-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, N7n7rYUeNqQ8mQ22t5AiYmvUH93mgRvA009zq6wZMwkxBdvETasG16+yF4q5TihR RO5zCJxGGcYj/BWPZoB2zA== 0000950132-96-000420.txt : 19960709 0000950132-96-000420.hdr.sgml : 19960709 ACCESSION NUMBER: 0000950132-96-000420 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 19960708 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED STATES FILTER CORP CENTRAL INDEX KEY: 0000318025 STANDARD INDUSTRIAL CLASSIFICATION: REFRIGERATION & SERVICE INDUSTRY MACHINERY [3580] IRS NUMBER: 330266015 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-07759 FILM NUMBER: 96591982 BUSINESS ADDRESS: STREET 1: 73 710 FRED WARING DR STE 222 CITY: PALM DESERT STATE: CA ZIP: 92260 BUSINESS PHONE: 6193400098 MAIL ADDRESS: STREET 1: 73 710 FRED WARING DRIVE SUITE 222 CITY: PALM DESERT STATE: CA ZIP: 92260 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN TOXXIC CONTROL INC DATE OF NAME CHANGE: 19910401 FORMER COMPANY: FORMER CONFORMED NAME: NOVAN ENERGY INC DATE OF NAME CHANGE: 19871227 S-3 1 FORM S-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 8, 1996 REGISTRATION NO. 33- =============================================================================== SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------- FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ---------------- UNITED STATES FILTER CORPORATION (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 3589 33-0266015 (STATE OR OTHER (PRIMARY STANDARD (I.R.S. EMPLOYER JURISDICTION INDUSTRIAL IDENTIFICATION NO.) OF INCORPORATION OR CLASSIFICATION CODE ORGANIZATION) NUMBER) 40-004 COOK STREET PALM DESERT, CALIFORNIA 92211 (619) 340-0098 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) ---------------- DAMIAN C. GEORGINO VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY UNITED STATES FILTER CORPORATION 40-004 COOK STREET PALM DESERT, CALIFORNIA 92211 (619) 340-0098 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) ---------------- Copy to: JANICE C. HARTMAN KIRKPATRICK & LOCKHART LLP 1500 OLIVER BUILDING PITTSBURGH, PENNSYLVANIA 15222 (412) 355-6500 ---------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: From time to time after this registration statement becomes effective. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [_] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_] ---------------- CALCULATION OF REGISTRATION FEE ===============================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF TO BE REGISTERED REGISTERED SHARE (1) PRICE (1) REGISTRATION FEE - -------------------------------------------------------------------------------------------------------- Common stock, par value $.01 per share........ 332,036 shares $33.6875 $11,185,462.75 $3,858
=============================================================================== (1) Estimated solely for the purpose of calculating the registration fee; computed in accordance with Rule 457(c) on the basis of the average of the high and low sales prices for the Common Stock on July 5, 1996 as reported on the New York Stock Exchange Composite Tape. ---------------- THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. =============================================================================== ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ +INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A + +REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE + +SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY + +OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT + +BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR + +THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE + +SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE + +UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF + +ANY SUCH STATE. + ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ SUBJECT TO COMPLETION, DATED JULY 8, 1996 PROSPECTUS JULY , 1996 332,036 SHARES [LOGO OF U.S. FILTER] UNITED STATES FILTER CORPORATION COMMON STOCK (PAR VALUE $.01 PER SHARE) ----------- This prospectus provides for the offering of up to an aggregate of 332,036 shares (the "Shares") of the Common Stock, par value $.01 per share ("Common Stock"), of United States Filter Corporation (the "Company"). The Shares were acquired by the Selling Stockholders named herein on August 10, 1995 in consideration of the sale to the Company of substantially all of the assets of Continental H/2/O Service, Inc. and Evansville Water Corporation d/b/a Interlake Water Systems ("Interlake") pursuant to the terms of an Asset Purchase Agreement dated August 10, 1995 (the "Asset Purchase Agreement"). As of the date of this Prospectus, 47,804 of the shares are held in escrow to secure the indemnity obligations of the Selling Stockholders and Interlake under the Asset Purchase Agreement. See "Selling Stockholders." The Shares may be offered or sold by or for the account of the Selling Stockholders from time to time or at one time on one or more exchanges or otherwise, at prices and on terms to be determined at the time of sale, to purchasers directly or by Donaldson, Lufkin & Jenrette Securities Corporation ("DLJ") who may receive compensation in the form of discounts, commissions or concessions. The Selling Stockholders and DLJ may be deemed to be "underwriters" within the meaning of the United States Securities Act of 1933, as amended (the "Securities Act"), and any discounts, concessions and commissions received by DLJ may be deemed to be underwriting commissions or discounts under the Securities Act. The Company will not receive any of the proceeds from any sale of the Shares offered hereby. See "Use of Proceeds," "Selling Stockholders" and "Plan of Distribution." The Common Stock is listed on the New York Stock Exchange (the "NYSE") and traded under the symbol "USF." The last reported sale price of the Common Stock on the NYSE on July 5, 1996 was $33.75 per share. ----------- SEE "RISK FACTORS" BEGINNING ON PAGE 3 FOR CERTAIN CONSIDERATIONS RELEVANT TO AN INVESTMENT IN THE COMMON STOCK. ----------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. AVAILABLE INFORMATION The Company is subject to the informational requirements of the United States Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files periodic reports, proxy solicitation materials and other information with the United States Securities and Exchange Commission (the "Commission"). Such reports, proxy solicitation materials and other information can be inspected and copied at the public reference facilities maintained by the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's Regional Offices located at Seven World Trade Center, Suite 1300, New York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such materials can be obtained from the Public Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission maintains a Web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission. Such reports, proxy and information statements and other information may be found on the Commission's site address, http://www.sec.gov. The Common Stock is listed on the NYSE. Such reports, proxy solicitation materials and other information can also be inspected and copied at the NYSE at 20 Broad Street, New York, New York 10005. The Company has filed with the Commission a registration statement on Form S-3 (herein, together with all amendments and exhibits, referred to as the "Registration Statement") under the Securities Act with respect to the offering made hereby. This Prospectus does not contain all of the information set forth in the Registration Statement, certain portions of which are omitted in accordance with the rules and regulations of the Commission. Such additional information may be obtained from the Commission's principal office in Washington, D.C. as set forth above. For further information, reference is hereby made to the Registration Statement, including the exhibits filed as a part thereof or otherwise incorporated herein. Statements made in this Prospectus as to the contents of any documents referred to are not necessarily complete, and in each instance reference is made to such exhibit for a more complete description and each such statement is modified in its entirety by such reference. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents filed by the Company with the Commission (File No. 1-10728) pursuant to the Exchange Act are incorporated herein by reference: the Company's Annual Report on Form 10-K for the year ended March 31, 1996; the Company's Current Reports on Form 8-K dated May 31, 1996 as amended on Form 8-K/A dated June 28, 1996, June 10, 1996 and June 27, 1996; and description of the Common Stock contained in the Company's Registration Statement on Form 8-A, as the same may be amended. All documents and reports subsequently filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to the termination of the offering made by this Prospectus shall be deemed to be incorporated by reference herein. Any statement contained herein or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any subsequently filed document which is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as modified or superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person to whom a copy of this Prospectus is delivered, upon the written or oral request of such person, a copy of any or all of the documents that are incorporated herein by reference, other than exhibits to such information (unless such exhibits are specifically incorporated by reference into such documents). Requests should be directed to Vice President, General Counsel and Secretary of United States Filter Corporation, 40-004 Cook Street, Palm Desert, California 92211 (telephone (619) 340-0098). 2 THE COMPANY The Company is a leading global provider of industrial and commercial water treatment systems and services, with an installed base of more than 100,000 systems worldwide. The Company offers a single-source solution to its industrial, commercial and municipal customers through what the Company believes to be the industry's broadest range of cost-effective water treatment systems, services and proven technologies. The Company capitalizes on its substantial installed base to sell additional systems and utilizes its global network of more than 125 sales and service facilities, including 21 manufacturing plants, to provide customers with ongoing service and maintenance. In addition, the Company is a leading international provider of service deionization ("SDI") and outsourced water services, including operation of water purification and wastewater treatment systems at customer sites. The Company's principal executive offices are located at 40-004 Cook Street, Palm Desert, California 92211, and its telephone number is (619) 340-0098. References herein to the Company refer to United States Filter Corporation and its subsidiaries, unless the context requires otherwise. RISK FACTORS Prospective investors should carefully consider the following factors relating to the business of the Company, together with the other information and financial data included or incorporated by reference in this Prospectus, before acquiring the Shares offered hereby. ACQUISITION STRATEGY In pursuit of its strategic objective of becoming the leading global single- source provider of water treatment systems and services the Company has, since 1991, acquired and successfully integrated more than 40 United States based and international businesses with strong market positions and substantial water treatment expertise. The Company's acquisition strategy entails the potential risks inherent in assessing the value, strengths, weaknesses, contingent or other liabilities and potential profitability of acquisition candidates and in integrating the operations of acquired companies. Although the Company generally has been successful in pursuing these acquisitions, there can be no assurance that acquisition opportunities will continue to be available, that the Company will have access to the capital required to finance potential acquisitions, that the Company will continue to acquire businesses or that any business acquired will be integrated successfully or prove profitable. INTERNATIONAL TRANSACTIONS The Company has made and expects it will continue to make acquisitions and to obtain contracts in Europe, Asia and Latin America and other areas outside the United States. While these activities may provide important opportunities for the Company to offer its products and services internationally, they also entail the risks associated with conducting business internationally, including the risk of currency fluctuations, slower payment of invoices and possible social, political and economic instability. RELIANCE ON KEY PERSONNEL The Company's operations are dependent on the continued efforts of senior management, in particular Richard J. Heckmann, its Chairman, Chief Executive Officer and President. Should any of the senior managers be unable to continue in their present roles, the Company's prospects could be adversely affected. PROFITABILITY OF FIXED PRICE CONTRACTS A significant portion of the Company's revenues are generated under fixed price contracts. To the extent that original cost estimates are inaccurate, costs to complete increase, delivery schedules are delayed or progress under a contract is otherwise impeded, revenue recognition and profitability from a particular contract may be 3 adversely affected. The Company routinely records upward or downward adjustments with respect to fixed price contracts due to changes in estimates of costs to complete such