| > | any other direct or indirect transfer of all or any portion of PJT Partners’ interest in PJT Partners Holdings, other than certain permitted transfers to affiliated entities.TABLE OF CONTENTS Such consent of limited partners to a Termination Transaction is not required if either: (1) in connection with the Termination Transaction:
(i) each holder of Partnership Units is entitled to receive the “transaction consideration,” defined as the fair market value, at the time of the Termination Transaction, of an amount of cash, securities or other property equal to the product of:
the number of shares of our Class A common stock into which a Partnership Unit is then exchangeable; and
the greatest amount of cash, securities or other property paid per share to the holder of any shares of our Class A common stock in consideration of such shares in connection with the Termination Transaction;
(1)
| in connection with the Termination Transaction: |
(i)
| each holder of Partnership Units is entitled to receive the “transaction consideration,” defined as the fair market value, at the time of the Termination Transaction, of an amount of cash, securities or other property equal to the product of: |
| > | the number of shares of our Class A common stock into which a Partnership Unit is then exchangeable; and |
| > | the greatest amount of cash, securities or other property paid per share to the holder of any shares of our Class A common stock in consideration of such shares in connection with the Termination Transaction; |
provided that, if, in connection with the Termination Transaction, a purchase, tender or exchange offer is made to and accepted by the holders of a majority of the outstanding shares of our Class A common stock, the transaction consideration will refer to the fair market value of the greatest amount of cash, securities or other property which such holder would have received had it exercised its exchange right and received shares of our Class A common stock in exchange for its Partnership Units immediately prior to the expiration of such purchase, tender or exchange offer and had accepted such purchase, tender or exchange offer; and (ii) PJT Partners Holdings receives an opinion from nationally recognized tax counsel to the effect that such Termination Transaction will be tax-free to each holder of Partnership Units (other than PJT Partners and entities controlled by PJT Partners) for U.S. federal income tax purposes (except to the extent of cash received);
or
(2) all of the following conditions are met:
substantially all of the assets directly or indirectly owned by PJT Partners Holdings prior to the announcement of the Termination Transaction are, immediately after the Termination Transaction, owned directly or indirectly by (x) PJT Partners Holdings or (y) another limited partnership or limited liability company organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof, which is the survivor of a merger, consolidation or combination of assets with PJT Partners Holdings, which we refer to as the “surviving partnership,”
the surviving partnership is classified as a partnership for U.S. federal income tax purposes;
each holder of Partnership Units (other than PJT Partners and entities controlled by PJT Partners) that held Partnership Units immediately prior to the closing of such Termination Transaction owns a percentage interest of the surviving partnership based on the relative fair market value of the net assets of PJT Partners Holdings and the other net assets of the surviving partnership immediately prior to the consummation of such transaction; and
the rights of such limited partners with respect to the surviving partnership are at least as favorable as those of limited partners prior to the consummation of such transaction and as those applicable to any other limited partners or non-managing members of the surviving partnership, and such rights include:
(a) if PJT Partners or its successor has a single class of publicly traded common equity securities, the right, to the same extent provided to holders of Partnership Units
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(ii)
| PJT Partners Holdings receives an opinion from nationally recognized tax counsel to the effect that such Termination Transaction will be tax-free to each holder of Partnership Units (other than PJT Partners and entities controlled by PJT Partners) for U.S. federal income tax purposes (except to the extent of cash received); |
or (2)
| all of the following conditions are met: |
| > | substantially all of the assets directly or indirectly owned by PJT Partners Holdings prior to the announcement of the Termination Transaction are, immediately after the Termination Transaction, owned directly or indirectly by (x) PJT Partners Holdings or (y) another limited partnership or limited liability company organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof, which is the survivor of a merger, consolidation or combination of assets with PJT Partners Holdings, which we refer to as the “surviving partnership,” |
| > | the surviving partnership is classified as a partnership for U.S. federal income tax purposes; |
| > | each holder of Partnership Units (other than PJT Partners and entities controlled by PJT Partners) that held Partnership Units immediately prior to the closing of such Termination Transaction owns a percentage interest of the surviving partnership based on the relative fair market value of the net assets of PJT Partners Holdings and the other net assets of the surviving partnership immediately prior to the consummation of such transaction; and |
| > | the rights of such limited partners with respect to the surviving partnership are at least as favorable as those of limited partners prior to the consummation of such transaction and as those applicable to any other limited partners or non-managing members of the surviving partnership, and such rights include: |
(a)
| if PJT Partners or its successor has a single class of publicly traded common equity securities, the right, to the same extent provided to holders of Partnership Units pursuant to the Exchange Agreement, to exchange their interests in the surviving partnership for either: |
(1)
| a number of such publicly traded common equity securities with a fair market value, as of the date of consummation of such Termination Transaction, equal to the transaction consideration referred to above, subject to customary conversion rate adjustments for splits, unit distributions and reclassifications, which we refer to as the “successor shares amount;” or |
(2)
| cash in an amount equal to the fair market value of the successor shares amount at the time of such exchange; or |
TABLE OF CONTENTS pursuant to the exchange agreement, to exchange their interests in the surviving partnership for either: (1) a number of such publicly traded common equity securities with a fair market value, as of the date of consummation of such Termination Transaction, equal to the transaction consideration referred to above, subject to customary conversion rate adjustments for splits, unit distributions and reclassifications, which we refer to as the “successor shares amount;” or (2) cash in an amount equal to the fair market value of the successor shares amount at the time of such exchange; or
(b) if PJT Partners or its successor does not have a single class of publicly traded common equity securities, the right to exchange their interests in the surviving partnership on a quarterly basis for cash in an amount equal to the fair market value of such interest at the time of exchange, as determined at least once every calendar quarter by an independent appraisal firm of recognized national standing retained by the surviving partnership.
