Document:

pjt-ex105_715.htm

Exhibit 10.5

renewal AND MODIFICATION AGREEMENT

This Renewal and Modification Agreement (this “Agreement”), dated as of February 1, 2021 for reference purposes only, is made by and between PJT Partners Holdings LP (“Borrower”) and First Republic Bank (the “Lender”), with reference to the following facts:

A.The Lender has previously made or committed to make revolving loans in the aggregate maximum principal amount of $40,000,000.00 (with a provision for an increase to $60,000,000.00 at certain times of the year) to Borrower (the “Loan”).

B.The Loan arises out of that certain Amended and Restated Loan Agreement dated October 1, 2018 (as amended, the “Loan Agreement”) to which Borrower and the Lender are parties.  The Loan is evidenced by Borrower’s Amended and Restated Promissory Note dated October 1, 2018 (the “Note”).  All terms with an initial capital letter that are used but not defined in this Agreement shall have the respective meanings given to such terms in the Loan Agreement.

C.Borrower has requested that Lender (i) extend the maturity date of the Note from October 1, 2021 to October 1, 2022, (ii) increase the principal amount of the Commitment from $40,000,000.00 (with a provision for an increase to $60,000,000.00 at certain times of the year) to $60,000,000.00 (with a provision for an increase to $80,000,000.00 at certain times of the year) and (iii) make certain other changes to the Loan Documents, and Lender has agreed to do so on the terms set forth herein.

THEREFORE, for valuable consideration, the Lender and Borrower agree as follows:

1.Extension of Line of Credit Note Maturity Date.  The Maturity Date of the Note is extended to October 1, 2022, at which time the entire unpaid principal balance of the Note, all accrued and unpaid interest and any other outstanding amounts due Lender under the Loan Documents shall be due and payable.  The Note and the Loan Documents are amended accordingly, and the Line of Credit Note is being concurrently amended and restated as the Second Amended and Restated Promissory Note (Line of Credit – Prime Rate Adjustable – Interest Only) dated February 1, 2021 (the “Second Amended and Restated Promissory Note”), which Second Amended and Restated Promissory Note shall hereafter be deemed to mean the Line of Credit Note, as amended herein.

2.Principal Amount of the Commitment.  The principal amount of the Commitment (and the face amount of the Line of Credit Note) is hereby increased from the principal amount of $40,000,000.00 (with a provision for an increase to $60,000,000.00 at certain times of the year) to $60,000,000.00 (with a provision for an increase to $80,000,000.00 at certain times of the year) pursuant to the terms of the Loan Documents and the terms of the Second Amended and Restated Promissory Note.  Accordingly, the following provisions of the Loan Agreement are hereby amended to reflect such increase:

2.1Section 1.24 of the Loan Agreement is amended and restated in its entirety as follows:

1.24Request for Increase.  A written request in the form of Exhibit E for a temporary increase of the Commitment up to Eighty Million and no/100 Dollars ($80,000,000.00) pursuant this Agreement.

2.2Section 2.1(a) of the Loan Agreement is amended and restated in its entirety as follows:

(a)Borrower may, on or after November 1st of any year, submit a Request for Increase to increase the Commitment (an “Increase”) between December 1st and March 1st of the immediately following calendar year (or a portion of such period).  Each Request for Increase shall state the time period during the upcoming three-month period for the Increase to be in place (such period of time for such increase, the “Increase Period”).

2.3Section 2.1(b) of the Loan Agreement is amended and restated in its entirety as follows:

(b)If an Increase is put into place, Borrower must repay to Lender Line of Credit Advances such that by the end of the Increase Period (but which shall in no event be after March 1st (or if such date is 

 

 

not a Business Day, then the next succeeding Business Day) of any year in which an Increase is in place) the aggregate outstanding principal amount of the Line of Credit Advances is not greater than $60,000,000.  At the end of the Increase Period the Commitment shall automatically be reduced to $60,000,000, and in no event shall the Commitment exceed $60,000,000 at any time between March 2nd and November 30th in any calendar year.

2.4Exhibit E attached hereto is added to the Loan Agreement as Exhibit E.

3.Line of Credit Loan Interest Rate.  The interest rate payable on the Line of Credit Loan is amended to provide for an interest rate floor of no less than two and 75/100 percent (2.75%) per annum, pursuant to the terms of the Second Amended and Restated Promissory Note.

4.Covenants.  Exhibit D to the Loan Agreement is hereby amended and restated in its entirety with Exhibit D attached hereto.

5.Execution of Second Amended and Restated Promissory Note.  Concurrently with the execution of this Agreement, Borrower shall execute and deliver to Lender the Second Amended and Restated Promissory Note.  All references to the “Line of Credit Note” in the Loan Documents shall hereafter refer to and be the Second Amended and Restated Promissory Note, which when executed in favor of and delivered to Lender shall supersede and replace, in its entirety, the Note (as referenced in Recital A hereof).

6.Merger of Third Party Pledgors.  By their execution of this Agreement, (a) Lender acknowledges its prior consent to the merger of Third Party Pledgor Park Hill Group LLC with and into Third Party Pledgor PJT Partners LP (the “Merger”), (b) Borrower acknowledges that as a result of such Merger the “Collateral” pledged by PJT Partners LP to Lender under the Third Party Pledge Agreement between PJT Partners LP and Lender dated or about October 1, 2015 includes the “Collateral” pledged by Park Hill Group LLC to Lender under the Third Party Pledge Agreement between Park Hill Group LLC and Lender dated on or about October 1, 2015 and (c) Lender and Borrower agree that all references to Park Hill Group LLC as a Third Party Pledgor under the Loan Agreement shall be deemed a reference to PJT Partners LP (as successor by merger to Park Hill Group LLC).

7.Representations and Warranties.  As a material inducement to the Lender’s execution of this Agreement, Borrower makes the following warranties and representations to the Lender:

7.1Borrower has the full power and authority to enter into and perform all of its obligations under this Agreement, and this Agreement, when executed by the Persons signing this Agreement on behalf of Borrower, shall constitute a legal, valid and binding obligation of Borrower enforceable in accordance with its terms (except as enforcement may be limited by equitable principles and by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to creditors’ rights generally and regardless of whether enforcement is sought in equity or at law).  The Persons executing this Agreement on behalf of Borrower have been duly authorized to execute this Agreement by all required action on the part of Borrower.

7.2There are no liens affecting all or part or the Collateral, except for the liens in favor of the Lender and the Permitted Liens.

7.3No Event of Default has occurred and is continuing.

8.No Modification of Loan Documents.  Nothing contained in this Agreement shall be construed to obligate the Lender to extend the time for payment of the Second Amended and Restated Promissory Note or otherwise modify any of the Loan Documents in any respect, except as expressly set forth in this Agreement.

9.No Waiver.  No waiver by the Lender of any of its rights or remedies in connection with the Loan Documents shall be effective unless such waiver is in writing and signed by the Lender.  The Lender’s rights and remedies under this Agreement are cumulative with and in addition to any and all other legal and equitable rights and remedies which the Lender may have in connection with the Loans.

10.Entire Agreement.  This Agreement and the other Loan Documents contain the entire agreement and understanding among the parties concerning the matters covered by this Agreement and other Loan Documents and supersede all prior and contemporaneous agreements, statements, understandings, terms, conditions, negotiations, 

 

 

representations and warranties, whether written or oral, made by the Lender or Borrower concerning the matters covered by this Agreement and the other Loan Documents.

11.Modifications.  This Agreement may be modified only by a written agreement signed by Borrower and the Lender.

12.Descriptive Headings; Interpretation.  The headings to sections of this Agreement are for convenient reference only and shall not be used in interpreting this Agreement.  For purposes of this Agreement, the term “including” shall be deemed to mean “including without limitation.”

13.Renewal/Modification Fees.  Borrower shall pay to the Lender, upon execution of this Agreement, (a) a loan fee of $60,000.00 and (b) all reasonable and documented out-of-pocket costs, charges, and expenses paid or incurred by the Lender in connection with the preparation of this Agreement and the transactions contemplated hereby, including reasonable attorneys’ fees (all of which amounts will be debited from Borrower’s account number [removed]).  Borrower shall pay all reasonable and documented out-of-pocket costs and expenses, including reasonable attorneys’ fees and costs, incurred by the Lender in enforcing any of the terms of this Agreement or the other Loan Documents, whether or not any legal proceedings are instituted by the Lender.

