8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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 19, 2018

EVOQUA WATER TECHNOLOGIES CORP.

(Exact name of registrant as specified in its charter)

Delaware	001-38272	46-4132761
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)

210 Sixth Avenue Pittsburgh, Pennsylvania	15222
(Address of principal executive offices)	(Zip code)

Registrant’s telephone number, including area code: (724) 772-0044

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c))

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Item 1.01. Entry Into a Material Definitive Agreement.

On June 19, 2018, EWT Holdings III Corp. (“EWT III”), an indirect wholly-owned subsidiary of Evoqua Water Technologies Corp. (the “Company”), entered into a Stock Purchase Agreement (the “Agreement”) by and among ProAct Services Corporation (“ProAct”), the equity holders of ProAct, Hammond, Kennedy, Whitney & Company, Inc. (solely in its capacity as the Sellers’ Representative under the Agreement) and EWT III, pursuant to which EWT III agreed to purchase all of the issued and outstanding equity securities of ProAct (the “Transaction”). The aggregate purchase price payable under the Agreement is $132 million, payable in cash at closing of the Transaction, subject to customary adjustments, including for working capital. The Transaction is subject to customary closing conditions, including review by the Department of Justice and the Federal Trade Commission in accordance with the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The Company intends to finance the Transaction using an incremental $150 million term loan under its First Lien Credit Agreement, dated January 15, 2014, as amended. The foregoing description of the Agreement and the incremental term loan are qualified entirely by reference to the relevant documents, copies of which will be filed as exhibits to one of the Company’s subsequent filings under the Securities Exchange Act of 1934, as amended.

Item 7.01. Regulation FD Disclosure.

On June 20, 2018, the Company issued a press release, a copy of which is furnished as Exhibit 99.1 hereto and incorporated herein by reference, announcing the Company’s execution of the Agreement.

The slide presentation furnished as Exhibit 99.2 hereto and incorporated herein by reference may be used by the Company in various presentations to investors and analysts in connection with the Transaction.

In accordance with General Instruction B.2 of Form 8-K, the information in this Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1 and Exhibit 99.2 attached hereto, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits:

Exhibit No.	Description
99.1	Press Release of Evoqua Water Technologies Corp. dated June 20, 2018
99.2	Overview of Pending ProAct Acquisition

SIGNATURES

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.

Date: June 20, 2018		EVOQUA WATER TECHNOLOGIES CORP.
	By:	/s/ Benedict J. Stas
		Benedict J. Stas
		Chief Financial Officer

EX-99.1

EVOQUA AGREES TO ACQUIRE PROACT SERVICES,

LEADING PROVIDER OF ENVIRONMENTAL TREATMENT SOLUTIONS AND SERVICES

Pittsburgh, PA – June 20, 2018 – Evoqua Water Technologies Corp. (NYSE: AQUA) today announced one of its wholly-owned subsidiaries has signed a definitive agreement to purchase ProAct Services Corporation (“ProAct Services”), a provider of on-site treatment services of contaminated water in all 50 states from private equity firm Hammond, Kennedy, Whitney & Company Inc. and members of management, for $132 million. Upon closing, ProAct Services will operate as a separate division within Evoqua’s Industrial Segment and will continue to be based in Ludington, Michigan. The transaction is expected to close upon receipt of required regulatory approvals and satisfaction of customary closing conditions.

ProAct Services, which has revenues of approximately $54 million and historical adjusted EBITDA of approximately $12 million (for the twelve months ended, March 31, 2018), provides an array of expanded offerings for Evoqua across its existing environmental solutions and enhances Evoqua’s service capabilities in mobile/temporary process water and wastewater treatment, hydrostatic water treatment, and coal ash pond remediation.

The company combines engineering expertise with in-field service technicians and a proprietary fleet of modular equipment. It provides customized, on-site groundwater and soil treatment solutions, hydrostatic water treatment and tank degassing solutions to customers including 24 / 7 oversight, maintenance and general operations of the systems. ProAct Services has approximately 180 employees, a nationwide service footprint and facilities in California, Florida, Michigan, Minnesota, New Jersey, Virginia and Texas. Evoqua expects to achieve synergies following the close of the transaction.

“ProAct Services has a well-earned reputation for safety, exceptional service, and a commitment to customer satisfaction. The addition of their 900 mobile assets using remote-monitoring technology enhances Evoqua’s ability to be a ‘one-stop shop’ for customers that are looking for temporary and mobile water treatment solutions,” said Ron Keating, Evoqua Chief Executive Officer. “In addition, ProAct will expand our portfolio offerings as we service our industrial customers’ needs across a complete line of environmental solutions.”

“We look forward to welcoming the ProAct team to Evoqua and to growing together by delivering a broader set of solutions to our customers as the premier outsourced water services provider,” added Keating.

“We are enthusiastic to join the Evoqua team,” said ProAct Services’ CEO Gerard Smiddy. “Not only are our businesses complementary, but so is Evoqua’s commitment to safety, growth, and helping its customers and partners to succeed.”

Evoqua intends to finance the acquisition using an incremental $150 million first lien term loan. The funds will be used to support this transaction, as well as to replenish the internally funded purchases of two recent acquisitions, and for general corporate purposes. Pro forma net leverage is expected to be approximately 3.6x following the transaction and financing.

About Evoqua

Evoqua Water Technologies is a leading provider of mission critical water treatment solutions, offering services, systems and technologies to support its customers’ full water lifecycle needs. Evoqua Water Technologies has worked to protect water, the environment and its employees for more than 100 years, earning a reputation for quality, safety and reliability around the world. Headquartered in Pittsburgh, Pennsylvania, Evoqua operates 160 locations in eight countries and, with over 200,000 installations and 87 service branches, is a leader in North American industrial, commercial and municipal water treatment, serving more than 38,000 customers worldwide.

