Exhibit 99.01
Strictly Private & Confidential
_______________________________
Messrs.
Rossi & Partners Ltd.
10th Floor, Bowater House West
114 Knightsbridge
London
SW1X7LT
United Kingdom
For the attention of Mr. Francesco M. Rossi
___________________________________________
30 May 1996
Dear Sirs:
Further to our meeting in Manchester on May 23 and 24, the
following outlines our agreement with respect to the engagement
by United States Filter Corporation ("USF") of Rossi & Partners
Ltd. ("R&P") as financial adviser in relation to the possible
acquisition of the Process Equipment Division of United Utilities
("UU") which includes the following companies: Envirex, Wallace
& Tiernan, General Filter, Edwards & Jones, Asdor, Consolidated
Electric and Acumem. R&P agrees to work exclusively on behalf of
USF with regard to the below outlined transaction.
1. Scope of work
The tasks undertaken by R&P, in relation to this
transaction, may include all or any of the following.
a. advice on the strategic matters to be addressed in
relation to the proposed acquisition;
b. advice during the initial discussions with UU;
c. advice on the terms and conditions of the transaction;
d. assistance in the negotiations with the Board of UU and
its advisers.
2. Remuneration
In connection with these services, USF agrees to pay an
initial retainer of US$20,000, payable on the signing of
this letter. Funds paid to date will be credited against
the $20,000.
In the event USF, herewith intended as USF and or any of its
subsidiaries, enters into a definitive agreement to acquire
all or parts of UU's Process Equipment Division which
subsequently results in an acquisition transaction, USF
agrees to pay R&P or a company indicated by R&P, a
transaction fee of 1% based on the aggregate transaction
value, payable in cash upon closing. It is understood that
such fee may be paid by a party other than USF.
For the purpose of this letter, the term "transaction value"
means an amount equal to the sum of any cash consideration
paid or the aggregate fair market value of any securities
issued.
USF hereby agrees to pay all disbursements, travel and other
outlays or expenses reasonably incurred by R&P in connection
with this appointment, such expenses to be approved in
advance. USF acknowledges that it will be responsible for
all other expenses in connection with the appointment,
including, inter alia, all accountancy, legal and other
professional expenses, including legal advice, but in all
cases to be approved in advance in writing.
3. Indemnification Clause
USF agrees that it will indemnify and hold harmless R&P, its
directors, employees, agents and controlling persons (each
being an "Indemnified Party") from and against all losses,
claims, damages, liabilities and expenses, joint or several
(including all reasonable fees of counsel and other expenses
incurred by any Indemnified Party in connection with the
preparation for, or defense of, any claim, action or
proceeding, whether or not resulting in any liability), to
which such Indemnified Party may become subject under any
applicable laws or otherwise, related to or arising out of
the engagement of R&P, pursuant to this letter. USF will
not be liable under the foregoing indemnification provision
to the extent that any loss, claim, damage, liability or
expense is found to have resulted primarily from R&P's bad
faith or gross negligence.
4. Termination
This agreement shall remain in force until further notice.
However, USF may terminate the agreement without cause at
any time by written notice to R&P. R&P reserves the right
to terminate their engagement hereunder at any time and
without liability or continuing obligation to USF.
Termination of this agreement by any party shall not affect
either R&P's indemnification or R&P's right to receive fees
if the acquisition of the Process Equipment Division takes
place within two years of the termination date of this
agreement.
5. Governing Law
This agreement shall in all respects be governed by, and
construed and enforced in accordance with the English laws.
6. Arbitration Clause
Any dispute arising with respect to, or in connection with,
our engagement shall be finally decided by a panel of three
arbitrators in accordance with the Rules of International
Arbitration of the Chamber of Commerce of Geneva, it being
understood that the chairman of any panel shall be designed
directly by the above mentioned Chamber of Commerce and the
other two panelists shall be appointed one each by each of
the parties. In case an agreement is not reached the
appointment of a panelist shall be made by the above Chamber
of Commerce. Unless otherwise agreed in writing to by the
parties, the arbitrators shall be fluent in English
language. The cost of any arbitration will be assessed
against the unsuccessful party and the arbitrators will be
required to make such cost part of any ruling issued by
them.
Yours faithfully,
/s/ Richard J. Heckmann
Richard J. Heckmann
Accepted as of the date first written above.
Rossi & Partners Ltd.
By /s/ Francesco M. Rossi