Monofill Associates, Inc.
|
Massachusetts
|
Issued: 10,000 shares
|
100% owned by Covanta Projects, LLC
|
74.
|
SEMASS Partnership
|
Massachusetts
|
Limited Partnership
|
98% interest owned by Covanta Company of SEMASS, LLC in LP interest and 1% in GP
interest and 1% owned by MSW Energy Finance Co. II, Inc. as LP interest
|
75.
|
South Fork II
Associates Limited
Partnership
|
Washington
|
Limited Partnership
|
Covanta Energy Americas, Inc. 49.9995% interest as GP and .0005% as LP interest; 50.0095% owned by third party
|
76.
|
Covanta Burnaby
Renewable Energy,
ULC (f/k/a Montenay
Inc.)
|
Canada
|
Issued: 10,500 shares
|
100% owned by Covanta Energy, LLC
|
77.
|
Covanta Energy Asia Pacific Limited
|
Hong Kong
|
Issued: 32 shares each at HK $10.00 par value
|
100% Covanta Power International Holdings, Inc.
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
78.
|
Covanta Energy Philippine Holdings, Inc.
|
Philippines
|
Issued: 52,605 shares at Php 100 par value (Per Philippine law each Covanta director holds 1 share)
|
100%* owned by Covanta
Power International
Holdings, Inc. (*per Philippine law each Covanta director holds 1 share)
|
79.
|
Covanta Ince Park
Limited
|
United Kingdom
|
Issued: 1 share Value: £1
|
100% owned by Covanta Energy Limited
|
80.
|
Covanta Rookery South Limited
|
United Kingdom
|
Issued: 1 share Value: £1
|
100% owned by Covanta Energy Limited
|
81.
|
Edison (Bataan)
Cogeneration
Corporation
|
Philippines
|
Issued: 4,800,000 common stock (Per Philippine law each Covanta director holds 1 share)
|
100%* owned by Covanta
Power International
Holdings, Inc. (*per Philippine law each Covanta director holds 1 share)
|
82.
|
Enereurope Holdings III, B.V.
|
Netherlands
|
Issued: EUR
20,000 and NLG
44,074.20
|
100% owned by Covanta Power International Holdings, Inc.
|
83.
|
Hidro Operaciones Don Pedro S.A.
|
Costa Rica
|
780 shares @ 1,00
|
100% owned by Covanta Power International Holdings, Inc.
|
84.
|
Olmec Insurance Ltd.
|
Bermuda
|
Issued: 1,000,000 common shares have been 50% called and paid totaling $500,000
|
100% owned by Covanta Energy Group, LLC
|
85.
|
TransRiver Canada
Incorporated
|
Canada
|
|
100% owned by Covanta Energy, LLC
|
86.
|
Covanta Burnaby
Renewable Energy,
ULC
|
Canada
|
19,500 Common Shares
|
100% owned by Covanta
Energy, LLC
|
87.
|
Covanta Luxembourg S.A. R.L.
|
Luxembourg
|
Share capital
17,000 shares @ 1
EURO
|
100% owned by Covanta Power International Holdings, Inc.
|
88.
|
Covanta Luxembourg Global Holding S.A. R.L.
|
Luxembourg
|
Share capital
17,000 shares @ 1
EURO
|
100% owned by Covanta Power International Holdings, Inc.
|
89.
|
Covanta Luxembourg Holding S.A. R.L.
|
Luxembourg
|
Share capital
17,000 shares @ 1
EURO
|
100% owned by Covanta Power International Holdings, Inc.
|
90.
|
Covanta Protos
Development Limited
|
United Kingdom
|
1 Ordinary Shares @ £1 each
|
100% owned by Covanta Power International Holdings, Inc.
|
91.
|
Covanta Newhurst
Development Limited
|
United Kingdom
|
2 Ordinary Shares @ £1 each
|
100% owned by Covanta Power International Holdings, Inc.
|
92.
|
Covanta Carribean SRL
|
Barbados
|
1 Common Share @ $1.00
|
100% owned by Covanta Power International Holdings, Inc.
|
93.
|
Chesapeake Waste Solutions LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
94.
|
Covanta
Environmental
Solutions Carriers II,
LLC
|
Wisconsin
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
95.
|
Advanced Waste
Services of Indiana,
|
Wisconsin
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
|
LLC
|
|
|
|
96.
|
Recoil, LLC
|
Pennsylvania
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
97.
|
Waste Recovery
Solutions, LLC
|
Florida
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
98.
|
Environmental
Pharmaceuticals, LLC
|
Arizona
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
99.
|
Industrial Oil Tank
Service Corporation
|
New York
|
Authorized 400
Common Shares
Issued 49 shares voting and 30 shares Class B non-voting
|
100% owned by Covanta Environmental
Solutions, LLC
|
100.
|
Covanta OPW
Associates, Inc.
|
Connecticut
|
100 shares
common @ $1.00
par
|
100% owned by Covanta Projects, LLC
|
101.
|
Covanta Wallingford Associates, Inc.
|
Connecticut
|
100 shares
common @ $1.00
par
|
100% owned by Covanta Projects, LLC
|
(A)
|
CERTIFICATED LLCs/PARTNERSHIP INTERESTS.
