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 26, 1996
AQUARION COMPANY
------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-8060 06-0852232
- ------------ --------------------------- ------------------
(State of (Commission File Number) IRS Employer
Incorporation) Identification No.
835 Main Street
Bridgeport, Connecticut 06601
--------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(203) 335-2333
--------------------------------------
(Registrant's telephone number)
Item 5. Other Events
------------
On June 25, 1996 the Board of Directors of Aquarion Company
(the "Company") declared a dividend of one preferred share purchase
right (a "Right") for each outstanding share of common stock, no par
value ($1 per share stated value), of the Company (the "Common Stock").
The dividend is payable on July 12, 1996 (the "Record Date") to the
stockholders of record on that date. Upon the earlier of (i) the
expiration of rights (the "Existing Rights") issued pursuant to the
Rights Agreement dated as of November 18, 1986 between the Company and
The Chase Manhattan Bank N.A., Rights Agent (the "Prior Rights
Agreement") or (ii) the redemption of the Existing Rights as provided in
the Prior Rights Agreement (the earlier of such dates referred to as the
"Effective Date"), each Right shall entitle the registered holder to
purchase from the Company one one-hundredth of a share of Series B
Junior Participating Preferred Stock, without par value (the "Preferred
Stock") of the Company at a price of $120 per one one-hundredth of a
share of Preferred Stock (the "Purchase Price"), subject to adjustment.
The description and terms of the Rights are set forth in a Rights
Agreement dated as of June 25, 1996 as the same may be amended from time
to time (the "Rights Agreement"), between the Company and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons
(with certain exceptions an "Acquiring Person") have acquired beneficial
ownership of 15% or more of the outstanding shares of Common Stock or
(ii) 10 business days (or such later date as may be determined by action
of the Board of Directors prior to such time as any person or group of
affiliated persons becomes an Acquiring Person) following the
commencement of, or announcement of an intention to make, a tender offer
or exchange offer the consummation of which would result in the
beneficial ownership by a person or group of 15% or more of the out-
standing shares of Common Stock (the earlier of such dates being called
the "Distribution Date"), the Rights will be evidenced, with respect to
any of the Common Stock certificates outstanding as of the Record Date,
by such Common Stock certificate together with a copy of this Summary of
Rights.
The Rights Agreement provides that, until the Distribution
Date (or earlier redemption or expiration of the Rights), the Rights
will be transferred with and only with the Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the Rights),
new Common Stock certificates issued after the Record Date upon transfer
or new issuances of Common Stock will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date (or
earlier redemption or expiration of the Rights), the surrender for
transfer of any certificates for shares of Common Stock
outstanding as of the Record Date, even without such notation or
a copy of this Summary of Rights, will also constitute the transfer
of the Rights associated with the shares of Common Stock represented
by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights
("Right Certificates") will be mailed to holders of record of the
Common Stock as of the close of business on the Distribution Date
and such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on the tenth anniversary of the Effective Date
(the "Final Expiration Date"), unless the Final Expiration Date is
advanced or extended or unless the Rights are earlier redeemed or ex-
changed by the Company, in each case as described below.
The Purchase Price payable, and the number of shares of Pre-
ferred Stock or other securities or property issuable, upon exercise of
the Rights are subject to adjustment from time to time to prevent
dilution (i) in the event of a stock dividend on, or a subdivision,
combination or reclassification of, the Preferred Stock, (ii) upon the
grant to holders of the Preferred Stock of certain rights or warrants to
subscribe for or purchase Preferred Stock at a price, or securities
convertible into Preferred Stock with a conversion price, less than the
then-current market price of the Preferred Stock or (iii) upon the
distribution to holders of the Preferred Stock of evidences of
indebtedness or assets (excluding regular periodic cash dividends or
dividends payable in Preferred Stock) or of subscription rights or
warrants (other than those referred to above).
The number of outstanding Rights are also subject to
adjustment in the event of a stock split of the Common Stock or a stock
dividend on the Common Stock payable in shares of Common Stock or subdi-
visions, consolidations or combinations of the Common Stock occurring,
in any such case, prior to the Distribution Date.
Shares of Preferred Stock purchasable upon exercise of the
Rights will not be redeemable. Each share of Preferred Stock will be
entitled, when, as and if declared, to a minimum preferential quarterly
dividend payment of $1 per share but will be entitled to an aggregate
dividend of 100 times the dividend declared per share of Common Stock.
In the event of liquidation, dissolution or winding up of the Company,
the holders of the Preferred Stock will be entitled to a minimum
preferential liquidation payment of $100 per share (plus any accrued but
unpaid dividends) but will be entitled to an aggregate payment of 100
times the payment made per share of Common Stock. Each share of
Preferred Stock will have 100 votes, voting together with the Common
Stock. Finally, in the event of any merger, consolidation or other
transaction in which shares of Common Stock are
2
converted or exchanged, each share of Preferred Stock will be entitled
to receive 100 times the amount received per share of Common Stock.