contracts. There can be no assurance that future downward adjustments will not be material. CYCLICALITY OF CAPITAL EQUIPMENT SALES The sale of capital equipment within the water treatment industry is cyclical and influenced by various economic factors including interest rates and general fluctuations of the business cycle. The Company's revenues from capital equipment sales were approximately 60% of total revenues for the fiscal year ended March 31, 1995 and 49% for the fiscal year ended March 31, 1996. While the Company sells capital equipment to customers in diverse industries and in global markets, cyclicality of capital equipment sales and instability of general economic conditions could have an adverse effect on the Company's revenues and profitability. POTENTIAL ENVIRONMENTAL RISKS The Company's business and products may be significantly influenced by the constantly changing body of environmental laws and regulations, which require that certain environmental standards be met and impose liability for the failure to comply with such standards. While the Company endeavors at each of its facilities to assure compliance with environmental laws and regulations, there can be no assurance that the Company's operations or activities, or historical operations by others at the Company's locations, will not result in civil or criminal enforcement actions or private actions that could have a materially adverse effect on the Company. In that regard, allegations have been made by federal and state environmental regulatory authorities of multiple violations by a wholly owned subsidiary of the Company with respect to applicable wastewater pretreatment standards at a Connecticut ion exchange regeneration facility acquired by the Company in October 1995 from Anjou International Company ("Anjou"). A grand jury investigation is pending which is believed to relate to the same conditions that were the subject of the allegations. The Company has rights of indemnification from Anjou which may be available with respect to these matters. The Company's activities as owner and operator of a hazardous waste treatment and recovery facility are subject to stringent laws and regulations and compliance reviews. Failure of this facility to comply with those regulations could result in substantial fines and the suspension or revocation of the facility's hazardous waste permit. In addition, to some extent, the liabilities and risks imposed by environmental laws on the Company's customers may adversely impact demand for certain of the Company's products or services or impose greater liabilities and risks on the Company, which could also have an adverse effect on the Company's competitive or financial position. COMPETITION The water purification and wastewater treatment industry is fragmented and highly competitive. The Company competes with many United States based and international companies in its global markets. The principal methods of competition in the markets in which the Company competes are technology, service, price, product specifications, customized design, product knowledge and reputation, ability to obtain sufficient performance bonds, timely delivery, the relative ease of system operation and maintenance, and the prompt availability of replacement parts. In the municipal contract bid process, pricing and ability to meet bid specifications are the primary considerations. While no competitor is considered dominant, there are competitors that are divisions or subsidiaries of larger companies which have significantly greater resources than the Company, which, among other things, could be a competitive disadvantage to the Company in securing certain projects. TECHNOLOGICAL AND REGULATORY CHANGE The water purification and wastewater treatment business is characterized by changing technology, competitively imposed process standards and regulatory requirements, each of which influences the demand for the Company's products and services. Changes in regulatory or industrial requirements may render certain of the Company's purification and treatment products and processes obsolete. Acceptance of new products may also be 4 affected by the adoption of new government regulations requiring stricter standards. The Company's ability to anticipate changes in technology and regulatory standards and to successfully develop and introduce new and enhanced products on a timely basis will be a significant factor in the Company's ability to grow and to remain competitive. There can be no assurance that the Company will be able to achieve the technological advances that may be necessary for it to remain competitive or that certain of its products will not become obsolete. In addition, the Company is subject to the risks generally associated with new product introductions and applications, including lack of market acceptance, delays in development or failure of products to operate properly. SHARES ELIGIBLE FOR FUTURE SALE The market price of the Common Stock could be adversely affected by the availability for sale of shares held on June 21, 1996 by security holders of the Company, including (i) up to 2,702,729 shares which may be delivered by Laidlaw Inc. or its affiliates ("Laidlaw"), at Laidlaw's option in lieu of cash, at maturity pursuant to the terms of 5 3/4% Exchangeable Notes due 2000 of Laidlaw (the amount of shares or cash delivered or paid to be dependent within certain limits upon the value of the Common Stock at maturity), (ii) 2,925,611 shares issuable upon conversion of convertible debentures of the Company at a conversion price of $20.50 per share of Common Stock and 5,090,909 shares issuable upon conversion of convertible notes of the Company at a conversion price of $27.50 per share of Common Stock that are currently registered for sale under the Securities Act pursuant to two shelf registration statements, (iii) 1,813,079 outstanding shares that are currently registered for sale under the Securities Act pursuant to a shelf registration statement, (iv) 114,994 outstanding shares that are covered by a shelf registration statement filed under the Securities Act, and (v) 1,905,074 shares which are subject to agreements pursuant to which the holders have certain rights to request the Company to register the sale of such holders' Common Stock under the Securities Act and, subject to certain conditions, to include certain percentages of such shares in other registration statements filed by the Company (1,320,000 of which shares also may be sold from time to time by the holders thereof pursuant to Rule 144 under the Securities Act). In addition, the Company has registered for sale under the Securities Act 3,242,772 shares which may be issuable by the Company from time to time in connection with acquisitions of businesses or assets from third parties. USE OF PROCEEDS The Selling Stockholders will receive all of the net proceeds from any sale of the Shares offered hereby, and none of such proceeds will be available for use by the Company or otherwise for the Company's benefit. SELLING STOCKHOLDERS The 332,036 Shares which may be offered pursuant to this Prospectus will be offered by or for the account of the Selling Stockholders as identified in the table below, all of whom acquired their Shares on August 10, 1995 pursuant to the Asset Purchase Agreement. The Shares constitute all of the shares of Common Stock beneficially owned by the Selling Stockholders, other than 10,000 shares of Common Stock that could be acquired by James Timothy Stockdale upon the exercise of options granted to him under the Company's 1991 Employee Stock Option Plan. In the aggregate, the Shares represented approximately 1.1% of the shares of Common Stock outstanding on June 21, 1996. Pursuant to the terms of an Indemnity Escrow Agreement dated August 10, 1995 (the "Escrow Agreement"), 47,804 of the Shares (the "Escrow Shares") are held in escrow as of the date of this Prospectus to secure the indemnity obligations of the Selling Stockholders and Interlake under the Asset Purchase Agreement. The Escrow Agreement provides that any Escrow Shares not previously used or set aside to satisfy claims made under the Escrow Agreement and not held pending the resolution of disputed claims will be released from the escrow account on August 10, 1996. The Selling Stockholders are prohibited from transferring or otherwise disposing of Escrow Shares before they are released from the escrow account. Subject to the Escrow Agreement, the Selling Stockholders intend to sell all of the Shares. 5 The following table sets forth the names of the Selling Stockholders and the number of Shares owned, including separately the number of Shares subject to the Escrow Agreement. The Shares held by each Selling Stockholder constitute less than 1% of the shares of Common Stock outstanding on June 21, 1996.
TOTAL NUMBER SELLING STOCKHOLDER OF SHARES ESCROW SHARES ------------------- ------------ ------------- Florence E. Stockdale............................ 119,199 17,161 James Timothy Stockdale.......................... 50,968 7,338 William E. Stockdale III......................... 50,968 7,338 John Christopher Stockdale....................... 50,968 7,338 Melody S. Williamson............................. 50,968 7,338 Katharine S. Price............................... 8,965 1,291
PLAN OF DISTRIBUTION Shares offered hereby may be sold from time to time or at one time by or for the account of the Selling Stockholders on one or more exchanges or otherwise; directly to purchasers in negotiated transactions; by or through DLJ, in ordinary brokerage transactions or transactions in which DLJ solicits purchasers; in block trades in which DLJ will attempt to sell Shares as agent but may position and resell a portion of the block as principal; in transactions in which DLJ purchases as principal for resale for its own account; or in any combination of the foregoing methods. Shares may be sold at a fixed offering price, which may be changed, at the prevailing market price at the time of sale, at prices related to such prevailing market price or at negotiated prices. DLJ may arrange for others to participate in any such transaction and may receive compensation in the form of discounts, commissions or concessions from the Selling Stockholders and/or the purchasers of Shares. The proceeds to the Selling Stockholders from any sale of Shares will be net of any such compensation, and of any expenses to be borne by the Selling Stockholders. If required at the time that a particular offer of Shares is made, a supplement to this Prospectus will be delivered that describes any material arrangements for the distribution of Shares and the terms of the offering, including, without limitation, any discounts, commissions or concessions and other items constituting compensation from the Selling Stockholders or otherwise. The Company may agree to indemnify DLJ against certain civil liabilities, including liabilities under the Securities Act. The Company and the Selling Stockholders are obligated to indemnify each other against certain civil liabilities arising under the Securities Act. The Selling Stockholders and DLJ may be deemed to be "underwriters" within the meaning of the Securities Act, in which event any discounts, commissions or concessions received by DLJ and any profit on the resale of the Shares purchased by DLJ may be deemed to be underwriting commissions or discounts under the Securities Act. The Company has informed the Selling Stockholders that the provisions of Rules 10b-6 and 10b-7 under the Exchange Act may apply to their sales of Shares and has furnished the Selling Stockholders with a copy of these rules. The Company also has advised the Selling Stockholders of the requirement for delivery of a prospectus in connection with any sale of the Shares. Any Shares covered by this Prospectus which qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than pursuant to this Prospectus. There is no assurance that the Selling Stockholders will sell any or all of the Shares. The Selling Stockholders may transfer, devise or gift such Shares by other means not described herein. The Company will pay all of the expenses, including, but not limited to, fees and expenses of compliance with state securities or "blue sky" laws, incident to the registration of the Shares, other than certain underwriting discounts and selling commissions and fees and expenses, if any, of counsel or other advisors retained by the Selling Stockholders. 6 VALIDITY OF COMMON STOCK The validity of the Shares will be passed upon for the Company by Damian C. Georgino, Vice President, General Counsel and Secretary of the Company. Mr. Georgino presently holds 100 shares of the Company's Common Stock and options granted under the Company's 1991 Employee Stock Option Plan to purchase an aggregate of 15,000 shares of Common Stock. INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS The consolidated financial statements of United States Filter Corporation and its subsidiaries as of March 31, 1995 and 1996 and for each of the three years in the period ended March 31, 1996 have been incorporated herein by reference in reliance upon the report of KPMG Peat Marwick LLP, independent certified public accountants, which report is incorporated herein by reference, and upon the authority of said firm as experts in accounting and auditing. The consolidated financial statements of Davis Water & Waste Industries, Inc. incorporated in this Prospectus by reference to the audited historical financial statements included in United States Filter Corporation's Form 8-K dated June 27, 1996 have been so incorporated in reliance on the report of Price Waterhouse LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting. The consolidated financial statements of Zimpro Environmental, Inc. as of December 31, 1995 and 1994 and for each of the three years in the period ended December 31, 1995 incorporated herein by reference, have been audited by Ernst & Young LLP, independent auditors, as set forth in their report thereon incorporated by reference elsewhere herein, and are included in reliance upon such report given upon the authority of such firm as experts in accounting and auditing. 7 =============================================================================== NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES TO WHICH IT RELATES OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE. ------------ TABLE OF CONTENTS