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
1.
|
Camden County
Energy Recovery Associates, L.P.
|
New Jersey
|
Limited Partnership
|
1% GP interest owned by Covanta Camden GP,
LLC and 99% LP interest owned by Covanta Energy, LLC
|
2.
|
Covanta 4Recovery
Philadelphia LLC
(f/k/a TransRiver
Philadelphia LLC)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Sustainable Solutions,
LLC
|
3.
|
Covanta 4Recovery
Transfer Systems
LLC (f/k/a
TransRiver Transfer
Systems LLC)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Sustainable Solutions,
LLC
|
4.
|
Covanta Abington
Transfer Solutions
LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
5.
|
Covanta
Alexandria/Arlington, Inc.
|
Virginia
|
Issued: 1,000 shares
|
100% owned by Covanta Projects, LLC
|
6.
|
Covanta ARC LLC
|
Delaware
|
Limited Liability Company
|
100% by Covanta Energy, LLC
|
7.
|
Covanta B-3, LLC
(f/k/a eco/B-3, LLC)
|
New York
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
8.
|
Covanta Babylon, Inc.
|
New York
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
9.
|
Covanta Bristol, Inc.
|
Connecticut
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
10.
|
Covanta Camden GP,
LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
11.
|
Covanta Company of
SEMASS, LLC (f/k/a
Covanta Company of
SEMASS, L.P.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
12.
|
Covanta Connecticut (S.E.), LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta SECONN LLC
|
13.
|
Covanta Dade Metals
Recovery LLC
|
Florida
|
Limited Liability Company
|
100% owned by Covanta Pasco, Inc.
|
14.
|
Covanta Dade
Renewable Energy,
LLC (f/k/a Covanta
Dade Renewable
Energy Ltd.)
|
Florida
|
Limited Liability Company
|
100% owned by Covanta Pasco, Inc.
|
15.
|
Covanta Delano, Inc.
|
Delaware
|
Issued: 1,000 shares
|
100% owned by Covanta Energy Americas, Inc.
|
16.
|
Covanta Delaware
Valley II, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
17.
|
Covanta Delaware Valley OP, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
18.
|
Covanta Delaware Valley, L.P.
|
Delaware
|
Limited Partnership
|
1% owned by Covanta Delaware Valley II, LLC as LP and Covanta ARC LLC owns 50% as GP
interest and 49% as LP interest
|
19.
|
Covanta Energy Americas, Inc.
|
Delaware
|
Issued: 1,000 shares
|
100% owned by Covanta Projects, LLC
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
20.
|
Covanta Energy
Group, LLC (f/k/a
Covanta Energy
Group, Inc.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
21.
|
Covanta Energy
Marketing LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
22.
|
Covanta
Environmental
Solutions, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
23.
|
Covanta Fairfax, Inc.
|
Virginia
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
24.
|
Covanta Harrisburg, Inc.
|
Delaware
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
25.
|
Covanta Haverhill
Associates, LLC
(f/k/a Covanta
Haverhill Associates)
|
Massachusetts
|
Limited Liability Company
|
100% owned by Covanta Haverhill, Inc.
|
26.
|
Covanta Haverhill, Inc.
|
Massachusetts
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
27.
|
Covanta Hempstead
II, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
28.
|
Covanta Hempstead Company
|
New York
|
General
Partnership
|
99% owned by Covanta ARC LLC as GP; 1% owned by Covanta Hempstead II, LLC as GP
|
29.
|
Covanta Hennepin
Energy Resource Co,
LLC (f/k/a Covanta
Hennepin Energy
Resource Co.,
Limited Partnership)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
30.
|
Covanta
Hillsborough, Inc.
|
Florida
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
31.
|
Covanta Honolulu
Resource Recovery
Venture, LLC (f/k/a
Covanta Honolulu
Resource Recovery
Venture)
|
Hawaii
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
32.
|
Covanta Hudson
Valley Renewable
Energy LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
33.
|
Covanta Huntington,
LLC (f/k/a Covanta
Huntington Limited
Partnership)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
34.
|
Covanta Huntsville, Inc.
|
Alabama
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
35.
|
Covanta Hydro
Operations West, Inc.
|
Delaware
|
Issued: 100 shares
|
100% owned
by Covanta Energy Americas, Inc.
|
36.
|
Covanta Indianapolis, Inc.
|
Indiana
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
37.
|
Covanta Kent, Inc.
|
Michigan
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
38.
|
Covanta Lake II, Inc.
|
Florida
|
Issued: 750 shares common
Issued: 250 shares preferred
|
100% Owned by Covanta Projects, LLC
|
39.
|
Covanta Lancaster, Inc.
|
Pennsylvania
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
40.
|
Covanta Lee, Inc.
|
Florida
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
41.
|
Covanta Long Beach
|
Delaware
|
Issued: 100 shares
|
100% owned by Covanta Energy, LLC
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
|
Renewable Energy Corp.
|
|
|
|
42.
|
Covanta MacArthur
Renewable Energy,
Inc.
|
New York
|
Issued: 100 shares
|
100% owned by Covanta Energy, LLC
|
43.
|
Covanta Marion Land Corp.
|
Oregon
|
Issued: 1000 common shares 300 preferred shares
|
100% owned by Covanta Projects, LLC
|
44.
|
Covanta Marion, Inc.
|
Oregon
|
Issued: 10 shares
|
100% owned by Covanta Projects, LLC
|
45.
|
Covanta Mendota,
LLC (f/k/a Covanta
Mendota, L.P.)
|
California
|
Limited Liability Company
|
100% owned by Covanta Energy Americas, Inc.
|
46.
|
Covanta Metals
Marketing LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Lancaster, Inc.
|
47.
|
Covanta
Montgomery, Inc.
|
Maryland
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
48.
|
Covanta Niagara I,
LLC (f/k/a Covanta
Niagara, L.P.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
49.
|
Covanta Onondaga
Two LLC (f/k/a
Covanta Onondaga
Two Corp.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
50.
|
Covanta Operations of Union, LLC
|
New Jersey
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
51.
|
Covanta Pasco, Inc.
|
Florida
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
52.
|
Covanta Pittsfield, LLC (f/k/a eco/Pittsfield, LLC)
|
New York
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
53.
|
Covanta Plymouth
Renewable Energy,
LLC (f/k/a Covanta
Plymouth Renewable
Energy Limited
Partnership)
|
Delaware
|
Limited Liability Company
|
100% ownership by Covanta Energy, LLC
|
54.
|
Covanta Power
International
Holdings, Inc.
|
Delaware
|
Issued: 1,000 shares
|
100% owned by Covanta Energy Americas, Inc.