(b)
| if PJT Partners or its successor does not have a single class of publicly traded common equity securities, the right to exchange their interests in the surviving partnership on a quarterly basis for cash in an amount equal to the fair market value of such interest at the time of exchange, as determined at least once every calendar quarter by an independent appraisal firm of recognized national standing retained by the surviving partnership. |
For the purpose of determining compliance with the condition set forth in the third bullet above, the relative fair market values shall be reasonably determined by PJT Partners as of the time of such transaction and, to the extent applicable, shall be no less favorable to the holders of Partnership Units than the relative values reflected in the terms of such transaction. The limited partnership agreement of PJT Partners HoldingsLimited Partnership Agreement also provides the limited partners with certain consent rights in the event a majority of ourthe Board ceases to be Continuing Directors (as defined below) (such event, a “Board Change of Control”). “Continuing Directors” means as of any date of determination, any member of ourthe Board who: (1) was a member immediately following the consummation of the merger and spin-off transactions in 2015; or (2) was nominated for election or elected or appointed with the approval of a majority of the Continuing Directors who were members at the time of such nomination, election or appointment, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board. From and after the occurrence of a Board Change of Control, the following actions will require the approval of limited partners representing a majority in interest of all limited partners (excluding any limited partners controlled by PJT Partners), including each Significant Limited Partner: any removal or appointment of any “officer,” as defined in Rule 16a-1(f) of the Exchange Act, including the CEO, of PJT Partners;
the creation, authorization or issuance of any new class or series of equity interest in PJT Partners Holdings;
the incurrence of any indebtedness (other than intercompany indebtedness) by PJT Partners Holdings or any of its subsidiaries or controlled affiliates that would, or is intended to, result in a material increase in the amount of consolidated indebtedness of PJT Partners Holdings as compared to immediately prior to such Board Change of Control;
any extraordinary distribution of PJT Partners Holdings;
any change in PJT Partners Holdings’ distribution policy that would, or that is intended to, result in a material increase in the amount or frequency of distributions as compared to levels prior to the Board Change of Control;
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(1)
| was a member immediately following the consummation of the merger and spin-off transactions in 2015; or |
(2)
| was nominated for election or elected or appointed with the approval of a majority of the Continuing Directors who were members at the time of such nomination, election or appointment, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board. From and after the occurrence of a Board Change of Control, the following actions will require the approval of limited partners representing a majority in interest of all limited partners (excluding any limited partners controlled by PJT Partners), including each Significant Limited Partner: |
| > | any removal or appointment of any “officer,” as defined in Rule 16a-1(f) of the Exchange Act, including the CEO, of PJT Partners; |
| > | the creation, authorization or issuance of any new class or series of equity interest in PJT Partners Holdings; |
| > | the incurrence of any indebtedness (other than intercompany indebtedness) by PJT Partners Holdings or any of its subsidiaries or controlled affiliates that would, or is intended to, result in a material increase in the amount of consolidated indebtedness of PJT Partners Holdings as compared to immediately prior to such Board Change of Control; |
| > | any extraordinary distribution of PJT Partners Holdings; |
| > | any change in PJT Partners Holdings’ distribution policy that would, or that is intended to, result in a material increase in the amount or frequency of distributions as compared to levels prior to the Board Change of Control; |
| > | any change in PJT Partners Holdings’ policy regarding Partnership Unit repurchases including without limitation from PJT Partners, that would, or that is intended to, result in a material increase in the amount or frequency of Partnership Unit repurchases as compared to levels prior to the Board Change of Control; |
| > | any merger, consolidation or sale of all or any significant portion of the assets of PJT Partners Holdings; |
| > | any voluntary liquidation, dissolution or winding up of PJT Partners Holdings or the commencement of a proceeding for bankruptcy, insolvency, receivership or similar action with respect to the PJT Partners Holdings or any of its subsidiaries or controlled affiliates; |
| > | calling any meeting of the limited partners of PJT Partners Holdings or submitting any matter for the vote or consent of the limited partners of PJT Partners Holdings; |
| > | any settlement or compromise of any litigation directly against or otherwise relating to indemnification of the PJT Partners or its directors or officers or their affiliates or representatives or any litigation regarding tax matters; or |
| > | any amendment to the Limited Partnership Agreement. |
TABLE OF CONTENTS any change in PJT Partners Holdings’ policy regarding Partnership Unit repurchases including without limitation from PJT Partners, that would, or that is intended to, result in a material increase in the amount or frequency of Partnership Unit repurchases as compared to levels prior to the Board Change of Control;
any merger, consolidation or sale of all or any significant portion of the assets of PJT Partners Holdings;
any voluntary liquidation, dissolution or winding up of PJT Partners Holdings or the commencement of a proceeding for bankruptcy, insolvency, receivership or similar action with respect to the PJT Partners Holdings or any of its subsidiaries or controlled affiliates;
calling any meeting of the limited partners of PJT Partners Holdings or submitting any matter for the vote or consent of the limited partners of PJT Partners Holdings;
any settlement or compromise of any litigation directly against or otherwise relating to indemnification of the PJT Partners or its directors or officers or their affiliates or representatives or any litigation regarding tax matters; or
any amendment to the limited partnership agreement of PJT Partners Holdings.
In addition, the limited partnership agreement of PJT Partners HoldingsLimited Partnership Agreement enables PJT Partners Holdings to issue LTIP Units pursuant to the Omnibus Incentive Plan. LTIP Units are a class of partnership interest that are intended to qualify as “profits interests” in PJT Partners Holdings for U.S. federal income tax purposes that, subject to certain conditions, shall automatically be converted into Partnership Units. LTIP Units initially do not have full parity, on a per unit basis, with Partnership Units with respect to liquidating distributions. Upon the occurrence of specified events, LTIP Units can over time achieve full parity with Partnership Units, at which time LTIP Units shall automatically be converted into Partnership Units on a one-for-one basis. The limited partnership agreement of PJT Partners HoldingsLimited Partnership Agreement provides that upon a sale of all or substantially all of the assets of PJT Partners Holdings, holders of LTIP Units will receive a priority allocation of income. The priority allocation will generally be made to the holders of LTIP Units until the capital account of each LTIP Unit equals the capital account of a Partnership Unit. In addition, the capital accounts of the LTIP Units will be increased in priority to the Partnership Units when PJT Partners Holdings revalues its assets. After the capital account balances of the LTIP Units have been increased such that each LTIP Unit has a capital account balance equal to that of a Partnership Unit, allocations of net income and net loss are made on a per-unit basis. The effect of these allocation provisions is to enable LTIP Units, which are issued with lower capital account balances than the Partnership Units, to participate in liquidating distributions of PJT Partners Holdings on the same basis as Partnership Units, assuming there is sufficient profit to allocate to the LTIP Units. LTIP Units may be issued to PJT Partners personnel and third parties from time to time in one or more series having the rights, powers, privileges, restrictions, qualifications and limitations set forth in the relevant award agreement or other documentation pursuant to which the LTIP Units of such series are granted or issued, including with respect to participation in distributions. Subject to the terms of any award or other applicable agreement, unvested partnership interests will be forfeited if the holder ceases to provide services to PJT Partners Holdings. Certain forfeited partnership interests will be subject to reallocation by our Compensation Committee in consultation with Mr. Taubman (or subject to other reallocations in accordance with the Limited Partnership Agreement). Sublease with Dynasty Equity Partners Management, LLC PJT Partners Holdings has entered into a sublease agreement, commencing October 1, 2022 (the “Sublease”) with Dynasty Equity Partners Management, LLC, a Delaware limited partnership agreement)liability company (“Dynasty”). K. Don Cornwell, a member of the Board, is the Chief Executive Officer and co-founder of Dynasty. Pursuant to the Sublease, Dynasty subleases certain office space from PJT Partners Holdings through October 1, 2024, subject to possible renewal, at annual rent of approximately $800,000. The rent, terms and conditions of the Sublease were consistent with those of similar subleases in the market as of the time the Sublease was entered. 65
Executive Compensation
71
|
TABLE OF CONTENTS PROPOSAL 2—NON-BINDING ADVISORY VOTE ON EXECUTIVE COMPENSATIONIn accordance with the requirements of Section 14A of the Exchange Act and the related rules of the SEC, we are including in these proxy materials a separate resolution subject to shareholder vote to approve, in a non-binding advisory vote, the compensation of our Named Executive Officers as disclosed above. The text of the resolution in respect of Proposal 2 is as follows:
“RESOLVED, that the compensation paid to the company’s Named Executive Officers as disclosed in this Proxy Statement pursuant to the rules of the SEC, including the Compensation Discussion and Analysis, compensation tables, and any related narrative discussion, is hereby APPROVED.”
In considering their vote, shareholders may wish to review with care the information on our compensation policies and decisions regarding the Named Executive Officers presented in the Compensation Discussion and Analysis set forth above.
In particular, shareholders should note that the Compensation Committee bases its executive compensation decisions on the following:
annual incentive compensation that places a strong emphasis on financial performance, with the flexibility to assess operational and individual performance;
an appropriate link between compensation and the creation of shareholder value through equity awards; and
long-term incentive awards that do not promote excessive risk taking.