These rights are protected by customary antidilution provisions.
Because of the nature of the Preferred Stock's dividend,
liquidation and voting rights, the value of the one one-hundredth
interest in a share of Preferred Stock purchasable upon exercise of each
Right should approximate the value of one share of Common Stock.
In the event that any person or group of affiliated or
associated persons becomes an Acquiring Person, each holder of a Right,
other than Rights beneficially owned by the Acquiring Person (which will
thereupon become void), will thereafter have the right to receive upon
exercise of a Right at the then current exercise price of the Right,
that number of shares of Common Stock having a market value of two times
the exercise price of the Right.
In the event that, after a person or group has become an
Acquiring Person, the Company is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or
earning power are sold, proper provision will be made so that each
holder of a Right (other than Rights beneficially owned by an Acquiring
Person which will have become void) will thereafter have the right to
receive, upon the exercise thereof at the then current exercise price of
the Right, that number of shares of common stock of the person with whom
the Company has engaged in the foregoing transaction (or its parent),
which number of shares at the time of such transaction will have a
market value of two times the exercise price of the Right.
At any time after any person or group becomes an Acquiring
Person and prior to the acquisition by such person or group of 50% or
more of the outstanding shares of Common Stock or the occurrence of an
event described in the prior paragraph, the Board of Directors of the
Company may exchange the Rights (other than Rights owned by such person
or group which will have become void), in whole or in part, at an
exchange ratio of one share of Common Stock, or one one-hundredth of a
share of Preferred Stock (or of a share of a class or series of the
Company's preferred stock having equivalent rights, preferences and
privileges), per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an adjustment of
at least 1% in such Purchase Price. No fractional shares of Preferred
Stock will be issued (other than fractions which are integral multiples
of one one-hundredth of a share of Preferred Stock, which may, at the
election of the Company, be evidenced by depositary receipts) and in
lieu thereof, an adjustment in cash will be made based on the market
price of the
3
Preferred Stock on the last trading day prior to the date of exercise.
At any time prior to the time an Acquiring Person becomes
such, the Board of Directors of the Company may redeem the Rights in
whole, but not in part, at a price of $.01 per Right (the "Redemption
Price"). The redemption of the Rights may be made effective at such
time, on such basis and with such conditions as the Board of Directors
in its sole discretion may establish. Immediately upon any redemption
of the Rights, the right to exercise the Rights will terminate and the
only right of the holders of Rights will be to receive the Redemption
Price.
For so long as the Rights are then redeemable, the Company
may, except with respect to the redemption price, amend the Rights in
any manner. After the Rights are no longer redeemable, the Company may,
except with respect to the redemption price, amend the Rights in any
manner that does not adversely affect the interests of holders of the
Rights.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including, without
limitation, the right to vote or to receive dividends.
4
Item 7. Exhibits
--------
1. Rights Agreement, dated as of June 25, 1996, between the
Company and ChaseMellon Shareholder Services, L.L.C. which
includes the Certificate of Designations for the Series B
Junior Participating Preferred Stock as Exhibit A, the form of
Right Certificate as Exhibit B and the Summary of Rights to
Purchase Preferred Shares as Exhibit C. Pursuant to the
Rights Agreement, printed Right Certificates will not be
mailed until as soon as practicable after the earlier of the
tenth day after public announcement that a person or group has
acquired beneficial ownership of 15% or more of the shares of
Common Stock or the tenth business day after a person
commences, or announces its intention to commence, a tender
offer or exchange offer the consummation of which would result
in the beneficial ownership by a person or group of 15% or
more of the shares of Common Stock.
2. Press Release dated June 25, 1996.
5
SIGNATURE
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 hereunto duly authorized.
AQUARION COMPANY
Dated: June 26, 1996 By: /s/ Janet M. Hansen
-------------------
Name: Janet M. Hansen
Title: Executive Vice President,
Chief Financial Officer
and Treasurer
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
1. Rights Agreement, dated as of June 25, 1996, between the Company
and ChaseMellon Shareholder Services, L.L.C. which includes the
Certificate of Designations for the Series B Junior Participating
Preferred Stock as Exhibit A, the form of Right Certificate as
Exhibit B and the Summary of Rights to Purchase Preferred Shares as
Exhibit C. Pursuant to the Rights Agreement, printed Right
Certificates will not be mailed until as soon as practicable after
the earlier of the tenth day after public announcement that a
person or group has acquired beneficial ownership of 15% or more of
the shares of Common Stock or the tenth business day after a person
commences, or announces its intention to commence, a tender offer
or exchange offer the consummation of which would result in the
beneficial ownership by a person or group of 15% or more of the
shares of Common Stock.
2. Press Release dated June 25, 1996.