|
55.
|
Covanta Projects of
Wallingford, LLC
(f/k/a Covanta
Projects of
Wallingford, L.P.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
56.
|
Covanta Projects,
LLC (f/k/a Covanta
Projects, Inc.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy Group, LLC
|
57.
|
Covanta SECONN
LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
58.
|
Covanta SEMASS,
LLC (f/k/a Covanta
SEMASS, L.P.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
59.
|
Covanta Southeastern Connecticut, L.P.
|
Delaware
|
Limited Partnership
|
99% owned by Covanta SECONN LLC and 1% owned by Covanta Connecticut (S.E.), LLC
|
60.
|
Covanta Springfield,
LLC
|
New York
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
61.
|
Covanta Stanislaus, Inc.
|
California
|
Issued: 100 shares
|
100% owned by Covanta Projects, LLC
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
62.
|
Covanta Sustainable
Solutions, LLC (f/k/a
Covanta 4Recovery,
L.P.)
|
Delaware
|
Limited Liability
Company
|
100% owned by Covanta ARC LLC
|
63.
|
Covanta Tulsa
Renewable Energy,
LLC (f/k/a Covanta
WBH, LLC)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Lancaster, Inc.
|
64.
|
Covanta Union, LLC
(f/k/a Covanta Union,
Inc.)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
65.
|
Covanta Warren
Energy Resources
Co., LLC (f/k/a
Covanta Warren
Energy Resources
Co., Limited
Partnership)
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Projects, LLC
|
66.
|
Covanta Waste to
Energy of Italy, Inc.
|
Delaware
|
Issued: 100 shares
|
100% owned by Covanta Power International Holdings, Inc.
|
67.
|
Covanta York
Renewable Energy
LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Energy, LLC
|
68.
|
ECOvanta, LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta ARC LLC
|
69.
|
GARCO, Inc.
|
North Carolina
|
Issued: 1,000 shares
|
100% owned by Covanta Environmental
Solutions, LLC
|
70.
|
Koma Kulshan
Associates
|
California
|
Limited Partnership
|
48.99% owned by Covanta Energy Americas, Inc. as LP interest and 1% GP interest and 50% owned by third party
|
71.
|
Mount Kisco
Transfer Station, Inc.
|
New York
|
Issued: 10 shares
|
100% owned by Covanta Sustainable Solutions, LLC
|
72.
|
MSW Energy
Finance Co. II, Inc.
|
Delaware
|
Issued: 3000 shares
|
100% owned by Covanta Energy, LLC
|
73.
|
Peabody Monofill Associates, Inc.
|
Massachusetts
|
Issued: 10,000 shares
|
100% owned by Covanta Projects, LLC
|
74.
|
SEMASS Partnership
|
Massachusetts
|
Limited Partnership
|
98% interest owned by Covanta Company of SEMASS, LLC in LP interest and 1% in GP
interest and 1% owned by MSW Energy Finance Co. II, Inc. as LP interest
|
75.
|
South Fork II
Associates Limited
Partnership
|
Washington
|
Limited Partnership
|
Covanta Energy Americas, Inc. 49.9995% interest as GP and .0005% as LP interest; 50.0095% owned by third party
|
76.
|
Covanta Burnaby
Renewable Energy,
ULC (f/k/a Montenay
Inc.)
|
Canada
|
Issued: 10,500 shares
|
100% owned by Covanta Energy, LLC
|
77.
|
Covanta Energy Asia Pacific Limited
|
Hong Kong
|
Issued: 32 shares each at HK $10.00 par value
|
100% Covanta Power International Holdings, Inc.
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
78.
|
Covanta Energy Philippine Holdings, Inc.
|
Philippines
|
Issued: 52,605 shares at Php 100 par value (Per Philippine law each Covanta director holds 1 share)
|
100%* owned by Covanta
Power International
Holdings, Inc. (*per Philippine law each Covanta director holds 1 share)
|
79.
|
Covanta Ince Park
Limited
|
United Kingdom
|
Issued: 1 share Value: £1
|
100% owned by Covanta Energy Limited
|
80.
|
Covanta Rookery South Limited
|
United Kingdom
|
Issued: 1 share Value: £1
|
100% owned by Covanta Energy Limited
|
81.
|
Edison (Bataan)
Cogeneration
Corporation
|
Philippines
|
Issued: 4,800,000 common stock (Per Philippine law each Covanta director holds 1 share)
|
100%* owned by Covanta
Power International
Holdings, Inc. (*per Philippine law each Covanta director holds 1 share)
|
82.
|
Enereurope Holdings III, B.V.
|
Netherlands
|
Issued: EUR
20,000 and NLG
44,074.20
|
100% owned by Covanta Power International Holdings, Inc.
|
83.
|
Hidro Operaciones Don Pedro S.A.
|
Costa Rica
|
780 shares @ 1,00
|
100% owned by Covanta Power International Holdings, Inc.
|
84.
|
Olmec Insurance Ltd.
|
Bermuda
|
Issued: 1,000,000 common shares have been 50% called and paid totaling $500,000
|
100% owned by Covanta Energy Group, LLC
|
85.
|
TransRiver Canada
Incorporated
|
Canada
|
|
100% owned by Covanta Energy, LLC
|
86.
|
Covanta Burnaby
Renewable Energy,
ULC
|
Canada
|
19,500 Common Shares
|
100% owned by Covanta
Energy, LLC
|
87.
|
Covanta Luxembourg S.A. R.L.
|
Luxembourg
|
Share capital
17,000 shares @ 1
EURO
|
100% owned by Covanta Power International Holdings, Inc.
|
88.
|
Covanta Luxembourg Global Holding S.A. R.L.
|
Luxembourg
|
Share capital
17,000 shares @ 1
EURO
|
100% owned by Covanta Power International Holdings, Inc.
|
89.
|
Covanta Luxembourg Holding S.A. R.L.
