Form 4: Apollo Global Management Insider Enters Forward Sale Contract for Up to 500,000 Shares

Joshua Harris, through affiliated entities, entered into a forward sale contract involving up to 500,000 shares of Apollo Global Management common stock.

Summary

• On July 22, 2024, MJH Partners III LLC, a subsidiary of MJH Partners II LLC, entered into a delayed draw variable share forward sale transaction with an unaffiliated bank.
• The agreement relates to up to 500,000 shares of Apollo Global Management, Inc. common stock.
• MJH Partners III is obligated to deliver up to 500,000 shares of common stock (or cash equivalent) to settle the agreement.
• MJH Partners III pledged 500,000 shares of common stock to secure its obligations under the agreement but retains voting and ordinary dividend rights.
• The number of shares to be delivered depends on the Settlement Price, Floor Price, and Cap Price as defined in the agreement.
• The settlement can be in cash or shares depending on whether a prepayment has been paid by the bank.
• Joshua Harris exercises voting and investment control over MJH Partners II LLC and its subsidiaries.
• The reporting persons disclaim beneficial ownership except to the extent of their pecuniary interest.

Sentiment

Score: 5

Explanation: The sentiment is neutral as it reflects a standard financial transaction. The insider is monetizing shares but retaining some exposure to the stock's upside.

Risks

• The value received from the forward sale contract is dependent on the future stock price of Apollo Global Management.
• The structure of the forward sale contract involves complex calculations based on the Settlement Price, Floor Price, and Cap Price, which could lead to unexpected outcomes.
• There is a risk that the bank's hedging activities could impact the stock price.

Future Outlook

The future obligation to deliver shares or cash is contingent on the terms of the forward sale contract and the future stock price of Apollo Global Management.

Management Comments

• Each of the Reporting Persons disclaims beneficial ownership of the reported securities except to the extent of his or its pecuniary interest therein.
• This report shall not be deemed an admission that the Reporting Persons are a member of a group or the beneficial owner of any securities not directly owned by the applicable Reporting Person.

Industry Context

Forward sale contracts are often used by insiders to monetize their holdings while retaining some of the potential upside and deferring capital gains taxes.

Comparison to Industry Standards

• Forward sale contracts are a relatively common tool used by executives and major shareholders to manage their equity positions.
• Similar transactions have been undertaken by insiders at companies like Blackstone and KKR.

Stakeholder Impact

• The transaction could have a minor impact on shareholders due to the potential dilution from the shares being sold into the market.
• The impact on employees, customers, suppliers, and creditors is likely to be minimal.

Key Dates