Philadelphia, Pennsylvania
September 24, 2009
BOENNING &
SCATTERGOOD, INC.
4 Tower Bridge
200 Barr Harbor Drive, Suite 300
West Conshohocken, PA 19428
J.J.B.
HILLIARD, W.L. LYONS, LLC
500 West Jefferson Street
Louisville, KY 40202
The
York Water Company, a Pennsylvania corporation (“York
Water”), proposes, subject to the terms and conditions stated
herein, to sell to Boenning & Scattergood, Inc. (the
“Representative”) and J.J.B. Hilliard, W.L. Lyons, LLC
(“Hilliard Lyons” and, together with the
Representative, the “Underwriters”), an aggregate of
950,000 shares of York Water’s Common Stock, with no par
value (“Common Stock”). The 950,000 shares of Common
Stock to be sold to the Underwriters by York Water are referred to
herein as the “Firm Shares.” The respective amounts of
the Firm Shares to be purchased by the several Underwriters are set
forth opposite their names in Schedule I hereto. The
Firm Shares shall be offered to the public at a public offering
price of $14.00 per Firm Share (the “Offering
Price”).
In
order to cover over-allotments in the sale of the Firm Shares, the
Underwriters may, at the Representative’s election and
subject to the terms and conditions stated herein, purchase ratably
in proportion to the amounts set forth opposite their respective
names in Schedule I hereto, for the Underwriters’
own accounts up to 142,500 additional shares of Common Stock from
York Water. Such 142,500 additional shares of Common Stock are
referred to herein as the “Optional Shares.” If any
Optional Shares are purchased, the Optional Shares shall be
purchased for offering to the public at the Offering Price and in
accordance with
the terms and
conditions set forth herein. The Firm Shares and the Optional
Shares are referred to collectively herein as the
“Shares.”
In
consideration of the mutual agreements contained herein, York Water
and the several Underwriters, intending to be legally bound, hereby
agree as follows:
1.
Representations and Warranties of York Water . York
Water represents and warrants to, and agrees with, the several
Underwriters that:
(a) York
Water has prepared and filed with the Securities and Exchange
Commission (the “SEC”), in accordance with the
provisions of the Securities Act of 1933, as amended (the
“Act”), and the rules and regulations thereunder (the
“Regulations”), a shelf registration statement on Form
S-3 (File No. 333-158837), which became effective as of
May 7, 2009, including a prospectus, registering the Shares.
The term “Registration Statement” as used herein means
the registration statement (including all exhibits and information
incorporated by reference therein), in the form on the most recent
effective date under the Act prior to the date hereof, and includes
information (if any) contained in a form of prospectus or
prospectus supplement that is deemed retroactively to be part of
the Registration Statement, pursuant to Rule 430B under the
Act, to be part of the registration statement as of the time
specified in Rule 430B. The term “Base Prospectus”
shall mean the base prospectus filed as part of the Registration
Statement in the form contained in the Registration Statement on
the most recent effective date of the Registration Statement under
the Act prior to the date hereof. The term “Preliminary
Prospectus” shall mean any preliminary prospectus supplement
relating to the Shares, together with the Base Prospectus, and
filed with the SEC pursuant to Rule 424(b) of the Regulations. The
term “Statutory Prospectus” shall mean the Preliminary
Prospectus, as amended or supplemented, immediately prior to the
Initial Sale Time (as defined below), including any document
incorporated by reference therein. The term
“Prospectus” shall mean the final prospectus supplement
relating to the Shares, together with the Base Prospectus, that is
first filed pursuant to Rule 424(b) on the date of this Agreement
or on the business day immediately following such date. The term
“Issuer Free Writing Prospectus” shall have the meaning
ascribed to it in Rule 433 of the Regulations relating to the
Shares, in the form filed or required to be filed with the SEC or,
if not required to be filed, in the form retained in York
Water’s records pursuant to Rule 433(g) of the Regulations.
The term “Disclosure Package” shall mean (i) the
Statutory Prospectus, (ii) the Issuer Free Writing Prospectus,
if any, identified in Part I of Schedule II
hereto, (iii) any other free writing prospectus defined in
Rule 405 of the Regulations that is required to be filed by
York Water with the SEC or retained by York Water under
Rule 433 of the Regulations and that all parties hereto
expressly agree to treat as part of the Disclosure Package (the
“Other Free Writing Prospectus”) and (iv) the
information included in Part II of Schedule II
hereto, all considered together. For purposes of this Agreement,
the “Initial Sale Time” shall mean 5:00 p.m. (Eastern
Time) on the date of this Agreement. All references in this
Agreement to the Registration Statement, the Base Prospectus, a
Preliminary Prospectus, the Statutory Prospectus, the Prospectus,
the Issuer Free Writing Prospectus, the Other Free Writing
Prospectus or any amendments or supplements to any of the
foregoing, shall include any copy thereof filed with the SEC
pursuant to its Interactive Data Electronic Applications
(“IDEA”) System.