|
Luxembourg
|
Share capital
17,000 shares @ 1
EURO
|
100% owned by Covanta Power International Holdings, Inc.
|
90.
|
Covanta Protos
Development Limited
|
United Kingdom
|
1 Ordinary Shares @ £1 each
|
100% owned by Covanta Power International Holdings, Inc.
|
91.
|
Covanta Newhurst
Development Limited
|
United Kingdom
|
2 Ordinary Shares @ £1 each
|
100% owned by Covanta Power International Holdings, Inc.
|
92.
|
Covanta Carribean SRL
|
Barbados
|
1 Common Share @ $1.00
|
100% owned by Covanta Power International Holdings, Inc.
|
93.
|
Chesapeake Waste Solutions LLC
|
Delaware
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
94.
|
Covanta
Environmental
Solutions Carriers II,
LLC
|
Wisconsin
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
95.
|
Advanced Waste
Services of Indiana, LLC
|
Wisconsin
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
|
Company Name
|
Jurisdiction of Incorporation
|
Capital Stock or Equity Interests
|
Description of Anticipated Ownership As of the Closing Date
|
96.
|
Recoil, LLC
|
Pennsylvania
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
97.
|
Waste Recovery
Solutions, LLC
|
Florida
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
98.
|
Environmental
Pharmaceuticals, LLC
|
Arizona
|
Limited Liability Company
|
100% owned by Covanta Environmental
Solutions, LLC
|
99.
|
Industrial Oil Tank
Service Corporation
|
New York
|
Authorized 400
Common Shares
Issued 49 shares voting and 30 shares Class B non-voting
|
100% owned by Covanta Environmental
Solutions, LLC
|
100.
|
Covanta OPW
Associates, Inc.
|
Connecticut
|
100 shares
common @ $1.00
par
|
100% owned by Covanta Projects, LLC
|
101.
|
Covanta Wallingford Associates, Inc.
|
Connecticut
|
100 shares
common @ $1.00
par
|
100% owned by Covanta Projects, LLC
|
(B)
|
CERTIFICATED LLCs/PARTNERSHIP INTERESTS.
|
(A)
|
Copyrights
|
Copyright
|
Registration Number
|
Issue Date (Filing Date)
|
Garco dealer catalog: motorcycle parts & accessories
|
TX0000058924
|
3/16/78
|
(B)
|
Copyright Licenses
|
(C)
|
Patents
|
Patent
|
Patent Number (Application Number)
|
Issue Date (Filing Date)
|
Expanded Size Sludge Vacuum Tanker
|
8,328,290
|
12/11/12
|
Patent
|
Patent Number (Application Number)
|
Issue Date (Filing Date)
|
Dynamic Control of SNCR
System for Semi-Batch Fed
Stoker Based on MSW Combustion
|
7,712,306
|
5/11/10
|
Method for Supplying
Combustion Gas in
Incineration Systems
|
7,975,628
|
7/12/11
|
Tertiary Air Addition to Solid
Waste-Fired Furnaces for NOx Control
|
8,443,739
|
05/21/13
|
Gasification Combustion System
|
8,707,875
|
04/29/14
|
Gasification Combustion System
|
8,701,573
|
04/22/14
|
Gasification Combustion System
|
8,997,664
|
4/7/15
|
Aerodynamic Tube Shields
|
(14/757,495)
|
(12/23/15)
|
System and Method for
Automatic Control of
Differential Pressure in a
Baghouse System
|
9,782,711
|
10/10/17
|
Patent
|
Patent Number (Application Number)
|
Issue Date (Filing Date)
|
Method To Improve The
Characteristics Of Ash From
Municipal Solid Waste Combustors
|
7,682,446
|
March 23, 2010
|
(D)
|
Patent Licenses
|
(E)
|
Trademarks
|
Country
|
Mark
|
Registration Number (Application Number)
|
Registration Date (Filing Date)
|
USA
|
VACSIMIZER
|
AN: 77/826,201
RN: 3,780,873
|
(2/9/10)
4/27/10
|
Country
|
Mark
|
Registration Number (Application Number)
|
Registration Date (Filing Date)
|
USA
|
COVANTA
|
AN: 77/054,918
RN: 3,451,902
|
(12/1/06)
6/24/08
|
USA
|
4RECOVERY
|
AN: 85/417,332
RN: 4,211,745
|
(9/8/11)
6/20/12
|
USA
|
Bolt (Design)
|
AN: 85/417,331
RN: 4,339,412
|
(9/8/11)
5/21/13
|
USA
|
COVANTA 4RECOVERY
|
AN: 85/417,335
RN: 4,339,413
|
(9/8/11)
5/21/13
|
USA
|
ECOVANTA
|
AN: 85/183,842
RN: 4,032,755
|
(11/23/10)
9/27/11
|
USA
|
REF-FUEL
|
AN: 73/835,929
RN: 1,602,911
|
(11/3/89)
6/19/90
|
USA
|
REF FUEL
|
AN: 85/286,283
RN: 4,172,649
|
(4/5/11)
7/10/12
|
USA
|
REF FUEL Logo (Design)
|
AN: 85/286,300
RN: 4,176,687
|
(4/5/11)
7/17/12
|
USA
|
RX4SAFETY
|
AN: 85/293,670
RN: 4,062,821
|
(4/13/11)
11/29/11
|
(F)
|
Trademark Licenses
|
(G)
|
Trade Secret Licenses
|
(H)
|
Exceptions to Representations and Warranties in Section 4.5
|
|
COVANTA ENERGY, LLC, A DELAWARE LIMITED LIABILITY COMPANY, AND EACH OF ITS SUBSIDIARIES LISTED ON
ANNEX A
HERETO
|
|
|
By:
|
/S/ Bradford J. Helgeson
|
|
|
Name: Bradford J. Helgeson
|
|
|
Title: Authorized Officer
|
|
COVANTA HOLDING CORPORATION, A DELAWARE CORPORATION
|
|
|
By:
|
/S/ Bradford J. Helgeson
|
|
|
Name: Bradford J. Helgeson
|
|
|
Title: Executive Vice President and Chief Financial Officer
|
|
BANK OF AMERICA, N.A.
