DEF 14A of Hamilton Lane INC, Jul 25, 2023

DEF 14A of Hamilton Lane INC

Filed Jul 25, 2023 · FY20230001433642-23-000065

Open on EDGAR

  1. How do I recommend a director nominee?

    How do I recommend a director nominee? If you wish to nominate an individual for election as director at the 2024 annual meeting of stockholders, we must receive your written nomination on or after May 10, 2024, but no later than June 9, 2024. You should send your proposal to: Hamilton Lane Incorporated, 110 Washington Street, Suite 1300, Conshohocken, PA 19428, Attention: Secretary. As detailed in our Bylaws, for a director nomination to be properly brought before an annual meeting, your notice of nomination must include: (i) the name, age, business address and residence address of each proposed nominee, (ii) the principal occupation or employment of each such nominee, (iii) the number of shares of our capital stock owned of record and beneficially by each nominee (if any), (iv) such other information concerning each nominee as would be required to be disclosed in a proxy statement soliciting proxies for the election of the nominee as a director in an election contest (even if an election contest is not involved) or that is otherwise required to be disclosed, under Section 14(a) of the Exchange Act and the rules and regulations promulgated thereunder, (v) the consent of the nominee to being named in the proxy statement as a nominee and to serving as a director if elected and (vi) certain information as specified in Section 1.12(b)(vi) of our Bylaws regarding the proposing stockholder and the beneficial owner, if any, on whose behalf the nomination is made. Notwithstanding anything in Section 1.12(a) of our Bylaws to the contrary, in the event that the number of directors to be elected to the board of directors at the annual meeting is increased effective after the time period for which nominations would otherwise be due under Section 1.12(a) and there is no public announcement by us naming the nominees for the additional directorships at least 100 days before the first anniversary of the preceding year’s annual meeting, the proposing stockholder’s notice required by Section 1.12 of the Bylaws will also be considered timely, but only with respect to nominees for the additional directorships, if it is delivered to the Secretary at our principal executive offices no later than the close of business on the tenth day following the day on which we first make the public announcement. To comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must provide notice that sets forth the information required by Rule 14a-19 under the Exchange Act no later than July 9, 2024.

  2. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS Our Amended and Restated Certificate of Incorporation provides that the number of directors to hold office at any time may be determined from time to time by resolution of our board of directors. Our board of directors has set the size of the board at seven members, four of whom have served since we became a public company in March 2017. With respect to the remaining directors, Mr. Berkman and Ms. Varon have each served on our board since May 2017, and Mr. Graves has served on our board since March 2021. Our board is divided into three classes, designated as Class I, Class II and Class III. Directors in each class are elected for a three-year term and serve until a successor is duly elected and qualified or until his or her earlier death, resignation, removal, retirement or disqualification. There is no limit on the number of terms a director may serve. The table below sets forth information with respect to our directors as of July 10, 2023:

  3. ELECTION OF DIRECTORS

    | Name | Age | | Class I Directors - Term Expiring at the 2023 Annual Meeting | | | David J. Berkman | 61 | | O. Griffith Sexton | 79 | | Class II Directors - Term Expiring at the 2024 Annual Meeting | | | R. Vann Graves | 54 | | Erik R. Hirsch | 50 | | Leslie F. Varon | 66 | | Class III Directors - Term Expiring at the 2025 Annual Meeting | | | Hartley R. Rogers | 63 | | Mario L. Giannini | 70 |

  4. ELECTION OF DIRECTORS

    The terms of our two Class I directors expire at the 2023 Annual Meeting. At the direction of HLAI, our board of directors has nominated Messrs. Berkman and Sexton for election as Class I directors. Biographical information for each director and director nominee is contained below. If elected at the Annual Meeting, each of these nominees will serve for a three-year term expiring at the 2026 annual meeting of stockholders and until his successor has been duly elected and qualified, or until his earlier death, resignation or removal. Messrs. Berkman and Sexton have agreed to serve if elected, and we have no reason to believe that either nominee will be unable to serve. If either nominee is unable to serve at the time of the Annual Meeting, proxies will be voted in favor of the other nominee and may be voted for a substitute nominee, unless our board of directors chooses to reduce the number of directors serving on our board of directors. Unless otherwise instructed, the proxy holders will vote the proxies received by them “FOR” the election of Messrs. Berkman and Sexton as Class I directors. The following is a brief biographical summary of the experience of our directors and director nominees:

  5. Nominees for election at our 2023 Annual Meeting with terms expiring in 2026

    Nominees for election at our 2023 Annual Meeting with terms expiring in 2026

  6. David J. Berkman

    David J. Berkman Mr. Berkman is a member of our board of directors and serves on its audit committee. Since January 2000, Mr. Berkman has served as the Managing Partner of Associated Partners, LP, a private equity firm engaged primarily in telecommunications infrastructure operations and investments. He serves on the boards (or equivalent bodies) of Audacy, Inc. (OTC: AUDA) (formerly, Entercom Communications Corp. (NYSE: ETM)) and on its audit and compensation (Chair) committees; Chemimage, Inc. and on its compensation committee; and WatchBanQ Group Limited. He also serves on the advisory committee of First Round Capital, a venture firm. Mr. Berkman also served on the board of overseers of the University of Pennsylvania School of Engineering and Applied Science until 2022. He served on the boards of Rotor Acquisition Corp. until 2021 and Actua Corporation until 2018. He received a B.S. in Economics from the Wharton School of the University of Pennsylvania. Mr. Berkman’s extensive experience in private markets, in the start-up and operation of various platforms, as well as his long-standing service (including holding leadership positions) on other public company boards, enables him to bring valuable investment, operations and governance knowledge to the board of directors. Additionally, his insight in the areas of corporate finance, financial reporting, and accounting and controls is valuable to the Company.

  7. O. Griffith Sexton

    O. Griffith Sexton Mr. Sexton is a member of our board of directors and serves on its audit and compensation committees. He served on the board of Hamilton Lane Advisors, L.L.C., our operating company (“HLA”), from 2003 until our initial public offering (“IPO”) in 2017. From 2000 to 2020, he was a visiting lecturer at Princeton University, where he taught courses in corporate finance, and he was an adjunct professor of finance at Columbia Business School from 1995 to 2010. Prior to working in academia, Mr. Sexton was an investment banking professional at Morgan Stanley from 1973 to 1995, where he served as a Managing Director from 1985 to 1995. His responsibilities included the development and execution of advisory assignments involving major corporate transactions such as mergers, acquisitions, divestitures, corporate defense, recapitalizations, financial restructurings, joint ventures, spin-offs and squeeze outs. He has served as an advisory director of Morgan Stanley from 1995 to 2005 and from 2014 to the present. Mr. Sexton was a member of the board of directors of Morgan Stanley from 2005 to 2014 and of Investor AB, a publicly traded Swedish investment company, from 2003 to 2015. He received a B.S.E. cum laude from Princeton and an M.B.A. from Stanford and is a former U.S. naval aviator and Vietnam veteran. Mr. Sexton’s broad experience in finance and academia brings valuable insight, an in-depth understanding of the industry and a unique perspective to the board of directors. The board of directors recommends a vote “FOR” the election of Messrs. Berkman and Sexton as Class I directors.

  8. Directors continuing in office with terms expiring in 2024

    Directors continuing in office with terms expiring in 2024

  9. R. Vann Graves

    R. Vann Graves Since 2018, Mr. Graves has served as Executive Director of the Brandcenter at Virginia Commonwealth University (“VCU”), a master’s program for advertising, branding and creative problem-solving that is part of the VCU School of Business. Prior to joining the Brandcenter, Mr. Graves served as Chief Creative Officer at the advertising agency of J. Walter Thompson, Atlanta, from 2015 to 2018; EVP, Global Executive Creative Director and Group Creative Director at the advertising agency of McCann New York from 2009 to 2015; Chief Creative Officer at the multicultural marketing and advertising agency of Uniworld Group, New York from 2007 to 2009; VP, Creative Director at the advertising agency of BBDO New York from 1993 to 2007; and he was a CoFounder at FL+G, a full-service branding agency in Denver, Colorado. Mr. Graves is also a veteran of the United States Army, where he served as Public Affairs Officer. Mr. Graves brings together creative and business expertise to the Brandcenter, having worked on some of the world’s leading global brands (including Coca-Cola, MasterCard, the U.S. Army, GE, M&M’s, Snickers and Visa). Throughout his career, he has put a high value on collaboration and commitment to support innovation and high-quality creative work. In addition to time spent on the Ad Council’s Creative Review Committee and One Club for Creativity’s AdVersity Board, he currently sits on the boards for 600 & Rising, 4A’s Foundation, Virginia Public Media and The 3% Movement. A Fulbright scholar, he received a B.B.A. from Howard University, a M.S. in Communications Design from the Pratt Institute, an A.L.M. from Harvard University and an Ed.D in Higher Education Management from the University of Pennsylvania. Mr. Graves’ work in marketing, branding and design brings valuable knowledge and insights to the board of directors.