While the results of the vote are non-binding and advisory in nature, the Board intends to carefully consider the results of the vote.
At the company’s 2018 Annual Meeting of Shareholders, our shareholders indicated their preference to hold the non-binding advisory vote to approve the compensation of our Named Executive Officers each year. Accordingly, we currently intend to hold such votes annually. The next vote to approve the compensation of our Named Executive Officers is expected to be held at our 2023 Annual Meeting of Shareholders. While the Board intends to consider carefully the results of this vote, the final vote is advisory in nature and is not binding on the company or the Board.
The Board recommends a vote “FOR” the approval of the compensation of our Named Executive Officers.
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| | | |
TABLE OF CONTENTS
| Proposal 4: Ratification of Independent Registered Public Accounting Firm | | The Audit Committee of the Board has selected Deloitte & Touche LLP as our independent registered public accounting firm to perform the audit of our consolidated financial statements for 2024. |
| Board Recommendation | | The Board recommends that you vote “FOR” the ratification of the selection of Deloitte & Touche LLP as our independent registered public accounting firm. |
RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Our Audit Committee has selected Deloitte as our independent registered public accounting firm to perform the audit of our consolidated financial statements for 2022.2024. Representatives of Deloitte are expected to be present at our Annual Meeting, will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions. The appointment of Deloitte as our independent registered public accounting firm is being submitted to our shareholders for ratification at the Annual Meeting. OurThe Board recommends that the shareholders vote “FOR” the ratification of the selection of Deloitte as our independent registered public accounting firm. The submission of the appointment of Deloitte is required neither by law nor by our Amended and Restated Bylaws. OurBy-Laws. The Board is nevertheless submitting it to our shareholders to ascertain their views. If our shareholders do not ratify the appointment, the selection of another independent registered public accounting firm may be considered by the Audit Committee. Even if the selection is ratified, the Audit Committee in its discretion may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the company and our shareholders. The following table sets forth aggregate fees billed to us by Deloitte for 20202022 and 2021:2023: | | Audit Fees(1) | | | $2,048,251 | | | $1,837,828 | | | | Audit-Related Fees | | | — | | | — | | | | Tax Fees(2) | | | 915,830 | | | 1,012,167 | | | | All Other Fees | | | — | | | — | | | | Total | | | $2,964,081 | | | $2,849,995 | |
| | | Fiscal Year Ended
December 31, | | | | 2022 | | | 2023 | Audit Fees(1) | | | $2,400,608 | | | $2,184,266 | | Audit-Related Fees | | | — | | | — | Tax Fees(2) | | | $1,184,856 | | | $1,225,310 | All Other Fees(3) | | | — | | | 10,706 | | Total | | | $3,585,464 | | | $3,420,282 |
(1)
| Audit Fees includerepresent fees for services rendered for the audit and quarterly reviews of our consolidated financial statements filed with the SEC on Forms 10-K and 10-Q, respectively, as well as statutory and financial audits for our United States and foreign consolidated subsidiaries. |
(2)
| Tax fees represent fees for services performed by the independent registered public accounting firm’s tax personnel, except those services specifically related to the audit and review of the financial statements, and consisted of tax consulting and compliance professional services, including to our United States and foreign consolidated subsidiaries. |
(3)
| All Other Fees represent fees for services performed by the independent registered public accounting firm to provide a monitoring report for a non-U.S. subsidiary. |
TABLE OF CONTENTS Pre-Approval Policies and Procedures Our Audit Committee does not permit the engagement of our auditors without pre-approval by the Audit Committee. The engagement of Deloitte for permitted non-audit accounting and tax services is limited to circumstances where these services are considered integral to the audit services that Deloitte provides or where there is another compelling rationale for using Deloitte. All audit services for which Deloitte was engaged during 20212023 were pre-approved by the Audit Committee in compliance with applicable SEC requirements. TABLE OF CONTENTS REPORT OF THE AUDIT COMMITTEE The duties and responsibilities of the Audit Committee are set forth in our Audit Committee Charter, which can be found on our website, www.pjtpartners.com, under the “Investor Relations/Corporate Governance/Governance Documents” section. The Audit Committee has: selected the independent registered public accounting firm to audit our books and records;
reviewed and discussed our audited financial statements for 2021 with management and with Deloitte, our independent registered public accounting firm, and has held, as appropriate, executive sessions with Deloitte without the presence of management;
discussed with our independent registered public accounting firm the matters required by the applicable standards of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC; and
received from Deloitte the written disclosures and the letter required by the applicable requirements of the PCAOB regarding the independent accountant’s communications with the Audit Committee concerning independence and has discussed with Deloitte its independence.
| > | selected the independent registered public accounting firm to audit our books and records; |
| > | reviewed and discussed our audited financial statements for 2023 with management and with Deloitte, our independent registered public accounting firm, and has held, as appropriate, executive sessions with Deloitte without the presence of management; |
| > | discussed with our independent registered public accounting firm the matters required by the applicable standards of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC; and |
| > | received from Deloitte the written disclosures and the letter required by the applicable requirements of the PCAOB regarding the independent accountant’s communications with the Audit Committee concerning independence and has discussed with Deloitte its independence. |
In performing all of these functions, the Audit Committee acts in an oversight capacity. The Audit Committee reviews our quarterly and annual reports on Form 10-Q and Form 10-K, respectively, prior to filing with the SEC. In its oversight role, the Audit Committee relies on the work and assurances of: our management, which has the primary responsibility for establishing and maintaining adequate internal control over financial reporting and for preparing the financial statements, and other reports; and
the independent registered public accounting firm, which is responsible for auditing our financial statements and expressing an opinion as to whether those audited financial statements fairly present, in all material respects, our financial position, results of operations, and cash flows in conformity with generally accepted accounting principles in the United States of America.
| > | our management, which has the primary responsibility for establishing and maintaining adequate internal control over financial reporting and for preparing the financial statements, and other reports; and |
| > | the independent registered public accounting firm, which is responsible for auditing our financial statements and expressing an opinion as to whether those audited financial statements fairly present, in all material respects, our financial position, results of operations, and cash flows in conformity with generally accepted accounting principles in the United States of America. |
Based on these reviews and discussions and the reports of the independent registered public accounting firm, the Audit Committee recommended to the Board that the audited financial statements be included in our Form 10-K for the fiscal year ended December 31, 20212023 filed with the SEC. Submitted by our Audit Committee:
Kenneth C. Whitney, Chair
James Costos
Grace R. Skaugen The information in this report is not “soliciting material,” is not deemed filed with the SEC and is not to be incorporated by reference in any of our filings under the Securities Act or the Exchange Act whether made before or after the date hereof and irrespective of any general incorporation language in any such filings.filings. TABLE OF CONTENTS SHAREHOLDER PROPOSALS AND NOMINATIONS FOR 2023OUR 2025 ANNUAL MEETING In order for a shareholder proposal to be included in our Proxy Statement to be issued in connection with our 2023 Annual Meeting, that proposal must be received by our Corporate Secretary no later than November 17, 2022 (which is 120 calendar days before the anniversary of the date this Proxy Statement was first mailed or made available to shareholders).
In addition, eligibleEligible shareholders who wish to submit director nominations or bring any business at the 20232025 Annual Meeting, including shareholder proposals to be included in our Proxy Statement, must comply with the advance notice procedures set forth in our Amended and Restated Bylaws. By-Laws.
