EXHIBIT INDEX
Exhibit No. Description
8.1 Opinion of Drummond Woodsum & MacMahon
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Arthur Andersen LLP
23.4 Consent of Salomon Smith Barney
23.5 Consent of SG Barr Devlin
99.1 Form of Proxy of PSC
99.2 Form of Proxy of Consumers
Exhibit 8.1
[OPINION OF DRUMMOND WOODSUM & MACMAHON]
_________________, 1998
Consumers Water Company
Three Canal Plaza, P.O. Box 599
Portland, ME 04112
Ladies and Gentlemen:
We are furnishing this opinion to you in connection with the acquisition of
Consumers Water Company, a Maine corporation ("Consumers"), by Philadelphia
Suburban Corporation, a Pennsylvania corporation ("PSC"). The acquisition will
take place as a result of the merger of Consumers with and into Consumers
Acquisition Company, A Pennsylvania corporation ("Acquisition"), which is a
wholly-owned subsidiary of PSC.
PSC, Acquisition and Consumers have entered into an Agreement and Plan of
Merger dated as of June 27, 1998, as amended by an Amended and Restated
Agreement and Plan of Merger dated August 5, 1998 (the "Agreement"). Terms
defined in the Agreement and used but not defined in this opinion have the
respective meanings set forth in the Agreement.
We have served as counsel for Consumers in the transactions described in
the Agreement. In such role, we have examined the Agreement and such other
documents and records as we deem necessary in order to render the opinions
stated herein.
In rendering our opinion, as set forth below, we have made the following
assumptions:
A. That all documents submitted to us as originals are genuine and that all
documents submitted to us as copies conform to the originals.
B. That all representations made in the Agreement by PSC, Acquisition and
Consumers are correct and will be true and correct as of the Closing and as of
the Effective Time.
C. That all representations and certifications made to us in Certificates
furnished by certain officers of Consumers and PSC (the "Certificates") are
true, correct and complete.
D. That there is no plan or intention on the part of Consumers'
shareholders to sell, exchange or otherwise dispose of the shares of PSC Common
Stock to be received in the Merger that will reduce Consumers' shareholders'
holdings to a number of shares of PSC Common Stock having a value as of the date
of the Closing, of less than fifty percent (50%) of the value of all of the
formerly outstanding stock of Consumers as of the same date. For purposes of
this assumption, shares of Consumers stock exchanged for cash or other property,
surrendered by dissenters or exchanged for cash in lieu of fractional shares of
PSC Common Stock have been treated as outstanding Consumers stock on the date of
the Closing.
Based on the foregoing and upon the Certificates, we are of the opinion
that: (1) the Merger will constitute a reorganization within the meaning of
Section 368(a)(1)(A) and 368(a)(2)(D) of the Code; and (2) the shareholders of
Consumers will not be subject to Federal income tax on receipt of PSC Common
Shares in exchange for
Consumers Common Shares or Consumers Preferred Shares pursuant to the Merger,
except to the extent that such shareholders receive cash in lieu of fractional
shares of PSC Common Shares to which they would otherwise be entitled.
This opinion relates only to the laws of the State of Maine and the United
States, enacted as of the date hereof and the interpretation thereof as of this
date, and the facts actually known to us as of this date. An opinion represents
only the best legal judgment of counsel, and is not binding on the courts, and
there is no assurance that a court would not reach a result contrary to such an
opinion. We express no opinion with respect to the laws of any other
jurisdiction. We undertake no obligation to revise or update this opinion to
reflect any facts or circumstances which may hereafter come to our attention or
any changes in laws or regulations or in the interpretations thereof which may
hereafter occur. This opinion is solely for your benefit in connection with the
transaction contemplated under the Agreement and may not be relied upon by any
other person.
Very truly yours,
Exhibit 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Philadelphia Suburban Corporation:
We consent to incorporation by reference in this Registration Statement on Form
S-4 of Philadelphia Suburban Corporation of our report dated January 28, 1998,
relating to the consolidated balance sheets and statements of capitalization of
Philadelphia Suburban Corporation and subsidiaries as of December 31, 1997 and
1996 and the related consolidated statements of income and cash flow for each of
the years in the three-year period ended December 31, 1997 which report is
incorporated by reference in the December 31, 1997 Annual Report on Form 10-K of
Philadelphia Suburban Corporation.
We also consent to the reference to our firm under the heading "Experts"
appearing elsewhere herein.
/s/ KPMG PEAT MARWICK LLP
Philadelphia, Pennsylvania
September 10, 1998
Exhibit 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the reference to our firm under the caption "Experts" in the Joint
Proxy Statement/Prospectus of Philadelphia Suburban Corporation and Consumers
Water Company which is made part of this Registration Statement for the
registration of shares of Philadelphia Suburban Corporation and to the
incorporation by reference therein of our report dated February 5, 1998, with
respect to the consolidated financial statements of Consumers Water Company and
Subsidiaries included in its Annual Report on Form 10-K for the year ended
December 31, 1997, filed with the Securities and Exchange Commission.
/s/ ARTHUR ANDERSEN LLP
---------------------------------
Boston, MA
September 10, 1998
Exhibit 23.4
CONSENT OF SALOMON SMITH BARNEY INC.