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(b) The
Registration Statement has become effective under the Act, and the
SEC has not issued any stop order suspending the effectiveness of
the Registration Statement or preventing or suspending the use of
the Statutory Prospectus or the Prospectus, nor has the SEC
instituted or threatened to institute proceedings with respect to
such an order. No stop order suspending the sale of the Shares in
any jurisdiction designated by the Representative as provided for
in Section 5(f) of this Agreement has been issued, and
no proceedings for that purpose have been instituted or threatened.
York Water has complied in all material respects with all requests
of the SEC, or requests of which York Water has been advised of any
state or foreign securities commission in a state or foreign
jurisdiction designated by the Representative as provided for in
Section 5(f) of this Agreement, for additional
information to be included in the Registration Statement, the
Disclosure Package or the Prospectus.
(c) (i) The
Registration Statement complied at the time it most recently became
effective (the “Effective Time”) and, as amended or
supplemented, complies on the date hereof and will comply on the
Closing Date and any Option Closing Date, in all material respects,
with the requirements of the Act and the Regulations, (ii) the
Registration Statement, at the Effective Time, did not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, (iii) the Statutory
Prospectus, at the time it was filed, complied in all material
respects with the requirements of the Act and the Regulations,
(iv) the Statutory Prospectus, at the time it was filed, did
not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, (v) the Prospectus, at the time it is filed and,
as amended or supplemented, as of the Closing Date and any Option
Closing Date, complied and will comply in all material respects
with the requirements of the Act and the Regulations, (vi) the
Prospectus, at the time it is filed and, as amended or
supplemented, as of the Closing Date and any Option Closing Date,
will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided , however that the
representations and warranties set forth in this paragraph do not
apply to omissions from or statements in the Registration
Statement, the Statutory Prospectus or the Prospectus based upon
and in conformity with written information furnished to York Water
by the Underwriters specifically for use therein, it being
understood and agreed that the only information furnished by the
Underwriters for use in the Registration Statement, the Statutory
Prospectus or the Prospectus is the information as set forth in
Section 13 of this Agreement, and (vii) the
statistical and market-related data included or incorporated by
reference in the Registration Statement, the Disclosure Package and
the Prospectus are based on or derived from sources that York Water
believes to be reliable and accurate.
(d) The
Disclosure Package, at the Initial Sale Time, did not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading. The preceding sentence does not
apply to omissions from or statements in the Disclosure Package
based upon and in conformity with written information furnished to
York Water by the Underwriters specifically for use therein, it
being understood and agreed that the only such information
furnished by the Underwriters for use in the Disclosure Package is
the information as set forth in Section 13 of this
Agreement.
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(e) Prior
to the execution of this Agreement, York Water (including its
agents and representatives, other than the Underwriters in their
capacity as such) has not used, authorized, approved or referred to
and will not use, authorize, approve or refer to any Issuer Free
Writing Prospectus other than the documents listed in Part I
of Schedule II hereto. Each such Issuer Free Writing
Prospectus, as of its issuance and as of the Initial Sale Time,
complied in all material respects with the requirements of the Act
and the Regulations and has been filed in accordance with the Act
and the Regulations (to the extent required thereby). Each Issuer
Free Writing Prospectus, as of its issue date and at all subsequent
times through the completion of the public offer and sale of the
Shares or until any earlier date of which York Water notified or
notifies the Underwriters as described in the next sentence, did
not, does not and will not include any information that, in any
material respect, conflicted, conflicts or will conflict with the
information contained in the Registration Statement. If at any time
following issuance of an Issuer Free Writing Prospectus, there
occurred or occurs an event or development as a result of which
such Issuer Free Writing Prospectus conflicted or would conflict
with the information then contained in the Registration Statement
or included or would include an untrue statement of a material fact
or omitted or would omit to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances prevailing at that subsequent time, not misleading,
(i) York Water has promptly notified or will promptly notify
the Underwriters and (ii) York Water has promptly amended or will
promptly amend or supplement such Issuer Free Writing Prospectus to
eliminate or correct such conflict, untrue statement or omission.
The foregoing sentences do not apply to conflicts with, omissions
from or statements in any Issuer Free Writing Prospectus based upon
and in conformity with written information furnished to York Water
by the Underwriters specifically for use therein, it being
understood and agreed that the only such information furnished by
the Underwriters for use in any Issuer Free Writing Prospectus is
the information as set forth in Section 13 of this
Agreement.
(f) York
Water has not distributed and will not distribute, prior to the
later of the last Option Closing Date (as defined below) and the
completion of the Underwriters’ distribution of the Shares,
any offering material in connection with the offering and sale of
the Shares other than the Registration Statement, the Disclosure
Package or the Prospectus.
