UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): June 2, 2015

 

 

COVANTA HOLDING CORPORATION

(Exact name of Registrant as Specified in Its Charter)

 

  Delaware  
 

(State or Other Jurisdiction of

Incorporation)

 
1-6732     95-6021257

(Commission

File Number)

   

(IRS Employer

Identification No.)

 

445 South Street, Morristown, NJ   07960
(Address of principal executive offices)   (Zip Code)

(862) 345-5000

(Registrant’s Telephone Number, Including Area Code)

 

                                                                                              

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12(b))

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2)

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On June 2, 2015, Covanta Holding Corporation (the “Company”) announced that Michael J. de Castro has been appointed as the Executive Vice President, Supply Chain of the Company, effective July 13, 2015 (the “Effective Date”), reporting directly to Stephen J. Jones, the Company’s President and Chief Executive Officer. In Mr. de Castro’s position, he will have overall responsibility for establishing the direction, strategy and execution of global supply chain and operations for the Company.

Mr. de Castro, age 52, is currently the fulfillment director in the Performance Materials Division of Air Products and Chemicals, Inc. (NYSE: APD) (“Air Products”), a global supplier of industrial gases, equipment and services located in Allentown, Pennsylvania, a position he has held since October 2014. From January 2013 until September 2014, Mr. de Castro served as director, global operations strategic development for Air Products. Mr. de Castro joined Air Products in 2006 serving in various operations capacities including director, operations-Americas Merchant Gases from 2007 until June 2010 when he left Air Products to become chief executive officer of Interstate Waste Services, Inc. (“Interstate”) from July 2010 until September 2012. Interstate, located in Basking Ridge, New Jersey, is an environmental services company engaged in the collection, recycling, transportation, and disposal of non-hazardous solid waste in the eastern United States. From 1989 to 2005, Mr. de Castro was employed by American Ref-Fuel Company, a waste-to-energy company acquired in 2005 by the Company. Mr. de Castro received a B.S. degree in mechanical engineering from the University of Alabama in 1984 and an M.B.A. from Boston University in 2002.

In connection with his appointment, Mr. de Castro has agreed to the terms of an offer letter (the “Offer Letter”) dated May 12, 2015 providing for (i) an annual base salary of $335,000 subject to annual review; (ii) participation in the Company’s 2015 annual cash bonus program with a target bonus (at 100% of target) of up to 65% of base salary (prorated for a partial year); the bonus may be higher (up to 200% of target) or lower depending on Mr. de Castro’s overall performance and the results against annual performance objectives approved by the Compensation Committee of the Board of Directors (the “Board”) of the Company; (iii) eligibility to participate in all equity programs approved by the Compensation Committee of the Board; (iv) an initial restricted stock grant under the Company’s Equity Award Plan with a value of approximately $120,000 vesting pro rata over four years and granted on the Effective Date; (v) a cash signing bonus of $50,000, less any applicable taxes and reimbursable to the Company should Mr. de Castro not remain with the Company for at least twelve months; and (vi) the Company’s standard executive employee benefits. Mr. de Castro will also participate in the Company’s Severance Plan for Senior Executives (the “Severance Plan”).

The above description of the Offer Letter is a summary and is qualified in its entirety by the Offer Letter which is attached to this Form 8-K as Exhibit 10.1 and is incorporated herein by reference. For further information on the Company’s Severance Plan, annual cash bonus program, and Equity Award Plan and related agreements, see “Executive Compensation” in the Company’s 2015 Proxy Statement filed with the Securities and Exchange Commission on March 25, 2015.

Item 9.01. Financial Statements and Exhibits.

 

(a) Financial Statements of Businesses Acquired—Not Applicable

 

(b) Pro Forma Financial Information—Not Applicable

 

(c) Shell Company Transactions—Not Applicable

 

(d) Exhibits

 

Exhibit No.

  

Exhibit

10.1    Offer Letter dated May 12, 2015

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: June 2, 2015

 

COVANTA HOLDING CORPORATION
By: /s/ Timothy J. Simpson
Name: Timothy J. Simpson
Title:

Executive Vice President, General

Counsel & Secretary

EXHIBIT INDEX

 

Exhibit No.

  

Exhibit

10.1    Offer Letter dated May 12, 2015

Exhibit 10.1

 

 

LOGO

Covanta Energy, LLC

445 South Street

Morristown, NJ 07960

Tel: 862-345-5000

Fax: 862-345-5130

May 12, 2015

Michael J. de Castro

5572 Northwood Drive

Central Valley, PA 18034

Dear Michael:

I am pleased to offer you the Executive Vice President, Supply Chain position at Covanta based in Morristown, NJ . This position reports to Stephen Jones . Your target start date will be July 13, 2015.

The base annualized compensation for your new position will be $335,000.00, subject to annual review. You will be eligible to participate in the incentive bonus program for 2015, in which annual bonuses are awarded at the discretion of management, based on your overall performance, and the results against annual performance objectives approved by the compensation committee which include financial results of Covanta Holding Corporation. You may be eligible for a bonus (at 100% of target) of up to 65% of your base compensation (prorated for partial year) and payable in March 2016. The bonus may be higher (up to 200% of target) or lower based on the factors previously stated.

You will also be eligible to participate in all of Covanta Energy, LLC’s benefit programs, which include various life, health and accident insurance plans, and retirement plans. You are eligible to accrue 4 weeks of vacation subject to the vacation policy.

Further, you will be eligible to participate in the senior management equity program including the Long Term Incentive Plan (LTIP). Your 2016 annual LTIP grant is expected to be valued at approximately 1.5 times your annual base salary, subject to both your performance, the approval of the Board of Directors and the terms and conditions of the Company’s Equity Award Plan. Your 2016 grant will be a combination of time and performance based equity. You will be given a copy of Covanta’s TSR Award Agreement Participant Guide which will explain how the performance based equity program works in greater detail. As a reminder, all equity holdings, including vested and unvested grants, are subject to the stock ownership guidelines for senior management. The current guideline for EVP’s is to hold stock valued at 3.0 times base salary with five years to accomplish that level.

In addition to your annual compensation, you will receive the following on your first day of employment:

 

  •   A restricted stock grant valued at $120,000 vesting one fourth of each March 2016, March 2017, March 2018, and March 2019 assuming successful completion of time vesting criteria as defined in the Covanta Holding Corporation Restricted Stock Award Agreement.

De Castro- Offer Letter

May 12, 2015

 

We are also pleased to offer you a signing bonus in the amount of $50,000, less applicable taxes and withholdings. In the unlikely event that you leave Covanta within 12 months of your date of hire, you will be responsible for reimbursing the company for the entire signing bonus awarded.

In accordance with established Company policy, this offer is contingent upon approval of the Compensation Committee and your satisfactory completion of a background/credential check and drug screening. Once we receive the signed background release form, we will be begin the credential check process and will contact you to set up your drug screening.

Notwithstanding anything to the contrary herein, this offer is also expressly conditioned and contingent upon your obtaining a waiver and release from your current employer from any restrictive covenants, including non-competition or other restrictive covenants, that would affect your ability to perform your duties and responsibilities at Covanta.

Please acknowledge acceptance of our offer by signing below and returning one copy to my attention. I would like to take this opportunity to wish you luck in your new position, and I am sure our relationship will be one of mutual benefit. Feel free to contact me should you have any questions.

Sincerely,

/s/ Michael A. Wright

Michael A. Wright

Sr. Vice President and Chief Human Resources Officer

Accepted by:

 

/s/ Michael de Castro

May 13, 2015

Michael J. de Castro Date

cc: David S. Stone, Esq.