We hereby consent to the use of our name and the name of Salomon Brothers
Inc. and Smith Barney Inc. which were merged together on September 1, 1998 and
changed their name to Salomon Smith Barney Inc. and to the description of our
opinion letter, dated the date of the Proxy Statement/Prospectus referred to
below, under the caption "THE MERGER - Opinion of Salomon Smith Barney" in, and
to the inclusion of such opinion letter as Appendix B to, the Proxy
Statement/Prospectus of Philadelphia Suburban Corporation, which Proxy
Statement/Prospectus is part of the Registration Statement on Form S-4 (File
Number ___) of Philadelphia Suburban Corporation. By giving such consent we do
not thereby admit that we are experts with respect to any part of such
Registration Statement within the meaning of the term "expert" as used in, or
that we come within the category of persons whose consent is required under, the
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission promulgated thereunder.
/s/ SALOMON SMITH BARNEY
------------------------------
September 10, 1998
Exhibit 23.5
CONSENT OF SG BARR DEVLIN
We hereby consent to the inclusion of our opinion letter to the Board of
Directors of Consumers Water Company ("Consumers") as Annex C to the Joint Proxy
Statement/Prospectus relating to the proposed merger of Consumers into a wholly
owned subsidiary of Philadelphia Suburban Corporation contained in the
Registration Statement on Form S-4 (File No. 333-_______), and to the references
to our firm and such opinion in such Joint Proxy Statement/Prospectus. In giving
such consent, we do not admit that we come within the category of persons whose
consent is required under Section 7 of the Securities Act of 1933, as amended
(the "Act"), or the rules and regulations of the Securities and Exchange
Commission thereunder (the "Regulations"), nor do we admit that we are experts
with respect to any part of such Registration Statement within the meaning of
the term "experts" as used in the Act or the Regulations.
/s/ SG BARR DEVLIN
-------------------------------
September 10, 1998
Exhibit 99.1
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PHILADELPHIA SUBURBAN CORPORATION
762 LANCASTER AVENUE
BRYN MAWR, PA
The undersigned hereby appoints Nicholas DeBenedictis, Roy H. Stahl and
Patricia M. Mycek, and each of them acting alone, with the power to appoint his
or her substitute, proxy to represent the undersigned and vote as designated
below all of the shares of common stock of Philadelphia Suburban Corporation
("PSC") held of record by the undersigned on September 18, 1998, at the Special
Meeting of Shareholders to be held on November 16, 1998 and at any adjournment
or postponement thereof.
1. Approval of the Amended and Restated Agreement and Plan of Merger, dated as
of August 5, 1998 (the "Merger Agreement"), by and among PSC, Consumers
Acquisition Company ("Acquisition") and Consumers Water Company
("Consumers"), providing for the merger of Consumers with and into
Acquisition, a wholly-owned subsidiary of PSC (the "Merger").
|_| FOR
|_| AGAINST
|_| ABSTAIN
2. Approval of an amendment to PSC's Articles of Incorporation increasing the
authorized shares of PSC common stock, par value $.50 per share ("PSC Common
Stock") from 40,000,000 to 100,000,000.
|_| FOR
|_| AGAINST
|_| ABSTAIN
3. Approval of an amendment to PSC's 1994 Equity Compensation Plan (the "Equity
Compensation Plan") to increase from 1,900,000 to 2,900,000, the aggregate
authorized shares of the PSC Common Stock that may be issued or transferred
under the Equity Compensation Plan and to adopt certain other amendments to
the terms of the Equity Compensation Plan necessary for the issuance of
options to holders of options to purchase Consumers Common Stock pursuant to
the Merger Agreement.
|_| FOR
|_| AGAINST
|_| ABSTAIN
4. In his or her discretion, the proxy is authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
"FOR" EACH OF PROPOSAL 1, PROPOSAL 2 AND PROPOSAL 3.
Dated:
--------------------------
--------------------------------
Signature
--------------------------------
Signature if held jointly
Please sign exactly as name appears
to the left. When shares are held by
joint tenants, both should sign.
When signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full
corporate name by President or other
authorized officer. If a
partnership, please sign in
partnership name by authorized
person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
Exhibit 99.2
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
CONSUMERS WATER COMPANY
THREE CANAL PLAZA
PORTLAND, MAINE 04101
The undersigned, hereby revoking any proxy heretofore given, hereby
appoints John E. Palmer, Jr., John E. Menario and Peter L. Haynes, and each of
them severally, proxies of the undersigned, with full power of substitution, to
vote as indicated below all of the shares of common stock and shares of
Cumulative Preferred Stock, Series A, of Consumers Water Company ("Consumers")
which the undersigned would be entitled to vote if personally present, at the
Special Meeting of Shareholders to be held on November 16, 1998 and at any
adjournment or postponement thereof.
The Board of Directors recommends a vote FOR Proposal 1
1. Approval of the Amended and Restated Agreement and Plan of Merger, dated as
of August 5, 1998, by and among Philadelphia Suburban Corporation ("PSC"),
Consumers Acquisition Company ("Acquisition") and Consumers, providing for the
merger of Consumers with and into Acquisition, a wholly-owned subsidiary of PSC.
|_| FOR
|_| AGAINST
|_| ABSTAIN
DISCRETIONARY AUTHORITY IS HEREBY CONFERRED UPON THE PROXY HOLDERS WITH RESPECT
TO SUCH OTHER MATTERS AS MAY LEGALLY COME BEFORE THIS MEETING. THIS PROXY WHEN
PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED
SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR" PROPOSAL 1.
Dated:
-----------------------
-------------------------------
Signature
-------------------------------
Signature if held jointly
Please sign exactly as name
appears to the left. When
shares are held by joint
tenants, both should sign. When
signing as attorney, executor,
administrator, trustee or
guardian, please give full
title as such. If a
corporation, please sign in
full corporate name by
President or other authorized
officer. If a partnership,
please sign in partnership name
by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
