Brookfield Asset Management : Annual Information Forms (BAM 2023 Annual Information Form vF)

Published: 2025-03-31 08:50:05 ET BAM

TABLE OF CONTENTS

THE MANAGER

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS ANDINFORMATION

CAUTIONARY STATEMENT REGARDING THE USE OF NON-GAAP MEASURESORGANIZATIONAL STRUCTURE

DEVELOPMENT OF THE BUSINESSBUSINESS OF THE MANAGER

CODE OF BUSINESS CONDUCT AND ETHICS BUSINESS ENVIRONMENT AND RISKS SUSTAINABILITY

CORPORATE GOVERNANCE PRACTICES DIRECTOR AND OFFICERS

MARKET FOR SECURITIES DIVIDENDS AND DIVIDEND POLICY DESCRIPTION OF CAPITAL STRUCTURE TRANSFER AGENT AND REGISTRAR PROMOTER

MATERIAL CONTRACT INTERESTS OF EXPERTS

AUDIT COMMITTEE INFORMATION ADDITIONAL INFORMATION

APPENDIX A SUMMARY OF TERMS AND CONDITIONS OF THE MANAGER'S AUTHORIZED SECURITIES

A-1

APPENDIX B CHARTER OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS OF THE MANAGER

B-1

Brookfield Asset Management Ltd.

ANNUAL INFORMATION FORM

THE MANAGER

Brookfield Asset Management Ltd. is a leading global alternative asset manager with $916 billion of assets under management across renewable power and transition, infrastructure, real estate, private equity, and credit. We invest client capital for the long-term with a focus on real assets and essential service businesses that form the backbone of the global economy. We offer a range of alternative investment products to investors around the world - including public and private pension plans, endowments and foundations, sovereign wealth funds, financial institutions, insurance companies and private wealth investors. We draw on our heritage as an owner and operator to invest for value and generate strong returns for our clients, across economic cycles. The Manager's Class A Limited Voting Shares (the "Class A Shares") are co-listed on the New York Stock Exchange ("NYSE") and the Toronto Stock Exchange ("TSX") under the symbol "BAM."

The Manager was incorporated under the Business Corporations Act (British Columbia) on July 4, 2022. The Manager and the Asset Management Company were formed by Brookfield Corporation (formerly Brookfield Asset Management Inc.) (the "Corporation" and together with the Manager, "Brookfield") to facilitate a plan of arrangement (the "Arrangement"). The Arrangement, which closed on December 9, 2022, involved the division of Brookfield Asset Management Inc. into two publicly traded companies: the Manager, a pure-play, leading global alternative asset management business; and the Corporation, a leading global investment firm focused on building long-term wealth for institutions and individuals around the world.

References in this Annual Information Form to the "Manager" refer to Brookfield Asset Management Ltd. Unless context suggests otherwise, references to "we," "us" and "our" refer to the Manager and Brookfield Asset Management ULC (the "Asset Management Company" or the "asset management business"), individually or collectively, where applicable. The Manager's head office is located at Brookfield Place, 181 Bay Street, Suite 100, Toronto, Ontario, M5J 2T3, Canada and its registered office is located at 1500 Royal Centre, 1055 West Georgia Street, P.O. Box 11117, Vancouver, British Columbia V6E 4N7, Canada.

All financial information in this Annual Information Form is expressed in U.S. dollars, unless otherwise noted. All references to € are to Euros. All references to C$ are to Canadian dollars. All information is presented as at December 31, 2023, unless otherwise noted.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

AND INFORMATION

This Annual Information Form contains "forward-looking information" within the meaning of Canadian provincial securities laws and "forward-looking statements" within the meaning of the U.S. Securities Act of 1933, the U.S. Securities

Exchange Act of 1934, "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995 and in any applicable Canadian securities regulations (collectively, "forward-looking statements"). Forward-looking statements include statements that are predictive in nature, depend upon or refer to future results, events or conditions, and include, but are not limited to, statements which reflect management's current estimates, beliefs and assumptions regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies, capital management and outlook of the Manager, the Asset Management Company and its subsidiaries, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and which are in turn based on our experience and perception of historical trends, current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances. The estimates, beliefs and assumptions of the Manager are inherently subject to significant business, economic, competitive and other uncertainties and contingencies regarding future events and as such, are subject to change. Forward-looking statements are typically identified by words such as "expect", "anticipate", "believe", "foresee", "could", "estimate", "goal", "intend", "plan", "seek", "strive", "will", "may" and "should" and similar expressions.

