DEF 14A: Ares Management Corporation Announces 2024 Annual Meeting of Stockholders

Ares Management Corporation will hold its 2024 Annual Meeting of Stockholders virtually on June 4, 2024, to elect directors and ratify the selection of Ernst & Young LLP as its independent accounting firm.

Summary

• Ares Management Corporation will hold its 2024 Annual Meeting of Stockholders on June 4, 2024, at 11:30 a.m. Eastern Time, in a virtual format.
• Stockholders can vote on the election of eleven directors for one-year terms expiring in 2025 and the ratification of Ernst & Young LLP as the independent registered public accounting firm for the 2024 fiscal year.
• The board of directors recommends voting FOR the election of each director nominee and FOR the ratification of Ernst & Young LLP's appointment.
• Stockholders of record as of April 5, 2024, are entitled to vote.
• As of the record date, there were 191,145,934 shares of Class A common stock, 1,000 shares of Class B common stock, and 115,120,213 shares of Class C common stock outstanding.
• The Ares Ownership Condition was satisfied as of January 31, 2024, with Ares Voting, current and former Ares personnel, and Ares Owners controlling approximately 41% of the voting power of the Designated Stock.
• The proxy materials are available online, and stockholders can vote via the Internet, phone, or mail.
• A plurality of votes cast is required for the election of directors, and a majority of votes cast is required for the ratification of Ernst & Young LLP.
• The board has adopted a clawback policy that complies with NYSEs new clawback rules promulgated under Section 10D of the Exchange Act and the rules promulgated thereunder.

Sentiment

Score: 7

Explanation: The document is a routine corporate communication, presenting standard proposals for stockholder voting. The tone is professional and informative, suggesting a neutral to slightly positive sentiment.

Positives

• The annual meeting will be held virtually, providing greater access for stockholders.
• The board is recommending a vote for all director nominees and the ratification of the accounting firm, indicating confidence in their performance.
• The Ares Ownership Condition being satisfied suggests strong insider alignment with company performance.
• The board has adopted a clawback policy that complies with NYSEs new clawback rules promulgated under Section 10D of the Exchange Act and the rules promulgated thereunder.

Risks

• If stockholders fail to ratify the selection of Ernst & Young, the audit committee will reconsider its selection, potentially leading to uncertainty.
• The IRS may challenge all or part of the tax basis increase and increased deductions, and a court could sustain such a challenge.
• There may be a material negative effect on our liquidity if, as a result of timing discrepancies or otherwise, the payments under the tax receivable agreement exceed the actual cash tax savings we realize in respect of the tax attributes subject to the tax receivable agreement and/or distributions to us by the Ares Operating Group are not sufficient to permit us to make payments under the tax receivable agreement after it has paid taxes.

Future Outlook

The document outlines the agenda and procedures for the upcoming annual meeting, focusing on the election of directors and ratification of the accounting firm, with no specific forward-looking financial guidance provided.

Management Comments

• Antony P. Ressler, Executive Chairman, expressed appreciation for stockholders' ongoing interest in Ares Management Corporation.
• The Company intends to answer questions that are pertinent to the Company and the official business of the Annual Meeting, subject to time constraints.

Industry Context

This announcement is a standard corporate governance procedure for publicly traded companies, ensuring stockholders have the opportunity to participate in key decisions regarding the company's leadership and financial oversight.

Comparison to Industry Standards

• Holding the annual meeting virtually is becoming increasingly common, aligning with trends seen at companies like Blackstone (BX) and Apollo Global Management (APO) to improve accessibility and reduce costs.
• The proxy voting methods (internet, phone, mail) are standard practices, similar to those used by KKR & Co. Inc. (KKR) and The Carlyle Group (CG).
• The director independence standards align with NYSE requirements, ensuring proper oversight, as seen in the governance structures of comparable firms.

Related Party Transactions

• The document mentions a tax receivable agreement with certain direct and indirect holders of Ares Operating Group Units (the TRA Recipients) that provides for the payment by us to the TRA Recipients of 85% of the amount of cash tax savings (Cash Tax Savings), if any, in U.S. federal, state, local and foreign income tax that we actually realize (or are deemed to realize in the case of an early termination payment by us or a change in control, as discussed below) as a result of increases in tax basis and certain other tax benefits related to our entering into the tax receivable agreement (such payments, Tax Benefit Payments).
• The document mentions that in the normal course of business, our personnel have made use of aircraft owned by Mr. Ressler and by Messrs. Kaplan and Rosenthal together. Payment by us or certain of our affiliates for the business use of these aircraft by Messrs. Ressler, Kaplan and Rosenthal and other of our personnel is generally made at or below market rates, which totaled $96,085 during 2023 for Mr. Ressler, and $170,391 for each of Messrs. Kaplan and Rosenthal during 2023 with respect to their shared aircraft.

Stakeholder Impact

• Stockholders have the opportunity to influence the company's direction through voting on director elections and the selection of the independent accounting firm.
• Employees are indirectly affected by the decisions made at the annual meeting, as they impact the overall governance and financial oversight of the company.
• The company's performance, as influenced by the elected directors and accounting firm, affects fund investors and other stakeholders.

Next Steps

• Stockholders are encouraged to read the proxy materials and vote their shares.
• Attend the virtual Annual Meeting on June 4, 2024.

Key Dates

Keywords

Annual Meeting, Stockholders, Directors, Ernst & Young, Proxy Statement, Ares Management, Voting, Corporate Governance