Exhibit 3
FIRST AMENDMENT
to
RIGHTS AGREEMENT
FIRST AMENDMENT dated as of May 31, 1999 ("this Amendment") between
Aquarion Company, a Delaware corporation (the "Company"), and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent.
WHEREAS, the above-mentioned parties have previously entered into that
certain Rights Agreement dated as of June 25, 1996 (the "Rights Agreement")
governing certain preferred stock purchase rights (the "Rights") of the
Company's stockholders;
WHEREAS, the Company is entering into an Agreement and Plan of Merger
dated as of May 31, 1999 (the "Merger Agreement"), by and among the Company,
Yorkshire Water plc, a public limited company incorporated under the laws of
England and Wales ("Parent"), and Waterman Acquisition Corp., a Delaware
corporation and an indirect wholly-owned subsidiary of Parent ("Merger Sub"),
pursuant to which Merger Sub will be merged with and into the Company and the
Company shall become a wholly-owned subsidiary of Parent (the "Merger");
WHEREAS, the Board of Directors deems it desirable and in the best
interests of its stockholders that the transactions contemplated by the Merger
Agreement be consummated;
WHEREAS, the Merger Agreement provides that prior to the execution of
the Merger Agreement, the Board of Directors of the Company shall have approved
an amendment to the Rights Agreement to the effect that neither the execution of
the Merger Agreement nor the consummation of the Merger will (i) cause the
Rights to become exercisable, (ii) cause the Parent, Merger Sub and their
affiliates to become an Acquiring Person (as such term is defined in the Rights
Plan) and (iii) will not give rise to a Stock Acquisition Date or a Distribution
Date (as each such term is defined in the Rights Plan);
WHEREAS, the Rights are redeemable; and
WHEREAS, such parties wish to amend the Rights Agreement in the manner
set forth below.
NOW, THEREFORE, the parties hereto agree as follows:
1. All capitalized terms used herein, unless otherwise defined
herein, shall have the meanings given them in the Rights Agreement, and each
reference in the Rights Agreement to "this Agreement," "hereof," "herein,"
"hereunder" or "hereby" and each other similar reference shall be deemed to
refer to the Rights Agreement as amended hereby. All references to the Rights
Agreement in any other agreement between or among any of the parties hereto
relating to the transactions contemplated by the Rights Agreement shall be
deemed to refer to the Rights Agreement as amended hereby.
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2. The definition of "Acquiring Person" in Section 1 of the Rights
Agreement is hereby amended by adding the following provision to the end of the
clause immediately preceding the first "provided, however" in paragraph (a) of
Section 1:
"and shall not include Parent, Merger Sub or any of their Affiliates or
Associates which otherwise would become an Acquiring Person solely by
reason or as a result of the execution or delivery of the Merger Agreement
or the consummation of the Merger or any other transaction contemplated by
the Merger Agreement"
3. The definition of "Stock Acquisition Date" in Section 1 of the
Rights Agreement is hereby amended by adding the following provision to the end
of paragraph (r) of Section 1:
"and shall not occur as a result of the execution or delivery of the Merger
Agreement or the consummation of the Merger or any other transaction
contemplated by the Merger Agreement"
4. The definition of "Distribution Date" in Section 3 of the Rights
Agreement is hereby amended by adding the following provision to the end of the
first sentence of paragraph (a) of Section 3:
"; but the Distribution Date shall not occur as a result of the execution
or delivery of the Merger Agreement or the consummation of the Merger or
any other transaction contemplated by the Merger Agreement."
5. The following definitions are hereby added to Section 1 of the
Rights Agreement in the appropriate alphabetical order:
""Merger" means the merger of Merger Sub with and into the Company
upon the terms and conditions set forth in the Merger Agreement."
""Merger Agreement" means the Agreement and Plan of Merger, dated as
of May 31, 1999, among the Company, Merger Sub and Parent."
""Parent" means Yorkshire Water plc, a public limited company
incorporated under the laws of England and Wales."
""Merger Sub" means Waterman Acquisition Corp., a Delaware corporation
and an indirect wholly owned subsidiary of Parent."
6. This Amendment shall be deemed to be a contact made under the law
of the State of Delaware and for all purposes shall be governed and construed in
accordance with the law of such State applicable to contracts to be made and
performed entirely within such State.
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7. This Amendment may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the same
instrument.
8. Except as expressly amended hereby, the Rights Agreement shall
remain in full force and effect.
9. The recitals are and shall be deemed to have been made by the
Company only.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: AQUARION COMPANY
/s/ Larry L. Bingaman By: /s/ Richard K. Schmidt
- ------------------------ -----------------------------
Name: Richard K. Schmidt
Title: President/CEO
Attest: CHASE MELLON SHAREHOLDER
SERVICES, L.L.C.
/s/ Jackie Wadsworth By: /s/ Joan B. Hayes
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Name: Jackie Wadsworth Name: Joan B. Hayes
Title: Vice President Title: Assistant Vice President