14.Indemnification.  Borrower shall indemnify and hold the Lender and its officers, directors, agents, employees, representatives, shareholders, affiliates, successors and assigns (collectively, the “Indemnified Parties”) harmless from and against any and all claims, demands, damages, liabilities, actions, causes of action, suits, reasonable costs and expenses, including reasonable attorneys’ fees and costs, directly arising out of or relating to any commission or brokerage fee or charge claimed to be due or owing to any Person in connection with the transactions contemplated by this Agreement as a result of any act or agreement by the Borrower.

15.No Third Party Beneficiaries.  This Agreement is entered into for the sole benefit of the Lender and Borrower, and no other Person shall have any right of action under this Agreement.

16.NO CLAIMS.  BORROWER ACKNOWLEDGES AND AGREES THAT (A) IT HAS NO OFFSETS OR DEDUCTIONS OF ANY KIND AGAINST ANY OR ALL OF THE OBLIGATIONS; AND (B) IT HAS NO DEFENSES OR OTHER CLAIMS OR CAUSES OF ACTION OF ANY KIND AGAINST THE LENDER IN CONNECTION WITH THE LOANS OR THE COLLATERAL.

17.Continuing Effect of Documents.  The Second Amended and Restated Promissory Note and the other Loan Documents, as modified by this Agreement, shall remain in full force and effect in accordance with their terms and are affirmed by Borrower.

18.Counterparts; Successors.  This Agreement may be executed in counterparts, each of which shall constitute an original, and all of which together shall constitute one and the same agreement.  This Agreement shall be binding upon and shall inure to the benefit of the parties and their respective permitted successors and assigns.

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Renewal and Modification Agreement as of the date first above written.

 

						
	
BORROWER:
	
 
	
LENDER:

	
 
	
 
	
 
	
 
	
 
	
 

	
PJT Partners Holdings LP
	
 
	
First Republic Bank

	
 
	
 
	
 

	
By:
	
PJT Partners Inc.,
	
 
	
 
	
 

	
 
	
its General Partner
	
 
	
By:
	
/s/ Stephen J. Szanto

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
By:
	
/s/ Helen T. Meates
	
 
	
Name:
	
Stephen J. Szanto

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
Name:
	
Helen T. Meates
	
 
	
Title:
	
Senior Managing Director

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
Title:
	
CFO
	
 
	
 
	
 

 

PJT Partners LP executes this Renewal and Modification Agreement for the sole purpose of evidencing its acknowledgement and agreement to Section 6(b) hereof:

 

						
	
PJT Partners LP
	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
By:
	
PJT Management, LLC,
	
 
	
 

	
 
	
its general partner
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
By:
	
PJT Partners Holdings LP
	
 
	
 

	
 
	
 
	
its sole member
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
By:
	
PJT Partners, Inc.,
	
 
	
 

	
 
	
 
	
 
	
its general partner
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
By:
	
/s/ Helen T. Meates
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
Name:
	
Helen T. Meates
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
Title:
	
CFO
	
 
	
 

 

 

 

 

 

 

Exhibit D

COVENANTS

This Exhibit D is an integral part of the Agreement between the Lender and Borrower, and the following terms are incorporated in and made a part of the Agreement to which this Exhibit D is attached:

	
1.
	
Financial Covenants.

1.1No Additional Indebtedness.  Without the prior written consent of the Lender, Borrower:  (a) shall not incur indebtedness for borrowed money during the term of this Agreement, excluding (i) debts owing by Borrower as of the date of this Agreement that were previously disclosed in writing to Lender, (ii) other borrowing from the Lender (or an affiliate of Lender), (iii) unsecured debt incurred in the ordinary course of business, (iv) indebtedness incurred to finance the acquisition, construction or improvement of any fixed or capital assets (including capital lease obligations) and any indebtedness assumed in connection with the acquisition of any such assets, (v) debts owing by Borrower to another Loan Party or any affiliate of a Loan Party and (vi) other indebtedness up to an aggregate amount not to exceed $20,000,000 at any time outstanding (which other indebtedness under this clause (vi) shall include but not be limited to all indebtedness that is excluded from liabilities pursuant to Sections (b) and (c) of the definition of “Tangible Net Worth” in Section 1.2 of this Exhibit D and all indebtedness that is excluded from the definition of “Debt” in Section 1.3 of this Exhibit D); and (b) shall not directly or indirectly make, create, incur, assume or permit to exist any guaranty of any kind of any indebtedness of any other Person during the term of this Agreement, excluding (i) any guaranties by Borrower as of the date of this Agreement previously disclosed in writing to Lender, (ii) guaranties by Borrower incurred in connection with any employee loan program arranged by Lender, (iii) guaranties incurred in connection with lease agreements entered into by the Borrower or any of its affiliates and other guaranties incurred in the ordinary course of business (including in respect of any leasehold obligations) and not in respect of indebtedness for borrowed money and (iv) guaranties in respect of indebtedness of Borrower’s affiliates if the Borrower would have been able to incur such indebtedness directly under the foregoing clause (a), provided that the amount of such guaranties under this Section (1.1)(iii) and (iv) do not exceed an aggregate face value of $20,000,000 in the aggregate at any time.

1.2Minimum Tangible Net Worth.  Borrower shall at all times maintain a Tangible Net Worth of not less than $300,000,000.

“Tangible Net Worth” is defined as the excess of total assets minus total liabilities, determined in accordance with generally accepted accounting principles with the following adjustments:  (a) there will be excluded from assets (i) notes, accounts receivable and other obligations owing from officers, members, partners or affiliates, and (ii) all assets which would be classified as intangible assets under generally accepted accounting principles including goodwill, licenses, patents, trademarks, trade names, copyrights, capitalized software and organizational costs and franchises; (b) there will be excluded from liabilities all indebtedness which is either secured on a junior lien basis with respect to the Obligations, unsecured or subordinated to the Obligations; and (c) there will be excluded from liabilities all liabilities in respect of any deferred rent obligations.

1.3Minimum Cash Flow Coverage Ratio.  Borrower shall maintain a Minimum Cash Flow Coverage Ratio of not less than 1.50:1.00.  This ratio shall be measured on a calendar year-to-date basis as of December 31, 2018 and on a calendar year-to-date basis as of the end of each successive calendar quarter thereafter.

“Minimum Cash Flow Coverage Ratio” for each applicable calendar year-to-date measurement period is defined as (i) annual net income plus interest, taxes, depreciation and amortization plus any recorded non-cash expense related to restricted stock units granted to employees minus dividends and distributions paid divided by (ii) the sum of required principal payments plus interest expense.

 

 

1.4Leverage Ratio.  Borrower shall at all times maintain a ratio of Debt to Adjusted EBITDA as follows, measured as of the last day of each quarter:

(a)if Adjusted EBITDA is equal to or greater than $35,000,000, then such ratio shall not exceed 2.00:1.00;

 (b)if Adjusted EBITDA is equal to or greater than $20,000,000 but less than $35,000,000, then such ratio shall not exceed 1.50:1.00; and

(c)if Adjusted EBITDA is less than $20,000,000, then such ratio shall not exceed 1.00:1.00.

The term “Debt” means total liabilities of Borrower minus (x) any indebtedness which is either secured on a junior lien basis with respect to the Obligations, unsecured or subordinated to the Obligations and (y) any unsecured indebtedness that is junior in priority to the Loans. For the avoidance of doubt, “Debt” shall include the indebtedness of any other entity (including any partnership in which the Borrower is a general partner) to the extent the Borrower is liable therefor as a result of the Borrower’s ownership interest in or other relationship with such entity, except to the extent the terms of such indebtedness expressly provide that the Borrower is not liable therefor.

The term “Adjusted EBITDA” means Borrower’s EBITDA for the previous four quarters plus any recorded non-cash expenses related to restricted stock units granted to employees during such four quarters less any dividends paid during such four quarters.

1.5Liquidity.  Borrower shall at all times maintain on a consolidated basis a ratio of Unencumbered Liquid Assets to then total current liabilities of not less than 1.25:1.00.  This ratio shall be measured quarterly as of the last day of each quarter.