Although the Manager believes that such forward-looking statements are based upon reasonable estimates, beliefs and assumptions, actual results may differ materially from the forward-looking statements. Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: (i) the Manager's material assets consisting solely of its interest in the Asset Management Company; (ii) volatility in the trading price of the Class A Shares; (iii) challenges relating to maintaining our relationship with the Corporation; (iv) the Manager being a newly formed company; (v) deficiencies in our public company financial reporting and disclosures; (vi) our liability for our asset management business; (vii) our organizational and ownership structure may create conflicts of interest; (viii) the difficulty for investors to effect service of process and enforce judgements in the United States, Canada and/or other applicable jurisdictions; (ix) the impact on growth in Fee-Bearing Capital (as defined below) of poor product development or marketing efforts; (x) our ability to maintain our global reputation; (xi) being subject to numerous laws, rules and regulatory requirements; (xii) being subject to anti-bribery and corruption and trade sanctions law and restrictions on foreign direct investment; (xiii) meeting our financial obligations due to our cash flow from our asset management business; (xiv) our ability to complete acquisitions; (xv) foreign currency risk and exchange rate fluctuations;

(xvi) the requirement of temporary investments and backstop commitments to support our asset management business;

(xvii) rising interest rates; (xviii) revenues impacted by a decline in the size or pace of investments made by our managed assets; (xix) our earnings growth can vary, which may affect our dividend and the trading price of the Class A Shares; (xx) exposed risk due to increased amount and type of investment products in our managed assets; (xxi) difficulty in maintaining our culture; (xxii) political instability or changes in government; (xxiii) unfavorable economic conditions or changes in the industries in which we operate; (xxiv) inflationary pressures; (xxv) catastrophic events; (xxvi) ineffective management of environmental and sustainability issues; (xxvii) failure of our information and technology systems; (xxviii) the threat of litigation; (xxix) losses not covered by insurance; (xxx) our inability to collect on amounts owing to us; (xxxi) information barriers that may give rise to conflicts and risks; (xxxii) risks related to our renewable power and transition, infrastructure, private equity and real estate strategies; (xxxiii) changes in Canadian federal income tax law; (xxxiv) reassessments by tax authorities; (xxxv) the Manager being classified as a passive foreign investment company; (xxxvi) changes in tax laws and regulations in jurisdictions in which we operate; (xxxvii) operating restrictions related to the spin-out of the Manager; and (xxxviii) factors detailed from time to time in our documents filed with the securities regulators in Canada and the United States.

We caution that the foregoing list of important factors that may affect future results is not exhaustive and other factors could also adversely affect future results. Readers are urged to consider these risks, as well as other uncertainties, factors and assumptions carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements, which are based only on information available to us as of the date of this Annual Information Form. Except as required by law, the Manager undertakes no obligation to publicly update or revise any forward-looking statements, whether written or oral, that may be as a result of new information, future events or otherwise.

Certain of the information contained herein is based on or derived from information provided by independent third-party sources. While the Manager believes that such information is accurate as of the date it was produced and that the sources from which such information has been obtained are reliable, the Manager makes no representation or warranty, express or implied, with respect to the accuracy, reasonableness or completeness of any of the information or the assumptions on which such information is based, contained herein, including but not limited to, information obtained from third parties.