PAGE Available Information...................................................... 2 Incorporation of Certain Documents by Reference............................ 2 The Company................................................................ 3 Risk Factors............................................................... 3 Use of Proceeds............................................................ 5 Selling Stockholders....................................................... 5 Plan of Distribution....................................................... 6 Validity of Common Stock................................................... 7 Independent Certified Public Accountants................................... 7
=============================================================================== =============================================================================== 332,036 SHARES [LOGO OF U.S. FILTER] UNITED STATES FILTER CORPORATION COMMON STOCK ----------------- PROSPECTUS ----------------- , 1996 =============================================================================== PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The estimated expenses to be paid by the Company in connection with the distribution of the securities being registered, other than underwriting discounts and commissions, which will be borne by the Selling Stockholders, are as follows: Securities and Exchange Commission Filing Fee....................... $ 3,858 *Accounting Fees and Expenses....................................... 4,000 *Legal Fees and Expenses............................................ 8,500 *Printing Expenses.................................................. 10,860 *Miscellaneous Expenses............................................. 2,782 ------- Total............................................................. $30,000 =======
-------- * Estimated ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. The Certificate of Incorporation and the By-laws of the Company provide for the indemnification of directors and officers to the fullest extent permitted by the General Corporation Law of the State of Delaware, the state of incorporation of the Company. Section 145 of the General Corporation Law of the State of Delaware authorizes indemnification when a person is made a party or is threatened to be made a party to any proceeding by reason of the fact that such person is or was a director, officer, employee or agent of the corporation or is or was serving as a director, officer, employee or agent of another enterprise, at the request of the corporation, and if such person acted in good faith and in a manner reasonably believed by him or her to be in, or not opposed to, the best interests of the corporation. With respect to any criminal proceeding, such person must have had no reasonable cause to believe that his or her conduct was unlawful. If it is determined that the conduct of such person meets these standards, he or she may be indemnified for expenses incurred (including attorney's fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her in connection with such proceeding. If such a proceeding is brought by or in the right of the corporation (i.e., a derivative suit), such person may be indemnified against expenses actually and reasonably incurred if he or she acted in good faith and in a manner reasonably believed by him or her to be in, or not opposed to, the best interests of the corporation. There can be no indemnification with respect to any matter as to which such person is adjudged to be liable to the corporation; however, a court may, even in such case, allow such indemnification to such person for such expenses as the court deems proper. Where such person is successful in any such proceeding, he or she is entitled to be indemnified against expenses actually and reasonably incurred by him or her. In all other cases, indemnification is made by the corporation upon determination by it that indemnification of such person is proper because such person has met the applicable standard of conduct. The Company maintains an errors and omissions liability policy for the benefit of its officers and directors, which may cover certain liabilities of such individuals to the Company. II-1 ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (a) EXHIBITS. The following exhibits are filed as part of this registration statement:
EXHIBIT NUMBER DESCRIPTION ------- ----------- 5.01 Opinion of Damian C. Georgino as to the legality of the securities being registered 23.01 Consent of Damian C. Georgino (included in Exhibit 5.01) 23.02 Consent of KPMG Peat Marwick LLP 23.03 Consent of Price Waterhouse LLP 23.04 Consent of Ernst & Young LLP 24.01 Powers of Attorney (included on signature page of this registration statement) 99.01 Indemnity Escrow Agreement dated as of August 10, 1995 among the registrant, U.S. Filter/Ionpure, Inc., Continental H/2/O Service, Inc., Florence E. Stockdale, James Timothy Stockdale, William E. Stockdale III, John Christopher Stockdale, Melody S. Williamson and Katharine S. Price 99.02 Option and Registration Rights Agreement dated as of August 10, 1995 among the registrant, Florence E. Stockdale, James Timothy Stockdale, William E. Stockdale III, John Christopher Stockdale, Melody S. Williamson and Katharine S. Price
ITEM 17. UNDERTAKINGS. The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. Provided, however, that paragraphs (i) and (ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at the time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-2 Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palm Desert, State of California, on July 8, 1996. UNITED STATES FILTER CORPORATION /s/ Richard J. Heckmann By: _________________________________ Richard J. Heckmann Chairman of the Board, President and Chief Executive Officer KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Kevin L. Spence and Damian C. Georgino, and each of them, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to this Registration Statement, and to file the same, with all exhibits thereto, and other documentation in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in or about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated. SIGNATURE CAPACITY DATE --------- -------- ---- /s/ Richard J. Heckmann Chairman of the July 8, 1996 - ------------------------------------- Board, President RICHARD J. HECKMANN and Chief Executive Officer (Principal Executive Officer) and a Director /s/ Kevin L. Spence Vice President and July 8, 1996 - ------------------------------------- Chief Financial KEVIN L. SPENCE Officer (Principal Financial and Accounting Officer) /s/ Michael J. Reardon Executive Vice July 8, 1996 - ------------------------------------- President and a MICHAEL J. REARDON Director /s/ Tim L. Traff Senior Vice July 8, 1996 - ------------------------------------- President and a TIM L. TRAFF Director SIGNATURE CAPACITY DATE --------- -------- ---- /s/ James E. Clark Director July 8, 1996 - ------------------------------------- JAMES E. CLARK /s/ John L. Diederich Director July 8, 1996 - ------------------------------------- JOHN L. DIEDERICH /s/ Robert S. Hillas Director July 8, 1996 - ------------------------------------- ROBERT S. HILLAS /s/ Arthur B. Laffer Director July 8, 1996 - ------------------------------------- ARTHUR B. LAFFER /s/ Alfred E. Osborne, Jr. Director July 8, 1996 - ------------------------------------- ALFRED E. OSBORNE, JR. /s/ J. Danforth Quayle Director July 8, 1996 - ------------------------------------- J. DANFORTH QUAYLE /s/ C. Howard Wilkins, Jr. Director July 8, 1996 - ------------------------------------- C. HOWARD WILKINS, JR. EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION ------- ----------- 5.01 Opinion of Damian C. Georgino as to the legality of the securities being registered 23.01 Consent of Damian C. Georgino (included in Exhibit 5.01) 23.02 Consent of KPMG Peat Marwick LLP 23.03 Consent of Price Waterhouse LLP 23.04 Consent of Ernst & Young LLP 24.01 Powers of Attorney (included on signature page of this registration statement) 99.01 Indemnity Escrow Agreement dated as of August 10, 1995 among the registrant, U.S. Filter/Ionpure, Inc., Continental H/2/O Service, Inc., Florence E. Stockdale, James Timothy Stockdale, William E. Stockdale III, John Christopher Stockdale, Melody S. Williamson and Katharine S. Price 99.02 Option and Registration Rights Agreement dated as of August 10, 1995 among the registrant and, Florence E. Stockdale, James Timothy Stockdale, William E. Stockdale III, John Christopher Stockdale, Melody S. Williamson and Katharine S. Price
EX-5.01 2 OPINION OF DAMIAN C. GEORGINO EXHIBIT 5.01 July 8, 1996 United States Filter Corporation 40-004 Cook Street Palm Desert, California 92211 Ladies and Gentlemen: I am Vice President, General Counsel and Secretary to United States Filter Corporation, a Delaware corporation (the "Company"), and have acted as counsel to the Company in connection with the Registration Statement on Form S-3 (the "Registration Statement"), filed by the Company on July , 1996 with the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, with respect to an aggregate of up to 332,036 shares (the "Selling Stockholders' Shares") of the Company's Common Stock, par value $.01 per share, that may be offered or sold from time to time by the selling stockholders identified in the Registration Statement (the "Selling Stockholders"). I am familiar with the Registration Statement and have reviewed the Company's Certificate of Incorporation and By-laws, each as amended and restated. I have also examined such other public and corporate documents, certificates, instruments and corporate records, and such questions of law, as I have deemed necessary for purposes of expressing an opinion on the matters hereinafter set forth. In all examinations of documents, instruments and other papers, I have assumed the genuineness of all signatures on original and certified documents and the conformity to original and certified documents of all copies submitted to me as conformed, photostatic or other copies. On the basis of the foregoing, I am of the opinion that the Selling Stockholders' Shares have been validly issued and are fully paid and non- assessable. I consent to the filing of this opinion as Exhibit 5.01 to the Registration Statement and to the use of my name in the Prospectus forming a part thereof under the caption "Validity of Common Stock." Yours truly, /s/ Damian C. Georgino EX-23.02 3 CONSENT OF KPMG PEAT MARWICK LLP EXHIBIT 23.02 INDEPENDENT AUDITORS' CONSENT To the Board of Directors and Shareholders United States Filter Corporation: We consent to incorporation by reference in the Registration Statement on Form S-3 of United States Filter Corporation of our report dated June 7, 1996, relating to the consolidated balance sheets of United States Filter Corporation as of March 31, 1995 and 1996 and the related consolidated statements of operations, shareholders' equity and cash flows for each of the years in the three year period ended March 31, 1996 and to the reference to our firm under the heading "Independent Certified Public Accountants" in the prospectus. KPMG Peat Marwick LLP Orange County, California July 3, 1996 EX-23.03 4 CONSENT OF PRICE WATERHOUSE LLP EXHIBIT 23.03 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Prospectus constituting part of this Registration Statement on Form S-3 of United States Filter Corporation of our report dated June 13, 1996, relating to the consolidated financial statements of Davis Water & Waste Industries, Inc., which appears in the Current Report on Form 8-K of United States Filter Corporation dated June 27, 1996. We also consent to the reference to us under the heading "Independent Certified Public Accountants" in such Prospectus. Price Waterhouse LLP Atlanta, Georgia June 28, 1996 EX-23.04 5 CONSENT OF ERNST & YOUNG LLP EXHIBIT 23.04 CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Independent Certified Public Accountants" in the Registration Statement (Form S-3) and related Prospectus of United States Filter Corporation for the registration of 332,036 shares of its common stock and to the incorporation by reference therein of our report dated February 8, 1996, except for Notes 4 and 10, as to which the date is May 10, 1996, with respect to the consolidated financial statements of Zimpro Environmental, Inc. included in the Current Report on Form 8-K of United States Filter Corporation dated May 31, 1996, filed with the Securities and Exchange Commission. Ernst & Young LLP Minneapolis, Minnesota July 3, 1996 EX-99.01 6 INDEMNITY ESCROW AGEEMENT EXHIBIT 99.01 This is an INDEMNITY ESCROW AGREEMENT (this "Agreement") dated as of August 10, 