SCHEDULE: Houlihan Lokey Voting Trust Amends Terms, Reduces Holdings

Houlihan Lokey's A&R Voting Trust updated its agreement and reported a net decrease of 412,933 Class B shares due to various transactions including sales and donations.

Summary

• The A&R Voting Trust, along with Scott Joseph Adelson, Scott L Beiser, and Irwin Gold, collectively beneficially own 15,799,172 shares of Class B common stock, representing 22.5% of the class as of December 30, 2025.
• This beneficial ownership includes 437,545 shares of Class B common stock issuable upon vesting of restricted stock units.
• Between August 28, 2025, and December 30, 2025, there was a net decrease of 412,933 shares of Class B common stock in the A&R Voting Trust.
• The decrease resulted from: (i) conversion and subsequent donation or estate planning transfer of 101,960 Class B shares, (ii) forfeiture of 50,260 Class B shares due to employment terminations, (iii) withholding of 2,527 Class B shares for taxes, and (iv) conversion and subsequent open market sale of 309,374 Class B shares.
• Offsetting increases included the issuance of 27,671 vested Class B shares from acquisitions, granting of 19,877 Class B shares from new equity incentive awards, and issuance of restricted stock units convertible into 3,640 Class B shares.
• Individual dispositive power is retained by the trustees: Mr. Adelson controls 878,921 Class B shares (1.6% of Class A), Mr. Beiser controls 800,413 Class B shares (1.5% of Class A), and Mr. Gold controls 1,066,385 Class B shares (1.9% of Class A).
• The A&R Voting Trust Agreement was amended and restated, revising termination provisions and adding new rules for voting excess shares and employee withdrawals.

Sentiment

Score: 4

Explanation: The filing reports a net decrease in shares held by the voting trust, partly due to insider sales and forfeitures, which could be viewed negatively. However, it also includes new equity awards and expanded withdrawal flexibility, and the trust agreement amendments clarify long-term governance.

Positives

• New equity incentive awards totaling 19,877 Class B shares were granted.
• Restricted stock units convertible into 3,640 Class B shares were issued.
• The A&R Voting Trust Agreement expanded circumstances for employees to withdraw shares, including for pledging, hedging, monetization, or similar transactions, subject to the insider trading policy.
• A new provision allows former employees (not employed for at least 12 months) to have their shares released from the trust after the Final Conversion Date.

Negatives

• A net decrease of 412,933 shares of Class B common stock was reported in the A&R Voting Trust.
• This decrease includes the conversion and subsequent open market sale of 309,374 Class B shares, indicating some insider selling activity.
• Forfeiture of 50,260 Class B shares occurred due to employment terminations.

Future Outlook

The amended and restated A&R Voting Trust Agreement outlines future termination conditions, which include the earliest of (i) written agreement of the Issuer and Trustees, (ii) 10 years after the Final Conversion Date (when all Class B converts to Class A), or (iii) when the trust holds less than 5% of total outstanding common stock. It also establishes future voting rules for 'Excess Shares' if the trust holds more than 30% of total outstanding common stock after the Final Conversion Date.

Industry Context

This filing primarily details company-specific changes to its ownership structure and corporate governance through an amended voting trust agreement. It does not provide information directly related to broader industry trends or competitive landscape.

Corporate Governance

Related Party Transactions

• Mr. Gold, a trustee, converted an aggregate of 6,811 shares of Class B common stock into Class A common stock and subsequently sold such shares of Class A common stock.
• Mr. Gold also converted an aggregate of 5,000 shares of Class B common stock into Class A common stock and subsequently donated such shares of Class A common stock.
• Mr. Beiser, a trustee, converted an aggregate of 8,000 shares of Class B common stock into Class A common stock and subsequently donated such shares of Class A common stock.
• The A&R Voting Trust Agreement itself is a related party arrangement, governing the voting control of significant Class B common stock held by key individuals (Messrs. Adelson, Beiser, and Gold as Trustees).

Stakeholder Impact

• Shareholders: The net decrease in shares held by the voting trust, including open market sales by trustees, could be perceived as a slight reduction in insider commitment or a natural part of equity management. The amended voting trust agreement clarifies future governance and potential shifts in voting power.
• Employees: New equity incentive awards were granted (19,877 Class B shares), and restricted stock units were issued (3,640 Class B shares). Expanded withdrawal circumstances for shares from the trust offer greater flexibility for employees to manage their equity.
• Former Employees: A new provision allows former employees to have their shares released from the trust after the Final Conversion Date, providing a clearer path for liquidity.

Next Steps

• The A&R Voting Trust Agreement will terminate upon the earliest of (i) written agreement of the Issuer and Trustees, (ii) 10 years after the Final Conversion Date (when all Class B converts to Class A), or (iii) when the trust holds less than 5% of total outstanding common stock.
• If the trust holds more than 30% of total outstanding common stock after the Final Conversion Date, trustees will vote 'Excess Shares' proportionally to other stockholders.
• Former employees (not employed for at least 12 months) will be allowed to have their shares released from the trust after the Final Conversion Date.

Key Dates

Recommendation

The filing details a routine amendment to a long-standing voting trust agreement and a net decrease in shares held by the trust, including some insider sales. While insider sales can sometimes be a negative signal, the overall changes appear to be part of ongoing equity management and governance evolution rather than a fundamental shift in company prospects. The expanded flexibility for employees and clarification of future trust termination conditions are neutral to slightly positive. Given no major operational or financial news, a 'hold' recommendation is appropriate as investors should monitor future filings for more substantive operational updates.

Keywords

Houlihan Lokey, HL, Voting Trust, Class B common stock, Class A common stock, beneficial ownership, corporate governance, equity awards, insider transactions, SEC filing, Schedule 13D