Ares Management (ARES) 8-KAres Management Corporation Announces Agreement to Acquire Landmark Partners

On March 30, 2021, Ares Management Corporation (“Ares” or the “Company”) agreed that in connection with the Transaction (as defined below), Ares Holdings, L.P. (“Buyer”), a subsidiary of Ares, will deliver up to an aggregate of 5,523,746 of operating group units of Buyer (“OGUs”) at the closing of the Transaction, subject to certain adjustments. Assuming a full exchange of all outstanding OGUs for shares of Class A common stock of the Company (together with the OGUs and the total number shares of Class A common stock of the Company outstanding as of March 29, 2021, “Total Equity”), the OGUs to be issued in connection with the Transaction represent approximately 2% of the outstanding Total Equity as of March 29, 2021.

The OGUs will be issued in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended, in partial consideration for the sellers’ equity interests in Landmark. Subject to acceleration in certain instances, certain of the OGUs to be delivered at the closing of the Transaction (“Closing”) vest 50% on each of the first and second anniversaries of the Closing and all OGUs will be exchangeable on a one-for-one basis for shares of Class A common stock of the Company upon the election of the holders thereof as follows: (i) 50% following the first anniversary of Closing, (ii) 75% following the secondary anniversary of Closing and (iii) 100% following the third anniversary of Closing, in each case subject to certain exceptions.

In addition, in connection with the Transaction, Ares has established a management incentive plan (“Landmark MIP”) for Landmark partners and other senior professionals of up to $340 million. The substantial majority of the Landmark MIP is expected to be comprised of performance-based Restricted Unit grants under the Company’s 2014 Equity Incentive Plan and such performance-based Restricted Units will be granted subject to the employee’s continued employment with Ares and upon achievement of certain fundraising and revenue targets. If achieved, any performance-based Restricted Units will be granted in 2023 based on a volume weighted average price per share of Ares’ Class A Common Stock at the time of grant, and will be subject to four additional years of vesting tied to continued employment, subject to certain exceptions. Ares also has the option to settle the performance-based Restricted Units in cash.

This Current Report on Form 8-K contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by the use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects,” and similar expressions that do not relate to historical matters. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties, including the Company’s ability to consummate the previously announced acquisition of Landmark by a wholly-owned subsidiary of the Company and to effectively integrate the acquired business into the Company’s operations to achieve the expected benefits therefrom. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance, or achievements. For a further description of such factors, you should read the Company’s filings with the Securities and Exchange Commission. The Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.