  10. Erik R. Hirsch

    Erik R. Hirsch Mr. Hirsch has served as a Vice Chairman since 2016 and is a member of our board of directors. He is also Head of Strategic Initiatives and a member of various investment committees of HLA. Prior to becoming our Vice Chairman, he previously served as Chief Investment Officer of HLA from 2003 to 2016. Prior to becoming Chief Investment Officer, Mr. Hirsch held the positions of Managing Director, Vice President and Associate. Before joining HLA in 1999, Mr. Hirsch was a corporate investment banker in the merger and acquisition department of Brown Brothers Harriman & Co. from 1998 to 1999. From 1995 to 1998, he was a municipal financial consultant with Public Financial Management, specializing in asset securitization, strategic consulting and sport stadium financings. On HLA’s behalf, Mr. Hirsch serves on the board of directors of Novata, a technology platform that provides the private markets with environmental, social and governance data collection and benchmarking and of which Hamilton Lane is a founding member, and as an observer on the board of directors of TIFIN, a tech-enabled wealth management platform and strategic partner of HLA. He also serves as the Chief Executive Officer and President of the Snug Harbor Foundation and serves on the boards of the Sixers Youth Foundation, Kalamata’s Kitchen, the University of Virginia’s Center for Politics and the College of Arts & Sciences Foundation at the University of Virginia. He received a B.A. from the University of Virginia. Mr. Hirsch’s extensive experience in private markets, including his long tenure managing our investments as Chief Investment Officer, brings valuable industry-specific knowledge and insights to the board of directors and provides the board of directors with an in-depth understanding of our business and operations.

  11. Leslie F. Varon

    Leslie F. Varon Ms. Varon is a member of our board of directors and Chair of its audit committee. She served as Chief Financial Officer of Xerox Corporation from November 2015 through December 2016 during which time she led the restructuring of the $18 billion business process services, printing equipment, software and solutions company, including the successful spin-off of its $7 billion services business. After that transaction, she became Special Advisor to the new Xerox Chief Executive Officer until March 2017 when she retired from the company. Prior to becoming Chief Financial Officer at Xerox, she was briefly Vice President of Investor Relations from March 2015 through October 2015. Before that, she served Xerox as Vice President of Finance & Corporate Controller from July 2006 to February 2015, where she oversaw global financial operating executives and had responsibility for corporate financial planning and analysis, accounting, internal audit, risk management, global real estate and worldwide shared services centers. Earlier in her career, Ms. Varon was Vice President Finance & Operations support for Xerox’s North American business, Vice President Xerox Investor Relations and Corporate Secretary and Director of Corporate Audit. From 2006 to 2017, she served on the board of Xerox International Partners, a joint venture between Xerox Corporation and Fuji Xerox Corporation, representing Xerox Corporation’s ownership stake. Ms. Varon serves on the boards of Dentsply Sirona Inc. (Nasdaq: XRAY) and is Chair of its audit committee, and Lam Research Corporation (Nasdaq: LRCX) and is Chair of its audit committee. She received a B.A. from Binghamton University and an M.B.A. with concentrations in finance and marketing from Virginia Polytechnic Institute and State University. Ms. Varon’s extensive financial background, combined with her investor engagement and corporate governance expertise and demonstrated success in business transformation, crisis management and balance sheet optimization, brings valuable knowledge and insights to the board of directors.

  12. Directors continuing in office with terms expiring in 2025

    Directors continuing in office with terms expiring in 2025

  13. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION Our policy is to not pay director compensation to directors who are also our employees. The service period for directors is generally September to September of each year to align with our annual meeting schedule. We pay each of our non-employee directors an annual retainer of $175,000 in the form of cash, time-based restricted stock awarded under the Amended and Restated Hamilton Lane Incorporated 2017 Equity Incentive Plan (the “2017 Equity Plan”), or a combination of both, at their election. The restricted stock vests one year after the date of grant. The Chair of the audit committee also receives an additional $15,000 annual cash retainer. All members of the board of directors are reimbursed for reasonable costs and expenses incurred in attending meetings of our board of directors and its committees. For fiscal 2023 service, Messrs. Berkman and Graves elected to receive their annual retainers in cash, Mr. Sexton elected to receive his annual retainer in restricted stock and Ms. Varon elected to receive her annual retainer in equal portions of cash and restricted stock. She received her retainer for service as Chair of the audit committee in cash. The following table shows compensation paid to our non-employee directors in fiscal 2023:

