Filed by Essential Utilities, Inc.
pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-6(b)
under the Securities Exchange Act of 1934
Subject Company: Essential Utilities, Inc.
Commission File No.: 001-06659
Date: April 10, 2026
TO: All Essential Employees
FROM: Chris Franklin
SUBJECT: Integration Planning Update – Survey Thank You & Updates
Colleagues,
As we continue to make progress on our integration planning efforts, I wanted to pause and express my sincere appreciation to everyone
at Essential who took the time to complete our recent Organizational Health Index (OHI) survey. I’m pleased to
share that we had an 80% response rate, which reflects your engagement, interest, and care in shaping our future
together. We truly value your candid feedback and will share key themes and insights after we have fully analyzed
and reviewed your responses.
Additionally, with integration planning moving forward, we’ve added two workstreams to the Integration
Management Office (IMO). The first workstream will focus on branding, which will be led by Dave Kralle.
This group will consider how Essential’s image will transition after closing. This work will take some time, but
we will provide you with information as progress is made. The second workstream we added will focus on regulatory matters and
will be led by Bill Packer and Kim Joyce.
Lastly, we are working with our counterparts at American Water to develop
the end state vision for each operating group and functional area. As a critical milestone, we have an all-day summit
on this topic in Camden next week. At next week’s workshop, our core integration teams will
share early feedback on how our processes align, present initial end state plans, and map our technology blueprint through
enterprise, system, and functional requirements and considerations.
Many of you have asked me to provide even more information than we
have been providing. However, we are following a very methodical process to consider each issue carefully and thoughtfully.
This process takes time. I understand your desire for more information, but I am respectfully requesting your patience. I’m proud
of the progress we’re making, and proud of the teams from Essential and American who are working collaboratively
together to craft the vision for the combined company. We’ll be sure to share details as they become available in
the weeks ahead. Thank you for your continued commitment and support.
Best,
Chris
Cautionary Statement Regarding Forward-Looking Statements
Certain statements included in this communication are 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, as amended, and the Private Securities Litigation Reform Act
of 1995. In some cases, these forward-looking statements can be identified by words with prospective meanings such as “intend,” “plan,” “estimate,” “believe,” “anticipate,” “expect,” “predict,” “project,” “propose,” “assume,” “forecast,” “outlook,” “future,” “likely,” “pending,” “goal,” “objective,” “potential,” “continue,” “seek
to,” “may,” “can,” “will,” “should” and “could,” or the
negative of such terms or other variations or similar expressions. Forward-looking statements may relate to, among other things: statements
about the benefits of the proposed merger, including future financial and operating results; the parties’ respective plans,
objectives, expectations and intentions; the expected timing and likelihood of completion of the merger and related transactions; the
results of any strategic review; expected synergies of the proposed merger; the timing and result of various regulatory proceedings related
to the proposed merger, and other general rate cases, filings for infrastructure surcharges and other governmental agency authorizations
and proceedings, and filings to address regulatory lag; the combined company’s ability to execute its current and long-term business,
operational, capital expenditures and growth plans and strategies; the amount, allocation and timing of projected capital expenditures
and related funding requirements; the future impacts of increased or increasing transaction and financing costs associated with the proposed
merger or otherwise, as well as inflation and interest rates; each party’s ability to finance current and projected operations,
capital expenditure needs and growth initiatives by accessing the debt and equity capital markets and sources of short-term liquidity;
impacts of the proposed merger on the future settlement or settlements of a party’s forward sale agreements, including potential
adjustments to the forward sale price or other economic terms thereunder, and the amount of and the intended use of net proceeds from
any such future settlement or settlements; the outcome and impact on other governmental and regulatory investigations; the filing
of class action lawsuits and other litigation and legal proceedings related to the proposed merger; the ability to complete, and the timing
and efficacy of, the design, development, implementation and improvement of technology and other strategic initiatives; each party’s
ability to comply with new and changing environmental regulations; regulatory, legislative, tax policy or legal developments; and impacts
that future significant tax legislation may have on each such party and on its business, results of operations, cash flows and liquidity.
