PRER14A
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

(Amendment No. 2)

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

 

 

Filed by the Registrant                   Filed by a Party other than the Registrant  

Check the appropriate box:

 

  Preliminary Proxy Statement
  Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
  Definitive Proxy Statement
  Definitive Additional Materials
  Soliciting Material under §240.14a-12

FinTech Acquisition Corp. IV

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

  No fee required.
  Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
  (1)  

Title of each class of securities to which transaction applies:

 

  (2)  

Aggregate number of securities to which transaction applies:

 

  (3)  

Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

  (4)  

Proposed maximum aggregate value of transaction:

 

  (5)  

Total fee paid:

 

  Fee paid previously with preliminary materials.
  Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
  (1)  

Amount Previously Paid:

 

 

  (2)  

Form, Schedule or Registration Statement No.:

 

 

  (3)  

Filing Party:

 

 

  (4)  

Date Filed:

 

 

 

 

 


Table of Contents

FINTECH ACQUISITION CORP. IV

2929 Arch Street, Suite 1703

Philadelphia, PA 19104-2870

PROXY STATEMENT FOR SPECIAL MEETING IN LIEU OF

2021 ANNUAL MEETING OF STOCKHOLDERS

Dear FinTech Acquisition Corp. IV Stockholders:

We cordially invite you to attend a special meeting (the “Special Meeting”) of the stockholders of FinTech Acquisition Corp. IV, a Delaware corporation (“we,” “us,” “our,” the “Company” or “FTIV”), which will be held virtually on                , 2021 at                Eastern Time, accessible at www.cstproxy.com/fintechacquisitioncorpiv/sm2021, or at such other time, on such other date and at such other place to which the meeting may be adjourned or postponed.

On December 30, 2020, FTIV announced that it entered into a Business Combination Agreement (the “Business Combination Agreement”), dated as of December 29, 2020, by and among FTIV, FinTech Investor Holdings IV, LLC, a Delaware limited liability company, FinTech Masala Advisors, LLC, a Delaware limited liability company (together with FinTech Investor Holdings IV, LLC, “Sponsor”), PWP Holdings LP, a Delaware limited partnership (“PWP OpCo”), PWP GP LLC, a Delaware limited liability company and the general partner of PWP OpCo (“PWP GP”), PWP Professional Partners LP, a Delaware limited partnership and a limited partner of PWP OpCo (“Professional Partners”), and Perella Weinberg Partners LLC, a Delaware limited liability company and the general partner of Professional Partners (“Professionals GP”), pursuant to which, among other things, (i) FTIV will acquire certain partnership interests in PWP OpCo, (ii) PWP OpCo will become jointly-owned by the Company, Professional Partners and certain existing partners of PWP OpCo, and (iii) PWP OpCo will, following the closing of the transactions contemplated by the Business Combination (the “Closing”), serve as the Company’s operating partnership as part of an umbrella limited partnership C-corporation (Up-C) structure (collectively with the other transactions contemplated by the Business Combination Agreement, the “Business Combination”).

At the Special Meeting, our stockholders will be asked to consider and vote upon a proposal to adopt the Business Combination Agreement and to approve the Business Combination (the “Business Combination Proposal”).

Pursuant to the Business Combination Agreement, subject to certain conditions set forth therein, in connection with the Closing:

(i) the Company will acquire newly-issued common units of PWP OpCo in exchange for cash in an amount equal to the outstanding excess cash balances of the Company (including the proceeds from the PIPE Investment (as defined below)) as of Closing net of redemptions elected by the Company’s public stockholders pursuant to their redemption rights described below and net of transaction costs of the Company (such aggregate outstanding cash balances, “Company Cash”), with the number of such interests to be issued to be calculated based on the formula set forth on Schedule C to the Business Combination Agreement;

(ii) Professional Partners will contribute the equity interests of PWP GP, the general partner of PWP OpCo, to the Company;

(iii) the Company will issue to PWP OpCo, which will distribute (A) to Professional Partners, new shares of Class B-1 common stock, which will have 10 votes per share (for so long as Professional

 

i


Table of Contents

Partners or its limited partners as of the Closing maintain direct or indirect ownership of at least 10% of the issued and outstanding Class A partnership units of PWP OpCo, at which point such Class B-1 common stock shall have one vote per share) and (B) to certain existing investor limited partners of PWP OpCo (“ILPs”), new shares of Class B-2 common stock, which will have one vote per share, with the number of shares of such common stock to be issued to equal the number of common units of PWP OpCo that will be held by Professional Partners and ILPs, respectively, following the Closing (together, the “Stock Consideration”), but prior to redemption of certain electing ILPs and certain former limited partners of Professional Partners (“Legacy Partners”); and

(iv) the Company will repay certain indebtedness of PWP OpCo and its subsidiaries, and pay certain expenses, and PWP OpCo will, subject to the availability of transaction proceeds and retaining a reasonable amount of balance sheet cash, first redeem PWP OpCo units held by certain electing ILPs, and second, redeem PWP OpCo units held by certain electing Legacy Partners and retain any remaining proceeds for general corporate purposes.

Each of the parties to the Business Combination Agreement have made representations, warranties and covenants therein that the parties thereto believe are customary for transactions of this nature. The representations and warranties will not survive the Closing.

On December 29, 2020, concurrently with the execution of the Business Combination Agreement, the Company also entered into subscription agreements (each, a “Subscription Agreement”) with certain investors (collectively, the “PIPE Investors”) pursuant to, and on the terms and subject to the conditions of, which the PIPE Investors have collectively subscribed for 12,500,000 shares of the Company’s Class A common stock for an aggregate purchase price equal to $125 million (the “PIPE Investment”), including $1.5 million subscribed by entities related to the Sponsor, which may be increased by up to $23.5 million (collectively, together with their permitted transferees, the “Sponsor Related PIPE Investors”), for which they will receive a minimum of 150,000 and a maximum of 2.5 million shares of our Class A common stock. The PIPE Investment will be consummated concurrently with the Closing.

At the Closing, the Company will enter into a Tax Receivable Agreement with PWP OpCo, Professional Partners and certain other persons party thereto (the “Tax Receivable Agreement”). The Tax Receivable Agreement will generally provide for payment by the Company to ILPs and certain Partners (as defined therein) of 85% of the cash tax savings, if any, in U.S. federal, state, local and foreign income taxes and related interest realized (or deemed realized) in periods after the Closing as a result of (a) exchanges of interests in PWP OpCo for cash or stock of the Company and certain other transactions and (b) payments made under the Tax Receivable Agreement. The Company expects to retain the benefit of the remaining 15% of these cash tax savings. For additional information, see “Proposal No. 1—The Business Combination Proposal—Related Agreements—Tax Receivable Agreement” in the accompanying proxy statement.

In connection with the Business Combination, certain other related agreements have been, or will be entered into on or prior to the Closing, including the Amended and Restated Registration Rights Agreement, the Stockholders Agreement and the Sponsor Share Surrender and Share Restriction Agreement, in each case, as defined in the accompanying proxy statement. For additional information, see “Proposal No. 1—The Business Combination Proposal—Related Agreements” in the accompanying proxy statement.

In addition, at the Special Meeting, our stockholders will be asked to consider and vote upon: (1) a proposal to approve, for purposes of complying with (i) Nasdaq Listing Rules 5635(a) and (b), the issuance of more than 20% of our issued and outstanding common stock and the resulting change of control in connection with the Business Combination; and (ii) Nasdaq Listing Rule 5635(d), the issuance of 12,500,000 shares of common stock at the Closing in connection with the PIPE

 

ii


Table of Contents

Investment, subject to an increase to up to 14,850,000 shares (the “Nasdaq Proposal”); (2) the proposed amendment and restatement of our certificate of incorporation (subject to the terms and provisions of the Stockholders Agreement) to, among other things, (i) create an additional class of directors so that there will be three classes of directors with staggered terms of office, and make certain related changes (the “Charter Classified Board Proposal”), (ii) provide that certain transactions are not “corporate opportunities” and that the partners, principals, directors, officers, members, managers, employees, consultants, independent contractors and/or other service providers of Professional Partners or any of its subsidiaries, Perella Weinberg Partners LLC or any of its subsidiaries, FinTech Investor Holdings IV, LLC, FinTech Masala Advisors, LLC or any of their respective affiliates (excluding the Company or any of its subsidiaries) (collectively, the “Ownership Group”) are not subject to the doctrine of corporate opportunity, in each case, to the fullest extent permitted by law (the “Charter Corporate Opportunity Proposal”), (iii) increase the number of authorized shares of our capital stock (the “Authorized Capital Stock Proposal”); (iv) create additional classes of our common stock to be designated as Class B-1 common stock, having 10 votes per share, and Class B-2 common stock, having 1 vote per share (the “Class B Stock Proposal”), and (v) provide for additional amendments and restatements generally, in the form of the “Parent A&R Charter” attached as part of the Business Combination Agreement and included in the accompanying proxy as Annex B, principally including changing our name from “FinTech Acquisition Corp. IV” to “Perella Weinberg Partners,” and removing provisions applicable to special purpose acquisition companies (the “Charter Additional Amendments Proposal” and, collectively with the other items in this clause (2), the “Charter Proposals”), (3) electing three directors to serve on our board of directors, in accordance with our Amended and Restated Certificate of Incorporation (the “Existing Certificate of Incorporation”), until the earliest of (i) the Closing, (ii) the 2022 annual meeting of stockholders, and (iii) until their respective successors are duly elected and qualified or until their earlier resignation, removal or death (the “Existing Director Election Proposal”); (4) electing, effective as of, and contingent upon, the Closing, three Class I directors, three Class II directors, and three Class III directors, to serve on our board of directors, in accordance with the proposed to-be-adopted Second Amended and Restated Certificate of Incorporation (the “New Certificate of Incorporation”) until the 2022, 2023 and 2024 annual meetings of stockholders, respectively, and until their respective successors are duly elected and qualified or until their earlier resignation, removal or death (the “Business Combination Director Election Proposal”); (5) a proposal to approve the Perella Weinberg Partners 2021 Omnibus Incentive Plan, attached to the accompanying proxy statement as Annex H (the “Incentive Plan”), including the authorization of the initial share reserve under the Incentive Plan; (the “Incentive Plan Proposal”); (6) a proposal to approve the French sub-plan under the Incentive Plan, attached to the accompanying proxy statement as Annex I (the “French Sub-Plan”) (the “French Sub-Plan Proposal” and, collectively with the Incentive Plan Proposal, the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposals and the Business Combination Director Election Proposal, the “Condition Precedent Proposals”); and (7) a proposal to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event there are insufficient votes for, or for any other reason in connection with, the approval of one or more of the other proposals at the Special Meeting (the “Adjournment Proposal”). The Business Combination is conditioned on the approval of each of the Condition Precedent Proposals at the Special Meeting. Each of the Condition Precedent Proposals is cross-conditioned on the approval of each other. Neither the Existing Director Election Proposal nor the Adjournment Proposal is conditioned upon the approval of any other proposal. Each of these proposals is more fully described in the accompanying proxy statement, which each stockholder is encouraged to read carefully and in its entirety.

Our publicly-traded Class A common stock, units and warrants are currently listed on the Nasdaq under the symbols “FTIV,” “FTIVU” and “FTIVW,” respectively. We intend to apply to continue the listing of our Class A common stock and warrants on the Nasdaq under the symbols “PWP” and “PWPPW,” respectively, upon the Closing, though such securities may not be listed, for instance, if there is not a sufficient number of round lot holders.

 

iii


Table of Contents

Pursuant to the Existing Certificate of Incorporation, a holder of our public shares (a “public stockholder”) may request that we redeem all or a portion of such public stockholder’s public shares for cash if the Business Combination is consummated. Holders of our units must elect to separate the units into the underlying public shares and warrants prior to exercising redemption rights with respect to the public shares. If holders hold their units through a broker, bank or other nominee, holders must notify their broker, bank or other nominee that they elect to separate the units into the underlying public shares and warrants, or if a holder holds units registered in its own name, the holder must contact Continental Stock Transfer & Trust Company, our transfer agent, directly and instruct it to do so. Public stockholders may elect to redeem their public shares even if they vote “FOR” the Business Combination Proposal or any other proposal. If the Business Combination is not consummated, the public shares will be returned to the respective public stockholder, broker, bank or other nominee. If the Business Combination is consummated, and if a public stockholder properly exercises its right to redeem all or a portion of the public shares that it holds, including by timely delivering its shares to our transfer agent, we will redeem such public shares for a per share price, payable in cash, equal to the pro rata portion of the trust account established at the consummation of our initial public offering (the “trust account”), calculated as of two business days prior to the consummation of the Business Combination, including interest (net of taxes payable). For illustrative purposes, as of December 31, 2020, this would have amounted to approximately $10.00 per outstanding public share. If a public stockholder properly exercises its redemption rights in full, then it will be electing to exchange all of its public shares for cash and will not own any public shares of the post-business combination company. See “Special Meeting of FTIV Stockholders—Redemption Rights” in the accompanying proxy statement for a detailed description of the procedures to be followed if you wish to redeem your public shares for cash. Holders of our outstanding warrants do not have redemption rights in connection with the Business Combination. Unless otherwise specified, the information in the accompanying proxy statement assumes that none of our public stockholders exercises their redemption rights with respect to their shares of Class A common stock.

Notwithstanding the foregoing, a public stockholder, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its public shares with respect to more than an aggregate of 15% of the public shares. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the public shares, then any such shares in excess of that 15% limit would not be redeemed for cash. In addition, pursuant to the Existing Certificate of Incorporation, in no event will we redeem public shares in an amount that would cause our net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) to be less than $5,000,001. In such case, we would not proceed with the redemption of our public shares and the Business Combination, and instead may search for an alternate initial business combination.

The Closing is subject to the satisfaction or waiver of certain closing conditions set forth in the Business Combination Agreement and as described in the accompanying proxy statement. These conditions to closing in the Business Combination Agreement are for the sole benefit of the parties thereto and may be waived by such parties. There can be no assurance that the parties to the Business Combination Agreement would satisfy or waive any such provision of the Business Combination Agreement. PWP has obtained all required governance votes and all required constituent consents necessary to effect the Closing.

The Sponsor has agreed to, among other things, vote in favor of the Business Combination Proposal and the other proposals to be voted upon at the Special Meeting, and to waive its redemption rights in connection with the consummation of the Business Combination with respect to any shares of our common stock held by them. Our shares of pre-transaction Class B common stock will be excluded from the pro rata calculation used to determine the per share redemption price. As of the date of the accompanying proxy statement, the Sponsor owns an aggregate of approximately 26.9% of our outstanding shares of common stock.

 

iv


Table of Contents

We are providing the accompanying proxy statement and accompanying proxy card to our stockholders in connection with the solicitation of proxies to be voted at the Special Meeting and at any adjournments or postponements of the Special Meeting. Information about the Special Meeting, the Business Combination and other related business to be considered by the Company’s stockholders at the Special Meeting is included in the accompanying proxy statement. Whether or not you plan to attend the Special Meeting, all of our stockholders are urged to read the accompanying proxy statement, including the Annexes and the accompanying financial statements of the Company and PWP OpCo, carefully and in its entirety. In particular, you should also carefully consider the risk factors described in “Risk Factors” beginning on page 56 of the accompanying proxy statement.

After careful consideration, our board of directors has unanimously approved the Business Combination Agreement and the Business Combination, and unanimously recommends that our stockholders vote “FOR” adoption of the Business Combination Agreement and approval of the Business Combination, and “FOR” all other proposals presented to our stockholders in the accompanying proxy statement. When you consider our board of directors’ recommendation of these proposals, you should keep in mind that our directors have interests in the Business Combination that may conflict with your interests as a stockholder. See the section entitled “Certain Relationships and Related Persons Transactions” for additional information.

The approval of each of the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal requires the affirmative vote of holders of a majority of the shares present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting. The Nasdaq Proposal requires the affirmative vote of holders of a majority of the votes cast by holders of our outstanding shares of common stock present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting. The approval of each of the Business Combination Proposal and the Charter Proposals requires the affirmative vote of holders of a majority of our outstanding shares of common stock entitled to vote thereon at the Special Meeting. To be elected as a director as described in the Existing Director Election Proposal or the Business Combination Director Election Proposal, a nominee must receive a plurality of all the votes of the shares present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting, which means that the nominees who receive the most votes are elected.

Your vote is very important. Whether or not you plan to attend the Special Meeting, please vote as soon as possible by following the instructions in the accompanying proxy statement to make sure that your shares are represented at the Special Meeting. If you hold your shares in “street name” through a broker, bank or other nominee, you will need to follow the instructions provided to you by your broker, bank or other nominee to ensure that your shares are represented and voted at the Special Meeting. The Business Combination is conditioned on the approval of each of the Condition Precedent Proposals at the Special Meeting. Each of the Condition Precedent Proposals is cross-conditioned on the approval of each other. Neither the Existing Director Election Proposal nor the Adjournment Proposal is conditioned upon the approval of any other proposal. Each of the proposals is more fully described in the accompanying proxy statement, which each stockholder is encouraged to read carefully and in its entirety.

If you sign and return your proxy card without indicating how you wish to vote, your proxy will be voted “FOR” each of the proposals presented at the Special Meeting. If you fail to return your proxy card or fail to instruct your broker, bank or other nominee how to vote, and do not attend the Special Meeting in person virtually, the effect will be, among other things, that your shares will not be counted for purposes of determining whether a quorum is present at the Special Meeting and will not be voted.

 

v


Table of Contents

An abstention will be counted towards the quorum requirement for each of the proposals presented at the Special Meeting but a broker non-vote will not. In connection with (i) the Nasdaq Proposal, the Existing Director Election Proposal and the Business Combination Director Election Proposal, abstentions and broker non-votes will have no effect on the vote for each proposal; (ii) the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal, abstentions will be counted as present and entitled to vote at the Special Meeting and will have the same effect as voting “AGAINST” the proposal but broker non-votes will have no effect on the vote for each proposal and (iii) the Business Combination Proposal and the Charter Proposals, abstentions and broker non-votes will have the same effect as voting “AGAINST” the proposal. If you are a stockholder of record and you attend the Special Meeting and wish to vote in person virtually, you may withdraw your proxy and vote in person virtually.

TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST DEMAND IN WRITING THAT YOUR PUBLIC SHARES ARE REDEEMED FOR A PRO RATA PORTION OF THE FUNDS HELD IN THE TRUST ACCOUNT AND TENDER YOUR SHARES TO OUR TRANSFER AGENT AT LEAST TWO BUSINESS DAYS BEFORE THE SCHEDULED DATE OF THE SPECIAL MEETING. YOU MAY TENDER YOUR SHARES BY EITHER DELIVERING YOUR STOCK CERTIFICATE TO THE TRANSFER AGENT OR BY DELIVERING YOUR SHARES ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT WITHDRAWAL AT CUSTODIAN) SYSTEM. IF THE BUSINESS COMBINATION IS NOT COMPLETED, THEN THESE SHARES WILL BE RETURNED TO YOU OR YOUR ACCOUNT. IF YOU HOLD THE SHARES IN “STREET NAME,” YOU WILL NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BROKER, BANK OR OTHER NOMINEE TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS.

On behalf of our board of directors, I would like to thank you for your support and look forward to the successful completion of the Business Combination.

 

Sincerely,

 

/s/ Daniel G. Cohen

Daniel G. Cohen

Chief Executive Officer

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THE ACCOMPANYING PROXY STATEMENT. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.

The accompanying proxy statement is dated                , 2021 and is expected to be first mailed to our stockholders on or about                , 2021.

 

vi


Table of Contents

NOTICE OF SPECIAL MEETING IN LIEU OF 2021 ANNUAL MEETING

OF STOCKHOLDERS OF FINTECH ACQUISITION CORP. IV

TO BE HELD                , 2021

To the Stockholders of FinTech Acquisition Corp. IV:

NOTICE IS HEREBY GIVEN that a special meeting (the “Special Meeting”) of the stockholders of FinTech Acquisition Corp. IV, a Delaware corporation (“we,” “us,” “our” or the “Company”), will be held virtually on                , 2021 at                Eastern Time, accessible at www.cstproxy.com/fintechacquisitioncorpiv/sm2021. You are cordially invited to attend the Special Meeting to conduct the following items of business:

 

   

Proposal No. 1—The Business Combination Proposal—To consider and vote upon a proposal to approve and adopt the Business Combination Agreement, dated as of December 29, 2020 (the “Business Combination Agreement”), by and among the Company, FinTech Investor Holdings IV, LLC, a Delaware limited liability company, Fintech Masala Advisors, LLC, a Delaware limited liability company (together with FinTech Investor Holdings IV, LLC, “Sponsor”), PWP Holdings LP, a Delaware limited partnership (“PWP OpCo”), PWP GP LLC, a Delaware limited liability company and the general partner of PWP OpCo (“PWP GP”), PWP Professional Partners LP, a Delaware limited partnership and a limited partner of PWP OpCo (“Professional Partners”), and Perella Weinberg Partners LLC, a Delaware limited liability company and the general partner of Professional Partners (“Professionals GP”), a copy of which is attached to this proxy statement as Annex A, and approve the transactions contemplated thereby, pursuant to which, among other things, (i) FTIV will acquire certain partnership interests in PWP OpCo, (ii) PWP OpCo will become jointly-owned by the Company, Professional Partners, and certain existing partners of PWP OpCo, and (iii) PWP OpCo will, following the Closing, serve as the Company’s operating partnership as part of an umbrella limited partnership C-corporation (Up-C) structure (collectively with the other transactions contemplated by the Business Combination Agreement, the “Business Combination”) (the “Business Combination Proposal”);

 

   

Proposal No. 2—The Nasdaq Proposal—To consider and vote upon a proposal to approve, (i) for purposes of complying with Nasdaq Listing Rules 5635(a) and (b), the issuance of more than 20% of our issued and outstanding common stock and the resulting change of control in connection with the Business Combination; and (ii) for purposes of complying with Nasdaq Listing Rule 5635(d), the issuance of 12,500,000 shares of common stock in connection with the PIPE Investment, subject to an increase to up to 14,850,000 shares, upon the completion of the Business Combination; (the “Nasdaq Proposal”);

 

   

Charter Proposals—To consider and vote upon the following five separate proposals relating to the proposed amendment and restatement of our Amended and Restated Certificate, which, if approved, would take effect upon the Closing:

 

   

Proposal No. 3—The Charter Classified Board Proposal—To consider and vote upon proposed amendments to our Amended and Restated Certificate of Incorporation (the “Existing Certificate of Incorporation”) to create an additional class of directors so that there will be three classes of directors with staggered terms of office, and make certain related changes (the “Charter Classified Board Proposal”);

 

   

Proposal No. 4—The Charter Corporate Opportunity Proposal—To consider and vote upon proposed amendments to our Existing Certificate of Incorporation to provide that certain transactions are not “corporate opportunities” and that the Ownership Group and their affiliates are not subject to the doctrine of corporate opportunity, in each case, to the fullest extent permitted by law (the “Charter Corporate Opportunity Proposal”);


Table of Contents
   

Proposal No. 5—The Authorized Capital Stock Proposal—To consider and vote upon proposed amendments to our Existing Certificate of Incorporation to increase the number of authorized shares of our capital stock (the “Authorized Capital Stock Proposal”);

 

   

Proposal No. 6—The Class B Stock Proposal—To consider and vote upon proposed amendments to our Existing Certificate of Incorporation to create additional classes of our common stock to be designated as Class B-1 common stock, having 10 votes per share, and Class B-2 common stock, having 1 vote per share (the “Class B Stock Proposal”);

 

   

Proposal No. 7—The Charter Additional Amendments Proposal—To consider and vote upon proposed amendments to our Existing Certificate of Incorporation to provide for additional changes, principally including changing our name from “FinTech Acquisition Corp. IV” to “Perella Weinberg Partners” and removing provisions applicable to special purpose acquisition companies (the “Charter Additional Amendments Proposal” and together with the Charter Classified Board Proposal, the Charter Corporate Opportunity Proposal, the Authorized Capital Stock Proposal and the Class B Stock Proposal, the “Charter Proposals”);

 

   

Proposal No. 8—The Existing Director Election Proposal—To consider and vote upon a proposal to elect Betsy Z. Cohen, Brittain Ezzes and Madelyn Antoncic as directors to serve on our board of directors as Class I directors under our Existing Certificate of Incorporation until the earlier of the Closing and the 2022 annual meeting of stockholders, and until their respective successors are duly elected and qualified or until their earlier resignation, removal or death (the “Existing Director Election Proposal”);

 

   

Proposal No. 9—The Business Combination Director Election Proposal—To consider and vote upon a proposal to elect three Class I directors, three Class II directors, and three Class III directors to serve, effective as of, and contingent upon, the Closing, on our board of directors until the 2022, 2023 and 2024 annual meetings of stockholders, respectively, and until their respective successors are duly elected and qualified, or until their earlier resignation, removal or death (the “Business Combination Director Election Proposal”);

 

   

Proposal No. 10—The Incentive Plan Proposal—To consider and vote upon a proposal to approve the Perella Weinberg Partners 2021 Omnibus Incentive Plan (the “Incentive Plan”), including the authorization of the initial share reserve under the Incentive Plan (the “Incentive Plan Proposal”);

 

   

Proposal No. 11—The French Sub-Plan Proposal—To consider and vote upon a proposal to approve the French Sub-Plan under the Incentive Plan (the “French Sub-Plan Proposal”); and

 

   

Proposal No. 12—The Adjournment Proposal—To consider and vote upon a proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or for any other reason in connection with, the approval of one or more of the other proposals at the Special Meeting (the “Adjournment Proposal”).

The Business Combination is conditioned on the approval of each of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposals, the Business Combination Director Election Proposal, the Incentive Plan Proposal and the French Sub-Plan Proposal, which we refer to collectively as the “Condition Precedent Proposals,” at the Special Meeting. The Condition Precedent Proposals are cross-conditioned on the approval of each other. Neither the Existing Director Election Proposal nor the Adjournment Proposal is conditioned upon the approval of any other proposal. Each of these proposals is more fully described in this proxy statement, which each stockholder is encouraged to read carefully and in its entirety.

 

ii


Table of Contents

The record date for the Special Meeting is                , 2021. Only stockholders of record at the close of business on that date may vote at the Special Meeting or any adjournment thereof. A complete list of our stockholders of record entitled to vote at the Special Meeting will be available for ten days before the Special Meeting at our principal executive office for inspection by stockholders during ordinary business hours for any purpose germane to the Special Meeting.

Pursuant to the Existing Certificate of Incorporation, a holder of our public shares (a “public stockholder”) may request that we redeem all or a portion of such stockholder’s public shares for cash if the Business Combination is consummated. Holders of our units must elect to separate the units into the underlying public shares and warrants prior to exercising redemption rights with respect to the public shares. If holders hold their units through a broker, bank or other nominee, holders must notify their broker, bank or other nominee that they elect to separate the units into the underlying public shares and warrants, or if a holder holds units registered in its own name, the holder must contact Continental Stock Transfer & Trust Company, our transfer agent, directly and instruct it to do so. Public stockholders may elect to redeem their public shares even if they vote “for” the Business Combination Proposal or any other proposal. If the Business Combination is not consummated, the public shares will be returned to the respective public stockholder, broker, bank or other nominee. If the Business Combination is consummated, and if a public stockholder properly exercises its right to redeem all or a portion of the public shares that it holds, including by timely delivering its shares to our transfer agent, we will redeem such public shares for a per share price, payable in cash, equal to the pro rata portion of the trust account established at the consummation of our initial public offering (the “trust account”), calculated as of two business days prior to the consummation of the Business Combination, including interest (net of taxes payable). For illustrative purposes, as of December 31, 2020, this would have amounted to approximately $10.00 per outstanding public share. If a public stockholder properly exercises its redemption rights in full, then it will be electing to exchange all of its public shares for cash and will not own any public shares of the post-business combination company. See “Special Meeting of FTIV Stockholders—Redemption Rights” in this proxy statement for a detailed description of the procedures to be followed if you wish to redeem your public shares for cash. Holders of our outstanding warrants do not have redemption rights in connection with the Business Combination. Unless otherwise specified, the information in this proxy statement assumes that none of our public stockholders exercises their redemption rights with respect to their shares of Class A common stock.

Notwithstanding the foregoing, a public stockholder, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its public shares with respect to more than an aggregate of 15% of the public shares. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the public shares, then any such shares in excess of that 15% limit would not be redeemed for cash. In addition, pursuant to the Existing Certificate of Incorporation, in no event will we redeem public shares in an amount that would cause our net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) to be less than $5,000,001. In such case, we would not proceed with the redemption of our public shares and the Business Combination, and instead may search for an alternate initial business combination.

The Sponsor has agreed to, among other things, vote in favor of the Business Combination Proposal and the other proposals described herein to be voted upon at the Special Meeting, and to waive its redemption rights in connection with the consummation of the Business Combination with respect to any shares of our common stock held by them. Our shares of pre-transaction Class B common stock will be excluded from the pro rata calculation used to determine the per share redemption price. As of the date of this proxy statement, the Sponsor owns an aggregate of 26.9% of our outstanding shares of common stock.

 

iii


Table of Contents

Concurrently with the execution of the Business Combination Agreement, we entered into subscription agreements (each, a “Subscription Agreement”) with certain investors (collectively, the “PIPE Investors”) pursuant to, and on the terms and subject to the conditions of, which the PIPE Investors have collectively subscribed for 12,500,000 shares of our Class A common stock for an aggregate purchase price equal to $125 million, including $1.5 million subscribed by entities related to the Sponsor, which may be increased by up to $23.5 million (collectively, together with their permitted transferees, the “Sponsor Related PIPE Investors”), for which they will receive a minimum of 150,000 and a maximum of 2.5 million shares of our Class A common stock. The PIPE Investment will be consummated concurrently with the Closing. Each of the holders of our pre-transaction Class B common stock has agreed to waive the anti-dilution adjustments provided for in the Existing Certificate of Incorporation applicable to our pre-transaction Class B common stock in connection with the Business Combination, including the PIPE Investment. As a result of such waiver, after giving effect to the surrender by the Sponsor, without consideration therefor, of 1,023,333 shares of our Class B common stock, the remaining 6,846,667 shares of our pre-transaction Class B common stock will automatically convert into shares of Class A common stock on a one-for-one basis upon the consummation of the Business Combination.

The approval of each of the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal requires the affirmative vote of holders of a majority of the shares present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting. The Nasdaq Proposal requires the affirmative vote of holders of a majority of the votes cast by holders of our outstanding shares of common stock present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting. The approval of each of the Business Combination Proposal and the Charter Proposals requires the affirmative vote of holders of a majority of our outstanding shares of common stock entitled to vote thereon at the Special Meeting. To be elected as a director as described in the Existing Director Election Proposal or the Business Combination Director Election Proposal, a nominee must receive a plurality of all the votes of the shares present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting, which means that the nominees who receive the most votes are elected.

Your vote is very important. Whether or not you plan to attend the Special Meeting, please vote as soon as possible by following the instructions in this proxy statement to make sure that your shares are represented at the Special Meeting. If you hold your shares in “street name” through a broker, bank or other nominee, you will need to follow the instructions provided to you by your broker, bank or other nominee to ensure that your shares are represented and voted at the Special Meeting. The Business Combination is conditioned on the approval of each of the Condition Precedent Proposals at the Special Meeting. Each of the Condition Precedent Proposals is cross-conditioned on the approval of each other. Neither the Existing Director Election Proposal nor the Adjournment Proposal is conditioned upon the approval of any other proposal. Each of these proposals is more fully described in this proxy statement, which each stockholder is encouraged to read carefully and in its entirety.

If you sign and return your proxy card without indicating how you wish to vote, your proxy will be voted “FOR” each of the proposals presented at the Special Meeting. If you fail to return your proxy card or fail to instruct your broker, bank or other nominee how to vote, and do not attend the Special Meeting in person virtually, the effect will be, among other things, that your shares will not be counted for purposes of determining whether a quorum is present at the Special Meeting and will not be voted. An abstention will be counted towards the quorum requirement for each of the proposals presented at the Special Meeting but a broker non-vote will not. Notwithstanding the foregoing, in connection with (i) the Nasdaq Proposal, the Existing Director Election Proposal and the Business Combination Director Election Proposal, abstentions and broker non-votes will have no effect on the vote for each proposal; (ii) the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal, abstentions will be counted as present and entitled to vote at the Special Meeting and will

 

iv


Table of Contents

have the same effect as voting “AGAINST” the proposal but broker non-votes will have no effect on the vote for each proposal, and (iii) the Business Combination Proposal and Charter Proposals, abstentions and broker non-votes will have the same effect as voting “AGAINST” the proposal. If you are a stockholder of record and you attend the Special Meeting and wish to vote in person virtually, you may withdraw your proxy and vote in person virtually.

All Company stockholders are cordially invited to participate in the virtual Special Meeting by accessing www.cstproxy.com/fintechacquisitioncorpiv/sm2021. To ensure your representation at the Special Meeting, however, we urge you to complete, sign, date and return the enclosed proxy card as soon as possible. If you are a stockholder of record, you may also cast your vote online during the virtual Special Meeting. If you sign, date and return your proxy card without indicating how you wish to vote, your proxy will be voted “FOR” each of the proposals presented at the Special Meeting. If your shares are held in an account at a brokerage firm or bank, you must instruct your broker or bank on how to vote your shares or, if you wish to participate in the virtual Special Meeting and vote online during the Special Meeting, obtain a proxy from your broker or bank and e-mail a copy (a legible photograph is sufficient) of your legal proxy to proxy@continentalstock.com. Public stockholders may elect to redeem their public shares even if they vote “FOR” the Business Combination Proposal.

Your attention is directed to the remainder of this proxy statement following this notice (including the Annexes and other documents referred to herein) for a more complete description of the Business Combination and related transactions and each of the proposals. You are encouraged to read this proxy statement carefully and in its entirety, including the Annexes and other documents referred to herein. If you have any questions or need assistance voting your shares, please contact Morrow Sodali LLC (“Morrow”), our proxy solicitor, by calling (800) 662-5200 or banks and brokers can call collect at (203) 658-9400, or by emailing FTIV.info@investor.morrowsodali.com.

This proxy statement is first being furnished to our stockholders on or about                , 2021.

 

By Order of the Board of Directors

 

/s/ Daniel G. Cohen

Daniel G. Cohen
Chief Executive Officer

Philadelphia, Pennsylvania

                , 2021

 

v


Table of Contents

TABLE OF CONTENTS

 

     Page  

MARKET, RANKING AND OTHER INDUSTRY DATA

     1  

TRADEMARKS, SERVICE MARKS AND TRADE NAMES

     1  

SELECTED DEFINITIONS

     2  

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

     4  

SUMMARY TERM SHEET

     7  

QUESTIONS AND ANSWERS ABOUT THE PROPOSALS FOR OUR STOCKHOLDERS AND THE SPECIAL MEETING

     16  

SUMMARY OF THE PROXY STATEMENT

     35  

SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION OF FTIV

     46  

SELECTED HISTORICAL FINANCIAL AND OTHER INFORMATION OF PWP

     47  

SELECTED UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

     54  

COMPARATIVE PER SHARE INFORMATION

     55  

RISK FACTORS

     56  

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

     104  

SPECIAL MEETING OF FTIV STOCKHOLDERS

     117  

PROPOSAL NO. 1—THE BUSINESS COMBINATION PROPOSAL

     123  

PROPOSAL NO. 2—THE NASDAQ PROPOSAL

     170  

PROPOSAL NO. 3—THE CHARTER CLASSIFIED BOARD PROPOSAL

     172  

PROPOSAL NO. 4—THE CHARTER CORPORATE OPPORTUNITY PROPOSAL

     174  

PROPOSAL NO. 5—THE AUTHORIZED CAPITAL STOCK PROPOSAL

     179  

PROPOSAL NO. 6—THE CLASS B STOCK PROPOSAL

     181  

PROPOSAL NO. 7—THE CHARTER ADDITIONAL AMENDMENTS PROPOSAL

     184  

PROPOSAL NO. 8—THE EXISTING DIRECTOR ELECTION PROPOSAL

     188  

PROPOSAL NO. 9—THE BUSINESS COMBINATION DIRECTOR ELECTION PROPOSAL

     189  

PROPOSAL NO. 10—THE INCENTIVE PLAN PROPOSAL

     190  

PROPOSAL NO. 11—THE FRENCH SUB-PLAN PROPOSAL

     199  

PROPOSAL NO. 12—THE ADJOURNMENT PROPOSAL

     203  

INFORMATION ABOUT FTIV

     204  

FTIV MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     216  

INFORMATION ABOUT PWP

     222  

PWP MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     240  

EXECUTIVE COMPENSATION

     259  

MANAGEMENT AFTER THE BUSINESS COMBINATION

     268  

DESCRIPTION OF SECURITIES POST-BUSINESS COMBINATION

     275  

SECURITIES ACT RESTRICTIONS ON RESALE OF SECURITIES

     282  

BENEFICIAL OWNERSHIP OF SECURITIES PRE- AND POST-BUSINESS COMBINATION

     284  

CERTAIN RELATIONSHIPS AND RELATED PERSONS TRANSACTIONS

     290  

MARKET PRICE INFORMATION

     297  

APPRAISAL RIGHTS

     298  

DELIVERY OF DOCUMENTS TO STOCKHOLDERS

     298  

TRANSFER AGENT AND REGISTRAR

     298  

SUBMISSION OF STOCKHOLDER PROPOSALS

     298  

FUTURE STOCKHOLDER PROPOSALS

     298  

WHERE YOU CAN FIND MORE INFORMATION

     298  

INDEX TO CONSOLIDATED FINANCIAL INFORMATION

  


Table of Contents

ANNEXES

 

Annex A    Business Combination Agreement
Annex B    Form of Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation
Annex C    Form of Perella Weinberg Partners’ Amended and Restated Bylaws
Annex D    Form of Amended and Restated Registration Rights Agreement
Annex E    Form of Stockholders Agreement
Annex F    Form of PWP OpCo Amended and Restated Limited Partnership Agreement
Annex G    Form of Tax Receivable Agreement
Annex H    Form of Perella Weinberg Partners 2021 Omnibus Incentive Plan
Annex I    Form of French Sub-Plan Under the Perella Weinberg Partners 2021 Omnibus Incentive Plan
Annex J    Sponsor Share Surrender and Share Restriction Agreement
Annex K    Amendment to Sponsor Share Surrender and Share Restriction Agreement


Table of Contents

MARKET, RANKING AND OTHER INDUSTRY DATA

Certain market, ranking and industry data included in this proxy statement, including the size of certain markets and PWP’s (as defined below) size or position and the positions of PWP’s competitors within these markets, including its products and services relative to its competitors, are based on estimates by PWP’s management. These estimates have been derived from PWP’s management’s knowledge and experience in the markets in which PWP operates, as well as information based on research, industry and general publications, including surveys and studies conducted by third parties. Industry publications, surveys and studies generally state that they have been obtained from sources believed to be reliable.

We are responsible for all of the disclosure in this proxy statement and while we believe the data from these sources to be accurate and complete, neither we nor PWP have independently verified all data from these sources or obtained third-party verification of market share data and this information may not be reliable. In addition, these sources may use different definitions of the relevant markets. Data regarding PWP’s industry is intended to provide general guidance, but is inherently imprecise. Market share data is subject to change and cannot always be verified with certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey of market shares. In addition, customer preferences can and do change. As a result, you should be aware that market share, ranking and other similar data set forth herein, and estimates and beliefs based on such data, may not be reliable. References herein to PWP being a leader in a market or product category refers to PWP’s belief that it has a leading market share, expertise or thought leadership position in each specified market, unless the context otherwise requires. In addition, the discussion herein regarding PWP’s various markets is based on how PWP defines the markets for its products or services, which products or services may be either part of larger overall markets or markets that include other types of products and services.

Assumptions and estimates by PWP’s current and PWP’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in “Risk factors—Risks Related to the Business of PWP.” These and other factors could cause our future performance to differ materially from our assumptions and estimates. See “Cautionary Note Regarding Forward-Looking Statements.

In this proxy statement, PWP uses the term “independent advisory firms” to refer to independent investment banks that offer advisory services. PWP considers the independent advisory firms to be its publicly traded peers, Evercore Partners Inc.; Greenhill & Co., Inc.; Houlihan Lokey, Inc.; Lazard Ltd; Moelis & Company; PJT Partners, Inc.; and PWP, as well as its non-publicly traded peers, Centerview Partners; Guggenheim Partners; and NM Rothschild & Sons Limited. The mergers and acquisitions (“M&A”) market data for announced and completed transactions and estimated fee data referenced throughout this proxy statement were obtained from Dealogic, LLC.