In order for sucha shareholder proposal to be included in our Proxy Statement to be issued in connection with our 2025 Annual Meeting, that proposal must be received by our Corporate Secretary no later than December 30, 2024 (which is 120 calendar days before the anniversary of the date this Proxy Statement was first mailed or made available to shareholders). In order for director nominations and other business to be deemed timely, notice of such director nominations and other business must be received by our Corporate Secretary (A) no earlier than December 29, 2022February 20, 2025 and no later than January 28, 2023March 22, 2025 or (B) in the event that our 20232025 Annual Meeting of Shareholders is held prior to March 29, 2023May 21, 2025 or after July 7, 2023,August 29, 2025, notice by the shareholder must be so received no earlier than the 120th day prior to such Annual Meeting and no later than the close of business on the later of the 90th day prior to such Annual Meeting or the 10th day following the day on which public announcement of the date of the Annual Meeting is first made, and, in each case, must satisfy the notification, timeliness, consent and information requirements set forth in our Amended and Restated Bylaws.By-Laws. In addition to satisfying the foregoing requirements under our Amended and Restated Bylaws,By-Laws, to comply with the universal proxy rules, (once effective), stockholdersshareholders who intend to solicit proxies in support of director nominees other than the company’s nominees must provide notice that sets forth any additional information required by Rule 14a-19 under the Exchange Act no later than February 27, 2023.April 21, 2025. TABLE OF CONTENTS General Information about Our 2024 Annual Meeting GENERAL INFORMATION ABOUT OUR 2024 ANNUAL MEETING PJT Partners Inc. is making this Proxy Statement available to its shareholders in connection with the solicitation of proxies by the Board for our 2024 Annual Meeting of Shareholders to be held on June 20, 2024 at 10:00 a.m., Eastern Daylight Time via live audio webcast at www.virtualshareholdermeeting.com/PJT2024, and any adjournment or postponement thereof. You are receiving this Proxy Statement because you owned shares of the company’s Class A or Class B common stock at the close of business on April 22, 2024, the Record Date for the Annual Meeting, which entitles you to vote at the Annual Meeting. This Proxy Statement describes the matters on which we would like you to vote and provides information on those matters so that you can make an informed decision. Participation in Our Annual Meeting The Annual Meeting will be a virtual meeting of shareholders held via an audio webcast. The virtual meeting will provide the same rights and advantages of a physical meeting. Shareholders will be able to present questions online before the meeting or during a portion of the meeting, providing our shareholders with the opportunity for meaningful engagement with the company. To participate in the meeting, you must have your 16-Digit Control Number that is shown on your Notice of Availability of Proxy Materials (the “Notice of Availability”) or on your proxy card if you elected to receive proxy materials by mail. You may access the Annual Meeting by visiting www.virtualshareholdermeeting.com/PJT2024. You will be able to submit questions either before the meeting, from June 3 to June 14, 2024, or during a portion of the meeting. If you wish to submit a question before the meeting, you may log into www.proxyvote.com using your 16-Digit Control Number and follow the instructions to submit a question. Alternatively, if you wish to submit a question during the meeting, log into the virtual meeting platform at www.virtualshareholdermeeting.com/PJT2024 using the 16-Digit Control Number and follow the instructions to submit a question. Technicians will be ready to assist you with any technical difficulties you may have accessing the virtual meeting. If you encounter any difficulties accessing the virtual meeting during check-in or during the virtual meeting, please call the technical support number posted on the virtual meeting platform log-in page. You may also obtain information regarding access to the Annual Meeting by contacting our investor relations representative at 212-364-7810 or via email at investorrelations@pjtpartners.com. This Proxy Statement contains information about the items shareholders will vote on at the Annual Meeting. The virtual meeting format for the Annual Meeting will enable full and equal participation by all of our shareholders from any place in the world at little to no cost. We designed the format of the virtual meeting to ensure that shareholders who attend our Annual Meeting will be afforded the same rights and opportunities to participate as they would at an in-person meeting. We will take the following steps to ensure such an experience by: (1)
| providing shareholders with the ability to submit appropriate questions either in advance of the meeting or during the meeting real-time via the meeting website, limiting questions to one per shareholder unless time otherwise permits; and |
(2)
| answering as many questions submitted in accordance with the meeting rules of conduct as possible in the time allotted for the meeting. |
Our Proxy Materials include: | Notice of our 2024 Annual Meeting of Shareholders (which is attached to this Proxy Statement); and | |
our 2023 Annual Report to Shareholders. TABLE OF CONTENTS If you received printed versions of these materials by mail (rather than through electronic delivery), these materials also include a Proxy Card or voting instruction form. If you received or accessed these materials through the Internet, your Proxy Card or voting instruction form are available to be filled out and executed electronically. Mailing of Proxy Materials The Proxy Materials will be mailed or made available to our shareholders on or about April 29, 2024. On or about April 29, 2024, we will mail to most of our shareholders a Notice of Availability containing instructions on how to access our Proxy Statement. Below are answers to common questions shareholders may have about the Proxy Materials and the Annual Meeting. Notice of Internet Availability of Proxy Materials Under rules adopted by the SEC, we are furnishing Proxy Materials to most of our shareholders on the Internet, rather than mailing printed copies. By doing so, we save costs and reduce our impact on the environment. If you received a Notice of Availability by mail, you will not receive printed copies of the Proxy Materials unless you request them. Instead, the Notice of Availability will instruct you how to access and review the Proxy Materials on the Internet. If you would like printed copies of the Proxy Materials, please follow the instructions on the Notice of Availability. Shares to be Voted at the Annual Meeting; Our Voting Structure Does Not Contain Super-Voting Powers Holders of Class A common stock will have one vote for every share of Class A common stock that such holder owned at the close of business on the Record Date. Due to our “Up-C” corporate structure, certain holders of the equity in our company maintain their ownership through PJT Partners Holdings partnership units and LTIP Units (collectively, the “Partnership Units”). In order to ensure that these Partnership Unit holders are not disenfranchised and, therefore, are entitled to vote their economic interest in the company, these holders were granted an accompanying share of Class B common stock. This share of Class B common stock entitles the holder to a number of votes commensurate with such holder’s vested and unvested Partnership Units and does not provide any voting power in excess of the holder’s economic interest in the company. Rather, it merely provides a vehicle for a Partnership Unit holder to vote such holder’s economic interest in the company and does not give disproportionate or super-voting rights to holders of Partnership Units and Class B common stock. Whereas some companies with a dual-class stock voting structure give certain shareholders super-voting stock that may have 10 or more votes per share, we do not. As an example, if a holder of a share of Class B common stock owns 100 Partnership Units, that share of Class B common stock would simply provide such holder with 100 votes on all matters presented to our shareholders. In an effort to preserve the tax-free nature of our spin-off in 2015 from Blackstone Inc. (“Blackstone”), our Restated Certificate of Incorporation provided that holders of Class B common stock were limited to only one vote per share of Class B common stock solely with respect to the election or removal of directors. Thus, applying the above example, that same holder of Class B common stock (representing 100 Partnership Units) would be entitled to 100 votes on all matters presented to our shareholders but only one vote with respect to director elections or removals. With the passage of time since the spin-off, this restriction on the voting rights of holders of Class B common stock is no longer operative, an eventuality that was envisaged in our Restated Certificate of Incorporation. Pursuant to our Restated Certificate of Incorporation, upon the request of a holder of Class B common stock and approval by the Board, such holder’s Class B common stock would be equalized to provide the same number of votes for the election and removal of directors as it does for all other matters. Accordingly, certain holders of vested and unvested Partnership Units have requested, and the Board has approved, that the shares of Class B common stock held by them provide them with the same number of votes for the election and removal of directors as they do for all other matters. Holders of shares of our Class B common stock will vote together with holders of our Class A common stock as a single class on all matters on which such shareholders are entitled to vote generally, except as otherwise required by law. TABLE OF CONTENTS As noted above in the section titled, “SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT,” in connection with the merger and spin-off transactions, the Blackstone Senior Management provided an irrevocable proxy to Mr. Taubman, empowering Mr. Taubman to vote or cause to be voted all of the Subject Shares at every shareholders meeting of the company on all matters in respect to which the Subject Shares are entitled to vote, and on every action or approval by written consent of the shareholders of the company in respect of which the Subject Shares are entitled to consent or dissent, for so long as Mr. Taubman is the CEO of PJT Partners. As of April 22, 2024, the Record Date for our Annual Meeting, our share count for voting purposes set forth above was as follows: | | | Proposal 1:
Elect the
Class III
Director
Nominees
Identified in
this Proxy
Statement | | | Proposal 2:
Advisory
Vote on the
Compensation
of Our Named
Executive
Officers | | | Proposal 3:
Advisory
Resolution on the
Frequency of Future
Advisory Resolutions
on Executive
Compensation | | | Proposal 4:
Advisory Vote
to Ratify the
Selection of
Deloitte as Our
Independent
Registered
Accounting
Firm for 2024 | | Common Shares of Class A | | | 24,095,298 | | | 24,095,298 | | | 24,095,298 | | | 24,095,298 | | Stock Shares of Class B | | | 11,016,385 | | | 16,002,077 | | | 16,002,077 | | | 16,002,077 | | Common Stock Power | | | 35,111,683 | | | 40,097,375 | | | 40,097,375 | | | 40,097,375 |
The holders of a majority in voting power of the issued and outstanding shares of Class A common stock and Class B common stock (which is equal to the aggregate number of vested and unvested Partnership Units and LTIP Units held by such Class B common shareholders) collectively as a single class entitled to vote, must be present in person or represented by proxy to constitute a quorum for the transaction of business at the Annual Meeting. Abstentions are counted as present and entitled to vote for purposes of determining a quorum. Shares represented by broker non-votes (as defined below) that are present and entitled to vote at the Annual Meeting will be counted for purposes of determining a quorum. However, if you hold your shares in street name and do not provide voting instructions to your bank, broker or other holder of record, under current NYSE rules, Proposals 1, 2 and 3 are considered non-discretionary matters and a bank, broker or other holder of record will lack the authority to vote shares at the holder’s discretion on these proposals, and your shares will not be voted on these proposals (a “broker non-vote”). TABLE OF CONTENTS | | | Proposal 1:Elect
the Three Class III
Director Nominees
Identified in this
Proxy Statement | | | Proposal 2:
Advisory Resolution
to Approve Executive
Compensation | | | Proposal 3:
Advisory Resolution
on the Frequency of
Future Advisory
Resolutions to
Approve Executive
Compensation | | | Proposal 4:
Advisory Vote to
Ratify the Selection
of Deloitte as
Our Independent
Registered
Accounting Firm
for 2024 | | How many votes are required for approval? | | | > A plurality of votes cast, even if less than a majority | | | > A majority of votes cast | | | > A majority of votes cast | | | > A majority of votes cast | | How are director withhold votes treated? | | | > Withhold votes will be excluded entirely from the vote with respect to the nominee from which they are withheld and will have no effect on this proposal | | | > N/A | | | > N/A | | | > N/A | | How are abstentions treated? | | | > N/A | | | > Abstentions are counted for the purpose of establishing the presence of a quorum, but will not be counted as votes cast and will have no effect on this proposal | | | > Abstentions are counted for the purpose of establishing the presence of a quorum, but will not be counted as votes cast and will have no effect on this proposal | | | > Abstentions are counted for the purpose of establishing the presence of a quorum, but will not be counted as votes cast and will have no effect on this proposal | | How are broker non- votes treated? | | | > Broker non-votes are counted for the purpose of establishing the presence of a quorum, but are not counted as votes cast and will have no effect on this proposal | | | > Broker non-votes are counted for the purpose of establishing the presence of a quorum, but are not counted as votes cast and will have no effect on this proposal | | | > Broker non-votes are counted for the purpose of establishing the presence of a quorum, but are not counted as votes cast and will have no effect on this proposal | | | > No broker non-votes since banks, brokers and other holders of record may exercise discretion and vote on this matter and these will be counted as votes cast | | How will signed proxies that do not specify voting preferences be treated? | | | > Votes will be cast for the three director nominees identified in this Proxy Statement | | | > Votes will be cast for the approval of the compensation of our Named Executive Officers | | | > Votes will be cast to hold the non-binding advisory “Say on Pay” proposal every year (“1 year”) | | | > Votes will be cast for the selection of Deloitte as our independent public accounting firm for 2024 |
It is important to note that the proposals to approve the compensation of our Named Executive Officers, to approve the frequency of our non-binding, advisory “Say on Pay” proposal, and to ratify the selection of the independent registered public accounting firm are non-binding and advisory. However, the Board intends to carefully consider the results of Proposal 2 in making future compensation decisions and of Proposal 3 in determining the frequency of future non-binding advisory “Say on Pay” proposals, and, if our shareholders fail to ratify the selection of Deloitte, the selection of another independent registered public accounting firm may be considered by the Audit Committee. Even if the selection is ratified, the Audit Committee in its discretion may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of our company and our shareholders. TABLE OF CONTENTS Voting at the Annual Meeting The manner in which you cast your vote depends on whether you are a shareholder of record or you are a beneficial owner of shares held in “street name.” Shareholder of Record. If your shares are registered directly in your name with our transfer agent, American Stock Transfer & Trust Company, LLC, you are a shareholder of record. Beneficial Owner of Shares Held in Street Name. If your shares are held in an account at a brokerage firm, bank, broker-dealer or other similar organization, then you are a beneficial owner of shares held in “street name.” The organization holding your account is considered the shareholder of record. As a beneficial owner, you have the right to direct the organization holding your account on how to vote the shares you hold in your account. Voting by Proxy for Shares Registered Directly in the Name of the Shareholder. If you hold your shares of common stock in your own name as a shareholder of record, you may instruct the proxy holders named in the Proxy Card how to vote your shares of common stock in one of the following ways: | > | Vote by Internet. You may vote via the Internet by following the instructions provided in the Notice of Availability or, if you received printed materials, on your Proxy Card. The website for Internet voting is printed on the Notice of Availability and also on your Proxy Card. Please have your Notice of Availability or Proxy Card in hand when voting. Internet voting is available 24 hours each day until 11:59 p.m., Eastern Daylight Time, on June 19, 2024. You will receive a series of instructions that will allow you to vote your shares of common stock. You will also be given the opportunity to confirm that your instructions have been properly recorded. If you vote via the Internet, you do not need to return your Proxy Card. |
| > | Vote by Telephone. You also have the option to vote by telephone by calling the toll-free number 800-690-6903. Telephone voting is available 24 hours each day until 11:59 p.m., Eastern Daylight Time, on June 19, 2024. When you call, please have your Proxy Card in hand. You will receive a series of |
| > | voice instructions that will allow you to vote your shares of common stock. You will also be given the opportunity to confirm that your instructions have been properly recorded. If you vote by telephone, you do not need to return your Proxy Card. |
| > | Vote by Mail. If you received printed materials, and would like to vote by mail, please mark, sign and date your Proxy Card and return it promptly in the postage-paid envelope provided. If you did not receive printed materials and would like to vote by mail, you must request printed copies of the Proxy Materials by following the instructions on your Notice of Availability. |
Voting by Proxy for Shares Registered in Street Name. If your shares of common stock are held in street name, you will receive instructions from your broker, bank or other nominee that you must follow in order to have your shares of common stock voted.
