file8k_aug1-2008.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date
of
Report (Date of earliest event reported): August 1, 2008
ARTESIAN
RESOURCES
CORPORATION
(Exact
name of registrant as specified in its charter)
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Delaware
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000-18516
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51-0002090
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(State
or other jurisdiction ofincorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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664
Churchmans Road, Newark, Delaware
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19702
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant's
telephone number, including area code:
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302-453-6900
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Not
Applicable
¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾¾
(Former
name or former address, if changed since last report.)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
o
Written communications
pursuant to Rule 425 under the Securities Act
o
Soliciting material
pursuant to Rule 14a-12 under the Exchange Act
o
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
o
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
Item
1.01 Entry Into a Material Definitive Agreement
On
August
1, 2008, Artesian Water Maryland, Inc. (“Artesian Maryland”), a subsidiary of
Artesian Resources Corporation (“Artesian Resources”), completed its acquisition
of all the outstanding membership interests of Mountain Hill Water Company,
LLC
(“Mountain Hill”) from its sole member, Sunrise Holdings, L.P. (“Sunrise”), for
a purchase price of approximately $7.093 million. The acquisition
included a 0.3 million gallon per day water treatment facility, four wells
with
a capacity of up to 500,000 gallons per day, a 500,000 gallon elevated storage
tank and approximately eight miles of main, all situated within the core of
Cecil County’s designated growth corridor. The acquisition provides
Artesian Maryland the right to serve the entire 8,000 acres owned by Sunrise
or
its associates. Mountain Hill serves two commercial accounts in the
Principio Business Park, located within Cecil County, Maryland’s designated
growth corridor. Mountain Hill will also provide water service to
future customers in the Principio Business Park and will provide water service
to the proposed 660 home residential development of Charlestown Crossing as
well
as the surrounding area.
Approximately
$4.772 million of the total purchase price was paid at closing. In
addition, on the closing date, Artesian Maryland executed a promissory note
in
the amount of approximately $2.321 million to Sunrise (the “Note”) that bears
interest at a variable interest rate based upon the London Interbank Offering
Rate plus 150 basis points. The Note is payable in four equal annual
installments, commencing on the first anniversary of the closing
date. The Note is secured by a first lien security interest in all of
Mountain Hill’s assets in favor of Sunrise and is guaranteed by Artesian
Resources.
As
a
condition to the purchase, Artesian Maryland further agreed that, subject to
certain conditions, at the request of Sunrise or one if its designated
affiliates, Mountain Hill or one of its affiliates would supply water to any
user located in any territory within Cecil County that is served by Mountain
Hill or one of its affiliates. This obligation is guaranteed by
Artesian Resources and will remain in place as long as Mountain Hill or one
of
its affiliates own water infrastructure in Cecil County Maryland.
On
the
closing date, Artesian Resources executed a Guaranty in favor of Sunrise that
evidences the guarantee arrangements described above.
A
copy of
the Purchase Agreement, attached as Exhibit 10.1 to Artesian Resources’ Form 8-K
filed with the Securities and Exchange Commission on May 9, 2008, is
incorporated herein by reference. The foregoing description of the Purchase
Agreement is qualified in its entirety by reference to the full text of the
Purchase Agreement.
SPECIAL
NOTE REGARDING FORWARD LOOKING STATEMENTS
This
Current Report on Form 8-K includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E
of
the Securities Exchange Act of 1934, including statements regarding future
water
service by Mountain Hill. The forward-looking statements are subject to various
risks and uncertainties including delayed or reduced development plans and
other
specific factors described in Artesian Resources’ 2007 Annual Report on Form
10-K. Such information contained herein represents Artesian
Resources’ management’s best judgment as of the date hereof based on information
currently available. Artesian Resources does not intend to update
this information.
Item
9.01 Financial Statements and Exhibits
(d)
Exhibits.
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10.1
Limited Liability Interest Purchase Agreement, dated May 5, 2008
by and
among Artesian Maryland, Inc., a Delaware, Mountain Hill Water Company,
LLC, a Maryland limited liability company, Sunrise Holdings, L.P.,
a
Pennsylvania limited partnership and Artesian Resources Corporation,
a
Delaware corporation, for the limited purposes set forth therein
(Incorporated by reference to Exhibit 10.1 to the Artesian Resources’ Form
8-K filed with the Securities and Exchange Commission on May 9, 2008).
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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ARTESIAN
RESOURCES CORPORATION
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Date: August
7, 2008
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By: /s/
David B. Spacht
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David
B. Spacht
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Chief
Financial Officer
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