TRADEMARKS, SERVICE MARKS AND TRADE NAMES

This proxy statement may contain some trademarks, service marks and trade names of PWP or of third parties. Each one of these trademarks, service marks or trade names is either (1) PWP’s registered trademark, (2) a trademark for which PWP has a pending application, or (3) a trade name or service mark for which PWP claims common law rights. All other trademarks, trade names or service marks of any other company appearing in this proxy statement belong to their respective owners. Solely for convenience, the trademarks, service marks and trade names referred to in this proxy statement are presented without the TM, SM and ® symbols, but such references are not intended to indicate, in any way, that we or PWP will not assert, to the fullest extent under applicable law, our respective rights or the rights of the applicable licensors to these trademarks, service marks and trade names.

 

1


Table of Contents

SELECTED DEFINITIONS

Unless otherwise stated in this proxy statement or the context otherwise requires, references to:

 

   

“Business Combination” refers to the transactions contemplated by the Business Combination Agreement.

 

   

“Business Combination Agreement” refers to the Business Combination Agreement, dated as of December 29, 2020, by and among FTIV, the Sponsor, PWP OpCo, PWP GP, Professional Partners and Professionals GP, as it may be amended from time to time.

 

   

“Class A common stock” refers to Class A common stock, par value $0.0001 per share, of FTIV prior to the Business Combination, and of Perella Weinberg Partners immediately following the consummation of the Business Combination.

 

   

“Class B common stock” refers to the Class B common stock, par value $0.0001 per share, of FTIV prior to the Business Combination and, collectively to Class B-1 common stock, par value $0.0001 per share, and Class B-2 common stock, par value $0.0001 per share, of Perella Weinberg Partners immediately following the consummation of the Business Combination.

 

   

“Common Stock” refers to the Class A common stock and the Class B common stock, together.

 

   

“Group LP” refers to Perella Weinberg Partners Group LP, a Delaware limited partnership and a wholly owned subsidiary of PWP OpCo.

 

   

“ILPs” refers to certain existing investor limited partners of PWP OpCo who hold interests in PWP OpCo, alongside Professional Partners.

 

   

“IPO” refers to FTIV’s initial public offering on September 29, 2020 in which it sold 23,000,000 units.

 

   

“Legacy Partners” refers to former working Limited Partners whose tenure was terminated prior to November 1, 2020.

 

   

“Limited Partners” refers to limited partners of Professional Partners.

 

   

“Perella Weinberg Partners” refers to FTIV, immediately following consummation of the Business Combination, at which time FTIV will change its name to Perella Weinberg Partners, a Delaware corporation.

 

   

“Professional Partners” refers to PWP Professional Partners LP, a Delaware limited partnership.

 

   

“PWP” (i) prior to the Business Combination refers to PWP OpCo and its consolidated subsidiaries and (ii) following the consummation of the Business Combination refers to Perella Weinberg Partners and its consolidated subsidiaries.

 

   

“PWP GP” means PWP GP LLC, the general partner of PWP OpCo.

 

   

“PWP OpCo” (i) prior to the PWP Separation, refers to PWP Holdings LP as the holding company for both the advisory business and asset management business of PWP and (ii) following the PWP Separation, refers to PWP Holdings LP as the holding company solely for the advisory business of PWP.

 

   

“PWP Separation” refers to the separation of the advisory business from the asset management business of PWP OpCo pursuant to a master separation agreement, dated as of February 28, 2019.

 

   

“Sponsor” refers collectively to FinTech Investor Holdings IV, LLC, a Delaware limited liability company, and Fintech Masala Advisors, LLC, a Delaware limited liability company.

 

2


Table of Contents
   

“Sponsor Related PIPE Investors” refers to the certain PIPE Investors that subscribed to $1.5 million in the PIPE Investment, which may be increased by up to $23.5 million, and are related to the Sponsor.

 

   

“Working Partners” refers to working Limited Partners whose tenure was not terminated prior to November 1, 2020.

 

3


Table of Contents

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement contains forward-looking statements, which are not historical facts. This includes, without limitation, statements regarding the financial position, business strategy and the plans and objectives of management for future operations, including as they relate to the potential Business Combination, of the Company. These statements constitute projections, forecasts and forward-looking statements, and are not guarantees of performance. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. When used in this proxy statement, words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strive,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. When the Company discusses its strategies or plans, including as they relate to the potential Business Combination, it is making projections, forecasts or forward-looking statements. Such statements are based on the beliefs of, as well as assumptions made by and information currently available to, the Company’s management.

Forward-looking statements in this proxy statement may include, for example, statements about:

 

   

our ability to complete the Business Combination or, if we do not complete the Business Combination, any other initial business combination;

 

   

satisfaction or waiver of the conditions to the Business Combination, including, among others: (a) minimum aggregate outstanding cash balances of the Company (“Company Cash”) of $200,000,000; (b) approval of the Business Combination by the Company’s stockholders; (c) the lack of any Company Material Adverse Effect, Professionals Material Adverse Effect or Parent Material Adverse Effect (each as defined in the Business Combination Agreement) since the date of the Business Combination Agreement; (d) the receipt of certain regulatory approvals (including of the Financial Industry Regulatory Authority (“FINRA”), the Prudential Authority (Autorité de Contrôle Prudentiel et de Résolution) (“ACPR”) and the U.K. Financial Services and Markets Act 2000 (“FSMA”)); (e) a minimum of $5,000,001 of net tangible assets of the Company following the exercise by the Company’s public stockholders of the redemption rights; and/or (f) the consummation of the PIPE Investment;

 

   

the occurrence of any other event, change or other circumstances that could give rise to the termination of the Business Combination Agreement;

 

   

the projected financial information, anticipated growth rate, and market opportunity of PWP;

 

   

the ability to obtain or maintain the listing of Perella Weinberg Partners Class A common stock and warrants on Nasdaq following the Business Combination;

 

   

our public securities’ potential liquidity and trading;

 

   

our ability to consummate the PIPE Investment or raise financing in the future;

 

   

our success in retaining or recruiting partners and other employees, or changes related to, our officers, key employees or directors following the completion of the Business Combination;

 

   

members of our management team allocating their time to other businesses and potentially having conflicts of interest with our business or in approving the Business Combination;

 

   

factors relating to the business, operations and financial performance of PWP, including:

 

   

PWP’s ability to implement the Business Combination, including its ability to obtain all applicable regulatory consents and approvals;

 

4


Table of Contents
   

whether PWP realizes all or any of the anticipated benefits from the Business Combination;

 

   

whether the Business Combination results in any increased or unforeseen costs or has an impact on PWP’s ability to retain or compete for professional talent or investor capital;

 

   

global economic, business, market and geopolitical conditions, including the impact of public health crises, such as the ongoing rapid, worldwide spread of a novel strain of coronavirus and the pandemic caused thereby (collectively, “COVID-19”);

 

   

extensive regulation of the corporate advisory industry and U.S. and foreign regulatory developments relating to, among other things, financial institutions and markets, government oversight, fiscal and tax policy and laws (including the treatment of carried interest);

 

   

the outcome of third-party litigation involving PWP;

 

   

substantial litigation risks in the financial services industry;

 

   

the impact of market conditions and other factors on the ability to consummate, and the valuation of Perella Weinberg Partners in connection with, the Business Combination;

 

   

conditions impacting the corporate advisory industry;

 

   

strong competition from other financial advisory and investment banking firms;

 

   

PWP’s ability to successfully identify, recruit and develop talent;

 

   

PWP’s dependence on and ability to retain Working Partners and other key employees;

 

   

risks associated with strategic transactions, such as joint ventures, strategic investments and acquisitions;

 

   

PWP’s successful formulation and execution of its business and growth strategies;

 

   

PWP’s ability to expand into new markets and lines of businesses for the advisory business;

 

   

PWP’s ability to appropriately manage conflicts of interest and tax and other regulatory factors relevant to the firm’s business, including actual, potential or perceived conflicts of interest and other factors that may damage its business and reputation;

 

   

PWP’s dependence on its fee-paying clients and fluctuating revenues from its non-exclusive, engagement-by-engagement business model;

 

   

the ability of PWP’s clients to pay for its services, including its restructuring clients;

 

   

the high volatility of PWP’s revenue as a result of its reliance on advisory fees that are largely contingent on the completion of events which may be out of its control;

 

   

potential impairment of goodwill and other intangible assets, which represent a significant portion of PWP’s assets;

 

   

exposure to fluctuations in foreign currency exchange rates;

 

   

assumptions relating to PWP’s operations, financial results, financial condition, business prospects, growth strategy and liquidity;

 

   

cybersecurity and other operational risks; and

 

   

other risks and uncertainties described under “Risk Factors.”

These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this proxy statement. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control or the control of PWP) or other assumptions that may cause actual results or performance to be materially

 

5


Table of Contents

different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors.” Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Neither we nor PWP undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Neither we nor PWP undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by applicable law.

Before any FTIV stockholder grants its proxy or instructs how its vote should be cast or votes on the proposals to be put to the Special Meeting, such stockholder should be aware that the occurrence of the events described in the “Risk Factors” section and elsewhere in this proxy statement may adversely affect us.

 

6


Table of Contents

SUMMARY TERM SHEET

This summary term sheet, together with the sections entitled “Questions and Answers About the Proposals and the Special Meeting” and “Summary of the Proxy Statement,” summarizes certain information contained in this proxy statement, but does not contain all of the information that is important to you. You should read this proxy statement, including the attached Annexes and the accompanying financial statements of FTIV and PWP, carefully and in its entirety for a more complete understanding of the matters to be considered at the Special Meeting.

 

   

FinTech Acquisition Corp. IV, a Delaware corporation, is a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

 

   

On September 29, 2020, we consummated the IPO of 23,000,000 units, which includes the full exercise of the underwriters’ overallotment of 3,000,000 units, generating gross proceeds of $230,000,000. Each unit consisted of one share of our Class A common stock and one-third of one warrant where each whole warrant entitles the holder to purchase one share of our common stock. Simultaneously with the closing of the IPO, we consummated the sale of 610,000 placement units at a price of $10.00 per unit in a private placement to the Sponsor, generating gross proceeds of $6,100,000. Each placement unit consists of one placement share and one-third of one placement warrant to purchase one share of our Class A common stock exercisable at $11.50. Each warrant sold in the IPO and the private placement will become exercisable 30 days after the completion of our initial business combination, and will expire at 5:00 p.m., New York time, five years after the completion of our initial business combination or earlier upon redemption or liquidation, subject to the terms and conditions contained in the warrant agreement governing the warrants. For more information regarding the warrants, please see the section entitled “Description of Securities.” Our initial stockholders hold an aggregate 7,870,000 shares of our pre-transaction Class B common stock, all of which were issued in private placements prior to our IPO, as well as the 610,000 shares of our Class A common stock contained in the placement units.

 

   

PWP is a leading global independent advisory firm that provides strategic and financial advice to clients across a range of the most active industry sectors and international markets. PWP provides advisory services to a wide range of clients globally, including large public multinational corporations, mid-sized public and private companies, individual entrepreneurs, private and institutional investors, creditor committees and government institutions. For more information about PWP, please see the section entitled “Information about PWP.”

 

   

On December 29, 2020, FTIV, the Sponsor, PWP OpCo, PWP GP, Professional Partners and Professionals GP entered into the Business Combination Agreement. The Business Combination contemplates that, among other things, FTIV will acquire a minority partnership interest in PWP OpCo, Professional Partners and certain investor limited partners of PWP will together acquire a majority voting interest in FTIV, and PWP OpCo will, following the Closing, serve as FTIV’s operating partnership as part of an umbrella limited partnership C-corporation (Up-C) structure.

 

   

In accordance with the terms and subject to the conditions of the Business Combination Agreement:

 

  (i)

the Company will acquire newly-issued common units of PWP OpCo in exchange for cash in an amount equal to the outstanding excess cash balances of the Company (including the proceeds from the PIPE Investment (as defined below)) as of Closing net of redemptions elected by the Company’s public stockholders pursuant to their redemption rights described below and net of transaction costs of the Company with the number of

 

7


Table of Contents
  such interests to be issued to be calculated based on the formula set forth on Schedule C to the Business Combination Agreement);

 

  (ii)

Professional Partners will contribute the equity interests of PWP GP, the general partner of PWP OpCo, to the Company;

 

  (iii)

the Company will issue to PWP OpCo, which will distribute (A) to Professional Partners, new shares of Class B-1 common stock, which will have 10 votes per share (for so long as Professional Partners or its limited partners as of the Closing maintain direct or indirect ownership of at least 10% of the issued and outstanding Class A partnership units of PWP OpCo, at which point such Class B-1 common stock shall have one vote per share) and (B) to ILPs, new shares of Class B-2 common stock, which will have one vote per share, with the number of shares of such common stock to be issued to equal the number of common units of PWP OpCo that will be held by Professional Partners and such ILPs, respectively, following the Closing, but prior to redemption of certain electing ILPs and Legacy Partners; and

 

  (iv)

the Company will repay certain indebtedness of PWP OpCo and its subsidiaries, and pay certain expenses, and PWP OpCo will, subject to the availability of transaction proceeds and retaining a reasonable amount of balance sheet cash, first redeem PWP OpCo units held by certain electing ILPs, and second, redeem PWP OpCo units held by certain electing Legacy Partners and retain any remaining proceeds for general corporate purposes.

 

   

The number of shares of our Class B-1 common stock that will be owned by Professional Partners and Class B-2 common stock that will be owned by certain ILPs, respectively, as Stock Consideration, and therefore the percentage ownership of PWP OpCo by the Company, is not currently known, and will vary depending on, among other things, the level of redemptions of shares of the Company’s Class A common stock by our public stockholders. For further details, see “Proposal No. 1—The Business Combination Proposal—The Business Combination Agreement.”

 

   

At the Closing, we will enter into the Tax Receivable Agreement, substantially in the form attached as Annex G, with PWP OpCo, Professional Partners and certain other persons party thereto (the “Tax Receivable Agreement”). The Tax Receivable Agreement will generally provide for payment by the Company to ILPs and certain Partners (as defined therein) of 85% of the amount of cash savings, if any, in U.S. federal, state, local and foreign income taxes and related interest that we actually realize (or are deemed to realize) as a result of (a) exchanges by the ILPs or Limited Partners and certain other transactions and (b) tax benefits related to imputed interest deemed to be paid by us as a result of the Tax Receivable Agreement. See “Proposal No. 1—The Business Combination Proposal—Related Agreements—Tax Receivable Agreement.”

 

   

Certain investors (collectively, the “PIPE Investors”) have collectively subscribed for 12,500,000 shares of the Company’s Class A common stock for an aggregate purchase price equal to $125 million (the “PIPE Investment”), including $1.5 million subscribed by entities related to the Sponsor, which may be increased by up to $23.5 million. The PIPE Investment will be consummated concurrently with the Closing. In this proxy statement, we assume that, under the No Redemptions Scenario (as defined below), we will have an aggregate of approximately $325 million of the proceeds from the PIPE Investment and funds held in the trust account, net of deemed transaction expenses of $30 million, which net proceeds will be used to fund the cash consideration. Approximately $195 million of the such proceeds will be used by PWP to retire existing indebtedness, with the remaining amount (subject to PWP retaining of up to $10 million to add to its balance sheet cash) being used to first redeem PWP OpCo units held

 

8


Table of Contents
 

by certain electing ILPs, and second, redeem PWP OpCo units held by certain electing Legacy Partners. Any remaining cash proceeds will be retained by PWP for general corporate purposes and for payment of any transaction expenses in excess of $30 million. In the Maximum Redemptions Scenario (as defined below) (which assumes the redemption of approximately 15.5 million shares of Class A common stock), we would have an aggregate of approximately $200 million (from the proceeds from the PIPE Investment and remaining funds held in the trust account), net of deemed transaction expenses of $30 million, such proceeds of which, together with PWP balance sheet cash, will be used by PWP to retire existing indebtedness and to pay transaction expenses in excess of $30 million.

 

   

Prior to the Closing, Professional Partners owns approximately 79.7% of the outstanding equity interests of PWP OpCo, and the ILPs own approximately 20.3% of the outstanding equity interests of PWP OpCo.

 

   

It is anticipated that, upon completion of the Business Combination, based upon the As Exchanged Class A Share Ownership Assumptions (as defined below): (1) the Company’s public stockholders would own approximately 24.7% of our outstanding Class A common stock; (2) the PIPE Investors (including the Sponsor Related PIPE Investors) would own approximately 13.4% of our outstanding Class A common stock; (3) the Sponsor and our other Initial Stockholders would own approximately 8.0% of our outstanding Class A common stock; (4) Professional Partners would own approximately 49.1% of our outstanding Class A common stock; and (5) certain ILPs would own approximately 4.8% of our outstanding Class A common stock. These levels of ownership interest assume (a) that no shares are elected to be redeemed in connection with the Business Combination, (b) that we issue an aggregate of approximately 50.2 million shares of Class B-1 common stock and Class B-2 common stock, with the Class B-1 common stock being owned by Professional Partners and the Class B-2 common stock being owned by ILPs, as part of the consideration for the Business Combination in connection with the Business Combination Agreement (after giving effect to expected redemptions of PWP OpCo units by certain electing ILPs and certain electing Legacy Partners), (c) all of the stockholders were to exchange their PWP OpCo units and shares of our Class B-1 common stock and Class B-2 common stock for shares of Class A common stock (i.e., these levels of ownership interest reflect ownership of Class A common stock on an as exchanged basis) and (d) that we issue 12,500,000 shares of Class A common stock to the PIPE Investors; in addition, the ownership percentage with respect to the post-business combination company (x) does not take into account (i) warrants to purchase Class A common stock that will remain outstanding immediately following the Business Combination, (ii) any RSUs currently expected to be issued in connection with the Closing, including (a) 10.2 million RSUs under the Transaction Pool Share Reserve and (b) up to 9.5 million RSUs expected to be granted as Management Awards under the General Share Reserve, as described in the section entitled “Executive Compensation—Other Executive Compensation Elements—Management Awards”, or (iii) any shares that may be issuable 45 days after Closing to the Redeeming Holders (as defined below) pursuant to a Top-Up Payment (as defined below), but (y) does include founder shares, which will automatically convert into shares of Class A common stock on a one-for-one basis upon the consummation of the Business Combination (such shares of Class A common stock will be subject to transfer restrictions) (such assumptions collectively, the “As Exchanged Class A Share Ownership Assumptions”). If the actual facts are different from these As Exchanged Class A Share Ownership Assumptions, the above levels of ownership interest will be different.

 

   

Following the completion of the Business Combination, (a) Professional Partners will beneficially own all of the outstanding shares of our Class B-1 common stock, representing

 

9


Table of Contents
 

approximately 90.6% of our total voting power, (b) ILPs will beneficially own all of the outstanding shares of our Class B-2 common stock, representing approximately 0.9% of our total voting power, and (c) holders of Class A common stock will own shares of our Class A common stock, representing approximately 8.5% of our total voting power.

 

   

Following the completion of the Business Combination, it is expected that the Perella Weinberg Partners’ board of directors will approve the Perella Weinberg Partners Amended and Restated Bylaws in the form attached to this proxy statement as Annex C.

 

 

LOGO

For more information, see “Summary of the Proxy Statement—Impact of the Business Combination on the Company’s Public Float” and “Unaudited Pro Forma Condensed Combined Financial Information.”

 

   

In evaluating the Business Combination, our Board considered a number of factors, including PWP’s highly attractive business model, PWP’s deep relationships with a diverse customer base, PWP’s experienced and proven management team, PWP’s strong balance sheet, other alternatives, terms of the Business Combination Agreement and continued ownership by Working Partners generally. For more information about our decision-making process, as well as other factors, uncertainties and risks considered, see the section entitled “Proposal No. 1—The Business Combination Proposal—Reasons for the Approval of the Business Combination.”

 

10


Table of Contents
   

Pursuant to the Existing Certificate of Incorporation, a holder of our public shares (a “public stockholder”) may request that we redeem all or a portion of such public stockholder’s public shares for cash if the Business Combination is consummated. Holders of our units must elect to separate the units into the underlying public shares and warrants prior to exercising redemption rights with respect to the public shares. If holders hold their units through a broker, bank or other nominee, holders must notify their broker, bank or other nominee that they elect to separate the units into the underlying public shares and warrants, or if a holder holds units registered in its own name, the holder must contact Continental Stock Transfer & Trust Company, our transfer agent, directly and instruct it to do so. Public stockholders may elect to redeem their public shares even if they vote “FOR” the Business Combination Proposal or any other proposal. If the Business Combination is not consummated, the public shares will be returned to the respective public stockholder, broker, bank or other nominee. If the Business Combination is consummated, and if a public stockholder properly exercises its right to redeem all or a portion of the public shares that it holds, including by timely delivering its shares to our transfer agent, we will redeem such public shares for a per share price, payable in cash, equal to the pro rata portion of the trust account established at the consummation of our initial public offering (the “trust account”), calculated as of two business days prior to the consummation of the Business Combination, including interest (net of taxes payable). For illustrative purposes, as of December 31, 2020, this would have amounted to approximately $10.00 per outstanding public share. If a public stockholder properly exercises its redemption rights in full, then it will be electing to exchange all of its public shares for cash and will not own any public shares of the post-business combination company. See “Special Meeting of FTIV Stockholders—Redemption Rights” in the accompanying proxy statement for a detailed description of the procedures to be followed if you wish to redeem your public shares for cash. Holders of our outstanding warrants do not have redemption rights in connection with the Business Combination. Unless otherwise specified, the information in the accompanying proxy statement assumes that none of our public stockholders exercise their redemption rights with respect to their shares of Class A common stock.

 

   

In addition to voting on the proposal to approve and adopt the Business Combination Agreement and approve the Business Combination (we refer to this proposal as the “Business Combination Proposal”), at the Special Meeting, our stockholders will be asked to vote upon:

 

   

a proposal to approve, (i) for purposes of complying with Nasdaq Listing Rules 5635(a) and (b), the issuance of more than 20% of our issued and outstanding common stock and the resulting change of control in connection with the Business Combination; and (ii) for purposes of complying with Nasdaq Listing Rule 5635(d), the issuance of 12,500,000 shares of common stock in connection with the PIPE Investment, subject to an increase to up to 14,850,000 shares, upon the completion of the Business Combination;

 

   

five separate proposals to consider and vote upon proposed amendments to our Existing Certificate of Incorporation (subject to the terms and provisions of the Stockholders Agreement), with such amendments to be effective upon the Closing, to (i) create an additional class of directors so that there will be three classes of directors with staggered terms of office, and make certain related changes, in each case, to the fullest extent permitted by law, (ii) provide that certain transactions are not “corporate opportunities” and that each of the partners, principals, directors, officers, members, managers, employees, consultants, independent contractors and/or other service providers of Professional Partners or any of its subsidiaries, Perella Weinberg Partners LLC or any of its subsidiaries, FinTech Investor Holdings IV, LLC, FinTech Masala Advisors, LLC or any of their respective affiliates (excluding the Company or any of its subsidiaries) are not subject to the doctrine of corporate opportunity, (iii) increase the number of authorized shares of our capital stock, (iv) create additional classes of our common stock to be designated as Class B-1 common stock, having 10 votes per share, and Class B-2 common stock, having 1 vote per share, and

 

11


Table of Contents
 

(v) provide for additional changes, principally changing our name from “FinTech Acquisition Corp. IV” to “Perella Weinberg Partners” and removing provisions applicable to special purpose acquisition companies;

 

   

a proposal to elect Betsy Z. Cohen, Brittain Ezzes and Madelyn Antoncic as directors to serve on our board of directors as Class I directors under our Existing Certificate of Incorporation until the earlier of the Closing and the 2022 annual meeting of stockholders, and until their respective successors are duly elected and qualified or until their earlier resignation, removal or death;

 

   

a proposal to elect three Class I directors, three Class II directors, and three Class III directors to serve, effective as of, and contingent upon, the Closing, on our board of directors until the 2022, 2023 and 2024 annual meetings of stockholders, respectively, and until their respective successors are duly elected and qualified, or until their earlier resignation, removal or death;

 

   

a proposal to approve the Incentive Plan, including the authorization of the initial share reserve under the Incentive Plan;

 

   

a proposal to approve the French Sub-Plan; and

 

   

a proposal to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event there are insufficient votes for, or for any other reason in connection with, the approval of one or more of the other proposals at the Special Meeting.

See “Proposal No. 1—The Business Combination Proposal,” “Proposal No. 2—The Nasdaq Proposal,” “Proposal No. 3—The Charter Classified Board Proposal,” “Proposal No. 4—The Charter Corporate Opportunity Proposal,” “Proposal No. 5—The Authorized Capital Stock Proposal,” “Proposal No. 6—The Class B Stock Proposal,” “Proposal No. 7—The Charter Additional Amendments Proposal,” “Proposal No. 8—The Existing Director Election Proposal,” “Proposal No. 9—The Business Combination Director Election Proposal,” “Proposal No. 10—The Incentive Plan Proposal,” “Proposal No. 11—The French Sub-Plan Proposal” and “Proposal No. 12—The Adjournment Proposal.” The Business Combination is conditioned on the approval of each of the Condition Precedent Proposals at the Special Meeting. Each of the Condition Precedent Proposals is cross-conditioned on the approval of each other. Neither the Existing Director Election Proposal nor the Adjournment Proposal is conditioned upon the approval of any other proposal. Each of these proposals is more fully described in this proxy statement, which each stockholder is encouraged to read carefully and in its entirety.

 

   

Upon consummation of the Business Combination, our Board anticipates increasing its initial size from five directors to nine directors, including three Class I directors, three Class II directors, and three Class III directors. The initial terms of the Class I, Class II and Class III directors will expire at each of the first three annual meetings of our stockholders following the consummation of the Business Combination, respectively, and in each case, when any successor has been duly elected and qualified or until their earlier resignation, removal or death. Please see the sections entitled “Proposal No. 9—The Business Combination Director Election Proposal” and “Management after the Business Combination” for additional information.

 

   

Unless waived by the applicable party to the Business Combination Agreement, and subject to applicable law, the Closing is subject to a number of conditions set forth in the Business Combination Agreement including, among others, (a) minimum Company Cash of $200,000,000; (b) approval of the Business Combination by the Company’s stockholders; (c) the lack of any Company Material Adverse Effect, Professionals Material Adverse Effect or Parent Material Adverse Effect (each as defined in the Business Combination Agreement) since the date of the Business Combination Agreement; (d) the receipt of certain regulatory

 

12


Table of Contents
 

approvals (including of the Canadian Securities Regulators (as defined below), Investment Industry Regulatory Organization of Canada (“IIROC”), FINRA, the ACPR and the FSMA); (e) a minimum of $5,000,001 of net tangible assets of the Company following the exercise by the Company’s public stockholders of the redemption rights; and/or (f) the consummation of the PIPE Investment. These conditions to closing in the Business Combination Agreement are for the sole benefit of the parties thereto and may be waived by such parties. There can be no assurance that the parties to the Business Combination Agreement would waive any such provision of the Business Combination Agreement. PWP has obtained all required governance votes and all required constituent consents necessary to effect the Closing.

 

   

The Business Combination Agreement may be terminated at any time prior to the consummation of the Business Combination upon agreement of the parties thereto, or by FTIV or PWP in specified circumstances.

 

   

The Business Combination, including our business following the Business Combination, involves numerous risks. For more information about these risks, please see the section entitled “Risk Factors.”

 

   

When you consider the recommendation of our Board in favor of approval of the Business Combination Proposal and the other proposals included herein, you should keep in mind that the Sponsor and our directors have interests in such proposal that are different from, or in addition to, those of our stockholders and warrant holders generally. Our Board was aware of and considered these interests, among other matters, in evaluating and negotiating the Business Combination and transaction agreements and in recommending to our stockholders that they vote in favor of the proposals presented at the Special Meeting, including the Business Combination Proposal. FTIV stockholders should take these interests into account in deciding whether to approve the proposals presented at the Special Meeting, including the Business Combination Proposal. These interests include, among other things:

 

   

If we do not consummate a business combination by September 29, 2022 (or if such date is extended at a duly called meeting of our stockholders, such later date), we will (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. In such event, the 7,870,000 shares of pre-transaction Class B common stock owned by our Initial Stockholders, including the Sponsor, would be worthless because following the redemption of the public shares, we would likely have few, if any, net assets and because the Sponsor and each of our officers and directors have agreed to waive their rights to liquidating distributions from the trust account with respect to such shares if we fail to complete a business combination within the required period. Additionally, in such event, the 203,333 private placement warrants contained in the placement units that the Sponsor purchased will expire worthless. Certain of our directors, including Betsy Z. Cohen, Daniel G. Cohen, James J. McEntee, III, Brittain Ezzes, Madelyn Antoncic, Laura S. Kohn and Jan Rock Zubrow, have a direct or indirect economic interest in such shares and private placement warrants. The 6,846,667 shares of Class A common stock that the Initial Stockholders will hold following the Business Combination (after giving effect to the surrender by the Sponsor, without consideration therefor, of 1,023,333 shares of our Class B common stock) if unrestricted and freely tradable, would have had an aggregate market value of approximately $79.42 million based upon the closing price of $11.60 per share of Class A common stock on the Nasdaq on May 3, 2021, the most recent practicable date prior to the date of this proxy statement. Given such shares of our common

 

13


Table of Contents
 

stock will be subject to certain restrictions, we believe such shares have less value. The 203,333.33 private placement warrants that the Sponsor will hold following the Business Combination, if unrestricted and freely tradable, would have had an aggregate market value of approximately $321,266.66 based upon the closing price of $1.58 per warrant on the Nasdaq on May 3, 2021, the most recent practicable date prior to the date of this proxy statement.

 

   

Peter A. Weinberg is expected to be the Chairman of our board after the consummation of the Business Combination. Daniel G. Cohen, who is Chief Executive Officer of FTIV, is expected to be a director on the board after consummation of the Business Combination. As such, in the future, Mr. Cohen may receive any cash fees, stock options, stock awards or other remuneration that the board determines to pay to him.

 

   

Our existing officers and directors will be eligible for continued indemnification and continued coverage under directors’ and officers’ liability insurance after the Business Combination and pursuant to the Business Combination Agreement.

 

   

In order to protect the amounts held in the trust account, the Sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below: (1) $10.00 per public share; or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case, net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of our IPO against certain liabilities, including liabilities under the Securities Act.

 

   

Cantor Fitzgerald & Co. and Wells Fargo Securities, LLC, as representatives of the several underwriters in our IPO, are entitled to a deferred fee of $9,800,000 pursuant to the underwriting agreement. The deferred fee will become payable to the representatives from the amounts held in the trust account solely in the event that the Company completes an initial business combination, subject to the terms of the underwriting agreement. In March 2021, the underwriters and the Company entered into an agreement that modified the existing underwriting agreement. The agreement specifies that, upon the successful completion of an initial business combination, the deferred underwriter’s commission owed to Cantor Fitzgerald & Co. will be reduced by $2,000,000 and that the deferred underwriter’s commission owed to Wells Fargo Securities, LLC will be reduced by $1,000,000.

 

   

In order to finance transaction costs in connection with an initial business combination, the Sponsor, members of FTIV’s management team or any of their respective affiliates or other third parties may, but are not obligated to, loan FTIV funds as may be required (“Working Capital Loans”), which will be repaid only upon the consummation of an initial business combination. If FTIV does not consummate an initial business combination, FTIV may use a portion of any funds held outside the trust account to repay the Working Capital Loans; however, no proceeds from the trust account may be used for such repayment. If such funds are insufficient to repay the Working Capital Loans, the unpaid amounts would be forgiven. Up to $1,500,000 of the Working Capital Loans may be converted into units at a price of $10.00 per unit at the option of the holder. The units would be identical to the private placement units. As of December 31, 2020, there were no amounts outstanding under the Working Capital Loans.

 

   

The PIPE Investors have subscribed for $125 million of the PIPE Investment, for which they will receive 12.5 million shares of our Class A common stock, including $1.5 million

 

14


Table of Contents
 

subscribed by the Sponsor Related PIPE Investors, which may be increased by up to $23.5 million, for which they will receive a minimum of 150,000 and a maximum of 2.5 million shares of our Class A common stock. See “Proposal No. 1—The Business Combination Proposal—Related Agreements— Subscription Agreement.”

 

   

Pursuant to the Amended and Restated Registration Rights Agreement (as defined below), the Sponsor, Professional Partners, the ILPs and others party thereto will have customary registration rights, including demand and piggy-back rights, subject to cooperation, cut-back provisions and suspension periods with respect to the shares of Class A common stock and warrants held by such parties.

 

15


Table of Contents

QUESTIONS AND ANSWERS ABOUT THE PROPOSALS FOR OUR STOCKHOLDERS AND THE SPECIAL MEETING

The questions and answers below highlight only selected information from this document and only briefly address some commonly asked questions about the proposals to be presented at the Special Meeting, including with respect to the Business Combination. The following questions and answers do not include all the information that is important to our stockholders. We urge our stockholders to read this proxy statement, including the Annexes and the accompanying financial statements of the Company and PWP carefully and in their entirety to fully understand the Business Combination and the voting procedures for the Special Meeting, which will be held on                , 2021 at                Eastern Time virtually, accessible at www.cstproxy.com/fintechacquisitioncorpiv/sm2021, or at such other time, on such other date and at such other place to which the meeting may be adjourned or postponed.

 

Q:

Why am I receiving this proxy statement?

 

A:

Our stockholders are being asked to consider and vote upon, among other proposals, a proposal to approve and adopt the Business Combination Agreement and approve the Business Combination. The Business Combination contemplates that, among other things, FTIV will acquire a minority partnership interest in PWP, Professional Partners and certain investor limited partners of PWP OpCo will together acquire a majority voting interest in FTIV and PWP OpCo will, following the Closing, serve as FTIV’s operating partnership as part of an umbrella limited partnership C-corporation (Up-C) structure. In accordance with the terms and subject to the conditions of the Business Combination Agreement:

 

  (i)

the Company will acquire newly-issued common units of PWP OpCo in exchange for cash in an amount equal to the outstanding excess cash balances of the Company (including the proceeds from the PIPE Investment) as of Closing net of redemptions elected by the Company’s public stockholders pursuant to their redemption rights described below and net of transaction costs of the Company, with the number of such interests to be issued to be calculated based on the formula set forth on Schedule C to the Business Combination Agreement;

 

  (ii)

Professional Partners will contribute the equity interests of PWP GP, the general partner of PWP OpCo, to the Company;

 

  (iii)

the Company will issue to PWP OpCo, which will distribute (A) to Professional Partners, new shares of Class B-1 common stock, which will have 10 votes per share (for so long as Professional Partners or its limited partners as of the Closing maintain direct or indirect ownership of at least 10% of the issued and outstanding Class A partnership units of PWP OpCo, at which point such Class B-1 common stock shall have one vote per share) and (B) to ILPs, new shares of Class B-2 common stock, which will have one vote per share, with the number of shares of such common stock to be issued to equal the number of common units of PWP OpCo that will be held by Professional Partners and such ILPs, respectively, following the Closing (together, the “Stock Consideration”), but prior to redemption of certain electing ILPs and Legacy Partners; and

 

  (iv)

the Company will repay certain indebtedness of PWP OpCo and its subsidiaries, and pay certain expenses, and PWP OpCo will, subject to the availability of transaction proceeds and retaining a reasonable amount of balance sheet cash, first redeem PWP OpCo units held by certain electing ILPs, and second, redeem PWP OpCo units held by certain electing Legacy Partners and retain any remaining proceeds for general corporate purposes.

The number of shares of our Class B-1 common stock that will be owned by Professional Partners and Class B-2 common stock that will be owned by certain ILPs, respectively, and

 

16


Table of Contents

therefore the percentage ownership of PWP OpCo by the Company, is not currently known, and will vary depending on, among other things, the level of redemptions of shares of Class A common stock by our public stockholders. For further details, see “Proposal No. 1—The Business Combination Proposal.”

A copy of the Business Combination Agreement is attached to this proxy statement as Annex A and you are encouraged to read it carefully and in its entirety.

THE VOTE OF STOCKHOLDERS IS IMPORTANT. STOCKHOLDERS ARE ENCOURAGED TO VOTE AS SOON AS POSSIBLE AFTER READING THIS PROXY STATEMENT, INCLUDING THE ANNEXES AND THE ACCOMPANYING FINANCIAL STATEMENTS OF THE COMPANY AND PWP, CAREFULLY AND IN ITS ENTIRETY.

 

Q:

When and where is the Special Meeting?

 

A:

The Special Meeting will be held virtually on                , 2021 at                Eastern Time, accessible at www.cstproxy.com/fintechacquisitioncorpiv/sm2021, or at such other time, on such other date and at such other place to which the meeting may be adjourned or postponed.

 

Q:

What are the specific proposals on which I am being asked to vote at the Special Meeting?

 

A:

In addition to voting on a proposal to approve and adopt the Business Combination Agreement and approve the Business Combination, at the Special Meeting, FTIV is asking holders of its common stock to consider and vote upon:

 

   

a proposal to approve, (i) for purposes of complying with Nasdaq Listing Rules 5635(a) and (b), the issuance of more than 20% of our issued and outstanding common stock and the resulting change of control in connection with the Business Combination; and (ii) for purposes of complying with Nasdaq Listing Rule 5635(d), the issuance of 12,500,000 shares of common stock in connection with the PIPE Investment, subject to an increase to up to 14,850,000 shares, upon the completion of the Business Combination;

 

   

five separate proposals to consider and vote upon proposed amendments to our Existing Certificate of Incorporation (subject to the terms and provisions of the Stockholders Agreement), with such amendments to be effective upon the Closing, to (i) create an additional class of directors so that there will be three classes of directors with staggered terms of office, and make certain related changes, (ii) provide that certain transactions are not “corporate opportunities” and that each of the partners, principals, directors, officers, members, managers, employees, consultants, independent contractors and/or other service providers of Professional Partners or any of its subsidiaries, Perella Weinberg Partners LLC or any of its subsidiaries, FinTech Investor Holdings IV, LLC, FinTech Masala Advisors, LLC or any of their respective affiliates (excluding the Company or any of its subsidiaries) are not subject to the doctrine of corporate opportunity, in each case, to the fullest extent permitted by law, (iii) to increase the number of authorized shares of our capital stock, (iv) create additional classes of our common stock to be designated as Class B-1 common stock, having 10 votes per share, and Class B-2 common stock, having 1 vote per share, and (v) provide for additional changes, principally including changing our name from “FinTech Acquisition Corp. IV” to “Perella Weinberg Partners” and removing provisions applicable to special purpose acquisition companies;

 

   

a proposal to elect Betsy Z. Cohen, Brittain Ezzes and Madelyn Antoncic as directors to serve on our board of directors as Class I directors under the Existing Certificate of Incorporation until the earlier of the Closing and the 2022 annual meeting of stockholders, and until their respective successors are duly elected and qualified or until their earlier resignation, removal or death;

 

   

a proposal to elect three Class I directors, three Class II directors, and three Class III directors to serve, effective as of, and contingent upon, the Closing, on our board of directors until the

 

17


Table of Contents
 

2022, 2023 and 2024 annual meetings of stockholders, respectively, and until their respective successors are duly elected and qualified, or until their earlier resignation, removal or death;

 

   

a proposal to approve the Incentive Plan, including the authorization of the initial share reserve under the Incentive Plan;

 

   

a proposal to approve the French Sub-Plan; and

 

   

a proposal to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event there are insufficient votes for, or for any other reason in connection with, the approval of one or more of the other proposals at the Special Meeting.

If our stockholders do not approve each of the Condition Precedent Proposals, then unless certain conditions in the Business Combination Agreement are waived by the applicable parties to the Business Combination Agreement, the Business Combination Agreement could terminate and the Business Combination may not be consummated. See “Proposal No. 1—The Business Combination Proposal,” “Proposal No. 2—The Nasdaq Proposal,” “Proposal No. 3—The Charter Classified Board Proposal,” “Proposal No. 4—The Charter Corporate Opportunity Proposal,” “Proposal No. 5—The Authorized Capital Stock Proposal,” “Proposal No. 6—The Class B Stock Proposal,” “Proposal No. 7—The Charter Additional Amendments Proposal,” “Proposal No. 8—The Existing Director Election Proposal,” “Proposal No. 9—The Business Combination Director Election Proposal,” “Proposal No. 10—The Incentive Plan Proposal,” “Proposal No. 11—The French Sub-Plan Proposal” and “Proposal No. 12—The Adjournment Proposal.”