“Unencumbered Liquid Assets” is defined as the following assets:  (a) cash and certificates of deposit; (b) the fair market value of treasury bills and other obligations of the U.S. Federal Government; (c) readily marketable securities that can be converted into cash within three (3) days without penalty or prepayment fee; (d) commercial paper; (e) Eligible Accounts Receivable and (f) money market mutual or similar funds that invest exclusively in assets satisfying the requirements of clauses (a) through (d) of this definition.  Excluded from assets are (g) retirement accounts and (h) restricted stock and stock subject to provisions of Rule 144 of the Securities and Exchange Commission.

The term “Eligible Accounts Receivable” means (a) 50% of all bona fide accounts receivable generated in the ordinary course of business of PJT Partners LP’s business unit formerly known as Park Hill Group LLC, and (b) 75% of all bona fide accounts receivable generated in the ordinary course of business of Borrower and PJT Partners LP; provided, however, that the term Eligible Accounts Receivable shall not include (i) any accounts receivable in which Lender does not have a perfected security interest of first priority or (ii) any accounts receivable:

(A)that have been invoiced and not paid within 90 days of the due date;

(B)for which any of the actions described in Sections 4.1(e), (h), (i) or (j) hereof has occurred with respect to the account debtor;

(C)with respect to which the account debtor disputes liability or makes any claim and Lender reasonably believes that there is a basis for such dispute (but only up to the disputed or claimed amount);

(D)with respect to which the Borrower or any of its affiliates owes the account debtor, but only to the amount owed (i.e., contra accounts); or

(E)with respect to which the account debtor is an affiliate of the Borrower or an officer or director of the Borrower or any or its affiliates, or any Person having the power or ability to control the Borrower. For the avoidance of doubt, The Blackstone Group L.P. and its subsidiaries shall not be deemed affiliates of the Borrower. 

 

 

The Eligible Accounts Receivable shall be determined from the quarterly accounts receivable aging statement submitted by the Borrower pursuant to this Agreement.

 

	
2.
	
Reporting Covenants.

2.1Annual Financial Statements for General Partner of the Borrower.  Borrower shall deliver to Lender annual financial statements, including balance sheet and income statements, within 90 days after the end of each fiscal year, which financial statements shall be audited by an independent certified public accountant of national standing (or otherwise reasonably acceptable to Lender). 

2.2Interim Financial Statements for General Partner of the Borrower.  Borrower shall deliver to Lender internally prepared quarterly financial statements (excluding any notes thereto), including balance sheet and income statements, within 60 days after the end of each fiscal quarter, certified by such entity’s chief financial officer or other officer or representative of such entity acceptable to Lender.  

2.3Compliance Certificate.  Borrower shall deliver to Lender quarterly a compliance certificate, on Lender’s standard form, within 45 days after the end of each quarter, certified by Borrower’s chief financial officer or other officer or representative of Borrower acceptable to Lender. 

2.4Accounts Receivable Aging Statement.  Borrower shall, and shall ensure that Pledgor shall, deliver to Lender quarterly accounts receivable aging statements, substantially in the form delivered to Lender in connection with the Loan Closing, within 45 days after the end of each fiscal quarter, certified by the chief financial officer of Borrower/Pledgor or other officer or representative of each such entity acceptable to Lender.

 

 

 

 

 

EXHIBIT E

FORM OF REQUEST FOR INCREASE

[DATE]1

First Republic Bank

1230 Avenue of the Americas, 2nd Floor

New York, NY 10020 

Attn: Business Banking 

Telephone:  415-364-4420

Email:bbnycompliance@firstrepublic.com 

	
 
	
RE: 
	
That certain Amended and Restated Loan Agreement dated as of October 1, 2018 by and between FIRST REPUBLIC BANK (“Lender”) and PJT PARTNERS HOLDINGS LP (“Borrower”) (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Loan Agreement”).  Capitalized terms not defined herein shall have the meanings assigned to such terms in the Loan Agreement.

Ladies and Gentlemen:

This Request for Increase is executed and delivered by Borrower to Lender pursuant to Section 2.1(a) of the Loan Agreement.

1.Borrower hereby requests an Increase in the Commitment in the amount of $[INCREASE AMOUNT] for an aggregate Commitment of $[NEW MAXIMUM COMMITMENT] during the Increase Period.  The Increase Period for such Increase shall be from [DATE] until [DATE2].

2.In connection with this Request, Borrower hereby represents, warrants and certifies to the Lender that:

(a)As of the effective date of such Increase and immediately after giving effect thereto, the representations and warranties set forth in the Loan Agreement and the other Loan Documents are true and correct in all material respects with the same force and effect as if made on and as of such date;

(b)No Event of Default shall have occurred and is continuing on and as of the date hereof or will exist on the date any request herein becomes effective; and

(c)After any request herein becomes effective the aggregate outstanding Line of Credit Advances will not exceed the Commitment.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

	
	 

	
1 
	
 To be submitted on or after November 1 of any year.

	
2 
	
 Increase Period shall be between December 1 and March 1 of immediately following year (or a portion of such period).

 

 

 

The undersigned hereby certify each and every matter contained herein to be true and correct.

BORROWER: 

PJT Partners Holdings LP

 

	
By:
	
PJT Partners Inc., its General Partner
	
 

	
 
	
 
	
 
	
 

	
 
	
By:
	
 
	
 

	
 
	
Name:
	
 

	
 
	
Title:
	
 
	
 

 

ACKNOWLEDGED AND ACCEPTED:

 

	
FIRST REPUBLIC BANK
	
 

	
 
	
 
	
 
	
 

	
By:
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
Name:
	
 
	
 

	
 
	
Title:
	
 
	
 

	
Date:
	
 
	
 

 

 

 

 

 

 

ACKNOWLEDGMENT OF RENEWAL AND MODIFICATION AGREEMENT AND

REAFFIRMATION OF THIRD PARTY PLEDGE AGREEMENT

Section 1.The undersigned Pledgor hereby acknowledges and confirms that it has reviewed and approves the terms and conditions of the Renewal and Modification Agreement dated on or about even date herewith between PJT Partners Holdings LP (“Borrower”) and First Republic Bank (“Lender”) (the “Amendment”).

Section 2.The undersigned Pledgor hereby consents to the Amendment and agrees that all obligations covered by the Third Party Pledge Agreement executed by the Pledgor in favor of Lender (which include Borrower’s increased obligations under the Second Amended and Restated Promissory Note) shall continue in full force and effect, shall be valid and enforceable and shall not be impaired or otherwise affected by the execution of the Amendment or any other document or instrument delivered in connection herewith.

Section 3.The undersigned Pledgor represents and warrants that, after giving effect to the Amendment, all representations and warranties contained in said Third Party Pledge Agreement are true, accurate and complete as if made the date hereof.

Dated as of February 1, 2021

 

 

						
	
PLEDGOR

	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
PJT PARTNERS LP

	
 
	
 
	
 
	
 
	
 

	
By:
	
PJT Management, LLC, its

	
 
	
general partner

	
 
	
By:
	
PJT Partners Holdings LP, its

	
 
	
 
	
sole member

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
By:
	
PJT Partners Inc., its

	
 
	
 
	
 
	
general partner

	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
By:
	
/s/ Helen T. Meates
	
 

	
 
	
 
	
 
	
Name:
	
Helen T. Meates
	
 

	
 
	
 
	
 
	
Title:
	
CFO
	
 

 

 

 

 

 

	
 
	
 

 

 

SECOND AMENDED AND RESTATED PROMISSORY NOTE

 

(Line of Credit - Prime Rate Adjustable - Interest Only)

 

	
$60,000,000.00
	
February 1, 2021

1.Promise to Pay.  At the times stated in this Note, for value received, PJT Partners Holdings LP (“Borrower”), promises to pay to First Republic Bank (“Lender”), or order, at 111 Pine Street, San Francisco, California 94111, Attention:  Commercial Loan Operations, or at such other place as the Lender may from time to time designate in writing, the principal sum of Sixty Million and no/100 Dollars ($60,000,000.00), or so much thereof as may be disbursed by the Lender, with interest from the date of initial disbursement of all or any part of the principal of this Note (the “Disbursement Date”) on unpaid principal at the interest rate or interest rates provided for in this Note.