as Administrative Agent
|
|
|
By:
|
/S/ Ronaldo Naval
|
|
|
Name: Ronaldo Naval
|
|
|
Title: Vice President
|
1.
|
Camden County Energy Recovery Associates, L.P., a New Jersey limited partnership
By its General Partner Covanta Camden GP, LLC and Limited Partner Covanta Energy, LLC
|
2.
|
Covanta 4Recovery Transfer Systems LLC (f/k/a TransRiver Transfer Systems
LLC), a Delaware limited liability company
By its Sole Member Covanta Sustainable Solutions, LLC
|
3.
|
Covanta Abington Transfer Solutions LLC, a Delaware limited liability company By its Sole Member Covanta Energy, LLC
|
4.
|
Covanta Alexandria/Arlington, Inc., a Virginia corporation
|
5.
|
Covanta ARC LLC, a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
6.
|
Covanta Bristol, Inc., a Connecticut corporation
|
7.
|
Covanta Camden GP, LLC, a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
8.
|
Covanta Company of SEMASS, LLC (f/k/a Covanta Company of SEMASS, L.P.), a
Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
9.
|
Covanta Dade Metals Recovery LLC, a Florida limited liability company By its Sole Member Covanta Pasco, Inc.
|
10.
|
Covanta Delaware Valley OP, LLC, a Delaware limited liability company By its Sole Member Covanta Energy, LLC
|
11.
|
Covanta Energy Americas, Inc., a Delaware corporation
|
12.
|
Covanta Energy Group, LLC (f/k/a Covanta Energy Group, Inc.), a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
13.
|
Covanta Energy Marketing LLC, a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
14.
|
Covanta Fairfax, Inc., a Virginia corporation
|
15.
|
Covanta Harrisburg, Inc., a Delaware corporation
|
16.
|
Covanta Haverhill, Inc., a Massachusetts corporation
|
17.
|
Covanta Haverhill Associates, LLC (f/k/a Covanta Haverhill Associates), a Massachusetts limited liability company
By its Sole Member Covanta Haverhill, Inc.
|
18.
|
Covanta Hempstead Company, a New York general partnership
By its General Partners Covanta Hempstead II, LLC and Covanta ARC LLC
|
19.
|
Covanta Hempstead II, LLC, a Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
20.
|
Covanta Hillsborough, Inc., a Florida corporation
|
21.
|
Covanta Honolulu Resource Recovery Venture, LLC (f/k/a Covanta Honolulu Resource Recovery Venture), a Hawaii limited liability company
|
|
By its Sole Member Covanta Projects, LLC
|
22.
|
Covanta Huntsville, Inc., an Alabama corporation
|
23.
|
Covanta Indianapolis, Inc., an Indiana corporation
|
24.
|
Covanta Kent, Inc., a Michigan corporation
|
25.
|
Covanta Lake II, Inc., a Florida corporation
|
26.
|
Covanta Lancaster, Inc., a Pennsylvania corporation
|
27.
|
Covanta Lee, Inc., a Florida corporation
|
28.
|
Covanta Long Beach Renewable Energy Corp., a Delaware corporation
|
29.
|
Covanta MacArthur Renewable Energy, Inc., a New York corporation
|
30.
|
Covanta Marion Land Corp., an Oregon corporation
|
31.
|
Covanta Marion, Inc., an Oregon corporation
|
32.
|
Covanta Metals Marketing LLC, a Delaware limited liability company
By its Sole Member Covanta Lancaster, Inc.
|
33.
|
Covanta Montgomery, Inc., Maryland corporation
|
34.
|
Covanta Niagara I, LLC (f/k/a Covanta Niagara, L.P.), a Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
35.
|
Covanta Operations of Union, LLC, a New Jersey limited liability company
By its Sole Member Covanta Projects, LLC
|
36.
|
Covanta Pasco, Inc., a Florida corporation
|
37.
|
Covanta Pittsfield, LLC, a New York limited liability company
By its Sole Member and Manager Covanta Projects, LLC
|
38.
|
Covanta Plymouth Renewable Energy, LLC (f/k/a Covanta Plymouth Renewable
Energy Limited Partnership), a Delaware limited liability company
By its Sole Member Covanta Energy, LLC
|
39.
|
Covanta Power International Holdings, Inc., a Delaware corporation
|
40.
|
Covanta Projects, LLC (f/k/a Covanta Projects, Inc.), a Delaware limited liability company
By its Sole Member Covanta Energy Group, LLC
|
41.
|
Covanta SECONN LLC, a Delaware limited liability company By its sole Member Covanta ARC LLC
|
42.
|
Covanta Springfield, LLC, a New York limited liability company By its Sole Member Covanta Projects, LLC
|
43.
|
Covanta Stanislaus, Inc., a California corporation
|
44.
|
Covanta Sustainable Solutions, LLC (f/k/a Covanta 4Recovery, L.P.), a Delaware limited liability company
By its Sole Member Covanta ARC LLC
|
45.
|
Covanta Tulsa Renewable Energy, LLC (f/k/a Covanta WBH, LLC), a Delaware limited liability company
By its Sole Member Covanta Lancaster, Inc.
|
46.
|
Covanta Warren Energy Resources Co., LLC (f/k/a Covanta Warren Energy
Resources Co., Limited Partnership), a Delaware limited liability company
By its Sole Member Covanta Projects, LLC
|
47.
|
Covanta York Renewable Energy LLC, a Delaware limited liability company By its Sole Member and Manager Covanta Energy, LLC
|
48.
|
ECOvanta, LLC, a Delaware limited liability company By its Sole Member Covanta ARC LLC
|
49.
|
MSW Energy Finance Co. II, Inc., a Delaware corporation
|
50.