(g) The
documents incorporated by reference into the Prospectus pursuant to
Item 12 of Form S-3 under the Act, at the time they were filed
with the SEC, complied in all material respects with the
requirements of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”) and with the rules and regulations
promulgated under or pursuant to the Exchange Act, and did not
contain any untrue statement of material fact or omit to state a
material fact required to be stated therein, or necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading.
(h) There
are no legal or governmental proceedings pending or, to the
knowledge of York Water, threatened to which York Water is a party
or to which any of the properties of York Water are subject that
are required to be described in the Registration Statement, the
Statutory Prospectus or the Prospectus and are not so described or
any statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement, the
Statutory Prospectus or the Prospectus or to be filed as exhibits
to the Registration Statement that are not described or filed as
required.
4
(i) York
Water is a corporation duly organized, validly subsisting and in
good standing under the laws of the Commonwealth of Pennsylvania,
with all necessary corporate power and authority to own or lease
and operate its properties and to conduct its current business as
described in the Registration Statement, the Disclosure Package and
the Prospectus, and to execute, deliver and perform this Agreement.
York Water is not qualified as a foreign corporation in any
jurisdiction and is not required to be so qualified in order to
operate its business as now conducted or currently proposed to be
conducted.
(j) Except
for 25,510 shares of common stock of Columbia Water Company and 19
shares of common stock of Lodigan, Inc., York Water does not own
any stock or other interest whatsoever, whether equity or debt, in
any corporation, limited liability company, partnership or other
entity.
(k) This
Agreement has been duly authorized, executed and delivered by York
Water and constitutes its legal, valid and binding obligation,
enforceable against York Water in accordance with its terms, except
as enforcement may be limited by bankruptcy, insolvency or other
similar laws affecting the enforcement of creditors’ rights
generally and subject to applicability of general principles of
equity and except, as to this Agreement, as rights to indemnity and
contribution may be limited by federal and state securities laws or
principles of public policy.
(l) The
execution, delivery and performance of this Agreement and the
transactions contemplated herein, do not and will not, with or
without the giving of notice or the lapse of time, or both,
(i) conflict with any term or provision of York Water’s
Articles of Incorporation or Bylaws; (ii) result in a breach
of, constitute a default under, result in the termination or
modification of, result in the creation or imposition of any lien,
security interest, charge or encumbrance upon any of the properties
of York Water or require any payment by York Water or impose any
liability on York Water pursuant to, any contract, indenture,
mortgage, deed of trust, commitment or other agreement or
instrument to which York Water is a party or by which any of its
properties are bound or affected other than this Agreement;
(iii) assuming compliance with Blue Sky laws and the rules of
the Financial Industry Regulatory Authority (“FINRA”)
applicable to the offer and sale of the Shares, violate any law,
rule, regulation, judgment, order or decree of any government or
governmental agency, instrumentality or court, domestic or foreign,
having jurisdiction over York Water or any of its respective
properties or businesses; or (iv) result in a breach,
termination or lapse of York Water’s corporate power and
authority to own or lease and operate its properties and conduct
its business, except in the case of clauses (ii), (iii) and
(iv) above, as would not have a material adverse effect on the
management, assets, properties, condition (financial or otherwise),
shareholders’ equity or results of operations of the business
(collectively, the “Business Conditions”) of York
Water.
(m)
At the date or dates indicated in the Statutory Prospectus and the
Prospectus, York Water had or will have the capitalization set
forth in the Statutory Prospectus and the Prospectus under the
caption “Capitalization” and will have, as of the
issuance of the Firm Shares on the Closing Date, the as-adjusted
capitalization set forth therein as of the date indicated in the
Prospectus. At the Effective Time there were, and on the Closing
Date and any Option Closing Date there will be, no options or
warrants or other outstanding rights to purchase,
5
agreements or
obligations to issue or agreements or other rights to convert or
exchange any obligation or security into, capital stock of York
Water or securities convertible into or exchangeable for capital
stock of York Water, except as described in the Registration
Statement, the Disclosure Package or the Prospectus.
(n) The
currently outstanding shares of York Water’s capital stock
have been duly authorized and are validly issued, fully paid and
non-assessable, and none of such outstanding shares of York
Water’s capital stock has been issued in violation of any
preemptive rights of any security holder of York Water. The holders
of the outstanding shares of York Water’s capital stock are
not subject to personal liability solely by reason of being such
holders. All previous offers and sales of the outstanding shares of
York Water’s capital stock, whether described in the
Registration Statement, the Disclosure Package or the Prospectus
were made in conformity with applicable federal, state and foreign
securities laws. The authorized capital stock of York Water,
including, without limitation, the outstanding Common Stock and the
Shares being issued, conform in all material respects with the
descriptions thereof in the Registration Statement, the Statutory
Prospectus and the Prospectus, and such descriptions conform in all
material respects with the instruments defining the
same.