The principal amount of this Note is subject to an increase of up to Eighty Million and no/100 Dollars ($80,000,000) from time to time pursuant to the provisions of the Loan Agreement relating to the Increase.

This Second Amended and Restated Promissory Note (“Note”) supersedes and replaces in its entirety that certain Amended and Restated Promissory Note dated October 1, 2018 (the “2018 Note”), which is deemed cancelled and no longer in effect.  Any Line of Credit Advances outstanding on the date hereof shall, without the necessity of any action, become Line of Credit Advances hereunder.

2.Interest Rate; Payment of Principal and Interest.

2.1Certain Definitions.  For purposes of this Note, the following terms shall have the following definitions:

(a)Note Rate.  The per annum interest rate on the principal sum of this Note which is outstanding from time to time.

(b)Index.  The rate of interest published in the Western Edition of The Wall Street Journal as the U.S. “prime rate”.

(c)Interest Payment Date.  February 15, 2021 and the same date of each month thereafter (or if such date is not a Business Day, then the next succeeding Business Day) to and including the same date of the month immediately preceding the month in which the Maturity Date occurs.

2.2Interest.  From the Disbursement Date to the Maturity Date of this Note, the Note Rate shall be equal to the greater of (i) the Index minus one percent (1.0%) per annum rounded upward to the nearest one-eighth (1/8th) of one percentage point (0.125%), and (ii) two and 75/100 percent (2.75%) per annum, subject to Section 0 below.  The Note Rate shall be adjusted concurrently with, and such adjustments shall be effective on the same date as, adjustments announced in the Index.

2.3Payments.  Principal and interest shall be due and payable as follows:

(a)Interest Payments.  Interest shall be payable in arrears commencing on the first (1st) Interest Payment Date after the Disbursement Date and continuing on each Interest Payment Date thereafter until the Maturity Date.  

(b)Payment on Maturity Date.  The entire unpaid principal balance of this Note and all accrued and unpaid interest thereon shall be due and payable on October 1, 2022 (the “Maturity Date”).  BORROWER ACKNOWLEDGES AND AGREES THAT (1) THE LOAN EVIDENCED BY THIS NOTE IS NOT AN AMORTIZING LOAN; AND (2) THE ENTIRE PRINCIPAL BALANCE OF THIS NOTE SHALL BE DUE AND PAYABLE ON THE MATURITY DATE OF THIS NOTE.

 

 

3.Loan Agreement; Interest Computation.  This Note arises out of an Amended and Restated Loan Agreement dated October 1, 2018 (the “Loan Agreement”) executed by Borrower and Lender.  This Note is the “Line of Credit Note” described in the Loan Agreement.  All terms with an initial capital letter that are used but not specifically defined in this Note shall have respective meanings given to such terms in the Loan Agreement.  All payments under this Note shall be made in immediately available funds and shall be credited first to accrued interest then due, thereafter to unpaid principal, and then to other charges, fees, costs, and expenses payable by Borrower under this Note or in connection with the loan evidenced by this Note (the “Loan”) in such order and amounts as the Lender may determine in its sole and absolute discretion.  If any payment of interest is not made when due, at the option of the Lender, such interest payment shall bear interest at the same rate as principal from and after the due date of the interest payment.  Principal and interest shall be payable only in lawful money of the United States of America.  The receipt of any check or other item of payment (a “payment item”) by the Lender, at its option, shall not be considered a payment until such payment item is honored when presented for payment at the drawee bank or institution, and the Lender, at its option, may delay the credit of such payment until such payment item is so honored.  Notwithstanding anything to the contrary contained in this Note, interest at the rates provided for in this Note shall be computed on the basis of a three hundred sixty (360) day year for the actual number of days during which the principal balance of this Note is outstanding.  Borrower acknowledges and agrees that the calculation of interest on the basis described in the immediately preceding sentence may result in the accrual and payment of interest in amounts greater than those which would be payable if interest were calculated on the basis of a three hundred sixty-five (365) day year.

4.After Maturity/Default Rate of Interest.  From and after either (a) the occurrence of an Event of Default (whether or not the Lender has elected to accelerate unpaid principal and interest under this Note as a result of such Event of Default); or (b) the maturity of this Note (whether the stated maturity date of this Note or the maturity date resulting from the Lender’s acceleration of unpaid principal and interest), then in either of such circumstances, interest on any unpaid principal balance of this Note that is overdue shall accrue at a rate equal to two percent (2.00%) per annum above the otherwise applicable Note Rate.

5.Late Charge.  If any installment of interest under this Note is not paid within ten (10) days after the date on which it is due (other than as a result of Lender’s failure to make any automatic deduction from the Account (if sufficient funds are then in the Account) or Lender’s gross negligence or willful misconduct), Borrower shall immediately pay a late charge equal to two percent (2.00%) of such installment to the Lender to compensate the Lender for administrative costs and expenses incurred in connection with such late payment.  Borrower agrees that the actual damages suffered by the Lender because of any late installment payment are extremely difficult and impracticable to ascertain, and the late charge described in this Section represents a reasonable attempt to fix such damages under the circumstances existing at the time this Note is executed.  The Lender’s acceptance of any late charge shall not constitute a waiver of any of the terms of this Note and shall not affect the Lender’s right to enforce any of its rights and remedies against any Person liable for payment of this Note.

6.Waivers.  Borrower and all sureties, guarantors, endorsers and other Persons liable for payment of this Note (a) waive presentment, demand for payment, protest, notice of demand, dishonor, protest and nonpayment, and all other notices and demands in connection with the delivery, acceptance, performance, default under, and enforcement of this Note; (b) waive the right to assert any statute of limitations as a defense to the enforcement of this Note to the fullest extent permitted by law; (c) consent to all extensions and renewals of the time of payment of this Note and to all modifications of this Note by the Lender and Borrower without notice to and without in any way affecting the liability of any Person for payment of this Note; and (d) consent to any forbearance by the Lender and to the release, addition, and substitution of any Person liable for payment of this Note and of any or all of the security for this Note without notice to and without in any way affecting the liability of any Person for payment of this Note.

7.Default.  The Loan Agreement provides, among other things, for the acceleration of the unpaid principal balance and accrued interest under this Note upon the occurrence of certain events.  The Lender, at its option and without notice to or demand on Borrower or any other Person, may terminate any or all obligations which it may have to extend further credit to Borrower and may declare the entire unpaid principal balance of this Note and all accrued interest thereon to be immediately due and payable upon the occurrence and during the continuation of any Event of Default.

8.Application of Payments.  Upon the occurrence and during the continuation of any Event of Default, the Lender, at its option, shall have the right to apply all payments made under this Note to principal, interest, and other charges, fees, costs and expenses payable by Borrower under this Note or in connection with the Loan in such order and amounts as the Lender may determine in its sole and absolute discretion.

 

 

 

 

 

9.Modifications; Cumulative Remedies; Loss of Note; Time of Essence.  No modification or waiver by the Lender of any of the terms of this Note shall be valid or binding on the Lender unless such modification or waiver is in writing and signed by the Lender.  The Lender’s rights and remedies under this Note are cumulative with and in addition to all other legal and equitable rights and remedies which the Lender may have in connection with the Loan.  The headings to sections of this Note are for convenient reference only and shall not be used in interpreting this Note.  If this Note is lost, stolen, or destroyed, upon Borrower’s receipt of a reasonably satisfactory indemnification agreement executed by the Lender, or if this Note is mutilated, upon the Lender’s surrender of the mutilated Note to Borrower, Borrower shall execute and deliver to the Lender a new promissory note which is identical in form and content to this Note to replace the lost, stolen, destroyed or mutilated Note.  Time is of the essence in the performance of each provision of this Note by Borrower.

10.Attorneys’ Fees.  If Borrower defaults under any of the terms of this Note, Borrower shall pay all costs and expenses, including without limitation attorneys’ fees and costs, incurred by the Lender in enforcing this Note immediately upon the Lender’s demand, whether or not any action or proceeding is commenced by the Lender.

