XYLEM INC. (NYSE:XYL) Files An 8-K Entry into a Material Definitive AgreementItem 1.01.
On December8, 2017, Xylem Inc. (the “Company”) entered into an arrangement agreement (the “Arrangement Agreement”) with Pure Technologies Ltd., a corporation existing under the laws of the Province of Alberta (“Pure”), to which the Company or a subsidiary of the Company will acquire all of the issued and outstanding common shares (the “Shares”) of Pure for CAD $9.00 per Share (the “Share Consideration”) by way of a statutory plan of arrangement (the “Arrangement”) under the Business Corporations Act (Alberta) (the “ABCA”). The Share Consideration represents an aggregate, enterprise value of CAD$509million, or USD$397million. As a result of the Arrangement, Pure will become a direct or indirect, wholly-owned subsidiary of the Company.
The Arrangement Agreement contains customary representations, warranties and covenants of the Company and Pure. The Arrangement is subject to various conditions, including without limitation: (i)the expiration or termination of any waiting period applicable to the consummation of the Arrangement under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; (ii)the approval of the shareholders of Pure (the “Pure Shareholder Approval”) at a special meeting of the securityholders of Pure (the “Pure Meeting”); (iii) the receipt of an interim order and a final order of the Court of Queen’s Bench of Alberta approving the Arrangement under Subsection 193(4) of the ABCA; and (iv)other customary closing conditions.
The Arrangement Agreement also requires Pure to abide by customary “no-shop” restrictions on its ability to solicit alternative acquisition proposals from third parties or to provide non-public information to, or enter into discussions or negotiations with, third parties regarding alternative acquisition proposals.
The Arrangement Agreement contains certain termination rights, including the right of Pure to terminate the Arrangement Agreement under certain circumstances to accept a superior proposal from a third party after the Company has been provided an opportunity to match such proposal. The Arrangement Agreement also provides that, upon termination of the Arrangement Agreement in certain circumstances, a termination fee of CAD$25million will be payable by Pure to the Company.
The Company and Pure will also be permitted to terminate the Arrangement Agreement in certain other circumstances without payment of a termination fee, including, among others, if the Arrangement is not completed on or before May31, 2018 under certain circumstances.
All of the directors and officers of Pure who own Shares entered into support agreements concurrent with the signing of the Arrangement Agreement, a form of which is included as an exhibit to the Arrangement Agreement, in which they have agreed, subject to the terms and conditions of the support agreements, to vote in favor of the Arrangement. Such directors and officers hold approximately 12% of the securities eligible to vote at the Pure Meeting.
The Arrangement Agreement does not contain a financing condition. The Company expects to finance the Arrangement with cash on hand and debt.
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The foregoing description of the Arrangement Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Arrangement Agreement, which is filed as Exhibit 2.1 and is incorporated by reference into this report.
The Arrangement Agreement has been included to provide investors and security holders with information regarding its terms. It is not intended to provide any other factual information about the Company, Pure or any of their respective subsidiaries or affiliates. The representations, warranties and covenants contained in the Arrangement Agreement (i)were made by the parties thereto only for purposes of that agreement and as of specific dates; (ii)were made solely for the benefit of the parties to the Arrangement Agreement; (iii)may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures exchanged between the parties in connection with the execution of the Arrangement Agreement (such disclosures include information that has been included in public disclosures, as well as additional non-public information); (iv) may have been made for the purposes of allocating contractual risk between the parties to the Arrangement Agreement instead of establishing these matters as facts; and (v)may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the Company, Pure or any of their respective subsidiaries or affiliates. Additionally, the representations, warranties, covenants, conditions and other terms of the Arrangement Agreement may be subject to subsequent waiver or modification. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Arrangement Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures. The Arrangement Agreement should not be read alone, but should instead be read in conjunction with the other information regarding the Company that is or will be contained in, or incorporated by reference into, the Forms10-K, Forms10-Q and other documents that are filed with the Securities and Exchange Commission.
On December11, 2017, the Company issued a press release announcing the execution of the Arrangement Agreement. A copy of the press release is attached as Exhibit 99.1 hereto and is incorporated herein by reference.
| Item 1.01. | Financial Statements and Exhibits. |
(d)Exhibits
|
ExhibitNo. |
Description |
| 2.1* | Arrangement Agreement, dated as of December8, 2017, by and between Xylem Inc. and Pure Technologies Ltd. |
| 99.1 | Press Release issued by Xylem Inc. on December11, 2017. |
| * | Certain schedules and exhibits have been omitted to Item 601(b)(2) of Regulation S-K. The descriptions of the omitted schedules and exhibits are contained within the Arrangement Agreement. The Company hereby agrees to furnish a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request. |
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EXHIBIT INDEX
| * | Certain schedules and exhibits have been omitted to Item 601(b)(2) of Regulation S-K. The descriptions of the omitted schedules and exhibits are contained within the Arrangement Agreement. The Company hereby agrees to furnish a copy of any omitted schedule or exhibit to the Securities and Exchange Commission upon request. |
Xylem Inc. ExhibitEX-2.1 2 d61615dex21.htm EX-2.1 EX-2.1 Exhibit 2.1 ARRANGEMENT AGREEMENT BETWEEN XYLEM INC. -AND- PURE TECHNOLOGIES LTD. December 8,…To view the full exhibit click here
About XYLEM INC. (NYSE:XYL)
Xylem Inc. is engaged in the design, manufacturing, and application of engineered technologies for the water industry. The Company is an equipment and service provider for water and wastewater applications with a portfolio of products and services addressing the cycle of water, from collection, distribution and use to the return of water to the environment. The Company has two business segments, which include Water Infrastructure (collection, distribution, return) and Applied Water (usage). The Water Infrastructure segment focuses on the transportation, treatment and testing of water, offering a range of products, including water and wastewater pumps, treatment and testing equipment, and controls and systems. The Company’s Applied Water segment serves the primary uses of water and focuses on the residential, commercial, industrial and agricultural markets. The Company’s brands include Flygt, Wedeco, Godwin, Lowara, Flojet and Flowtronex.