1995, among United States Filter Corporation, a Delaware corporation ("USF"), U.S. Filter/Ionpure, Inc., a Massachusetts corporation ("USF/Ionpure"), Continental H/2/O Service, Inc., an Illinois corporation d/b/a Interlake Water Systems ("Seller"), and Florence E. Stockdale, James Timothy Stockdale, William E. Stockdale III, John Christopher Stockdale, Melody S. Williamson and Katharine S. Price (the "Stockholders"), and Chicago Title and Trust Company, in its capacity as escrow agent hereunder (the "Escrow Agent", which term shall also include any successor escrow agent appointed in accordance with Section 8(b) hereof). Reference is made to the Asset Purchase Agreement dated as of August 10, 1995 (the "Purchase Agreement") by and among USF/Ionpure, Seller and the Stockholders. Pursuant to the Purchase Agreement, Seller has sold substantially all of its assets to USF/Ionpure. USF/Ionpure has certain rights against Seller and the Stockholders under the Purchase Agreement which are secured by this Escrow Agreement. All capitalized terms used but not defined herein shall have the meanings ascribed thereto in the Purchase Agreement. This Agreement is designed to implement the provisions of the Purchase Agreement pursuant to which USF is depositing with the Escrow Agent 143,410 shares of Common Stock, $.01 par value per share (the "Escrow Shares") issued pursuant to the Purchase Agreement and $800,000 cash as security for the indemnification obligations of Seller and the Stockholders pursuant to Sections 7.02 and 7.03 of the Purchase Agreement, a potential Downward Adjustment pursuant to Section 1.09 of the Purchase Agreement and the sale of certain real estate in Hazel Park, Michigan pursuant to Section 1.14 of the Purchase Agreement. NOW, THEREFORE, in consideration of the premises and the representations and warranties and agreements contained herein, the parties hereto agree as follows: 1. Appointment of Escrow Agent; Escrow Account. The Escrow Agent is hereby appointed to act as escrow agent hereunder, and the Escrow Agent agrees to act as such. 2. Escrow Fund and Escrow Account. (a) On the date hereof, in accordance with Sections 1.08(a) and 1.14 of the Purchase Agreement, USF is delivering to the Escrow Agent one or more certificates representing the Escrow Shares and $800,000 cash and the Escrow Agent is accepting such certificates and cash in escrow for the benefit of the Stockholders and the Buyer Indemnitees pursuant to the provisions of this Agreement. The Escrow Shares and $800,000 cash delivered to the Escrow Agent pursuant to this Section 2(a), together with any dividends or distributions in cash, stock or property or any securities of USF issued in respect thereof (including, without limitation, any shares issued pursuant to any stock dividend, stock split, reverse stock split, combination or reclassification thereof and any proceeds payable upon a repurchase by USF of the Escrow Shares pursuant to the terms of that certain Option and Registration Rights Agreement dated the date hereof among the parties hereto (the "Option Agreement")) shall become part of, and are hereinafter referred to collectively as, the "Escrow Fund". (a) The Escrow Agent shall establish a segregated account (the "Escrow Account") at its office located at its address set forth in Section 10(a) in which to hold the Escrow Fund. The registered address for the holders of the Escrow Shares held in the Escrow Fund shall be the address of the Escrow Agent. (b) The Escrow Agent shall invest any cash in the Escrow Fund in direct obligations of, or obligations guaranteed by, the United States of America, or in money market funds that are invested solely in the foregoing. All interest and other income earned on the Escrow Fund, after payment of expenses incurred or taxes incurred in connection therewith shall be deemed to be a part of the Indemnity Escrow Fund for any and all purposes hereunder. 3. Rights to the Escrow Fund. The Escrow Fund shall be for the exclusive benefit of the Stockholders and the Buyer Indemnitees and their respective successors and assigns, as provided herein and in the Purchase Agreement, and no other person or entity shall have any right, title or interest therein. 4. Distribution of the Escrow Fund. The Escrow Agent shall continue to hold the Escrow Fund in its possession until authorized hereunder to distribute the Escrow Fund. The Escrow Agent shall distribute the Escrow Fund as follows: (a) In the event (I) any USF Indemnitee asserts a right of indemnity against the Stockholders under the Purchase Agreement, (II) USF/Ionpure makes a claim for a Downward Adjustment under the Purchase Agreement or (III) USF/Ionpure makes a claim under Section 1.14 of the Purchase Agreement, such person (the "Claiming Person") shall execute and deliver to the Escrow Agent (with a copy being sent simultaneously to the Stockholders) a written notice to such effect (a "Notice of Claim"; and the right or claim asserted in a Notice of Claim being hereinafter referred to as a "Claim") instructing the Escrow Agent to deliver that portion of the Escrow Fund the Fair Market Value (as defined in Section 5) of which shall equal the amount of the Claim (or, if the amount of the Claim shall be greater than the Fair Market Value of the Escrow Fund, the balance of the Escrow Fund) to such Claiming Person and the following shall apply: (i) a Notice of Claim delivered to the Escrow Agent pursuant to this Section 4(a) shall set forth the nature of such Claim (to the extent known), and the amount thereof (or if not ascertainable, a reasonable maximum amount thereof); and (ii) if within 30 days after receipt of any Notice of Claim by the Stockholders, the Stockholders fail to notify the Escrow Agent that the Claim, or the amount thereof, is disputed, the Escrow Agent shall, within 5 days after the expiration of such 30-day period, deliver to the Claiming Person that portion of the Escrow Fund the Fair Market Value of which shall equal the amount of the Claim as set forth in such Notice of Claim (or, if the amount of the Claim shall be greater than the Fair Market Value of the entire Escrow Fund as of such date, the balance of the Escrow Fund) (the date of any such delivery being referred to herein as a "Release Date"). If the Stockholders do so notify the Escrow Agent of such dispute (a copy of such notice being simultaneously sent to the Claiming Person), the Escrow Agent shall not deliver such amount to such Claiming Person (or to the Stockholders pursuant to Section 4(b) hereof) until 5 days after such dispute has been settled as provided in Section 9 hereof and notice of such settlement and of the amount, if any, to be paid in respect of the disputed Claim has been delivered to the Escrow Agent and the Stockholders (the date of receipt of any such notice being referred to herein as a "Settlement Notice Date"; and a Release Date or a Settlement Notice Date being referred to herein as a "Determination Date"), and (iii) the aggregate amount of any claim may be rounded at the discretion of the Escrow Agent to the nearest $100. (b) Anything contained herein to the contrary notwithstanding, if the Escrow Agent is authorized, at any time pursuant to Section 4(a) hereof, to deliver all of any portion of the Escrow Fund to USF/Ionpure with respect to a Claim or Claims, then such delivery shall be made regardless of the Escrow Agent's prior or subsequent receipt of any Notice of Claim or Notice of Dispute with respect to any other Claim or Claims. (c) Subject to Section 4(a) hereof, the Escrow Agent shall deliver to the Stockholders, pro rata in accordance with the percentages identified next to the signature lines hereto of each Stockholder ("Pro Rata Basis"), upon written notice to the Escrow Agent by the Stockholders and USF/Ionpure, that number of Escrow Shares that would leave as a balance in the Escrow Fund immediately after such distribution cash, investments and Escrow Shares (valued at Fair Market Value) that collectively aggregate to $1,800,000 (the "Remaining Escrow Fund"); provided, however, that if USF/Ionpure shall have purchased the Detroit Real Estate from Seller prior to such time, the Remaining Escrow Fund shall be $1,000,000 and not $1,800,000. (d) Subject to Section 4(a) hereof, the Escrow Agent shall deliver to the Seller, upon written notice to the Escrow Agent by the Stockholders and USF/Ionpure, an amount of cash which Seller and USF/Ionpure shall specify in said notice to the Escrow Agent and which USF/Ionpure and Seller shall agree shall be equal to the Detroit Real Estate Purchase Price. 2 (e) Subject to Section 4(a) hereof, on the date one year after the date of this Agreement, the Escrow Agent shall distribute to the Stockholders, on a Pro Rata Basis, the entire balance, if any, of the Escrow Fund that is in excess of the aggregate amounts specified in all Notices of Claim which, prior to such date, have not been paid to USF/Ionpure or otherwise discharged pursuant to this Section 4. Any portion of the Escrow Fund which shall continue to be held by the Escrow Agent pursuant to the preceding sentence shall be so held until such time as all disputed Claims hereunder have been settled and notice of such settlement or settlements setting forth the amounts to be paid to USF/Ionpure, on the one hand, and the Stockholders, on the other hand, have been delivered to the Escrow Agent. If a portion of the Escrow Fund is to be delivered to the Stockholders as provided in this Section 4(e), the Escrow Agent shall disburse such portion of the Escrow Fund to the Stockholders on a Pro Rata Basis. 5. Valuation. or all purposes of this Agreement, the "Fair Market Value" of any property (other than cash and Escrow Shares) contained in the Escrow Fund as of any date shall be the fair market value of such property as of such date as determined jointly by the Board of Directors of USF/Ionpure and the Stockholders in the good faith exercise of their reasonable business judgment, and the "Fair Market Value" per share of each Escrow Share shall be $20.91875 (which is the USF Common Share Value). 6. Stockholder Rights. Anything contained herein to the contrary notwithstanding, the record holders of Escrow Shares held in the Escrow Account shall at all times retain and have the full and absolute right to exercise, all rights and indicia of ownership, including, without limitation, voting and consensual rights, other than the right to receive dividends and other distributions in respect of, and the right to transfer or otherwise dispose of, such shares while such shares remain subject to the Escrow Agreement and the Option Agreement. The Stockholders and USF/Ionpure may exercise their respective rights under the Option Agreement with respect to Escrow Shares held hereunder and, so long as this Agreement has not been terminated, the Escrow Agent shall deliver certificates for such Escrow Shares for repurchase by USF under the Option Agreement, upon written instructions thereof to the Escrow Agent from USF/Ionpure and the Stockholders, and certain proceeds as a result of such purchase (as described in the Option Agreement) shall be delivered to the Escrow Agent and shall become part of the Escrow Fund. If any such Escrow Shares are transferred to USF/Ionpure pursuant to Section 4 hereof in satisfaction of a Claim or Claims, all rights and indicia of ownership shall thereupon reside with USF/Ionpure or any subsequent holders thereof. 7. Termination. This Agreement may be terminated at any time by and upon the receipt by the Escrow Agent of 10 days' prior written notice of termination executed by USF/Ionpure and the Stockholders directing the distribution of all property then held by the Escrow Agent under and pursuant to this Agreement. This Agreement shall automatically terminate if and when all amounts in the Escrow Account (including all the securities in which any funds contained in the Escrow Account shall have been invested) shall have been distributed by the Escrow Agent in accordance with the terms of this Agreement. 