11.Applicable Law; Prepayment; Successors.  This Note shall be governed by and interpreted in accordance with the laws of the State of New York.  Borrower shall have the right to prepay all or part of the outstanding principal balance of this Note at any time without payment to the Lender of a prepayment fee or charge.  This Note shall be the joint and several obligation of all Persons executing this Note as Borrower and all sureties, guarantors, and endorsers of this Note, and this Note shall be binding upon each of such Persons and their respective successors and permitted assigns.  This Note shall inure to the benefit of the Lender and its successors and permitted assigns.

12.Index.  If the Index becomes unavailable, the Lender shall, in consultation with the Borrower, select a comparable index (the “Substituted Index”).  In such event, if applicable, the Lender shall adjust the interest rate spread set forth above (the “Spread”) such that the sum of the Substituted Index and the adjusted Spread equals the sum of the prior Index plus the prior Spread.  Borrower acknowledges that the Index may not represent the lowest interest rate charged by the Lender and that Lender may make loans at, above or below the Index or based on other reference rates.

13.Security.  This Note is secured by the Security Agreements.

14.Cancellation of 2018 Note.  Lender, by its acceptance of this Note, agrees to promptly return the original 2018 Note marked “cancelled” to Borrower at the address provided by Borrower to Lender.

[The remainder of this page intentionally left blank.]

 

 

 

 

 

 

	
BORROWER:
	
 

	
 
	
 

	
PJT Partners Holdings LP
	
 

	
 
	
 
	
 
	
 

	
By:
	
PJT Partners, Inc., its General Partner
	
 

	
 
	
 
	
 
	
 

	
 
	
By:
	
/s/ Helen T. Meates
	
 

	
 
	
 
	
 
	
 

	
 
	
Name:
	
Helen T. Meates
	
 

	
 
	
 
	
 
	
 

	
 
	
Title:
	
CFOpjt-ex1015_716.htm

Exhibit 10.15 

AMENDED AND RESTATED

PJT PARTNERS INC. BONUS DEFERRAL PLAN

(Effective February 2021)

 

Purpose

This Amended and Restated PJT Partners Inc. Bonus Deferral Plan (the “Plan”) represents a deferred compensation plan for certain eligible employees and partners of PJT Partners Inc. (“PJT Partners”) and certain of its affiliates in order to provide such individuals with pre-tax deferred incentive compensation awards and thereby enhance the alignment of interests between such individuals and the Company and its affiliates.  This Plan governs Annual Bonuses (as defined below) earned in respect of 2016 and subsequent calendar years.  This Plan operates as a sub-plan to the PJT Partners Inc. 2015 Omnibus Incentive Plan and, accordingly, any Common Shares (as defined below) or equity-based awards thereon issued pursuant to this Plan will be deemed as issued under the share reserve established under the PJT Partners Inc. 2015 Omnibus Incentive Plan.

ARTICLE I.
DEFINITIONS

As used herein, the following terms have the meanings set forth below.

“Affiliated Employer” means, except as provided under Section 409A of the Code and the regulations promulgated thereunder, any company or other entity that is related to the Company as a member of a controlled group of corporations in accordance with Section 414(b) of the Code or as a trade or business under common control in accordance with Section 414(c) of the Code.

“Annual Bonus” means the annual bonus awarded to a Participant with respect to a given Fiscal Year under the applicable annual bonus plan, program, agreement or other arrangement (as designated by the Plan Administrator in its sole discretion); provided that a Participant’s Annual Bonus for purposes of this Plan shall exclude any bonus or other amount, the payment of which has been guaranteed or promised to the Participant at any time prior to the Annual Bonus Notification Date pursuant to any agreement, plan, program or other arrangement between the Participant and the Company (a “Guaranteed Bonus”) unless the document evidencing the Guaranteed Bonus expressly provides for the deferral of all or a specified portion of such Guaranteed Bonus, in which case such deferral will occur pursuant to the terms and conditions set forth in such document. Notwithstanding the foregoing, if the Plan Administrator determines that the deferral under the Plan of a Participant’s Guaranteed Bonus likely would result in the imposition of tax or penalties under Section 409A of the Code, the Participant’s Annual Bonus shall exclude such Guaranteed Bonus.

“Annual Bonus Notification Date” means the date on which the Company notifies a Participant of the amount of such Participant’s Annual Bonus (if any) for the relevant Fiscal Year.

“Board” means the board of directors of PJT Partners.

“Bonus Deferral Amount” has the meaning set forth in Section 3.01(a).

“Cause,” with respect to a Participant, has the meaning set forth in the Employment Agreement to which such Participant is a party.

“Change in Control” means, with respect to the Company, a “Change in Control” as defined under the Equity Incentive Plan, to the extent that such event also constitutes a “change of control” within the meaning of Section 409A of the Code and the regulations and Internal Revenue Service guidance promulgated thereunder.

“Code” means the Internal Revenue Code of 1986, as amended.

 

 

“Common Shares” means the publicly-traded shares of Class A Common Stock of PJT Partners which are available for issuance under the Equity Incentive Plan.

“Company” means PJT Partners and each Participating Employer (individually or collectively as the context requires). 

“Competitive Activity” means a Participant’s engagement in any activity that would constitute a violation of any non-competition covenants to which the Participant is subject under the Participant’s Employment Agreement, determined without regard to the actual duration of such non-competition covenants pursuant to the Employment Agreement.

“Deferral Award” means such number of Common Shares, RSUs or other equity-based awards denominated in Common Shares calculated in accordance with Section 3.01(b).

“Delivery Date” shall mean the date upon which Common Shares (or, if applicable, cash or other securities) are delivered with respect to any Deferral Award, as set forth in Section 5.01.

“Disability” has the meaning as provided under Section 409A(a)(2)(C)(i) of the Code.

“Employment” means (i) a Participant’s employment if the Participant is an employee of PJT Partners or any Affiliated Employer or (ii) a Participant’s services as a partner of PJT Partners or any Affiliated Employer if the Participant is a partner.

“Employment Agreement” means, with respect to a Participant, the Contracting Employment Agreement (including all schedules and exhibits thereto) or, with respect to a Participant who is a partner, the Partner Agreement (including all schedules and exhibits thereto), as applicable, to which such Participant is a party.

“Equity Incentive Plan” means the PJT Partners Inc. 2015 Omnibus Incentive Plan or such other plan as the Plan Administrator may designate in its sole discretion.

“Fair Market Value” shall have the meaning given to such term in the Equity Incentive Plan; provided that, with respect to a security other than Common Shares, if the fair market value of such security cannot reasonably be determined pursuant to the foregoing definition, the Fair Market Value of such security shall be the value thereof as determined pursuant to a valuation made by the Plan Administrator in good faith and based upon a reasonable valuation method.

“Fiscal Year” means the fiscal year of PJT Partners.

“Grant Date” has the meaning set forth in Section 3.01(b).

“Participant” means a participant selected by the Plan Administrator in accordance with Section 2.01 hereof.

“Participating Employer” means PJT Partners and each Affiliated Employer (or division or unit of an Affiliated Employer) that is designated as a “Participating Employer” by the Plan Administrator and which adopts this Plan.

“Person” means any individual, partnership, corporation, limited liability company, unincorporated organization, trust, joint venture or enterprise or a governmental agency or political subdivision thereof.

“Plan Account” has the meaning given to such term in Section 3.01(b).

“Plan Administrator” means the Compensation Committee of the Board, or such other person or persons as the Board may appoint for such purpose from time to time. Additionally, the Plan Administrator may delegate its authority under the Plan to any employee or group of employees of PJT Partners or an Affiliate Employer; provided 

 

 

 

that (i) such delegation is consistent with applicable law and guidelines established by the Board from time to time and (ii) determinations made pursuant to Article VII hereof may be made only by the Plan Administrator.

“Retirement” means a Participant’s Separation from Service (whether voluntary or involuntary) after (i) the Participant has reached age sixty-five (65) and has at least five (5) full years of service with the Company and Blackstone or (ii) (A) the Participant’s age plus years of service with the Company and Blackstone totals at least sixty-five (65), (B) the Participant has reached age fifty-five (55) and (C) the Participant has had a minimum of five (5) years of service the Company and Blackstone.

“RSUs” means restricted stock units on Common Shares.

“Separation from Service” means a Participant’s “separation from service” with the Company within the meaning of Section 409A of the Code and the regulations thereunder.

“Vesting Date” has the meaning set forth in Sections 4.01(b). 

