TORONTO, March 22, 2019 /CNW/ - Victor Koloshuk and Koloshuk Farrugia Corp. (together, the "Seller"), of 70 University Avenue, Suite 1200, Toronto, Ontario M5J 2M4, today announced that on March 21, 2019 it entered into a hard lock-up agreement (the "Lock-Up Agreement") with Fiera Capital Corporation ("Fiera Capital") relating to the proposed acquisition by Fiera Capital of all of the outstanding common shares ("IAM Shares") of Integrated Asset Management Corp. ("IAM") by way of a statutory plan of arrangement under the Business Corporations Act (Ontario) (the "Transaction") pursuant to the terms and conditions set out in an arrangement agreement dated March 21, 2019 between IAM and Fiera Capital (the "Arrangement Agreement").
The Lock-Up Agreement requires the Seller to, among other things, (a) vote, or caused to be voted, the IAM Shares owned by Seller in favour of the approval of the Transaction, (b) vote, or caused to be voted, the IAM Shares owned by the Seller against any Acquisition Proposal (as defined in the Lock-Up Agreement) other than the Transaction, and (c) not to solicit any proposal or offer with respect to any Acquisition Proposal.
The Lock-Up Agreement automatically terminates at the earliest of (v) six months after the date of the Lock-Up Agreement, (w) delivery of notice by the Seller to Fiera Capital, if, without the prior written consent of the Seller, there is any decrease in the amount of, or change in form of, the consideration payable to the Seller as set out in the Arrangement Agreement, * delivery of notice by the Seller to Fiera Capital, if, without the prior written consent of the Seller, the terms of the Arrangement Agreement have been varied in a manner that is materially adverse to the Seller, (y) the completion of the Transaction, or (z) the termination of the Arrangement Agreement pursuant to certain limited termination provisions set out therein. The Lock-Up Agreement may also be terminated by either party in certain circumstances where the other party is in breach of its obligations or representations and warranties set out therein, subject to applicable cure periods.
The foregoing is a summary of the material terms of the Lock-Up Agreement only and is qualified in its entirety by the full text of the Lock-Up Agreement, which will be made available under IAM's profile at www.sedar.com.
Pursuant to the Transaction, the Seller shall dispose of 9,728,181 IAM Shares and 500,000 options to acquire IAM Shares ("IAM Options"), representing the entirety of its equity interest in IAM.
Prior to entering into the Lock-Up Agreement, the Seller had, directly or indirectly, beneficial ownership of (a) 9,728,181 IAM Shares, and (b) 500,000 IAM Options, together representing approximately 36.4% of the issued and outstanding IAM Shares on a partially-diluted basis. Immediately after the completion of the Transaction, the Seller will not have direct or indirect registered or beneficial ownership of any IAM Shares or IAM Options.
Pursuant to the Transaction, the Seller will receive, at its election: (i) $2.576 in cash per IAM Share, subject to proration such that the aggregate cash paid under the Transaction will not exceed $55.5 million; (ii) a number of Class A subordinate voting shares ("Fiera Capital Shares") of Fiera Capital (or a fraction of a Fiera Capital Share) equal to $2.576 per IAM Share divided by the volume-weighted average trading price of the Fiera Capital Shares on the Toronto Stock Exchange over the five trading days immediately preceding the business day immediately preceding the effective date of the Transaction (the "5-Day VWAP"), subject to proration such that the aggregate number of Fiera Capital Shares issued under the Transaction will not exceed $18.5 million in value; or (iii) $1.932 in cash per IAM Share and a number of Fiera Capital Shares (or a fraction of a Fiera Capital Share) equal to $0.644 per IAM Share divided by the 5-Day VWAP. The aggregate value of the consideration payable to the Seller in respect of the disposition of its IAM Shares pursuant to the Transaction, whether in cash or Fiera Capital Shares, equals $25,059,794.30.
In addition, the Seller will receive contingent consideration in the form of one contingent value right ("CVR") for each IAM Share held. The CVRs to be received by the Seller represent the contingent right of the Seller to receive its pro rata portion of the aggregate cash payments from Fiera Capital which are based on the incentive fees (net of employee bonuses, certain taxes and expenses) (the "Net Incentive Fees") received by IAM affiliates in connection with the management of two real estate funds. The amount that may become payable to the Seller in respect of such CVRs at a future date is uncertain and will depend on a number of factors, including the fair market value of the underlying real estate at the time any Net Incentive Fee is calculated.
The Seller's outstanding IAM Options will be exchanged for IAM Shares based on the in-the-money amount of such IAM Options and cash in an amount equal to a special dividend, if any, that would otherwise have been paid on such IAM Shares. The Seller will then sell such IAM Shares to Fiera Capital as described above.
The dispositions of securities of IAM by the Seller, as described in this news release, are anticipated to occur pursuant to the Transaction. The Seller has entered into the Lock-Up Agreement in order to facilitate the Transaction, as disclosed above. The Seller does not have any intention to acquire additional securities of IAM.
SOURCE Victor Koloshuk
For further information: or to obtain a copy of the subject early warning report, please contact: Victor Koloshuk, 70 University Avenue, Suite 1200, Toronto, Ontario M5J 2M4, Telephone: 416.933.8270, Email: [email protected]