8. Rights and Duties of the Escrow Agent. (a) The Escrow Agent shall have and may exercise such powers hereunder as are specifically delegated to the Escrow Agent by the terms hereof, together with such powers as are reasonably incidental thereto, including the power to hire attorneys to represent the Escrow Agent with respect to matters arising from this Agreement and the power to file actions as it deems necessary in a court of appropriate jurisdiction. The Escrow Agent shall have no implied duties or any obligation to take any action hereunder except for any action specifically provided by this Agreement to be taken by the Escrow Agent. The Escrow Agent shall not be required to deliver the Escrow Account or any part thereof or take any action with respect to any matters that might arise in connection therewith, other than to receive, hold, and make delivery of the Escrow Account as herein provided or by reason of an order of a court of competent jurisdiction from which no appeal may timely be taken. The Escrow Agent shall not be liable to any party hereto for any action taken or omitted to be taken hereunder or in connection herewith except for its own gross negligence or willful misconduct. The Escrow Agent shall be fully justified in failing or refusing to take any action under this Agreement unless it shall first be indemnified to its reasonable satisfaction against any and all liability and expense which may be incurred by it by reason of taking or 3 continuing to take any such action. The Escrow Agent may execute any of its duties hereunder by or through employees, agents and attorneys-in-fact. (b) The Escrow Agent shall have the right to resign after first having given USF/Ionpure and the Stockholders notice in writing of its intent to resign at least thirty (30) days in advance. At the expiration of such thirty (30) days, the Escrow Agent shall deliver the remaining Escrow Account to a successor Escrow Agent designated in writing by USF/Ionpure and the Stockholders (which shall be a national banking institution). If the USF/Ionpure and the Stockholders fail to designate a successor to the Escrow Agent within such thirty (30) day period, the Escrow Agent shall institute a bill on interpleader as contemplated by Section 8(e)(ii) hereof. (c) If any property subject hereto is at any time attached, garnished or levied upon, under any court order, or in case the payment, assignment, transfer, conveyance or delivery of any such property shall be stayed or enjoined by any court order, or in case any order, judgment or decree shall be made or entered by any court of competent jurisdiction from which no appeal may timely be taken affecting such property, or any part thereof, then in any of such events, the Escrow Agent is authorized, in its sole discretion, to rely upon and comply with any such order, writ, judgment or decree, which it is advised by legal counsel of its own choosing is binding upon it, and if it complies with any such order, writ, judgment, award or decree, it shall not be liable to any of the parties hereto or to any other person, firm, or corporation by reason of such compliance, even though such order, writ, judgment, award or decree may be subsequently reversed, modified, annulled, set aside or vacated. (d) The Escrow Agent shall be entitled to rely upon the accuracy of, act in reliance upon the contents of and assume the genuineness of any notice which is given to the Escrow Agent pursuant to this Agreement and believed by it to be genuine and correct and to have been signed or sent by the proper person, without the necessity of the Escrow Agent verifying the truth or accuracy thereof. The Escrow Agent shall not be obligated to investigate or in any way determine whether any party to the Purchase Agreement is entitled to indemnification under the Purchase Agreement or the proper amount of any such indemnification. (e) Should any controversy arise between or among the Buyer Indemnitees and the Stockholders, or any other person, firm or entity, with respect to this Agreement, the Escrow Account, or any part thereof, or the right of any party or other person to receive the Escrow Account, or should the USF/Ionpure and the Stockholders fail to designate another Escrow Agent as provided in Section 8(b) hereof, or if the Escrow Agent should be in doubt as to what action to take, the Escrow Agent shall have the right (but not the obligation) to (i) withhold delivery of the Escrow Account until the controversy is resolved pursuant to the Purchase Agreement, or, (ii) institute a bill of interpleader in any court of competent jurisdiction to determine the rights of the parties hereto (the right of the Escrow Agent to institute such bill of interpleader shall not, however, be deemed to modify the manner in which the Escrow Agent is entitled to make disbursements of the Escrow Account as hereinabove set forth other than to tender the Escrow Account into the registry of such court, nor shall it change the obligations of the Buyer Indemnitees and the Stockholders to settle disputes through arbitration as provided in the Purchase Agreement). (f) If the Escrow Account created by this Agreement shall constitute a trust taxable pursuant to Subchapter J of the Internal Revenue Code of 1986, as amended, and applicable state law, then in January of each year during the term of this Agreement, and at any other time as reasonably directed by USF/Ionpure, the Escrow Agent shall direct KPMG Peat Marwick or such other accounting firm as is mutually acceptable to the USF/Ionpure Indemnitees and the Stockholders, to prepare and file all required income tax returns for the Escrow Account. The Escrow Agent is authorized to provide such accountants with any records related to the Escrow Account necessary to prepare such returns. The Escrow Agent shall not be responsible for any acts, omissions, verifications or calculations conducted or performed by such accounting firm in the course of its preparing and filing such income tax returns, and it is further understood that the accounting firm will be employed by the USF/Ionpure Indemnitees and the Stockholders, on behalf of the Escrow Account and not individually, and is not an agent of the Escrow Account. (g) USF/Ionpure and the Stockholders shall split equally the $2,500 fee per annum of the Escrow Agent as compensation for the ordinary administrative services to be rendered hereunder. The Escrow Agent shall invoice 4 such fee. To the extent such fee is not paid within 60 days from the date set forth on said invoice, the Escrow Agent shall be authorized to deduct such fee from the Escrow Fund. USF/Ionpure, on the one hand, and the Stockholders, jointly and severally on the other hand, shall each pay 50% of all other reasonable fees and expenses of the Escrow Agent, including reasonable attorneys' fees and expenses, if any, which it may incur in connection with the performance of its duties under this Agreement. 9. Disputes. If any dispute should arise with respect to the payment or ownership or right of possession of the Escrow Fund, or the duties of the Escrow Agent hereunder, the Escrow Agent is authorized and directed to retain in its possession, without liability to anyone, all or any part of the Escrow Fund until such dispute shall have been settled either by mutual agreement of USF/Ionpure and the Stockholders (evidenced by appropriate instructions in writing to the Escrow Agent signed by USF/Ionpure and the Stockholders) or by the final order, decree or judgment of a court of competent jurisdiction in the United States of America (the time for appeal having expired with no appeal having been taken) in a proceeding to which USF/Ionpure and the Stockholders are parties, but the Escrow Agent shall be under no duty whatsoever to institute or defend any such proceedings. In the event of any dispute between or among any of the parties to this Agreement, or between or among them or any of them and any other person, resulting in adverse claims or demand being made upon the Escrow Fund, or in the event that the Escrow Agent, in good faith, is in doubt as to what action it should take hereunder, the Escrow Agent may, at its option, file a suit in interpleader in a court of competent jurisdiction, or refuse to comply with any claims or demands on it, or refuse to take any other action hereunder, so long as such dispute shall continue or such doubt shall exist. The Escrow Agent shall be entitled to continue so to refrain from acting until (a) the rights of all parties have been fully and finally adjudicated by the final order, decree or judgment of a court of competent jurisdiction in the United States of America (the time for appeal having expired with no appeal having been taken) or (b) all differences shall have been adjusted and all doubt resolved by agreement among all of the interested persons, and in each case the Escrow Agent shall have been notified thereof in a writing signed by all such persons. 10. Stockholders' Committee. (a) Creation. The Stockholders do hereby, for themselves and their personal representatives and other successors, constitute and appoint a committee of three persons initially to consist of Florence E. Stockdale, James Timothy Stockdale and John Christopher Stockdale as their agents and attorneys-in-fact (the "Stockholders' Committee") to take all action required or permitted under this Agreement, including the execution and delivery of this Agreement on behalf of the Stockholders, the giving and receiving of all notices and consents and the execution and delivery of all documents, including any amendments of any non-material term or provision of this Agreement, the execution and delivery of any agreements and releases in connection with the settlement of any dispute or claim under this Agreement or to satisfy any expense obligations of the Stockholders under this Agreement. The vote of a majority of the Stockholders' Committee shall be required to take any action on behalf of the Stockholders pursuant to the authority granted to them under this Section. (b) Continuance; Certain Rules. In the event of the death, physical or mental incapacity or resignation of any of the members of any of the Stockholders' Committee or a vacancy thereon for any other reason, the remaining members of the Stockholders' Committee shall promptly appoint a substitute or substitutes and shall advise Buyer thereof. As between the Stockholders' Committee and the Stockholders, the members of the Stockholders' Committee shall not be liable for, and shall be indemnified by the Stockholders or provided with insurance against, any good faith error of judgment on their part or any other act done or omitted by them in good faith in connection with their duties as members of such Committee, except for gross negligence or willful misconduct. The Stockholders' Committee may consult with professional advisors of its choice. All expenses incurred by the members of the Stockholders' Committee in performing their duties (including fees and expenses of professional advisors) and any indemnification to be provided to the Stockholders' Committee shall be jointly and severally borne by the Stockholders. (c) Buyer Reliance. USF/Ionpure, USF and the Escrow Agent shall be entitled to rely exclusively upon any communications given to or by the Stockholders' Committee on behalf of all Stockholders, and shall not be 5 liable for any action taken or not taken in reliance upon the Stockholders' Committee. USF/Ionpure, USF and the Escrow Agent shall be entitled to disregard any notices or communications given or made by the Stockholders unless given or made through the Stockholders' Committee. 11. Miscellaneous. (a) Notices. All notices, claims, certificates, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if personally delivered or if sent by telecopier, nationally- recognized overnight courier or by registered or certified mail, return receipt requested and postage prepaid, addressed as follows: (i) if to USF, USF/Ionpure or any Buyer Indemnitees, to: United States Filter Corporation 73-710 Fred Waring Drive Suite 222 Palm Desert, CA 92260 Attn: Chief Executive Officer Telecopy: 619/341-9368 with a copy to: Donald L. Bergmann, Esq. Vice President, General Counsel and Secretary United States Filter Corporation 110 Washington Avenue North Haven, CT 06473 Telecopy: 203/234-0171 (ii) if to the Stockholders or the Stockholders' Committee, to: Mr. James Timothy Stockdale 2660 South 17th Avenue Broadview, IL 60153 Facsimile No.: 708-345-8006 with a copy to: Howard N. Gilbert, Esq. Holleb & Coff 55 East Monroe Street Chicago, IL 60603-5896 Telecopy: 312-807-3900 (iii) if to the Escrow Agent, to: Chicago Title and Trust Company 171 North Clark Street Chicago, IL 60601 Attention: Naomi Weitzel or to such other address as the party to whom notice is to be given may have furnished to the other parties hereto in writing in accordance herewith. Any such notice or communication shall be deemed to have been received (a) in the case of personal delivery or delivery by telecopier, on the date of such delivery, (b) in the case of nationally-recognized overnight courier, on the next business day after the date when sent and (c) in the case of mailing, on the third business day following that on which the piece of mail containing such communication is posted. 6 (b) Counterparts. This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all such counterparts together shall constitute but one agreement. (c) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Illinois applicable to agreements made and to be wholly performed within such state. (d) Parties in Interest. This agreement shall be binding upon, inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and assigns. Anything contained herein to the contrary notwithstanding, this Agreement shall not be assigned by any party hereto without the consent of the other parties hereto. (e) Amendments. This Agreement may be amended only by a written instrument duly executed by the parties hereto. (f) Headings. The section and paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. 7 IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement to be executed and delivered on the date first above written. UNITED STATES FILTER CORPORATION /s/ John S. Swartley By: _________________________________ Name: John S. Swartley Title: Senior Vice President CONTINENTAL H\\2\\O SERVICE, INC., D/B/A INTERLAKE WATER SYSTEMS /s/ James Timothy Stockdale By: _________________________________ Title: President U.S. FILTER/IONPURE, INC. /s/ John S. Swartley By: _________________________________ Title: Vice President STOCKHOLDERS: /s/ Florence E. Stockdale _____________________________________ Florence E. Stockdale (35.90%) /s/ James Timothy Stockdale _____________________________________ James Timothy Stockdale (15.35%) /s/ William E. Stockdale III _____________________________________ William E. Stockdale III (15.35%) /s/ John Christopher Stockdale _____________________________________ John Christopher Stockdale (15.35%) /s/ Melody S. Williamson _____________________________________ Melody S. Williamson (15.35%) /s/ Katharine S. Price _____________________________________ Katharine S. Price (2.70%) Accepted and Agreed to as of the Date First Written Above: ESCROW AGENT: CHICAGO TITLE AND TRUST COMPANY /s/ Naomi Weitzel By: _________________________________ Name: Naomi Weitzel Title: Assistant Vice President 8 EX-99.02 7 OPTION & REGISTRATION AGREEMENT EXHIBIT 99.02 ================================================================================ OPTION AND REGISTRATION RIGHTS AGREEMENT BY AND AMONG UNITED STATES FILTER CORPORATION, FLORENCE E. STOCKDALE, JAMES TIMOTHY STOCKDALE, WILLIAM E. STOCKDALE III, JOHN CHRISTOPHER STOCKDALE, MELODY S. WILLIAMSON AND KATHARINE S. PRICE DATED AS OF AUGUST 10, 1995 ================================================================================ OPTION AND REGISTRATION RIGHTS AGREEMENT BY AND AMONG UNITED STATES FILTER CORPORATION, FLORENCE E. STOCKDALE, JAMES TIMOTHY STOCKDALE, WILLIAM E. STOCKDALE III, JOHN CHRISTOPHER STOCKDALE, MELODY S. WILLIAMSON AND KATHARINE S. PRICE DATED AS OF AUGUST 10, 1995 TABLE OF CONTENTS