“Vesting Period” has the meaning set forth in Section 4.01(b).

ARTICLE II.
PLAN PARTICIPATION

2.01.Plan Participation. Each Fiscal Year, on or prior to the Annual Bonus Notification Date for such Fiscal Year, the Plan Administrator, in its sole discretion, will select Participants from among the employees and partners of the Participating Employers and will notify such individuals that they have been selected to participate in the Plan for such Fiscal Year.  The Plan Administrator may, in its sole discretion, establish different rules and/or sub-plans under the Plan (x) with respect to Participants based outside of the United States and Participants who are employees of, or other service providers for, a “nonqualified entity” within the meaning of Section 457A of the Code, in each case, in a manner intended to address tax, administrative and securities law considerations with respect to the Company and such Participants or (y) on such terms as are approved by the Plan Administrator and communicated to the applicable Participants prior to or coincident with the Annual Bonus Notification Date. Such alternate rules and/or sub-plans may include, without limitation, different treatment with respect to timing of vesting and delivery of Common Shares (or, if applicable, cash or other securities) under the Plan and may be set forth in Schedules to be attached hereto from time to time.

ARTICLE III.
DEFERRALS

3.01.Bonus Award Deferrals.

(a)With respect to a given Fiscal Year commencing with the Fiscal Year ending December 31, 2016, and for each Participant selected to participate in the Plan in accordance with Section 2.01 hereof, a portion of the Annual Bonus (excluding any portion thereof that is being separately deferred pursuant to this Plan or any other agreement, plan, program or other arrangement between the Participant and the Company) for the Fiscal Year shall be deferred (his or her “Bonus Deferral Amount”) in accordance with the following table (or such other table that may be adopted by the Plan Administrator prior to or coincident with the Annual Bonus Notification Date):

			
	
Portion of Annual Bonus
	
Marginal Deferral Rate Applicable to Such Portion
	
Effective Deferral Rate for Entire Annual Bonus*

	
$0 - 100,000
	
0.0%
	
0.0%

	
$100,001 - 200,000
	
20.0%
	
10.0%

	
$200,001 - 500,000
	
25.0%
	
19.0%

	
$500,001 - 750,000
	
35.0%
	
24.3%

	
$750,001 - 1,250,000
	
45.0%
	
32.6%

	
$1,250,001 - 2,000,000
	
50.0%
	
39.1%

 

 

 

			
	
Portion of Annual Bonus
	
Marginal Deferral Rate Applicable to Such Portion
	
Effective Deferral Rate for Entire Annual Bonus*

	
$2,000,001 - 3,000,000
	
55.0%
	
44.4%

	
$3,000,001 - 4,000,000
	
60.0%
	
48.3%

	
$4,000,001 - 5,000,000
	
65.0%
	
51.7%

	
$5,000,000 +
	
70.0%
	
57.8%

 

* Effective Deferral Rates are shown for illustrative purposes only and are based on an Annual Bonus equal to the maximum amount in the range shown in the far left column (which is assumed to be $7,500,000 for the last range shown).

For purposes of determining the Bonus Deferral Amount pursuant to the above table, a Participant’s total annual incentive compensation shall be taken into account, although the Bonus Deferral Amount shall only reduce (but not below zero) the amount of the Annual Bonus otherwise payable in cash on a current basis.

Notwithstanding the foregoing: (i) if a Participant’s Annual Bonus includes a Guaranteed Bonus, such Participant’s Bonus Deferral Amount shall be equal to (x) the portion of the Guaranteed Bonus which the document evidencing the Guaranteed Bonus states will be deferred, plus (y) a portion of the amount (if any) by which the Participant’s Annual Bonus exceeds his or her Guaranteed Bonus, determined pursuant to the table above and (ii) the Company reserves the right to change the method by which a Participant’s Bonus Deferral Amount will be calculated with respect to any Annual Bonus by notifying the Participant in writing in advance of the Annual Bonus Notification Date for such Annual Bonus. Deferral of each Participant’s Bonus Deferral Amount for the relevant Fiscal Year shall be automatic and mandatory. The excess of the Participant’s Annual Bonus for the relevant Fiscal Year over his or her Bonus Deferral Amount for such Fiscal Year shall be paid to the Participant on such date and in the same manner as such Participant’s Annual Bonus would have been paid to him or her if he or she was not a Participant in the Plan with respect to such Fiscal Year.

(b)Subject to subsection (c) below, the number of Common Shares underlying a Deferral Award shall be calculated by dividing (x) such Participant’s entire Bonus Deferral Amount for the Fiscal Year by (y) the average closing prices of a Common Share over the five trading days immediately prior to and the five trading days immediately following (in each case, as reported on the national exchange on which the Common Shares are listed on such date) the date that PJT Partners first publicly issues its earnings release for the corresponding Fiscal Year (the final such trading day being the “Grant Date”).  The resulting number of Common Shares shall be rounded up to the nearest whole number and granted under the Deferral Award on the Grant Date.  The Company will keep on its books and records an account for each Participant (his or her “Plan Account”), in which the Company will record the number of Common Shares underlying the Deferral Award awarded to such Participant.

(c)Notwithstanding anything to the contrary contained in this Plan, no later than the Annual Bonus Notification Date, the Plan Administrator, in its sole discretion, may designate any portion of the Bonus Deferral Amount to be awarded in the form of cash subject to repayment in certain circumstances (and not as part of a Deferral Award).  If any portion of the Bonus Deferral Amount is so designated, (i) the calculation of Common Shares underlying the Deferral Award in subsection (b) above shall be recalculated proportionally and (ii) such cash portion shall be paid to the Participant no later than March 15 of the year following the year in which the Annual Bonus Notification Date occurs.

ARTICLE IV.
VESTING

4.01.Vesting.

(a)Deferral Award. Subject to Article VI and Article VII, and except as otherwise provided in Sections 6.01(b), 6.01(e), 6.01(f) and 6.01(g), one-third of the Common Shares underlying the Deferral Award granted to a Participant in respect of a given Fiscal Year will vest (but will only be deliverable pursuant to Article V) on the March 1 that immediately follows the end of each of the second, third and fourth Fiscal Year after the Fiscal 

 

 

 

Year to which the relevant Annual Bonus relates with respect to Partners, and the first, second and third Fiscal Years after the Fiscal Year to which the relevant Annual Bonus relates with respect all other employees, in each case subject to the Participant remaining continuously Employed with the Company through the applicable Vesting Date (or on such other vesting schedule selected by the Plan Administrator and communicated to the Participant prior to or coincident with the Annual Bonus Notification Date or as otherwise set forth in prior versions of this Plan). For the avoidance of doubt, the Common Shares underlying Deferral Award shall not be eligible for partial-year vesting.

(b)Vesting Date; Vesting Period. For purposes of this Plan, and except as otherwise provided in Sections 6.01(b), 6.01(e), 6.01(f) and 6.01(g), the date upon which all or a portion of a Participant’s Deferral Award vests in accordance with the provisions of this Section 4.01 shall be referred to as the “Vesting Date” for such portion of the Deferral Award. The period between the grant date of a Deferral Award and the Vesting Date on which such Deferral Award vests in accordance with the provisions hereof shall be referred to as the “Vesting Period.”

ARTICLE v.
DELIVERY OF SHARES

5.01.Delivery Generally. The Common Shares (or, if applicable, cash or other securities) underlying the Deferral Award shall generally be delivered to Participants as set forth below:

(a)Delivery Date. The “Delivery Date” for each Common Share underlying a Deferral Award shall be the Vesting Date applicable to such Deferral Award, subject to the discretion and limitation set forth in Section 5.02.

(b)Form of Delivery. On the applicable Delivery Date, or as soon as reasonably practicable after such Delivery Date (but in no event more than ten (10) business days after such Delivery Date, subject to the discretion and limitation set forth in Section 5.02), the Company shall issue to the Participant, in full settlement of the Company’s obligations with respect to the deliverable portion of the Participant’s Deferral Award, unless otherwise provided in a service agreement between the Participant and PJT Partners or any of its affiliates, (i) the number of Common Shares subject to such Deferral Award or (ii) an amount in cash or other securities, including a number of interests in PJT Partners Holdings LP, with equivalent value to the closing price of such underlying number of Common Shares as of the trading day immediately prior to the date of such payment (as reported on the national exchange on which the Common Shares are listed on each such date), or a combination of (i) and/or(ii), as determined by the Plan Administrator. 