(o) There
are no contracts, agreements or understandings between York Water
and any person granting such person the right to require York Water
to file a registration statement under the Act with respect to any
securities of York Water owned or to be owned by such person or to
require York Water to include such securities in the securities
registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by York Water under the Act.
(p) The
Shares have been duly and validly authorized, and, when issued and
delivered against payment therefor as contemplated by this
Agreement, the Shares will be validly issued, fully paid and
non-assessable, and the holders thereof will not be subject to
personal liability solely by reason of being such holders. The
certificates representing the Shares are in proper legal form
under, and conform in all respects to the requirements of, the
Pennsylvania Business Corporation Law of 1988, as amended (the
“PBCL”). Neither the filing of the Registration
Statement or the Prospectus nor the offering or sale of Shares as
contemplated by this Agreement gives any security holder of York
Water any rights for or relating to the registration of any Common
Stock or any other capital stock of York Water or any rights to
convert or have redeemed or otherwise receive anything of value
with respect to any other security of York Water.
(q) No
consent, approval, authorization, order, registration, license or
permit of, or filing or registration with, any court, government,
governmental agency, instrumentality or other regulatory body or
official is required for the valid and legal execution, delivery
and performance by York Water of this Agreement and the
consummation of the transactions contemplated hereby except
(i) issuance of a securities certificate by the Pennsylvania
Public Utilities Commission, which has been issued, (ii) such
as may be required for the registration of the Shares under the
Act, the listing of the Shares on the NASDAQ Global Select Market,
(iii) filings under the Exchange Act, and (iv) filings
required for compliance with the applicable state securities or
Blue Sky laws or the Bylaws, rules and other pronouncements of
FINRA.
6
(r) The
Common Stock (including the Shares) is registered pursuant to
Section 12(g) of the Exchange Act. The issued and outstanding
shares of Common Stock are listed on the NASDAQ Global Select
Market. Neither York Water nor, to York Water’s knowledge,
any other person has taken any action designed to cause, or likely
to result in, the termination of the registration of the Common
Stock under the Exchange Act. York Water has not received any
notification that the SEC or FINRA is contemplating terminating
such registration or inclusion.
(s) The
statements in the Registration Statement, the Disclosure Package
and the Prospectus, insofar as they are descriptions of or
references to contracts, agreements or other documents, are
accurate in all material respects and present or summarize fairly,
in all material respects, the information required to be disclosed
under the Act or the Regulations, and there are no contracts,
agreements or other documents, instruments or transactions of any
character required to be described or referred to in the
Registration Statement, the Statutory Prospectus or the Prospectus
or to be filed as exhibits to the Registration Statement that have
not been so described, referred to or filed, as
required.
(t) Each
contract or other instrument (however characterized or described)
to which York Water is a party or by which any of its properties or
businesses is bound or affected and which is material to the
conduct of York Water’s business has been duly and validly
executed by York Water and, to the knowledge of York Water, has
been duly and validly executed by the other parties thereto. To the
knowledge of York Water, each such contract or other instrument is
in full force and effect. York Water has not received written
notice from the other parties to such contracts of their intent to
suspend or terminate the services being provided. To the knowledge
of York Water, no other party is in default thereunder, and no
event has occurred that, with the lapse of time or the giving of
notice, or both, would constitute a default by such party under any
such contract or other instrument, except for defaults that would
not have a material adverse effect on the Business Conditions of
York Water. All necessary consents under such contracts or other
instruments to the disclosure in the Registration Statement, the
Disclosure Package or the Prospectus with respect thereto have been
obtained.
(u) The
financial statements of York Water (including the notes thereto)
filed as part of or incorporated by reference in, the Registration
Statement, the Statutory Prospectus and the Prospectus present
fairly, in all material respects, the financial position of York
Water as of the respective dates thereof, and the results of
operations and cash flows of York Water for the periods indicated
therein, and have been prepared in conformity with generally
accepted accounting principles, except as described therein. The
financial information included in the Statutory Prospectus or the
Prospectus under the captions “Prospectus Supplement Summary
— Summary Financial Information,” “Use of
Proceeds” and “Capitalization” presents fairly
the information shown therein and has been compiled on a basis
consistent with that of the financial statements included in the
Registration Statement, the Statutory Prospectus and the
Prospectus.
(v)
Since the respective dates as of which information is given, or
incorporated by reference, in the Registration Statement, the
Statutory Prospectus and the Prospectus, except as otherwise stated
therein, there has not been (i) any material adverse change,
or development involving a prospective material adverse change
(including, whether or
7
not insured
against, any loss or damage to any assets that would constitute a
material adverse change), in the Business Conditions of York Water;
(ii) any material adverse change, loss, reduction, termination or
non-renewal of any contract to which York Water is a party that is
material to the conduct of York Water’s business;
(iii) any transaction entered into by York Water not in the
ordinary course of its business that is material to York Water;
(iv) any dividend or distribution of any kind declared, paid
or made by York Water on its capital stock, except for and to the
extent described in the Registration Statement, the Disclosure
Package and the Prospectus; (v) any liabilities or
obligations, direct or indirect, incurred by York Water that are
material to York Water; (vi) any change in the capitalization
of York Water, except for issuances pursuant to York Water’s
Dividend Reinvestment and Direct Stock Purchase Plan or Employee
Stock Purchase Plan; or (vii) any change in the indebtedness
of York Water that is material to York Water. York Water has no
contingent liabilities or obligations that are material and that
are not expressly disclosed in the Registration Statement, the
Disclosure Package or the Prospectus.
