4.6.3: Official Definition
A persistent transient failure is one in which the message as sent is valid, but persistence of some temporary condition has caused abandonment or delay of attempts to send the message. If this code accompanies a delivery failure report, sending in the future may be successful.
The message content must be converted in order to be forwarded but such conversion is not possible or is not practical by a host in the forwarding path. This condition may result when an ESMTP gateway supports 8bit transport but is not able to downgrade the message to 7 bit as required for the next hop.