5.02.Issuance of Common Shares. The issuance of any Common Shares to a Participant pursuant to the Plan shall be effectuated by recording the Participant’s ownership of such Common Shares in a book-entry or similar system utilized by the Company as soon as practicable following the Delivery Date applicable thereto. Any Common Shares issued to a Participant hereunder will be held in an account administered by the Company’s equity plan administrator or such other account as the Plan Administrator may determine in its discretion. No Participant shall have any rights as an owner with respect to any Common Shares under the Plan prior to the date on which the Participant becomes entitled to delivery of such Common Shares in accordance with Section 5.01. The Plan Administrator may, in its sole discretion, cause the Company to defer the delivery of any Common Shares (or, if applicable, cash or other securities) pursuant to this Plan as the Plan Administrator deems reasonably necessary to ensure compliance under federal or state securities laws, the Company’s insider trading policy or a Company-imposed “blackout period”; provided, that, such delivery shall be made at the earliest date at which the Plan Administrator reasonably anticipates would not result in such noncompliance and in no event later than the last day of the calendar year in which the applicable Vesting Date occurs.

5.03.Taxes and Withholding. As a condition to any payment or distribution pursuant to this Plan, the Company may require a Participant to pay such sum to the Company as may be necessary to discharge the Company’s obligations with respect to any taxes, assessments or other governmental charges, whether of the United States or any other jurisdiction, which the Company reasonably expects will be imposed as a result of such payment or distribution. In the discretion of the Company, the Company may deduct or withhold such sum from such payment or distribution (including by deduction or withholding of Common Shares (or, if applicable, other securities), provided that the amount the Company deducts or withholds shall not (unless otherwise determined by 

 

 

 

the Plan Administrator) exceed the Company’s minimum statutory withholding obligations. Alternatively, the Company may elect to satisfy the tax withholding obligations by advancing and remitting its own funds on behalf of the Participant to the applicable tax authorities, in which case the Participant shall be required to repay such amounts to the Company within 5 days of such remittance, together with interest thereon based on the Company’s cost of funds as determined by PJT Partners Treasury from time to time. In the event that the Company plans to advance a tax withholding remittance on behalf of the Participant as described in the preceding sentence, the Company shall provide the Participant with reasonable advance notice to permit the Participant to remit the required funds in cash to the Company prior to the required withholding date and thereby avoid the need to have the Company advance its own funds to the tax authorities.

5.04.Liability for Payment. Each Participating Employer shall be liable for the amount of any distribution or payment owed to a Participant pursuant to Section 5.01 who is Employed by such Participating Employer during the relevant Vesting Period; provided, however, that in the event that a Participant is Employed by more than one Participating Employer during the relevant Vesting Period, each Participating Employer shall be liable for its allocable portion of such distribution or payment.

ARTICLE vi.
TERMINATION OF EMPLOYMENT; CHANGE IN CONTROL

6.01.Termination of Employment. In the event that a Participant’s Employment with the Company is terminated, or a Change in Control occurs, in either case prior to the Vesting Date or Delivery Date that would otherwise apply to any portion of such Participant’s Deferral Award, vesting and delivery (if any) of the Deferral Award shall be governed by this Section 6.01.

(a)Termination by the Company For Cause. Upon termination of a Participant’s Employment by the Company for Cause, all portions of such Participant’s Deferral Award (vested and unvested) shall be forfeited without any payment.

(b)Termination by the Company Without Cause. Upon termination of a Participant’s Employment with the Company without Cause at such time as the Participant does not qualify for Retirement, such Participant’s unvested portion of the Deferral Award shall immediately vest (in which case, the date of the Participant’s termination without Cause shall be referred to as the “Vesting Date” for such portion of the Deferral Award) and be delivered to the Participant in accordance with Article V.

(c)Resignation. In the event that a Participant resigns from the Company, such Participant’s unvested portion of the Deferral Award shall be forfeited without payment.

(d)Retirement. In the event of a Participant’s Retirement from the Company, all of such Participant’s unvested portion of the Deferral Award shall continue to vest in accordance with Article IV, and shall continue to be delivered to the Participant in accordance with Article V, as though the Participant remained continuously Employed with the Company through the end of the Vesting Period; provided that if, following a termination of his or her Employment with the Company as described in this Section 6.01(d), such Participant breaches any applicable provision of the Employment Agreement to which the Participant is a party or otherwise engages in any Competitive Activity, such Participant’s portion of the Deferral Award which remains undelivered as of the date of such violation or engagement in Competitive Activity, as determined by the Plan Administrator in its sole discretion, will be forfeited without payment.  As a pre-condition to a Participant’s right to continued vesting following Retirement, the Plan Administrator may require the Participant to certify in writing prior to each scheduled Vesting Date that the Participant has not breached any applicable provisions of the Participant’s Employment Agreement or otherwise engaged in any Competitive Activity.

(e)Disability. In the event that a Participant’s Employment with the Company is terminated due to the Participant’s Disability, such Participant’s unvested portion of the Deferral Award shall immediately vest (in which case, the date of the Participant’s termination due to Disability shall be referred to as the “Vesting Date” for such portion of the Deferral Award) and be delivered to the Participant in accordance with Article V.

 

 

 

(f)Death. In the event of a Participant’s death during his or her Employment with the Company, or during the period following termination of Employment in which any portion of his or her Deferral Award remains subject to vesting pursuant to this Section 6.01, such Participant’s portion of the Deferral Award which remains unvested as of (and have not been forfeited prior to) the date of the Participant’s death shall immediately vest and, together with any previously vested but undelivered portions of the Deferral Award, become deliverable to the Participant’s estate as of the date of the Participant’s death (in which case, the date of the Participant’s death shall be referred to as the “Vesting Date” for such portion of the Deferral Award).

(g)Change in Control. Notwithstanding anything to the contrary herein, in the event of a Change in Control, such Participant’s portion of the Deferral Award which remains unvested as of the date of such Change in Control shall immediately vest and become deliverable as of the date of such Change in Control (in which case, the date of such Change in Control shall be referred to as the “Vesting Date” for such portion of the Deferral Award).

(h)Section 409A; Separation from Service. References in this Section 6.01 to a Participant’s termination of Employment shall refer to the date upon which the Participant has a Separation from Service.

6.02.Nontransferability. No benefit under the Plan shall be subject in any manner to alienation, sale, transfer, assignment, pledge or encumbrance, other than by will or the laws of descent and distribution. Any attempt to violate the foregoing prohibition shall be void; provided, however, that a Participant may transfer or assign any vested interest hereunder in connection with estate planning and administration with the express written consent of the Plan Administrator.

ARTICLE vIi.

CANCELLATION AND FORFEITURE

7.01.Cancellation and Forfeiture Events.  Notwithstanding anything to the contrary in this Plan, if at any time before an applicable Vesting Date, the Plan Administrator has determined, in its sole and absolute discretion, that any of the following events has occurred, the Company is authorized to cancel (and the Participant would forfeit) an appropriate portion of the then unvested portion of the Participant’s Deferral Award and any rights to dividend equivalents thereon:

(a)misconduct by the Participant in taking actions, or failing to take actions, that result in, or reasonably could be expected to result in, material detriment to the Company or its business activities, including without limitation financial or reputational harm to the Company or its business activities;

(b)fraud, material misrepresentation or other dishonest acts by the Participant which resulted in a determination by the Plan Administrator of an amount of such Participant’s Annual Bonus that was greater than the amount the Participant would have otherwise been entitled to but for such fraud, material misrepresentation or other dishonest act;

(c)the Participant’s gross negligence in, or other impropriety related to (including any failure to monitor or discharge supervisory or managerial responsibilities), failing to timely and reasonably identify, raise or assess issues and/or concerns with respect to risks material to the Company or its business activities; or 

(d)following the termination of the Participant’s Employment, the Company determines that such Participant’s Employment could have been terminated by the Company for Cause.