  14. DIRECTOR COMPENSATION

    | Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2) | Total ($) | | David J. Berkman | $175,000 | $— | $175,000 | | R. Vann Graves | $156,042 | $— | $156,042 | | O. Griffith Sexton | $— | $170,916 | $170,916 | | Leslie F. Varon | $102,500 | $85,458 | $187,958 |

  15. DIRECTOR COMPENSATION

    (1) Reflects fees paid within fiscal year. (2) Reflects the grant date fair value of a restricted stock award made during fiscal 2023 as compensation for service on our board of directors through our 2023 Annual Meeting of Stockholders, computed in accordance with U.S. generally accepted accounting principles (“GAAP”) pertaining to equity-based compensation. See “Compensation and Benefits” in Note 2, “Summary of Significant Accounting Policies” to our consolidated financial statements included in Item 8 of our 2023 Form 10-K.

  16. Determination of Compensation for Named Executive Officers

    | Bonus Range | Percent of Bonus Paid in Time-Based Restricted Stock | | $0 to $74,999 | — | | $75,000 to $199,999 | 15% | | $200,000 to $349,999 | 20% | | $350,000 to $499,999 | 25% | | $500,000 and up | 30% |

  17. Compensation and Risk

    Compensation and Risk The HLI compensation committee annually considers potential risks when reviewing our compensation programs for all employees, including our executive officers. Based on its evaluation, the committee has concluded that the risks arising from our overall compensation policies and practices are not reasonably likely to have a material adverse effect on Hamilton Lane. Our compensation program includes elements that we believe discourage excessive risk-taking and align the compensation of our employees with the long-term performance of the firm. Compensation is a balanced mix of short-term and longer-term elements, creating diverse time horizons. For example, equity awards granted to our employees are subject to multi-year vesting conditions. Because our equity awards have multi-year vesting provisions, the actual amount of compensation realized by the recipient will be tied to the long-term performance of our Class A common stock. Pursuant to our internal policies, our employees are not permitted to buy or sell derivative securities, including for hedging purposes, or to engage in short-selling to hedge their economic risk of ownership of our Class A common stock. In addition, we only make cash payments of carried interest to our employees when profitable investments have been realized and after sufficient cash has been distributed to the investors in our funds.

  18. Summary Compensation Table

    Summary Compensation Table The following table sets forth the compensation earned for the periods indicated by our named executive officers.

  19. Summary Compensation Table

    | Name and Principal Position | Year | Salary ($) | Bonus (1) ($) | Stock Awards (2) ($) | All Other Compensation ($) | Total ($) | | Mario L. Giannini Chief Executive Officer | 2023 | 350,000 | — | — | 308,386(3) | 658,386 | | | 2022 | 350,000 | — | — | 361,477 | 711,477 | | | 2021 | 350,000 | — | — | 503,803 | 853,803 | | Atul Varma Chief Financial Officer | 2023 | 325,000 | 472,500 | 382,317 | 134,027(4) | 1,313,844 | | | 2022 | 325,000 | 575,000 | 212,355 | 178,548 | 1,290,903 | | | 2021 | 325,000 | 455,000 | 186,442 | 102,305 | 1,068,747 | | Erik R. Hirsch Vice Chairman | 2023 | 325,000 | 2,100,000 | 835,687 | 2,391,037(5) | 5,651,723 | | | 2022 | 325,000 | 2,168,750 | 784,355 | 743,333 | 4,021,438 | | | 2021 | 325,000 | 1,418,750 | 555,744 | 1,400,976 | 3,700,470 | | Juan Delgado-Moreira(6) Vice Chairman | 2023 | 319,131 | 1,395,809 | 1,059,289(7) | 1,481,215(8) | 4,255,444 | | | 2022 | 321,487 | 1,277,443 | — | 480,027 | 2,078,957 | | | 2021 | 322,486 | 1,175,041 | 358,561 | 402,174 | 2,258,261 | | Lydia Gavalis General Counsel and Secretary | 2023 | 325,000 | 385,000 | 347,502 | 77,335(9) | 1,134,837 | | | 2022 | 325,000 | 335,000 | 155,727 | 17,889 | 833,616 |