CAUTIONARY STATEMENT REGARDING THE USE OF NON-GAAP MEASURES

The Manager and the Asset Management Company prepare their financial statements in conformity with the accounting principles generally accepted in the United States of America ("U.S. GAAP"). This Annual Information Form discloses a number of non-GAAP financial and supplemental financial measures which are utilized in monitoring the Manager and our asset management business, including for performance measurement, capital allocation and valuation purposes. The Manager believes that providing these performance measures is helpful to investors in assessing the overall performance of our asset management business. These non-GAAP financial measures should not be considered as the sole measure of the Manager's or our asset management business' performance and should not be considered in isolation from, or as a substitute for, similar financial measures calculated in conformity with U.S. GAAP. Non-GAAP measures include, but are not limited to: (i) distributable earnings ("Distributable Earnings"), (ii) fee revenues ("Fee Revenues") and (iii) fee-related earnings ("Fee-Related Earnings"). These non-GAAP measures are not standardized financial measures and may not be comparable to similar financial measures used by other issuers. Supplemental financial measures include assets under management ("AUM"), fee-bearing capital ("Fee-Bearing Capital") and uncalled fund commitments. The Manager includes the asset management activities of Oaktree (meaning collectively Oaktree Capital II, L.P., Oaktree Capital Management, L.P., Oaktree AIF Investments, L.P., Oaktree Capital Management (Cayman) L.P. and Oaktree Investment Holdings, L.P. and their consolidated subsidiaries), an equity accounted affiliate, in its key financial and operating measures for the asset management business.

For more information on non-GAAP measures and other financial metrics, see "Cautionary Statement Regarding the Use of Non-GAAP Measures", "Key Financial and Operating Measures" and "Glossary of Terms" in our Management's Discussion and Analysis of Financial Results for the year ended December 31, 2023 ("MD&A") dated March 19, 2024, which sections are incorporated by reference in this Annual Information Form. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP, where applicable, are included on pages 67 to 68 of the MD&A, which pages are also incorporated by reference in this Annual Information Form. The MD&A is available on SEDAR+ atwww.sedarplus.ca and on EDGAR at www.sec.gov/ edgar.

ORGANIZATIONAL STRUCTURE

The following diagram shows the simplified corporate structure of the Manager as at December 31, 2023.

The Manager

The Manager is a holding company and its only material asset consists of its approximate 25% interest in the common shares of the Asset Management Company. The Manager was established to become a company through which investors can directly access a leading, pure-play global alternative asset management business. This business was previously carried on by Brookfield Asset Management Inc. and its subsidiaries and is now owned and operated through the Asset Management Company. The Manager intends to pay at least 90% of its Distributable Earnings to shareholders quarterly.

The Asset Management Company

The Asset Management Company is an unlimited liability company formed under the laws of British Columbia with an authorized share capital of an unlimited number of common shares. The Asset Management Company's common shares are held between the Corporation (approximately 75% of the common shares) and the Manager (approximately 25% of the common shares).

DEVELOPMENT OF THE BUSINESS

The following is a summary of recent developments affecting the Manager and our asset management business since January 1, 2021. As the Manager was formed on July 4, 2022, the developments described below under "Asset Management Business" include material developments relating to our asset management business prior to it being contributed to the Manager by the Corporation, as a result of the Arrangement. The material developments relating to corporate activities of the Manager are included from December 9, 2022 onward.

Asset Management Business

2024 Activity - to date

In February 2024, the Manager announced that it raised $10 billion (inclusive of fund commitments and strategic capital from our investor base) in the first closing of Brookfield Global Transition Fund ("BGTF II"), the second vintage of our private fund dedicated to facilitating the global transition to a net-zero carbon economy.