|
Peabody Monofill Associates, Inc., a Massachusetts corporation
|
51.
|
SEMASS Partnership, a Massachusetts limited partnership
By its General Partner and Limited Partner Covanta Company of SEMASS, L.P. and Limited Partner MSW Energy Finance Co. II, Inc.
|
52.
|
Chesapeake Waste Solutions LLC, a Delaware limited liability company
|
53.
|
Covanta Environmental Solutions Carriers II, LLC, a Wisconsin limited liability company
|
54.
|
Advanced Waste Services of Indiana, LLC, a Wisconsin limited liability company
|
55.
|
Waste Recovery Solutions, LLC, a Florida limited liability company
|
56.
|
Environmental Pharmaceuticals, LLC, an Arizona limited liability company
|
57.
|
Industrial Oil Tank Service Corporation, a New York corporation
|
58.
|
GARCO, Inc., a North Carolina corporation
|
59.
|
Covanta Environmental Solutions, LLC, a Delaware limited liability company
|
1.
|
Covanta Babylon, Inc., a New York corporation
|
2.
|
Covanta Connecticut (S.E.), LLC, a Delaware limited liability company
|
3.
|
Covanta Dade Renewable Energy, LLC (f/k/a Covanta Dade Renewable Energy Ltd.), a Florida limited liability company
|
4.
|
Covanta Delano, Inc., a Delaware corporation
|
5.
|
Covanta Delaware Valley II, LLC, a Delaware limited liability company
|
6.
|
Covanta Delaware Valley, L.P., a Delaware limited partnership
|
7.
|
Covanta Essex Company, a New Jersey corporation
|
8.
|
Covanta Essex LLC, a Delaware limited liability company
|
9.
|
Covanta Essex II, LLC, a Delaware limited liability company
|
10.
|
Covanta Huntington, LLC (f/k/a Covanta Huntington Limited Partnership), a Delaware limited liability company
|
11.
|
Covanta Hydro Operations West, Inc., a Delaware corporation
|
12.
|
Covanta Mendota, LLC (f/k/a Covanta Mendota, L.P.), a California limited liability company
|
13.
|
Covanta Onondaga Limited Partnership, a Delaware limited partnership
|
14.
|
Covanta Onondaga Two LLC (f/k/a Covanta Onondaga Two Corp.), a Delaware limited liability company
|
15.
|
Covanta Southeastern Connecticut Company, a Connecticut corporation
|
16.
|
Covanta Southeastern Connecticut, L.P., a Delaware limited partnership
|
17.
|
Covanta Union, LLC (f/k/a Covanta Union, Inc.), a Delaware limited liability company
|
18.
|
Koma Kulshan Associates LP, a California limited partnership
|
19.
|
South Fork II Associates Limited Partnership, a Washington limited partnership
|
20.
|
Covanta Burnaby Renewable Energy, Inc., Canada
|
21.
|
Covanta Durham York Renewable Energy Limited Partnership, Canada
|
22.
|
Covanta Energy (Ireland) Limited, Ireland
|
23.
|
Covanta Energy Asia Holdings Ltd., Mauritius
|
24.
|
Covanta Energy Asia Pacific Holdings, Ltd., China
|
25.
|
Covanta Energy Asia Pacific Ltd., Hong Kong
|
26.
|
Covanta Energy China (Delta) Ltd., Mauritius
|
27.
|
Covanta Energy China (Gamma) Ltd., Mauritius
|
28.
|
Covanta Energy India (Balaji) Limited, Mauritius
|
29.
|
Covanta Energy International Investments Limited (f/k/a Covanta Energy India Investments, Ltd.), Mauritius
|
30.
|
Covanta Energy Limited, United Kingdom
|
31.
|
Covanta Energy Philippines Holdings, Inc., Philippines
|
32.
|
Covanta Europe Engineering Limited, Ireland
|
33.
|
Covanta Europe Holdings S.a.r.l., Luxembourg
|
34.
|
Covanta Europe Operations Limited, Ireland
|
35.
|
Covanta Five Ltd., Mauritius
|
36.
|
Covanta Holding UK Limited, United Kingdom
|
37.
|
Covanta Ince Park LLP, United Kingdom
|
38.
|
Covanta Rookery South Ltd., United Kingdom
|
39.
|
Covanta Waste to Energy Asia Limited, Hong Kong
|
40.
|
Covanta Waste to Energy Asia Ltd., Mauritius
|
41.
|
Dublin Waste to Energy Group (Holdings) Limited, Ireland
|
42.
|
Dublin Waste to Energy (Holdings) Limited, Ireland
|
43.
|
Dublin Waste to Energy Supply Limited, Ireland
|
44.
|
Dublin Waste to Energy Limited, Ireland
|
45.
|
Edison (Bataan) Cogeneration Corporation, Philippines
|
46.
|
Enereurope Holdings III, B.V., Netherlands
|
47.
|
Hidro Operaciones Don Pedro S.A., Costa Rica
|
48.
|
Olmec Insurance Ltd., Bermuda
|
49.
|
TransRiver Canada Incorporated, Canada
|
50.
|
Covanta Environmental Solutions, Inc., Canada
|
51.
|
Covanta Environmental Solutions Ontario, Inc., Canada
|
52.
|
Return-Tech Inc., Canada
|
53.
|
35 Industrial Inc., Canada
|
54.
|
Covanta Burnaby Renewable Energy, ULC, Canada
|
55.
|
Covanta Luxembourg S.A. R.L., Luxembourg
|
56.
|
Covanta Luxembourg Global Holding S.A. R.L., Luxembourg
|
57.
|
Covanta Luxembourg Holding S.A. R.L., Luxembourg
|
58.
|
Covanta Holding 2 UK Limited, United Kingdom
|
59.
|
Covanta Holding 3 UK Limited, United Kingdom
|
60.
|
Covanta Europe Assets Limited, United Kingdom
|
61.
|
Covanta Protos Development Limited, United Kingdom
|
62.