We will hold the Special Meeting to consider and vote upon these proposals. This proxy statement contains important information about the Business Combination and the other matters to be acted upon at the Special Meeting. Our stockholders should read it carefully and in its entirety.

After careful consideration, FTIV’s board of directors has determined that the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposals, the Existing Director Election Proposal, the Business Combination Director Election Proposal, the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal are in the best interests of FTIV and its stockholders and unanimously recommends that you vote or give instruction to vote “FOR” each of those proposals.

The existence of financial and personal interests of one or more of FTIV’s directors may result in a conflict of interest on the part of such director(s) between what they may believe is in the best interests of FTIV and its stockholders and what they may believe is best for themselves in determining to recommend that stockholders vote for the proposals. See “Proposal No. 1—The Business Combination Proposal—Interests of FTIV Directors and Officers in the Business Combination” for a further discussion of these considerations.

 

Q:

Are the proposals conditioned on one another?

 

A:

Yes. The Business Combination is conditioned on the approval of each of the Condition Precedent Proposals at the Special Meeting. Each of the Condition Precedent Proposals is cross-conditioned on the approval of each other. Neither the Existing Director Election Proposal nor the Adjournment Proposal is conditioned upon the approval of any other proposal.

 

Q:

Why is FTIV proposing the Business Combination?

 

A:

FTIV was organized to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

PWP is a leading global independent advisory firm that provides strategic and financial advice to clients across a range of the most active industry sectors and international markets. PWP

 

18


Table of Contents

provides advisory services to a wide range of clients globally, including large public multinational corporations, mid-sized public and private companies, individual entrepreneurs, private and institutional investors, creditor committees and government institutions. For more information about PWP see “Information about PWP.”

Based on its due diligence investigations of PWP and the industry in which it operates, including the financial and other information provided by PWP in the course of our due diligence investigations, our board of directors believes that the Business Combination with PWP is in the best interests of us and our stockholders and presents an opportunity to increase stockholder value. However, there is no assurance of this. See “Proposal No. 1—The Business Combination ProposalReasons For the Business Combination” for additional information.

Although our board of directors believes that the Business Combination with PWP presents a unique business combination opportunity and is in the best interests of us and our stockholders, our board of directors did consider certain potentially material negative factors in arriving at that conclusion. These factors are discussed in greater detail in the section entitled “Proposal No. 1—The Business Combination ProposalReasons For the Business Combination,” as well as in the sections entitled “Risk Factors—Risks Related to the Business of PWP.”

 

Q:

What consideration is being provided for the Business Combination?

 

A:

As a result of and upon the consummation of the Business Combination, among other things, FTIV will acquire a minority partnership interest in PWP OpCo, Professional Partners and certain ILPs will together acquire a majority voting interest in FTIV, and PWP OpCo will, following the Closing, serve as FTIV’s operating partnership as part of an umbrella limited partnership C-corporation (Up-C) structure.

 

   

In accordance with the terms and subject to the conditions of the Business Combination Agreement:

 

  (i)

the Company will acquire newly-issued common units of PWP OpCo in exchange for cash in an amount equal to the outstanding excess cash balances of the Company (including the proceeds from the PIPE Investment (as defined below)) as of Closing net of redemptions elected by the Company’s public stockholders pursuant to their redemption rights described below and net of transaction costs of the Company, with the number of such interests to be issued to be calculated based on the formula set forth on Schedule C to the Business Combination Agreement;

 

  (ii)

Professional Partners will contribute the equity interests of PWP GP, the general partner of PWP OpCo, to the Company;

 

  (iii)

the Company will issue (A) to Professional Partners, new shares of Class B-1 common stock, which will have 10 votes per share (for so long as Professional Partners or its limited partners as of the Closing maintain direct or indirect ownership of at least 10% of the issued and outstanding Class A partnership units of PWP OpCo, at which point such Class B-1 common stock shall have one vote per share) and (B) to ILPs, new shares of Class B-2 common stock, which will have one vote per share, with the number of shares of such common stock to be issued to equal the number of common units of PWP OpCo that will be held by Professional Partners and such ILPs, respectively, following the Closing (together, the “Stock Consideration”), but prior to redemption of certain electing ILPs and Legacy Partners; and

 

  (iv)

the Company will repay certain indebtedness of PWP OpCo and its subsidiaries, and pay certain expenses, and PWP OpCo will, subject to the availability of transaction proceeds and retaining a reasonable amount of balance sheet cash, first redeem PWP OpCo units

 

19


Table of Contents
  held by certain electing ILPs, and second, redeem PWP OpCo units held by certain electing Legacy Partners and retain any remaining proceeds for general corporate purposes.

 

   

The number of shares of our Class B-1 common stock that will be owned by Professional Partners and Class B-2 common stock that will be owned by certain ILPs, respectively, as Stock Consideration, and therefore the percentage ownership of PWP OpCo by the Company, is not currently known, and will vary depending on, among other things, the level of redemptions of shares of Class A common stock by our public stockholders. For further details, see “Proposal No. 1—The Business Combination Proposal—The Business Combination Agreement.”

 

   

At the Closing, we will enter into the Tax Receivable Agreement, substantially in the form attached as Annex G, with PWP OpCo, Professional Partners and certain other persons party thereto. The Tax Receivable Agreement will generally provide for payment by the Company to ILPs and certain Partners (as defined therein) of 85% of the amount of cash savings, if any, in U.S. federal, state, local and foreign income taxes and related interest that we actually realize (or are deemed to realize) as a result of (a) exchanges by the ILPs or Limited Partners and certain other transactions and (b) tax benefits related to imputed interest deemed to be paid by us as a result of the Tax Receivable Agreement. See “Proposal No. 1—The Business Combination ProposalTax Receivable Agreement.”

 

Q:

What equity stake will current stockholders of FTIV, PIPE Investors, including the Sponsor Related PIPE Investors, and PWP hold in us after the closing?

 

A:

As of the date of this proxy statement, there are 31,480,000 shares of our common stock outstanding, which includes the 7,870,000 founder shares held by the initial stockholders and the 23,610,000 public shares. As of the date of this proxy statement, there is outstanding an aggregate of 7,870,000 warrants, which includes 203,333.33 private placement warrants held by the Sponsor and approximately 7,666,666.67 million public warrants. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock. Therefore, as of the date of this proxy statement (without giving effect to the Business Combination), our fully diluted share capital would be approximately 39.4 million.

It is anticipated that, upon completion of the Business Combination, based upon the As Exchanged Class A Share Ownership Assumptions: (1) the Company’s public stockholders would own approximately 24.7% of our outstanding Class A common stock; (2) the PIPE Investors (including the Sponsor Related PIPE Investors) would own approximately 13.4% of our outstanding Class A common stock (assuming an issuance of 12,500,000 shares of Class A common stock); (3) the Sponsor and our other Initial Stockholders would own approximately 8.0% of our outstanding Class A common stock; (4) Professional Partners would own approximately 49.1% of our outstanding Class A common stock; and (5) certain ILPs would own approximately 4.8% of our outstanding Class A common stock. If the actual facts are different from the As Exchanged Class A Share Ownership Assumptions, the above levels of ownership interest will be different.

Following the completion of the Business Combination, (a) Professional Partners will beneficially own all of the outstanding shares of our Class B-1 common stock, representing approximately 90.6% of our total voting power, (b) ILPs will beneficially own all of the outstanding shares of our Class B-2 common stock, representing approximately 0.9% of our total voting power, and (c) holders of Class A common stock will own shares of our Class A common stock, representing approximately 8.5% of our total voting power.

The following table illustrates varying ownership levels in Perella Weinberg Partners immediately following the consummation of the Business Combination based on the assumptions above,

 

20


Table of Contents

except for varying levels of additional redemptions by the public stockholders and in the Maximum Redemptions Scenario these levels of ownership interest assume that we issue approximately 61.1 million shares of Class B-1 common stock and Class B-2 common stock to Professional Partners and certain ILPs, respectively, as part of the consideration for the Business Combination in connection with the Business Combination Agreement (after giving effect to expected redemptions of PWP OpCo units by certain electing ILPs and certain electing Legacy Partners). If the actual facts are different from these assumptions, the above levels of ownership interest will be different. Share numbers in the table below are in millions and are rounded to the nearest thousand shares.

 

    No Redemptions
Scenario(1)
          Max Redemptions
Scenario (2)
 
    Shares     % of
[A]
    % of
[B]
    Adjustments(2)     Shares      % of
[A]
    % of
[B]
 

Class A Common Stock Outstanding at Closing

 

FTIV Shareholders

    23.0       24.7     22.2     (15.5     7.5        8.5     7.6

Placement Shares

    0.6       0.7     0.6           0.6        0.7     0.6

Founder Shares Not Subject to Performance Targets(3)

    1.4       1.5     1.3           1.4        1.5     1.4

Founder Shares Subject to Performance Targets(4)

    5.5       5.9     5.3           5.5        6.2     5.5

PIPE Investors(5)

    12.5       13.4     12.1           12.5        14.1     12.7

Sub-Total Class A Common Stock Outstanding at Closing

    43.0       46.1     41.5     (15.5     27.5        31.0     27.8
Class A Common Stock Assuming All PWP OpCo Units Exchanged and Class B Common Stock Held by Professional Partners and ILPs are Exchanged for Class A Common Stock

 

Professional Partners

 

            

Legacy Partners and Non-PWP Working Partners(6)

    7.4       7.9     7.1     2.9       10.2        11.6     10.4

PWP Working Partners

 

            

PWP Working Partners—Vested Units (Up to 5 Year Lockup)

    15.6       16.7     15.1           15.6        17.6     15.8

PWP Working Partners—Unvested Units (Up to 5 Year Vesting)

    22.8       24.4     22.0           22.8        25.7     23.1
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Sub-Total PWP Working Partners

    38.4       41.2     37.1           38.4        43.3     38.9
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Sub-Total Professional Partners

    45.7       49.1     44.2     2.9       48.6        54.9     49.2

ILPs

    4.5       4.8     4.3     8.0       12.4        14.1     12.6
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Sub-Total Additional Class A Common Stock Assuming All PWP OpCo Units Exchanged

    50.2       53.9     48.6     10.8       61.1        69.0     61.9
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

[A] Class A Common Stock (Assuming PWP OpCo Units are Fully Exchanged) Excluding Unvested RSUs(7)

    93.2       100.0     90.1     (4.7     88.5        100.0     89.7
Unvested RSUs(8) (If Vested)—Preliminary Estimate RSU Allocations, Subject to Board Approval

 

Time-based Predominantly Vesting Less Than 3 Years

    7.0             6.8           7.0              7.1

Performance-based Vesting Years 3-5

    3.2             3.1           3.2              3.2
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Sub-Total Unvested RSUs

    10.2             9.9           10.2              10.3
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

[B] Grand Total Including All Founder Shares and RSUs (If Vested)(7)

    103.4             100.0     (4.7     98.7              100.0

Of Which: Class A Common Stock Held by PWP Working Partners, Employees and Consultants(7)

    48.6             47.0           48.6              49.2

Warrants Struck at $11.50 (Excluded Above)

    7.9       NA       NA             7.9        NA       NA  

 

21


Table of Contents

Voting Schedule (Assuming PWP OpCo Units Have Not Been Exchanged)(9)

 

          No Redemptions Scenario(1)           Max Redemptions
Scenario(2)
 
    Votes /
Share
    Shares     Votes     % Vote           Shares     Votes     %
Vote
 

Class A Common(10)

    1       43.0       43.0       8.5       27.5       27.5       5.2

Class B-1 Common

    10       45.7       457.4       90.6       48.6       486.1       92.4

Class B-2 Common

    1       4.5       4.5       0.9       12.4       12.4       2.4
   

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

 

Total

      93.2       504.9       100.0       88.5       526.0       100.0

Notes

All amounts on this capitalization table are approximate.

Grand Total includes full amount of Founder Shares; excludes unvested RSUs and warrants.

(1)

Assumes no shares of FTIV are redeemed; includes ILP and Legacy Partner redemptions.

(2)

Adjustments reflect change in assumptions between No Redemptions Scenario and Max Redemptions Scenario. Per Business Combination Agreement, Max Redemptions Scenario assumes maximum 15.5 million shares of FTIV redeemed (based on $230 million cash from FTIV and $125 million cash from PIPE Investment, compared with $200 million Company Cash requirement at Closing; assumes $10.00 per outstanding share). Assumes no ILP or Legacy Partner redemptions as all PIPE proceeds are applied to debt repurchase and transaction expenses.

(3)

20% of Founder Shares (1.4 million unrestricted of 6.8 million) are not subject to performance targets.

(4)

80% of Founder Shares (5.5 million restricted of 6.8 million) are divided equally into four tranches that cannot be sold or transferred until the later of (i) the six month anniversary of Closing and (ii) the earlier of (x) the ten year anniversary of Closing and (y) the date that is 15 days following the first date that the closing stock price exceeds $12.00, $13.50, $15.00 and $17.00, respectively, for 20 out of any 30 consecutive trading days.

(5)

Reflects 12.5 million shares held by PIPE Investors, with proceeds to redeem 10.8 million shares received by exchanging ILPs and Legacy Partners and the balance of proceeds retained on balance sheet in No Redemptions Scenario. In Max Redemptions Scenario, all PIPE proceeds are applied to debt repurchase and transaction expenses.

(6)

Includes partners of Professional Partners who currently are employed by the asset management business that was separated from PWP OpCo in 2019.

(7)

Assumes that all PWP OpCo Units and Class B-1 and Class B-2 common stock held by Professional Partners and ILPs, respectively, are exchanged for Class A common stock. As the Class B-1 and Class B-2 shares have de minimis economic rights, they have been excluded from the calculations in this table of Class A common stock issued upon exchange of PWP OpCo Units and Class B shares.

(8)

RSU amounts reflect preliminary estimate allocations pursuant to the Transaction Pool (as described in greater detail in the section entitled “Executive Compensation—Other Executive Compensation Elements—Transaction Pool Awards” below), subject to the consideration, review and approval of the compensation committee. Excludes the Management Awards that are expected to be granted out of the General Share Reserve (as described in greater detail in the section entitled “Executive Compensation—Other Executive Compensation Elements—Management Awards” below), the final amount, terms and conditions of which will be subject to the consideration, review and approval of the compensation committee.

(9)

Excludes unvested RSUs and warrants, which are out of the money at $10.00 per outstanding share.

(10)

Class A common stock includes Placement Shares, shares held by PIPE Investors, as well as all Founder Shares (Class B common stock to convert to Class A common stock upon Closing).

For more information, please see the sections entitled “Summary of the Proxy Statement—Ownership of the Company Following the Business Combination” and “Unaudited Pro Forma Condensed Combined Financial Information.”

 

Q:

What will happen in the Business Combination?

 

A:

The Business Combination contemplates that, among other things, FTIV will acquire a minority partnership interest in PWP OpCo, Professional Partners and certain ILPs will together acquire a majority voting interest in FTIV, and PWP OpCo will, following the Closing, serve as FTIV’s operating partnership as part of an umbrella limited partnership C-corporation (Up-C) structure. In accordance with the terms and subject to the conditions of the Business Combination Agreement:

 

  (i)

the Company will acquire newly-issued common units of PWP OpCo in exchange for cash in an amount equal to the outstanding excess cash balances of the Company (including the proceeds from the PIPE Investment (as defined below)) as of Closing net of redemptions elected by the Company’s public stockholders pursuant to their redemption rights described below and net of transaction costs of the Company, with the number of such interests to be

 

22


Table of Contents
  issued to be calculated based on the formula set forth on Schedule C to the Business Combination Agreement;

 

  (ii)

Professional Partners will contribute the equity interests of PWP GP, the general partner of PWP OpCo, to the Company;

 

  (iii)

the Company will issue to PWP OpCo, which will distribute (A) to Professional Partners, new shares of Class B-1 common stock, which will have 10 votes per share (for so long as Professional Partners or its limited partners as of the Closing maintain direct or indirect ownership of at least 10% of the issued and outstanding Class A partnership units of PWP OpCo, at which point such Class B-1 common stock shall have one vote per share) and (B) to ILPs, new shares of Class B-2 common stock, which will have one vote per share, with the number of shares of such common stock to be issued to equal the number of common units of PWP OpCo that will be held by Professional Partners and such ILPs, respectively, following the Closing, but prior to redemption of certain electing ILPs and Legacy Partners; and

 

  (iv)

the Company will repay certain indebtedness of PWP OpCo and its subsidiaries, and pay certain expenses, and PWP OpCo will, subject to the availability of transaction proceeds and retaining a reasonable amount of balance sheet cash, first redeem PWP OpCo units held by certain electing ILPs, and second, redeem PWP OpCo units held by certain electing Legacy Partners and retain any remaining proceeds for general corporate purposes.

The number of shares of Class B-1 common stock that will be owned by Professional Partners and Class B-2 common stock that will be owned by certain ILPs, respectively, and therefore the percentage ownership of PWP OpCo by the Company, is not currently known, and will vary depending on, among other things, the level of redemptions of shares of Class A common stock by our public stockholders. For further details, see “Proposal No. 1—The Business Combination Proposal.”

A copy of the Business Combination Agreement is attached to this proxy statement as Annex A and you are encouraged to read it carefully and in its entirety.

 

Q:

Following the Business Combination, will the Company’s securities continue to trade on a stock exchange?

 

A:

Yes. We intend to apply to continue the listing of our Class A common stock and warrants on the Nasdaq under the symbols “PWP” and “PWPPW,” respectively, upon the Closing, though such securities may not be listed, for instance, if there is not a sufficient number of round lot holders.

 

Q:

How has the announcement of the Business Combination affected the trading price of the Company’s Class A common stock?

 

A:

On December 29, 2020, the trading date before the public announcement of the Business Combination, FTIV’s public units, Class A common stock and warrants closed at $11.80, $10.845 and $2.50, respectively. On May 3, 2021, the most recent practicable date prior to the date of this proxy statement, the Company’s public units, Class A common stock and warrants closed at $11.66, $11.60 and $1.58, respectively.

 

Q:

How will the Business Combination affect the shares of the Company outstanding after the Business Combination?

 

A:

As a result of the Business Combination, including the PIPE Investment, the amount of shares of common stock outstanding will increase from 23,610,000 to approximately 94,127,000 (assuming

 

23


Table of Contents
  that no public shares are redeemed). Additional shares of common stock may be issuable in the future as a result of the issuance of additional shares that are not currently outstanding, including: (1) issuance of shares of Class A common stock upon exercise of the public warrants and private placement warrants after the Business Combination, (2) pursuant to the Incentive Plan, a copy of which is attached to this proxy statement as Annex H and (3) shares that may be issuable 45 days after Closing to the Redeeming Holders pursuant to a Top-Up Payment, see “Certain Relationships and Related Persons Transactions—PWP’s Related Party Transactions—Convertible Notes.” The issuance and sale of such shares could adversely impact the market price of our common stock, even if our business is doing well.

 

Q:

Is the Business Combination the first step in a “going private” transaction?

 

A:

No. The Company does not intend for the Business Combination to be the first step in a “going private” transaction. One of the primary purposes of the Business Combination is to provide a platform for PWP to access the U.S. public markets.

 

Q:

Will the management of PWP change in the Business Combination?

 

A:

We anticipate that all of the executive officers of PWP will remain with the post-business combination company. Additionally, Joseph R. Perella, Peter A. Weinberg, Robert K. Steel, Dietrich Becker, Andrew Bednar, Jorma Ollila, Ivan G. Seidenberg, Jane C. Sherburne and Daniel G. Cohen have each been nominated to serve as directors of the post-business combination company upon completion of the Business Combination. Please see the sections entitled “Proposal No. 9—The Business Combination Director Election Proposal” and “Management After the Business Combination” for additional information.

 

Q:

Will the Company obtain new financing in connection with the Business Combination?

 

A:

Yes. The PIPE Investors have agreed to purchase in the aggregate approximately 12,500,000 shares of Class A common stock, for approximately $125 million of gross proceeds, in the PIPE Investment, including $1.5 million subscribed by the Sponsor Related PIPE Investors, which may be increased by up to $23.5 million, for which they will receive a minimum of 150,000 and a maximum of 2.5 million shares of our Class A common stock. The PIPE Investment is contingent upon, among other things, stockholder approval of the Business Combination Proposal and the Closing. See “Proposal No. 1—The Business Combination Proposal—Related Agreements—Subscription Agreement.” The Company does not currently anticipate assuming any net indebtedness of PWP nor obtaining any new debt financing to fund the Business Combination.

 

Q:

What conditions must be satisfied to complete the Business Combination?

 

A:

The Business Combination Agreement is subject to the satisfaction or waiver of certain closing conditions, including, among others, (a) minimum Company Cash of $200,000,000; (b) approval of the Business Combination by the Company’s stockholders; (c) the lack of any Company Material Adverse Effect, Professionals Material Adverse Effect or Parent Material Adverse Effect (each as defined in the Business Combination Agreement) since the date of the Business Combination Agreement; (d) the receipt of certain regulatory approvals (including of the Canadian Securities Regulators, IIROC, FINRA, the ACPR and the FSMA); (e) a minimum of $5,000,001 of net tangible assets of the Company following the exercise by the Company’s public stockholders of the redemption rights; and/or (f) the consummation of the PIPE Investment. PWP has obtained all required governance votes and all required constituent consents necessary to effect the Business Combination. For more information about conditions to the consummation of the Business Combination, see “Proposal No. 1—The Business Combination Proposal—The Business Combination Agreement.”

 

24


Table of Contents
Q:

When do you expect the Business Combination to be completed?

 

A:

It is currently expected that the Business Combination will be consummated in the first half of 2021. This date depends, among other things, on the approval of the proposals to be put to FTIV’s stockholders at the Special Meeting and certain regulatory approvals. However, such meeting could be adjourned if the Adjournment Proposal is adopted by FTIV’s stockholders at the Special Meeting and FTIV elects to adjourn the Special Meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event there are insufficient votes for, or for any other reason in connection with, the approval of one or more of the other proposals at the Special Meeting. For a description of the conditions for the completion of the Business Combination, see “Proposal No. 1—The Business Combination Proposal—The Business Combination Agreement.”

 

Q:

What happens if the Business Combination is not consummated?

 

A:

If FTIV is not able to complete the Business Combination with PWP by September 29, 2022 (or if such date is extended at a duly called meeting of stockholders, such later date) and is not able to complete another business combination by such date, FTIV will (1) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter redeem the public shares, at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest but less taxes payable (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of FTIV’s remaining stockholders and FTIV’s board of directors, dissolve and liquidate, subject in each case to FTIV’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

 

Q:

How many votes do I have at the Special Meeting?

 

A:

Our Class A stockholders and Class B stockholders are entitled to one vote on each proposal, presented at the Special Meeting for each share of our common stock held of record as of                , 2021 the record date for the Special Meeting. As of the close of business on the record date, there were                  outstanding shares of our common stock (including                  shares of our Class B common stock).

 

Q:

Did FTIV’s board of directors obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Business Combination?

 

A:

No. Neither the FTIV board of directors nor any committee thereof is required to obtain an opinion from an independent investment banking or accounting firm that the price that we are paying for PWP is fair to us from a financial point of view. Neither the FTIV board of directors nor any committee thereof obtained a third party valuation in connection with the Business Combination. In analyzing the Business Combination, the FTIV board of directors conducted due diligence on PWP and reviewed comparisons of selected financial data of PWP with certain of its peers in the industry and the financial terms set forth in the Business Combination Agreement. Based on the foregoing, the FTIV board of directors concluded that the Business Combination was in the best interest of FTIV’s stockholders.

 

Q:

Do I have redemption rights?

 

A:

If you are a holder of public shares, you have the right to request that we redeem all or a portion of your public shares for cash provided that you follow the procedures and deadlines described

 

25


Table of Contents
  elsewhere in this proxy statement. Public stockholders may elect to redeem all or a portion of the public shares held by them regardless of if or how they vote in respect of the Business Combination Proposal or any other proposal set forth herein. If you wish to exercise your redemption rights, see the answer to the next question: “How do I exercise my redemption rights?

Notwithstanding the foregoing, a public stockholder, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act), will be restricted from redeeming its public shares with respect to more than an aggregate of 15% of the public shares. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the public shares, then any such shares in excess of that 15% limit would not be redeemed for cash. In addition, pursuant to the Existing Certificate of Incorporation, in no event will we redeem public shares in an amount that would cause our net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) to be less than $5,000,001. In such case, we would not proceed with the redemption of our public shares and the Business Combination, and instead may search for an alternate initial business combination.

The Sponsor has agreed to waive its redemption rights in connection with the consummation of the Business Combination with respect to all of the shares of our common stock held by them in connection with the consummation of the Business Combination. Our shares of pre-transaction Class B common stock will be excluded from the pro rata calculation used to determine the per share redemption price.

 

Q:

How do I exercise my redemption rights?

 

A:

In order to exercise your redemption rights, you must, prior to 5:00 p.m., Eastern Time on                , 2021 (two business days before the Special Meeting), (x) submit a written request, which includes the name of the beneficial owner of the shares to be redeemed, to our transfer agent that we redeem your public shares for cash, and (y) deliver your stock to our transfer agent physically or electronically through the Depository Trust Company, or DTC. The address of Continental Stock Transfer & Trust Company, our transfer agent, is listed under the question “Who can help answer my questions?” below.

Any demand for redemption, once made, may be withdrawn at any time until the date of the Special Meeting. After the date of the Special Meeting, a demand for redemption may only be withdrawn with the Company’s written consent. If you deliver your shares for redemption to our transfer agent and decide within the required timeframe not to exercise your redemption rights, you may request that our transfer agent return the shares to you (physically or electronically). You may make such request by contacting our transfer agent at the address listed under the question “Who can help answer my questions?” below.

 

Q:

If I am a holder of units, can I exercise redemption rights with respect to my units?

 

A:

No. Holders of outstanding units must elect to separate the units into the underlying public shares and warrants prior to exercising redemption rights with respect to the public shares. If you hold your units through a broker, bank or other nominee, you must notify your broker, bank or other nominee that you elect to separate the units into the underlying public shares and warrants, or if you hold units registered in your own name, you must contact our transfer agent directly and instruct them to do so. You are requested to cause your public shares to be separated and delivered to our transfer agent, by 5:00 p.m., Eastern Time, on                , 2021 (two business days before the scheduled date of the Special Meeting) in order to exercise your redemption rights with respect to your public shares.

 

26


Table of Contents
Q:

If I am a holder of warrants, can I exercise redemption rights with respect to my warrants?

 

A:

No. The holders of our warrants have no redemption rights with respect to our warrants or any shares of our common stock underlying our warrants.

 

Q:

Can the Sponsor redeem its founder shares in connection with consummation of the Business Combination?

 

A:

No. The Sponsor has agreed to waive its redemption rights in connection with the consummation of the Business Combination with respect to all of the founder shares in connection with the consummation of the Business Combination. Our shares of pre-transaction Class B common stock will be excluded from the pro rata calculation used to determine the per share redemption price.

 

Q:

Is there a limit on the number of shares I may redeem?

 

A:

Yes. A public stockholder, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act), will be restricted from redeeming its public shares with respect to more than an aggregate of 15% of the public shares. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the public shares, then any such shares in excess of that 15% limit would not be redeemed for cash. However, in no event is your ability to vote all of your shares (including those shares held by you or by a “group” in excess of 15% of the shares sold in our IPO) for or against our Business Combination restricted.

 

Q:

Is there a limit on the total number of shares that may be redeemed?

 

A:

Yes. Pursuant to the Existing Certificate of Incorporation, in no event will we redeem public shares in an amount that would cause our net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) to be less than $5,000,001. In such case, we would not proceed with the redemption of our public shares and the Business Combination, and instead may search for an alternate initial business combination.

The Business Combination Agreement sets forth a condition providing for minimum Company Cash of $200,000,000, thereby limiting the maximum number of public shares that could be redeemed in connection with the Business Combination. If such condition is not met, and such condition is not or cannot be waived under the terms of the Business Combination Agreement, then the Business Combination Agreement could terminate and the Business Combination may not be consummated. Based on the amount of $230,005,861 in the trust account as of December 31, 2020, and taking into account the anticipated gross proceeds of approximately $125 million from the PIPE Investment, approximately 15.5 million public shares may be redeemed and still enable us to have sufficient cash to satisfy the cash closing conditions in the Business Combination Agreement. We refer to this as the “redemption scenario.”

 

Q:

Will how I vote affect my ability to exercise redemption rights?

 

A:

No. Stockholders may elect to redeem all or a portion of the public shares held by them regardless of if or how they vote in respect of the Business Combination Proposal or any other proposal set forth herein. As a result, the Business Combination Agreement can be approved by stockholders who will redeem their shares and no longer remain stockholders, leaving stockholders who choose not to redeem their shares holding shares in a company with a potentially less-liquid trading market, fewer stockholders, potentially less cash and the potential inability to meet the listing standards of the Nasdaq.

 

27


Table of Contents
Q:

Do I have appraisal rights in connection with the Business Combination?

 

A:

No. Neither our stockholders nor our warrant holders have appraisal rights in connection with the Business Combination under the Delaware General Corporation Law (the “DGCL”).

 

Q:

What happens to the funds deposited in the trust account after consummation of the Business Combination?

 

A:

Following the closing of the IPO, an amount equal to $230.0 million ($10.00 per unit) of the net proceeds from the IPO and the sale of the private placement warrants was placed in the trust account. As of December 31, 2020, funds in the trust account totaled $230,005,861. These funds will remain in the trust account, except for the withdrawal of interest to pay taxes, if any, until the earliest of (1) the completion of a business combination (including the Closing), (2) the redemption of any public shares properly tendered in connection with a stockholder vote to amend the Existing Certificate of Incorporation to modify the substance or timing of FTIV’s obligation to redeem 100% of its public shares if it does not complete its initial business combination by September 29, 2022; and (3) the redemption of all of the public shares if FTIV is unable to complete its initial business combination by September 29, 2022 (or if such date is extended at a duly called meeting of stockholders, such later date), subject to applicable law.

Upon consummation of the Business Combination, the funds deposited in the trust account will be released to pay holders of our public shares who properly exercise their redemption rights and then will be distributed to PWP OpCo for general corporate purposes of the combined company, which may include repayment of indebtedness.

 

Q:

What do I need to do now?

 

A:

Whether or not you plan to participate in the virtual Special Meeting, we urge you to read this proxy statement (including the Annexes) carefully, including the section entitled “Risk Factors,” and to consider how the Business Combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement and on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker, bank or other nominee.

 

Q:

How do I vote?

 

A:

If you were a holder of record of our common stock on                , 2021, the record date for the Special Meeting, you may vote online during the Special Meeting or any adjournment thereof by accessing www.cstproxy.com/fintechacquisitioncorpiv/sm2021, or by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided in accordance with the instructions set forth on the enclosed proxy card. If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or other nominee, you should follow the instructions provided to you by your broker, bank or other nominee to ensure that votes related to the shares you beneficially own are properly represented and voted at the Special Meeting. In this regard, you must provide the record holder of your shares with instructions on how to vote your shares or, if you wish to participate in the virtual Special Meeting and vote online during the Special Meeting, obtain a legal proxy from your broker, bank or other nominee and email a copy (a legible photograph is sufficient) of your legal proxy to proxy@continentalstock.com.

 

Q:

If my shares are held in “street name,” will my broker, bank or other nominee automatically vote my shares for me?

 

A:

No. If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the “beneficial holder” of the shares held for you in what is known as “street name.” If

 

28


Table of Contents
  this is the case, this proxy statement may have been forwarded to you by your broker, bank or other nominee, or its agent, and you may need to obtain a proxy form from the institution that holds your shares and follow the instructions included on that form regarding how to instruct your broker, bank or other nominee as to how to vote your shares. Under the rules of various national and regional securities exchanges, your broker, bank or other nominee cannot vote your shares with respect to non-discretionary matters unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank or other nominee. We believe all of the proposals presented to our stockholders will be considered non-discretionary and therefore your broker, bank or other nominee will not vote your shares without your instruction. Your broker, bank or other nominee can vote your shares only if you provide instructions on how to vote. As the beneficial holder, you have the right to direct your broker, bank or other nominee as to how to vote your shares and you should instruct your broker, bank or other nominee to vote your shares in accordance with directions you provide. If you do not provide voting instructions to your broker, bank or other nominee on a particular proposal on which your broker, bank or other nominee does not have discretionary authority to vote, your shares will not be voted on that proposal. This is called a “broker non-vote.” An abstention will be counted towards the quorum requirement for each of the proposals presented at the Special Meeting but a broker non-vote will not. In connection with the Nasdaq Proposal, the Existing Director Election Proposal and the Business Combination Director Election Proposal, abstentions and broker non-votes will have no effect on the vote of each proposal. In connection with the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal, abstentions will be counted as present and entitled to vote at the Special Meeting and will have the same effect as voting “AGAINST” the proposal, but broker non-votes will have no effect on the vote of each proposal. In connection with the Business Combination Proposal and the Charter Proposals, abstentions and broker non-votes will have the same effect as voting “AGAINST” the proposal.

 

Q:

Who is entitled to vote at the Special Meeting?

 

A:

FTIV has fixed                , 2021 as the record date for the Special Meeting. If you were a stockholder of FTIV at the close of business on the record date, you are entitled to vote on matters that come before the Special Meeting. However, a stockholder may only vote his, her or its shares if he, she or it is present in person virtually or is represented by proxy at the Special Meeting.

 

Q:

What happens if I sell my shares of common stock before the Special Meeting?

 

A:

The record date for the Special Meeting is earlier than the date of the Special Meeting and earlier than the date that the Business Combination is expected to be completed. If you transfer your shares of common stock after the applicable record date, but before the Special Meeting, unless you grant a proxy to the transferee, you will retain your right to vote at the Special Meeting with respect to such shares but the transferee, and not you, will have the ability to redeem such shares (if time permits).

 

Q:

How do I register to participate in the virtual Special Meeting?

 

A:

To register for the virtual Special Meeting, please follow these instructions as applicable to the nature of your ownership of our common stock.

If your shares are registered in your name with our transfer agent and you wish to participate in the online-only virtual meeting, go to www.cstproxy.com/fintechacquisitioncorpiv/sm2021, enter the control number you received on your proxy card and click on “Click here” to preregister for the

 

29


Table of Contents

online meeting link at the top of the page. Just prior to the start of the meeting you will need to log back into the meeting site using your control number. Pre-registration is recommended but is not required in order to attend.

Beneficial stockholders who wish to participate in the online-only virtual meeting must obtain a legal proxy by contacting their account representative at the bank, broker, or other nominee that holds their shares and email a copy (a legible photograph is sufficient) of their legal proxy to proxy@continentalstock.com. Beneficial stockholders who email a valid legal proxy will be issued a meeting control number that will allow them to register to attend and participate in the online-only meeting. After contacting our transfer agent, a beneficial holder will receive an email prior to the meeting with a link and instructions for entering the virtual meeting. Beneficial stockholders should contact our transfer agent at least five business days prior to the meeting date.

 

Q:

How do I access the virtual Special Meeting website?

 

A:

You will need your control number for access. If you do not have your control number, contact Continental Stock Transfer & Trust Company at the phone number or email address below. Beneficial stockholders who hold shares through a bank, broker or other nominee will need to contact them and obtain a legal proxy. Once you have your legal proxy, contact Continental Stock Transfer & Trust Company to have a control number generated. Continental Stock Transfer & Trust Company’s contact information is as follows: 917-262-2373, or email proxy@continentalstock.com.

 

Q:

What constitutes a quorum at the Special Meeting?

 

A:

A quorum will be present at the Special Meeting if a majority of the shares of our common stock outstanding and entitled to vote at the Special Meeting is represented at the meeting by virtual attendance or by proxy. If a stockholder fails to vote his, her or its shares online during the Special Meeting or by proxy, or if a broker fails to vote online during the Special Meeting or by proxy shares held by it in nominee name, such shares will not be counted for the purposes of establishing a quorum. If a stockholder who holds his, her or its shares in “street name” through a bank, broker or other nominee fails to give voting instructions to such bank, broker or other nominee (a “broker non-vote”) on all of the proposals set forth in this proxy statement, such shares will not be counted for the purposes of establishing a quorum. An abstention from voting, shares represented at the Special Meeting by virtual attendance or by proxy but not voted on one or more proposals, or a broker non-vote, so long as the stockholder has given the bank, broker or other nominee voting instructions on at least one of the proposals in this proxy statement, will each count as present for the purposes of establishing a quorum. In the absence of a quorum, the chairman of the Special Meeting may adjourn the Special Meeting. As of the record date for the Special Meeting, the presence by virtual attendance or by proxy of                  shares of our common stock is required to achieve a quorum.

 

Q:

What vote is required to approve each proposal at the Special Meeting?

 

A:

The approval of each of the Business Combination Proposal and the Charter Proposals requires the affirmative vote of holders of a majority of the outstanding shares of our common stock entitled to vote thereon at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote online during the Special Meeting, an abstention from voting or a broker non-vote will each have the same effect as voting “AGAINST” the Business Combination Proposal and the Charter Proposals.

The approval of each of the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal requires the affirmative vote of holders of a majority of our outstanding

 

30


Table of Contents

shares of common stock present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or an abstention from voting will each have the same effect as voting “AGAINST” such proposal, and a broker non-vote will have no effect on the vote for such proposal.

The approval of the Nasdaq Proposal requires the affirmative vote of holders of a majority of the votes cast by holders of outstanding shares of common stock present in person virtually or represented by proxy and entitled to vote on at the Special Meeting. Accordingly, an abstention from voting or a broker non-vote will have no effect on the outcome of the Nasdaq Proposal.

In order to be elected as a director as described in the Existing Director Election Proposal or the Business Combination Director Election Proposal, a nominee must receive a plurality of all the votes of the shares present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting, which means that the nominees who receive the most votes are elected. Accordingly, a stockholder’s failure to vote online during the Special Meeting or by proxy, a broker non-vote or an abstention will have no effect on the outcome of the Existing Director Election Proposal or the Business Combination Director Election Proposal.

 

Q:

What are the recommendations of FTIV’s board of directors?

 

A:

FTIV’s board of directors believes that the Business Combination Proposal and the other proposals to be presented at the Special Meeting are in the best interest of FTIV’s stockholders and unanimously recommends that its stockholders vote “FOR” the Business Combination Proposal, “FOR” the Nasdaq Proposal, “FOR” the Charter Classified Board Proposal, “FOR” the Charter Corporate Opportunity Proposal, “FOR” the Authorized Capital Stock Proposal, “FOR” the Class B Proposal, “FOR” the Charter Additional Amendments Proposal, “FOR” each of the director nominees set forth in the Existing Director Election Proposal and the Business Combination Director Election Proposal, “FOR” the Incentive Plan Proposal, “FOR” the French Sub-Plan Proposal and “FOR” the Adjournment Proposal, in each case, if presented to the Special Meeting.

The existence of financial and personal interests of one or more of FTIV’s directors may result in a conflict of interest on the part of such director(s) between what he or they may believe is in the best interests of FTIV and its stockholders and what he or they may believe is best for himself or themselves in determining to recommend that stockholders vote for the proposals. See the section entitled “Proposal No. 1—The Business Combination Proposal— Interests of FTIV Directors and Officers in the Business Combination” for a further discussion of these considerations.

 

Q:

How will the initial stockholders and the Company’s directors and officers vote?

 

A:

In connection with our IPO, we entered into an agreement with each of our initial stockholders, our executive officers and our directors, pursuant to which they agreed to vote any shares of our common stock owned by them in favor of a proposed initial business combination. As of the date of this proxy statement, our initial stockholders, the Sponsor, owns approximately 26.9% of our issued and outstanding shares of common stock, including all of the founder shares. None of our initial stockholders, have entered into agreements, and are not currently in negotiations, to purchase or sell shares prior to the record date.

In addition, following the execution and delivery of the Business Combination Agreement, on December 29, 2020, the Sponsor entered into a Support Agreement with (i) us, (ii) PWP OpCo, PWP GP, Professional Partners and Professionals GP (collectively, the “PWP Entities”) and (iii) certain equity holders of the PWP entities (the “Support Agreement”), pursuant to which the parties thereto agreed to vote any shares of our common stock owned by them (representing as

 

31


Table of Contents

of the date hereof approximately 26.9% of the outstanding shares of our common stock) in favor of the Business Combination Proposal and other proposals described in this proxy statement and presented at the Special Meeting.