2023 Activity

In 2023, our asset management business benefited from strong fundraising across our flagship and complementary fund offerings, with total capital raised of $83 billion. The successful fundraising across our various flagship series included the final close of our fifth infrastructure flagship fund and our sixth private equity flagship fund, bringing the total capital raised in these strategies to $30 billion and $12 billion, respectively. We also had closes for the latest vintage of our opportunistic credit fund and our inaugural strategic lending partners fund, bringing the total amount raised to $8 billion and $4 billion at year-end, respectively, for these products. We are in the process of completing the first close of the fifth vintage of our flagship real estate fund, which stood at $8 billion at the end of February 2024. These raises were supplemented by significant fundraising across our growing suite of complementary strategies, with the final close of the third vintage of our infrastructure debt fund, bringing the total for the fund to over $6 billion, which makes this fund the world's largest private infrastructure debt fund.

Our Fee-Bearing Capital represents the total capital we manage for which we earn management fees. Fee-Bearing Capital of our asset management business increased by 9% to $457 billion in 2023; of this, 86% is long-dated or perpetual in nature. The high percentage of our Fee-Bearing Capital that is long-dated or perpetual in nature provides resiliency and predictability to our revenues. Inflows to Fee-Bearing Capital of $73 billion were largely driven by flagship fundraising activities, funds raised within credit and other funds, including our insurance solutions business, and capital raised and deployed across other strategies. Fee-Bearing Capital also benefitted from capital raised through issuances of our public vehicles and higher market valuations across our credit, liquid and other perpetual strategies. These increases were partially offset by outflows within our liquid and credit strategies and $16 billion of capital returned to clients.

The increase in Fee-Bearing Capital resulted in Fee Revenues of $4.4 billion and Fee-Related Earnings of $2.2 billion for 2023, an increase of 8% and 6%, respectively, compared to 2022. The increase in Fee-Related Earnings was partially offset by higher cash taxes resulting in Distributable Earnings of $2.2 billion for the year ended December 31, 2023, an increase of 7% compared to 2022. Our asset management business has $47 billion of committed capital across the business groups that will earn approximately $470 million of Fee Revenues once invested.

During the year, our asset management business had gross monetizations of approximately $30 billion and deployed $58 billion across the business groups, including $5.7 billion from renewable power and transition, $19.4 billion from infrastructure, $3.4 billion from private equity, $7.7 billion from real estate and $22.1 billion from credit and other.

As at December 31, 2023, the asset management business had total uncalled private fund commitments of $107 billion.

In 2023, our investment strategies continued to focus on infrastructure, growing out the backbone of the global economy; transition and renewables, benefitting from the global imperative to decarbonize; and direct lending. Some notable examples include:

• In February 2023, we launched Brookfield Infrastructure Income Fund ("BII"), an open-ended, semi-liquid infrastructure product offering private wealth investors access to Brookfield's infrastructure platform. As of December 2023, more than $1.3 billion has been raised since inception of BII from our distribution partners worldwide.

• On September 11, 2023, the Manager and Societe Generale announced a strategic partnership to originate and distribute high-quality private credit investments through a private investment grade debt fund. The initial fund is targeting a total of €10 billion over the next four years and will launch with €2.5 billion of seed funding at inception.

• On December 1, 2023, the Manager and ALTÉRRA, the world's largest private markets climate vehicle launched at the World Climate Action Summit, announced the creation of a multi-billion dollar Catalytic Transition Fund. ALTÉRRA Transformation has committed up to US$1 billion to this fund, alongside ALTÉRRA Acceleration's US$2 billion commitment to BGTF II.

2022 Activity

2In 2022, our asset management business had a record fundraising year, raising $93 billion of capital. Our asset management business continued to see growth across our flagship funds, including the close of our fifth infrastructure flagship fund and our sixth private equity flagship fund, which raised $22 billion and $9 billion in 2022, respectively. In addition, our asset management business had significant fundraising across our growing suite of complementary strategies.

In 2022 we raised $15 billion of strategy capital for our inaugural Global Transition Fund mandate, making Brookfield Global Transition Fund ("BGTF I") the world's largest private fund strategy dedicated to facilitating the global transition to a net-zero carbon economy.