Voting Online at the Annual Meeting. If you are a Class A or Class B common stock shareholder of record, you may vote and submit questions while attending the meeting online via live audio webcast. You will need the 16-Digit Control Number included on your Notice of Availability or your proxy card (if you received a printed copy of the proxy materials) in order to be able to enter the meeting. Shares held in your name as the shareholder of record may be voted by you, while the polls remain open, at www.virtualshareholdermeeting.com/PJT2024 during the meeting. You will need your 16-Digit Control Number found in the Notice of Availability or your proxy card. Even if you plan to participate in the online meeting, we recommend that you also submit your proxy or voting instructions in advance, so that your vote will be counted if you later decide not to participate in the online meeting. Street name shareholders who wish to revoke or change their votes should contact the organization that holds their shares. Shareholders of record may revoke or change their proxy by voting a new proxy pursuant to the voting methods set forth above by providing a written notice of revocation to the Corporate Secretary or by attending and voting at the Annual Meeting. TABLE OF CONTENTS Confidentiality of Your Vote We keep all the proxies, ballots and voting tabulations confidential as a matter of practice. We only let our Inspector of Election, Broadridge Financial Solutions, Inc. (“Broadridge”), examine these documents. Occasionally, shareholders provide written comments on their Proxy Card, which are then forwarded to us by Broadridge. The company is paying the costs of the solicitation of proxies. Members of the Board and officers and employees may solicit proxies by mail, telephone, fax, email or in person. We will not pay directors, officers or employees any extra amounts for soliciting proxies. We may, upon request, reimburse brokerage firms, banks or similar entities representing street name holders for their expenses in forwarding Proxy Materials to their customers who are street name holders and obtaining their voting instructions. In connection with the Annual Meeting, the company has engaged Innisfree M&A Incorporated to assist in the solicitation of proxies. The company will pay Innisfree M&A Incorporated $20,000 plus reasonable out-of-pocket expenses for its assistance. We will file a current report on Form 8-K with the SEC including the final voting results from the Annual Meeting within four business days after the Annual Meeting. For your review, we make available free of charge on or through our website at www.pjtpartners.com under the “Investor Relations/Financial Reports” section, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. Hard copies may be obtained free of charge by contacting Investor Relations at PJT Partners Inc., 280 Park Avenue, New York, New York 10017 or by calling 212-364-7810. Copies may also be accessed electronically by means of the SEC’s website on the Internet at www.sec.gov. Neither our Annual Report on Form 10-K for the year ended December 31, 2023, nor the 2023 Annual Report shall constitute a part of the proxy solicitation materials. Contacting Our Corporate Secretary In several sections of this Proxy Statement, we suggest that you should contact our Corporate Secretary to follow up on various items. You can reach our Corporate Secretary by writing to the Corporate Secretary at PJT Partners Inc., 280 Park Avenue, New York, New York 10017 or by calling 212-364-7800. IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR
THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JUNE 20, 2024
The Notice of Annual Meeting, Proxy Statement, Form of Proxy and 2023 Annual Report to
Shareholders are also available at www.proxyvote.com. HOUSEHOLDING OF ANNUAL MEETING MATERIALS Some banks, brokers and other holders of record may be participating in the practice of “householding” proxy statements, annual reports or notices. This means that only one copy of our Proxy Materials or Notice of Availability, as applicable, may have been sent to multiple shareholders in your household. If you want to receive separate copies of our Proxy Materials or Notice of Availability, or if you are receiving multiple copies and would like to receive only one copy per household, you should contact your bank, broker or other holder of record, or you may contact the Corporate Secretary as set forth above. TABLE OF CONTENTS OurThe Board does not know of any other matters that are to be presented for action at the Annual Meeting. Should any other matter arise at the Annual Meeting; however, the persons named in the enclosed proxy will have discretionary authority to vote all proxies with respect to such matters in accordance with their judgment.
BY ORDER OF THE BOARD OF DIRECTORS,
Salvatore Rappa
David K.F. Gillis
Managing Director, Corporate Counsel and
Corporate Secretary
March 16, 2022 April 29, 2024
TABLE OF CONTENTS Glossary of Terms Definitions. The following terms shall have the meanings set forth on this Appendix A whenever used in the Proxy statement. Except when otherwise indicated by context, any term used in the singular shall also include the plural. “20-day VWAP” is the volume-weighted average share price of the company’s Class A common stock over any 20 consecutive trading-day period. “ASC Topic 718” refers to the Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation – Stock Compensation. “Blackstone” refers to Blackstone Inc. “Blackstone Senior Management” refers to Blackstone’s senior management, including Mr. Schwarzman and all of Blackstone’s other Executive Officers. “Board” refers to the PJT Partners Inc. Board of Directors. “Bonus Deferral Plan” refers to the Amended and Restated PJT Partners Inc. Bonus Deferral Plan. “Broadridge” refers to Broadridge Financial Solutions, Inc. “Broker Non-Vote” refers to the condition when a proposal is considered a non-discretionary matter and a bank, broker or other holder of record will lack the authority to vote shares at the holder’s discretion and the shares will not be voted on the proposal. “CamberView” refers to CamberView Partners Holdings, LLC. “CEO” means Chief Executive Officer. “CEO Agreement” refers to the partner agreement PJT Partners Holdings entered into with Paul Taubman effective October 1, 2015. “CEO Pay Ratio” refers to the ratio of annual total compensation of Mr. Taubman, our CEO, to the median annual total compensation for all our employees (other than our CEO) as of December 31, 2023. “Code” refers to the Internal Revenue Code of 1986, as amended. “company”, “we”, “us”, and “our” refer to PJT Partners Inc., together with its consolidated subsidiaries, including PJT Partners Holdings and its operating subsidiaries. “Dynasty” refers to Dynasty Equity Partners Management, LLC, a Delaware limited liability company. “Earned Performance LTIPs” is the number of Performance LTIPs for which the performance condition has been met. “Employee Net Share Settlements” refers to net share settlements in connection with employee taxes upon the vesting of equity awards. “End Date” refers to February 28, 2027. “Exchange Act” refers to the Securities Exchange Act of 1934. “Exchange Agreement” refers to the Exchange Agreement dated as of October 1, 2015, among PJT Partners Inc., PJT Partners Holdings LP, and the Partnership Unitholders from time to time party thereto, as amended. “Executive Officer” is defined as the term is used in Item 401 of Regulation S-K. “Interests” refers collectively to the total number of shares of Class A common stock, Partnership Units or LTIP Units. “IPO” refers to an initial public