These forward-looking statements are predictions based on currently available information, the parties’ current respective
expectations and assumptions regarding future events that American Water Works Company, Inc. (“American Water”)
and Essential Utilities, Inc. (“Essential Utilities”) believe to be reasonable. They are not, however, guarantees or
assurances of any outcomes, performance or achievements, and readers are cautioned not to place undue reliance upon them. You should not
regard any forward-looking statement as a representation or warranty by American Water, Essential Utilities or any other person
that the expectation, plan or objective expressed in such forward-looking statement will be successfully achieved
in any specified time frame, or at all. The forward-looking statements are subject to a number of estimates and
assumptions, and known and unknown risks, uncertainties and other factors. Actual results may differ materially from
those discussed in the forward-looking statements included in this communication as a result of the factors discussed in American Water’s
Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission (the “SEC”)
on February 18, 2026 (available at: ir.amwater.com), Essential Utilities’ Annual Report on Form 10-K for the year ended
December 31, 2025, as filed with the SEC on February 26, 2026 (available at: essential.co), and each party’s other filings
with the SEC, and additional risks and uncertainties, including with respect to (1) the parties’ ability to consummate the
proposed merger pursuant to the terms of the definitive merger agreement or at all; (2) each party’s requirement to obtain required
governmental and regulatory approvals required for the proposed merger (and/or that such approvals may result in the imposition of burdensome
or commercially undesirable conditions, including required dispositions, that could adversely affect the combined company or the expected
benefits of the proposed merger); (3) an event, change or other circumstance that could give rise to the termination of the merger agreement;
(4) the failure to satisfy or waive a condition to closing of the proposed merger on a timely basis or at all; (5) a delay in the
timing to consummate the proposed merger; (6) the failure to integrate the parties’ businesses successfully; (7) the failure
to fully realize benefits, efficiencies and cost savings from the proposed merger or that such benefits, efficiencies and cost savings
may take longer to realize or be more costly to achieve than expected; (8) negative or adverse impacts of the announcement of the proposed
merger on the market price of American Water’s or Essential Utilities’ common stock; (9) the risk of litigation, legal
proceedings or other challenges related to the proposed merger; (10) disruption from the proposed merger making it more difficult to maintain
relationships with customers, employees, contractors, suppliers, regulators, vendors, elected officials, governmental agencies, or other
stakeholders; (11) the diversion of each party’s management’s time and attention from ongoing business operations and opportunities
of such party on merger-related matters; (12) the challenging macroeconomic environment, including disruptions in the water and wastewater
utility industries; (13) the ability of each party to manage its respective existing operations and financing arrangements on favorable
terms or at all, including with respect to future capital expenditures and investments, operations, and maintenance costs; (14) changes
in environmental laws and regulations regarding each party’s respective operations that may adversely impact such party’s
businesses or increase the cost of operations; (15) changes in each party’s key management and personnel; (16) changes in tax laws
that could adversely affect beneficial tax treatment of the proposed merger; (17) regulatory, legislative, local or municipal actions
affecting the water and wastewater industries, which could adversely affect the parties’ respective utility subsidiaries;
and (18) other economic, business and other factors, including inflation, interest rate fluctuations or tariffs. The foregoing factors
should not be construed as exhaustive.
These forward-looking statements are qualified by, and should be read together with, the risks and uncertainties set forth above and the
risk factors included in American Water’s and Essential Utilities’ respective annual and quarterly reports as filed
with the SEC and in the definitive joint proxy statement/prospectus, as filed with the SEC on December 31, 2025 (available at: https://www.sec.gov/Archives/edgar/data/1410636/000119312525337598/d15683d424b3.htm),
and readers should refer to such risks, uncertainties and risk factors in evaluating such forward-looking statements. Any forward-looking
statements speak only as of the date this communication is first used or given. Neither American Water nor Essential Utilities has any
obligation or intention to update or revise any forward-looking statement, whether as a result of new information, future
events, changed circumstances or otherwise, except as otherwise required by the federal securities laws. New factors emerge from
time to time, and it is not possible for American Water or Essential Utilities to predict all such factors. Furthermore, it may not be
possible to assess the impact of any such factor on American Water’s or Essential Utilities’ businesses, viewed independently
or together, or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained
in any forward-looking statement.
Proposed Merger
For additional information regarding the proposed merger, please see American Water’s registration statement
on Form S-4 (Registration No. 333-292182), which was declared effective by the SEC on December 30, 2025, and the other documents
that American Water or Essential Utilities has filed or may file with the SEC.
No Offer or Solicitation
This communication is for informational purposes and is not intended to, and shall not, constitute an offer to sell or the solicitation
of an offer to buy any securities, nor shall there be any offer or sale of securities in any jurisdiction in which such offer, solicitation
or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities
shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.