 

Q:

May I change my vote after I have mailed my signed proxy card?

 

A:

Yes. You may change your vote by sending a later-dated, signed proxy card to our transfer agent at the address listed under “Who can help answer my questions?” below so that it is received by the transfer agent prior to the Special Meeting, or participate in the virtual Special Meeting and vote online during the Special Meeting. You also may revoke your proxy by sending a notice of revocation to Amanda Abrams by email at aabrams@cohenandcompany.com or in writing to FinTech Acquisition Corp. IV, 2929 Arch Street, Suite 1703, Philadelphia, Pennsylvania 19104, or by telephone at (215) 701-9555, which must be received by Ms. Abrams prior to the Special Meeting.

 

Q:

What will happen if I sign and return my proxy card without indicating how I wish to vote?

 

A:

Signed and dated proxies received by us without an indication of how the stockholder intends to vote on a proposal will be voted “FOR” each proposal presented at the Special Meeting or any adjournment thereof.

 

Q:

What will happen if I abstain from voting or fail to vote at the Special Meeting?

 

A:

At the Special Meeting, if you abstain from voting with respect to a particular proposal, your shares will be counted as present for purposes of establishing a quorum. For purposes of approving the proposals, failure to vote or an abstention will each have the same effect as voting “AGAINST” each of the Business Combination Proposal, the Charter Proposals, the Incentive Plan Proposal, French Sub-Plan Proposal and the Adjournment Proposal. A failure to vote or an abstention will have no effect on the outcome of each of the Nasdaq Proposal, the Existing Director Election Proposal and the Business Combination Director Election Proposal.

 

Q:

If I am not going to participate in the virtual Special Meeting, should I return my proxy card instead?

 

A:

Yes. Whether you plan to participate in the virtual Special Meeting or not, please read this proxy statement carefully, and vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided in accordance with the instructions set forth on the enclosed proxy card.

 

Q:

What should I do with my stock certificates, warrant certificates or unit certificates?

 

A:

Our stockholders who exercise their redemption rights must deliver (either physically or electronically) their stock certificates to our transfer agent prior to the Special Meeting.

Holders must complete the procedures for electing to redeem their public shares in the manner described above prior to 5:00 p.m., Eastern Time, on                , 2021 (two business days before the scheduled date of the Special Meeting) in order for their shares to be redeemed.

Our warrant holders should not submit the certificates relating to their warrants. Public stockholders who do not elect to have their public shares redeemed for the pro rata share of the trust account should not submit the stock certificates relating to their public shares.

 

32


Table of Contents
Q:

What should I do if I receive more than one set of voting materials?

 

A:

FTIV stockholders may receive more than one set of voting materials, including multiple copies of this proxy statement and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast a vote with respect to all of your shares of our common stock.

 

Q:

Who will solicit and pay the cost of soliciting proxies for the Special Meeting?

 

A:

We will pay the cost of soliciting proxies for the Special Meeting. FTIV has engaged Morrow Sodali LLC (“Morrow”) to assist in the solicitation of proxies for the Special Meeting. FTIV has agreed to pay Morrow a fee of $25,000, plus disbursements. FTIV will reimburse Morrow for reasonable out-of-pocket expenses and will indemnify Morrow and its affiliates against certain claims, liabilities, losses, damages and expenses. FTIV will also reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of our common stock for their expenses in forwarding soliciting materials to beneficial owners of our common stock and in obtaining voting instructions from those owners. FTIV’s management team may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person virtually. They will not be paid any additional amounts for soliciting proxies.

 

Q:

Who can help answer my questions?

 

A:

If you have questions about the proposals or if you need additional copies of this proxy statement or the enclosed proxy card you should contact:

Daniel G. Cohen, Chief Executive Officer

FinTech Acquisition Corp. IV

2929 Arch Street, Suite 1703

Philadelphia, Pennsylvania 19104

Tel: (215) 701-9555

You may also contact our proxy solicitor at:

Morrow Sodali LLC

470 West Avenue

Stamford, Connecticut 06902

Tel: (800) 662-5200 or banks and brokers can call collect at (203) 658-9400

Email: FTIV.info@investor.morrowsodali.com

To obtain timely delivery, our stockholders must request the materials no later than five business days prior to the Special Meeting.

You may also obtain additional information about us from documents filed with the SEC by following the instructions in the section entitled “Where You Can Find More Information.”

 

33


Table of Contents

If you intend to seek redemption of your public shares, you will need to send a letter demanding redemption and deliver your stock (either physically or electronically) prior to 5:00 p.m., Eastern Time, on                , 2021 (two business days before the Special Meeting) in order for your shares to be redeemed. If you have questions regarding the certification of your position or delivery of your stock, please contact:

Continental Stock Transfer & Trust Company

1 State Street, 30th floor

New York, NY 10004

Attention: Mark Zimkind

Email: mzimkind@continentalstock.com

If you have other questions please contact:

Amanda Abrams

FinTech Acquisition Corp. IV

2929 Arch Street, Suite 1703

Philadelphia, PA 19104

Tel: (215) 701-9693

Email: aabrams@cohenandcompany.com

 

34


Table of Contents

SUMMARY OF THE PROXY STATEMENT

This summary highlights selected information from this proxy statement and does not contain all of the information that is important to you. To better understand the proposals to be submitted for a vote at the virtual Special Meeting, including the Business Combination, you should read this proxy statement, including the information set forth under the sections “Risk Factors,” “FTIV Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “PWP Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as our and PWP’s historical consolidated financial statements and related notes and Annexes, in each case included elsewhere in this proxy statement. Some of the statements in this proxy statement constitute forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements.”

Unless otherwise specified, all share amounts and share calculations: (i) assume no exercise of redemption rights by our public stockholders, (ii) assume that an aggregate of approximately 50.2 million shares of our Class B-1 common stock and Class B-2 common stock, with the Class B-1 common stock being owned by Professional Partners and the Class B-2 common stock being owned by ILPs, as part of the consideration for the Business Combination in connection with the Business Combination Agreement (after giving effect to expected redemptions of PWP OpCo units by certain electing ILPs and certain electing Legacy Partners), and (iii) do not include (a) any warrants or options to purchase our common stock that will be outstanding following the Business Combination, (b) any unvested RSUs.

Parties to the Business Combination

FinTech Acquisition Corp. IV

We are a Delaware special purpose acquisition company formed in November 2018 for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

Our publicly-traded Class A common stock, units and warrants are currently traded on The Nasdaq Capital Market under the symbols “FTIV,” “FTIVU” and “FTIVW.” We intend to apply to continue the listing of our Class A common stock and warrants on The Nasdaq Capital Market under the symbols “PWP” and “PWPPW,” respectively, upon the Closing. Following the Business Combination, we expect to change our name to Perella Weinberg Partners.

The mailing address of our principal executive office is 2929 Arch Street, Suite 1703, Philadelphia, Pennsylvania 19104, and our telephone number is (215) 701-9555.

For additional information regarding the Company, see the section in this proxy statement entitled “Information about FTIV.”

PWP Holdings LP

PWP Holdings LP, a Delaware limited partnership operates an advisory business, as further described under the heading “Information about PWP”, that will become the operating partnership of Perella Weinberg Partners that holds its advisory business.

The mailing address of PWP Holdings LP’s principal executive office is 767 Fifth Avenue, New York, New York 10153, and its telephone number is (212) 287-3200.



 

35


Table of Contents

The Business Combination Proposal

On December 30, 2020, the Company announced that it entered into the Business Combination Agreement, dated as of December 29, 2020, by and among the Company, the Sponsor, PWP OpCo, PWP GP, Professional Partners, and Professionals GP, pursuant to which, among other things, and subject to the terms and conditions contained in the Business Combination Agreement, the Company will acquire a minority partnership interest in PWP OpCo, Professional Partners and certain investor limited partners of PWP OpCo will together acquire a majority voting interest in the Company, and PWP OpCo will, following the Closing, serve as the Company’s operating partnership as part of an umbrella limited partnership C-corporation (Up-C) structure. In accordance with the terms and subject to the conditions of the Business Combination Agreement:

 

  (i)

the Company will acquire newly-issued common units of PWP OpCo in exchange for cash in an amount equal to the outstanding excess cash balances of the Company (including the proceeds from the PIPE Investment) as of Closing net of redemptions elected by the Company’s public stockholders pursuant to their redemption rights described below, with the number of such interests to be issued to be calculated based on the formula set forth on Schedule C to the Business Combination Agreement;

 

  (ii)

Professional Partners will contribute the equity interests of PWP GP, the general partner of PWP OpCo, to the Company;

 

  (iii)

the Company will issue to PWP OpCo, which will distribute (A) to Professional Partners, new shares of Class B-1 common stock, which will have 10 votes per share (for so long as Professional Partners or its limited partners as of the Closing direct or indirect maintain ownership of at least 10% of the issued and outstanding Class A partnership units of PWP OpCo, at which point such Class B-1 common stock shall have one vote per share) and (B) to ILPs, new shares of Class B-2 common stock, which will have one vote per share, with the number of shares of such common stock to be issued to equal the number of common units of PWP OpCo that will be held by Professional Partners and such ILPs, respectively, following the Closing, but prior to redemption of certain electing ILPs and Legacy Partners; and

 

  (iv)

the Company will repay certain indebtedness of PWP OpCo and its subsidiaries, and pay certain expenses, and PWP OpCo will, subject to the availability of transaction proceeds and retaining a reasonable amount of balance sheet cash, first redeem PWP OpCo units held by certain electing ILPs, and second, redeem PWP OpCo units held by certain electing Legacy Partners and retain any remaining proceeds for general corporate purposes.

The number of shares of our Class B-1 common stock that will be owned by Professional Partners and Class B-2 common stock that will be owned by certain ILPs, respectively, and therefore the percentage ownership of PWP OpCo by the Company, is not currently known, and will vary depending on, among other things, the level of redemptions of shares of Class A common stock by our public stockholders. For further details, see “Proposal No. 1—The Business Combination Proposal.”

A copy of the Business Combination Agreement is attached to this proxy statement as Annex A and you are encouraged to read it carefully and in its entirety.

Redemption Rights

Pursuant to our Existing Certificate of Incorporation, holders of our public shares may elect to have their shares redeemed for cash at a redemption price per share calculated in accordance with our



 

36


Table of Contents

Existing Certificate of Incorporation. As of December 31, 2020, this would have amounted to approximately $10.00 per share. If a holder of public shares properly exercises his, her or its redemption rights, then such holder will be exchanging his, her or its shares of our common stock for cash and will no longer own such shares. See the section entitled “Special Meeting of FTIV Stockholders—Redemption Rights and Procedures” for the procedures to be followed if you wish to redeem your shares for cash and not continue to own our common stock following consummation of the Business Combination.

Notwithstanding the foregoing, a public stockholder, together with any affiliate of such public stockholder or any other person with whom such public stockholder is acting in concert or as a “group” (as defined in Section 13(d)(3) of the Exchange Act), will be restricted from redeeming its public shares with respect to more than an aggregate of 15% of the public shares. Accordingly, if a public stockholder, alone or acting in concert or as a group, seeks to redeem more than 15% of the public shares, then any such shares in excess of that 15% limit would not be redeemed for cash.

Neither the Business Combination will be consummated nor will any public shares be redeemed if public stockholders redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001.

Any redemptions by our public stockholders will decrease the funds in the trust account available to us to consummate the Business Combination and related transactions.

Impact of the Business Combination on the Company’s Public Float

It is anticipated that, upon completion of the Business Combination, based upon the As Exchanged Class A Share Ownership Assumptions: (1) the Company’s public stockholders would own approximately 24.7% of our outstanding Class A common stock; (2) the PIPE Investors (including the Sponsor Related PIPE Investors) would own approximately 13.4% of our outstanding Class A common stock (assuming an issuance of 12,500,000 shares of Class A common stock); (3) the Sponsor and our other Initial Stockholders would own approximately 8.0% of our outstanding Class A common stock; (4) Professional Partners would own approximately 49.1% of our outstanding Class A common stock; and (5) certain ILPs would own approximately 4.8% of our outstanding Class A common stock. If the actual facts are different from the As Exchanged Class A Share Ownership Assumptions, the above levels of ownership interest will be different.

See the sections entitled “Questions and Answers About the Proposals and the Special Meeting” and “Unaudited Pro Forma Condensed Combined Financial Information” for additional information.

Board of Directors of the Company Following the Business Combination

Upon consummation of the Business Combination, our board of directors will consist of three classes of directors (Class I, Class II, and Class III) and will change in size from five to nine directors. Each of our incumbent directors, Betsy Z. Cohen, Brittain Ezzes, Madelyn Antoncic, Laura S. Kohn and Jan Rock Zubrow, have advised us that they will resign from our board of directors upon the Closing.

See the sections entitled “Proposal No. 9—The Business Combination Director Election Proposal” and “Management After the Business Combination” for additional information.



 

37


Table of Contents

Regulatory Matters

Canada

Tudor, Pickering, Holt & Co. Securities—Canada, ULC (“TPH Canada”), an indirect, wholly-owned subsidiary of PWP OpCo, is registered as an investment dealer with the provincial securities regulators in the Canadian provinces of Alberta, British Columbia, Manitoba, Ontario, Québec and Saskatchewan (collectively, the “Canadian Securities Regulators”) and is a member of the IIROC. The Business Combination is accordingly subject to certain notice and approval requirements under Canadian securities legislation and the IIROC rules. On February 3, 2021, the Company and PWP OpCo submitted the required notices and applications for approval regarding the Business Combination to the Canadian Securities Regulators and IIROC. The Company and PWP OpCo received notice of non-objection to the Business Combination from the Canadian Securities Regulators on March 1, 2021 and approval of the Business Combination from IIROC on April 13, 2021.

FINRA

Perella Weinberg Partners’ two U.S. broker-dealer subsidiaries are subject to FINRA Rule 1017, which generally provides that FINRA approval must be sought in connection with any transaction resulting in a single person or entity acquiring or controlling, directly or indirectly, twenty-five percent (25%) or more of a FINRA member firm’s or its parent company’s equity for the first time. Perella Weinberg Partners’ two U.S. broker-dealer subsidiaries have sought FINRA’s approval under FINRA Rule 1017 in connection with the Business Combination.

France

Perella Weinberg Partners France, an indirect, wholly-owned subsidiary of PWP OpCo, is an investment firm regulated by the Autorité de Contrôle Prudentiel et de Résolution and by the Autorité des Marchés Financiers and is required to maintain a base capital requirement of 50,000.

Under the French Order (Arrêté) of December 4, 2017, relating to the approval and changes to the situation of investment firms (the “Order”), any person (including persons acting in concert within the meaning of Article L. 233-10 of the French Commercial Code) who intends to acquire or increase a “qualifying holding” (within the meaning of Article 6 of the Order) in an ACPR authorized investment firm must obtain the prior approval of the ACPR before doing so if certain conditions are met. The ACPR has sixty (60) working days (extendable once by up to another thirty (30) working days) after submission of a complete application to decide whether to approve the acquisition of, or increase in, control (the “ACPR Assessment Period”). If the ACPR has not determined the application within the ACPR Assessment Period then it is deemed to have approved the application.

Perella Weinberg Partners France is authorized and regulated by the ACPR in France. Consequently, any person acquiring or increasing a “qualifying holding” in Perella Weinberg Partners France must obtain the prior approval of the ACPR. The Business Combination is therefore subject to these requirements and may not be completed until the ACPR has approved, or is deemed to have approved, all the applications relating to the acquisition of a “qualifying holding.”

United Kingdom

Under the FSMA any person who intends to acquire or increase control (as described in the FSMA) of a U.K. Financial Conduct Authority (“FCA”) authorized firm must obtain the prior approval of



 

38


Table of Contents

the FCA before doing so. The FCA has sixty (60) working days (extendable once by up to another thirty (30) working days) after submission of a complete application to decide whether to approve the acquisition of, or increase in, control (the “FCA Assessment Period”). The FCA may approve an application unconditionally or subject to conditions or reject an application. If the FCA has not determined the application within the FCA Assessment Period then it is deemed to have approved the application. Acquiring or increasing control without the prior approval of the FCA is a criminal offence in the U.K. and the FCA can exercise a number of other powers where a person acquires or increases control without prior approval.

Perella Weinberg U.K. Limited is authorized and regulated by the FCA in the U.K. Consequently, any person acquiring or increasing control over Perella Weinberg U.K. Limited must obtain the prior approval of the FCA. The Business Combination is therefore subject to these requirements and may not be completed until the FCA has approved, or is deemed to have approved, the application to acquire control.

See the section entitled “Proposal No. 1—The Business Combination Proposal—Regulatory Matters” for more information.

Accounting Treatment

The Business Combination will be accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, FTIV, who is the legal acquirer, will be treated as the “acquired” company for financial reporting purposes and PWP will be treated as the accounting acquirer. This determination was primarily based on PWP expecting to have a majority of the voting power of the post-combination company, PWP’s senior management comprising substantially all of the senior management of the post-combination company, the relative size of PWP compared to FTIV, and PWP’s operations comprising the ongoing operations of the post-combination company. Accordingly, for accounting purposes, the Business Combination will be treated as the equivalent of a capital transaction in which PWP is issuing stock for the net assets of FTIV. The net assets of FTIV will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to Business Combination will be those of PWP.

Appraisal Rights

Appraisal rights are not available to our stockholders in connection with the Business Combination.

Reasons for the Business Combination

Our board of directors has unanimously approved the Business Combination Agreement and the transactions contemplated thereby, including the Business Combination, has determined that the Business Combination Agreement and the transactions contemplated thereby are fair to and in the best interests of the Company and our stockholders, and unanimously recommends that our stockholders vote “FOR” the Business Combination Proposal. For a description of the reasons considered by our board of directors in deciding to recommend adoption of the Business Combination Agreement, see the sections entitled “Proposal No. 1—The Business Combination Proposal—Reasons for the Approval of the Business Combination” and “Proposal No. 1—The Business Combination Proposal—Recommendation of the Board.”



 

39


Table of Contents

The Nasdaq Proposal

In connection with the Business Combination Proposal, and in order to allow us to complete the Business Combination, we are asking you to approve, for purposes of complying with Nasdaq Listing Rules 5635(a) and (b), the issuance of more than 20% of our issued and outstanding common stock and the resulting change of control in connection with the Business Combination. In addition, under Nasdaq Listing Rule 5635(d), prior stockholder approval is required for the issuance, other than in a public offering, of securities convertible into common stock at a price less than the greater of book or market value of the common stock if the securities are convertible into 20% or more of a company’s common stock, and we are therefore asking you to approve the issuance of our shares of common stock in connection with the PIPE Investment. See the section entitled “Proposal No. 2—The Nasdaq Proposal” for more information.

The Charter Proposals

In connection with the Business Combination Proposal, and in order to allow us to complete the Business Combination, we are asking you to approve five separate Charter Proposals to amend and restate our Existing Certificate of Incorporation (subject to the terms and provisions of the Stockholders Agreement) to:

 

  (i)

create an additional class of directors so that there will be three classes of directors with staggered terms of office, and make certain related changes;

 

  (ii)

provide that certain transactions are not “corporate opportunities” and that each of the partners, principals, directors, officers, members, managers, employees, consultants, independent contractors and/or other service providers of the Ownership Group are not subject to the doctrine of corporate opportunity, in each case, to the fullest extent permitted by law;

 

  (iii)

increase the number of authorized shares of our capital stock;

 

  (iv)

create additional classes of our common stock to be designated as Class B-1 common stock, having 10 votes per share, and Class B-2 common stock, having 1 vote per share; and

 

  (v)

provide for additional changes, principally including changing our name from “FinTech Acquisition Corp. IV” to “Perella Weinberg Partners” and removing provisions applicable to special purpose acquisition companies.

See the sections entitled “Proposal No. 3—The Charter Classified Board Proposal,” “Proposal No. 4—The Charter Corporate Opportunity Proposal,” “Proposal No. 5—The Authorized Capital Stock Proposal,” “Proposal No. 6—The Class B Stock Proposal” and “Proposal No. 7—The Charter Additional Amendments Proposal” for more information.

The Existing Director Election Proposal

We are asking you to consider and vote upon a proposal to elect Betsy Z. Cohen, Brittain Ezzes and Madelyn Antoncic to serve as Class I directors on our board of directors until the earlier of the Closing and the 2022 annual meeting of stockholders, and until their respective successors are duly elected and qualified or until their earlier resignation, removal or death. See the section entitled “Proposal No. 8—The Existing Director Election Proposal” for more information.



 

40


Table of Contents

The Business Combination Director Election Proposal

Each of the members of our board of directors intends to resign from our board of directors upon the Closing. We are asking you to consider and vote upon a proposal to elect, effective as of, and contingent upon, the Closing, Mr. Perella, Mr. Seidenberg and Mr. Cohen to serve as Class I directors, Mr. Ollila, Mr. Steel and Mr. Bednar to serve as Class II directors, and Mr. Weinberg, Ms. Sherburne and Mr. Becker to serve as Class III directors, on our board of directors in accordance with the proposed to-be-adopted Second Amended and Restated Certificate of Incorporation, until the 2022, 2023 and 2024 annual meeting of stockholders, respectively, and until their respective successors are duly elected and qualified or until their earlier resignation, removal or death. See the section entitled “Proposal No. 9—The Business Combination Director Election Proposal” for more information.

The Incentive Plan Proposal

Our proposed Incentive Plan will be effective upon the Closing, subject to approval by our stockholders at the Special Meeting. Assuming no redemptions, the proposed Incentive Plan will initially reserve 24.18 million shares of our common stock for issuance in accordance with the plan terms, of which (i) 13.98 million shares, equal to 15% of the sum of the total number of outstanding shares of our common stock (which excludes RSUs) and the total number of outstanding PWP OpCo units as of the Closing will be generally available for issuance under the plan for the duration of the plan term and subject to an annual evergreen feature (the “General Share Reserve”) and (ii) 10.2 million shares, equal to approximately 10% of the sum of the total number of outstanding shares of our common stock (including, for this purpose only, these 10.2 million shares) and the total number of outstanding PWP OpCo units as of the Closing will be available for one year following the completion of the Business Combination for grants to be made pursuant to a transaction pool of long-term incentive awards to be established in connection with the Closing (the “Transaction Pool Share Reserve”). If the actual facts are different than this assumption, then fewer shares of our common stock will be reserved for issuance pursuant to the General Share Reserve. In addition, any Management Awards (as described in “Executive Compensation—Other Executive Compensation Elements—Management Awards”) will be made out of the General Share Reserve and, as a result, fewer shares of our common stock will be available for future issuance pursuant to the General Share Reserve, subject to the annual evergreen feature. The Transaction Pool Share Reserve is fixed at 10.2 million shares. The purpose of the Incentive Plan is to provide eligible employees, directors and consultants the opportunity to receive stock-based incentive awards in order to encourage them to contribute materially to our growth and to align the economic interests of such persons with those of our stockholders. The summary of the Incentive Plan above is qualified in its entirety by reference to the complete text of the Incentive Plan, a copy of which is attached to this proxy statement as Annex H. You are encouraged to read the Incentive Plan in its entirety. See the section entitled “Proposal No. 10—The Incentive Plan Proposal” for more information.

The French Sub-Plan Proposal

Our proposed French Sub-Plan will be effective upon the Closing, subject to approval by our stockholders at the Special Meeting, and contingent upon approval by our stockholders of the Incentive Plan Proposal at the Special Meeting. Any shares of our common stock issued pursuant to the French Sub-Plan will reduce the shares of our common stock that will be reserved for issuance under the Incentive Plan. The purpose of the French Sub-Plan is to provide eligible recipients in France the opportunity to receive stock-based incentive awards in order to encourage them to contribute materially to our growth and to align the economic interests of such persons with those of our stockholders in a



 

41


Table of Contents

manner that qualifies for the favorable tax and social security regime available for share award plans in France. The summary of the French Sub-Plan above is qualified in its entirety by reference to the complete text of the French Sub-Plan, a copy of which is attached to this proxy statement as Annex I. You are encouraged to read the French Sub-Plan in its entirety. See the section entitled “Proposal No. 11—The French Sub-Plan Proposal” for more information.

The Adjournment Proposal

If there are insufficient votes for, or for any other reason in connection with, the approval of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposals, the Existing Director Election Proposal, the Business Combination Director Election Proposal, the Incentive Plan Proposal or the French Sub-Plan Proposal at the Special Meeting, the Adjournment Proposal allows us to adjourn the Special Meeting to a later date, if necessary, to permit further solicitation and vote of proxies. See the section entitled “Proposal No. 12—The Adjournment Proposal” for more information.

Quorum and Required Vote for Proposals for the Special Meeting

A quorum of our stockholders is necessary to hold a valid meeting. A quorum will be present at the Special Meeting if a majority of the shares of our common stock outstanding and entitled to vote at the Special Meeting is represented at the meeting by virtual attendance or by proxy. If a stockholder fails to vote his, her or its shares online during the Special Meeting or by proxy, or if a broker fails to vote online during the Special Meeting or by proxy shares held by it in nominee name, such shares will not be counted for the purposes of establishing a quorum. If a stockholder who holds his, her or its shares in “street name” through a bank, broker or other nominee fails to give voting instructions to such bank, broker or other nominee (a “broker non-vote”) on all of the proposals set forth in this proxy statement, such shares will not be counted for the purposes of establishing a quorum. An abstention from voting, shares represented at the Special Meeting by virtual attendance or by proxy but not voted on one or more proposals or the failure of a stockholder who holds his or her shares in “street name” through a bank, broker or other nominee to give voting instructions to such bank, broker or other nominee on one or more but less than all of the proposals set forth in this proxy statement (a “broker non-vote”) will each count as present for the purposes of establishing a quorum. As of the date of this proxy statement, our executive officers, directors and affiliates own approximately 26.9% of our outstanding shares of common stock. Our Sponsor has agreed to vote all of such shares in favor of the Business Combination Proposal and other proposals described in this proxy statement and presented at the Special Meeting.

The approval of each of the Business Combination Proposal and the Charter Proposals requires the affirmative vote of holders of a majority of the outstanding shares of our common stock entitled to vote thereon at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote online during the Special Meeting, an abstention from voting or a broker non-vote will each have the same effect as voting “AGAINST” the Business Combination Proposal and the Charter Proposals.

The approval of each of the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal requires the affirmative vote of holders of a majority of our outstanding shares of common stock present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting. Accordingly, a stockholder’s failure to vote by proxy or to vote online during the Special Meeting or an abstention from voting will each have the same effect as voting “AGAINST” such proposal, and a broker non-vote will have no effect on the vote for each proposal.



 

42


Table of Contents

The approval of the Nasdaq Proposal requires the affirmative vote of holders of a majority of the votes cast by holders of outstanding shares of common stock present in person virtually or represented by proxy and entitled to vote on at the Special Meeting. Accordingly, an abstention from voting or a broker non-vote will have no effect on the outcome of the Nasdaq Proposal.

In order to be elected as a director as described in the Existing Director Election Proposal or the Business Combination Director Election Proposal, a nominee must receive a plurality of all the votes of the shares present in person virtually or represented by proxy and entitled to vote thereon at the Special Meeting, which means that the nominees who receive the most votes are elected. Accordingly, a stockholder’s failure to vote online during the Special Meeting or by proxy, a broker non-vote or an abstention will have no effect on the outcome of the Existing Director Election Proposal and the Business Combination Director Election Proposal.

The Business Combination is conditioned on the approval of each of the following proposals, which we refer to collectively as the “Condition Precedent Proposals”: the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposals, the Business Combination Director Election Proposal, the Incentive Plan Proposal and the French Sub-Plan Proposal, at the Special Meeting. The Condition Precedent Proposals are cross-conditioned on the approval of each other. Neither the Existing Director Election Proposal nor the Adjournment Proposal is conditioned upon the approval of any other proposal. Each of these proposals is more fully described in this proxy statement, which each stockholder is encouraged to read carefully and in its entirety.

The Business Combination Proposal is conditioned on the approval of each of the Condition Precedent Proposals. It is important for you to note that if the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposals, the Existing Director Election Proposal, the Incentive Plan Proposal or the French Sub-Plan Proposal is not approved by our stockholders, and we and PWP do not waive the applicable closing condition under the Business Combination Agreement, then the Business Combination will not be consummated. If we do not consummate the Business Combination and fail to complete an initial business combination by September 29, 2022 (or if such date is extended at a duly called meeting of stockholders, such later date), we will be required to dissolve and liquidate our trust account by returning the then remaining funds in such account to the public stockholders.

Recommendation to the Company’s Stockholders

Our board of directors believes that each of the Business Combination Proposal, the Nasdaq Proposal, the Charter Proposals, the Existing Director Election Proposal, the Business Combination Director Election Proposal, the Incentive Plan Proposal, the French Sub-Plan Proposal and the Adjournment Proposal to be presented at the Special Meeting is in the best interests of FTIV and our stockholders and unanimously recommends that our stockholders vote “FOR” each of the proposals.

Interests of FTIV’s Directors and Officers in the Business Combination

When you consider the recommendation of our board of directors in favor of approval of the Business Combination, you should keep in mind that our board of directors and officers have interests in the Business Combination that are different from, or in addition to, your interests as a stockholder, including the following:

 

   

certain of our officers and directors, including Betsy Z. Cohen, Daniel G. Cohen, James J. McEntee, III, Laura S. Kohn, Jan Rock Zubrow, Madelyn Antoncic and Brittain Ezzes, have a direct or indirect economic interest in the Sponsor;



 

43


Table of Contents
   

the Sponsor will hold our common stock following the Business Combination, subject to lock-up agreements;

 

   

the Sponsor will hold placement warrants to purchase shares of our common stock following the Business Combination, subject to a 30-day lock-up period provided for in the lock-up agreements;

 

   

the Sponsor paid an aggregate of $6,125,000 for its founder shares, placement shares and placement warrants and that such securities are expected to have a significantly higher value at the time of the Business Combination and will have little or no value if we do not complete the Business Combination;

 

   

the Sponsor has waived its redemption rights with respect to their founder shares, placement shares and public shares in connection with the Business Combination, and has waived its redemption and liquidation rights with respect to its founder shares and placement shares if we are unable to complete a business combination by our Business Combination Outside Date (as defined in the Business Combination Agreement);

 

   

if we are unable to complete a business combination by our Business Combination Outside Date, Cohen Sponsor Interests IV, LLC, the manager of the Sponsor, will be liable to ensure that the proceeds in the trust account are not reduced by the claims of target businesses or claims of vendors or other entities to which we owe money for services rendered or contracted for or products sold to us, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the trust account, and excluding any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act;

 

   

the Sponsor has agreed to loan us funds in an amount up to $500,000 for working capital requirements and to finance transaction costs in connection with an initial business combination, and any amounts outstanding under this loan will not be repaid if we are unable to complete a business combination by our Business Combination Outside Date; and

 

   

the continued indemnification of our current directors and officers and the continuation of directors’ and officers’ liability insurance after the Business Combination.

At any time prior to the Special Meeting, during a period when they are not then aware of any material nonpublic information regarding us or our securities, the initial stockholders, our directors, officers and their respective affiliates may enter into agreements to purchase shares from institutional and other investors who vote, or indicate an intention to vote, against the Business Combination Proposal or enter into transactions with such investors and others to provide them with incentives to acquire shares of our common stock or vote their shares in favor of the Business Combination Proposal. While the exact nature of any other incentive arrangements that may be entered into in the future has not been determined as of the date of this proxy statement, they might include, without limitation, arrangements to protect such investors or holders against potential loss in value of their shares, including the granting of put options and the transfer to such investors or holders of shares owned by the initial stockholders for nominal value.

The purpose of such purchases and other transactions would be to increase the likelihood that the Business Combination Proposal is approved and to decrease the likelihood that holders request redemption of public shares. Entering into any such arrangements may have a depressive effect on the price of our common stock. For example, if as a result of these arrangements an investor or holder purchases shares for nominal value, the investor or holder may be more likely to sell such shares immediately following the Closing for a price below market value.



 

44


Table of Contents

If our initial stockholders, directors, officers or their respective affiliates effect any purchases of our common stock, such purchases may cause the Business Combination Proposal or any of the Condition Precedent Proposals to be approved in circumstances where such approval could not otherwise be obtained. Purchases of shares by the persons described above would allow them to exert disproportionate influence over the approval of the Business Combination Proposal and other proposals to be presented at the Special Meeting and would likely increase the chances that such proposals would be approved.

As of the date of this proxy statement, no such agreements to sell or purchase shares prior to the record date have been entered into with any such investor or holder. We will file a Current Report on Form 8-K to disclose any material arrangements entered into or significant purchases made by any of the aforementioned persons that are not described in this proxy statement and that would affect the vote on the Business Combination Proposal.

Our independent directors reviewed and considered these interests during their evaluation of the Business Combination and in unanimously approving, as members of the board, the Business Combination Agreement and the transactions contemplated therein, including the Business Combination. The board concluded that the potential benefits that it expected us and our stockholders to achieve as a result of the Business Combination outweighed the potentially negative factors associated with the Business Combination. Accordingly, the board unanimously determined that the Business Combination Agreement and the transactions contemplated thereby, including the Business Combination, were advisable, fair to, and in our and our stockholders’ best interests.

See the section entitled “Certain Relationships and Related Persons Transactions—FTIV’s Related Party Transactions” for more information.

Interests of PWP Directors and Officers in the Business Combination

When you consider the recommendation of our board of directors in favor of approval of the Business Combination Proposal, you should keep in mind that PWP’s directors and executive officers may have interests in such proposal that are different from, or in addition to, your interests as a stockholder. See the section entitled “Proposal No. 1—The Business Combination Proposal—Interests of PWP Directors and Officers in the Business Combination” for more information.

Risk Factors

In evaluating the proposals set forth in this proxy statement, whether or not you plan to participate in the virtual Special Meeting, we urge you to read this proxy statement (including the Annexes) carefully, including the section entitled “Risk Factors” beginning on page 56.



 

45


Table of Contents

SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION OF FTIV

The following table sets forth selected historical financial information derived from FTIV’s audited financial statements as of and for the years ended December 31, 2020 and 2019, which are included elsewhere in this proxy statement, and FTIV’s audited financial statements for the period from November 20, 2018 (inception) through December 31, 2018, which is not included in this proxy statement.

The historical results presented below are not necessarily indicative of the results to be expected for any future period. You should carefully read the following selected financial information in conjunction with the section entitled “FTIV Management’s Discussion and Analysis of Financial Condition and Results of Operations” and FTIV’s financial statements and the related notes appearing elsewhere in this proxy statement.

 

    Year
Ended
December 31,
2020
    Year
Ended
December 31,
2019
    For the
Period from
November 20,
2018
(inception)
Through
December 31,
2018
 

Statement of Operations Data:

     

Operating expenses

  $ 1,025,138     $ 1,319     $ 977  
 

 

 

   

 

 

   

 

 

 

Loss from operations

    (1,025,138     (1,319     (977

Other income

     

Interest income on marketable securities

    5,681              

Provision for income taxes

                 
 

 

 

   

 

 

   

 

 

 

Net income (loss)

  $ (1,019,277   $ (1,319   $ (977
 

 

 

   

 

 

   

 

 

 

Basic and diluted net (loss) income per share, Class A

  $ 0.00     $ 0.00     $ 0.00  

Weighted average shares outstanding, of Class A redeemable common stock

    23,000,000              

Basic and diluted net (loss) income per share, Class A and Class B

  $ 0.14     $ 0.00     $ 0.00  

Weighted average shares outstanding, of Class A and Class B non-redeemable common stock

    7,280,219       6,870,000       6,870,000  

Balance Sheet Data:

     

Cash

  $ 1,158,934     $ 10,762     $  

Cash and marketable securities held in trust account

  $ 230,005,861     $     $  

Total assets

  $ 231,440,619     $ 65,635     $ 172  

Common stock subject to possible redemption

  $ 215,847,631     $     $  

Total stockholders’ equity

  $ 5,000,005     $ 22,704     $ (977


 

46


Table of Contents

SELECTED HISTORICAL FINANCIAL AND OTHER INFORMATION OF PWP

The selected historical financial and operating data of PWP is presented below as of the dates and for the periods indicated. The statements of operations data for the years ended December 31, 2020, 2019 and 2018 and the statements of financial condition data as of December 31, 2020 and 2019 have been derived from PWP’s audited historical consolidated financial statements included elsewhere in this proxy statement. The statement of operations data for the year ended December 31, 2017 and the statements of financial condition data as of December 31, 2018 and 2017 have been derived from PWP’s audited historical consolidated financial statements not included in this proxy statement.

PWP’s results for the years ended December 31, 2020, 2019, 2018 and 2017 and quarterly revenue information presented herein are not necessarily indicative of the results to be expected for any future periods.

The following selected financial and other data should be read together with “PWP Management’s Discussion and Analysis of Financial Condition and Results of Operations” and PWP’s historical consolidated financial statements and related notes included elsewhere in this proxy statement.

 

     Year Ended December 31,  
     2020     2019     2018     2017  
     ($ in thousands)  

Statement of Operations Data

        

Revenues(1)(2)

   $ 518,986     $ 533,297     $ 701,989     $ 418,443  

Expenses

        

Compensation and benefits

     374,332       349,819       477,606       279,055  

Equity-based compensation

     24,815       193,299       199,052       206,849  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total compensation and benefits

     399,147       543,118       676,658       485,904  

Non-compensation expenses

     134,435       145,298       132,748       106,442  

Total operating expenses

     533,582       688,416       809,406       592,346  

Operating income (loss)

     (14,596     (155,119     (107,417     (173,903

Non-operating income (expenses)

        

Related party revenues

     9,263       8,810              

Other income (expense)

     185       108       (634     (1,796

Interest expense

     (15,741     (15,395     (15,164     (15,429
  

 

 

   

 

 

   

 

 

   

 

 

 

Total non-operating income (expenses)

     (6,293     (6,477     (15,798     (17,225

Loss before income taxes

     (20,889     (161,596     (123,215     (191,128

Income tax benefit (expense)

     (3,453     (2,423     (2,542     646  
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

   $ (24,342   $ (164,019   $ (125,757   $ (190,482
  

 

 

   

 

 

   

 

 

   

 

 

 

Statement of Financial Condition Data (period end)

        

Total assets

   $ 542,953     $ 524,845     $ 616,855     $ 391,610  

Debt, net of unamortized debt discounts and issuance costs

     146,965       153,001       139,615       136,389  

Total liabilities

     468,770       442,940       524,336       346,222  

Total equity

     74,183       81,905       92,519       45,388  

Other Data and Metrics

        

Advisory professionals at period-end

     395       402       371       347  

Advisory Partners at period-end

     54       54       46       43  

Number of fee-paying clients during the period

     175       179       197       187  

Number of fee-paying clients $1 million or more during the period

     99       100       105       94  

Percentage of total revenues from top 10 transactions during the period

     33     39     37     32


 

47


Table of Contents

 

(1)

PWP OpCo was formed on November 30, 2016 in conjunction with a business combination (the “TPH Business Combination”) between NoCo A L.P., together with certain of its related entities, and Tudor, Pickering, Holt & Co., LLC (“TPH”). The results of the advisory business acquired in the TPH Business Combination are included in PWP’s consolidated financial results from November 30, 2016, the date of acquisition.

(2)

PWP’s revenues were $260.3 million, $356.1 million and $433.4 million for the years ended December 31, 2016, 2015 and 2014, respectively. These amounts were derived by combining the revenues in the audited financial statements of each of our broker-dealers (including TPH) for the 2016, 2015 and 2014 fiscal years, respectively, which are not included in this proxy statement.

 

     Year Ended December 31,  
     2020      2019      2018      2017  
     ($ in thousands)  

Advisory fees

   $ 511,251      $ 524,126      $ 684,945      $ 409,284  

Reimbursed expenses(1)

     6,461        6,729        7,258        7,759  

Co-advisor advisory fees(2)

     1,274        2,442        9,786        1,400  
  

 

 

    

 

 

    

 

 

    

 

 

 

Revenues

   $ 518,986      $ 533,297      $ 701,989      $ 418,443  
  

 

 

    

 

 

    

 

 

    

 

 

 

 

(1)

Reimbursed expenses include amounts reimbursed by PWP clients for collection of expenses.