offering. “IRS” refers to the Internal Revenue Service. “Limited Partnership Agreement” refers to the Third Amended and Restated Limited Partnership Agreement of PJT Partners Holdings LP, as amended. “Measurement Date” refers to the fiscal quarter end date, together with the period ending with the End Date. “Named Executive Officers” and “NEOs” refer to our Chairman and Chief Executive Officer, Paul J. Taubman; our Managing Partner, Ji-Yeun Lee; our Chief Financial Officer, Helen T. Meates and our General Counsel, David A. Travin. TABLE OF CONTENTS “Non-management directors” include all directors who are not our officers, and all non-management directors who have been determined by the Board to be independent. “Notice of Availability” refers to a Notice of Internet Availability of Proxy Materials. “NYSE” refers to the New York Stock Exchange. “Omnibus Incentive Plan” refers to the Second Amended and Restated PJT Partners Inc. 2015 Omnibus Incentive Plan approved by the shareholders on May 24, 2023. “Partnership Units” refers to certain holders of the equity in our company who maintain their ownership collectively through PJT Partners Holdings partnership units and LTIP Units. “PCAOB” refers to the Public Company Accounting Oversight Board. “Performance LTIPs” refers to a class of partnership interests in PJT Partners Holdings. “PJT Partners” refers to PJT Partners Inc. “PJT Partners Holdings” refers to PJT Partners Holdings LP, a holding partnership that holds the company’s operating subsidiaries, and certain cash and cash equivalents it may hold from time to time. As the sole general partner of PJT Partners Holdings, PJT Partners Inc. operates and controls all of the business and affairs of PJT Partners Holdings and its operating subsidiaries. “Related Person Transaction” is defined as any transaction that is anticipated and would be reportable by us under Item 404(a) of Regulation S-K in which we were or are to be a participant and the amount involved exceeds $120,000 and in which any related person had or will have a direct or indirect material interest. “PJT Shares Outstanding” as of year-end, is inclusive of our outstanding shares of Class A common stock and PJT Partners Holdings vested and unvested Partnership Units, each on a fully diluted basis, excluding unvested RSUs. “Related Person Policy” refers to a written statement of policy adopted by the Board regarding transactions with related persons. “RSU” refers to Restricted Stock Unit. “SEC” refers to the U.S. Securities and Exchange Commission. “Significant Limited Partner” refers to a limited partner who holds not less than five percent (5%) of the total number of Partnership Units then outstanding. “Street Name” means that shares are held in an account at a brokerage firm, bank, broker-dealer or other similar organization and that organization, rather than the beneficial owner, is considered the shareholder of record, holding the shares in “street name.” The beneficial owner of the shares has the right to direct the organization holding the account on how to vote the shares held in the account. “Subject Shares” refers to the irrevocable proxy provided to Mr. Taubman, empowering Mr. Taubman to vote or cause to be voted all of the shares of Class B common stock then or thereafter held by the Blackstone Senior Management. “Sublease” refers to the sublease that PJT Partners Holdings has entered into with Dynasty Equity Partners Management, LLC that commenced October 1, 2022. “Surviving Partnership” refers to another limited partnership or limited liability company organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof, which is the survivor of a merger, consolidation or combination of assets with PJT Partners Holdings. “Termination Transaction” means any direct or indirect transfer of all or any portion of PJT Partners’ interest in PJT Partners Holdings. “Willis Towers Watson” refers to Willis Towers Watson & Co., an independent outside compensation consultant. TABLE OF CONTENTS U.S. GAAP Reconciliations The following represent key performance measures that management uses in making resource allocation and/or compensation decisions. These measures should not be considered substitutes for, or superior to, financial measures prepared in accordance with GAAP. Management believes the following non-GAAP measures, when presented together with comparable GAAP measures, are useful to investors in understanding the company’s operating results: Adjusted Pretax Income; Adjusted Net Income; and Adjusted Net Income, If-Converted, in total and on a per-share basis (referred to as “Adjusted Earnings Per Share”EPS”). These non-GAAP measures, presented and discussed herein, remove the significant accounting impact of: (a) transaction-related compensation expense, including expense related to Partnership Units with both time-based vesting and market conditions as well as equity-based and cash awards granted in connection with the spin-off and acquisition of CamberView Partners Holdings, LLC (“CamberView”); (b) intangible asset amortization associated with Blackstone Inc.’s (“Blackstone”) initial public offering (“IPO”), the acquisition of PJT Capital LP, and the acquisition of CamberView; and (c) the amount the company has agreed to pay Blackstone related to the net realized cash benefit from certain compensation-related tax deductions. (a)
| Transaction-related compensation expense, including expense related to Partnership Units with both time-based vesting and market conditions as well as equity-based and cash awards granted in connection with the acquisition of CamberView Partners Holdings, LLC (“CamberView”); |
(b)
| Intangible asset amortization associated with Blackstone Inc.’s (“Blackstone”) initial public offering (“IPO”), the acquisition of PJT Capital LP, and the acquisition of CamberView; and |
(c)
| The net change to the amount the company has agreed to pay Blackstone related to the net realized cash benefit from certain compensation-related tax deductions. |
Reconciliations of the non-GAAP measures to their most directly comparable GAAP measures and further detail regarding the adjustments are provided below. To help investors understand the effect of the company’s ownership structure on its Adjusted Net Income, the company has presented Adjusted Net Income, If-Converted. This measure illustrates the impact of taxes on Adjusted Pretax Income, assuming all Partnership Units (excluding the unvested Partnership Units that have yet to satisfy certain market conditions) were exchanged for shares of the company’s Class A common stock, resulting in all of the company’s income becoming subject to corporate-level tax, considering both current and deferred income tax effects. This tax rate excludes a number of adjustments, including the tax benefits of the adjustments for transaction-related compensation expense and amortization expense and tax benefit recorded pursuant to the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”).expense. B-1
Appendix B - U.S. GAAP Reconciliations
TABLE OF CONTENTS The following table provides a reconciliation of non-GAAP measures to their most directly comparable GAAP measures. (Dollars in Thousands, Except Share and Per Share Data) | | GAAP Net Income (Loss) | | | $189,955 | | | $212,426 | | | $(6,175) | | | | Less: GAAP Provision for Taxes | | | 29,494 | | | 35,535 | | | 239 | | | | GAAP Pretax Income (Loss) | | | 219,449 | | | 247,961 | | | (5,936) | | | | Adjustments to GAAP Pretax Income (Loss) | | | | | | | | | | | | | Transaction-Related Compensation Expense(1) | | | 14,888 | | | 14,662 | | | 36,924 | | | | Amortization of Intangible Assets(2) | | | 7,777 | | | 7,776 | | | 10,939 | | | | Spin-Off-Related Payable Due to Blackstone(3) | | | 199 | | | 550 | | | — | | | | Adjusted Pretax Income | | | 242,313 | | | 270,949 | | | 41,927 | | | | Adjusted Taxes(4) | | | 35,087 | | | 38,788 | | | 1,719 | | | | Adjusted Net Income | | | 207,226 | | | 232,161 | | | $40,208 | |
