Casella letter highlights finances, appointment of former Republic chairman

Casella Waste Systems Inc., a Rutland, Vermont-based regional solid waste, recycling and resource management services company, has announced that in connection with its 2015 annual meeting of stockholders to be held Nov. 6, 2015, its board of directors has issued an additional letter to Casella’s stockholders.

The letter, which is being sent to stockholders together with a white proxy card, highlights the improvements in Casella’s financial performance demonstrated by its preliminary financial results for the third quarter. In addition, the letter highlights the appointment of James E. O’Connor, the former chairman of Phoenix-based Republic Services Inc. who joined the Casella board of directors in July 2015, to serve as the Casella board’s lead independent director.

The Casella board recommends that stockholders vote on the white proxy card for the election of all three of its nominees—John W. Casella, William P. Hulligan and James E. O’Connor—standing for election at the 2015 annual meeting. Stockholders are urged to vote the white proxy card via Internet, telephone or mail by following the instructions provided, Casella says. The board also urges stockholders to discard any gold proxy card or voting instruction form they may receive from JCP Investment Management LLC (JCP Group) and the other participants in its solicitation.

As previously disclosed, the JCP Group is conducting a proxy contest and are seeking the election at the 2015 annual meeting of two director candidates in opposition to the nominees unanimously recommended by the Casella board. In order for stockholders to have access to all relevant information concerning the 2015 annual meeting that Casella has made available, Casella says it has developed a website focused on the 2015 annual meeting, which is accessible at www.casellashareholders.com.

The full text of the letter is as follows:

October 21, 2015

Dear Fellow Casella Stockholder:

IMPORTANT BREAKING NEWS!

2015 has been an exciting year for Casella Waste Systems Inc. Over the past year, we have made a number of announcements related to our improved financial and operating results and our efforts to refresh the board of directors that is overseeing our efforts to drive stockholder value. In this regard, we once again have some very exciting news to share with you.

CASELLA ANNOUNCES PRELIMINARY FINANCIAL RESULTS FOR THE THIRD QUARTER ENDED SEPTEMBER 30, 2015 DEMONSTRATING IMPROVED FINANCIAL RESULTS DRIVEN BY STRONG EXECUTION

On Oct. 19, 2015, Casella reported preliminary results for the three-month period ended Sept. 30, 2015, and demonstrated that it continues to execute well against key strategies driving improved financial performance. Third quarter preliminary financial highlights included the following:

• Revenues were $146.2 million, up $4.3 million, or 3 percent, from the same period in 2014.
• Operating income was $12.7 million, up $2.1 million, or 19.5 percent, from the same period in 2014.
• Net income attributable to common stockholders was $2.3 million, up $1.2 million, or 112.6 percent, from the same period in 2014.
• During the third quarter, we continued to execute well against our key strategies of increasing landfill returns, improving collection route profitability, creating incremental value through resource solutions, reducing financial and operational risks, and improving our balance sheet. In addition, Casella has continued to demonstrate its commitment to reducing leverage and increasing its cash flow generation by retiring its highest cost debt. During the third quarter, Casella permanently retired $9.7 million of it 7.75 percent senior subordinated notes due 2019 using positive cash flow generated year-to-date.

IN THE LATEST SIGNIFICANT CHANGE TO THE CASELLA BOARD TO BE IMPLEMENTED OVER THE PAST YEAR, JAMES E. O'CONNOR HAS BEEN NAMED AS CASELLA’S LEAD INDEPENDENT DIRECTOR

On the same date that we announced our improved financial results, we also announced that James E. O'Connor, a waste management industry veteran who joined the Casella Waste Systems Inc. board of directors in July 2015, has been appointed to serve as the Casella board’s lead independent director effective immediately.

We believe Mr. O’Connor is extremely well-suited to serve as the Casella board’s lead independent director. We also believe that his past experience leading the board of directors of Republic Services Inc., the second largest waste management company in North America; his 40 years of experience in the waste management industry; and his experience serving on the board of directors of other publicly traded companies provides him with the relevant leadership, industry and governance experience needed for a strong lead independent director. Mr. O’Connor’s appointment is the result of constructive input from our stockholders and is further evidence of our ongoing commitment to enhance the ability of our board to serve the long-term interests of stockholders.

The change in leadership of the Casella board announced earlier this week is the latest significant change in the Casella board to be implemented over the past year. Reflective of the Casella board’s continuing commitment to recruit new independent and highl -qualified directors that have perspectives, insights, experiences and competencies that expand the depth and breadth of the board, Mr. O’Connor and fellow waste management industry veteran William P. Hulligan, both of whom are standing for re-election to the Casella board at the 2015 annual meeting, were added to the Casella board as independent directors within the past four months after a year-long director search process. O’Connor and Hulligan are two of the most experienced, accomplished and admired individuals in the waste management industry.

Hulligan and O’Connor bring to the Casella board extensive senior management and governance experience at leading waste management companies as well as a track record of driving growth and stockholder value creation. As Casella continues to execute on its ongoing strategic initiatives to drive revenues and enhance profitability, the experience and expertise of Hulligan and O’Connor will be extremely valuable to Casella.

With the recent additions of Hulligan and O’Connor to the Casella board, the Casella board is composed of nine highly qualified and experienced directors, seven of whom are independent, and boast a broad and diverse set of skills and experiences in the areas of solid waste collection, recycling, disposal services, operations, accounting, finance, mergers and acquisitions, capital markets, capital allocation, capital structure, risk management and strategic planning.

SUPPORT YOUR BOARD’S HIGHLY QUALIFIED NOMINEES BY VOTING THE WHITE PROXY CARD TODAY

The upcoming annual meeting is a significant event that could determine the future of Casella. Your vote is important—no matter how many shares you own—as no stockholder is too small.

Whether or not you plan to attend the annual meeting, we urge you to sign, date and return the enclosed white proxy card in the postage-paid envelope provided and vote for all your board’s highly qualified and very experienced nominees—John W. Casella, William P. Hulligan and James E. O’Connor. You may also vote by telephone or Internet by following the instructions on the enclosed white proxy card.

We also urge you to discard any proxy card or voting instruction form you may receive from JCP. Even a withhold vote with respect to JCP’s nominees on its proxy card will cancel any proxy previously given to Casella. If you previously signed a proxy card sent to you by JCP, you can revoke that proxy card and vote for your board’s recommended nominees by voting a new white proxy card. Only your latest-dated proxy card will count. Your board encourages you to vote each white proxy card you receive.

On behalf of your board of directors, we thank you for your continued support of Casella. We look forward to communicating further with you in the coming weeks.

Sincerely, 

John W. Casella, chairman and CEO

James E. O'Connor, lead independent director