PAGE ---- 1. Certain Definitions............................................................. 3 2. Restrictions on Transferability................................................. 3 3. Restrictive Legends............................................................. 4 4. Notice of Proposed Transfers.................................................... 4 5. Demand Registration............................................................. 5 6. Underwriting.................................................................... 5 7. Company Registration............................................................ 6 8. Expenses of Registration........................................................ 6 9. Indemnification................................................................. 7 10. Obligations of the Company...................................................... 8 11. Information by Holder........................................................... 9 12. Securities Law Compliance....................................................... 9 13. Standoff Agreement.............................................................. 9 14. Rule 144 Requirements........................................................... 9 15. Put Right and Call Offer........................................................ 10 16. Investment Representation....................................................... 11 17. Amendment....................................................................... 11 18. Notices......................................................................... 11 19. Transferability................................................................. 12 20. Governing Law................................................................... 12 21. Severability.................................................................... 12 22. Counterparts.................................................................... 12
2 OPTION AND REGISTRATION RIGHTS AGREEMENT This Option and Registration Rights Agreement ("Agreement") is entered into as of August 10, 1995 by and among United States Filter Corporation, a Delaware corporation (the "Company"), Florence E. Stockdale, James Timothy Stockdale, William E. Stockdale III, John Christopher Stockdale, Melody S. Williamson and Katharine S. Price with reference to the shares of Common Stock, $.01 par value (the "Common Stock"), of the Company. 1. Certain Definitions. As used in this Agreement, the following terms shall have the following respective meanings: "Commission" means the U.S. Securities and Exchange Commission or any other federal agency at the time administering the Securities Act. "Common Shares" means the 334,626 shares of Common Stock issued pursuant to the Asset Purchase Agreement dated as of August 10, 1995 among U.S. Filter/Ionpure, Inc., a Massachusetts corporation, the Purchasers and Continental H\\2\\O Services, Inc., an Illinois corporation, as that number shall be adjusted for adjustments to the purchase price pursuant thereto and for stock splits, stock dividends, combinations, mergers or similar recapitalizations on or after the date hereof (the "Purchase Agreement"). "Exchange Act" means the Securities Exchange Act of 1934, as amended, or any similar federal statute and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time. "Holder" means (i) the Purchasers, and (ii) any permitted assignee or transferee of one or more of the Purchasers. "Purchasers" means Florence E. Stockdale, James Timothy Stockdale, William E. Stockdale III, John Christopher Stockdale, Melody S. Williamson and Katharine S. Price. "Registrable Securities" means the Common Shares; provided, however, that Common Shares shall be treated as Registrable Securities only if and so long as they have not been (i) sold in a public distribution or a public securities transaction, or (ii) sold in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act under Section 4(1) thereof so that all transfer restrictions and restrictive legends with respect thereto are removed upon the consummation of such sale. "Register", "Registered" and "Registration" refer to a registration effected by preparing and filing a registration statement pursuant to the Securities Act, and the declaration or ordering of the effectiveness of such registration statement by the Commission. "Registration Expenses" means all expenses incurred by the Company in complying with Sections 5, 7 and 10 hereof, including, without limitation, all registration, qualification and filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the Company, blue sky fees and expenses, and the expense of any special audits incident to or required by any such registration (but excluding the compensation of regular employees of the Company which shall be paid in any event by the Company). "Restricted Securities" shall mean the Common Shares of the Company required to bear the legend set forth in paragraph (a) of Section 3 hereof. "Rule 144" shall mean Rule 144 promulgated by the Commission under the Securities Act, as in effect at the time, or any successor rule or regulation. "Securities Act" shall mean the U.S. Securities Act of 1933, as amended, or any similar federal statute and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time. "Selling Expenses" shall mean all underwriting discounts, selling commissions and stock transfer taxes applicable to the securities registered by the Holders and all fees and disbursements of counsel for the Holders. 2. Restrictions on Transferability. The Common Shares may be sold, assigned, transferred or pledged only in accordance with the conditions specified in this Agreement. Each Holder will cause any proposed 3 purchaser, assignee, transferee or pledgee of Common Shares which would also be deemed a Holder to agree to take and hold such Common Shares subject to the provisions of this Agreement, including, without limitation, the restrictions contained in Sections 12 and 13 hereof, as if they applied by their terms to all Holders in their individual capacities, and shall furnish the Company with copies of all transfer, assignment or pledge documents. 3. Restrictive Legends. (a) Each certificate or instrument representing Common Shares or any securities issued in respect of the Common Shares upon any stock split, stock dividend, recapitalization, merger or similar event, shall (unless otherwise permitted by the provisions of Section 4 below) bear the following legend: THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAW. SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR PLEDGED IN THE ABSENCE OF SUCH REGISTRATION UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL (WHO MAY BE COUNSEL FOR THE COMPANY) REASONABLY ACCEPTABLE TO IT STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT AND ANY OTHER APPLICABLE SECURITIES LAWS. (b) Each certificate or instrument representing Common Shares shall also bear the following legend: THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF AN AGREEMENT BETWEEN CERTAIN STOCKHOLDERS AND THE CORPORATION WHICH INCLUDES RESTRICTIONS ON CERTAIN SALES OF THE SECURITIES AND AN OPTION TO PURCHASE THE SECURITIES BY THE COMPANY. COPIES OF THE AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF UNITED STATES FILTER CORPORATION. (c) Each Holder consents to the Company's making a notation on its records and giving instructions to any transfer agent of the Common Shares in order to implement the restrictions on transfer established in this Agreement. The legend placed on any certificate pursuant to Section 3(a) and any notations or instructions with respect to the Common Shares represented by such certificate will be promptly removed, and the Company will promptly issue a certificate without such legend to the Holder of such Common Shares (i) if such Common Shares are registered under the Securities Act in connection with a sale of such Common Shares and a prospectus meeting the requirements of Section 10 of the Securities Act is available, (ii) if the Holder thereof satisfies the requirements of Rule 144(k), or (iii) if the Holder provides the Company with an unqualified written opinion of legal counsel for the Holder of the Common Shares, both such counsel and such opinion being reasonably satisfactory to the Company, to the effect that a sale, transfer or assignment of the Common Shares, may be made without registration under the Securities Act. 4. Notice of Proposed Transfers. The Holder of each certificate representing Restricted Securities by acceptance thereof agrees to comply in all respects with the provisions of this Section 4. Prior to any proposed sale, assignment, transfer or pledge of any Restricted Securities, unless there is in effect a registration statement under the Securities Act covering the proposed transfer, the Holder thereof shall give written notice to the Company of such Holder's intention to effect such transfer, sale, assignment or pledge. Each such notice shall describe the manner and circumstances of the proposed transfer, sale, assignment or pledge in sufficient detail, and shall be accompanied at such Holder's expense by either (i) such unqualified written opinion of legal counsel reasonably satisfactory to the Company, certificates and other information as the Company may reasonably require to confirm that the transfer complies with the restrictions provided for in the legend contemplated by Section 3(a) or (ii) a "no action" letter from the Commission to the effect that the transfer of such securities without registration will not result in a recommendation by the staff of the Commission that action be taken with respect thereto, whereupon the Holder of such Restricted Securities shall be entitled to transfer such Restricted Securities in accordance with the terms of its notice to the Company. The Company will not require such a legal opinion or "no action" letter in any transaction which complies with Rule 144. Each certificate evidencing the 4 Restricted Securities transferred as above provided shall bear, except if such transfer is made pursuant to Rule 144, the appropriate restrictive legend set forth in Section 3(a) above, except that such certificate shall not bear such restrictive legend if in the opinion of counsel for such Holder and the Company such legend is not required in order to establish compliance with any provisions of the Securities Act. 5. Demand Registration. If the Company shall receive from one or more Purchasers a written request that the Company effect any registration with respect to at least 200,000 shares of Registrable Securities, the Company will: (a) promptly give written notice of the proposed registration to all other Holders; and (b) file a registration statement (on Form S-3 or successor form) with the Commission within 120 days after the initiating Purchaser's request and use its best efforts to effect such registration (including, without limitation, the execution of an undertaking to file post-effective amendments, appropriate qualification under applicable blue sky or other state securities laws and appropriate compliance with applicable regulations issued under the Securities Act) as would permit or facilitate the sale and distribution of such Registrable Securities as are specified in such request, together with all Registrable Securities of any Holder or Holders joining in such request as are specified in a written request received by the Company within 30 days after receipt of such written notice from the Company; Provided, however, that the Company shall not be obligated to take any action to effect any such registration, qualification or compliance pursuant to this Section 5: (i) In any particular jurisdiction in which the Company would be required to execute a general consent to service of process in effecting such registration, qualification or compliance unless the Company is already subject to service in such jurisdiction and except as may be required by the Securities Act; (ii) If, at such time as a request for registration pursuant to this Section 5 is pending, the Company has already effected one such registration pursuant to this Section 5, and such registration has been declared or ordered effective; (iii) During the period starting with the date 60 days prior to the filing of, and ending on a date three months following the effective date of, a registration statement (other than with respect to a registration statement relating to a Rule 145 transaction, an offering solely to employees or any other registration which is not appropriate for the registration of Registrable Securities); or (iv) In the circumstances set forth in Section 10(b). 