The Fee-Bearing Capital of our asset management business increased by 15% to $418 billion in 2022; of this, 83% is long-dated or perpetual in nature. Inflows to Fee-Bearing Capital of $108 billion were largely driven by flagship fundraising activities, inflows within credit and other funds within our insurance solutions business and capital raised and deployed across other strategies. These increases were partially offset by lower market valuations and outflows within our liquid credit strategies and decreases in the market capitalizations of Brookfield Renewable Partners L.P. ("BEP") and Brookfield Infrastructure Partners L.P. ("BIP"), due to a decline in share prices compared to prior year. During the year, $12.2 billion of distributions were returned to our clients through dividends and asset sales.

The increase in Fee-Bearing Capital drove a 20% increase in Fee Revenues, excluding performance fees, from the prior year to $4.0 billion and Fee-Related Earnings of $2.1 billion for 2022, an increase of 15% compared to 2021. The increase in Fee-Related Earnings was partially offset by higher cash taxes resulting in Distributable Earnings of $2.1 billion for the year ended December 31, 2022, or an increase of 11% compared to 2021. As at December 31, 2022, our asset management business had $41 billion of committed capital across the business groups that will earn approximately $400 million of Fee Revenues once invested.

Our asset management business invested $73.2 billion over the year across the business groups, including $4.3 billion from renewable power and transition, $15.5 billion from infrastructure, $14.6 billion from private equity, $15.0 billion from real estate and $23.8 billion from credit.

As at December 31, 2022, the asset management business had total uncalled private fund commitments of $87.4 billion.

In 2022, investment strategies focused on: infrastructure, growing out the backbone of the global economy; transition and renewables, benefitting from the global imperative to decarbonize; and direct lending.

2021 Activity

In 2021, our asset management business achieved record capital inflows, underpinned by a strong start to our latest round of flagship fundraising and contributions from complementary strategies. By the end of 2021, our asset management business raised $40 billion for this latest round of flagship funds, of which $26 billion was raised in 2021. During the year, it raised $24 billion in aggregate for our fourth flagship real estate fund and our transition fund and held a final close for our $16 billion opportunistic credit fund.

The Fee-Bearing Capital of our asset management business increased by 17% to $364.1 billion at year-end. Inflows to Fee-Bearing Capital of $71 billion were largely driven by the aforementioned flagship fundraising activities, capital deployed across a number of strategies, and inflows from reinsurance agreements. An increase in the capitalization of BIP and Brookfield Business Partners L.P. ("BBU") and market appreciation from credit strategies and other funds contributed a further $12.8 billion. During the year, $11.1 billion of capital was returned to clients of our asset management business through dividends and asset sales.

The increase in Fee-Bearing Capital drove a 19% increase in Fee Revenues, excluding performance fees, from the prior year to $3.4 billion. Our asset management business earned $157 million in performance fees from BBU as its volume weighted average price exceeded the high watermark during both the second and fourth quarter of the year. Fee-Related Earnings of $1.8 billion for 2021, or an increase of 33%, compared to 2020. The increase in Fee-Related Earnings was partially offset by higher cash taxes resulting in Distributable Earnings of $1.9 billion for the year ended December 31, 2021, or an increase of 26% compared to 2020. In addition, at year-end our asset management business also had approximately $40 billion of committed capital across the business groups that will earn approximately $400 million of Fee Revenues once invested.

Our asset management business invested $61.2 billion over the year across the business groups, including $1.7 billion from renewable power and transition, $7.8 billion from infrastructure, $7.7 billion from private equity, $23.4 billion from real estate and $20.6 billion from credit.

As at December 31, 2021, our asset management business had total uncalled private fund commitments of $77.1 billion.

In 2021, areas of focus continued to be investing in the transition of the economy to net-zero, growing the insurance solutions business, expanding technology investments and enhancing secondaries product offerings. Our asset management business also focused on completing our latest round of flagship fundraising, where a $100 billion raise was targeted. Lastly, our asset management business established Brookfield Oaktree Wealth Solutions, a dedicated private wealth team of over 70 personnel with a focus on enhancing our distribution capabilities within this channel.

