Company: AWK
Filing Date: 2025-12-17
Form Type: S-4
Source: 0001193125-25-321389
Chunk: 111

Company: American Water Works Company, Inc.
Filing Date: 2025-12-17
Form: S-4
Chunk 111
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 continuing to have, in achieving significant growth on a standalone basis and the likely effect of these factors on Essential both with and without the merger;                            |

| • |     | the combined company would have the scale, balance sheet strength, financial flexibility, and free cash flow to                                                                                                                                          
 fund future growth and improved ability to access the capital markets on more favorable terms than available to Essential as an independent company, which would allow the combined company to be more competitive in capturing strategic opportunities; |

| • |     | the possible alternatives to the merger, including, in addition to remaining an independent company, entering                                                                                                                                         
 into a strategic transaction with another party, and the timing and likelihood of obtaining any required regulatory approvals and consummating any such strategic transaction, all of which alternatives the Essential board evaluated and determined 
 were less favorable to Essential’s shareholders than the merger, given the potential benefits, risks and uncertainties associated with those alternatives;                                                                                            |

| • |     | the reverse due diligence conducted by Essential management and Essential’s outside advisors in respect of 
 American Water’s business;                                                                                 |

| • |     | five Essential directors, including Christopher H. Franklin, the current Chairman of the Essential board and                                                                                                                                        
 President and Chief Executive Officer of Essential, would join the American Water board following the effective time, with Mr. Franklin to be Executive Vice Chair of the American Water board, thereby providing Essential with meaningful         
 representation on the combined company’s board of directors and helping to ensure that the combined company has the opportunity to benefit from the insights and experience of members of the Essential board. For additional information regarding 
 the terms of Mr. Franklin’s go-forward employment with American Water, see “The Merger—Interests of Directors and Executive Officers in the Merger—Interests of Essential                                                                           
 Directors and Executive Officers in the Merger—New Management Arrangements” beginning on page 108;                                                                                                                                                  |

| • |     | the merger agreement provides for the establishment of an integration planning committee consisting of members of                                                                            
 Essential and American Water senior management to seek to achieve the realization of synergies, operating efficiencies and other benefits expected to be realized as a result of the merger; |

| • |     | the assessment of the Essential board, after considering the advice of regulatory counsel, regarding the                                                                                                                                          
 likelihood of obtaining HSR clearance and the required state regulatory approvals, including taking into account the obligations imposed on American Water under the merger agreement to use its reasonable best efforts to obtain the regulatory 
 approvals, as described in greater detail in “The Merger