(w) Neither
York Water nor, to York Water’s knowledge, any of its
officers, directors or affiliates has (i) taken, nor shall
York Water or such persons take, directly or indirectly, (A) any
action designed to, or that might be reasonably expected to, cause
or result in stabilization or manipulation of the price of the
Common Stock or any other “reference security” (as
defined in Rule 100 of Regulation M under the 1934 Act
(“Regulation M”)) whether to facilitate the sale
or resale of the Shares or otherwise, or (B) any action which
would directly or indirectly violate Regulation M, or
(ii) since the filing of the Registration Statement
(A) sold, bid for, purchased or paid anyone any compensation
for soliciting purchases of, the Shares or (B) paid or agreed
to pay to any person any compensation for soliciting another to
purchase any other securities of York Water.
(x) York
Water has filed with the appropriate federal, state and local
governmental agencies, and all foreign countries and political
subdivisions thereof, all material tax returns that are required to
be filed or have duly obtained extensions of time for the filing
thereof and have paid all material taxes shown on such returns or
otherwise due and all material assessments received by them to the
extent that the same have become due, other than those which York
Water is contesting in good faith. York Water has not executed or
filed with any taxing authority, foreign or domestic, any agreement
extending the period for assessment or collection of any income or
other tax and is not a party to any pending action or proceeding by
any foreign or domestic governmental agency for the assessment or
collection of taxes, and no claims for assessment or collection of
taxes have been asserted against York Water that would materially
adversely affect the Business Conditions of York Water.
(y) Beard
Miller Company LLP, which has given its report on certain financial
statements included as part of, or incorporated by reference in,
the Registration Statement, the Statutory Prospectus and the
Prospectus is a firm of independent certified public accountants as
required by the Act and the Regulations with respect to York
Water.
(z) York
Water is not in violation of, or in default under, any of the terms
or provisions of (i) its Articles of Incorporation or Bylaws
or similar governing instruments, (ii) any indenture,
mortgage, deed of trust, contract, commitment or other agreement or
instrument to which it is a party or by which it or any of its
assets or properties is bound or affected, (iii) any law,
rule, regulation, judgment, order or decree of any government or
governmental agency,
8
instrumentality
or court, domestic or foreign, having jurisdiction over it or any
of its properties or business, or (iv) any license, permit,
certification, registration, approval, consent or franchise, except
with respect to clause (ii), (iii) or (iv) above, where
any such default would not reasonably be expected to have a
material adverse effect on the Business Conditions of York
Water.
(aa) Except
as expressly disclosed in the Registration Statement, the
Disclosure Package or the Prospectus, there are no claims, actions,
suits, protests, proceedings, arbitrations, investigations or
inquiries pending before, or, to York Water’s knowledge,
threatened or contemplated by, any governmental agency,
instrumentality, court or tribunal, domestic or foreign, or before
any private arbitration tribunal to which York Water is or may be
made a party that could reasonably be expected to affect the
validity of any of the outstanding Common Stock, or that, if
determined adversely to York Water would have a material adverse
effect on the Business Conditions of York Water, nor to York
Water’s knowledge is there any reasonable basis for any such
claim, action, suit, protest, proceeding, arbitration,
investigation or inquiry. There are no outstanding orders,
judgments or decrees of any court, governmental agency,
instrumentality or other tribunal enjoining York Water from, or
requiring York Water to take or refrain from taking, any action, or
to which York Water or their properties, assets or businesses are
bound or subject.
(bb) York
Water owns, or possesses adequate rights to use, all patents,
patent applications, trademarks, trademark registrations,
applications for trademark registration, trade names, service
marks, licenses, inventions, copyrights, know-how (including any
unpatented and/or unpatentable proprietary or confidential
technology, information, systems, design methodologies and devices
or procedures developed or derived from or for York Water’s
business), trade secrets, confidential information, processes and
formulations and other proprietary information necessary for, used
in, or proposed to be used in, the conduct of the business of York
Water as described in the Registration Statement, the Disclosure
Package and the Prospectus (collectively, the “Intellectual
Property”), except failures to own or possess rights to use
that would not have a material adverse effect on the Business
Conditions of York Water. To York Water’s knowledge, York
Water has not infringed, is not infringing nor has received any
notice of conflict with, the asserted rights of others with respect
to the Intellectual Property that, individually or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would materially adversely affect the Business Conditions
of York Water, and York Water knows of no reasonable basis
therefor. To the knowledge of York Water, no other parties have
infringed upon or are in conflict with any Intellectual Property.
