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Item 1.01
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Entry into a Material Definitive Agreement.
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Underwriting Agreement
On April 24, 2019, Aqua America, Inc.
(the “Company”) priced an offering (the “Offering”) of (i) $400,000,000 3.566% Senior Notes due 2029 (the
“2029 Notes”) and (ii) $500,000,000 4.276% Senior Notes due 2049 (the “2049 Notes” and, together with the
2029 Notes, the “Notes”). In connection with the Offering, the Company entered into an underwriting agreement, dated
April 24, 2019 (the “Underwriting Agreement”), with RBC Capital Markets, LLC and Goldman Sachs & Co. LLC, as representatives
of the several underwriters named therein (the “Underwriters”). The Underwriting Agreement includes customary representations,
warranties and covenants by the Company. Under the terms of the Underwriting Agreement, the Company has agreed to indemnify the
Underwriters against certain liabilities.
The description of the Underwriting Agreement
contained herein is qualified in its entirety by reference to the Underwriting Agreement filed as Exhibit 1.1 to this Current Report
and incorporated herein by reference.
The Offering closed on April 26, 2019.
The Notes were issued and sold in a registered public offering pursuant to the Company’s Registration Statement on Form S-3
(Registration No. 333-223306), including a prospectus supplement dated April 24, 2019 to the prospectus contained therein dated
February 28, 2018, filed by the Company with the Securities and Exchange Commission, pursuant to Rule 424(b)(5) under the Securities
Act of 1933, as amended.
Indenture
The Notes were issued pursuant to the
indenture, dated as of April 23, 2019 (the “Base Indenture”), as supplemented by the First Supplemental Indenture,
dated as of April 23, 2019 (the “First Supplemental Indenture”), and the Third Supplemental Indenture, dated as of
April 26, 2019 (the “Third Supplemental Indenture” and, together with the Base Indenture and First Supplemental Indenture,
the “Indenture”), each between the Company and U.S. Bank N.A., as trustee. The 2029 Notes will bear interest at a rate
of 3.566% per annum and the 2049 Notes will bear interest at a rate of 4.276% per annum. Interest on the 2029 Notes will be payable
semi-annually on May 1 and November 1 of each year, commencing on November 1, 2019. Interest on the 2049 Notes will be payable
semi-annually on May 1 and November 1 of each year, commencing on November 1, 2019. The 2029 Notes will mature on May 1, 2029 and
the 2049 Notes will mature on May 1, 2049.
The Indenture contains customary terms
and covenants, including that upon certain events of default occurring and continuing, either the trustee or the holders of not
less than 25% in aggregate principal amount of any series of Notes then outstanding may declare the unpaid principal of such series
of Notes and any accrued and unpaid interest thereon immediately due and payable. In the case of certain events of bankruptcy,
insolvency or reorganization relating to the Company, the principal amount of the Notes together with any accrued and unpaid interest
thereon will become due and payable.
If (i) the closing of the previously
announced acquisition by the Company of LDC Funding LLC (the “Acquisition”) has not been consummated on or prior to
April 22, 2020, (ii) on or prior to April 22, 2020 and prior to the consummation of the Acquisition, the Acquisition agreement
is terminated or (iii) prior to the consummation of the Acquisition, the Company otherwise publicly announces that the Acquisition
will not be consummated, then the Company will be required to redeem all outstanding Notes on a special mandatory redemption date
at a special mandatory redemption price equal to 101% of the aggregate principal amount of the Notes, plus accrued and unpaid interest
thereon, if any, to, but excluding, the special mandatory redemption date.
Upon at least 10 but no more than 60
days’ notice to holders of any series of Notes, the Company may redeem such series of Notes for cash in whole, at any time,
or in part, from time to time, prior to maturity, at redemption prices that include a make-whole premium, plus accrued and unpaid
interest, in each case as specified in the Indenture. However, no make-whole premium will be included in the redemption prices
for any redemptions of (i) the 2029 Notes on or after February 1, 2029 and (ii) the 2049 Notes on or after November 1, 2048.
The descriptions of the Indenture and
the Notes contained herein are qualified in their entirety by reference to the Base Indenture, the First Supplemental Indenture
and the Third Supplemental Indenture (including the forms of global notes for the Notes) filed as Exhibits 4.1, 4.2 and 4.3, respectively,
to this Current Report and are incorporated herein by reference as though each were fully set forth herein.
Forward-Looking Statements
This Current Report on Form 8-K and
its exhibits contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including,
among others: the anticipated use of proceeds from offerings made by the Company in whole or in part to fund the Acquisition.
These statements involve risks and uncertainties that could cause actual results to differ materially, including, but not limited
to, the ability to price and to satisfy customary closing conditions with respect to the offerings, prevailing market conditions,
and the impact of general economic, industry or political conditions in the United States or internationally. There are important
factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements
including: general economic business conditions; changes in regulations or regulatory treatment, including a change in federal
tax policy; availability and access to capital; the cost of capital; disruptions in the credit markets; the ability of the Company
to successfully close and integrate the Acquisition; and other factors discussed in the Company’s Annual Report on Form
10-K, which was filed with the SEC on February 26, 2019 and the Company’s Current Report on Form 8-K/A, which was filed
with the SEC on April 15, 2019. For more information regarding risks and uncertainties associated with the Company’s business,
please refer to the Company’s annual, quarterly and other SEC filings. The Company is not under any obligation - and expressly
disclaims any such obligation - to update or alter its forward-looking statements whether as a result of new information, future
events or otherwise.