Item 3.02 Unregistered Sales of Equity Securities.
On December 30, 2021, Stagwell Inc. (the "Company') entered into an agreement
(the "Agreement") to purchase the remaining 49% interest in Instrument LLC not
previously owned by the Company from Instrument Holdings Inc. ("Instrument
Holdings") and Instrument Leadership LLC ("Instrument Leadership" and, together
with Instrument Holdings, the "Sellers") for an aggregate purchase price of $160
million. The Agreement replaces the previous agreement between the Company and
the Sellers, which obligated the Company to an uncapped future earn out payment
that management believes would have exceeded the $160 million purchase price.
The purchase price is comprised of $86,078,627 in cash and $73,921,373 in Class
A common stock of the Company ("Stagwell Stock") and payable in three
installments. At closing of the transaction on December 31, 2021, the Company
paid the first installment of $75 million, comprised of $37.5 million in cash
and $37.5 million, or 4,475,653 shares, in Stagwell Stock. The number of shares
was calculated based on the average closing price of the Stagwell Stock for the
30 trading days immediately prior to the date of the Agreement. The second and
third installments of $42.5 million, each comprised of $24,289,313.50 in cash
and $18,210,686.50 in Stagwell Stock, are payable on April 3, 2023 and April 1,
2024, respectively. The number of shares issued in each installment will be
calculated based on the average closing price of the Stagwell Stock for the 30
trading days immediately prior to the payment date. Under the terms of the
Agreement, the aggregate number of shares of Stagwell Stock issued in the
transaction may not exceed 10% of the Company's outstanding Class A common
stock.
The issuance of Stagwell Stock to the Sellers is exempt from registration under
Section 4(a)(2) of the Securities Act, as amended. The Company will receive no
cash proceeds and no commissions will be paid to any person in connection with
the issuance.
Item 7.01 Regulation FD Disclosure.
On January 6, 2022, the Company issued a press release announcing its
acquisition of the remaining 49% interest in Instrument LLC. A copy of the press
release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The foregoing information (including Exhibit 99.1 hereto) is being furnished
under Item 7.01. Such information (including Exhibit 99.1 hereto) shall not be
deemed "filed" for purposes of Section 18 of the Securities Exchange Act of
1934, as amended, nor shall it be deemed incorporated by reference in any filing
under the Securities Act of 1933, as amended, except as shall be expressly set
forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
99.1 Press release dated January 6, 2022.
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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