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| | If-Converted Adjustments | | | | | | | | | | Less: Adjusted Taxes(4) | | | (35,087) | | | (38,788) | | | | Add: If-Converted Taxes(5) | | | 54,073 | | | 67,090 | | | | Adjusted Net Income, If-Converted | | | $188,240 | | | $203,859 | | | | GAAP Net Income Per Share of Class A Common Stock | | | | | | | | | | Basic | | | $4.25 | | | $4.80 | | | | Diluted | | | $3.99 | | | $4.40 | | | | GAAP Weighted-Average Shares of Class A
Common Stock Outstanding | | | | | | | | | | Basic | | | 24,959,382 | | | 24,496,285 | | | | Diluted | | | 42,358,705 | | | 43,127,166 | | | | Adjusted Net Income, If-Converted Per Share | | | $4.44 | | | $4.93 | | | | Weighted-Average Shares Outstanding, If-Converted | | | 42,363,237 | | | 41,365,572 | |
The following table provides a summary of weighted-average shares outstanding for the year ended December 31, 2021 and 2020 for both basic and diluted shares. The table also provides a reconciliation to If-Converted Shares Outstanding assuming that all Partnership Units and unvested PJT Partners Inc. restricted stock units (“RSUs”) were converted to shares of the company’s Class A common stock:
| | Weighted-Average Shares Outstanding - GAAP | | | | | | | | | | Basic Shares Outstanding, GAAP | | | 24,959,382 | | | 24,496,285 | | | | Dilutive Impact of Unvested RSUs(6) | | | 1,680,900 | | | 1,344,152 | | | | Dilutive Impact of Partnership Units(7) | | | 15,718,423 | | | 17,286,729 | | | | Diluted Shares Outstanding, GAAP | | | 42,358,705 | | | 43,127,166 | | | | Weighted-Average Shares Outstanding - If-Converted | | | | | | | | | | Basic Shares Outstanding, GAAP | | | 24,959,382 | | | 24,496,285 | | | | Unvested RSUs(8) | | | 1,685,432 | | | 1,360,635 | | | | Partnership Units(7) | | | 15,718,423 | | | 15,508,652 | | | | If-Converted Shares Outstanding | | | 42,363,237 | | | 41,365,572 | |
| | | Year Ended
December 31, | | | | 2023 | | | 2022 | | GAAP Net Income | | | $145,682 | | | $164,772 | | Less: GAAP Provision for Taxes | | | 31,927 | | | 36,699 | | GAAP Pretax Income | | | 177,609 | | | 201,471 | | Adjustments to GAAP Pretax Income | | | | | | | Transaction-Related Compensation Expense(1) | | | — | | | 11,765 | Amortization of Intangible Assets(2) | | | 4,920 | | | 6,506 | Spin-Off-Related Payable Due to Blackstone(3) | | | 136 | | | 804 | | Adjusted Pretax Income | | | 182,665 | | | 220,546 | Adjusted Taxes(4) | | | 32,768 | | | 40,020 | | Adjusted Net Income | | | 149,897 | | | 180,526 | | If-Converted Adjustments | | | | | | | Less: Adjusted Taxes(4) | | | (32,768) | | | (40,020) | Add: If-Converted Taxes(5) | | | 46,297 | | | 57,264 | | Adjusted Net Income, If-Converted | | | $136,368 | | | $163,282 | | GAAP Net Income Per Share of Class A Common Stock | | | | | | | | Basic | | | $3.24 | | | $3.61 | | Diluted | | | $3.12 | | | $3.51 | GAAP Weighted-Average Shares of Class A
Common Stock Outstanding Basic | | | 25,255,327 | | | 25,077,835 | | Diluted | | | 41,882,034 | | | 26,616,640 | | Adjusted Net Income, If-Converted Per Share | | | $3.27 | | | $3.92 | | Weighted-Average Shares Outstanding, If-Converted | | | 41,749,633 | | | 41,663,773 |
(1)
| This adjustment adds back to GAAP Pretax Income transaction-related compensation expense for Partnership Units with both time-based vesting and market conditions as well as equity-based and cash awards granted in connection with the spin-off and the acquisition of CamberView. |
TABLE OF CONTENTS
(2)
| This adjustment adds back to GAAP Pretax Income amounts for the amortization of intangible assets that are associated with Blackstone’s IPO, the acquisition of PJT Capital LP on October 1, 2015 and the acquisition of CamberView on October 1, 2018. |
(3)
| This adjustment adds back to GAAP Pretax Income the net change to the amount the company has agreed to pay Blackstone related to the net realized cash benefit from certain compensation-related tax deductions. |
(4)
| Represents taxes on Adjusted Pretax Income, considering both current and deferred income tax effects for the current ownership structure. |
(5)
| Represents taxes on Adjusted Pretax Income, assuming all Partnership Units (excluding the unvested Partnership unitsUnits that have yet to satisfy market conditions) werehave been exchanged for shares of the company’s Class A common stock, resulting in all of the company’s income becoming subject to corporate-level tax, considering both current and deferred income tax effects. This tax rate excludes a number of adjustments, including the tax benefits of the adjustments for transaction-related compensation expense and amortization expense and tax benefit recorded pursuant to the CARES Act.expense. |
B-2
Appendix B - U.S. GAAP Reconciliations
TABLE OF CONTENTS The following table provides a summary of weighted-average shares outstanding for the year ended December 31, 2023 and 2022 for both basic and diluted shares. The table also provides a reconciliation to If-Converted Shares Outstanding assuming that all Partnership Units and unvested PJT Partners Inc. RSUs were converted to shares of the company’s Class A common stock: | | | Year Ended
December 31, | | | | 2023 | | | 2022 | | Weighted-Average Shares Outstanding - GAAP | | | | | | | | Basic Shares Outstanding, GAAP | | | 25,255,327 | | | 25,077,835 | Dilutive Impact of Unvested RSUs(1) | | | 1,711,829 | | | 1,538,805 | Dilutive Impact of Partnership Unit(2) | | | 14,914,878 | | | — | | Diluted Shares Outstanding, GAAP | | | 41,882,034 | | | 26,616,640 | Weighted-Average Shares Outstanding - If-Converted | | | | | | | | Basic Shares Outstanding, GAAP | | | 25,255,327 | | | 25,077,835 | Unvested RSUs(3) | | | 1,711,829 | | | 1,540,744 | Partnership Units(4) | | | 14,782,477 | | | 15,045,194 | | If-Converted Shares Outstanding | | | 41,749,633 | | | 41,663,773 |
As of December 31, 2023, in relation to awards granted containing both service and market conditions, the Company achieved a dividend adjusted 20-day volume-weighted average share price in excess of $100. As a result, 1.3 million share equivalents were included in the Company's fully-diluted share count, of which 0.3 million had satisfied both service and market conditions, with the remaining 1.0 million vesting pursuant to ongoing service conditions. In addition, 1.4 million share equivalents had not yet satisfied certain market conditions and were therefore excluded from any share count calculations. (1)
| Represents the dilutive impact under the treasury method of unvested, non-participating RSUs that have a remaining service requirement. |
(7)
(2)
| Represents the number of shares assuming the conversion of vested Partnership Units, the dilutive impact of unvested Partnership Units with a remaining service requirement, and the dilutive impact of Partnership Units that achieved certain market conditions.conditions as if those conditions were achieved as of the beginning of the reporting period. |
(8)
(3)
| Represents the dilutive impact of unvested RSUs that have a remaining service requirement. |
A-3
(4)
| Represents the number of shares assuming the conversion of all Partnership Units, including Partnership Units that achieved certain market conditions as of the date those conditions were achieved, and excludes Partnership Units that have yet to satisfy certain market conditions. |
B-3
Appendix B - U.S. GAAP Reconciliations
iso4217:USD xbrli:shares |