6. Underwriting. The right of any Holder to registration pursuant to Section 5 shall be conditioned upon such Holder's participation in any underwriting arrangements required by the Holders pursuant to this Section 6. If the initiating Purchaser proposes to distribute such Purchaser's Registrable Securities pursuant to Section 5 hereof by means of an underwritten public offering, the Company (together with all Holders proposing to distribute their securities through such underwriting) shall enter into an underwriting agreement in customary form satisfactory to the Company and the participating Holders with the managing underwriter selected for such underwriting by the participating Holders (which managing underwriter shall be reasonably acceptable to the Company). Notwithstanding any other provision of Section 5, if the managing underwriter advises the participating Holders in writing that marketing factors require a limitation of the number of shares to be underwritten, then the number of shares of Registrable Securities that may be included in the registration and underwriting shall be allocated among all participating Holders thereof in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held by such Holders at the time of filing the registration statement; provided, however, that the Holders shall not be required to limit the Registrable Securities to be included unless and until the Company, if applicable, and all of the registrable shares of all other security holders of the Company with piggyback registration rights have been excluded from such registration. No Registrable Securities excluded from the underwriting by reason of the underwriter's marketing limitation shall be included in such registration. 5 If any participating Holder of Registrable Securities disapproves of the terms of the underwriting, such person may elect to withdraw therefrom by written notice to the Company, the managing underwriter and the participating Holders. If by the withdrawal of such Registrable Securities a greater number of Registrable Securities held by other Holders may be included in such registration (up to the maximum of any limitation imposed by the underwriters), then the Company shall offer to all Holders who have included Registrable Securities in the registration the right to include additional Registrable Securities in the same proportion used in determining the underwriter limitation in this Section 6. 7. Company Registration. (a) Notice of Registration. Subject to Section 10(b) hereof, if, at any time or from time to time, the Company shall determine to register any of its Common Stock, either for its own account or the account of a security holder or holders exercising their respective demand registration rights, other than a registration relating solely to employee benefit plans or a registration relating solely to a Securities Act Rule 145 transaction, the Company will (i) promptly give to each Holder written notice thereof, and (ii) include in such registration (and any related qualification under blue sky laws or other compliance), and (subject to this Section 7) in any underwriting involved therein, all the Registrable Securities specified in a written request or requests made by any Holder within 30 days after its receipt of such written notice from the Company; provided, however, that in no event shall the Holders have the right, unless the Company or the security Holders exercising their demand registration rights, if applicable, otherwise agree, to include in such registration Registrable Securities amounting to more than 10% of the total number (or total value, according to the respective offering prices) of all securities to be included in such registration. (b) Underwriting. If the registration of which the Company gives notice is for a registered public offering involving an underwriting, the Company shall so advise the Holders as a part of the written notice given pursuant to Section 7(a)(i). In such event the right of any Holder to registration pursuant to this Section 7 shall be conditioned upon such Holder's participation in such underwriting and the inclusion of Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute all or a portion of their securities through such underwriting shall (together with the Company and the other holders distributing their securities through such underwriting) enter into an underwriting agreement in customary form with the managing underwriter selected for such underwriting by the Company (or by the Holders who have demanded such registration). Notwithstanding any other provision of this Section 7, if the managing underwriter determines that marketing factors require a limitation of the number of shares to be underwritten, the managing underwriter may limit the Registrable Securities to be included in such registration. The Company shall so advise all Holders and the other holders distributing their securities through such underwriting pursuant to piggyback registration rights similar to this Section 7, and the number of shares of Registrable Securities and other securities that may be included in the registration and underwriting by such Holders and such other holders shall be reduced by the number of shares determined by the managing underwriter not to be included in such registration, such cutback to be allocated among all Holders and other holders in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held by such Holders and other securities held by such other holders. If any Holder or other holder disapproves of the terms of any such underwriting, he may elect to withdraw therefrom by written notice to the Company and the managing underwriter. (c) Right to Terminate Registration. The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 7 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration. 8. Expenses of Registration. All Registration Expenses incurred in connection with any registration pursuant to Sections 5 or 7 shall be borne by the Company, provided, however, that the Company shall not be required to pay the Registration Expenses of any registration proceeding begun pursuant to Section 5, the request of which has been subsequently withdrawn by the Holders, in which event the Holders of Registrable Securities to have been registered shall bear all such Registration Expenses pro rata on the basis of the number of Registrable Securities to have been registered. Unless otherwise stated, all other Selling Expenses relating to 6 securities registered on behalf of the Holders shall be borne by the Holders of the Registrable Securities pro rata on the basis of the number of shares so registered. 9. Indemnification. (a) The Company will indemnify each Holder, each of its officers, directors, partners, employees and agents and each person controlling such Holder within the meaning of Section 15 of the Securities Act, with respect to which registration, qualification or compliance has been effected pursuant to this Agreement, against all expenses, claims, losses, damages or liabilities (or actions in respect thereof), including any of the foregoing incurred in settlement of any litigation, commenced or threatened, arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any registration statement, prospectus, offering circular or other document, or any amendment or supplement thereto, incident to any such registration, qualification or compliance, or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading, or any violation by the Company of any rule or regulation promulgated under the Securities Act or any other federal, state or common law rule or regulation applicable to the Company in connection with any such registration, qualification or compliance, and the Company will reimburse each such Holder, each of its officers, directors, employees and agents and each person controlling such Holder for any legal and any other expenses reasonably incurred in connection with investigating, preparing or defending any such claim, loss, damage, liability or action, provided that the Company will not be liable in any such case to the extent that any such claim, loss, damage, liability or expense arises out of or is based on any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by such Holder or controlling person. (b) Each Holder will, if Registrable Securities held by such Holder are included in the securities as to which such registration, qualification or compliance is being effected, indemnify the Company, each of its directors and officers, each underwriter, if any, of the Company's securities covered by such a registration statement, each person who controls the Company or such underwriter within the meaning of Section 15 of the Securities Act, and each other such Holder, each of its officers and directors and each person controlling such Holder within the meaning of Section 15 of the Securities Act, against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any such registration statement, prospectus, offering circular or other document, or any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Company, such Holders, such directors, officers, persons, underwriters or control persons for any legal or any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular or other document in reliance upon and in conformity with written information furnished to the Company by such Holder. (c) Each party entitled to indemnification under this Section 9 (the "Indemnified Party") shall give notice to the party required to provide indemnification (the "Indemnifying Party") promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval shall not unreasonably be withheld), and the Indemnified Party may participate in such defense at such party's expense, and provided further that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Agreement unless the failure to give such notice is materially prejudicial to an Indemnifying Party's ability to defend such action. No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation. 7 (d) In order to provide for just and equitable contribution to joint liability under the Securities Act in any case in which any Holder of Registrable Securities exercising rights under this Agreement, or any controlling person of any such Holder, makes a claim for indemnification pursuant to this Section 9 but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Section 9 provides for indemnification in such case, then, the Company and such Holder will contribute to the aggregate losses, claims, damages or liabilities to which they may be subject (after contribution from others) in such proportion so that such Holder is responsible for the portion represented by the percentage that the public offering price of its Registrable Securities offered by the registration statement bears to the public offering price of all securities offered by such registration statement; and the Company is responsible for the remaining portion; provided, however, that, in any such case, (A) no such Holder will be required to contribute any amount in excess of the public offering price of all such Registrable Securities offered by it pursuant to such registration statement; and (B) no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. 10. Obligations of the Company. (a) Whenever required under this Agreement to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible: (i) Prepare and file with the Commission a registration statement with respect to such Registrable Securities and use its diligent best efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for up to 120 days. (ii) Prepare and file with the Commission such amendments and supplements to such registration statement as may be necessary (A) to update and keep such registration statement effective as provided in Section 10(a)(i) above, (B) to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement and (C) to reflect a modification in the manner of distribution of the Registrable Securities and, to the extent that such distribution is modified to employ an underwriter, to amend the registration statement in the manner required by such underwriter. Notwithstanding anything else to the contrary contained herein, the Company shall not be required to disclose in any prospectus prepared pursuant to Section 5 or 7 hereof any confidential information concerning pending events, transactions or conditions not otherwise required to be disclosed by applicable securities laws. (iii) Furnish to the Holders such numbers of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them. (iv) Use its best efforts to register and qualify the securities covered by such registration statement under such other securities or blue sky laws of such jurisdictions as shall be reasonably requested by the Holders, provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions unless it is already subject to such jurisdiction. (v) In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter of such offering. Each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement. (vi) Notify each Holder of Registrable Securities covered by such registration statement, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein 8 or necessary to make the statements therein not misleading in the light of the circumstances under which the prospectus is used. (b) The Company shall not be obligated to effect a registration under Section 5 or include any Holder in a registration as provided in Section 7 if, within 90 days after an initiating Purchaser's request under Section 5 or at any time prior to the filing of a registration statement as contemplated in Section 7, the Company shall have delivered to the initiating Purchaser making the written request under Section 5 or to the Holders making requests under Section 7, as the case may be, a written opinion, reasonably satisfactory to such initiating Purchaser or to the Holders of a majority of the Registrable Securities requested to be included in a registration pursuant to Section 7, of Kirkpatrick & Lockhart, LLP or other legal counsel reasonably satisfactory to such respective persons, to the effect that the Registrable Securities which are the subject of the request under Section 5 or which would otherwise be included in the registration as contemplated by Section 7 may be sold without registration and without compliance with paragraphs (c), (e), (f) or (h) of Rule 144. 