|
Covanta Newhurst Development Limited, United Kingdom
|
63.
|
Covanta Caribbean SRL, Barbados
|
Company Name
|
|
Jurisdiction of
Incorporation
|
35 Industrial, Inc.
|
|
Canada
|
Advanced Waste Services of Indiana, LLC
|
|
Wisconsin
|
Camden County Energy Recovery Associates, L.P.
|
|
New Jersey
|
Chesapeake Waste Solutions, Inc.
|
|
Delaware
|
Covanta 4Recovery Philadelphia LLC
|
|
Delaware
|
Covanta 4Recovery Transfer Systems LLC
|
|
Delaware
|
Covanta Abington Transfer Solutions LLC
|
|
Delaware
|
Covanta Alexandria / Arlington, Inc.
|
|
Virginia
|
Covanta ARC LLC
|
|
Delaware
|
Covanta B-3, LLC
|
|
New York
|
Covanta Babylon, Inc.
|
|
New York
|
Covanta Bristol, Inc.
|
|
Connecticut
|
Covanta Burnaby Renewable Energy , ULC
|
|
Canada
|
Covanta Camden GP, LLC
|
|
Delaware
|
Covanta Caribbean SRL
|
|
Barbados
|
Covanta Company of SEMASS, LLC
|
|
Delaware
|
Covanta Connecticut (S.E.), LLC
|
|
Delaware
|
Covanta Corporation
|
|
Delaware
|
Covanta Dade Metals Recovery LLC
|
|
Florida
|
Covanta Dade Renewable Energy, LLC
|
|
Florida
|
Covanta Delano, Inc.
|
|
Delaware
|
Covanta Delaware Valley II, LLC
|
|
Delaware
|
Covanta Delaware Valley, L.P.
|
|
Delaware
|
Covanta Delaware Valley OP, LLC
|
|
Delaware
|
Covanta Durhan York Renewable Energy Limited Partnership
|
|
Canada
|
Covanta Energy (Ireland) Limited
|
|
Ireland
|
Covanta Energy Americas, Inc.
|
|
Delaware
|
Covanta Energy Asia Holdings Ltd.
|
|
Mauritius
|
Covanta Energy Asia Pacific Holdings Ltd.
|
|
People's Republic of China
|
Covanta Energy China (Delta) Limited
|
|
Republic of Mauritius
|
Covanta Energy China (Gamma) Limited
|
|
Republic of Mauritius
|
Covanta Energy Group, LLC
|
|
Delaware
|
Covanta Energy India (Balaji) Limited
|
|
Republic of Mauritius
|
Covanta Energy International Investments Limited
|
|
Republic of Mauritius
|
Covanta Energy Limited
|
|
United Kingdom
|
Covanta Energy, LLC
|
|
Delaware
|
Covanta Energy Marketing LLC
|
|
Delaware
|
Covanta Environmental Solutions, Inc. f/k/a Sorinco, Inc.
|
|
Canada
|
Covanta Environmental Solutions, LLC
|
|
Delaware
|
Covanta Environmental Solutions Carriers II, LLC
|
|
Wisconsin
|
Covanta Environmental Solutions Ontario, Inc. f/k/a Quantex Environmental Inc.
|
|
Canada
|
Covanta Energy Philippine Holdings, Inc.
|
|
Philippines
|
Covanta Essex Company
|
|
New Jersey
|
Covanta Essex II, LLC
|
|
Delaware
|
Covanta Essex LLC
|
|
Delaware
|
Covanta Europe Assets Limited
|
|
United Kingdom
|
Covanta Europe Engineering Limited
|
|
Ireland
|
Covanta Europe Holdings S.a.r.l.
|
|
Luxembourg
|
Covanta Europe Operations Limited
|
|
Ireland
|
Covanta Fairfax, Inc.
|
|
Virginia
|
Covanta Five Limited
|
|
Republic of Mauritius
|
Covanta Green Earls Gate Holding Limited
|
|
Jersey
|
Covanta Green Jersey Assets Limited
|
|
Jersey
|
Covanta Green UK Limited
|
|
United Kingdom
|
Covanta Green Rookery Holding Limited
|
|
United Kingdom
|
Covanta Harrisburg, Inc.
|
|
Delaware
|
Covanta Haverhill Associates, LLC
|
|
Massachusetts
|
Covanta Haverhill, Inc.
|
|
Massachusetts
|
Covanta Hempstead Company
|
|
New York
|
Covanta Hempstead II, LLC
|
|
Delaware
|
Covanta Hennepin Energy Resource Co, LLC
|
|
Delaware
|
Covanta Hillsborough, Inc.
|
|
Florida
|
Covanta Holding UK Limited
|
|
United Kingdom
|
Covanta Holding 2 UK Limited
|
|
United Kingdom
|
Covanta Holding 3 UK Limited
|
|
United Kingdom
|
Covanta Honolulu Resource Recovery Venture, LLC
|
|
Hawaii
|
Covanta Hudson Valley Renewable Energy LLC
|
|
Delaware
|
Covanta Huntington, LLC
|
|
Delaware
|
Covanta Huntsville, Inc.
|
|
Alabama
|
Covanta Hydro Operations West, Inc.
|
|
Delaware
|
Covanta Ince Park Limited
|
|
United Kingdom
|
Covanta Indianapolis, Inc.
|
|
Indiana
|
Covanta Insurance Holdings, LLC
|
|
Delaware
|
Covanta Kent, Inc.
|
|
Michigan
|
Covanta Lake II, Inc.
|
|
Florida
|
Covanta Lancaster, Inc.
|
|
Pennsylvania
|
Covanta Lee, Inc.
|
|
Florida
|
Covanta Long Beach Renewable Energy Corp.
|
|
Delaware
|
Covanta MacArthur Renewable Energy, Inc.
|
|
New York
|
Covanta Marion Land Corp.
|
|
Oregon
|
Covanta Marion, Inc.