  20. Summary Compensation Table

    (1) The amount shown represents the cash portion of the annual bonus. (2) This amount represents the aggregate grant-date fair value of restricted stock awards granted as the equity portion of the annual bonus and performance stock awards, computed in accordance with U.S. GAAP pertaining to equity-based compensation. See “Compensation and Benefits” in Note 2, “Summary of Significant Accounting Policies” to our consolidated financial statements included in Item 8 of our 2023 Form 10-K. For performance stock awards, the grant date fair value reported is based upon the probable outcome of the performance conditions described in “—Compensation Discussion and Analysis—Determination of Compensation for Named Executive Officers—Equity Awards—2017 Equity Plan” for Mr. Varma and Ms. Gavalis, which is also the maximum payout possible under the awards: each, $194,290. (3) This amount represents payments received in respect of the Company’s carried interest plans of $299,236 and 401(k) contributions of $9,150. (4) This amount includes payments received in respect of the Company’s carried interest plans of $69,423, 401(k) contributions of $9,900 and a gross up payment of $54,704 in connection with taxes required to be paid for relocation assistance. (5) This amount represents payments received in respect of the Company’s carried interest plans of $2,381,137 and 401(k) contributions of $9,900. (6) Mr. Delgado-Moreira was paid in Hong Kong dollars (“HKD”), which for purposes of this presentation were converted to U.S. dollars at the average exchange rate for the 12 months ended March 31, 2023, 2022 and 2021 of 7.83, 7.77 and 7.75, respectively, U.S. dollars per HKD. (7) Mr. Delgado-Moreira’s time-based restricted stock award for fiscal 2022 service was approved by the board of directors on February 24, 2022, but the grant of that award was subject to the expiration of a notice period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”). The HSR Act notice period ended in fiscal 2023, and on April 8, 2022, Mr. Delgado-Moreira was awarded 7,248 shares of time-based restricted stock with a grant date fair value of $500,982. This amount shown includes the aforementioned award in addition to time-based restricted stock awards granted in March 2023. (8) This amount represents payments received in respect of the Company’s carried interest plans of $1,481,215 and contributions to a defined contribution plan of $2,298. (9) This amount represents payments received in respect of the Company’s carried interest plans of $67,435 and 401(k) contributions of $9,900.

  21. Grants of Plan-Based Awards in Fiscal 2023

    Grants of Plan-Based Awards in Fiscal 2023 The following table sets forth the restricted stock awards granted to our named executive officers during fiscal 2023.

  22. Grants of Plan-Based Awards in Fiscal 2023

    | | Stock Awards | | | | | | | | | | | | | Estimated Future Payouts under Equity Incentive Plan Awards | | | | | | Name | Type | Grant Date | Board Approval Date | Threshold (#) | Target (#) | Maximum (#) | All other stock awards: Number of shares of stock or units (#) | Grant date fair value of stock awards ($) | | Mario L. Giannini Chief Executive Officer | | — | — | | | | — | — | | Atul Varma Chief Financial Officer | Performance Award (1) | 9/16/2022 | 9/1/2022 | — | 6,522 | 6,522 | — | 194,290 | | | Time-based Restricted Stock | 3/14/2023 | 2/23/2023 | | | | 3,127 | 188,027 | | Erik R. Hirsch Vice Chairman | Time-based Restricted Stock | 3/14/2023 | 2/23/2023 | | | | 13,898 | 835,687 | | Juan Delgado-Moreira Vice Chairman | Time-based Restricted Stock | 4/8/2022 | 2/24/2022 | | | | 7,248(2) | 500,982 | | | Time-based Restricted Stock | 3/14/2023 | 2/23/2023 | | | | 9,285 | 558,307 | | Lydia Gavalis General Counsel and Secretary | Performance Award (1) | 9/16/2022 | 9/1/2022 | — | 6,522 | 6,522 | — | 194,290 | | | Time-based Restricted Stock | 3/14/2023 | 2/23/2023 | | | | 2,548 | 153,211 |

  23. Grants of Plan-Based Awards in Fiscal 2023

    (1) Represents Performance Awards as described in “—Compensation Discussion and Analysis—Determination of Compensation for Named Executive Officers—Equity Awards—2017 Equity Plan” above. (2) Mr. Delgado-Moreira’s award for fiscal 2022 service was approved by the board of directors on February 24, 2022, but the grant of that award was subject to the expiration of a notice period under the HSR Act. The HSR Act notice period ended in fiscal 2023, and on April 8, 2022, Mr. Delgado-Moreira was awarded 7,248 shares of time-based restricted stock. This award vests in four equal installments, with the first vesting date being April 8, 2023. In June 2023, the board of directors approved a realignment of subsequent vesting dates for this award to March 14, 2024, 2025 and 2026.

