Arthur J. Gallagher & Co. (NYSE: AJG), a global insurance brokerage and risk management services firm, has announced a new equity distribution agreement with Morgan Stanley & Co (NYSE:MS). LLC, enabling the potential sale of up to 3 million shares of its common stock. The agreement, effective today, allows these shares to be sold from time to time through at-the-market offerings.
The new agreement supersedes a previous arrangement under which no shares were sold. It takes advantage of the company's shelf registration statement, which was filed on February 12, 2024. No significant changes have been made to the structure or terms of the at-the-market program.
Under the terms of the equity distribution agreement, shares may be sold at prevailing market prices or through negotiated transactions. Morgan Stanley, acting as the sales agent, will receive a commission not exceeding 1.25% of the gross sales price for any shares sold.
Arthur J. Gallagher has clarified that there is no obligation on their part to sell any shares, nor is Morgan Stanley compelled to buy or sell any shares. The company also noted that there can be no assurance regarding the number of shares that may be sold, nor the prices or dates of any such sales.
The agreement includes an indemnification clause, where Arthur J. Gallagher has agreed to indemnify Morgan Stanley against certain liabilities that may arise under the Securities Act of 1933, as amended.
Investors should note that any shares sold will be issued according to the Registration Statement and supplemented by the prospectus supplement dated today. The details of this arrangement are based on a press release statement.
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