(2)

Co-advisor advisory fees include amounts reimbursed by PWP’s clients for professional fees pursuant to certain co-advisory engagements incurred on their behalf. Certain of PWP’s advisory engagements are structured as co-advisory engagements whereby another company earns fees for providing advisory services to the client as well. In certain of these cases there is a single engagement letter whereby we are principal with the client and then separately contract with the co-advisor.

 

    Revenue by Quarter(1)  
    December 31,
2020
    September 30,
2020
    June 30,
2020
    March 31,
2020
    December 31,
2019
    September 30,
2019
    June 30,
2019
    March 31,
2019
 
    ($ in thousands)  

Revenues

  $ 189,145     $ 122,844     $ 114,601     $ 92,396     $ 171,881     $ 169,795     $ 91,521     $ 100,100  

 

(1)

Revenue information for each of the quarters in the years ended December 31, 2020 and 2019, have been derived from the books and records of PWP. Such quarterly revenue information has not been audited or reviewed in accordance with US generally accepted auditing standards.

Non-GAAP Financial Measures

In addition to financial measures presented in accordance with United States generally accepted accounting principles (“GAAP”), PWP monitors Adjusted total compensation and benefits, Adjusted non-compensation expense, Adjusted operating income (loss), Adjusted income (loss) before income taxes and Adjusted net income (loss), each of which is a non-GAAP measure, to manage its business, make planning decisions, evaluate its performance and allocate resources.

 

   

PWP defines “Adjusted total compensation and benefits” as total compensation and benefits excluding (i) equity-based compensation related to Professional Partners ownership which is not dilutive to investors in PWP or PWP OpCo, (ii) transaction-related compensation associated with initial public offering preparation and, prospectively, (iii) transaction-related compensation associated with the Business Combination.

 



 

48


Table of Contents
   

PWP defines “Adjusted non-compensation expense” as non-compensation expense excluding (i) TPH Business Combination related expenses, (ii) expenses related to the PWP Separation, (iii) delayed offering cost expense and (iv) prospectively, transaction-related non-compensation expenses associated with the Business Combination.

 

   

PWP defines “Adjusted operating income (loss)” as operating income (loss) excluding (i) equity-based compensation related to Professional Partners ownership which is not dilutive to investors in PWP or PWP OpCo, (ii) transaction-related compensation associated with initial public offering preparation, (iii) TPH Business Combination related expenses, (iv) expenses related to the PWP Separation, (v) delayed offering cost expense and, prospectively, (vi) transaction-related compensation and non-compensation expenses associated with the Business Combination.

 

   

PWP defines “Adjusted income (loss) before income taxes” as income (loss) excluding income taxes before (i) equity-based compensation related to Professional Partners ownership which is not dilutive to investors in PWP or PWP OpCo, (ii) transaction-related compensation associated with initial public offering preparation, (iii) TPH Business Combination related expenses, (iv) expenses related to the PWP Separation, (v) delayed offering cost expense, (vi) amortization of debt costs, and, prospectively, (vii) transaction-related compensation and non-compensation-related expenses associated with the Business Combination.

 

   

PWP defines “Adjusted net income (loss)” as net income (loss) excluding after tax amounts for (i) equity-based compensation related to Professional Partners ownership which is not dilutive to investors in PWP or PWP OpCo, (ii) transaction-related compensation associated with initial public offering preparation, (iii) TPH Business Combination related expenses, (iv) expenses related to the PWP Separation, (v) delayed offering cost expense, (vi) amortization of debt costs, and, prospectively, (vii) transaction-related compensation associated with the Business Combination.

PWP believes that these non-GAAP financial measures are key financial indicators of its business performance over the long term and provide useful information regarding whether cash provided by operating activities is sufficient to maintain and grow PWP’s business. We believe that the methodology for determining these non-GAAP financial measures can provide useful supplemental information to help investors better understand the economics of its platform.

These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation from, or as a substitute for, the analysis of other GAAP financial measures, including total compensation and benefits, non-compensation expense, operating income (loss), income (loss) before taxes and net income (loss). These non-GAAP financial measures are not universally consistent calculations, limiting their usefulness as comparative measures. Other companies may calculate similarly titled financial measures differently. Additionally, these non-GAAP financial measures are not measurements of financial performance or liquidity under GAAP. In order to facilitate a clear understanding of PWP’s consolidated historical operating results, you should examine PWP’s non-GAAP financial measures in conjunction with PWP’s historical consolidated financial statements and notes thereto included elsewhere in this proxy statement.

Management compensates for the inherent limitations associated with using these non-GAAP financial measures through disclosure of such limitations, presentation of PWP’s financial statements in accordance with GAAP and reconciliation of such non-GAAP financial measures to the most directly comparable GAAP financial measure, as presented below. For additional information regarding PWP’s non-GAAP financial measures see “PWP Management’s Discussion and Analysis of Financial Condition and Results of Operation—Non-GAAP Financial Measures.



 

49


Table of Contents
    GAAP     Adjusted (non-GAAP)  
    Year Ended December 31,  
    2020     2019     2018     2017     2020     2019     2018     2017  
    ($ in thousands)  

Total compensation and benefits(1)

  $ 399,147     $ 543,118     $ 676,658     $ 485,904     $ 365,618     $ 349,224     $ 468,140     $ 279,055  

Non-compensation expense(2)

  $ 134,435     $ 145,298     $ 132,748     $ 106,442     $ 113,024     $ 134,561     $ 126,168     $ 99,255  

Operating income (loss)(3)

  $ (14,596   $ (155,119   $ (107,417   $ (173,903   $ 40,344     $ 49,512     $ 107,681     $ 40,133  

Income (loss) before income taxes(4)

  $ (20,889   $ (161,596   $ (123,215   $ (191,128   $ 38,015     $ 46,670     $ 95,166     $ 25,915  

Net income (loss)(4)(5)

  $ (24,342   $ (164,019   $ (125,757   $ (190,482   $ 34,562     $ 44,247     $ 92,624     $ 26,561  

 

(1)

Reflects adjustments to remove $33.5 million, $193.9 million, $208.5 million and $206.8 million for the years ended December 31, 2020, 2019, 2018 and 2017, respectively, in the Adjusted non-GAAP presentation, for equity-based compensation which includes amortization of equity awards for Professional Partners ownership which is not dilutive to investors in PWP or PWP OpCo and public company transaction related incentives related to milestone events which were outside of the normal and recurring bonus process.

(2)

Reflects adjustments to remove $21.4 million, $10.7 million, $6.6 million and $7.2 million for the years ended December 31, 2020, 2019, 2018 and 2017, respectively, in the Adjusted non-GAAP presentation, for certain non-compensation expenses including business combination related expenses associated with the TPH Business Combination, expenses associated with the master separation agreement and the PWP Separation and delayed offering cost expense.

(3)

Reflects adjustments to remove $54.9 million, $204.6 million, $215.1 million and $214.0 million for the years ended December 31, 2020, 2019, 2018 and 2017, respectively, in the Adjusted non-GAAP presentation, for the items noted in (1) and (2) above.

(4)

Reflects adjustments to remove $58.9 million, $208.3 million, $218.4 million and $217.0 million for the years ended December 31, 2020, 2019, 2018 and 2017, respectively, in the Adjusted non-GAAP presentation, for the items noted in (1) and (2) above as well as amortization of debt costs composed of the amortization of debt discounts and issuance costs which is included in interest expense.

(5)

There is no significant income tax impact from these adjustments.

 

     Year Ended
December 31,
 
     2020     2019     2018     2017  
     ($ in thousands)  

Total compensation and benefits—GAAP

   $ 399,147     $ 543,118     $ 676,658     $ 485,904  

Equity-based compensation not dilutive to investors in PWP or PWP OpCo(1)

     (24,815     (193,299     (199,052     (206,849

Public company transaction related incentives(2)

     (8,714     (595     (9,466      

Adjusted total compensation and benefits

   $ 365,618     $ 349,224     $ 468,140     $ 279,055  
  

 

 

   

 

 

   

 

 

   

 

 

 


 

50


Table of Contents
     Year Ended
December 31,
 
     2020     2019     2018     2017  
     ($ in thousands)  

Non-compensation expense—GAAP

   $ 134,435     $ 145,298     $ 132,748     $ 106,442  

TPH Business Combination related expenses(3)

     (6,580     (6,580     (6,580     (7,187

Business separation related expenses(4)

           (4,157            

Delayed offering cost expense(5)

     (14,831                  

Adjusted non-compensation expense(7)

   $ 113,024     $ 134,561     $ 126,168     $ 99,255  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

     Year Ended
December 31,
 
     2020     2019     2018     2017  
     ($ in thousands)  

Operating loss—GAAP

   $ (14,596   $ (155,119   $ (107,417   $ (173,903

Equity-based compensation not dilutive to investors in PWP or PWP OpCo(1)

     24,815       193,299       199,052       206,849  

Public company transaction related incentives(2)

     8,714       595       9,466        

TPH Business Combination related expenses(3)

     6,580       6,580       6,580       7,187  

Business separation related expenses(4)

           4,157              

Delayed offering cost expense(5)

     14,831                    

Adjusted operating income (loss)

   $ 40,344     $ 49,512     $ 107,681     $ 40,133  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

     Year Ended
December 31,
 
     2020     2019     2018     2017  
     ($ in thousands)  

Non-operating income/(expense) —GAAP

   $ (6,293   $ (6,477   $ (15,798   $ (17,225

Amortization of debt costs(6)

     3,964       3,635       3,283       3,007  

Adjusted non-operating income/(expense)

   $ (2,329   $ (2,842   $ (12,515   $ (14,218
  

 

 

   

 

 

   

 

 

   

 

 

 

 

     Year Ended
December 31,
 
     2020     2019     2018     2017  
     ($ in thousands)  

Loss before income taxes—GAAP

   $ (20,889   $ (161,596   $ (123,215   $ (191,128

Equity-based compensation not dilutive to investors in PWP or PWP OpCo(1)

     24,815       193,299       199,052       206,849  

Public company transaction related incentives(2)

     8,714       595       9,466        

TPH Business Combination related expenses(3)

     6,580       6,580       6,580       7,187  

Business separation related expenses(4)

           4,157              

Delayed offering cost expense(5)

     14,831                    

Amortization of debt costs(6)

     3,964       3,635       3,283       3,007  

Adjusted income (loss) before income taxes

   $ 38,015     $ 46,670     $ 95,166     $ 25,915  
  

 

 

   

 

 

   

 

 

   

 

 

 


 

51


Table of Contents
     Year Ended December 31,  
         2020         2019     2018     2017  
     ($ in thousands)  

Income tax benefit (expense)—GAAP

   $ (3,453   $ (2,423   $ (2,542   $ 646  

Equity-based compensation not dilutive to investors in PWP or PWP OpCo(1)

                        

Public company transaction related incentives(2)

                        

TPH Business Combination related expenses(3)

                        

Business separation related expenses(4)

                        

Delayed offering cost expense(5)

                        

Amortization of debt costs(6)

                        

Adjusted Income tax benefit (expense)

   $ (3,453   $ (2,423   $ (2,542   $ 646  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

     Year Ended December 31,  
     2020     2019     2018     2017  
     ($ in thousands)  

Net loss—GAAP

   $ (24,342   $ (164,019   $ (125,757   $ (190,482

Equity-based compensation not dilutive to investors in PWP or PWP OpCo(1)

     24,815       193,299       199,052       206,849  

Public company transaction related incentives(2)

     8,714       595       9,466        

TPH Business Combination related expenses(3)

     6,580       6,580       6,580       7,187  

Business separation related expenses(4)

           4,157              

Delayed offering cost expense(5)

     14,831                    

Amortization of debt costs(6)

     3,964       3,635       3,283       3,007  

Adjusted net income (loss)(8)

   $ 34,562     $ 44,247     $ 92,624     $ 26,561  
  

 

 

   

 

 

   

 

 

   

 

Notes to GAAP Reconciliation of Adjusted Results:

 

(1)

Equity-based compensation not dilutive to investors includes amortization of equity awards relating to the re-vesting of certain partnership interests in connection with the 2016 TPH Business Combination and annual grants to certain partners.

(2)

Public company transaction related incentives represents discretionary bonus payments directly related to milestone events that are part of the proposed FTIV Business Combination process and reorganization. These payments were outside of PWP’s normal and recurring bonus and compensation processes.

(3)

TPH Business Combination related expenses include charges associated with the TPH Business Combination such as intangible asset amortization, and in 2017, lease cancellation costs.

(4)

Business separation related expenses include charges associated with the PWP Separation.

(5)

Previously deferred offering costs that were expensed due to termination of the public company transaction process in May of 2020.

(6)

Amortization of debt costs is composed of the amortization of debt discounts and issuance costs which is included in interest expense.

(7)

See reconciliation below for the components of the consolidated statements of operations and comprehensive loss included in non-compensation expense—GAAP as well as Adjusted non-compensation expense.

(8)

There is no significant income tax impact of the adjustments shown to these GAAP financial statement line items.

 



 

52


Table of Contents
     Year Ended December 31, 2020  
         GAAP          Adjustments     Adjusted  
     ($ in thousands)  

Professional fees

   $ 42,880      $ (14,831 )(a)    $ 28,049  

Technology and infrastructure

     27,281        —         27,281  

Rent and occupancy

     27,958        —         27,958  

Travel and related expenses

     5,725        —         5,725  

General, administrative and other expenses

     15,060        —         15,060  

Depreciation and amortization

     15,531        (6,580 )(b)      8,951  

Non-compensation expense

   $ 134,435      $ (21,411   $ 113,024  
  

 

 

    

 

 

   

 

 

 

 

     Year Ended December 31, 2019  
     GAAP      Adjustments     Adjusted  
     ($ in thousands)  

Professional fees

   $ 39,265        (4,157 )(c)    $ 35,108  

Technology and infrastructure

     27,070        —         27,070  

Rent and occupancy

     27,802        —         27,802  

Travel and related expenses

     19,656        —         19,656  

General, administrative and other expenses

     15,653        —         15,653  

Depreciation and amortization

     15,852        (6,580 )(b)      9,272  

Non-compensation expense

   $ 145,298      $ (10,737   $ 134,561  
  

 

 

    

 

 

   

 

 

 

 

     Year Ended December 31, 2018  
     GAAP      Adjustments     Adjusted  
     ($ in thousands)  

Professional fees

   $ 37,118        —       $ 37,118  

Technology and infrastructure

     22,977        —         22,977  

Rent and occupancy

     20,922        —         20,922  

Travel and related expenses

     19,286        —         19,286  

General, administrative and other expenses

     16,130        —         16,130  

Depreciation and amortization

     16,315        (6,580 )(b)      9,735  

Non-compensation expense

   $ 132,748      $ (6,580   $ 126,168  
  

 

 

    

 

 

   

 

 

 

 

     Year Ended December 31, 2017  
     GAAP      Adjustments     Adjusted  
     ($ in thousands)  

Professional fees

   $ 20,160        —       $ 20,160  

Technology and infrastructure

     22,808        —         22,808  

Rent and occupancy

     20,217        —         20,217  

Travel and related expenses

     17,123        —         17,123  

General, administrative and other expenses

     9,633        (607 )(d)      9,026  

Depreciation and amortization

     16,501        (6,580 )(b)      9,921  

Non-compensation expense

   $ 106,442      $ (7,187   $ 99,255  
  

 

 

    

 

 

   

 

 

 

 

(a)

Reflects an adjustment to exclude previously deferred offering costs that were expensed due to termination of the public company transaction process in May of 2020.

(b)

Reflects an adjustment to exclude the amortization of intangible assets related to the TPH Business Combination.

(c)

Reflects an adjustment to remove business separation related expenses including charges associated with the PWP Separation.

(d)

Reflects an adjustment to remove the charge to cancel TPH’s New York lease as a result of the TPH Business Combination.



 

53


Table of Contents

SELECTED UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

The selected unaudited pro forma condensed combined financial information is presented for informational purposes only. The selected pro forma condensed combined financial information does not purport to represent what the combined company’s results of operations or financial condition would have been had the Business Combination and other transactions actually occurred on December 31, 2020 with respect to the selected unaudited pro forma condensed combined statement of financial condition and January 1, 2020 with respect to the selected unaudited pro forma condensed combined statements of operations and does not purport to project the combined company’s results of operations or financial condition for any future period or as of any future date. The information below should be read in conjunction with “Unaudited Pro Forma Condensed Combined Financial Information” included elsewhere in this proxy statement.

 

     Year Ended December 31, 2020  
     Combined Pro Forma  
     Assuming No
Redemptions
    Assuming
Maximum
Redemptions
 
     (in thousands, except share
and per share data)
 

Selected Unaudited Pro Forma Condensed Combined Statement of Operations Data

    

Revenues

   $ 518,986     $ 518,986  

Net Income (loss)

   $ (147,012   $ (147,379

Net income (loss) attributable to noncontrolling interest

   $ (109,743   $ (120,449

Net income (loss) attributable to Perella Weinberg Partners

   $ (37,269   $ (26,930

Net income (loss) per Class A share:

    

Class A common stock—basic

   $ (0.84   $ (0.93

Class A common stock—diluted

   $ (1.26   $ (1.30

Weighted average shares outstanding, basic and diluted:

    

Class A common stock—basic

     44,397,613       28,897,422  

Class A common stock—diluted

     94,634,190       89,957,422  

 

     December 31, 2020  
     Combined Pro Forma  
     Assuming No
Redemptions
     Assuming
Maximum
Redemptions
 
     (in thousands)  

Selected Unaudited Pro Forma Condensed Combined Statement of Financial Condition Data

     

Total assets

   $ 578,622      $ 505,721  

Total liabilities

   $ 362,662      $ 339,963  

Total equity

   $ 215,960      $ 165,758  

Noncontrolling interest

   $ 115,017      $ 115,065  


 

54


Table of Contents

COMPARATIVE PER SHARE INFORMATION

The following table sets forth selected historical equity ownership information for FTIV and unaudited pro forma condensed consolidated combined per share ownership information of FTIV after giving effect to the business combination, assuming two redemption scenarios as follows:

 

   

Assuming No Redemptions:    This scenario assumes that no shares of FTIV are redeemed from the public stockholders (the “No Redemptions Scenario”).

 

   

Assuming Maximum Redemptions:    This scenario assumes that approximately 15.5 million shares of FTIV are redeemed, resulting in an aggregate payment of approximately $155.0 million out of the trust account. This redemption is the maximum allowable redemption whereby FTIV believes it will be able to satisfy the conditions in the Business Combination Agreement, including the condition that the Available Funds shall not be less than $200.0 million (the “Maximum Redemptions Scenario”).

The pro forma book value and net income (loss) per share information reflects the Business Combination and related transactions as if they had occurred on December 31, 2020 and January 1, 2020, respectively.

The historical information should be read in conjunction with the sections entitled “Selected Historical Consolidated Financial Information of FTIV” and “Selected Historical Financial Information of PWP” and the historical consolidated and combined financial statements of FTIV and PWP, respectively, and the related notes thereto included elsewhere in this proxy statement. The unaudited pro forma condensed consolidated combined per share data are presented for illustrative purposes only and are not necessarily indicative of actual or future financial position or results of operations that would have been realized if the Business Combination and related transactions had been completed as of the date indicated or will be realized upon the completion of the Business Combination and related transactions.

 

     PWP      FTIV     Pro Forma
Combined
Assuming No
Redemptions
    Pro Forma
Combined
Assuming
Maximum
Redemptions
 

Book value per share(1)

   $      $ 0.20     $ 2.28     $ 1.84  

Basic net income (loss) per Class A common share, December 31, 2020

   $      $ (0.00   $ (0.84   $ (0.93

Diluted net income (loss) per Class A common share, December 31, 2020

   $      $ (0.00   $ (1.26   $ (1.30

Weighted average shares outstanding—basic, December 31, 2020

            23,000,000       44,397,613       28,897,422  

Weighted average shares outstanding—diluted, December 31, 2020

            23,000,000       94,634,190       89,957,422  

 

(1)

Book value per share equals total equity divided by weighted average Class A common stock outstanding – diluted.



 

55


Table of Contents

RISK FACTORS

You should carefully review and consider the following risk factors and the other information contained in this proxy statement, including the Annexes and the accompanying financial statements of the Company and PWP, in evaluating the Business Combination and the proposals to be voted on at the Special Meeting. You should carefully consider the following risk factors in addition to the other information included in this proxy statement, including matters addressed in the section entitled “Cautionary Note Regarding Forward-Looking Statements.” We or PWP may face additional risks and uncertainties that are not presently known to us or PWP, or that we or PWP currently deems immaterial, which may also impair our or PWP’s business or financial condition.

Summary Risk Factors

The following is a summary of some of the risks and uncertainties that could materially adversely affect our business, financial condition and results of operations. You should read this summary together with the more detailed description of each risk factor contained below.

Risks Related to the Business of PWP

 

   

The scale, scope and duration of the impact of the COVID-19 pandemic on PWP’s business is unpredictable and depends on a number of factors outside of PWP’s control. PWP cannot reasonably predict the magnitude of the ultimate impact that COVID-19 will have on it and whether the impact may have a sustained adverse effect on PWP’s business, revenues, operating results and financial condition.

 

   

PWP’s future growth will depend on, among other things, its ability to successfully identify, recruit and develop talent and will require PWP to commit additional resources.

 

   

PWP’s inability to successfully identify, consummate and integrate strategic transactions such as joint ventures, strategic investments and acquisitions may result in additional risks and uncertainties in its business.

 

   

Changing market conditions can adversely affect PWP’s business in many ways, including by reducing the volume of the transactions involving PWP’s business, which could materially reduce its revenue.

 

   

PWP’s revenue in any given period is dependent on the number of fee-paying clients in such period, and a significant reduction in the number of fee-paying clients in any given period could reduce PWP’s revenue and adversely affect its operating results in such period.

 

   

PWP has recorded operating losses in the past and may experience operating losses in the future.

 

   

PWP’s ability to retain Working Partners and key employees is critical to the success of its business.

 

   

Substantially all of PWP’s revenue is derived from advisory fees, including fees that are largely contingent upon the completion of events which may be out of its control, such as the completion of a transaction and, as a result, PWP’s revenue and profits are highly volatile on a quarterly basis.

 

   

PWP’s engagements are often singular in nature and do not provide for subsequent engagements, which could cause its revenues to fluctuate materially from period to period.

 

   

PWP’s clients may be unable to pay PWP for its services.

 

   

If the number of debt defaults, bankruptcies or other factors affecting demand for PWP’s recapitalization and restructuring advisory services declines, PWP’s recapitalization and restructuring business could suffer.

 

56


Table of Contents
   

PWP’s failure to deal appropriately with actual, potential or perceived conflicts of interest could damage its reputation and materially adversely affect its business.

 

   

Employee misconduct, which is difficult to detect and deter, and other labor-related issues could harm PWP by impairing its ability to attract and retain clients and by subjecting PWP to legal liability and reputational harm.

 

   

PWP faces strong competition from other financial advisory firms, many of which have the ability to offer clients a wider range of products and services than those PWP can offer, which could cause PWP to lose engagements to competitors, fail to win advisory mandates and subject PWP to pricing pressures that could materially adversely affect its revenue and profitability.

 

   

PWP may be subject to restrictions in a credit agreement governing a revolving credit facility, which may impair its ability to finance its future operations or capital needs or engage in other business activities that may be in its interests.

Risks Related to Perella Weinberg Partners’ Organizational Structure

 

   

Perella Weinberg Partners’ only material assets after the completion of the Business Combination will be its partnership interests in PWP OpCo and its equity interest in the general partner of PWP OpCo, PWP GP, and Perella Weinberg Partners is accordingly dependent upon distributions from PWP OpCo to pay dividends, taxes, payments under the Tax Receivable Agreement and pay other expenses.

 

   

Under the Tax Receivable Agreement, Perella Weinberg Partners will be required to pay its ILPs and/or its Limited Partners for certain tax benefits it may claim as a result of the tax basis step-up Perella Weinberg Partners receives in connection with the Business Combination and related transactions, including subsequent exchanges of PWP OpCo Class A partnership units for cash or Perella Weinberg Partners Class A common stock, and as a result of payments under the Tax Receivable Agreement. In certain circumstances, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual tax benefits Perella Weinberg Partners realizes.

 

   

PWP OpCo may make distributions of cash to Perella Weinberg Partners substantially in excess of the amounts Perella Weinberg Partners uses to make distributions to its shareholders and to pay its expenses (including its taxes and payments under the Tax Receivable Agreement). To the extent Perella Weinberg Partners does not distribute such excess cash as dividends on Perella Weinberg Partners Class A common stock, the holders of PWP OpCo Class A partnership units would benefit from any value attributable to such cash as a result of their ownership of Perella Weinberg Partners Class A common stock or receipt of equivalent cash amount upon a redemption or exchange of their Class A partnership units.

 

   

If Perella Weinberg Partners were deemed an “investment company” under the Investment Company Act of 1940 as a result of its ownership of PWP OpCo, applicable restrictions could make it impractical for Perella Weinberg Partners to continue our business as contemplated and could have a material adverse effect on its business.

 

   

PWP OpCo and PWP Capital Holdings LP, a Delaware limited partnership (“PWP Capital”) have entered into various arrangements, including a master separation agreement, which contain cross-indemnification obligations of Perella Weinberg Partners and PWP Capital.

 

   

Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation could prevent it from benefiting from corporate opportunities that might have otherwise been available to it.

 

57


Table of Contents
   

If PWP OpCo were to become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes, Perella Weinberg Partners and PWP OpCo could be subject to potentially significant tax inefficiencies, and Perella Weinberg Partners would not be able to recover payments previously made by it under the Tax Receivable Agreement even if the corresponding tax benefits were subsequently determined to have been unavailable due to such status.

 

   

The use of certain of Perella Weinberg Partners’ licensed trademarks by PWP Capital and its subsidiaries may expose Perella Weinberg Partners to reputational harm that could adversely affect its business should they take actions that damage the brand name.

Risks Related to FTIV and the Business Combination

 

   

Our initial stockholders, directors and officers may have a conflict of interest in determining to pursue our business combination with PWP, since certain of their interests are different from or in addition to (and may conflict with) the interests of our public stockholders, and such interests may have influenced their decisions to approve the Business Combination and recommend that our stockholders approve the Business Combination Proposal.

 

   

Neither the FTIV board of directors nor any committee thereof obtained a third party valuation in determining whether or not to pursue the Business Combination.

 

   

Nasdaq may not list our securities on its exchange, and, if they are listed, we may be unable to satisfy listing requirements in the future, which could limit investors’ ability to effect transactions in our securities and subject us to additional trading restrictions.

 

   

We will incur significant costs and obligations as a result of being a public company.

 

   

As an “emerging growth company,” we cannot be certain if the reduced disclosure requirements applicable to “emerging growth companies” will make our common stock less attractive to investors.

 

   

We may issue additional shares of common stock or other equity securities without your approval, which would dilute your ownership interest in us and may depress the market price of our common stock.

 

   

Our warrants are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results.

 

   

We have identified a material weakness in our internal control over financial reporting related to the accounting for the warrants we issued in connection with our initial public offering in September 2020. This material weakness could continue to adversely affect our ability to report our results of operations and financial condition accurately and in a timely manner.

 

   

If the combined company’s performance following the Business Combination does not meet market expectations, the price of our securities may decline.

 

   

PWP is a private company and as such little information is publicly available regarding PWP. This may result in the Business Combination not being as profitable as we expect, or at all.

 

   

Even if we consummate the Business Combination, the public warrants may never be in the money, and they may expire worthless.

 

   

Warrants to purchase our common stock will become exercisable following the Business Combination, which could increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders.

 

   

Our stockholders will experience immediate dilution due to the issuance of common stock to the PWP stockholders as consideration in the Business Combination. Having a minority share

 

58


Table of Contents
 

position likely reduces the influence that our current stockholders have on the management of the combined company.

 

   

If we are unable to complete the Business Combination with PWP or another business combination by our Business Combination Outside Date, we will cease all operations except for the purpose of winding up our affairs, redeem our outstanding public shares and dissolve and liquidate. In such event, third parties may bring claims against us and, as a result, the proceeds held in the trust account could be reduced and the per share liquidation price received by our stockholders could be less than $10.00 per share.

 

   

Our directors may decide not to enforce the indemnification obligations of Cohen Sponsor Interests IV, LLC, resulting in a reduction in the amount of funds in the trust account available for distribution to our public stockholders.

 

   

Control of Perella Weinberg Partners by Professional Partners may give rise to actual or perceived conflicts of interest with the Partners who manage Professional Partners.

 

   

Upon consummation of the Business Combination, Perella Weinberg Partners will be a “controlled company” within the meaning of the rules of Nasdaq and, as a result, will qualify for, and intend to rely on, exemptions from certain corporate governance requirements. You will not have the same protections afforded to stockholders of companies that are subject to such requirements.

 

   

The historical consolidated and unaudited pro forma financial information in this proxy statement is not representative of the results Perella Weinberg Partners would have achieved as a stand-alone public company and may not permit you to predict its future results.

 

   

The market price of Perella Weinberg Partners Class A common stock may be volatile, which could cause the value of your investment to decline.

 

   

Anti-takeover provisions in Perella Weinberg Partners’ charter documents and Delaware law, as well as the rules of FINRA, the FCA, the Alberta Commission, IIROC, ACPR and other U.S. or foreign governmental regulatory authorities or self-regulatory organizations, could delay or prevent a change in control.

 

   

Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation will provide that, unless Perella Weinberg Partners consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for certain stockholder limitation matters, which could discourage stockholder lawsuits or limit our stockholders’ ability to bring a claim in any judicial forum that they find favorable for disputes with Perella Weinberg Partners or its officers and directors.

Risks Related to the Redemption

 

   

Public stockholders, together with any affiliates of theirs or any other person with whom they are acting in concert or as a “group,” will be restricted from exercising redemption rights with respect to more than 15% of the public shares.

 

   

A stockholder’s decision as to whether to redeem his, her, or its shares for a pro rata portion of the trust account may not put the stockholder in a better future economic position.

 

   

If our stockholders fail to comply with the redemption requirements specified in this proxy statement, they will not be entitled to redeem their shares of our common stock for a pro rata portion of the funds held in our trust account.

 

59


Table of Contents

Risks Related to the Business of PWP

The following risk factors apply to the business and operations of PWP and will also apply to the business and operations of Perella Weinberg Partners. The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may adversely affect the ability to complete or realize the anticipated benefits of the Business Combination, and may have a material adverse effect on the business, cash flows, financial condition and results of operations of Perella Weinberg Partners. Unless the context otherwise requires, all references in this subsection to the “Company,” “we,” “us” or “our” refer to the business of PWP prior to the consummation of the Business Combination, and Perella Weinberg Partners following the consummation of the Business Combination.

The scale, scope and duration of the impact of the COVID-19 pandemic on our business is unpredictable and depends on a number of factors outside of our control. We cannot reasonably predict the magnitude of the ultimate impact that COVID-19 will have on us and whether the impact may have a sustained adverse effect on our business, revenues, operating results and financial condition.

COVID-19 has created global economic disruption and uncertainty. COVID-19 has adversely impacted our business and is expected to continue to have a significant and adverse effect on our business, revenues and operating results in the short term. Additionally, the prolonged impact of COVID-19 could heighten the impact of one or more of the other risk factors described herein.

As a financial services firm, we are materially affected by conditions in the global financial markets and economic conditions throughout the world. During periods of unfavorable market or economic conditions, including current market conditions, the volume and value of M&A and capital markets transactions may decrease, thereby reducing the demand for our M&A and capital markets advisory services and increasing price competition among financial services companies seeking such engagements. Starting in March 2020, fewer new M&A transactions have launched due to market volatility and uncertainty caused by COVID-19. Our M&A revenues have been and are expected to continue to be adversely affected by such reduction in the volume or value of such advisory transactions. Further, in the period following an economic downturn, the volume and value of M&A and capital markets transactions typically take time to recover and lag a recovery in market and economic conditions. While we anticipate that our advisory business will see increased activity due to the substantial impairment of global financial markets and economic conditions, it is uncertain as to whether this increase will produce revenues equal to those lost in our advisory business. In addition, historically, the transition from an environment in which there is strong M&A and capital markets activity to one in which there is strong financial restructuring activity does not happen at once. Therefore, our overall revenues are likely to be reduced for some period before (if it occurs at all) we realize substantial revenues from our advisory business. As such, our profitability is expected to be adversely affected in the short term due to COVID-19 and may be impacted for a sustained period if we determine not to, or are unable to, scale back fixed and other costs within a time frame sufficient to match decreases in revenue relating to changes in market and economic conditions. We believe COVID-19’s adverse impact will also be significantly driven by other factors that are beyond our control, including, for example: the timing, scope, and effectiveness of additional governmental responses to the pandemic; medical advancements providing vaccinations for the novel coronavirus and treatments for the medical conditions caused by the virus, the timing and speed of economic recovery; the impact on our clients’ willingness to transact in a sustained uncertain environment; and the continued unpredictable impacts on public health and economic activity as the pandemic continues.

Our business (from both a marketing and execution perspective) depends to a large degree on our financial staff meeting in person with potential and engaged clients, potential and actual counterparties to our clients involved in transactions, and other parties in interest. The travel

 

60


Table of Contents

restrictions and social distancing requirements that have been put in place as a result of COVID-19 have greatly diminished our current ability to travel and attend events and meetings in person. While, during the COVID-19 pandemic, we have successfully conducted meetings using technology, our ability to generate and conduct business may have been adversely impacted.

We have implemented various initiatives to reduce the impact of COVID-19 on our firm and our people, such as employees working remotely from home, while also seeking to maintain business continuity. We face various cybersecurity and other operational risks related to our business on a day to day basis, which may be heightened by COVID-19. We rely heavily on financial, accounting, communication, and other information technology systems, including, without limitation, cloud based storage systems, and the people who operate them. These systems, including the systems of third parties on whom we rely, may experience a disruption as a result of COVID-19 or increased cybersecurity threats. If we were unable to timely and successfully recover from such a disruption, our business could be materially impacted and such a disruption could cause material financial loss, regulatory actions, reputational harm or legal liability. An extended period of remote working by our employees could strain our technology resources and introduce operational risks, including heightened cybersecurity risk. Remote working environments may be less secure and more susceptible to hacking attacks, including phishing and social engineering attempts that seek to exploit the COVID-19 pandemic. COVID-19 presents a threat to our employees’ well-being. While we have implemented a business continuity plan to protect the health of our employees, such plans cannot anticipate all scenarios, and we may experience a potential loss of productivity.

We remain subject to the risks of future pandemics, which could result in challenges to our business that are similar to, or in excess of, those posed by COVID-19.

Our future growth will depend on, among other things, our ability to successfully identify, recruit and develop talent and will require us to commit additional resources.

We have experienced significant growth over the past several years, which may be difficult to sustain at the same rate. In addition, our business involves the delivery of professional services and is largely dependent on the talents and efforts of highly skilled individuals. Accordingly, our future growth will depend on, among other things, our ability to successfully identify and recruit individuals to join our firm. It typically takes time for these professionals to become profitable and effective. During that time, we may incur significant expenses and expend significant time and resources toward training, integration and business development aimed at developing this new talent. If we are unable to recruit and develop such professionals, we will not be able to implement our growth strategy and our financial results could be materially adversely affected.

In addition, sustaining growth will require us to commit additional management, operational and financial resources and to maintain appropriate operational and financial systems to adequately support expansion, especially in instances when we open new offices that may require additional resources before they become profitable. See “Risks Related to the Business of PWP—Our growth strategy may involve opening or acquiring new offices and/or expanding, both domestically and internationally, and could involve hiring new Limited Partners and other senior professionals for these offices, which would require substantial investment by us and could materially adversely affect our operating results.” There can be no assurance that we will be able to manage our expanding operations effectively, and any failure to do so could materially adversely affect our ability to grow revenue and control our expenses.

Furthermore, we have grown, and in the future we may continue to grow, by strategic investment or acquisition, which would expose us to numerous risks and uncertainties similar to those of hiring and developing our current professionals. Additionally, there are challenges related to integrating a large number of personnel into our global organization and ensuring a proper cultural fit. Management and

 

61


Table of Contents

other existing personnel have spent, and may in the future spend, considerable time and resources working to integrate any acquired business or strategic investment, which may distract them from other business operations.

Our inability to successfully identify, consummate and integrate strategic transactions such as joint ventures, strategic investments and acquisitions may result in additional risks and uncertainties in our business.

In addition to recruiting and internal promotions, we may grow our business through strategic transactions, including joint ventures, strategic investments or acquisitions.

We regularly evaluate opportunities to acquire other businesses. Unless and until acquisitions of other businesses generate meaningful revenues, the purchase prices or consideration we pay to acquire such businesses could have a material adverse effect on our business, financial condition and results of operations. If we acquire a business, we may be unable to manage it profitably or successfully integrate its operations with our own. Additionally, acquisitions may have “earn-out” provisions that could result in large costs after the closing of the acquisition, some or all of which could be dilutive of the holders of Perella Weinberg Partners Class A common stock. Moreover, we may be unable to realize the financial, operational, and other benefits we anticipate from acquisitions. Competition for future acquisition opportunities in our markets could increase the price we pay for businesses we acquire and could reduce the number of potential acquisition targets. Further, acquisitions may involve a number of special financial and business risks, including expenses related to any potential acquisition from which we may withdraw; diversion of our management’s time, attention, and resources; decreased utilization during the integration process; loss of key acquired personnel; difficulties in integrating diverse corporate cultures; increased costs to improve or integrate personnel and financial, accounting, technology and other systems, including compliance with the Sarbanes-Oxley Act of 2002; dilutive issuances of equity securities, including convertible debt securities; the assumption of legal liabilities; amortization of acquired intangible assets; potential write-offs related to the impairment of goodwill and additional conflicts of interest. In addition, our clients may react unfavorably to our acquisition, growth and joint venture strategies, and disagreements between us and any joint-venture partners may negatively impact our business and profitability. If we are unable to successfully manage these risks, we will not be able to implement our growth strategy, which could ultimately materially adversely affect our business, financial condition and results of operations.

In the case of any joint ventures and strategic investments, we are subject to additional risks and uncertainties relating to governance and controls, in that we may be dependent upon personnel, controls and systems, including management of the business by third parties, and subject to liability, losses or reputational damage relating to such personnel, controls and systems and the management decisions of third parties that are not under our control. In the event we make further strategic investments or acquisitions, we would face numerous risks and would be presented with financial, managerial and operational challenges, including the difficulty of integrating personnel, financial, accounting, technology and other systems and management controls.

Changing market conditions can adversely affect our business in many ways, including by reducing the volume of the transactions involving our business, which could materially reduce our revenue.

As a financial services firm, we are materially affected by conditions in the global financial markets and economic conditions throughout the world. Financial markets and economic conditions can be negatively impacted by many factors beyond our control, such as the inability to access credit markets, rising interest rates or inflation, pandemic, terrorism, political uncertainty, uncertainty in U.S. federal fiscal, monetary, tax or regulatory policy and the fiscal, monetary, tax or regulatory policy of foreign governments and the timing and nature of such reform. For example, our revenue is related to

 

62


Table of Contents

the volume and value of the transactions in which we are involved. During periods of unfavorable market or economic conditions, the volume and value of M&A transactions may decrease, thereby reducing the demand for our M&A advisory services and increasing price competition among financial services companies seeking such engagements. We may face a similar reduction in demand for our M&A services when the prices of certain commodities, including oil, remain suppressed or experience volatility for an extended period of time. In addition, during periods of strong market and economic conditions, the volume and value of recapitalization and restructuring transactions may decrease, thereby reducing demand for our recapitalization and restructuring advisory services and increasing price competition among financial services companies seeking such engagements. Our results of operations could be adversely affected by any such reduction in the volume or value of such advisory transactions. Revenue improvements in our M&A practice in strong economic conditions could be offset in whole or in part by any related revenue declines in our restructuring practice. Further, in the period following an economic downturn, the volume and value of M&A transactions typically take time to recover and lag a recovery in market and economic conditions. These trends are cyclical in nature and subject to periodic reversal.

Furthermore, rapid increases in equity valuations and market volatility can negatively impact M&A activity. Our clients engaging in M&A transactions often rely on access to the credit and/or equity markets to finance such transactions. The uncertain availability of credit and the volatility of equity markets can adversely affect the size, volume, timing and ability of our clients to successfully complete M&A transactions and adversely affect our advisory business. Market volatility also affects our clients’ ability and willingness to engage in stock-for-stock transactions.