Corporate

2024 Activity - to date

On January 9, 2024, the Manager announced the TSX approval of a normal course issuer bid ("NCIB") to purchase up to 34.6 million Class A Shares, representing at the time approximately 10% of the public float of Class A Shares, through open market purchases on the NYSE and TSX. Under the NCIB, which commenced on January 11, 2024 and is set to expire on January 10, 2025, the Manager has not purchased any Class A Shares, as at March 4, 2024.

On February 7, 2024, the Manager declared a quarterly dividend of $0.38 per share, representing a 19% increase relative to the prior year, payable on March 28, 2024, to shareholders of record as of the close of business on February 29, 2024.

On March 19, 2024, the Manager announced the appointment of Hadley Peer Marshall as Chief Financial Officer of the Manager effective May 31, 2024. She succeeds Bahir Manios, who will stay on with the Manager until the end of May 2024 to ensure a smooth transition. Ms. Peer Marshall joined Brookfield in 2015 in the Infrastructure Group and she is currently the co-head of Brookfield's infrastructure debt and structured solutions.

2023 Activity

On January 9, 2023, the Manager announced the TSX approval of a NCIB to purchase up to 31.8 million Class A Shares, representing at the time approximately 10% of the public float of Class A Shares, through open market purchases on the NYSE and TSX. Under the bid, which commenced on January 11, 2023 and expired on January 10, 2024, the Manager purchased 7,250,707 Class A Shares at an average price of $33.40.

On July 5, 2023, Brookfield Reinsurance ("BNRE") and American Equity Investment Life Holding Company ("AEL") entered into a merger agreement whereby BNRE will acquire all of the outstanding common stock of AEL it does not already own. As part of the agreement, each AEL shareholder will receive $55.00 per AEL share, consisting of $38.85 in cash and 0.49707 of a Class A Share, subject to adjustment in certain circumstances. BNRE, the Corporation and the Manager entered into a share purchase agreement in connection with the transaction pursuant to which the Corporation will facilitate the delivery of Class A Shares offered as consideration under the merger agreement. This will not result in dilution to shareholders of the Manager since, pursuant to the share purchase agreement, the Corporation will sell to the Manager an equivalent portion of the Asset Management Company shares held by the Corporation in consideration for the Class A Shares. Subject to this occurring, the Manager's public float will increase by approximately 10%, the Manager's interest in the Asset Management Company will increase from approximately 25% to approximately 27%, and the Corporation's interest in the Manager will decrease from approximately 75% to approximately 73%. The Manager will not have any ownership interest in AEL following the completion of the transaction.

2022 Activity

On July 4, 2022, the Manager and the Asset Management Company were formed by the Corporation for the purpose of effecting the Arrangement.

On December 9, 2022, the Corporation completed the public listing and distribution of a 25% interest in the Corporation's asset management business, through the Manager, pursuant to the Arrangement. As a result of the Arrangement, holders of the Corporation's Class A Limited Voting Shares (the "Class A Shares of the Corporation") received 0.25 of a Class A Share for each Class A Share of the Corporation held.

BUSINESS OF THE MANAGER

Our Business

We are one of the world's leading global alternative asset managers, with $916 billion of AUM as of December 31, 2023, across renewable power and transition, infrastructure, real estate, private equity, and credit. We invest client capital for the long-term with a focus on real assets and essential service businesses that form the backbone of the global economy. We draw on our heritage as an owner and operator to invest for value and generate strong returns for our clients across economic cycles.

To do this, we leverage our team of over 2,400 investment and asset management professionals, our global reach, deep operating expertise, and access to large-scale capital to identify attractive investment opportunities and invest on a proprietary basis. Our investment approach and strong track record have been the foundation and driver of our growth.

Disclaimer

Brookfield Asset Management Ltd. published this content on March 31, 2025, and is solely responsible for the information contained herein. Distributed via , unedited and unaltered, on March 31, 2025 at 12:49 UTC.