Item 1.01 Entry into a Definitive Material Agreement.
Explanatory Note
As previously disclosed, on
As previously disclosed, on
Shareholders Agreement
In connection with the consummation of the Share Issuance and the Multi-Class Share Elimination, the Company entered into the Shareholders Agreement, dated as of the Closing Date, with the entities comprising the AOG that hold Class A Common Shares of the Company (such entities, the "Apollo Shareholders" and such agreement, the "Shareholders Agreement").
Nomination Rights. Pursuant to the Shareholders Agreement, the Apollo Shareholders will have the right to nominate a number of individuals for election to the Board (the "Apollo Nominees") at each election in proportion to the number of Class A Common Shares held or beneficially owned by the Apollo Shareholders (including any Class A Common Shares to which a valid proxy has been granted to any Apollo Shareholder), rounded up to the nearest whole number minus the number of directors nominated by the Apollo Shareholders then serving on the Board on classes of directors whose terms are not expiring at such annual or special general meeting. The Company will reasonably cooperate with, and use commercially reasonable efforts to assist, the Apollo Shareholders to cause the election of the Apollo Nominees to the Board. The Apollo Shareholders' right to nominate the Apollo Nominees will terminate on the earlier of (i) the Apollo Shareholders, controlled affiliates of AGM and each employee and consultant to AGM and the controlled affiliates of AGM no longer continuing to hold or beneficially own (excluding any Class A Common Shares to which a valid proxy has been granted to any of the Apollo Shareholders by any employee of the Company) at least 7.5% of the issued and outstanding Class A Common Shares or (ii) the Apollo Shareholders no longer continuing to hold or beneficially own (including any Class A Common Shares to which a valid proxy has been granted to any Apollo Shareholder) at least 5% of the issued and outstanding Class A Common Shares.
Lock-Up, ROFO and Transfer Restrictions. Pursuant to the Shareholders Agreement, for 3 years after the Closing Date (the "Lock-Up Period"), the Apollo Shareholders may not transfer any Class A Common Shares except (i) after consultation with the Company, and subject to receipt of all required regulatory approvals, to certain
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affiliates and other controlled entities (who will be permitted transferees under the Shareholders Agreement) or (ii) in connection with certain permitted hedging transactions. From and after the expiration of the Lock-Up Period, subject to certain exceptions, the Company will generally have a right of first offer to purchase any Class A Common Shares that any Apollo Shareholder elects to sell (other than to a permitted transferee). If the Company does not exercise its right of first offer, then the Apollo Shareholders will be permitted to transfer their Class A Common Shares, provided that, subject to certain exceptions, the Apollo Shareholders will be prohibited from transferring Class A Common Shares to any competitor of the Company or to any person that would, after giving effect to the transfer, hold 2.5% or more of the issued and outstanding Class A Common Shares.
Facility Right. The Company granted
Item 3.02 Unregistered Sales of
The information set forth under Item 1.01 of this report is incorporated by reference into this Item 3.02. The Class A Common Shares issued pursuant to the Transaction Agreement have not been registered under the Act, and the transactions set forth under Item 1.01 of this report have been taken in reliance upon the exemption from the registration requirements of the Act provided by Section 4(a)(2) thereof as transactions by an issuer not involving any public offering.
Item 3.03 Material Modification to Rights of Security Holders.
The information set forth under Items 1.01 and 5.03 of this report is incorporated by reference into this Item 3.03.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
As previously disclosed, on
• Eliminate the multi-class common share structure of the Company; • Modify the voting cutback that is applicable to persons who own, or are treated as owning, Class A Common Shares that represent more than 9.9% of the total voting power of the Company (the "9.9% Voting Cutback"). As modified, the 9.9% Voting Cutback applies to limit to 9.9% the voting power of the Company owned by persons who, together with their affiliates, beneficially own more than 9.9% of the voting power of the Company, subject to exemptions as authorized by (i) untilMarch 31, 2021 , 70% of the board of directors of the Company (the "Board") and (ii) afterMarch 31, 2021 , 75%, of the Board. The Board is also granted authority to eliminate the 9.9% Voting Cutback, as authorized by (i) untilMarch 31, 2021 , 70% of the Board and (ii) afterMarch 31, 2021 , 75%, of the Board. In connection with such amendments, the Board has (i) resolved to exempt shares beneficially owned by theApollo Group (as
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defined in the Bye-laws) from the 9.9% Voting Cutback and (ii) delegated authority to the Company's independent directors to eliminate the applicability of the 9.9% Voting Cutback altogether in the event that they determine that it is the sole impediment to the Class A Common Shares being listed on theStandard & Poor's 500 Stock Index (or, ifStandard & Poor's then maintains any index with broader representation in terms of market capitalization and number of companies represented, such other index); • Modify and narrow the existing rule that deems certain Class A Common Shares to be non-voting so that it applies only when the 9.9% Voting Cutback is in effect with respect to one or more persons and only to Class A Common Shares owned, or treated as owned, by persons (other than AGM, its affiliates, and persons who have granted AGM a valid proxy) who own, or are treated as owning, shares of AGM; • Add a voting cutback that would apply only when the 9.9% Voting Cutback is in effect with respect to one or more persons and would limit to 49.9% the voting power of the Company owned, or treated as owned, by certain persons or groups of persons who do not own more than 50% of the value of the Company's shares; • Add certain procedural requirements necessary for shareholders to take action by written resolution; • Permit certain provisions relating to the nomination of directors to be modified by the Shareholders Agreement; • Eliminate certain transfer restrictions applicable to transfers of common shares of the Company that would result in 19.9% or more of the total voting power or value of the Company being owned, or treated as owned, by persons who are either (i) both "United States shareholders" of the Company under Section 953(c) of the Internal Revenue Code of 1986, as amended (the "Code"), and Related Insured Entities (as defined in the Bye-laws) or (ii) both related to "United States shareholders" of the Company under Section 953(c) of the Code and Related Insured Entities; • Make technical modifications to the restrictions on transactions between the Company and theApollo Group (as defined in the Bye-laws) as a result of the elimination of the multi-class common share structure of the Company; • Modify the provisions of the Bye-laws that require the Company to refer the subject matter of certain matters with respect to its subsidiaries upon which it has the right to vote to its shareholders, and vote in accordance with the votes of its shareholders, so that those provisions apply only when the 9.9% Voting Cutback is in effect with respect to one or more persons; and • Update the list of insurance subsidiaries and ceding companies attached as Schedule 1 to the Bye-laws.
The Thirteenth Amended and Restated Bye-laws became effective upon the closing of the Share Issuance on the Closing Date. The foregoing description of the Thirteenth Amended and Restated Bye-laws is not complete and is qualified in its entirety by reference to the Thirteenth Amended and Restated Bye-Laws of the Company, which are filed as Exhibit 3.1 hereto in unmarked form and as Exhibit 3.2 hereto in redline form showing the amendments referred to above and are incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits 3.1 Thirteenth Amended and Restated Bye-laws, effectiveFebruary 28, 2020 3.2 Thirteenth Amended and Restated Bye-laws, redlined for amendments, effectiveFebruary 28, 2020 104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
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