York Water is not a party to, or bound by, any agreement pursuant
to which royalties, honorariums or fees are payable by York Water
to any person by reason of the ownership or use of any Intellectual
Property, except for such royalties, honorariums or fees associated
with commercially available software and computer
applications.
(cc)
York Water has good and marketable title to all property described
in the Registration Statement, the Disclosure Package and the
Prospectus as being owned by it, free and clear of all liens,
security interests, charges or encumbrances and the like, except
such as are expressly described or referred to in the Prospectus or
such as do not materially adversely affect the Business Conditions
or the conduct of the business of York Water as described in the
Registration Statement, the Disclosure Package and the Prospectus.
York Water has insured its property against loss or damage by fire
or other casualty, in amounts reasonably believed by
9
York Water to
be adequate, and maintains insurance against such other risks as
management of York Water deems appropriate. All real and personal
property leased by York Water, as described or referred to in the
Prospectus, is held by York Water, under valid leases. The
executive offices and facilities of York Water (the
“Premises”), and all operations presently or formerly
conducted thereon by York Water or any predecessors thereof, are
now and, since York Water began to use such Premises, always have
been in compliance with all federal, state and local statutes,
ordinances, regulations, rules, standards and requirements of
common law concerning or relating to industrial hygiene and the
protection of health and the environment (collectively, the
“Environmental Laws”), except to the extent that any
failure in such compliance would not materially adversely affect
the Business Conditions of York Water. To the knowledge of York
Water, the facilities of York Water produce water of sufficient
quality and quantity to supply the current and planned customers
and service areas of York Water, and are not subject to any
restriction on surface water withdrawal under any federal, state or
local law, regulation, rule, order or permit, except as expressly
described in the Registration Statement, the Disclosure Package and
the Prospectus or as provided in the Commonwealth of Pennsylvania
allocation permits and such as do not materially adversely affect
the Business Conditions or the conduct of the business of York
Water as described in the Prospectus. To the knowledge of York
Water, there are no conditions on, about, beneath or arising from
the Premises or in close proximity to the Premises that
(i) might give rise to liability, the imposition of a
statutory lien upon York Water, (ii) require a
“Response,” “Removal” or “Remedial
Action,” as defined herein, under any of the Environmental
Laws by York Water or (iii) affect the quality of the surface
water withdrawn by York Water, and that in any such case described
in (i), (ii) or (iii) would materially adversely affect
the Business Conditions of York Water, except as described in the
Registration Statement, Statutory Prospectus or the Prospectus.
Except as expressly disclosed in the Registration Statement,
Statutory Prospectus or the Prospectus, or as will not materially
adversely affect the Business Conditions of York Water
(i) York Water has not received notice or has knowledge of any
claim, demand, investigation, regulatory action, suit or other
action instituted or threatened against York Water or any portion
of the Premises relating to any of the Environmental Laws and
(ii) York Water has not received any notice of material
violation, citation, complaint, order, directive, request for
information or response thereto, notice letter, demand letter or
compliance schedule to or from any governmental or regulatory
agency arising out of or in connection with “hazardous
substances” (as defined by applicable Environmental Laws) on,
about, beneath, arising from or generated at the Premises. As used
in this subsection, the terms “Response,”
“Removal” and “Remedial Action” shall have
the respective meanings assigned to such terms under
Sections 101(23)-101(25) of the Comprehensive Environmental
Response, Compensation and Liability Act, as amended by the
Superfund Amendments and Reauthorization Act, 42 U.S.C.
9601(23)-9601(25).
(dd) York
Water maintains a system of internal accounting controls sufficient
to provide reasonable assurances that: (i) transactions are
executed in accordance with management’s general or specific
authorization; (ii) transactions are recorded as necessary in
order to permit preparation of financial statements in accordance
with generally accepted accounting principles and to maintain
accountability for assets; (iii) access to assets is permitted
only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any
differences.
10
(ee) York
Water is in compliance in all material respects with all currently
effective provisions of the Sarbanes-Oxley Act of 2002 and the
rules and regulations promulgated thereunder that are applicable,
or will be applicable as of the Closing Date, to York
Water.