Forward-Looking Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All of these forward-looking statements are based on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements, or could affect our share price. Factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include among other things, those described in the “Risk Factors” section in our Annual Report on Form 10-K for the fiscal year ended September 30, 2017, as filed with the SEC December 4, 2017, and in other periodic reports we file with the SEC. Additionally, any forward-looking statements made in this press release speak only as of the date of this release. We undertake no obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements made herein, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this release.

Contacts:

Media                        Investors

Kevin G. Lowery                Dan Brailer

724-772-1527 (office)                724-720-1605 (office)

724-719-1475 (mobile)                (412) 977-2605    (mobile)

kevin.lowery@evoqua.comdan.brailer@evoqua.com

EX-99.2

Overview of Pending ProAct Acquisition June 20, 2018 TRANSFORMING WATER. ENRICHING LIFE.TM ©2017©2018 Evoqua Water Technologies

Forward-looking statement safe harbor This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All of these forward-looking statements are based on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements, or could affect our share price. Some of the factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include among other things, general global economic and business conditions including changes in commodity pricing; our ability to compete successfully in our markets; our ability to continue to develop or acquire new products, services and solutions and adapt our business to meet the demands of our customers, comply with changes to government regulations and achieve market acceptance with acceptable margins; our ability to implement our growth strategy, including acquisitions and our ability to identify suitable acquisition targets; our ability to operate or integrate any acquired businesses, assets or product lines profitably or otherwise successfully implement our growth strategy; delays in enactment or repeals of environmental laws and regulations; the potential for us to become subject to claims relating to handling, storage, release or disposal of hazardous materials; risks associated with product defects and unanticipated or improper use of our products; the potential for us to incur liabilities to customers as a result of warranty claims or failure to meet performance guarantees; our ability to meet our customers’ safety standards or the potential for adverse publicity affecting our reputation as a result of incidents such as workplace accidents, mechanical failures, spills, uncontrolled discharges, damage to customer or third-party property or the transmission of contaminants or diseases; litigation, regulatory or enforcement actions and reputational risk as a result of the nature of our business or our participation in large-scale projects; seasonality of sales and weather conditions; risks related to government customers, including potential challenges to our government contracts or our eligibility to serve government customers; the potential for our contracts with federal, state and local governments to be terminated or adversely modified prior to completion; risks related to foreign, federal, state and local environmental, health and safety laws and regulations and the costs associated therewith; risks associated with international sales and operations, including our operations in China; our ability to adequately protect our intellectual property from third-party infringement; our increasing dependence on the continuous and reliable operation of our information technology systems; risks related to our substantial indebtedness; our need for a significant amount of cash, which depends on many factors beyond our control; AEA’s influence over us; and other factors described in the “Risk Factors” and Management Discussion & Analysis sections in our Annual Report on Form 10-K for the fiscal year ended September 30, 2017, as updated by subsequent reports we file pursuant to the Securities Exchange Act of 1934. All statements other than statements of historical fact included in the presentation are forward-looking statements including, but not limited to, expected financial outlook for fiscal 2018. Any forward-looking statement that we make in this presentation speaks only as of June 20, 2018. We undertake no obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements made herein, whether as a result of new information, future events or otherwise. Use of Non-GAAP Financial Measures - This presentation contains “non-GAAP financial measures,” which are adjusted financial measures that are not calculated and presented in accordance with generally accepted accounting principles in the United States, or “GAAP.” These non-GAAP adjusted financial measures are provided as additional information for investors. We believe these non-GAAP adjusted financial measures, such as Adjusted EBITDA and free cash flow, are helpful to management and investors in highlighting trends in our operating results, because they exclude, among other things, certain results of decisions that are outside the control of management, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. The presentation of this additional information is not meant to be considered in isolation or as a substitute for GAAP measures of net income (loss), or net cash provided by (used in) operating activities prepared in accordance with GAAP. For reconciliations of the non-GAAP adjusted financial measures used in this presentation to the nearest respective GAAP measures, see the Appendix to this presentation. Page 2

ProAct: a strategic fit for Evoqua ProAct Key Facts Strategic Rationale • $132 million purchase price • Industrial service focused platform providing • ~$54 million March 2018 LTM revenue nationwide network and capabilities • ~$12 million March 2018 LTM historical adjusted • Enhances Evoqua's mobile process water treatment EBITDA(1) offering to include wastewater treatment and • Headquartered in Ludington, MI remediation • Eight U.S. Locations ◦ Evoqua becomes a "one stop shop" for temporary water treatment solutions with ProAct's 900 mobile assets ◦ Expanded service offerings (1) Such information provided by ProAct management ◦ Leveragable branch network ◦ Synergies Evoqua Financing / Capital Structure Service Overview • $150 million add on to existing First Lien Term Loan • Waste water treatment due 2024 ◦ Mobile groundwater and soil treatment solutions • Use of funds • Hydrostatic water treatment ◦ Fund ProAct acquisition ◦ Wastewater treatment systems ◦ Replenish internally funded purchase price of • Tank degassing Pure Water and Pacific Ozone acquisitions ◦ Remove residual organic gases from storage ◦ General corporate purposes tanks to meet air standards • Management continuously evaluates our capital • Potable water structure, including optimal debt levels, structure and floating/fixed interest rate mix ◦ Provide short-term drinking water treatment solutions • ~3.6x net pro forma leverage expected post transaction; ~3.8x inclusive of capital leases Page 3

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