7.02.No Limitation on Other Remedies.  Nothing in this Article VII shall limit or restrict the Company from seeking repayment of any vested portions of a Bonus Deferral Amount already distributed to a Participant, pursuant to any applicable clawback requirements imposed under applicable laws, rules and regulations.  Accordingly, Section 7.01 shall (i) be in addition to the requirements of Section 304 of the Sarbanes-Oxley Act of 2002 that are applicable to the Company’s Chief Executive Officer and Chief Financial Officer and (ii) otherwise be deemed automatically amended to include the requirements of Section 954 of the Dodd-Frank Wall Street Reform 

 

 

 

and Consumer Protection Act, as it may be amended from time to time, and any related rules or regulations promulgated by the Securities Exchange Commission or the New York Stock Exchange.

ARTICLE viII.
ADMINISTRATION

8.01.Plan Administrator. The Plan shall be administered by the Plan Administrator. The Plan Administrator shall have discretionary authority to interpret the Plan, to make all legal and factual determinations and to determine all questions arising in the administration of the Plan, including without limitation the reconciliation of any inconsistent provisions, the resolution of ambiguities, the correction of any defects, and the supplying of omissions. Each interpretation, determination or other action made or taken pursuant to the Plan by the Plan Administrator shall be final and binding on all persons.

8.02.Indemnification. The Plan Administrator shall not be liable to any Participant for any action or determination. The Plan Administrator shall be indemnified by the Company against any liabilities, costs, and expenses (including, without limitation, reasonable attorneys’ fees) incurred by him or her as a result of actions taken or not taken in connection with the Plan.

ARTICLE ix.
AMENDMENTS AND TERMINATION

9.01.Modification; Termination. The Plan Administrator may alter, amend, modify, suspend or terminate the Plan at any time in its sole discretion, to the extent permitted by Section 409A of the Code. No further deferrals will occur under the Plan after the effective date of any such suspension or termination. Following any such termination, the Participant’s Deferral Award will continue to vest and be delivered, or be forfeited, as otherwise provided herein. Notwithstanding the foregoing, no alteration, amendment or modification of the Plan shall adversely affect the rights of the Participant in any amounts or shares accrued by or credited to such Participant prior to such action without the Participant’s written consent unless the Plan Administrator determines, in its sole discretion, that such alternation, modification or amendment is necessary for the Plan to comply with the requirements of Section 409A of the Code and the regulations promulgated thereunder.

9.02.Required Delay. Notwithstanding any provision to the contrary, if pursuant to the provisions of Section 409A of the Code any distribution or payment is required to be delayed as a result of a Participant being deemed to be a “specified employee” within the meaning of that term under Section 409A(a)(2)(B) of the Code, then any such distributions or payments under the Plan shall not be made or provided prior to the earlier of (A) the expiration of the six month period measured from the date of the Participant’s Separation from Service or (B) the date of the Participant’s death. Upon the expiration of such period, or the date of such Participant’s death, as applicable, all distributions or payments under the Plan delayed pursuant to this Section 9.02 shall be delivered or paid to the Participant (or the Participant’s estate, as applicable) in a lump sum, and any remaining distributions or payments due under the Plan shall be paid or delivered in accordance with the normal Delivery Dates specified for such distributions or payments herein.

ARTICLE x.
GENERAL PROVISIONS

10.01.Unfunded Status of the Plan. The Plan is unfunded. A Participant’s rights under the Plan (if any) shall represent at all times an unfunded and unsecured contractual obligation of each Participating Employer that Employed Participant during the Vesting Periods and through the Delivery Dates applicable to such Participant’s Deferral Award. Each Participant and his or her estate and/or beneficiaries (if any) will be unsecured creditors of each Participating Employer with which such Participant is or was Employed with respect to any obligations owed to such Participant, estate and/or beneficiaries under the Plan. Amounts deliverable or payable under the Plan will be satisfied solely out of the general assets of the applicable Participating Employer subject to the claims of its creditors. None of a Participant, his or her estate, his or her beneficiaries (if any) nor any other person shall have any right to receive any payment or distribution under the Plan except as, and to the extent, expressly provided in the Plan. No Participating Employer will segregate any funds or assets to provide for any payment or distribution under the Plan or issue any notes or security for any such distribution or payment. Any 

 

 

 

reserve or other asset that a Participating Employer may establish or acquire to assure itself of the funds to provide distributions or payments required under the Plan shall not serve in any way as security to any Participant or the estate or beneficiary of a Participant for the performance of the Participating Employer under the Plan.

10.02.No Right to Continued Employment. Neither the Plan nor any action taken or omitted to be taken pursuant to or in connection with the Plan shall be deemed to (i) create or confer on a Participant any right to be retained in the employ of the Company, (ii) interfere with or to limit in any way the Company’s right to terminate the Employment of a Participant at any time, (iii) confer on a Participant any right or entitlement to compensation in any specific amount for any future Fiscal Year or (iv) affect, supersede, amend or change the Employment Agreement (or any other agreement between the Participant and the Company). In addition, selection of an individual as a Participant for a given Fiscal Year shall not be deemed to create or confer on the Participant any right to participate in the Plan, or in any similar plan or program that may be established by the Company, in respect of any future Fiscal Year.

10.03.No Shareholder or Ownership Rights Prior to Delivery of Shares; Dividend Equivalent Payments. 

(a)Except as set forth in Section 10.03(b), Participants shall not have voting, dividend, cash distribution or any other rights as a holder of Common Shares until the issuance or transfer thereof to the Participant. For the avoidance of doubt,  a Deferral Award represents an unfunded and unsecured right to receive Common Shares (or, if applicable, cash or other securities) on an applicable Delivery Date and, until such Delivery Date, the Participant shall have no ownership rights with respect to the Common Shares, cash or other securities underlying such Participant’s Deferral Award; provided that Participants shall be entitled to dividend equivalents in accordance with Section 10.03(b).

(b)With respect to any Deferral Awards made in the form of RSUs, whenever any per share dividend or distribution is paid by PJT Partners on Common Shares during the period between the grant date of the Deferral Award and the date that the underlying RSUs are settled, on the date that such dividend or distribution is paid, PJT Partners shall credit to the Participant a number of additional RSUs equal to the quotient obtained by dividing (i) the product of the total number of the Participant’s outstanding RSUs (including any RSUs that have been previously credited to the Participant hereunder) as of the date thereof and the per share amount of such dividend or distribution by (ii) the Fair Market Value of one Common Share on the date such dividend or distribution is paid by PJT Partners, rounded down to the nearest whole share.  The additional RSUs so credited shall be or become vested to the same extent as the RSUs that resulted in the crediting of such additional RSUs, with respect to each vesting tranche of RSUs.  A Participant’s right to receive such dividend equivalent payments with respect to Deferral Award shall cease upon the forfeiture or settlement of such Deferral Award.

10.04.Right to Offset. The Company shall have the right to deduct from amounts owed to a Participant under the Plan the amount of any deficit, debt or other liability or obligation of any kind which the Participant may at that time have with respect to the Company; provided, however, that no such right to deduct or offset shall arise or otherwise be deemed to arise until the date upon which Common Shares (or, if applicable, cash or other securities) are deliverable or payable hereunder and any such deduction or offset shall be implemented in a manner intended to avoid subjecting the Participant to additional taxation under Section 409A of the Code.

10.05.Successors. The obligations of the Company under this Plan shall be binding upon the successors of the Company.

10.06.Governing Law. The Plan shall be subject to and construed in accordance with the laws of the State of New York.

10.07.Arbitration; Venue. Any dispute, controversy or claim between any Participant and the Company arising out of or concerning the provisions of this Plan shall be finally resolved in accordance with the arbitration provisions (and the jurisdiction, venue and similar provisions related thereto) of the Employment Agreement to which such Participant is a party.

 

 

 

10.08.Construction. The headings in this Plan have been inserted for convenience of reference only and are to be ignored in any construction of any provision hereof. Use of one gender includes the other, and the singular and plural include each other.

10.09.Section 409A.   Notwithstanding any provision of the Plan to the contrary, it is intended that the provisions of the Plan either be exempt from or comply with the requirements of Section 409A of the Code and, accordingly, the Plan shall be construed and administered in accordance with such intent to the maximum extent permitted.  In furtherance thereof, reference is made to Section 6.01(h), Section 9.01 and Section 9.02 of the Plan.

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