Changes in market and economic conditions can also impact other aspects of our business in different ways. For example, our profitability may be adversely affected by our fixed costs and the possibility that we would be unable to scale back other costs within a time frame sufficient to match any decreases in revenue relating to changes in market and economic conditions. While we operate in North America, Europe and the Middle East, our operations in the United States have historically provided most of our revenues and earnings. Consequently, our revenues and profitability are particularly affected by market conditions in the United States.

Our revenue in any given period is dependent on the number of fee-paying clients in such period, and a significant reduction in the number of fee-paying clients in any given period could reduce our revenue and adversely affect our operating results in such period.

Our revenue in any given period is dependent on the number of fee-paying clients in such period. For the year ended December 31, 2020 we earned revenues from 175 advisory clients, 99 of which generated fees equal to or greater than $1 million. For the year ended December 31, 2019 we earned revenues from 179 advisory clients, 100 of which generated fees equal to or greater than $1 million. For the year ended December 31, 2018 we earned revenues from 197 advisory clients, 105 of which generated fees equal to or greater than $1 million. For the year ended December 31, 2017 we earned revenues from 187 advisory clients, 94 of which generated fees equal to or greater than $1 million. We may lose clients as a result of the sale or merger of a client, a change in a client’s senior management, competition from other financial advisors and financial institutions and other causes. A significant reduction in the number of fee-paying clients in any given period could reduce our revenue and adversely affect our operating results for such period. There was no individual client that accounted for more than 10% of aggregate revenues for the years ended December 31, 2020, 2019, 2018 and 2017.

In addition, the composition of the group comprising our largest clients varies significantly from year to year, and a relatively small number of clients may account for a significant portion of our revenues in any given period. As a result, our business, financial condition, results of operations and liquidity may be significantly affected by the loss of a relatively small number of mandates or the failure of a relatively small number of assignments to be completed.

 

63


Table of Contents

We have recorded operating losses in the past and may experience operating losses in the future.

For the years ended December 31, 2020, 2019 and 2018, we recorded operating losses of $14.6 million, $155.1 million and $107.4 million, respectively. These operating losses have been largely due to the equity-based compensation awards granted by Professional Partners, which have no economic impact on PWP or PWP OpCo. The vesting of equity awards granted in connection with the Transaction will be recorded as equity-based compensation expense at PWP OpCo for GAAP accounting purposes. We need to continue to compensate personnel competitively in order to continue building our business and as a result, may continue to experience operating losses in future periods.

Our ability to retain Working Partners and key employees is critical to the success of our business.

Our future success depends to a substantial degree on our ability to retain qualified professionals within our organization, including our Working Partners. However, we may not be successful in our efforts to retain the required personnel as the market for qualified advisory professionals is extremely competitive. Working Partners and other senior professionals have left us in the past and others may do so in the future. Loss of key employees may occur due to perceived opportunity for promotion, compensation levels, work environment, retirement or the pursuit of philanthropic, civic or similar service opportunities, or other individualized reasons, some of which may be beyond our control. Our senior personnel possess substantial experience and expertise and have strong relationships with our advisory clients. As a result, the loss of these professionals could jeopardize our relationships with clients and result in the loss of client engagements. For example, if any of our Working Partners or other senior professionals, including our executive officers, or groups of professionals, were to join or form a competing firm, some of our current clients could choose to use the services of that competitor rather than our services. There is no guarantee that our compensation and non-competition arrangements with our Working Partners provide sufficient incentives or protections to prevent our Working Partners from resigning to compete with our Company or join our competitors. For instance, we are currently the plaintiff in a litigation involving certain former Working Partners and a former employee as defendants, in which the defendants allegedly entered into a scheme to lift out our entire restructuring group to form a new competing firm that they were secretly forming in breach of their contractual and fiduciary duties to our Company. See “Information about PWP—Legal Proceedings.” In addition, some of our competitors have more resources than we do, which may allow them to attract some of our existing employees through higher compensation, promotions or otherwise. The departure of a number of Working Partners or groups of professionals could have a material adverse effect on our business and our profitability.

Substantially all of our revenue is derived from advisory fees, including fees that are largely contingent upon the completion of events which may be out of our control, such as the completion of a transaction and, as a result, our revenue and profits are highly volatile on a quarterly basis.

Our revenue and profits can be highly volatile. Unlike diversified investment banks, which generate revenues from commercial lending, securities trading and retail banking, or other advisory firms, which have asset management and other recurring revenue businesses, our generation of revenues from sources other than advisory fees is minimal. Our advisory fees are generally derived from a limited number of engagements that generate significant fees contingent on key transaction milestones, the timing and conditions of which are outside of our control. We expect that we will continue to rely on advisory fees for most of our revenue for the foreseeable future. Accordingly, a decline in our advisory engagements or the market for advisory services would adversely affect our business. In addition, our financial results will likely fluctuate from quarter to quarter based on the

 

64


Table of Contents

timing of when fees are earned, and high levels of revenue in one quarter will not necessarily be predictive of continued high levels of revenue in future periods. In some cases, for advisory engagements that do not result in the successful consummation of a transaction, we are not paid a fee other than the reimbursement of certain out-of-pocket expenses and, in some cases, a retainer, despite having devoted considerable resources to these transactions.

Because we lack other, more stable, sources of revenue which could moderate some of the volatility in our advisory revenue, we may experience greater variations in our revenue and profits than other larger, more diversified competitors in the financial services industry. Should our contingent fee arrangements represent a greater percentage of our business in the future, we may experience increased volatility in our working capital requirements and greater variations in our quarter-to-quarter results.

Because in many cases revenues are not recognized until the successful consummation of the underlying transaction, our revenue is highly dependent on market conditions and the decisions and actions of our clients, interested third parties and governmental authorities. For example, we may be engaged by a client in connection with a sale or divestiture, but the transaction may not occur or be consummated because, among other things, anticipated bidders may not materialize, no bidder is prepared to pay our client’s price or because our client’s business experiences unexpected operating or financial problems. We may be engaged by a client in connection with an acquisition, but the transaction may not occur or be consummated for a number of reasons, including because our client may not be the winning bidder, failure to agree upon final terms with the counterparty, failure to obtain necessary regulatory consents or board or stockholder approvals, failure to secure necessary financing, adverse market conditions or because the target’s business experiences unexpected operating or financial problems. Additionally, a client may not receive bids acceptable to it in connection with a restructuring transaction or may not be able to restructure its operations or indebtedness due to a failure to reach an agreement with its principal creditors or the court. In such circumstances, we often do not receive advisory fees, despite having devoted considerable resources to these transactions.

Our engagements are often singular in nature and do not provide for subsequent engagements, which could cause our revenues to fluctuate materially from period to period.

We operate in a highly-competitive environment where our clients generally retain us on a non-exclusive, short-term, engagement-by-engagement basis in connection with specific transactions or projects, rather than under long-term contracts covering potential additional future services. As these transactions and projects are often singular in nature and subject to intense competition, we must seek out new engagements when our current engagements are successfully completed or terminated. As a result, high activity levels in any period are not indicative of high activity levels in the next-succeeding or any future period, and the successful completion of a previous engagement does not guarantee that we will be engaged by the same client in the future on the same terms or at all.

Our clients may be unable to pay us for our services.

We face the risk that our clients may not have the financial resources to pay our agreed-upon advisory fees, including in the bankruptcy or insolvency context. Further, our clients include companies that have had and may from time to time encounter financial difficulties. If a client’s financial difficulties become severe, the client may be unwilling or unable to pay our invoices in the ordinary course of business, which could adversely affect collections of both our accounts receivable and unbilled services. On occasion, some of our clients have entered bankruptcy, which has prevented us from collecting amounts owed to us. The bankruptcy of a number of our clients who, in the aggregate, owe us substantial accounts receivable could have a material adverse effect on our business, financial

 

65


Table of Contents

condition and results of operations. In addition, if a client declares bankruptcy after paying us certain invoices, courts may determine that we are not properly entitled to those payments and may require repayment of some or all of the amounts we received, which could adversely affect our business, financial condition and results of operations. Further, some fees earned from certain activities in our restructuring business are subject to approval by the U.S. Bankruptcy Courts and other interested parties which have the ability to challenge the payment of such fees. Fees earned and reflected in our revenue may from time to time be subject to successful challenges, which could result in a reduction of revenue. Certain clients may, due to changes in senior personnel, ownership or otherwise, also be unwilling to pay our advisory fees in whole or in part, in which case we may have to incur significant costs to bring legal action to enforce our engagement agreements to obtain our advisory fees. Such actions may require considerable financial and personnel resources and may result in negative public relations due to the public nature of legal action. Ultimately, there is no guaranty that such legal action could be successful.

If the number of debt defaults, bankruptcies or other factors affecting demand for our recapitalization and restructuring advisory services declines, our recapitalization and restructuring business could suffer.

We provide various financial recapitalization and restructuring and related advice to companies in financial distress or to their creditors or other stakeholders. A number of factors affect demand for these advisory services, including general economic conditions, the availability and cost of debt and equity financing, governmental policy and changes to laws, rules and regulations, including those that protect creditors. In addition, providing recapitalization and restructuring advisory services entails the risk that the transaction will be unsuccessful or take considerable time and can be subject to a bankruptcy court’s authority to disallow or discount our fees in certain circumstances, including after payment of our fees. If the number of debt defaults, bankruptcies or other factors affecting demand for our recapitalization and restructuring advisory services declines, our business could be adversely affected.

Our failure to deal appropriately with actual, potential or perceived conflicts of interest could damage our reputation and materially adversely affect our business.

We confront actual, potential or perceived conflicts of interest in our business. For instance, we face the possibility of an actual, potential or perceived conflict of interest when we represent a client on a transaction in which an existing (or future) client is (or becomes) a party. We may be asked by two or more potential clients to act on their behalf on the same transaction, including multiple clients as potential buyers in the same acquisition transaction, and we may act for such clients if all such clients agree to us doing so (with such agreement potentially being subject to certain operational or other conditions). In each of these situations, we face the risk that our current policies, controls and procedures do not timely identify, disclose or appropriately manage such conflicts of interest.

In addition, we frequently come into possession of material non-public information and other confidential information in connection with our advisory engagements, and our possession of a client’s material non-public information could place restrictions on our other operations or engagements. It is possible that actual, potential or perceived conflicts could give rise to client dissatisfaction, litigation or regulatory enforcement actions, or result in a client terminating our engagement. Appropriately identifying and managing actual or perceived conflicts of interest is complex and difficult, and our reputation could be damaged if we fail, or appear to fail, to deal appropriately with one or more potential or actual conflicts of interest. Regulatory scrutiny of, or litigation in connection with, conflicts of interest could have a material adverse effect on our reputation which could materially adversely affect our business in a number of ways, including as a result of a reluctance of some potential clients and counterparties to do business with us.

 

66


Table of Contents

Policies, controls and procedures that we implement or may be required to implement to address additional regulatory requirements, including as a result of additional foreign jurisdictions in which we operate, or to mitigate actual or potential conflicts of interest, may result in increased costs; including for additional personnel and infrastructure and information technology improvements; limit our activities; and reduce the positive synergies that we seek to cultivate across our businesses. Conflicts may also arise if our advisory business has access to material non-public information that may not be shared with our equity research business or vice versa.

Employee misconduct, which is difficult to detect and deter, and other labor-related issues could harm us by impairing our ability to attract and retain clients and by subjecting us to legal liability and reputational harm.

There have been a number of highly-publicized cases involving fraud, insider trading or other misconduct by employees in the financial services industry, and there is a risk that our employees could engage in misconduct that would adversely affect our business. For example, our business often requires that we deal with confidential matters of great significance to our clients. If our employees were to improperly use or disclose confidential information provided by our clients, we could be subject to legal sanctions and suffer serious harm to our reputation, financial position, current client relationships and ability to attract future clients. In addition, our financial professionals and other employees are responsible for following proper measures to maintain the confidentiality of information we hold. If an employee’s failure to do so results in the improper release of confidential information, we could be subject to reputational harm and legal liability, which could impair our ability to attract and retain clients and/or personnel and in turn materially adversely affect our business. Furthermore, as we continue to increase the size of our workforce, the risk of potential employment-related claims will also increase. As such, we may be subject to legal proceedings related to employment matters including, but not limited to, discrimination, harassment (sexual or otherwise), wrongful termination and local, state or federal labor law violations. It is not always possible to deter employee misconduct, and the precautions we take to detect and prevent misconduct may not be effective in all cases. If our employees engage in misconduct or fail to follow appropriate security measures, our business could be materially adversely affected.

The U.S. Department of Justice and the SEC continue to devote significant resources to the enforcement of the Foreign Corrupt Practices Act (the “FCPA”). In addition, the United Kingdom (“U.K.”) and other jurisdictions have significantly expanded the reach of their anti-bribery laws. While we have developed and implemented policies and procedures that we believe are reasonably designed to ensure compliance by us and our personnel with the applicable laws, such policies and procedures may not be effective in all instances to prevent violations. Any determination that we have violated the FCPA or other applicable anti-corruption laws could subject us to, among other things, reputational damage, regulatory enforcement, civil and criminal penalties, material fines, profit disgorgement, injunctions on future conduct, securities litigation and/or a general loss of client or investor confidence, any one of which could adversely affect our business prospects, financial position or the market value of Perella Weinberg Partners Class A common stock. For further detail regarding the FCPA and other regulations that we are subject to, see “Information about PWP—Regulation.

We may face damage to our professional reputation if our services are not regarded as satisfactory or for other reasons.

As an advisory service firm, we depend to a large extent on our relationships with our clients and reputation for integrity and high caliber professional services to attract and retain clients. Our ability to secure new engagements is substantially dependent on our reputation and the individual reputations of our financial professionals. Any factor that diminishes our reputation or that of our financial professionals, including not meeting client expectations or actual or alleged misconduct by our financial

 

67


Table of Contents

professionals, including misuse of confidential information or mishandling actual or perceived conflicts, could make it substantially more difficult for us to attract new engagements and clients or retain existing clients. As a result, if a client is not satisfied with our services, it may be more damaging in our field of business than in other business fields.

Further, because we provide our services primarily in connection with significant or complex transactions, disputes or other matters that usually involve confidential and sensitive information or are adversarial, and because our work is the product of myriad judgments of our financial professionals and other staff operating under significant time and other pressures, we may not always perform to the standards expected by our clients. In addition, we may face reputational damage from, among other things, litigation against us, actual or perceived conflicts of interest, our failure to protect confidential information and/or breaches of our cybersecurity protections or other inappropriate disclosure of confidential information, including inadvertent disclosures.

We face strong competition from other financial advisory firms, many of which have the ability to offer clients a wider range of products and services than those we can offer, which could cause us to lose engagements to competitors, fail to win advisory mandates and subject us to pricing pressures that could materially adversely affect our revenue and profitability.

The financial services industry is intensely competitive, highly fragmented and subject to rapid change and we expect it to remain so. Our competitors are other investment banking and financial advisory firms. We compete on both a global and a regional basis, and on the basis of a number of factors, including depth of client relationships, industry knowledge, transaction execution skills, our range of products and services, innovation, reputation and price. In addition, in our business there are usually no long-term contracted sources of revenue. Each revenue generating engagement typically is separately solicited, awarded and negotiated.

We have experienced intense competition in obtaining advisory mandates in recent years, including with respect to pricing, and we may experience further pricing pressures in our business in the future as some of our competitors may seek to obtain increased market share by reducing fees.

Our competitors include large financial institutions, many of which have far greater financial and other resources than we do and, unlike us, have the ability to offer a wider range of products, from loans, deposit taking and insurance to brokerage and trading, and employ more key professionals to serve their clients’ needs and develop client relationships, which may enhance their competitive position. They also regularly support investment banking, including financial advisory services, with commercial lending and other financial services and products we do not offer in an effort to gain market share, which puts us at a competitive disadvantage and could result in pricing pressures or loss of opportunities, which could materially adversely affect our revenue and profitability. These larger and better capitalized competitors may also be better able to respond to changes in the financial services industry. In addition, we may be at a competitive disadvantage with regard to certain of our competitors who are able to and often do, provide financing or market-making services that are often a crucial component of the types of transactions on which we advise.

In addition to our larger competitors, we also compete with a number of independent investment banks that offer independent advisory services. There are relatively few barriers to entry impeding the launch of new financial advisory firms, including a relatively low cost of entering this business, and the success of new entrants into our lines of business, including major banks and other financial institutions, have resulted in increased competition. As these independent firms or new entrants into the market seek to gain market share there could be pricing pressures, which would adversely affect our revenues and earnings.

 

68


Table of Contents

If we are unable to compete successfully with our existing competitors or with any new competitors, we will not be able to implement our growth strategy, which ultimately could materially adversely affect our business, financial condition and results of operations.

Goodwill and other intangible assets represent a significant portion of our assets, and an impairment of these assets could have a material adverse effect on our business, financial condition and results of operation.

Goodwill and other intangible assets represent a significant portion of our assets, and totaled $73.3 million and $79.9 million as of December 31, 2020 and 2019, respectively. Goodwill is the excess of the fair value of consideration transferred over the fair value of identifiable net assets, including other intangibles, acquired at the time of an acquisition. We review goodwill and other intangible assets at least annually for impairment. We may need to perform impairment tests more frequently if events occur or circumstances indicate that the carrying amount of these assets may not be recoverable. These events or circumstances could include a significant change in the business climate, attrition of key personnel, a prolonged decline in our stock price and market capitalization, legal factors, or operating performance indicators, competition, sale or disposition of a significant portion of one of our businesses and other factors. Annual impairment reviews of indefinite-lived intangible assets, any future impairment of goodwill or other intangible assets would result in a non-cash charge against earnings, which would adversely affect our results of operations. The valuation of the reporting unit requires judgment in estimating future cash flows, discount rates and other factors. In making these judgments, we evaluate the financial health of our reporting unit, including such factors as market performance, changes in our client base and projected growth rates. Because these factors are ever changing, due to market and general business conditions, our goodwill and indefinite-lived intangible assets may be impaired in future periods.

We may be unable to execute on our growth initiatives, business strategies or operating plans.

We are executing on a number of growth initiatives, strategies and operating plans designed to enhance our business. For example, we have expanded, and intend to continue to expand, our platform into various industry and product sectors, both organically and through acquisitions, and to expand our existing expertise into new geographies. The anticipated benefits from these efforts are based on several assumptions that may prove to be inaccurate. Moreover, we may not be able to successfully complete these growth initiatives, strategies and operating plans and realize all or any of the expected benefits, including growth targets and margin expansion, we expect to achieve or it may be more costly to do so than we anticipate. A variety of factors could cause us not to realize some or all of the expected benefits. These factors include, among others: delays in the anticipated timing of activities related to such growth initiatives, strategies and operating plans; difficulty in competing in certain industries, product areas and geographies in which we have less experience than others; negative attention from any failed initiatives; and increased or unexpected costs in implementing these efforts.

Moreover, our continued implementation of these programs may disrupt our operations and performance. As a result, we may not realize the expected benefits from these plans. If, for any reason, the benefits we realize are less than our estimates or the implementation of these growth initiatives, strategies and operating plans adversely affect our operations or cost more or take longer to effectuate than we expect, or if our assumptions prove inaccurate, we will not be able to implement our growth strategy, which ultimately could materially adversely affect our business, financial condition and results of operations.

 

69


Table of Contents

Restrictions in the Credit Agreement (as defined below) governing our Revolving Credit Facility (as defined below) or the credit agreement governing any Replacement Facility (as defined below) may impair our ability to finance our future operations or capital needs or engage in other business activities that may be in our interests.

On December 11, 2018, Group LP, a wholly owned subsidiary of PWP OpCo, entered into the Revolving Credit Facility in order to pay in full the outstanding Senior Term Loan (as defined below) plus outstanding interest, fees and expenses related thereto and provide for the future working capital needs and other general corporate purposes of Group LP and its subsidiaries. The Revolving Credit Facility provides for a $50 million unsecured revolving credit facility that matures on April 1, 2022, and contains a number of significant covenants that, among other things, require PWP OpCo and certain of its subsidiaries (the “Loan Parties”) to maintain (on a consolidated basis) minimum liquidity levels, a minimum debt service coverage ratio and a maximum leverage ratio and restrict the ability of the Loan Parties to:

 

   

incur liens;

 

   

dispose of assets;

 

   

incur additional indebtedness;

 

   

make certain restricted payments;

 

   

repay certain indebtedness;

 

   

make certain investments or business acquisitions;

 

   

make certain capital expenditures;

 

   

engage in business mergers or consolidations; and

 

   

engage in certain transactions with subsidiaries and affiliates.

These restrictions (and similar restrictions under and Replacement Facility) could impair our ability to finance our future operations or capital needs or engage in other business activities that may be in our interests. The ability of the Loan Parties to comply with these financial ratios and covenants may be affected by events beyond our control. A breach of the provisions of the Revolving Credit Facility (or any Replacement Facility) or the inability of any Loan Party to comply with the required financial ratios or covenants included therein could result in a default thereunder. In the event of any such default, the administrative agent under the Revolving Credit Facility (or any Replacement Facility) could elect to:

 

   

declare the commitments of all of the lenders under the Revolving Credit Facility (or any Replacement Facility) to be terminated; and

 

   

declare all outstanding debt, accrued interest and fees to be due and immediately payable.

Any such election could have a material adverse effect on our business, financial condition and results of operations, as well as our reputation, which could materially adversely affect our business in a number of ways, including as a result of a reluctance of some potential clients and counterparties to do business with us.

As a member of the financial services industry, we face substantial litigation risks.

Our role as advisor to our clients on important transactions involves complex analysis and the exercise of professional judgment, including rendering “fairness opinions” in connection with mergers and other transactions. Our activities may subject us to the risk of significant legal liabilities to our clients and affected third parties, including shareholders of our clients who could bring securities class

 

70


Table of Contents

actions against us. In recent years, the volume of claims and amount of damages claimed in litigation and regulatory proceedings against financial services companies have been increasing, including claims for aiding and abetting client misconduct. Litigation alleging that we performed below our agreed standard of care or breached any other obligations to a client or other parties could expose us to significant legal liabilities, and, regardless of outcome, could be very costly, could distract our management and could damage our reputation. For example, we are currently involved in litigation with certain former Legacy Partners and a former employee regarding claims of breach of contract. For further information, see “Information about PWP—Legal Proceedings.” Moreover, judicial scrutiny and criticism of investment banker performance and activities has increased, creating risk that our services in a litigated transaction could be criticized by a court. These risks often may be difficult to assess or quantify and their existence and magnitude often remain unknown for substantial periods of time.

Our engagements typically include broad indemnities from our clients and provisions to limit our exposure to legal claims relating to our services, but these provisions may not protect us in all cases, including when we perform below our agreed standard of care or a client does not have the financial capacity to pay for its obligations under any such indemnity. As a result, we may incur significant legal expenses in defending against or settling litigation. In addition, we may not have, and may not in the future choose to obtain, insurance with respect to any or all potential claims and, if desirable, we may have to spend a significant amount to adequately insure against these potential claims, and such insurance coverage may not be available on commercial terms or at all. Substantial legal liability or significant regulatory action against us or significant criticism by a court of our performance or activities could have material adverse financial effects or cause significant reputational harm to us, which could materially harm our business prospects, financial condition and results of operations. Further, allegations by private litigants or regulators of our having engaged in improper conduct, whether true or false and regardless of whether the ultimate outcome is favorable or unfavorable to us, as well as negative publicity and press speculation about us, our competitors or our industry, whether or not valid, may harm our reputation, which may be more damaging to our business than to other types of businesses.

Our management has not previously managed our advisory business as a separate public company.

The individuals who now constitute our management have not previously managed our advisory business as a separate publicly traded company. Compliance with public company requirements will place significant additional demands on our management and will require us to enhance our investor relations, legal, financial reporting and corporate communications functions. These additional efforts may strain our resources and divert management’s attention from other business concerns, which could adversely affect our business and profitability.

In addition, on February 28, 2019, we consummated the PWP Separation, separating our advisory business from the rest of the business of PWP OpCo. These two businesses have historically utilized common senior management and certain operational structures, including facilities and technology platforms as well as certain legal, compliance, human resources, finance, accounting, marketing and other support personnel and senior management oversight. The process of separating these businesses, and of operating our advisory business on a stand-alone basis, may result in increased costs and inefficiencies and other impediments to the regular operations of our business, the occurrence of any of which could adversely affect our business and profitability.

Extensive and evolving regulation of our business and the business of our clients exposes us to the potential for significant penalties and fines due to compliance failures, increases our costs and may result in limitations on the manner in which our business is conducted.

As a participant in the financial services industry, we are subject to extensive regulation in the United States and internationally, including regulatory capital and other requirements imposed on our

 

71


Table of Contents

two SEC-registered broker-dealers, Perella Weinberg Partners LP and Tudor, Pickering, Holt & Co. Securities, LLC (“TPH Securities”). We are subject to regulatory restrictions and requirements imposed by applicable statutes, regulations and policies in the jurisdictions in which we operate. U.S. and non-U.S. government agencies and self-regulatory organizations, including U.S. state securities commissions, are empowered to enforce the regulatory restrictions and requirements applicable to us and conduct administrative proceedings that can result in censure, fine, the issuance of cease-and-desist orders or the suspension or expulsion of a broker-dealer from registration or membership. See “Information about PWP—Regulation.

The statutes, regulations and policies to which we are subject may change at any time. Extensive legislation and implementing regulation affecting the financial services industry continue to be adopted in regions that directly or indirectly affect our business, including the United States, the U.K., the European Union (the “E.U.”), Canada, France and Germany, and the manner in which those laws and related regulations are applied to our operations is still evolving. For example, several states and municipalities in the United States, including, but not limited to, California, Illinois, New York State and New York City have adopted “pay-to-play” rules, which, in addition to imposing registration and reporting requirements, limit our ability to charge fees in connection with certain engagements of our advisory business. Any legislative or regulatory actions and any required changes to our business operations resulting from such legislation and regulations, as well as any deficiencies in our compliance with such legislation and regulation, could result in significant loss of revenue, limit our ability to pursue business opportunities in which we might otherwise consider engaging or otherwise adversely affect our businesses.

Our ability to conduct business and our operating results may also be adversely affected as a result of any new requirements imposed by, or changes in, the interpretation or enforcement of existing laws and rules by the SEC, FINRA, the FCA, the Canadian Securities Regulators, the IIROC, the ACPR or other U.S. or foreign governmental regulatory authorities or self-regulatory organizations that regulate financial services firms or supervise financial markets. In addition, some of our clients or prospective clients may adopt policies that exceed regulatory requirements and impose additional restrictions affecting their dealings with us. Accordingly, we may incur significant costs, including compliance costs, to comply with U.S. and international applicable statutory, regulatory and other requirements, and such expenses, including legal fees and fees paid to the SEC, FINRA, the FCA, the Canadian Securities Regulators, IIROC, ACPR and other U.S. or foreign governmental regulatory authorities or self-regulatory organizations, have increased in recent years and may continue to increase. For instance, in order to comply with such requirements, we maintain an internal team that works full-time to develop and implement regulatory compliance policies and procedures, monitor business activities to ensure compliance with such policies and procedures and reports to senior management. This team also uses various software tracking and reporting systems and confers regularly with internal and outside legal counsel in the performance of its responsibilities. The need to continuously adjust our operations to, and ensure compliance with, a changing regulatory environment may result in further increases in compliance and other operating costs, which may negatively affect our business.

In addition, new laws or regulations or changes in enforcement of existing laws or regulations applicable to our clients may adversely affect our business. For example, changes in antitrust enforcement or the focus of the Committee for Foreign Investment in the United States could affect the level of M&A activity and changes in applicable regulations could restrict the activities of our clients and their need for the types of advisory services that we provide to them.

Failure to comply with applicable laws or regulations could result in sanctions being levied against us, including fines, penalties, judgments, disgorgement, restitution and censures, suspension or expulsion from a certain jurisdiction, self-regulatory organization or market or the revocation or

 

72


Table of Contents

limitation of licenses. Failure to comply with applicable laws or regulations could also result in adverse publicity and reputational harm and could impair executive retention or recruitment. In addition, any changes in the regulatory framework could impose additional expenses or capital requirements on us, result in limitations on the manner in which our business is conducted, have a material adverse impact upon our business and financial condition and require substantial attention by senior management. In addition, our business is subject to periodic examination by various regulatory authorities, and we cannot predict the timing or the outcome of any such examinations.

Our business is subject to various cybersecurity and other operational risks.

We face various cybersecurity and other operational risks related to our business on a day-to-day basis. We rely heavily on financial, accounting, communication and other information technology systems and the people who operate them. These systems, including the systems of third parties on whom we rely, may fail to operate properly or become disabled as a result of tampering or a breach of our or such third parties’ network security systems or otherwise, including for reasons beyond our control.

Our clients typically provide us with sensitive and confidential information. We are dependent on information technology networks and systems to securely process, transmit and store such information and to communicate among our locations around the world and with our clients, alliance partners and vendors. We may be subject to attempted security breaches and cyber-attacks and a successful breach could lead to shutdowns or disruptions of our systems or third-party systems on which we rely and potential unauthorized disclosure of sensitive or confidential information. Breaches of our system or the third party network security systems on which we rely could involve attacks that are intended to obtain unauthorized access to our proprietary information, destroy data or disable, degrade or sabotage our systems, often through the introduction of computer viruses and the mounting of cyber-attacks and other means and could originate from a wide variety of sources, including employees, contractors, foreign governments and other unknown third parties outside the firm. If our or the third-party systems on which we rely are compromised, do not operate properly or are disabled, we could suffer a disruption of our business, financial losses, liability to clients, regulatory sanctions and damage to our reputation. In addition, our financial professionals and other employees are responsible for following proper measures to maintain the confidentiality of information we hold. If an employee’s failure to do so results in the improper release of confidential information, we could be subject to reputational harm and legal liability, which could impair our ability to attract and retain clients and in turn materially adversely affect our business. The increased use of mobile technologies can heighten these and other operational risks. There can be no assurance that we or the third parties on whom we rely will be able to anticipate, detect or implement effective preventative measures against frequently changing cyber threats.

We operate a business that is highly dependent on information systems and technology. Any failure to keep accurate books and records can render us liable to disciplinary action by governmental and self-regulatory authorities, as well as to claims by our clients. We rely on third party service providers for certain aspects of our business. Any interruption or deterioration in the performance of these third parties or failures of their information systems and technology could impair our operations, affect our reputation and adversely affect our business.

In addition, a disaster or other business continuity problem, such as a pandemic, other man made or natural disaster or disruption involving electronic communications or other services used by us or third parties with whom we conduct business, could lead us to experience operational challenges. Our continued success will depend, in part, on the availability of our personnel and office facilities and the proper functioning of our computer, software, telecommunications, transaction processing and other related systems and operations, as well as those of third parties on whom we rely. In particular, we

 

73


Table of Contents

depend on our headquarters in New York City, where a large number of our personnel are located, for the continued operation of our business. A disaster or a disruption in the infrastructure that supports our businesses, a disruption involving electronic communications or other services used by us or third parties with whom we conduct business, or a disruption that directly affects our headquarters or other major offices in Houston or the U.K., could have a material adverse impact on our ability to continue to operate our business without interruption. The incidence and severity of disasters or other business continuity problems are inherently unpredictable, and our inability to timely and successfully recover could materially disrupt our business and cause material financial loss, regulatory actions, reputational harm or legal liability.

We may not be able to generate sufficient cash to service any indebtedness.

Our ability to make scheduled payments on or to refinance any debt obligations, including borrowings under the Revolving Credit Facility or any Replacement Facility, depends on our financial condition and operating performance. We cannot provide assurance that we will maintain a level of cash flows from operating activities sufficient to permit us to pay the principal of, and interest on, any existing or future indebtedness. If our cash flows and capital resources are insufficient to fund any future debt service obligations, we may be forced to reduce or delay investments and capital expenditures, seek additional capital or restructure or refinance such indebtedness, and we may not be able to pursue any of these options on commercially reasonable terms or at all. This could also result in us lowering or eliminating future undeclared dividend payments. Any such transactions could also involve significant expense and management attention.

Our international operations are subject to certain risks, which may affect our revenue.

In 2020 and 2019, we earned approximately 25.4% and 16.3%, respectively, of our revenues from our international operations. We intend to grow our non-U.S. business, including growth into new regions with which we have less familiarity and experience, and this growth is important to our overall success. Our international operations carry special financial and business risks, which could include the following:

 

   

greater difficulties in managing and staffing foreign operations;

 

   

language barriers and cultural differences, including the need to adopt different business practices in different geographic areas;

 

   

fluctuations in foreign currency exchange rates that could adversely affect our results;

 

   

unexpected, additional and/or costly changes in trading policies, regulatory requirements, tariffs and other barriers;

 

   

restrictions on travel;

 

   

longer transaction cycles;

 

   

higher operating costs;

 

   

local labor conditions and regulations;

 

   

adverse consequences or restrictions on the repatriation of earnings;

 

   

potentially adverse tax consequences, such as trapped foreign losses or profits;

 

   

potentially less stable political and economic environments;

 

   

terrorism, political hostilities, war and other civil disturbances or other catastrophic events that reduce business activity;

 

74


Table of Contents
   

different fee structures for our advisory services; and

 

   

difficulty collecting fees.

Further, as part of our day-to-day operations outside the United States, we are required to create compensation programs, employment policies, compliance policies and procedures and other administrative programs that comply with the laws of multiple countries. We also must communicate and monitor standards and directives across our geographically dispersed operations.

Any payment of distributions, loans or advances to and from our subsidiaries could be subject to restrictions on or taxation of, dividends or repatriation of earnings under applicable local law, monetary transfer restrictions, foreign currency exchange regulations in the jurisdictions in which our subsidiaries operate or other restrictions imposed by current or future agreements, including debt instruments, to which our non-U.S. subsidiaries may be a party. Our business, financial condition and/or results of operations could be adversely impacted, possibly materially, if we are unable to successfully manage these and other risks of international operations.

If our international business increases relative to our total business, the materialization of these risks could have a more pronounced effect on our operating results or growth prospects.

Our growth strategy may involve opening or acquiring new offices and/or expanding, both domestically and internationally, and could involve hiring new Limited Partners and other senior professionals for these offices, which would require substantial investment by us and could materially adversely affect our operating results.

Our ability to grow our advisory business depends in part on our ability to open or acquire new offices, expand internationally and hire new Limited Partners and other senior professionals for these offices. We may not be successful in any efforts to open new offices, expand internationally or hire new Limited Partners and other senior professionals for these offices. The costs of opening a new office, expanding internationally and hiring the necessary personnel to staff any such office are substantial. If we are not successful in these efforts, we may not be able to recover our investments or our substantial cost outlays, and new international operations may not achieve profitability. To the extent that we pursue business opportunities in certain markets outside the United States, such as our business operations in the E.U., U.K., Canada, France and Germany, we will be subject to political, economic, legal, operational, regulatory and other risks that are inherent in operating in a foreign country, including risks of possible nationalization, expropriation, price controls, capital controls, exchange controls, inflation controls, licensing requirements and other restrictive governmental actions, as well as the outbreak of hostilities.

Depending upon the extent of our expansion, and whether it is done by recruiting new Limited Partners, strategic investment or acquisition, the incremental costs of our expansion may be funded from cash from operations, new share issuances or other financing alternatives. There can be no assurance that we will be able to generate or obtain sufficient capital on acceptable terms to fund our expansion needs which would limit our future growth and could have a material adverse effect on our business, financial condition and results of operations.

We may enter into new lines of business which may result in additional risks and uncertainties in our business.

We currently generate substantially all of our revenue from advisory engagements. However, we may grow our business by entering into new lines of business. Moreover, we currently derive a small portion of revenue through equity research, underwriting and trading services conducted through TPH.

 

75


Table of Contents

To the extent we enter into new lines of business or increase our focus on existing lines of business other than our advisory engagements, we will face numerous risks and uncertainties, including risks associated with actual or perceived conflicts of interest because we would no longer be limited to the advisory business, the possibility that we have insufficient expertise to engage in such activities profitably or without incurring inappropriate amounts of risk, the required investment of capital and other resources and the loss of clients due to the perception that we are no longer focusing on our business.

For instance, if we increasingly act as an underwriter in public offerings and other distributions of securities in order to support our advisory business, we may incur losses and be subject to reputational harm to the extent that, for any reason, we are unable to sell securities we purchased as an underwriter at the anticipated price levels. In addition, if we act as an underwriter, we may also be subject to liability for material misstatements or omissions in prospectuses and other offering documents relating to offerings we underwrite. In such cases, any indemnification provisions in the applicable underwriting agreement may not be available to us or may not be sufficient to protect us against losses arising from such liability. For a discussion of the conflicts of interest risks that may be associated with an increased focus on our equity research business, see “Risks Related to the Business of PWP—Our failure to deal appropriately with actual, potential or perceived conflicts of interest could damage our reputation and materially adversely affect our business” above.

Further, entry into certain new lines of business may subject us to new laws and regulations with which we are not familiar, or from which we are currently exempt, and may lead to increased litigation and regulatory risk. In addition, certain aspects of our cost structure, such as costs for compensation, occupancy, communication and information technology services, and depreciation and amortization will be largely fixed, and we may not be able to timely adjust these costs to match fluctuations in revenue related to our entering into new lines of business. If a new business generates insufficient revenues or if we are unable to efficiently manage our expanded operations, our business, financial condition and our results of operations could be materially adversely affected.

Fluctuations in foreign currency exchange rates could adversely affect our results.

Because our financial statements are denominated in U.S. dollars and we receive a portion of our net revenue in other currencies (including the Euro, pound sterling and Canadian dollars), we are exposed to fluctuations in foreign currencies. During the year ended December 31, 2020, 21.5% of revenue was received in currencies other than U.S. dollar. In addition, we pay certain of our expenses in such currencies. Fluctuations in foreign currency exchange rates can be unpredictable and may lead to losses in net cash. An appreciation or depreciation of any of these currencies relative to the U.S. dollar could result in an adverse or beneficial impact, respectively, to our financial results. We have not entered into any transactions to hedge our exposure to these foreign exchange fluctuations through the use of derivative instruments or otherwise.

The cost of compliance with international broker dealer, employment, labor, benefits and tax regulations may adversely affect our business and hamper our ability to expand internationally.

Since we operate our business both in the United States and internationally, we are subject to many distinct broker dealer, employment, labor, benefits and tax laws in each country in which we operate, including regulations affecting our employment practices and our relations with our employees and service providers. In addition, the data privacy and security framework of the E.U., the General Data Protection Regulations (the “GDPR”), took effect on May 25, 2018. As we engage in significant business in Europe, we are subject to the GDPR’s requirements. If we are required to comply with new regulations or new interpretations of existing regulations, or if we are unable to comply with these regulations or interpretations, our business could be adversely affected or the cost of compliance may

 

76


Table of Contents

make it difficult to expand into new international markets. Additionally, our competitiveness in international markets may be adversely affected by regulations requiring, among other things, the awarding of contracts to local contractors, the employment of local citizens and/or the purchase of services from local businesses or favoring or requiring local ownership.

The exit by the U.K. from the E.U. could adversely impact our business, operations and financial condition.

We have a presence in the U.K. and certain E.U. countries, including France and Germany. On January 31, 2020, the U.K. withdrew from the E.U., commonly referred to as “Brexit.” The U.K. remained in the E.U.’s customs union and single market until December 31, 2020 (the “Transition Period”). The U.K. and the E.U. agreed to a Trade and Cooperation Agreement on December 24, 2020 (the “TCA”), which is intended to be operative at the end of the Transition Period. The TCA was ratified by the U.K. on December 30, 2020 and is expected to come into full force once relevant E.U. institutions have also ratified the TCA. Until then, the TCA governs the U.K.’s relationship with the E.U. on an interim basis.

While the TCA regulates a number of important areas, significant parts of the U.K. economy are not addressed in detail by the TCA, including in particular the services sector, which represents the largest component of the U.K.’s economy. A number of issues, particularly in relation to the financial services sector, remain to be resolved through further bilateral negotiations, which are currently scheduled to take place over the first and second quarters of 2021. As a result, the new relationship between the U.K. and the E.U. could in the short-term, and possibly for longer, cause disruptions to and create uncertainty in the economy, which could in turn result in reduced corporate transactional activity that would negatively impact our business. In addition, there could be an adverse impact on the ability of our London office personnel to operate within the E.U. A failure to agree a sustainable and practical financial services regulatory relationship between the U.K. and the E.U., whether on the basis of equivalence, mutual recognition or otherwise, could harm our business, financial condition and results of operations.