|
|
Oregon
|
Covanta Mendota, LLC
|
|
California
|
Covanta Metals Marketing LLC
|
|
Delaware
|
Covanta Montgomery, Inc.
|
|
Maryland
|
Covanta Niagara I, LLC
|
|
Delaware
|
Covanta Newhurst Development Limited
|
|
United Kingdom
|
Covanta Onondaga Limited Partnership
|
|
Delaware
|
Covanta Onondaga Two LLC
|
|
Delaware
|
Covanta Operations of Union LLC
|
|
New Jersey
|
Covanta OPW Associates, Inc.
|
|
Connecticut
|
Covanta Palm Beach Resource Recovery LLC
|
|
Florida
|
Covanta Pasco, Inc.
|
|
Florida
|
Covanta Pittsfield, LLC
|
|
New York
|
Covanta Plymouth Renewable Energy, LLC
|
|
Delaware
|
Covanta Power International Holdings, Inc.
|
|
Delaware
|
Covanta Projects of Wallingford, LLC
|
|
Delaware
|
Covanta Projects, LLC
|
|
Delaware
|
Covanta Protos Development Limited
|
|
United Kingdom
|
Covanta SECONN LLC
|
|
Delaware
|
Covanta Southeastern Connecticut Company
|
|
Connecticut
|
Covanta Southeastern Connecticut, L.P.
|
|
Delaware
|
Covanta Springfield, LLC
|
|
New York
|
Covanta Stanislaus, Inc.
|
|
California
|
Covanta Sustainable Solutions, LLC
|
|
Delaware
|
Covanta TARTECH LLC
|
|
Delaware
|
Covanta Tulsa Renewable Energy LLC
|
|
Delaware
|
Covanta Union, LLC
|
|
Delaware
|
Covanta Wallingford Associates, Inc.
|
|
Delaware
|
Covanta Warren Energy Resource Co., LLC
|
|
Delaware
|
Covanta Waste to Energy Asia Limited
|
|
Hong Kong
|
Covanta Waste to Energy Asia Ltd
|
|
Mauritius
|
Covanta Waste to Energy of Italy, Inc.
|
|
Delaware
|
Covanta York Renewable Energy LLC
|
|
Delaware
|
Dublin Waste to Energy Group (Holdings) Limited
|
|
Ireland
|
Dublin Waste to Energy (Holdings) Limited
|
|
Ireland
|
Dublin Waste to Energy Limited
|
|
Ireland
|
Dublin Waste to Energy Supply Limited
|
|
Ireland
|
Earls Gate Energy Centre Limited
|
|
Jersey
|
ECOvanta, LLC
|
|
Delaware
|
Edison (Bataan) Cogeneration Corporation
|
|
Philippines
|
Enereurope Holdings III, B.V.
|
|
Netherlands
|
EGEC Holdings Limited
|
|
Jersey
|
Environmental Pharmaceuticals, LLC
|
|
Arizona
|
GARCO, Inc.
|
|
North Carolina
|
Hidro Operaciones Don Pedro S.A.
|
|
Costa Rica
|
Industrial Oil Tank Services Corp.
|
|
New York
|
Mount Kisco Transfer Station, Inc.
|
|
New York
|
MSW Energy Finance Co. II, Inc.
|
|
Delaware
|
OLMEC Insurance Ltd.
|
|
Bermuda
|
Peabody Monofill Associates, Inc.
|
|
Massachusetts
|
Recoil, LLC
|
|
Pennsylvania
|
Return-Tech, Inc.
|
|
Canada
|
Rookery South Holding Limited
|
|
United Kingdom
|
Rookery South Limited
|
|
United Kingdom
|
SEMASS Partnership
|
|
Massachusetts
|
South Fork II Associates Limited Partnership
|
|
Washington
|
TransRiver Canada Incorporated
|
|
Canada
|
Waste Recovery Solutions, LLC
|
|
Florida
|
(1)
|
Registration Statement (Form S-8 No. 333-119609) pertaining to the Covanta Holding Corporation (formerly Danielson Holding Corporation) Equity Award Plan for Employees and Officers and the Covanta Holding Corporation Equity Award Plan for Directors of Covanta Holding Corporation,
|
(2)
|
Registration Statement (Form S-8 No. 333-130046) pertaining to the registration of an additional 2,000,000 shares of common stock as a result of an increase in the number of shares of common stock issuable under the Covanta Holding Corporation Equity Award Plan for Employees and Officers,
|
(3)
|
Registration Statement (Form S-8 No. 333-150705) pertaining to the registration of an additional 6,300,000 shares of common stock as a result of an increase in the number of shares of common stock issuable under the Covanta Holding Corporation Equity Award Plan for Employees and Officers and the Covanta Holding Corporation Equity Award Plan for Directors of Covanta Holding Corporation,
|
(4)
|
Registration Statement (Form S-8 No. 333-195793) pertaining to the Covanta Holding Corporation 2014 Equity Award Plan, and
|
(5)
|
Registration Statement (Form S-3 No. 333-220460) pertaining to the registration of common stock, preferred stock, warrants, debt securities, subscription rights, purchase contracts, purchase units, and depositary shares of Covanta Holding Corporation
|
1.
|
I have reviewed this
Annual
Report on Form
10-K
of Covanta Holding Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/
S
/ S
TEPHEN
J. J
ONES
|
|
Stephen J. Jones
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this
Annual
Report on Form
10-K
of Covanta Holding Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/
S
/ B
RADFORD
J. H
ELGESON
|
|
Bradford J. Helgeson
|
|
Executive Vice President and Chief Financial Officer
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Covanta Holding Corporation;
|
|
|
|
/
S
/ S
TEPHEN
J. J
ONES
|
|
Stephen J. Jones
|
|
President and Chief Executive Officer
|
|
|
|
/
S
/ B
RADFORD
J. H
ELGESON
|
|
Bradford J. Helgeson
|
|
Executive Vice President and Chief Financial Officer
|
|
|