(ff) York
Water and any Related Employer (which for purposes of this
Section 1(ff) means any entity that with York Water is
a member of a controlled group of corporations within the meaning
of Section 414(b) of the Internal Revenue Code of 1986, as amended
(the “Code”), is, individually or collectively, a trade
or business under common control within the meaning of Section
414(c) of the Code, or is a member of the same affiliated service
group within the meaning of Section 414(m) of the Code) have
established, maintain, contribute to, are required to contribute
to, are a party to, or are bound by certain pension, retirement,
profit-sharing plans, deferred compensation, bonus, or other
incentive plans, or medical, vision, dental, or other health plans,
or life insurance or disability plans, or any other employee
benefit plans, programs, arrangements, agreements, or
understandings, some of which are subject to the Employee
Retirement Income Security Act of 1974, as amended
(“ERISA”) and the rules and regulations thereunder
(“Plans”). Any disclosure regarding the Plans required
under the Act or the Exchange Act has been made in the Registration
Statement, the Disclosure Package or the Prospectus and the
documents incorporated therein. All Plans that are subject to ERISA
are in compliance with ERISA, in all material respects, and, to the
extent a Plan is intended to be tax-qualified within the meaning of
Section 401(a) of the Code, such Plan is in compliance with the
Code in all material respects and is the subject of a current
favorable determination letter from the Internal Revenue Service as
to its tax qualification. No Plan is an employee pension benefit
plan that is subject to Part 3 of Subtitle B of Title I of
ERISA, a defined benefit plan subject to Title IV of ERISA, or a
multiemployer plan. Neither York Water nor any Related Employer
maintains or has maintained retiree life or retiree health
insurance plans that are employee welfare benefit plans providing
for continuing benefit or coverage for any employee or any
beneficiary of any employee after such employee’s termination
of employment, except as required by Section 4980B of the Code
and except as disclosed in the Registration Statement, the
Disclosure Package or the Prospectus. No fiduciary or other party
in interest with respect to any of the Plans has caused any of such
Plans to engage in a prohibited transaction as defined in
Section 406 of ERISA and Section 4975 of the Code. As
used in this subsection, the terms “defined benefit
plan,” “employee benefit plan,” “employee
pension benefit plan,” “employee welfare benefit
plan,” “fiduciary” and “multiemployer
plan” shall have the respective meanings assigned to such
terms in Section 3 of ERISA.
(gg) No
labor dispute exists with York Water’s employees, and to York
Water’s knowledge, no such labor dispute is threatened. York
Water has no knowledge of any existing or threatened labor
disturbance by the employees of any of the principal suppliers,
contractors or customers of York Water that would materially
adversely affect the Business Conditions of York Water.
(hh)
There are no contracts, agreements or understandings between York
Water and/or any person that would give rise to a valid claim
against York Water and/or the Underwriters for a brokerage
commission, finder’s fee or other like payment in connection
with the transactions contemplated herein, the Registration
Statement, the Disclosure Package and the Prospectus, or in any
contracts, agreements, understandings, payments, arrangements
or
11
issuances with
respect to York Water or, to the knowledge of York Water, any of
its officers, directors, stockholders, employees or affiliates that
may affect any Underwriter’s compensation as determined by
FINRA.
(ii) York
Water is not, and after giving effect to the offering and sale of
the Shares and the application of the proceeds therefor described
in the Registration Statement, the Disclosure Package and the
Prospectus will not be an “investment company” or an
entity “controlled” by an “investment
company,” as such terms are defined in the Investment Company
Act of 1940, as amended.
(jj) York
Water has received all permits, licenses, franchises,
authorizations, registrations, qualifications and approvals
(collectively, “Permits”) of governmental or regulatory
authorities as may be required to own its properties and conduct
its businesses in the manner described in the Registration
Statement, the Disclosure Package and the Prospectus, subject to
such qualifications as may be set forth in the Registration
Statement, the Disclosure Package or the Prospectus, except for
failures to have Permits that would have a material adverse effect
on the Business Conditions of York Water; and York Water has
fulfilled and performed all of its material obligations with
respect to such Permits, and no event has occurred which allows or,
after notice or lapse of time or both, would allow revocation or
termination thereof or result in any other material impairment of
the rights of the holder of any such Permit, subject in each case
to such qualifications as may be set forth in the Registration
Statement, the Disclosure Package or the Prospectus except for
revocations, terminations or impairments that would not have a
material adverse effect on the Business Conditions of York Water;
and, except as described in the Registration Statement, the
Disclosure Package or the Prospectus, such Permits contain no
restrictions that materially affect the ability of York Water to
conduct its businesses.
(kk) No
transaction has occurred or is proposed between or among York Water
and any of its officers, directors or stockholders or any affiliate
of the foregoing, that is required to be described in and is not
described in the Registration Statement, the Statutory Prospectus
or the Prospectus.
(ll) Neither
York Water nor any officer, director, employee, partner, agent or
other person acting on behalf of York Water has, directly or
indirectly, given or agreed to give any money, property or similar
benefit or consideration to any customer or supplier (including any
employee or agent of any customer or supplier) or official or
employee of any agency or instrumentality of any government
(foreign or domestic) or political party or candidate for office
(foreign or domestic) or any other person who was, is or in the
future may be in a position to affect the Business Conditions of
York Water or any actual or proposed business transaction of York
Water that (i) could subject York Water to any liability
(including, but not limited to, the payment of monetary damages) or
penalty in any civil, criminal or governmental action or proceeding
that would have a material adverse effect on the Business
Conditions of York Water or (ii) with respect to York Water,
or any officer or director thereof, violates any law, rule or
regulation to which York Water is subject.