A change in relevant income tax laws, regulations, or treaties, or an adverse interpretation of these items by tax authorities, could result in an audit adjustment or revaluation of our deferred tax assets that may cause our effective tax rate and tax liability to be higher than what is currently presented in the consolidated statements of financial condition.

As part of the process of preparing our consolidated statements of financial condition, we are required to estimate income taxes in each of the jurisdictions in which we operate. Significant management judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities, and any valuation allowance recorded against our deferred tax assets. This process requires us to estimate our actual current tax liability and to assess temporary differences resulting from differing book versus tax treatment. Our effective tax rate and tax liability is based on the application of current income tax laws, regulations, and treaties. These laws, regulations, and treaties are complex, and the manner in which they apply to our facts and circumstances is sometimes open to interpretation. We believe our application of current laws, regulations, and treaties to be correct and sustainable upon examination by the tax authorities. However, the tax authorities could challenge our interpretation resulting in additional tax liability or adjustment to our income tax provision that could increase our effective tax rate. In addition, tax laws, regulations, or treaties enacted in the future may cause us to revalue our net deferred tax assets and have a material change to our effective tax rate.

 

77


Table of Contents

Uncertainty relating to the London Interbank Offered Rate (“LIBOR”) calculation process and potential phasing out of LIBOR in the future may adversely affect the value of our outstanding debt instruments.

National and international regulators and law enforcement agencies have conducted investigations into a number of rates or indices known as “reference rates.” Actions by such regulators and law enforcement agencies may result in changes to the manner in which certain reference rates are determined, their discontinuance, or the establishment of alternative reference rates. In particular, the FCA has stated, as recently as July 1, 2020, that: “The interest rate benchmark LIBOR is expected to cease after end-2021.” Based on the foregoing, it appears highly likely that LIBOR will be discontinued or modified after 2021.

At this time, it is not possible to predict the effect that these developments, any discontinuance, modification or other reforms to LIBOR or any other reference rate, or the establishment of alternative reference rates may have on LIBOR, other benchmarks, or LIBOR-based debt instruments. Uncertainty as to the nature of such potential discontinuance, modification, alternative reference rates or other reforms may materially adversely affect the trading market for securities linked to such benchmarks. Furthermore, the use of alternative reference rates or other reforms could cause the interest rate calculated for our LIBOR-based debt instruments to be materially different than expected.

Risks Related to Perella Weinberg Partners’ Organizational Structure

The following risk factors apply to the business and operations of Perella Weinberg Partners. The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may adversely affect the ability to complete or realize the anticipated benefits of the Business Combination, and may have a material adverse effect on the business, cash flows, financial condition and results of operations of Perella Weinberg Partners. Unless the context otherwise requires, all references in this subsection to the “Company,” “we,” “us” or “our” refer to the business of PWP prior to the consummation of the Business Combination, and Perella Weinberg Partners following the consummation of the Business Combination.

Perella Weinberg Partners’ only material assets after the completion of the Business Combination will be its partnership interests in PWP OpCo and its equity interest in the general partner of PWP OpCo, PWP GP, and Perella Weinberg Partners is accordingly dependent upon distributions from PWP OpCo to pay dividends, taxes, make payments under the Tax Receivable Agreement and pay other expenses.

Perella Weinberg Partners will be a holding company, and its only material assets will be its partnership interests in PWP OpCo and its equity interest in PWP GP, the general partner of PWP OpCo. Perella Weinberg Partners has no independent means of generating revenue. Perella Weinberg Partners is accordingly dependent upon, and intends to cause PWP OpCo to make, distributions to its partners in an amount sufficient to cover all applicable taxes payable, other expenses payments under the Tax Receivable Agreement, Professional Partners’ indemnification claims with respect to the advisory business and dividends, if any, declared by us.

PWP OpCo is generally prohibited under Delaware law from making a distribution to a partner to the extent that, at the time of the distribution, after giving effect to the distribution, liabilities of PWP OpCo (with certain exceptions) exceed the fair value of its assets. Furthermore, certain subsidiaries of PWP OpCo may be subject to similar legal limitations on their ability to make distributions to PWP OpCo. Moreover, our regulated subsidiaries may be subject to regulatory capital requirements that limit the distributions that may be made by those subsidiaries.

 

78


Table of Contents

Deterioration in the financial condition, earnings or cash flow of PWP OpCo and its subsidiaries for any reason could limit or impair its ability to pay such distributions. PWP OpCo’s ability to make distributions to Perella Weinberg Partners will be dependent on its subsidiaries’ ability to pay dividends to it. Certain of its subsidiaries are SEC-registered broker-dealers and subject to regulatory capital requirements, which may restrict their ability to make distributions unless specified levels of regulatory capital are maintained. To the extent that Perella Weinberg Partners requires funds and PWP OpCo is restricted from making such distributions under applicable law or regulation or under the terms of financing arrangements, or is otherwise unable to provide such funds, our liquidity and financial condition could be materially adversely affected. See Information about PWP—Regulation.”

We will be required to pay our ILPs and/or Limited Partners for certain tax benefits we may claim as a result of the tax basis step-up we receive in connection with the Business Combination and related transactions, including subsequent exchanges of PWP OpCo Class A partnership units for cash or Perella Weinberg Partners Class A common stock. In certain circumstances, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual tax benefits we realize.

Our acquisition of Class A partnership units in PWP OpCo in connection with the Business Combination or pursuant to future exchanges of PWP OpCo Class A partnership units for shares of Perella Weinberg Partners Class A common stock or cash, and certain other transactions, are expected to result in increases in the tax basis of the assets of PWP OpCo and other deductions that otherwise would not have been available to us. Such increases in tax basis and other deductions are expected to reduce the amount of cash tax that we would otherwise have to pay in the future due to increases in depreciation and amortization deductions (for tax purposes). These increases in tax basis may also decrease gain (or increase loss) on future dispositions of certain assets of PWP OpCo to the extent the increased tax basis is allocated to those assets. The IRS may challenge all or part of these tax basis increases, and a court could sustain such a challenge.

At the Closing, the Company will enter into a Tax Receivable Agreement with PWP OpCo, Professional Partners and certain other persons party thereto. The Tax Receivable Agreement will generally provide for payment by the Company to ILPs and certain Partners (as defined therein) of 85% of the cash tax savings, if any, in U.S. federal, state, local and foreign income taxes and related interest realized (or deemed realized) in periods after the Closing as a result of (a) exchanges of interests in PWP OpCo for cash or stock of the Company and certain other transactions and (b) payments made under the Tax Receivable Agreement. The Company expects to retain the benefit of the remaining 15% of these cash tax savings. See “Proposal No. 1—The Business Combination Proposal—Related Agreements—Tax Receivable Agreement.” While the actual increase in tax basis, as well as the amount and timing of any payments under the Tax Receivable Agreement, will vary depending upon a number of factors, including the timing of exchanges, the price of shares of Perella Weinberg Partners Class A common stock at the time of the exchange, the extent to which such exchanges are taxable, future tax rates and the amount and timing of our income, we expect that, as a result of the size of the increases in the tax basis of the tangible and intangible assets of PWP OpCo attributable to our interests in PWP OpCo, during the expected term of the Tax Receivable Agreement, the payments that we may make under the Tax Receivable Agreement could be substantial.

The payment obligation under the Tax Receivable Agreement is our obligation and not an obligation of PWP OpCo. In addition, although we are not aware of any issue that would cause the IRS to challenge a tax basis increase or other benefits, the relevant ILPs and/or Limited Partners will not reimburse us for any payments that may previously have been made under the Tax Receivable Agreement if such basis increases or other benefits are subsequently disallowed, although excess payments made to any ILP and/or Limited Partner may be netted against payments otherwise to be made, if any, to the relevant party after our determination of such excess. As a result, in certain

 

79


Table of Contents

circumstances we could make payments to the relevant ILPs and/or Limited Partners under the Tax Receivable Agreement in excess of our cash tax savings. Our ability to achieve benefits from any tax basis increase or other benefits, and the payments to be made under the Tax Receivable Agreement, will depend upon a number of factors, as discussed above, including the timing and amount of our future income.

The Tax Receivable Agreement also provides that, upon a merger, asset sale or other form of business combination or certain other changes of control, our (or our successor’s) obligations with respect to exchanged or acquired Class A partnership units (whether exchanged or acquired before or after such change of control) would be based on certain assumptions, including that we would have sufficient taxable income to fully utilize the deductions arising from the increased tax deductions and tax basis and other benefits related to entering into the Tax Receivable Agreement, that certain loss carryforwards will be used within 15 years, and that any non-amortizable assets are deemed disposed of at the earlier of (i) when the relevant asset is sold or (ii) within 15 years.

Furthermore, upon a material breach of our obligations under the Tax Receivable Agreement that is not cured within the time period specified by the Tax Receivable Agreement or if, at any time, we elect an early termination of the Tax Receivable Agreement, we shall pay to each ILP and/or Limited Partner the present value, discounted at LIBOR (or a replacement agreed rate) plus 300 basis points as of such date, of all tax benefit payments due to such partner as of either the date the delivery of the early termination notice, in the case of an early termination, or as of the date of such breach, in the case of a material breach. The calculation of payments in such circumstances would also be based on certain assumptions, including, in addition to those described above with respect to a change of control, that federal, state, local, and foreign income tax rates will remain the same as those specified for such taxable year by the Internal Revenue Code of 1986, as amended (the “Code”), and other laws on the date of such breach or the early termination payment, that any non-amortizable assets shall be deemed disposed of within 15 years of the earlier of the basis adjustment for such asset or the date of breach or delivery of the early termination notice, and that any PWP OpCo Class A partnership units that have not been exchanged will be deemed exchanged for the market value of Perella Weinberg Partners Class A common stock at the time of termination or material breach. Consequently, it is possible, in the case of a change of control, early termination, or material breach, that the actual cash tax savings realized by us may be significantly less than the corresponding Tax Receivable Agreement payments.

PWP OpCo may make distributions of cash to us substantially in excess of the amounts we use to make distributions to our shareholders and to pay our expenses (including our taxes and payments under the Tax Receivable Agreement). To the extent we do not distribute such excess cash as dividends on Perella Weinberg Partners Class A common stock, the holders of PWP OpCo Class A partnership units would benefit from any value attributable to such cash as a result of their ownership of Perella Weinberg Partners Class A common stock upon a redemption or exchange of their Class A partnership units.

Under the amended and restated agreement of limited partnership of PWP OpCo, we will have the right (through our control of PWP GP, the general partner of PWP OpCo), subject to applicable law, to determine when distributions will be made to the partners of PWP OpCo and the amount of any such distributions. If we authorize a distribution, such distribution will be made to the partners of PWP OpCo pro rata in accordance with their respective ownership of partnership units. In accordance with the agreement of limited partnership of PWP OpCo, we intend to use best efforts to cause PWP OpCo to make sufficient cash distributions to the holders of partnership units of PWP OpCo to fund their tax obligations in respect of the income of PWP OpCo that is allocated to them.

 

80


Table of Contents

If we accumulate cash received as distributions from PWP OpCo in excess of the amounts that we need to pay any cash dividends declared by our board of directors, taxes and other expenses (including payments under the Tax Receivable Agreement), neither our organizational documents nor the amended and restated agreement of limited partnership of PWP OpCo will require us to distribute such excess cash. Our board of directors may, in its sole discretion, choose to use such excess cash for any purpose, including (i) to make additional distributions to the holders of Perella Weinberg Partners Class A common stock, (ii) to acquire additional newly-issued PWP OpCo Class A partnership units, and/or (iii) to repurchase outstanding shares of Perella Weinberg Partners Class A common stock. Unless and until our board of directors chooses, in its sole discretion, to make such a distribution, we will have no obligation to distribute such cash (or other available cash other than any declared dividend) to our stockholders. No adjustments to the redemption or exchange ratio of PWP OpCo Class A partnership units for shares of Perella Weinberg Partners Class A common stock will be made as a result of either (i) any cash distribution by us or (ii) any cash that we retain and do not distribute to our shareholders, in each case, to the extent such cash was received pursuant to a pro rata distribution by PWP OpCo. To the extent we do not distribute such cash as dividends on Perella Weinberg Partners Class A common stock and instead, for example, hold such cash balances or lend them to PWP OpCo, this may result in shares of Perella Weinberg Partners Class A common stock increasing in value relative to the PWP OpCo Class A partnership units. The holders of PWP OpCo Class A partnership units may benefit from any value attributable to such cash balances if they acquire shares of Perella Weinberg Partners Class A common stock in exchange for their Class A partnership units or if Perella Weinberg Partners acquires additional PWP OpCo Class A partnership units (whether from PWP OpCo or from holders of PWP OpCo Class A partnership units) at a price based on the market price of shares of Perella Weinberg Partners Class A common stock at the time. See “Proposal No. 1—The Business Combination Proposal—Related Agreements—Amended and Restated Agreement of Limited Partnership of PWP OpCo” for further information.

If Perella Weinberg Partners were deemed an “investment company” under the Investment Company Act of 1940 as a result of its ownership of PWP OpCo, applicable restrictions could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business.

If Perella Weinberg Partners were to cease participation in the management of PWP OpCo, its interests in PWP OpCo could be deemed an “investment security” for purposes of the Investment Company Act of 1940 (the “1940 Act”). Generally, a person is deemed to be an “investment company” if it owns investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S. government securities and cash items), absent an applicable exemption. Immediately following the Business Combination, Perella Weinberg Partners will have nominal assets and will have partnership interests in PWP OpCo and its equity interest in the general partner of PWP OpCo, PWP GP. A determination that this interest was an investment security could result in Perella Weinberg Partners being an investment company under the 1940 Act and becoming subject to the registration and other requirements of the 1940 Act. We intend to conduct our operations so that we will not be deemed an investment company. However, if we were to be deemed an investment company, restrictions imposed by the 1940 Act, including limitations on our capital structure and our ability to transact with affiliates, could make it impractical for us to continue our business as contemplated and have a material adverse effect on our business and the price of Perella Weinberg Partners Class A common stock.

PWP OpCo and PWP Capital have entered into various arrangements, including a master separation agreement, which contain cross-indemnification obligations of us and PWP Capital.

The master separation agreement that we entered into with PWP Capital, which holds the former asset management business of PWP OpCo prior to the PWP Separation, provides, among other

 

81


Table of Contents

things, that PWP Capital generally will indemnify us for losses that we incur relating to, arising out of or resulting from the business of PWP Capital and any payments with respect to joint liabilities to the extent they exceed 81.304% of such joint liabilities. In addition, we generally will indemnify PWP Capital for losses that PWP Capital incurs relating to our business and any payments with respect to joint liabilities to the extent they exceed 18.696% of such joint liabilities. We may not be able to recover any or all of the amount of any indemnified losses from PWP Capital should it be financially unable to perform under its indemnification obligations. In addition, we may be required to make substantial payments under our indemnity obligations to PWP Capital, which could materially adversely affect our results of operations and the price of Perella Weinberg Partners Class A common stock.

Our Second Amended and Restated Certificate of Incorporation could prevent us from benefiting from corporate opportunities that might have otherwise been available to us.

Our Second Amended and Restated Certificate of Incorporation, which is subject to the terms and provisions of the Stockholders Agreement, contains provisions related to corporate opportunities that may be of interest to us, Professionals GP, Professional Partners and their respective subsidiaries. It provides that Professional Partners and its subsidiaries, Professionals GP and its subsidiaries, the Sponsor and any of their respective affiliates (excluding Perella Weinberg Partners or any of its subsidiaries) (collectively, the “PWP Partner Group”) and their respective affiliates will not have any duty (fiduciary or otherwise) to refrain from engaging, directly or indirectly, in the same or similar business activities or lines of business as Perella Weinberg Partners, PWP OpCo or any of their respective subsidiaries and in the event that the PWP Partner Group acquires knowledge of a potential transaction or matter which may be a corporate opportunity for Perella Weinberg Partners, PWP OpCo or any of their respective subsidiaries and the PWP Partner Group or any of their respective affiliates, none of Perella Weinberg Partners, PWP OpCo or any of their respective subsidiaries shall have any expectancy in such corporate opportunity and the PWP Partner Group shall not have any duty to communicate or offer such corporate opportunity to Perella Weinberg Partners, PWP OpCo or any of their respective subsidiaries and may pursue such corporate opportunities for themselves or direct such corporate opportunity to another person, including one of their affiliates, in each case, to the fullest extent permitted by law. Furthermore, to the fullest extent permitted by law, in the event that a director or officer of Perella Weinberg Partners, PWP OpCo or any of their respective subsidiaries who is also a partner, principal, director, officer, member, manager, employee, consultant, independent contractor and/or other service provider of any of the PWP Partner Group acquires knowledge of a potential transaction or matter which may be a corporate opportunity for Perella Weinberg Partners, PWP OpCo or any of their respective subsidiaries and the PWP Partner Group or any of their respective affiliates, none of Perella Weinberg Partners, PWP OpCo or any of their respective subsidiaries shall have any expectancy in such corporate opportunity unless such corporate opportunity has expressly been offered to such person in his or her capacity as a director or officer of Perella Weinberg Partners in which case such opportunity shall belong to Perella Weinberg Partners. By becoming our stockholder, you will be deemed to have notice of and have consented to these provisions of our Second Amended and Restated Certificate of Incorporation that will be in effect at the completion of the Business Combination. See “Description of Securities Post-Business Combination—Corporate Opportunities.”

If PWP OpCo were to become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes, Perella Weinberg Partners and PWP OpCo could be subject to potentially significant tax inefficiencies, and Perella Weinberg Partners would not be able to recover payments previously made by it under the Tax Receivable Agreement even if the corresponding tax benefits were subsequently determined to have been unavailable due to such status.

We intend to operate such that PWP OpCo is treated as a partnership for U.S. federal income tax purposes and does not become a publicly traded partnership taxable as a corporation. A “publicly

 

82


Table of Contents

traded partnership” is a partnership the interests of which are traded on an established securities market or readily tradable on a secondary market or the substantial equivalent thereof. Under certain circumstances, exchanges of PWP OpCo units pursuant to the PWP OpCo amended and restated limited partnership agreement, which will be entered into in connection with the Closing, or other transfers of PWP OpCo units could cause PWP OpCo to be treated as a corporation. We intend to operate such that transfers of PWP OpCo units will not cause PWP OpCo to be treated as other than a partnership by providing for limitations on the ability of partners to exchange or otherwise transfer PWP OpCo units and providing each of the board of directors of Perella Weinberg Partners and PWP GP with certain rights to further limit exchanges or other transfers of PWP OpCo units as necessary to maintain the partnership status of PWP OpCo. However, there can be no assurance that this treatment will be respected.

If PWP OpCo were to become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes, significant tax inefficiencies could result for Perella Weinberg Partners and PWP OpCo, including as a result of Perella Weinberg Partners’ inability to file a consolidated U.S. federal income tax return with PWP OpCo. In addition, Perella Weinberg Partners may not be able to realize tax benefits covered under the Tax Receivable Agreement and would not be able to recover any payments previously made by it under the Tax Receivable Agreement, even if the corresponding tax benefits (including any claimed increase in the tax basis of PWP OpCo’s assets) were subsequently determined to have been unavailable.

The use of certain of Perella Weinberg Partners’ licensed trademarks by PWP Capital and its subsidiaries may expose us to reputational harm that could adversely affect our business should they take actions that damage the brand name.

We have licensed to PWP Capital and its subsidiaries the use of certain trademarks owned by Perella Weinberg Partners and its subsidiaries for use in connection with its asset management business that were in use by the PWP Capital business prior to the PWP Separation. As a result, there is a risk of reputational harm to us if PWP Capital and its subsidiaries use such trademarks and engage in poor business practices, experience adverse results or otherwise damage the reputational value of the “Perella Weinberg Partners” or “Tudor, Pickering, Holt & Co.” brand names. These risks could impair our operations, affect our reputation and adversely affect our business.

Risks Related to FTIV and the Business Combination

Our initial stockholders, directors and officers may have a conflict of interest in determining to pursue the Business Combination, since certain of their interests are different from or in addition to (and may conflict with) the interests of our public stockholders, and such interests may have influenced their decisions to approve the Business Combination and recommend that our stockholders approve the Business Combination Proposal.

Our initial stockholders, officers and directors have interests in and arising from the Business Combination that are different from or in addition to, and which may conflict with, the interests of our public stockholders, which may result in a conflict of interest, including the following:

 

   

the Sponsor will hold our common stock following the Business Combination, subject to lock-up agreements;

 

   

the Sponsor will hold placement warrants to purchase shares of our common stock following the Business Combination, subject to lock-up agreements;

 

   

the Sponsor paid an aggregate of $6,125,000 for its founder shares, placement shares and placement warrants and that such securities are expected to have a significantly higher value at the time of the Business Combination and will have little or no value if we do not complete the Business Combination;

 

83


Table of Contents
   

the Sponsor has waived its redemption rights with respect to its founder shares, placement shares and public shares in connection with the Business Combination, and have waived their redemption and liquidation rights with respect to their founder shares and placement shares if we are unable to complete a business combination by our Business Combination Outside Date;

 

   

if we are unable to complete a business combination by our Business Combination Outside Date, Cohen Sponsor Interests IV, LLC, the manager of the Sponsor, will be liable to ensure that the proceeds in the trust account are not reduced by the claims of target businesses or claims of vendors or other entities to which we owe money for services rendered or contracted for, or products sold to us, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the trust account, and excluding any claims under our indemnity of the underwriters of the IPO against certain liabilities, including liabilities under the Securities Act;

 

   

the Sponsor has agreed to loan us funds in an amount up to $500,000 for working capital requirements and to finance transaction costs in connection with an initial business combination, and any amounts outstanding under this loan will not be repaid if we are unable to complete a business combination by our Business Combination Outside Date; and

 

   

the continued indemnification of our current directors and officers and the continuation of directors’ and officers’ liability insurance after the Business Combination.

These interests may have influenced our directors in making their recommendation that you vote in favor of the Business Combination Proposal and the other proposals in this proxy statement.

Our directors and officers have discretion in agreeing to changes or waivers to the terms of the Business Combination Agreement and related transactions, which may result in a conflict of interest when determining whether such changes or waivers are appropriate and in our public stockholders’ best interest.

In the period leading up to the Closing, events may occur that, pursuant to the Business Combination Agreement, would require us to agree to amend the Business Combination Agreement, to consent to certain actions taken by PWP or to waive rights to which we are entitled to under the Business Combination Agreement. These events could arise because of changes in PWP’s business, a request by PWP to undertake actions that would otherwise be prohibited by the terms of the Business Combination Agreement or the occurrence of other events that would have a material adverse effect on PWP’s business and would entitle us to terminate the Business Combination Agreement. In any of such circumstances, it would be at our discretion, acting through our board of directors, to consent to such a request or action or waive such rights. The existence of the financial and personal interests of the directors described elsewhere in these risk factors may result in a conflict of interest on the part of one or more of the directors between what he or she may believe is best for the public stockholders and what he or she may believe is best for himself or herself in determining whether or not to take the requested action or waive our rights. As of the date of this proxy statement, we do not believe there will be any requests, actions or waivers that our directors and officers would be likely to make after stockholder approval of the Business Combination Proposal has been obtained. While certain changes could be made without further stockholder approval, we will circulate a new or amended proxy statement and resolicit our stockholders if changes to the terms of the Business Combination and related transactions that would have a material impact on our stockholders are required prior to the vote on the Business Combination Proposal.

 

84


Table of Contents

Our initial stockholders have agreed to vote in favor of the Business Combination, regardless of how our public stockholders vote.

Unlike many other blank check companies in which the founders agree to vote their founder shares in accordance with the majority of the votes cast by the public stockholders in connection with an initial business combination, our initial stockholders have agreed to vote any shares of our common stock owned by them in favor of our proposed initial business combination. As of the date hereof, our initial stockholders own approximately 26.9% of our issued and outstanding shares of common stock. Accordingly, it is more likely that the requisite stockholder approval will be received for the Business Combination than would be the case if our initial stockholders agreed to vote any shares of our common stock owned by them in accordance with the majority of the votes cast by our public stockholders.

Neither the FTIV board of directors nor any committee thereof obtained a third party valuation in determining whether or not to pursue the Business Combination.

Neither the FTIV board of directors nor any committee thereof is required to obtain an opinion from an independent investment banking or accounting firm that the price that we are paying for PWP is fair to us from a financial point of view. Neither the FTIV board of directors nor any committee thereof obtained a third party valuation in connection with the Business Combination. In analyzing the Business Combination, the FTIV board of directors conducted due diligence on PWP and reviewed comparisons of selected financial data of PWP with certain of its peers in the industry and the financial terms set forth in the Business Combination Agreement. The FTIV board of directors also consulted with the Company’s management and its legal counsel, financial advisor and other advisors and considered a number of factors, uncertainty and risks, including, but not limited to, those discussed under “Proposal No. 1—Approval of the Business Combination—FTIV’s Board of Directors’ Reasons for the Approval of the Business Combination,” and concluded that the Business Combination was in the best interest of FTIV’s stockholders. Accordingly, investors will be relying solely on the judgment of the FTIV Board in valuing PWP, and the FTIV Board may not have properly valued such businesses. The lack of a third party valuation may also lead an increased number of stockholders to vote against the Business Combination or demand redemption of their shares, which could potentially impact our ability to consummate the Business Combination

Following the Business Combination, our voting control will be concentrated among the holders of our Class B-1 common stock. As a result, the market price of our Class A common stock may be materially adversely affected by such disparate voting rights.

Following the completion of the Business Combination, (a) Professional Partners will beneficially own all of the outstanding shares of our Class B-1 common stock, representing approximately 90.6% of our total voting power, (b) ILPs will beneficially own all of the outstanding shares of our Class B-2 common stock, representing approximately 0.9% of our total voting power, and (c) holders of Class A common stock will own shares of our Class A common stock, representing approximately 8.5% of our total voting power. As long as Professional Partners beneficially owns a majority of our total voting power, it will have the ability, without the consent of the public holders of our Class A common stock, to elect all of the members of our board of directors and to control our management and affairs. In addition, it will be able to determine the outcome of matters submitted to a vote of our stockholders for approval and will be able to cause or prevent a change of control of us.

The holders of our Class A common stock and Class B common stock will have substantially identical rights, except that holders of Class A common stock and Class B-2 common stock will be entitled to one vote per share, while holders of Class B-1 common stock will be entitled to 10 votes per share on all matters to be voted on by stockholders in general. This differential in the voting rights of our Class B-1 common stock could adversely affect the market price of our Class A common stock.

 

85


Table of Contents

A market for our securities may not continue, which would adversely affect the liquidity and price of our securities.

Following the Business Combination, the price of our securities may fluctuate significantly due to the market’s reaction to the Business Combination and general market and economic conditions. An active trading market for our securities following the Business Combination may never develop or, if it develops, it may not be sustained.

Nasdaq may not list our securities on its exchange, and if they are listed we may be unable to satisfy listing requirements in the future, which could limit investors’ ability to effect transactions in our securities and subject us to additional trading restrictions.

As a result of the Business Combination, Nasdaq rules require that we apply to continue the listing of our Class A common stock and warrants. While we will apply to have our common stock and warrants listed on the Nasdaq upon consummation of the Business Combination, we will be required to meet Nasdaq’s initial listing requirements. We may be unable to meet those requirements. Even if our securities continue to be listed on the Nasdaq immediately following the Business Combination, we may be unable to maintain the listing of our securities in the future.

If we fail to meet the initial listing requirements and Nasdaq does not list our securities on its exchange, or if we are delisted, there could be significant material adverse consequences, including:

 

   

a limited availability of market quotations for our securities;

 

   

a limited amount of news and analyst coverage for the combined company; and

 

   

a decreased ability to obtain capital or pursue acquisitions by issuing additional equity or convertible securities.

PWP will incur significant costs and obligations as a result of being a public company.

As a privately held company, PWP has not been required to comply with many corporate governance and financial reporting practices and policies required of a publicly traded company. As a publicly traded company, the combined company will incur significant legal, accounting and other expenses that PWP was not required to incur in the past. These expenses will increase once the combined company is no longer an “emerging growth company” as defined under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). In addition, new and changing laws, regulations and standards relating to corporate governance and public disclosure for public companies, including Dodd Frank, the Sarbanes-Oxley Act, regulations related thereto and the rules and regulations of the SEC and Nasdaq, have increased the costs and the time that must be devoted to compliance matters. We expect these rules and regulations will increase our legal and financial costs and lead to a diversion of management time and attention from revenue-generating activities.

For as long as we remain an “emerging growth company” as defined in the JOBS Act, we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.” We may remain an “emerging growth company” until September 29, 2025 or such earlier time that we have more than $1.07 billion in annual revenues, have more than $700.0 million in market value of our common stock held by non-affiliates, or issue more than $1.0 billion of non-convertible debt over a three-year period. To the extent we choose not to use exemptions from various reporting requirements under the JOBS Act, or if we no longer can be classified as an “emerging growth company,” we expect that we will incur additional compliance costs, which will reduce our ability to operate profitably.

 

86


Table of Contents

As an “emerging growth company,” we cannot be certain if the reduced disclosure requirements applicable to “emerging growth companies” will make our common stock less attractive to investors.

As an “emerging growth company,” we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies,” including not being required to obtain an assessment of the effectiveness of our internal controls over financial reporting from our independent registered public accounting firm pursuant to Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We will cease to be an emerging growth company upon the earliest of: (i) the end of the fiscal year following the fifth anniversary of the closing of FTIV’s initial public offering, (ii) the first fiscal year after our annual gross revenues are $1.07 billion or more, (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities or (iv) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year. In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards, which we have elected to do.

We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active market for our common stock, our share price may be more volatile and the price at which our securities trade could be less than if we did not use these exemptions.

If we do not develop and implement all required accounting practices and policies, we may be unable to provide the financial information required of a United States publicly traded company in a timely and reliable manner.

As PWP is a privately held company, it has not been required to adopt all of the financial reporting and disclosure procedures and controls required of a United States publicly traded company. We expect that the implementation of all required accounting practices and policies and the hiring of additional financial staff will increase the operating costs of the combined company and could require the management of the combined company to devote significant time and resources to such implementation. If we fail to develop and maintain effective internal controls and procedures and disclosure procedures and controls, we may be unable to provide financial information and required SEC reports that are timely and reliable. Any such delays or deficiencies could harm us, including by limiting our ability to obtain financing, either in the public capital markets or from private sources and damaging our reputation, which in either case could impede our ability to implement our growth strategy. In addition, any such delays or deficiencies could result in our failure to meet the requirements for continued listing of our common stock on the Nasdaq.

We may issue additional shares of common stock or other equity securities without your approval, which would dilute your ownership interest in us and may depress the market price of our common stock.

We may issue additional shares of common stock or other equity securities in the future in connection with, among other things, future acquisitions, repayment of outstanding indebtedness or grants under the Incentive Plan without stockholder approval in a number of circumstances.

 

87


Table of Contents

Our issuance of additional common stock or other equity securities could have one or more of the following effects:

 

   

our existing stockholders’ proportionate ownership interest in us will decrease;

 

   

the amount of cash available per share, including for payment of dividends in the future, may decrease;

 

   

the relative voting strength of each previously outstanding share of common stock may be diminished; and

 

   

the market price of our common stock may decline.

Our warrants are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results.

On April 12, 2021, the staff of the Securities and Exchange Commission (the “SEC Staff”) issued a public statement entitled “Staff Statement on Accounting and Reporting Considerations for Warrants issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Staff Statement”). The SEC Staff Statement focused on certain settlement terms and provisions related to certain tender offers following a business combination. The terms described in the SEC Staff Statement are common in SPACs and are similar to the terms contained in the warrant agreement governing our warrants. In response to the SEC Staff Statement, we reevaluated the accounting treatment of our public warrants and private placement warrants, and determined to classify the warrants as derivative liabilities measured at fair value, with changes in fair value each period reported in earnings. As a result, included on our balance sheet as of December 31, 2020 contained elsewhere in this proxy statement are derivative liabilities related to embedded features contained within our warrants. Accounting Standards Codification 815, Derivatives and Hedging (“ASC 815”), provides for the remeasurement of the fair value of such derivatives at each balance sheet date, with a resulting non-cash gain or loss related to the change in the fair value being recognized in earnings in the statement of operations. As a result of the recurring fair value measurement, our financial statements and results of operations may fluctuate quarterly based on factors which are outside of our control. Due to the recurring fair value measurement, we expect that we will recognize noncash gains or losses on our warrants each reporting period and that the amount of such gains or losses could be material.

We have identified a material weakness in our internal control over financial reporting related to the accounting for the warrants we issued in connection with our initial public offering in September 2020. This material weakness could continue to adversely affect our ability to report our results of operations and financial condition accurately and in a timely manner.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Our management is likewise required, on a quarterly basis, to evaluate the effectiveness of our internal controls and to disclose any changes and material weaknesses identified through such evaluation in those internal controls. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

As described elsewhere in this proxy statement, we identified a material weakness in our internal control over financial reporting related to the accounting for the warrants we issued in connection with our initial public offering in September 2020. As a result of this material weakness, our management concluded that our internal control over financial reporting was not effective as of December 31, 2020. This material weakness resulted in a material misstatement of our warrant liabilities and related financial disclosures for the affected periods.

 

88


Table of Contents

To respond to this material weakness, we have devoted, and plan to continue to devote, significant effort and resources to the remediation and improvement of our internal control over financial reporting. While we have processes to identify and appropriately apply applicable accounting requirements, we plan to enhance these processes to better evaluate our research and understanding of the nuances of the complex accounting standards that apply to our financial statements. Our plans at this time include providing enhanced access to accounting literature, research materials and documents and increased communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects.

Any failure to maintain such internal control could adversely impact our ability to report our financial position and results from operations on a timely and accurate basis. If our financial statements are not accurate, investors may not have a complete understanding of our operations. Likewise, if our financial statements are not filed on a timely basis, we could be subject to sanctions or investigations by the stock exchange on which our common stock is listed, the SEC or other regulatory authorities. We may also be subject to litigation or other disputes which may include, among others, claims invoking the federal and state securities laws, contractual claims or other claims relating to our financial statements or the material weaknesses in our internal control over financial reporting. In either case, there could result a material adverse effect on our business. Ineffective internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our stock.

We can give no assurance that the measures we have taken and plan to take in the future will remediate the material weakness identified or that any additional material weaknesses or restatements of financial results will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting or circumvention of these controls. In addition, even if we are successful in strengthening our controls and procedures, in the future those controls and procedures may not be adequate to prevent or identify irregularities or errors or to facilitate the fair presentation of our financial statements.

If the combined company’s performance following the Business Combination does not meet market expectations, the price of our securities may decline.

If the combined company’s performance following the Business Combination does not meet market expectations, the price of our common stock may decline from the price of our common stock prior to the Closing. The market value of our common stock at the time of the Business Combination may vary significantly from the price on the date the Business Combination Agreement was executed, the date of this proxy statement, or the date on which our stockholders vote on the Business Combination. Because the number of shares of our common stock issued as consideration in the Business Combination will not be adjusted to reflect any changes in the market price of our common stock, the value of the shares of our common stock issued in the Business Combination may be higher or lower than the value of the same number of shares of our common stock on earlier dates.

In addition, following the Business Combination, fluctuations in the price of our common stock could contribute to the loss of all or part of your investment. Prior to the Business Combination, there has not been a public market for PWP’s stock, and trading in our common stock has not been active. Accordingly, the valuation ascribed to PWP and our common stock in the Business Combination may not be indicative of the price that will prevail in the trading market following the Business Combination. If an active market for our common stock develops and continues, the trading price of our common stock following the Business Combination could be volatile and subject to wide fluctuations in response to various factors, some of which are beyond our control. Any of the factors listed below could have a material adverse effect on your investment in our common stock and our common stock may trade at prices significantly below the price you paid for them.

 

89


Table of Contents

Factors affecting the trading price of our common stock following the Business Combination may include:

 

   

actual or anticipated fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us;

 

   

changes in the market’s expectations about our operating results;

 

   

our operating results failing to meet market expectations in a particular period;

 

   

changes in financial estimates and recommendations by securities analysts concerning us or the online automobile sales industry and market in general;

 

   

operating and stock price performance of other companies that investors deem comparable to us;

 

   

changes in laws and regulations affecting our business;

 

   

commencement of, or involvement in, litigation involving us;

 

   

changes in our capital structure, such as future issuances of securities or the incurrence of additional debt;

 

   

the volume of shares of our common stock available for public sale;

 

   

any significant change in our board or management;

 

   

sales of substantial amounts of common stock by our directors, executive officers or significant stockholders or the perception that such sales could occur; and

 

   

general economic and political conditions such as recessions, interest rates, fuel prices, international currency fluctuations and acts of war or terrorism.

Broad market and industry factors may depress the market price of our common stock irrespective of our operating performance. The stock market in general and Nasdaq have experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our securities, may not be predictable. A loss of investor confidence in our market or the stocks of other companies which investors perceive to be similar to us could depress our stock price regardless of our business, prospects, financial conditions or results of operations. A decline in the market price of our common stock also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.

PWP is a private company and as such little information is publicly available regarding PWP. This may result in the Business Combination not being as profitable as we expect, or at all.

While we have conducted due diligence on PWP, very little public information exists about private companies. As a result, the Business Combination could be less profitable than we expect, or at all. Furthermore, the relative lack of information about a private company may hinder our ability to properly assess the value of PWP which could result in our overpaying.

Even if we consummate the Business Combination, the public warrants may never be in the money, and they may expire worthless.

The exercise price for our warrants is $11.50 per share. There can be no assurance that the public warrants will be in the money prior to their expiration and, as such, the warrants may expire worthless.

 

90


Table of Contents

The terms of our warrants may be amended in a manner that may be adverse to the holders. The warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of at least 65% of the then outstanding public warrants to make any change that adversely affects the interests of the registered holders. Accordingly, we may amend the terms of the warrants in a manner adverse to a holder if holders of at least 65% of the then outstanding public warrants approve of such amendment. Our ability to amend the terms of the warrants with the consent of at least 65% of the then outstanding public warrants is unlimited. Examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, shorten the exercise period or decrease the number of shares of our common stock purchasable upon exercise of a warrant.

We may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.

We have the ability to redeem outstanding warrants (excluding any placement warrants held by the Sponsor or their permitted transferees) at any time after they become exercisable and prior to their expiration, at $0.01 per warrant, provided that the last reported sales price (or the closing bid price of our common stock in the event the shares of our common stock are not traded on any specific trading day) of the common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations and the like) on each of 20 trading days within the 30 trading-day period ending on the third business day prior to the date on which we send proper notice of such redemption, provided that on the date we give notice of redemption and during the entire period thereafter until the time we redeem the warrants, we have an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to them is available. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of the outstanding warrants could force a warrant holder: (i) to exercise its warrants and pay the exercise price therefore at a time when it may be disadvantageous for it to do so, (ii) to sell its warrants at the then-current market price when it might otherwise wish to hold its warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, will be substantially less than the market value of its warrants.

Warrants to purchase our common stock will become exercisable following the Business Combination, which could increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders.

Outstanding warrants to purchase an aggregate of 7,870,000 shares of our common stock will become exercisable on the 30th day following the Closing in accordance with the terms of the warrant agreement governing those securities. These warrants consist of 7,666,666.67 warrants originally included in the units issued in our IPO and 203,333.33 warrants included in the placement units. Each warrant entitles its holder to purchase one share of our common stock at an exercise price of $11.50 per share and will expire at 5:00 p.m., New York time, five years after the Closing or earlier upon redemption of our common stock or our liquidation. To the extent warrants are exercised, additional shares of our common stock will be issued, which will result in dilution to our then existing stockholders and increase the number of shares eligible for resale in the public market. Sales of substantial numbers of such shares in the public market could depress the market price of our common stock.

 

91


Table of Contents

Our stockholders will experience immediate dilution due to the issuance of common stock to the PWP stockholders as consideration in the Business Combination. Having a minority share position likely reduces the influence that our current stockholders have on the management of the combined company.

