Cannae Holdings, Inc. Enters into Definitive Agreement to Transition to an Externally Managed Company Structure
The principal terms of the external management structure are as follows:
-
Term: Five year term beginning as of
September 1, 2019 with automatic one-year renewals - Management Fee: Cannae will pay the Manager a quarterly fee of .375% of invested capital excluding holding company cash. The Management Fee will be reduced by any cash compensation paid by Cannae to its named executive officers
- Hurdle Rate and Graduated Incentive Fee Structure: Subject to Cannae’s investments generating an 8% IRR, 15% of realized gain between 1.0x to 2.0x return on a liquidity event and 20% of realized gain over 2.0x return on a liquidity event
- High Water Mark: Upon each liquidity event where an incentive fee is earned, Cannae will deduct for any net unrealized losses looking at the investment portfolio as a whole. There will be a “catch-up” mechanism for any deducted net unrealized losses for subsequent liquidity events if the amount of any net unrealized losses improves
- Ceridian will remain part of the Company’s current Investment Success Incentive Plan. All other Company investments will be included in the external manager incentive fee arrangement
Speaking on behalf of all of the Cannae independent directors,
The foregoing principal terms of the transaction are qualified by the terms and conditions of the definitive agreements relating to the transaction.
About
Cannae (NYSE:CNNE) is a diversified holding company with over
Forward-Looking Statements and Risk Factors
This press release contains forward-looking statements that involve a number of risks and uncertainties. Statements that are not historical facts, including statements regarding our expectations, hopes, intentions or strategies regarding the future are forward-looking statements. Forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. Because such statements are based on expectations as to future events and are not statements of fact, actual results may differ materially from those projected. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. The risks and uncertainties which forward-looking statements are subject to include, but are not limited to: changes in general economic, business and political conditions, including changes in the financial markets; our potential inability to find suitable acquisition candidates, acquisitions in lines of business that will not necessarily be limited to our traditional areas of focus, or difficulties in integrating acquisitions; significant competition that our operating subsidiaries face; compliance with extensive government regulation of our operating subsidiaries; risks associated with our split-off from
This press release should be read in conjunction with the risks detailed in the “Statement Regarding Forward-Looking Information,” “Risk Factors” and other sections of the Company’s Form 10-Q, 10-K and other filings with the
View source version on businesswire.com: https://www.businesswire.com/news/home/20190827005719/en/
Source:
Jamie Lillis, Managing Director,Solebury Trout, 203-428-3223, jlillis@soleburytrout.com