(mm)
York Water’s board of directors has validly appointed an
audit committee whose composition satisfies the requirements of the
Exchange Act, the rules and regulations of the SEC adopted
thereunder and Nasdaq Listing Rule 5605 that are applicable as
of the Closing
12
Date. York
Water’s audit committee has adopted a charter that satisfies
the Exchange Act, the rules and regulations of the SEC adopted
thereunder and Nasdaq Listing Rule 5605 that are applicable as
of the Closing Date.
(nn) At
the time of filing the Registration Statement and as of the date of
the execution and delivery of this Agreement (with each such date
being used as the determination date for purposes hereof), York
Water was not and is not an Ineligible Issuer (as defined in
Rule 405 of the Act), without taking account of any
determination by the SEC pursuant to Rule 405 of the Act that
it is not necessary that York Water be considered an Ineligible
Issuer.
(oo) Any
certificate signed by any officer of York Water in such capacity
and delivered to the Underwriters or to counsel for the
Underwriters pursuant to this Agreement shall be deemed a
representation and warranty by York Water to the Underwriters as to
the matters covered therein.
(pp) As
of the date of this Agreement, at the time the Registration
Statement was originally declared effective and at the time York
Water’s Annual Report on Form 10-K for the year ended
December 31, 2008 (the “Annual Report”) was filed
with the SEC, York Water met the then applicable requirements for
use of Form S-3 under the Securities Act. As of the date of this
Agreement and at the time the Registration Statement was filed,
York Water also met the requirements for use of the Form S-3 under
the Securities Act that were in effect prior to October 21,
1992.
2.
Purchase and Sale of Firm Shares . On the basis of
the representations, warranties, covenants and agreements contained
herein, but subject to the terms and conditions set forth herein,
York Water shall sell the Firm Shares to the several Underwriters
at the Offering Price less the Underwriting Discounts and
Commissions shown on the cover page of the Prospectus, and the
Underwriters, severally and not jointly, shall purchase from York
Water on a firm commitment basis the respective amounts of the Firm
Shares set forth opposite their names on Schedule I ,
at the Offering Price less the Underwriting Discounts and
Commissions shown on the cover page of the Prospectus. In making
this Agreement, each Underwriter is contracting severally and not
jointly, and except as provided in Sections 4 and
12 hereof, the agreement of each Underwriter is to purchase
only that number of Shares specified with respect to that
Underwriter in Schedule I hereto. The Underwriters
shall offer the Shares to the public as set forth in the
Prospectus.
3. Payment
and Delivery . The Firm Shares shall be issued in the form
of one or more fully registered global securities (the
“Global Securities”) in book-entry form in such
denominations and registered in the name of the nominee of The
Depository Trust Company (“DTC”) or in such names as
the Underwriters may request upon at least 48 hours’ prior
notice to York Water and shall be delivered by or on behalf of York
Water through the facilities of DTC for the account of each
Underwriter against payment by such Underwriter on its behalf of
the purchase price therefor by wire transfer of immediately
available funds to such accounts as York Water shall designate in
writing (with all costs and expenses incurred by the Underwriters
in connection with such settlement in immediately available funds,
including, but not limited to, interest or cost of funds and
expenses, to be borne by York Water). The closing of the sale and
purchase of the Firm Shares shall be held at the offices of Ballard
Spahr LLP, 1735 Market
13
Street,
Philadelphia, Pennsylvania for the respective accounts of the
Underwriters. Such payment and delivery will be made at
10:00 a.m., Philadelphia, Pennsylvania time, on the third
business day after the date of this Agreement or at such other time
on the same or such other date as shall be agreed upon by York
Water and the Representative. Such time and date are referred to
herein as the “Closing Date.”
4.
Option to Purchase Optional Shares .
(a) For
the purposes of covering any over-allotments in connection with the
distribution and sale of the Firm Shares as contemplated by the
Prospectus, subject to the terms and conditions herein set forth,
the several Underwriters are hereby granted an option by York Water
to purchase all or any part of the Optional Shares (the
“Over-allotment Option”). The purchase price to be paid
for the Optional Shares shall be the Offering Price less the
Underwriting Discounts and Commissions shown on the cover page of
the Prospectus. The Over-allotment Option granted hereby may be
exercised by the Representative on behalf of the several
Underwriters as to all or any part of the Optional Shares at any
time and from time to time within 30 days after the date of
the Prospectus. No Underwriter shall be under any obligation to
purchase any Optional Shares prior to an exercise of the
Over-allotment Option.
(b) The
Over-allotment Option granted hereby may be exercised by the
Representative on behalf of the several Underwriters by giving
notice to York Wa
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