Based on PWP’s current capitalization, we anticipate issuing an aggregate of approximately 50.2 million shares of our Class A common stock, Class B-1 common stock and Class B-2 common stock to the PWP stockholders as consideration in the Business Combination. It is anticipated that, upon completion of the Business Combination, based upon the As Exchanged Class A Share Ownership Assumptions: (1) the Company’s public stockholders would own approximately 24.7% of our outstanding Class A common stock; (2) the PIPE Investors (including the Sponsor Related PIPE Investors) would own approximately 13.4% of our outstanding Class A common stock (assuming an issuance of 12,500,000 shares of Class A common stock); (3) the Sponsor and our other Initial Stockholders would own approximately 8.0% of our outstanding Class A common stock; (4) Professional Partners would own approximately 49.1% of our outstanding Class A common stock; and (5) certain ILPs would own approximately 4.8% of our outstanding Class A common stock. If the actual facts are different from the As Exchanged Class A Share Ownership Assumptions, the above levels of ownership interest will be different.

If any shares of our common stock are redeemed in connection with the Business Combination, the percentage of our outstanding common stock held by our public stockholders will decrease and the percentages of our outstanding common stock held immediately following the Closing by each of our initial stockholders and the PWP stockholders will increase. See the section entitled “Summary of the Proxy Statement—Impact of the Business Combination on the Company’s Public Float” and “Unaudited Pro Forma Combined Financial Information” for further information. To the extent that any of the outstanding warrants or options are exercised for shares of our common stock, or awards are issued under the proposed Incentive Plan, our existing stockholders may experience substantial dilution. Such dilution could, among other things, limit the ability of our current stockholders to influence our management through the election of directors following the Business Combination. Additionally, on the date that is 45 days following the closing date of the Business Combination, Redeeming Holders are entitled to receive a Top-Up Payment. In PWP’s sole discretion, the Top-Up Payment may be made in cash or shares of Perella Weinberg Partners Class A common stock or any combination thereof, which may cause our existing stockholders to experience substantial dilution, see “Certain Relationships and Related Persons Transactions—PWP’s Related Party Transactions—Convertible Notes.”

Following the completion of the Business Combination, (a) Professional Partners will beneficially own all of the outstanding shares of our Class B-1 common stock, representing approximately 90.6% of our total voting power, (b) ILPs will beneficially own all of the outstanding shares of our Class B-2 common stock, representing approximately 0.9% of our total voting power, and (c) holders of Class A common stock will own shares of our Class A common stock, representing approximately 8.5% of our total voting power.

Our stockholders may be diluted by the future issuance of common stock, preferred stock or securities convertible or exchangeable into common or preferred stock, in connection with our incentive plans, acquisitions, capital raises or otherwise.

After the Closing, we would have approximately 1,456 million shares of Class A common stock authorized but unissued in the No Redemptions Scenario or approximately 1,472 million shares of Class A common stock authorized but unissued in the Maximum Redemptions Scenario. Our Second Amended and Restated Certificate of Incorporation to become effective upon the Closing authorizes us to issue these shares of common stock and options, rights, warrants and appreciation rights relating to

 

92


Table of Contents

common stock for the consideration and on the terms and conditions established by our board of directors in its sole discretion, whether in connection with acquisitions or otherwise.

In the future, we expect to obtain financing or to further increase our capital resources by issuing additional shares of our capital stock or offering debt or other equity securities, including senior or subordinated notes, debt securities convertible into equity, or shares of preferred stock. Issuing additional shares of our capital stock, other equity securities, or securities convertible into equity may dilute the economic and voting rights of our existing stockholders, reduce the market price of our Class A common stock, or both. Debt securities convertible into equity could be subject to adjustments in the conversion ratio pursuant to which certain events may increase the number of equity securities issuable upon conversion. Preferred stock, if issued, could have a preference with respect to liquidating distributions or a preference with respect to dividend payments that could limit our ability to pay dividends to the holders of our Class A common stock. Our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, which may adversely affect the amount, timing, or nature of our future offerings. As a result, holders of our Class A common stock bear the risk that our future offerings may reduce the market price of our Class A common stock and dilute their percentage ownership.

We expect to incur significant, non-recurring costs in connection with consummating the Business Combination and related transactions.

We expect to incur significant, non-recurring costs in connection with consummating the Business Combination and related transactions. We will pay all fees, expenses and costs we incur or incurred on our behalf in connection with the Business Combination Agreement and the transactions contemplated thereby (including the Business Combination). Additionally, the Business Combination Agreement provides that if the Business Combination is consummated, we will pay all fees, expenses and costs incurred by PWP or on PWP’s behalf, subject to certain limited exceptions, in connection with the Business Combination Agreement and the transactions contemplated thereby (including the Business Combination). We currently estimate that transaction expenses will be approximately $38 million (excluding transaction-related bonuses), including post-closing expenses that will be paid by the combined company.

If we are unable to complete the Business Combination or another initial business combination by our Business Combination Outside Date, we will cease all operations except for the purpose of winding up our affairs, redeem our outstanding public shares and dissolve and liquidate. In such event, third parties may bring claims against us and, as a result, the proceeds held in the trust account could be reduced and the per share liquidation price received by our stockholders could be less than $10.00 per share.

Our Existing Certificate of Incorporation provides that we must complete the Business Combination or another initial business combination by our Business Combination Outside Date, or we must cease all operations except for the purposes of winding up, redeem our outstanding public shares and, subject to approval by our remaining stockholders and our board, dissolve and liquidate. In such event, third parties may bring claims against us for monies we owe for products or services provided to us. Although we have obtained waiver agreements from PWP and from certain vendors and service providers that we have engaged and to which we owe money pursuant to which such parties have waived any right, title, interest or claim of any kind they may have in or to any monies held in the trust account, there is no guarantee that they or other vendors who did not execute such waivers will not seek recourse against the trust account notwithstanding such agreements. Furthermore, there is no guarantee that a court will uphold the validity of such agreements. Accordingly, the proceeds held in the trust account could be subject to claims, which could take priority over those of our public stockholders. If we are unable to complete the Business Combination or another business combination

 

93


Table of Contents

within the required time period, Cohen Sponsor Interests IV, LLC, the manager of our sponsor, has agreed it will be liable to ensure that the proceeds in the trust account are not reduced by the claims of target businesses or claims of vendors or other entities to which we owe money for services rendered or contracted for or products sold to us, but only if such a vendor or prospective target business does not execute such a waiver. However, he may not be able to meet such obligation. Therefore, the per share distribution from the trust account in such a situation may be less than $10.00 due to such claims.

Additionally, if we are forced to file a bankruptcy case or an involuntary bankruptcy case is filed against us which is not dismissed, or if we otherwise enter compulsory or court supervised liquidation, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in its bankruptcy estate and subject to the claims of third parties with priority over the claims of its stockholders. To the extent any bankruptcy claims deplete the trust account, the per share distribution from the trust account may be less than $10.00.

Our directors may decide not to enforce the indemnification obligations of Cohen Sponsor Interests IV, LLC, resulting in a reduction in the amount of funds in the trust account available for distribution to our public stockholders.

If proceeds in the trust account are reduced below $10.00 per public share and Cohen Sponsor Interests IV, LLC asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against Cohen Sponsor Interests IV, LLC to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against Cohen Sponsor Interests IV, LLC to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment and subject to their fiduciary duties may choose not to do so in any particular instance. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to our public stockholders may be reduced below $10.00 per share.

We may not have sufficient funds to satisfy indemnification claims of our directors and executive officers.

We have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors have agreed to waive any right, title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against the trust account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we have sufficient funds outside of the trust account or (ii) we consummate the Business Combination. Our obligation to indemnify our officers and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder’s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant to these indemnification provisions.

Our stockholders may be held liable for claims by third parties against us to the extent of distributions received by them.

If we are unable to complete the Business Combination or another initial business combination within the required time period, we must dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. We cannot assure you that we will properly assess all claims that may be potentially brought against us,

 

94


Table of Contents

nor can we assure you that third parties will not seek to recover from our stockholders amounts owed to them by us. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend well beyond the third anniversary of the date of distribution.

If we are forced to file a bankruptcy case or an involuntary bankruptcy case is filed against us which is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover all amounts received by our stockholders. Furthermore, because we intend to distribute the proceeds held in the trust account to our public stockholders promptly after our Business Combination Outside Date, if we do not consummate the Business Combination, this may be viewed or interpreted as giving preference to our public stockholders over any potential creditors with respect to access to or distributions from our assets. Moreover, our board may be viewed as having breached its fiduciary duties to our creditors and/or having acted in bad faith, and thereby exposing the board and us to claims for punitive damages, by paying public stockholders from the trust account prior to addressing the claims of creditors. We cannot assure you that claims will not be brought against us or you for these reasons.

Actions taken by the initial stockholders, our officers and directors to increase the likelihood of approval of the Business Combination Proposal and the other proposals presented in this proxy statement could have a depressive effect on the price of our common stock.

At any time prior to the Special Meeting, during a period when they are not then aware of any material nonpublic information regarding us or our securities, the initial stockholders, our directors, officers and their respective affiliates may enter into agreements to purchase shares from institutional and other investors who vote, or indicate an intention to vote, against the Business Combination Proposal, or enter into transactions with such investors and others to provide them with incentives to acquire shares of our common stock or vote their shares in favor of the Business Combination Proposal. While the exact nature of any other incentive arrangements that may be entered into in the future has not been determined as of the date of this proxy statement, they might include, without limitation, arrangements to protect such investors or holders against potential loss in value of their shares, including the granting of put options and the transfer to such investors or holders of shares owned by the initial stockholders for nominal value. The purpose of such purchases and other transactions would be to increase the likelihood that the Business Combination Proposal is approved and to decrease the likelihood that holders request redemption of public shares. Entering into any such arrangements may have a depressive effect on the price of our common stock. For example, if as a result of these arrangements an investor or holder purchases shares for nominal value, the investor or holder may be more likely to sell such shares immediately following the Closing for a price below market value.

We may not be able to timely and effectively implement controls and procedures required by Section 404 of the Sarbanes-Oxley Act of 2002, which could have a material adverse effect on our business.

Commencing with our annual report for the year ended December 31, 2021, we are and following the Business Combination, the combined company will be, required to provide management’s attestation on internal controls. The standards required for a public company under Section 404 of the Sarbanes-Oxley Act are significantly more stringent than those required of PWP as a privately-held company. Management may not be able to effectively and timely implement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements that will be applicable to the combined company after the Business Combination. If we are not able to implement the additional requirements of Section 404 in a timely manner or with

 

95


Table of Contents

adequate compliance, we may not be able to assess whether our internal controls over financial reporting are effective, which may subject us to adverse regulatory consequences and could harm investor confidence and lead to a decrease in the market price of our common stock.

Pursuant to the JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act for so long as we are an “emerging growth company.”

Section 404 of the Sarbanes-Oxley Act requires annual management assessments of the effectiveness of our internal control over financial reporting, and generally requires in the same report a report by our independent registered public accounting firm on the effectiveness of our internal control over financial reporting. However, under the JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act until we are no longer an “emerging growth company.” We will be an “emerging growth company” until the earlier of (1) the last day of the fiscal year (a) following September 29, 2025, the fifth anniversary of our IPO, (b) in which we have total annual gross revenue of at least $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our prior second fiscal quarter, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. Accordingly, until we cease being an “emerging growth company” stockholders will not have the benefit of an independent assessment of the effectiveness of our internal control environment.

Our ability to successfully effect the Business Combination and successfully operate the business thereafter will depend largely upon the efforts of certain key personnel, including the key personnel of PWP, all of whom we expect to stay with the combined company following the Business Combination. The loss of such key personnel could adversely affect the operations and profitability of the post-combination business.

Our ability to recognize certain benefits of the Business Combination and successfully operate PWP’s business following the Business Combination will depend upon the efforts of certain key personnel of PWP. Although we expect all of such key personnel to remain with the combined company following the Business Combination, the unexpected loss of key personnel may adversely affect the operations and profitability of the combined company. In addition, our future success depends in part on our ability to identify and retain key personnel to succeed senior management. Furthermore, while we have closely scrutinized the skills, abilities and qualifications of the key PWP personnel that will be employed by the combined company, our assessment may not prove to be correct. If such personnel do not possess the skills, qualifications or abilities we expect or those necessary to manage a public company, the operations and profitability of the combined company business may be negatively impacted.

Following the Business Combination, our ability to meet expectations and projections in any research or reports published by securities or industry analysts, or a lack of coverage by securities or industry analysts, could result in a depressed market price and limited liquidity for our common stock.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts may publish about us, our business, our market, or our competitors. If no securities or industry analysts commence coverage of the combined company, our stock price would likely be less than that which we would obtain if we had such coverage and the liquidity, or trading volume of our common stock may be limited, making it more difficult for a stockholder to sell shares at an acceptable price or amount. If any analysts do cover the combined company, their projections may

 

96


Table of Contents

vary widely and may not accurately predict the results we actually achieve. Our share price may decline if our actual results do not match the projections of research analysts covering us. Similarly, if one or more of the analysts who write reports on us downgrades our stock or publishes inaccurate or unfavorable research about our business, our share price could decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, our share price or trading volume could decline.

Future sales of our common stock issued to PWP stockholders or by our initial stockholders may reduce the market price of our common stock that you might otherwise obtain.

Under the Business Combination Agreement, we will issue (A) to Professional Partners, new shares of Class B-1 common stock, which will have 10 votes per share (for so long as Professional Partners or its limited partners as of the Closing maintain direct or indirect ownership of at least 10% of the issued and outstanding Class A partnership units of PWP OpCo, at which point such Class B-1 common stock shall have one vote per share) and (B) to ILPs, new shares of Class B-2 common stock, which will have one vote per share, with the number of shares of such common stock to be issued to equal the number of common units of PWP OpCo that will be held by Professional Partners and such ILPs, respectively, following the Closing, but prior to redemption of certain electing ILPs and Legacy Partners.

We and Professional Partners will enter into a Stockholders Agreement providing for certain restrictions on transfer applicable to the shares issued to Professional Partners in connection with the Business Combination. For additional information regarding the Stockholders Agreement, see the sections in this proxy statement entitled “Proposal No. 1—The Business Commination Proposal—Related Agreements—Rights of Professional Partners and Stockholders Agreement.”

The Sponsor is a party to a letter agreement, dated September 24, 2020 (the “Sponsor Lock-Up Agreement”), pursuant to which the Sponsor is prohibited from, except in limited circumstances, (i) selling, offering to sell, contracting or agreeing to sell, hypothecating, pledging, granting any option to purchase or otherwise disposing of or agreeing to dispose of, directly or indirectly, or establishing or increasing a put equivalent position or liquidating or decreasing a call equivalent position within the meaning of Section 16 of the Exchange Act with respect to the placement units, placement shares, placement warrants, or shares of common stock underlying the placement warrants, (ii) entering into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of the placement units, placement shares, placement warrants, or shares of common stock underlying the placement warrants, whether any such transaction is to be settled by delivery of the common stock or such other securities, in cash or otherwise, or (iii) publicly announcing any intention to effect any transaction specified in clause (c)(i) or (c)(ii), for a period of 30 days following the Business Combination.

We will, at or prior to the Closing, amend and restate the existing registration rights agreement with the Sponsor by entering into an amended and restated registration rights agreement (the “Amended and Restated Registration Rights Agreement”) with Sponsor, Professional Partners, the ILPs and others party thereto (the “RRA Parties”) with respect to the shares of our Class A common stock and certain other equity securities held by the RRA Parties. The Amended and Restated Registration Rights Agreement will require us to, among other things, file with the SEC a resale shelf registration statement pursuant to Rule 415 under the Securities Act on behalf of the RRA Parties within 30 business days after the Closing (the “Shelf Registration Statement”). If the Shelf Registration Statement becomes unavailable once it is declared effective, the RRA Parties will have certain demand registration rights.

Upon expiration of the lockup periods set forth in the Sponsor Share Surrender and Share Restriction Agreement, as amended, and the Sponsor Lock-Up Agreement applicable to shares of our

 

97


Table of Contents

common stock held by the PWP stockholders or our initial stockholders and, in the case of our initial stockholders, the effectiveness of the Shelf Registration Statement, these parties may sell large amounts of our stock in the open market or in privately negotiated transactions. The registration and availability of such a significant number of shares of common stock for trading in the public market may increase the volatility in the price of our common stock or put significant downward pressure on the price of our common stock. In addition, the combined company may use shares of our common stock as consideration for future acquisitions, which could further dilute our stockholders.

Subsequent to the consummation of the Business Combination, the combined company may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and stock price, which could cause you to lose some or all of your investment.

Although we have conducted a due diligence examination of PWP, we cannot assure you that this examination revealed all material issues that may be present in PWP’s business, or that factors outside of our and PWP’s control will not later arise. As a result, we may be forced to later write down or write off assets, restructure the combined company’s operations, or incur impairment or other charges that could result in losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about the combined company or its securities. In addition, charges of this nature may cause us to be unable to obtain future financing on favorable terms or at all.

The combined company may be subject to securities litigation, which is expensive and could divert management attention.

Following the Business Combination, our share price may be volatile and, in the past, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. The combined company may be the target of this type of litigation in the future. Litigation of this type could result in substantial costs and diversion of management’s attention and resources, which could have a material adverse effect on business, financial condition, results of operations and prospects. Any adverse determination in litigation could also subject the combined company to significant liabilities.

The classification of our board of directors may have anti-takeover effects, including discouraging, delaying or preventing our change of control.

Our board of directors is currently divided into two classes serving staggered, two-year terms, and if the Charter Proposals are approved, the board of the combined company will consist of three classes of directors with staggered, three-year terms. The presence of a classified board could have anti-takeover effects, including discouraging a third party from making a tender offer for our shares or attempting to obtain control of us, even when stockholders may consider such a takeover to be in their best interests. It could also delay stockholders who disapprove of the performance of our board of directors from changing a majority of the composition of our board of directors through a single proxy contest.

Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, investments and results of operations.

We are subject to laws and regulations enacted by national, regional and local governments, including in particular, reporting and other requirements under the Exchange Act. Compliance with, and

 

98


Table of Contents

monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could result in fines, injunctive relief or similar remedies which could be costly to us or limit our ability to operate post-Business Combination.

Control of Perella Weinberg Partners by Professional Partners may give rise to actual or perceived conflicts of interest with the Limited Partners who manage Professional Partners.

Upon consummation of the Business Combination, Perella Weinberg Partners will be controlled by Professional Partners, which is ultimately managed by a committee of Limited Partners that manages Professionals GP, the general partner of Professional Partners. The interests of the Limited Partners who manage Professional Partners may differ from those of Perella Weinberg Partners’ other stockholders. For example, the Limited Partners who manage Professional Partners may have a different tax position from Perella Weinberg Partners, which could influence their decisions regarding whether and when Perella Weinberg Partners should dispose of assets or incur new or refinance existing indebtedness, especially in light of the existence of the Tax Receivable Agreement that Perella Weinberg Partners will enter into in connection with the Business Combination, and whether and when Perella Weinberg Partners should undergo certain changes of control within the meaning of the Tax Receivable Agreement or terminate the Tax Receivable Agreement. In addition, the structuring of future transactions may take into consideration these tax or other considerations even where no similar benefit would accrue to us. For additional information on the Tax Receivable Agreement, see “Proposal No. 1—The Business Combination Proposal—Related Agreements—Tax Receivable Agreement.” Upon consummation of the Business Combination, Professional Partners, which is ultimately managed by a committee of Limited Partners that manages Professionals GP, the general partner of Professional Partners, will hold all outstanding shares of Class B-1 common stock and thereby control approximately 90.6% of the voting interest in Perella Weinberg Partners. The shares of Class B-1 common stock will entitle Professional Partners to (i) for so long as the Class B Condition is satisfied, ten votes per share for each share held of record on all matters submitted to a vote of stockholders and (ii) after the Class B Condition ceases to be satisfied, one vote per share for each share held of record on all matters submitted to a vote of stockholders. See “Description of Securities Post-Business Combination—Class B Common Stock.” In addition, in connection with the consummation of the Business Combination, Perella Weinberg Partners will enter into a Stockholders Agreement with Professional Partners, pursuant to which, for so long as the Class B Condition is satisfied, Professional Partners will have certain approval rights over certain transactions, including the right to designate a number of nominees to our board of directors equal to a majority thereof. For so long as the Class B Condition is no longer satisfied and the Secondary Class B Condition is satisfied, Professional Partners will have the right to designate a number of directors (rounded up to the nearest whole number) equal to one third of our board of directors. See “Proposal No. 1—The Business Combination Proposal—Related Agreements—Rights of Professional Partners and Stockholders Agreement.” As a result, because the Limited Partners who manage Professional Partners will have a majority of the voting power in Perella Weinberg Partners through their control of Professional Partners, and Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation to be in effect upon consummation of the Business Combination will not provide for cumulative voting, they will have the ability to elect all of the members of Perella Weinberg Partners’ board of directors and thereby to control its management and affairs, including determinations with respect to acquisitions, dispositions, borrowings, issuances of Perella Weinberg Partners Class A common stock or other securities, and the declaration and payment of dividends. The Limited Partners who manage Professional Partners will be able to determine the outcome of all matters requiring stockholder approval and will be able to cause or prevent a change of control of Perella Weinberg Partners or a change in the composition of its board of directors and could preclude any unsolicited acquisition of

 

99


Table of Contents

Perella Weinberg Partners. The voting power of the Limited Partners who manage Professional Partners could deprive Perella Weinberg Partners’ stockholders of an opportunity to receive a premium for their Perella Weinberg Partners Class A common stock as part of a sale of Perella Weinberg Partners and might ultimately affect the market price of Perella Weinberg Partners Class A common stock. As a result of the control exercised by the Limited Partners who manage Professional Partners over Perella Weinberg Partners, none of the Perella Weinberg Partners agreements with them have been negotiated on “arm’s length” terms. We cannot assure you that Perella Weinberg Partners would not have received more favorable terms from an unaffiliated party.

Upon consummation of the Business Combination, Perella Weinberg Partners will be a “controlled company” within the meaning of the rules of Nasdaq and, as a result, will qualify for, and intend to rely on, exemptions from certain corporate governance requirements. You will not have the same protections afforded to stockholders of companies that are subject to such requirements.

Upon consummation of the Business Combination, Professional Partners will hold more than 50% of the voting power of Perella Weinberg Partners’ shares eligible to vote. As a result, Perella Weinberg Partners will be a “controlled company” under the rules of Nasdaq. Under these rules, a company of which more than 50% of the voting power in the election of directors is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including the requirements that (i) a majority of the board of directors consist of independent directors and (ii) the board of directors have compensation and nominating and corporate governance committees composed entirely of independent directors.

For at least some period following the Business Combination, Perella Weinberg Partners intends to utilize these exemptions. As a result, immediately following the Business Combination Perella Weinberg Partners will not have a majority of independent directors on its board of directors and will not have a nominating and governance committee. Accordingly, although Perella Weinberg Partners may transition to a board with a majority of independent directors prior to the time Perella Weinberg Partners ceases to be a “controlled company,” for such period of time you will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements set by Nasdaq. In the event that Perella Weinberg Partners ceases to be a “controlled company” and its shares continue to be listed on Nasdaq, Perella Weinberg Partners will be required to comply with these provisions within the applicable transition periods. These exemptions do not modify the independence requirements for Perella Weinberg Partners’ audit committee, and Perella Weinberg Partners intends to comply with the applicable requirements of the SEC and Nasdaq with respect to Perella Weinberg Partners’ audit committee within the applicable time frame.

The historical consolidated and unaudited pro forma financial information in this proxy statement is not representative of the results Perella Weinberg Partners would have achieved as a stand-alone public company and may not permit you to predict its future results.

The historical consolidated and unaudited pro forma financial information in this proxy statement does not reflect the financial condition, results of operations or cash flows that Perella Weinberg Partners would have achieved as a stand-alone public company during the periods presented or those it will achieve in the future as a result of (i) the expense allocations for certain support functions that are provided on a centralized basis within PWP OpCo prior to the PWP Separation, such as expenses for business technology, facilities, legal, finance, human resources and business development, which are reflected in PWP’s historical consolidated financials and may be higher or lower than the comparable expenses that it would have actually incurred, or will incur in the future, as a stand-alone company and (ii) the added costs Perella Weinberg Partners expects to incur as a public company, including costs related to public company reporting, investor relations and compliance with the

 

100


Table of Contents

Sarbanes-Oxley Act of 2002. As a result of these matters, among others, it may be difficult for investors to compare Perella Weinberg Partners’ future results to historical results or to evaluate its relative performance or trends in its business.

The market price of Perella Weinberg Partners Class A common stock may be volatile, which could cause the value of your investment to decline.

Securities markets worldwide experience significant price and volume fluctuations. This market volatility, as well as general economic, market or political conditions, could reduce the market price of Perella Weinberg Partners Class A common stock in spite of its operating performance. In addition, Perella Weinberg Partners operating results could be below the expectations of public market analysts and investors, and in response, the market price of Perella Weinberg Partners Class A common stock could decrease significantly. Investors may be unable to resell their shares of Perella Weinberg Partners Class A common stock at or above the price they paid prior to the Closing.

Anti-takeover provisions in Perella Weinberg Partners’ charter documents and Delaware law, as well as the rules of FINRA, the FCA, the Alberta Commission, IIROC, ACPR and other U.S. or foreign governmental regulatory authorities or self-regulatory organizations, could delay or prevent a change in control, limit the price investors may be willing to pay in the future for our common stock and could entrench management.

Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws may delay or prevent a merger or acquisition that a stockholder may consider favorable by permitting Perella Weinberg Partners’ board of directors to issue one or more series of preferred stock, requiring advance notice for stockholder proposals and nominations and placing limitations on convening stockholder meetings. In addition, there will be no cumulative voting in the election of directors, and Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation will provide that, subject to the rights, if any, of the holders of shares of preferred stock then outstanding, directors may be removed from office at any time, with or without cause, by the affirmative vote of at least two-thirds (2/3) of the voting power of the shares entitled to vote in connection with the election of our directors; provided, that at any time the Class B Condition is satisfied, any or all of our directors may be removed from office at any time, with or without cause, by the affirmative vote of the holders of a majority of the voting power of the shares entitled to vote in connection with the election of our directors. These provisions may also discourage acquisition proposals or delay or prevent a change in control, which could harm Perella Weinberg Partners’ stock price. See “Description of Securities Post-Business Combination.”

Further, Perella Weinberg Partners’ two U.S. broker-dealer subsidiaries are members of FINRA and subject to FINRA’s rules, which could impede or delay a change of control. FINRA Rule 1017 generally provides that FINRA approval must be sought in connection with any transaction resulting in a single person or entity acquiring or controlling, directly or indirectly, twenty-five percent (25%) or more of a FINRA member firm’s or its parent company’s equity for the first time.

Similarly, Perella Weinberg Partners’ U.K. subsidiary, Perella Weinberg UK Limited (“PWP U.K.”), is regulated by the FCA and is, therefore, an FCA authorized person, acquisitions of interests in which are subject to change in control rules. Prior FCA approval must be obtained for any transaction that would result in a single person or entity acquiring, directly or indirectly, 10% or more of PWP U.K.’s voting rights or share capital, including through ownership of the equity of any of its parent undertakings.

Additionally, our Existing Certificate of Incorporation contains provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests. These

 

101


Table of Contents

provisions include the ability of the board of directors to designate the terms of and issue new series of preferred shares, which may make more difficult the removal of management and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities. These anti-takeover defenses could discourage, delay or prevent a transaction involving a change in control of the combined company. These provisions could also discourage proxy contests and make it more difficult for you and other stockholders to elect directors of your choosing and cause us to take corporate actions other than those you desire.

Our Existing Certificate of Incorporation provides, and Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation will provide, that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for certain stockholder limitation matters, subject to limited exceptions, which could discourage stockholder lawsuits or limit our stockholders’ ability to bring a claim in any judicial forum that they find favorable for disputes against our directors, officers, other employees or stockholders.

Our Existing Certificate of Incorporation provides and, following the Business Combination, the Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation will provide that, unless the Company or Perella Weinberg Partners, as applicable, consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will, to the fullest extent permitted by law, be the sole and exclusive forum for any stockholder to bring (i) any derivative action or proceeding brought on behalf of the Company or Perella Weinberg Partners, as applicable, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Company to the Company or the Company’s stockholders or Perella Weinberg Partners to Perella Weinberg Partners’ stockholders, as applicable, (iii) any action asserting a claim against the Company or Perella Weinberg Partners, as applicable, their directors, officers or employees arising pursuant to any provision of the DGCL or the charter or the bylaws, or (iv) any action asserting a claim against Perella Weinberg Partners, its directors, officers or employees governed by the internal affairs doctrine, and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel except (a) under our Second Amended and Restated Certificate of Incorporation, any action (A) as to which the Court of Chancery in the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, (C) for which the Court of Chancery does not have subject matter jurisdiction, or (D) any action arising under the federal securities laws, as to which the Court of Chancery and the federal district court for the District of Delaware shall have concurrent jurisdiction, and (b) under Perella Weinberg Partners’ Second Amended and Restated Certificate of Incorporation, in the event that the Court of Chancery of the State of Delaware lacks jurisdiction over any such action or proceeding, the sole and exclusive forum for such action or proceeding shall be another state or federal court located within the State of Delaware. Notwithstanding the foregoing, the choice of forum provisions will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the United States of America shall be the sole and exclusive forum. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock shall be deemed to have notice of and consented to the forum provisions in our Second Amended and Restated Certificate of Incorporation. However, no such person or entity shall be deemed to have waived any right of action against Perella Weinberg Partners or its officers or directors pursuant to the federal securities laws. If any action the subject matter of which is within the scope of the choice of forum provision is filed in a court other than a court located within the State of Delaware (a “foreign action”) in the name of any stockholder, such stockholder shall be deemed to have consented to: (x) the personal jurisdiction of the state and federal courts located within the State of Delaware in connection with any action brought in any such court to enforce the choice of forum provision (an “enforcement action”), and (y) having

 

102


Table of Contents

service of process made upon such stockholder in any such enforcement action by service upon such stockholder’s counsel in the foreign action as agent for such stockholder.

This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, other employees or stockholders, which may discourage lawsuits with respect to such claims. Alternatively, if a court were to find the choice of forum provision contained in our Second Amended and Restated Certificate of Incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, operating results and financial condition.

Risks Related to the Redemption

Public stockholders, together with any affiliates of theirs or any other person with whom they are acting in concert or as a “group,” will be restricted from exercising redemption rights with respect to more than 15% of the public shares.

A public stockholder, together with any of its affiliates or any other person with whom it is acting in concert or as a “group,” will be restricted from exercising redemption rights with respect to more than 15% of the public shares. Accordingly, if you hold more than 15% of the public shares and the Business Combination Proposal is approved, you will not be able to exercise redemption rights with respect to the full amount of your shares and may be forced to hold the shares in excess of 15% or sell them in the open market. If the Business Combination is consummated, the value of such excess shares may not appreciate over time and the market price of our common stock may not exceed the per share redemption price paid in connection with the Business Combination.

A stockholder’s decision as to whether to redeem his, her or its shares for a pro rata portion of the trust account may not put the stockholder in a better future economic position.

We can give no assurance as to the price at which a stockholder may be able to sell his, her or its public shares in the future following the completion of the Business Combination. Certain events following the consummation of any business combination, such as the Business Combination, may cause an increase in our share price, and may result in a lower value realized upon redemption than a stockholder might realize in the future had the stockholder not redeemed his, her or its shares. Similarly, if a stockholder does not redeem his, her or its shares, the stockholder will bear the risk of ownership of the public shares after the consummation of the Business Combination, and the risk that the stockholder may not be able, in the future to sell his, her or its shares, for a greater amount than the redemption price described in this proxy statement. A stockholder should consult his, her or its tax and/or financial advisor for assistance on how this may affect his, her or its individual situation.

If our stockholders fail to comply with the redemption requirements specified in this proxy statement, they will not be entitled to redeem their shares of our common stock for a pro rata portion of the funds held in our trust account.

In order to exercise redemption rights, holders of public shares are required to, among other requirements, submit a request in writing and deliver their stock (either physically or electronically) to our transfer agent at least two business days prior to the Special Meeting. Stockholders electing to redeem their public shares will receive their pro rata portion of the amount on deposit in the trust account as of two business days prior to the anticipated consummation of the Business Combination. See the section entitled “Special Meeting of FTIV Stockholders—Redemption Rights and Procedures” for additional information on how to exercise your redemption rights. If you do not timely submit your redemption request and deliver your common stock and comply with the other redemption requirements, you will not be entitled to redeem your common stock.

 

103


Table of Contents

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

Introduction

FTIV and PWP are providing the following unaudited pro forma condensed combined financial information to aid you in your analysis of the financial aspects of the business combination. The unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release No. 33-10786 “Amendments to Financial Disclosures about Acquired and Disposed Businesses” and should be read in conjunction with the accompanying notes.

The unaudited pro forma condensed combined statement of financial condition as of December 31, 2020, combines the audited balance sheet of FTIV as of December 31, 2020, with the audited consolidated statement of financial condition of PWP OpCo as of December 31, 2020, giving effect to the Business Combination and related adjustments as if they had been consummated on that date.

The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020, combines the audited statement of operations of FTIV for the year ended December 31, 2020, with the audited consolidated statement of operations of PWP OpCo for the year ended December 31, 2020. The unaudited pro forma condensed combined statement of operations give effect to the business combination and related adjustments as if they had been consummated on January 1, 2020.

The unaudited pro forma condensed combined financial information was derived from, and should be read in conjunction with, the following historical financial statements and the accompanying notes, which are included elsewhere in this proxy statement:

 

   

The historical audited financial statements of FTIV as of and for the year ended December 31, 2020; and

 

   

The historical audited consolidated financial statements of PWP OpCo as of and for the year ended December 31, 2020.

The foregoing historical financial statements have been prepared in accordance with U.S. GAAP. The unaudited pro forma condensed combined financial information has been prepared based on the aforementioned historical financial statements and the assumptions and adjustments as described in the notes to the unaudited pro forma condensed combined financial information. The pro forma adjustments are based upon available information and methodologies that are factually supportable and directly attributable to the transactions referred to below. The unaudited pro forma condensed combined financial statements are presented for illustrative purposes only and do not purport to represent Perella Weinberg Partners’ consolidated results of operations or consolidated financial position that would actually have occurred had the Transactions been consummated on the dates assumed or to project Perella Weinberg Partners’ consolidated results of operations or consolidated financial position for any future date or period.

The unaudited pro forma condensed combined financial information should also be read together with “FTIV’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “PWP’s Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and other financial information included elsewhere in this proxy statement.

 

104


Table of Contents

Description of the Business Combination

On December 29, 2020, FTIV entered into the Business Combination Agreement by and among the Sponsor, PWP OpCo, PWP GP, Professional Partners, and Professionals GP, pursuant to which, among other things, (i) FTIV will acquire certain partnership interests in PWP OpCo, (ii) PWP OpCo will become jointly-owned by the Company, Professional Partners and certain existing partners of PWP OpCo, and (iii) PWP OpCo will, following the Closing, serve as the Company’s operating partnership as part of an Up-C structure.

Pursuant to the Business Combination Agreement, subject to certain conditions set forth therein, in connection with the Closing:

(i) the Company will acquire newly-issued common units of PWP OpCo in exchange for cash in an amount equal to the outstanding excess cash balances of the Company (including the proceeds from the PIPE Investment) as of Closing, net of redemptions elected by the Company’s public stockholders pursuant to their redemption rights;

(ii) Professional Partners will contribute the equity interests of PWP GP, the general partner of PWP OpCo, to the Company;

(iii) the Company will issue new shares of Class B-1 common stock and Class B-2 common stock to PWP OpCo, with the Class B-1 common stock being distributed to and owned by Professional Partners and the Class B-2 common stock being distributed to and owned by ILPs, with the number of shares of such common stock to be issued to PWP OpCo equal the number of common units of PWP OpCo that will be held by Professional Partners and ILPs, respectively, following the Closing; and

(iv) the Company will repay certain indebtedness of PWP OpCo and its subsidiaries, and pay certain expenses, and PWP OpCo will, subject to the availability of transaction proceeds and a reasonable reserve, first redeem PWP OpCo units held by certain electing ILPs, and second, redeem PWP OpCo units held by certain Legacy Partners and retain any remaining proceeds for general corporate purposes.

Concurrently with the execution of the Business Combination Agreement, the Company also entered into a Subscription Agreement with the PIPE Investors pursuant to, and on the terms and subject to the conditions of, which the PIPE Investors have collectively subscribed for 12.5 million shares of the Company’s Class A common stock for an aggregate purchase price equal to $125 million, including $1.5 million subscribed by entities related to the Sponsor, which may be increased by up to $23.5 million. The PIPE Investment will be consummated concurrently with the Closing. The following pro forma condensed combined financial information assumes only 12,500,000 shares of Class A common stock are issued to the PIPE Investors.

At the Closing, the Company will enter into a Tax Receivable Agreement with PWP OpCo, Professional Partners and certain other persons party thereto. The Tax Receivable Agreement will generally provide for payment by the Company to ILPs and certain Partners (as defined therein) of 85% of the cash tax savings, if any, in U.S. federal, state, local and foreign income taxes and related interest realized (or deemed realized) in periods after the Closing as a result of (a) exchanges of interests in PWP OpCo for cash or stock of the Company and certain other transactions and (b) payments made under the Tax Receivable Agreement. The Company expects to retain the benefit of the remaining 15% of these cash tax savings. For additional information, see “Proposal No. 1—The Business Combination Proposal—Related Agreements—Tax Receivable Agreement” in the accompanying proxy statement.

 

105


Table of Contents

Under the No Redemptions Scenario, Perella Weinberg Partners is expected to issue 50,237,000 shares of Class B-1 and Class B-2 common stock in exchange for $0.01 per share. Under the Maximum Redemptions Scenario, Perella Weinberg Partners is expected to issue 61,060,000 shares of Class B-1 and Class B-2 common stock in exchange for $0.01 per share. The number of shares of such Class B common stock will equal the number of common units of PWP OpCo that will be held by Professional Partners and such ILPs, respectively, following the Closing, but prior to redemption of certain electing ILPs and Legacy Partners

Under the No Redemptions Scenario, Perella Weinberg Partners is expected to acquire PWP OpCo units for approximately $245.8 million of cash, inclusive of cash from the trust account and PIPE investment after the assumed redemption of PWP OpCo Units held by certain electing ILPs and assumed redemption of PWP OpCo units held by certain Legacy Partners but before any transaction costs or repayment of indebtedness. Under the Max Redemptions Scenario, Perella Weinberg Partners is expected to acquire PWP OpCo units for approximately $200.0 million of cash, inclusive of cash from the trust account and PIPE investment and before any transaction costs or repayment of indebtedness.

Upon the Closing, the ownership will be as follows:

 

Total Capitalization (in thousands)    No Redemptions
Scenario
    Maximum
Redemptions
Scenario
 

Party

   Share #      %     Share #      %  

FTIV Public Shareholders

     23,000        24.7     7,500        8.5

Shares held by Sponsor and other holders of founder shares*

     7,457        8.0     7,457        8.4
  

 

 

    

 

 

   

 

 

    

 

 

 

Total FTIV

     30,457        32.7     14,957        16.9

Professional Partners and ILPs**

     50,237        53.9     61,060        69.0

PIPE

     12,500        13.4     12,500        14.1
  

 

 

    

 

 

   

 

 

    

 

 

 

Total shares outstanding at Closing

     93,194        100.0     88,517        100.0
  

 

 

    

 

 

   

 

 

    

 

 

 

Class B-1 and Class B-2 Shares***

     50,237          61,060     

 

*

Includes 100% of Founders Shares, including those subject to performance targets.

**

The shares attributed to Professional Partners and ILPs represent ownership in the form of PWP OpCo Class A partnership units, which are exchangeable into Perella Weinberg Partners Class A common stock on a one for one basis. As Class B-1 and Class B-2 shares have de minimis economic rights, they have been excluded from the calculations in this table of Class A common stock issued upon exchange of PWP OpCo Units and Class B shares.

***

Class B-1 and Class B-2 shares will be issued, with the Class B-1 common stock being owned by Professional Partners and the Class B-2 common stock being owned by certain ILPs. Class B-1 shares will carry 10 votes per share and B-2 shares will carry 1 vote per share. As these shares have de minimis economic and participating rights, they have been excluded from the calculation of earnings per share.

Accounting for the Business Combination

The Business Combination will be accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, FTIV, who is the legal acquirer, will be treated as the “acquired” company for financial reporting purposes and PWP will be treated as the accounting acquirer. This determination was primarily based on PWP expecting to have a majority of the voting power of the post-combination company, PWP’s senior management comprising substantially all of the senior management of th