  24. Outstanding Equity Awards at 2023 Fiscal Year End

    Outstanding Equity Awards at 2023 Fiscal Year End The following table sets forth the outstanding restricted stock awards held by our named executive officers as of March 31, 2023.

  25. Outstanding Equity Awards at 2023 Fiscal Year End

    | | | Stock Awards | | | | | | Name | Type | Grant Date | Number of Shares of Stock that Have Not Vested (#) (1) | Market Value of Shares of Stock that Have Not Vested ($) (2) | Equity Incentive Plan Awards: Number of Unearned Shares That Have Not Vested (#) (3) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares That Have Not Vested ($) (2) | | Mario L. Giannini Chief Executive Officer | | — | — | — | | | | Atul Varma Chief Financial Officer | Time-based Restricted Stock | 3/14/2020 | 209 | 15,462 | | | | | Time-based Restricted Stock | 3/14/2021 | 1,119 | 82,784 | | | | | Time-based Restricted Stock | 3/14/2022 | 2,227 | 164,753 | | | | | Performance Award | 9/16/2022 | | | 6,522 | 482,498 | | | Time-based Restricted Stock | 3/14/2023 | 3,127 | 231,335 | | | | Erik R. Hirsch Vice Chairman | Time-based Restricted Stock | 3/14/2020 | 2,226 | 164,679 | | | | | Time-based Restricted Stock | 3/14/2021 | 3,336 | 246,797 | | | | | Time-based Restricted Stock | 3/14/2022 | 8,227 | 608,633 | | | | | Time-based Restricted Stock | 3/14/2023 | 13,898 | 1,028,174 | | | | Juan Delgado-Moreira Vice Chairman | Time-based Restricted Stock | 3/14/2020 | 1,566 | 115,853 | | | | | Time-based Restricted Stock | 3/14/2021 | 2,152 | 159,205 | | | | | Time-based Restricted Stock | 4/8/2022 | 7,248(4) | 536,207 | | | | | Time-based Restricted Stock | 3/14/2023 | 9,285 | 686,904 | | | | Lydia Gavalis General Counsel and Secretary | Time-based Restricted Stock | 3/14/2020 | 450 | 33,291 | | | | | Time-based Restricted Stock | 3/14/2021 | 646 | 47,791 | | | | | Time-based Restricted Stock | 3/14/2022 | 1,633 | 120,809 | | | | | Performance Award | 9/16/2022 | | | 6,522 | 482,498 | | | Time-based Restricted Stock | 3/14/2023 | 2,548 | 188,501 | | |

  26. Outstanding Equity Awards at 2023 Fiscal Year End

    (1) Unless indicated otherwise, each time-based restricted stock award vests in equal annual installments on the four successive anniversaries of the grant date. (2) The value included in this table is based on the closing stock price of our Class A common stock as of March 31, 2023, the last trading day of our fiscal year. (3) Performance Awards vest as described in “—Compensation Discussion and Analysis—Determination of Compensation for Named Executive Officers—Equity Awards—2017 Equity Plan” above. (4) Mr. Delgado-Moreira’s time-based restricted stock award for fiscal 2022 service was approved by the board of directors on February 24, 2022, but the grant of that award was subject to the expiration of a notice period under the HSR Act. The HSR Act notice period ended in fiscal 2023, and on April 8, 2022, Mr. Delgado-Moreira was awarded 7,248 shares of time-based restricted stock. This award vests in four equal installments, with the first vesting date being April 8, 2023. In June 2023, the board of directors approved a realignment of subsequent vesting dates for this award to March 14, 2024, 2025 and 2026.

  27. Option Exercises and Stock Vested in Fiscal 2023

    Option Exercises and Stock Vested in Fiscal 2023 The following table sets forth the number of shares of Class A common stock resulting from the vesting of restricted stock awards and value realized for each of our named executive officers during fiscal 2023.