11. Information by Holder. The Holder or Holders of Registrable Securities included in any registration shall furnish to the Company such information regarding such Holder or Holders, the Registrable Securities held by them and the distribution proposed by such Holder or Holders as the Company may request in writing and as shall be required in connection with any registration, qualification or compliance referred to in this Agreement. 12. Securities Law Compliance. (a) The Holder or Holders of Registrable Securities included in any registration pursuant to this Agreement covenant that they will comply with the Securities Act and with the Exchange Act with respect to any such registration, recognizing that under certain circumstances set forth in Section 10(a)(vi) hereof, the Company may notify such Holder or Holders that the registration statement is not then current. (b) The Holders agree that, immediately upon receipt of a notification as referred to in subparagraph (a) of this Section 12, they will refrain from selling Registrable Securities under a registration statement filed pursuant to Sections 5 or 7 of this Agreement until (i) subsequently notified by the Company that the registration is current or (ii) receipt of a favorable opinion of counsel as hereinbelow provided. The Company agrees that it will consult with the Holders following the giving of any such notification, and that in the event the Holders are of the view that their securities could be sold in compliance with the Securities Act and the Exchange Act without disclosure of the nonpublic information which is the subject of the notification, the parties hereto agree to be bound by an opinion of Kirkpatrick & Lockhart, LLP or other counsel reasonably satisfactory both to a majority of the Holders and to the Company as to whether such sales can be made without violation of the Securities Act or the Exchange Act. 13. Standoff Agreement. Each Holder agrees in connection with any registration of the Company's securities that, upon request of the underwriters managing any underwritten offering of the Company's securities, not to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any Registrable Securities (other than those included in such registration), except in a private sale or transfer, without the prior written consent of the Company or such underwriters, as the case may be, for such period of time (not to exceed 180 days) from the effective date of such registration as may be requested by the Company or such managing underwriters. 14. Rule 144 Requirements. The Company agrees to: (a) comply with the requirements of Rule 144(c) with respect to current public information about the Company; (b) use its best efforts to file with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act; and 9 (c) furnish to any Holder of Registrable Securities upon request (i) a written statement by the Company as to its compliance with the requirements of Rule 144(c), and the reporting requirements of the Securities Act and the Exchange Act, (ii) a copy of the most recent annual or quarterly report of the Company, and (iii) such other reports and documents of the Company as such Holder may reasonably request to avail itself of any similar rule or regulation of the Commission allowing itself to sell any such securities without registration. 15. Put Right and Call Offer. (a) Subject to Section 15(b) below, each Purchaser shall have the right to sell (a "Put Right") during the Put Right Exercise Period (as defined below), and upon exercise of that right the Company shall purchase, all or any portion of the Common Shares then owned by such Purchaser at a purchase price per share equal to 100% of the Average Specified Price during the Put Right Exercise Period (as defined below). If the Put Right is not duly exercised during the Put Right Exercise Period, it shall expire at the end of the Put Right Exercise Period. A Put Right may be exercised only once by each Purchaser. (b) The Company may offer to purchase from each Purchaser or from all of the Purchasers (a "Call Offer") during the Call Offer Period all or any portion of the Common Shares then owned by such Purchasers at a purchase price equal to 110% of the Average Specified Price (as defined below). The Purchasers may, at their option, accept such Call Offer upon written notice delivered to the Company within twenty business days after notice of the Call Offer is given to the Purchasers. If any Purchaser does not duly accept the Call Offer in accordance with the terms of the Call Offer and this Agreement, or if any such Purchaser accepts the Call Offer but subsequently does not sell to the Company the Common Shares agreed to be sold by such Purchaser to the Company within the period provided for in this Section 15, then both the Call Offer and all rights of the Purchasers under Section 15(a) with respect to the shares subject to such Call Offer shall then immediately expire and be of no further force and effect. (c) The "Average Specified Price" for each Common Share subject to a Put Right or a Call Offer shall be $20.91875, which is equal the average of the closing price for a Common Share as reported by the New York Stock Exchange for each of the twenty trading days ending on the fifth to the last trading day preceding the date of this Agreement. The "Put Right Exercise Period" shall be the 30-day period commencing on the first anniversary date of this Agreement. The "Call Offer Period" shall be the one-year period commencing on the date of this Agreement. A Put Right may be exercised and a Call Offer may be made only by written notice to the Company or the Purchasers, as the case may be, and such notice shall contain the number of Common Shares to be purchased and the identity of the Purchaser selling such Common Shares. The purchase price payable upon purchase and sale of the Common Shares subject to a Put Right or Call Offer hereunder shall be paid in cash on the Closing Date (as defined below). (d) In the event that a Put Right is exercised or a Call Offer is made with reference to Common Shares that are held in escrow pursuant to that certain Indemnity Escrow Agreement dated the date hereof among the Company, the Purchasers, Chicago Title and Trust Company (or successor trustee; "Escrow Agent"), and Continental H\\2\\O Service, Inc., an Illinois corporation (the "Indemnity Escrow Agreement"), then all proceeds payable upon the purchase and sale of the Common Shares subject to such Put Right or Call Offer shall be delivered to the Escrow Agent to be held in Trust under the terms of the Indemnity Escrow Agreement; provided, however, that if a Call Offer is made with reference to Common Shares in Trust under the Indemnity Escrow Agreement, then only so much of the proceeds thereof that equals 100% of the Average Specified Price for such shares shall be delivered to the Escrow Agent to be held in Trust under the terms of the Indemnity Escrow Agreement and the remaining net proceeds thereof shall be distributed to the Purchasers on a Pro Rata Basis (as defined in the Purchase Agreement). (e) In the event of an exercise of a Put Right or the making of a Call Offer, the parties to such transaction shall mutually determine a closing date (a "Closing Date") which shall not be more than 30 days, subject to any applicable regulatory waiting periods, after the date the Put Right is exercised or Call Offer is made, as the case may be, or if any such day is not a business day, then the first business day thereafter. Such closing ("Closing") 10 shall be held at 11:00 a.m., local time, at the principal executive office of the Company, or at such other time or place as the parties may agree. On the Closing Date of a purchase of Common Shares pursuant to this Section, the Purchasers shall deliver to the Company certificates, with stock powers duly endorsed in blank, representing the Common Shares to be purchased. In addition, if the person selling the Shares is the personal representative of a deceased Purchaser, the personal representative shall also deliver to the Company (i) copies of letters testamentary or letters of administration evidencing his appointment and qualification, (ii) a certificate issued by the Internal Revenue Service pursuant to Section 6325 of the Internal Revenue Code of 1986, as amended (the "Code"), discharging the Common Shares being sold from liens imposed by the Code (or, if it is not possible to obtain such certificate by the Closing Date, the sale of such Common Shares may be consummated and the proceeds placed in escrow pending receipt thereof), and (iii) an estate tax waiver issued by the state of the decedent's domicile. 16. Investment Representation. Each Purchaser represents and warrants to the Company that he or she is acquiring the Common Shares for investment only and not with a view to or in connection with any resale or distribution of the Common Shares, and hereby affirms that he or she has no present intention of making any sale, assignment, pledge, gift, transfer or other disposition of the Common Shares or any interest therein. Each Purchaser represents and warrants to the Company that, either (i) his or her current personal net worth, including that of his or her spouse, exceeds $1,000,000, or (ii) (A) his or her total individual income, in each of calendar year 1993 and 1994 exceeded $200,000 or total joint income with his or her spouse in each of those years exceeded $300,000, and (B) he or she reasonably expects that his or her total individual income for calendar year 1995 will exceed $200,000 or that his or her total joint income with his or her spouse for calendar year 1995 will exceed $300,000. 17. Amendment. Any provision of this Agreement may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Holders of a majority of the Registrable Securities then outstanding and held by Holders. Any amendment or waiver effected in accordance with this Section shall be binding upon each Holder of any Registrable Securities then outstanding, each future Holder of all such Registrable Securities, and the Company. 18. Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand, courier service, United States mail or by facsimile, addressed as follows: (i) if to the Corporation, to: United States Filter Corporation 73-710 Fred Waring Drive Suite 222 Palm Desert, CA 92260, U.S.A. Attn: Chief Executive Officer Telecopy: 619-341-9368 with a copy to: Donald L. Bergmann, Esq. Vice President and General Counsel United States Filter Corporation 110 Washington Avenue North Haven, CT 06473 Telecopy: 203-234-0171 11 (ii) if to Purchasers, to: Mr. James Timothy Stockdale 2660 South 17th Avenue Broadview, IL 60153 Telecopy: 708-345-8006 or to such other address of a party of which such party has given notice to the other parties pursuant to this Section. 19. Transferability. Notwithstanding any provision contained in this Agreement to the contrary, it is acknowledged and agreed by the Purchasers that their respective rights and benefits under Section 15 are rights and benefits personal to the Purchasers and may not be assigned or transferred to or held for the benefit of any other person, other than by will and by operation of intestate distribution law, including the laws of descent and distribution. 20. Governing Law. This Agreement shall be governed by and construed in accordance with the laws (other than those with respect to choice of law) of the State of Delaware. Each of the parties hereto agrees that all claims in any action or proceeding arising out of or related to this Agreement may be heard and determined in any Delaware state court or federal court sitting in the State of Delaware. 21. Severability. The provisions of this Agreement are severable, and in the event that any one or more provisions are deemed illegal or unenforceable, the remaining provisions shall remain in full force and effect. 22. Counterparts. This Agreement may be executed simultaneously in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 12 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. UNITED STATES FILTER CORPORATION By: /s/ John S. Swartley ___________________________________ /s/ Florence E. Stockdale _____________________________________ Florence E. Stockdale /s/ James Timothy Stockdale _____________________________________ James Timothy Stockdale /s/ William E. Stockdale III _____________________________________ William E. Stockdale III /s/ John Christopher Stockdale _____________________________________ John Christopher Stockdale /s/ Melody S. Williamson _____________________________________ Melody S. Williamson /s/ Katharine S. Price _____________________________________ Katharine S. Price 13 -----END PRIVACY-ENHANCED MESSAGE-----