SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): December 21, 2001
Covanta Energy Corporation
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(Exact Name of Registrant as Specified in Charter)
Delaware 1-3122 13-5549268
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(State or Other Jurisdiction (Commission File (IRS Employer
of Incorporation) Number) Identification No.)
40 Lane Road, Fairfield, New Jersey 07004
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (973) 882-9000
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Item 5. Other Events.
On December 21, 2001, Covanta Energy Corporation issued a press
release, a copy of which is attached hereto as Exhibit A.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(a) Financial Statements of business acquired: Not applicable.
(b) Pro forma financial information: Not applicable.
(c) Exhibit: Not applicable.
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereto duly authorized.
Date: December 21, 2001
COVANTA ENERGY CORPORATION
By: /s/ Louis M. Walters
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Name: Louis M. Walters
Title: Vice President and
Treasurer
Exhibit A
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[COVANTA LOGO OMMITTED]
FOR IMMEDIATE RELEASE
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COVANTA TO REVIEW STRATEGIES TO MAXIMIZE SHAREHOLDER VALUE
-- Liquidity Update Provided --
-- Salomon Smith Barney Assisting Board of Directors --
FAIRFIELD, NJ, DECEMBER 21, 2001 - Covanta Energy Corporation (NYSE:COV)
announced today it is in the process of conducting a comprehensive review of its
strategic options to maximize shareholder value. Salomon Smith Barney is
assisting management and the Board of Directors in the review.
Scott Mackin, CEO and a member of the Board, said, "The Board is very pleased
with the Company's strong operational performance in its core energy business.
However, given the Company's size, limited current cash availability and the
complexity of its overall corporate structure, which includes some remaining
non-energy aviation and entertainment assets, it is incumbent on us to conduct
this analysis and review."
Delays in payment of remaining California energy receivables and in the sale of
aviation and entertainment assets continue to adversely affect Covanta's ability
to meet required cash flows under its master credit facility. The Company
believes it will be unable to access the capital markets in the immediate future
due to market conditions as they relate to energy companies.
As previously stated, the Company is discussing with its banks the need for
covenant waivers and access to short term liquidity. Although its banks are
willing to provide the required waivers through January 2002, they have not at
this time agreed to provide additional liquidity. The Company believes that it
has sufficient liquidity to continue immediate operations and is considering
various options to supplement its operating cash. The Company will continue to
discuss these issues with its banks in conjunction with its review of strategic
alternatives.
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Covanta Energy Corporation is an internationally recognized designer, developer,
owner and operator of power generation projects and provider of related
infrastructure services. The Company's independent power business develops,
structures, owns, operates and maintains projects that generate power for sale
to utilities and industrial users worldwide. Its waste-to-energy facilities
convert municipal solid waste into energy for numerous communities,
predominantly in the United States. The Company also offers single-source
design/build/operate capabilities for water and wastewater treatment
infrastructures. Additional information about Covanta can be obtained via the
Internet at www.covantaenergy.com, or through the Company's automated
information system at 866-COVANTA (268-2682).
Certain statements included in this news release are forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. Forward-looking statements above
include, but are not limited to, expected earnings and future financial
performance. Although Covanta believes that its expectations are reasonable, it
can give no assurance that these expectations will prove to have been correct.
Factors that could cause Covanta's actual results to differ materially from
those contemplated in the forward-looking statements above include, among
others, the following:
- - Economic, capital market and other business conditions effecting power
generation enterprises specifically and commerce generally including
interest, inflation and exchange rates; weather conditions;
creditworthiness of customers and suppliers, changes in fuel costs and
supply; unscheduled outages; environmental incidents; electric
transmission restraints and risks and uncertainties associated with
the recently deregulated energy industry;
- - Trade, monetary, fiscal, taxation, energy regulation and environmental
policies of governments, agencies and similar organizations in
geographic areas where Covanta has a financial interest;
- - Financial or regulatory accounting principles or policies imposed by
the Financial Accounting Standards Board, the Securities and Exchange
Commission, the Federal Energy Regulatory Commission and similar
entities with regulatory oversight, including without limitation the
impact of newly adopted FASB 133 relating to accounting for derivatives
which is effective beginning January 1, 2001. The impact of FASB 133
will vary between accounting periods based on changes in pricing of
various items bought and sold by the Company.
- - Cost and other effects of legal and administrative proceedings,
settlements, investigations and claims;
- - Limitations on Covanta's ability to control the development or
operation of projects in which Covanta has less than 100% interest;
- - The lack of operating history at development projects provides only a
limited basis for management to project the results of future
operations.
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Contacts: Investor Relations:
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Louis M. Walters, 973-882-7260
Media Relations:
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Eric Berman, David Lilly
Kekst & Company, 212-521-4800
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