  28. Option Exercises and Stock Vested in Fiscal 2023

    | | Restricted Stock Awards | | | Name | Number of shares acquired on vesting (#) | Value realized on vesting ($) | | Mario L. Giannini Chief Executive Officer | — | — | | Atul Varma Chief Financial Officer | 1,512(1) | 97,917 | | Erik R. Hirsch Vice Chairman | 10,100(2) | 654,076 | | Juan Delgado-Moreira Vice Chairman | 5,541(3) | 358,835 | | Lydia Gavalis General Counsel and Secretary | 1,877(2) | 121,555 |

  29. Option Exercises and Stock Vested in Fiscal 2023

    (1) This amount includes time-based restricted stock awards granted in fiscal 2020, 2021 and 2022. Each award vests in four equal annual installments on the four successive anniversaries of the grant date. (2) This amount includes time-based restricted stock awards granted in fiscal 2019, 2020, 2021 and 2022. Each award vests in four equal annual installments on the four successive anniversaries of the grant date. (3) This amount includes time-based restricted stock awards granted in fiscal 2019, 2020 and 2021. Each award vests in four equal annual installments on the four successive anniversaries of the grant date.

  30. Potential Payments upon Termination or Change in Control

    Potential Payments upon Termination or Change in Control

  31. Pay Ratio Disclosure

    Pay Ratio Disclosure Under SEC rules, we are required to provide information regarding the relationship between the total annual compensation of our CEO, Mr. Giannini, to that of our median employee. For the fiscal year ended March 31, 2023: •the annual total compensation of our median employee was $125,460; •the annual total compensation of Mr. Giannini was $658,386; and •the ratio of the annual total compensation of our CEO to that of our median employee was 5 to 1. To identify the median employee for the purpose of providing the information above, we examined the compensation of all of our employees (other than our CEO) as of March 31, 2023 using, based on our payroll records, a consistently applied compensation measure consisting of such employees’ annual salary and annual cash bonus. As we believe this measure reasonably reflects the annual compensation of our employees, carried interest payouts/awards, equity awards, sign-on bonuses, commissions, 401(k) and pension benefits and overtime pay were excluded from the calculation. In accordance with SEC rules, we included all employees, whether employed on a full-time or part-time basis, in this process other than 30 employees located in Canada (6), China (5), Germany (4), Israel (7), Italy (2), South Korea (5) and Sweden (1). The excluded employees represent less than 5% of our total global population of 619 employees as of March 31, 2023, consisting of 510 U.S. employees and 109 non-U.S. employees. Salaries of active employees as of March 31, 2023 who were employed for less than the full fiscal 2023 year were annualized. We reviewed all compensation in U.S. dollars, using the relevant exchange rate for any compensation paid in other currencies. In determining the annual total compensation of the median employee, we use the same methodology we use for our named executive officers for purposes of the Summary Compensation Table above. Mr. Giannini declined his fiscal 2023 year-end bonus compensation. Tax distributions made pursuant to HLA’s operating agreement, as described below under “Certain Relationships and Related-Party and Other Transactions—HLA Operating Agreement”, and payments made pursuant to the tax receivable agreement, as described below under “Certain Relationships and Related-Party and Other Transactions—Tax Receivable Agreement”, are not considered compensation and accordingly are not included in the pay ratio calculation above. Due to the flexibility afforded by Item 402(u) of Regulation S-K in the pay ratio calculation, the ratio may or may not be comparable to pay ratios presented by other companies.

  32. Pay Versus Performance

    Pay Versus Performance As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K (“Item 402(v)”), we are providing the following information regarding the relationship between executive “compensation actually paid”, as defined in Item 402(v) (“CAP”), and certain aspects of our financial performance for each of the last three completed fiscal years. For a more comprehensive description of our executive compensation program and the factors we use to determine pay for our named executive officers (“NEOs”), see the “Compensation Discussion and Analysis” section of this proxy statement. Accordingly, the table below provides information about CAP for our Principal Executive Officer (“PEO”) and the average CAP for our non-PEO NEOs alongside certain Company financial metrics during fiscal years 2023, 2022, and 2021.

  33. Pay Versus Performance

    | Year | Summary Compensation Table Total for PEO (1) ($) | Compensation Actually Paid to PEO (2) ($) | Average Summary Compensation Table Total for non-PEO NEOs (3) ($) | Average Compensation Actually Paid to non-PEO NEOs (3) ($) | Value of Initial Fixed $100 Investment Based on: | | Net Income (6) ($ millions) | Fee Related Earnings (7) ($ millions) | | | | | | | Total Shareholder Return (4) ($) | Peer Group Total Shareholder Return (5) ($) | | | | 2023 | 658,386 | 658,386 | 3,088,962 | 3,099,481 | 141.70 | 171.52 | 109.12 | 158.81 | | 2022 | 711,477 | 711,477 | 1,959,255 | 1,997,115 | 144.58 | 189.87 | 145.99 | 144.25 | | 2021 | 853,803 | 1,091,877 | 2,183,114 | 2,870,381 | 163.01 | 174.17 | 98.02 | 130.04 |

  34. Pay Versus Performance

    (1) Mr. Giannini served as PEO in all reported years. (2) To calculate CAP, the following amounts were deducted from and added to Summary Compensation Table total compensation for each of the fiscal years shown for Mr. Giannini as well as for our non-PEO NEOs in accordance with the requirements of Item 402(v)(2)(iii):

  35. Pay Versus Performance

    | | 2023 | | 2022 | | 2021 | | | | PEO ($) | Avg. Non-PEO NEOs ($) | PEO ($) | Avg. Non-PEO NEOs ($) | PEO ($) | Avg. Non-PEO NEOs ($) | | Summary Compensation Table Total | 658,386 | 3,088,962 | 711,477 | 1,959,255 | 853,803 | 2,183,114 | | Deduct amounts reported in the Stock Awards column of Summary Compensation Table(x) | — | 656,199 | — | 230,487 | — | 343,323 | | Add fair value(y) of current year equity awards at end of current fiscal year | — | 729,244 | — | 341,195 | — | 349,342 | | Add change in fair value(y) of prior years' equity awards that remained outstanding and unvested at end of current fiscal year | — | (15,720) | — | (57,354) | — | 357,387 | | Add change in fair value(y) of prior years' equity awards that vested during current fiscal year | — | (46,806) | — | (15,494) | 238,074 | 323,861 | | CAP Total(z) | 658,386 | 3,099,481 | 711,477 | 1,997,115 | 1,091,877 | 2,870,381 |

  36. Pay Versus Performance

    (x) Reflects the grant date fair value of equity-based awards as discussed in the Summary Compensation Table and the Grants of Plan-Based Awards table for each fiscal year shown. (y) Reflects the measurement date fair value of equity-based awards, measured in accordance with ASC Topic 718 and in accordance with the SEC’s methodology for determining CAP for each fiscal year shown. The valuation methods and underlying assumptions are consistent with those disclosed in our financial statements as of the grant date for each award, including awards subject to performance conditions which are valued at the probable outcome of the award at each measurement date, and are further described in “Compensation and Benefits” in Note 2, “Summary of Significant Accounting Policies” to our consolidated financial statements included in Item 8 of our 2023 Form 10-K. For performance stock awards, the grant date fair value reported is based upon the probable outcome of the performance conditions described in “—Compensation Discussion and Analysis—Determination of Compensation for Named Executive Officers—Compensation Elements—Equity Awards—2017 Equity Plan”. (z) All applicable adjustments are listed herein. Regarding those items referenced in Item 402(v) that are not reflected: (1) no equity awards were granted during the fiscal years shown that vested within the same fiscal year; (2) dividend equivalent share accruals and vestings are not broken out separately as they are included in the fair value of the equity award to which they apply; (3) no equity awards were modified during the fiscal years shown; (4) the Company does not offer pension plans to U.S.-based employees; and (5) no equity awards failed to meet the applicable vesting conditions during the fiscal years shown. (3) The non-PEO NEOs were the following individuals for each of the fiscal years shown: 2023 – Mr. Varma, Mr. Hirsch, Mr. Delgado-Moreira and Ms. Gavalis; 2022 – Mr. Varma, Mr. Hirsch, Mr. Delgado-Moreira, Ms. Gavalis and Mr. Lucey; and 2021 – Mr. Varma, Mr. Hirsch, Mr. Delgado-Moreira and Mr. Lucey, collectively, our non-PEO NEOs for each covered year as reported in the “Total” column of the “Summary Compensation Table” in this and prior years’ proxy statements. (4) Total shareholder return (“TSR”) as calculated based on a fixed investment of $100 in our Class A common stock measured from the market close on March 31, 2020 (the last trading day of fiscal 2020) through and including the end of the fiscal year for each year reported in the table. (5) Total shareholder return as calculated based on a fixed investment of $100 in the Dow Jones U.S. Asset Managers Index. (6) “Net Income” as reported in our Annual Report on Form 10-K for the fiscal years ended March 31, 2023, 2022, and 2021. (7) For purposes of Item 402(v)(2)(iii), we have identified Fee Related Earnings (“FRE”) as our Company-Selected Measure. FRE is described in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations”—“Non-GAAP Financial Measures” of our 2023 Form 10-K. For a reconciliation of FRE to our Net Income for the relevant periods, please see Appendix A.