ALLIANCEBERNSTEIN L.P. (NYSE:AB) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
AllianceBernstein Corporation (Corporation) is the general
partner of AllianceBernstein Holding L.P. (AB Holding) and
AllianceBernstein L.P. (AllianceBernstein and, together with the
Corporation and AB Holding, AB). AB Holdings and
AllianceBernsteins activities are managed and controlled by the
Corporation. The board of directors of the Corporation (the
Board) acts as the board of directors for each of AB Holding and
AllianceBernstein. Equitable Holdings, LLC (the Stockholder) is
the sole stockholder of the Corporation.
partner of AllianceBernstein Holding L.P. (AB Holding) and
AllianceBernstein L.P. (AllianceBernstein and, together with the
Corporation and AB Holding, AB). AB Holdings and
AllianceBernsteins activities are managed and controlled by the
Corporation. The board of directors of the Corporation (the
Board) acts as the board of directors for each of AB Holding and
AllianceBernstein. Equitable Holdings, LLC (the Stockholder) is
the sole stockholder of the Corporation.
Board Changes
On April 28, 2017, the Stockholder acted by written consent to
remove the following nine directors from the Board: Christopher
M. Condron, Steven G. Elliott, Deborah S. Hechinger, Weston M.
Hicks, Heidi S. Messer, Scott A. Schoen, Lorie A. Slutsky, Joshua
A. Weinreich and Peter S. Kraus. Following this action by the
Stockholder, Denis Duverne and Mark Pearson remain on the Board.
remove the following nine directors from the Board: Christopher
M. Condron, Steven G. Elliott, Deborah S. Hechinger, Weston M.
Hicks, Heidi S. Messer, Scott A. Schoen, Lorie A. Slutsky, Joshua
A. Weinreich and Peter S. Kraus. Following this action by the
Stockholder, Denis Duverne and Mark Pearson remain on the Board.
On April 29, 2017, the Stockholder acted by written consent to
elect the following six directors to the Board: Seth Bernstein,
Ramon de Oliveira, Barbara Fallon-Walsh, Daniel Kaye, Anders
Malmstrm and Robert Zoellick to the Board. These six directors
join Denis Duverne and Mark Pearson on the eight-member Board.
Robert Zoellick was named Chairman of the Board. Daniel Kaye,
Barbara Fallon-Walsh and Ramon de Oliveira were appointed to the
Audit Committee. Barbara Fallon-Walsh and Seth Bernstein were
appointed to, and will join Denis Duverne on, the Corporate
Governance Committee. Robert Zoellick, Barbara Fallon-Walsh and
Daniel Kaye were appointed to, and will join Denis Duverne on,
the Compensation Committee. Seth Bernstein and Ramon de Oliveira
were appointed to, and will join Denis Duverne on, the Executive
Committee. In connection with his appointment to Chairman of the
Board, Mr. Zoellick will receive an annual cash fee of $425,000,
paid quarterly, and an annual equity-based grant with a grant
date fair value equal to $425,000. A copy of the non-executive
chairman agreement is attached to this report as Exhibit 10.1 and
is incorporated herein by reference. Messrs. de Oliveira and Kaye
and Ms. Fallon-Walsh will receive compensation for non-employee
directors as described in ABs 2016 Annual Report on Form 10-K
under Director Compensation in 2016.
elect the following six directors to the Board: Seth Bernstein,
Ramon de Oliveira, Barbara Fallon-Walsh, Daniel Kaye, Anders
Malmstrm and Robert Zoellick to the Board. These six directors
join Denis Duverne and Mark Pearson on the eight-member Board.
Robert Zoellick was named Chairman of the Board. Daniel Kaye,
Barbara Fallon-Walsh and Ramon de Oliveira were appointed to the
Audit Committee. Barbara Fallon-Walsh and Seth Bernstein were
appointed to, and will join Denis Duverne on, the Corporate
Governance Committee. Robert Zoellick, Barbara Fallon-Walsh and
Daniel Kaye were appointed to, and will join Denis Duverne on,
the Compensation Committee. Seth Bernstein and Ramon de Oliveira
were appointed to, and will join Denis Duverne on, the Executive
Committee. In connection with his appointment to Chairman of the
Board, Mr. Zoellick will receive an annual cash fee of $425,000,
paid quarterly, and an annual equity-based grant with a grant
date fair value equal to $425,000. A copy of the non-executive
chairman agreement is attached to this report as Exhibit 10.1 and
is incorporated herein by reference. Messrs. de Oliveira and Kaye
and Ms. Fallon-Walsh will receive compensation for non-employee
directors as described in ABs 2016 Annual Report on Form 10-K
under Director Compensation in 2016.
CEO Transition
On April 28, 2017, the Board terminated Peter S. Kraus from his
position as Chief Executive Officer of AB. In connection with his
termination, Mr. Kraus entered into a cooperation letter with AB
to which he is entitled to termination benefits as set forth in
his employment agreement with AB and an amount equal to the
salary he would have earned through the expiration of his
employment agreement. A copy of the cooperation letter is
attached to this report as Exhibit 10.2 and is incorporated
herein by reference.
position as Chief Executive Officer of AB. In connection with his
termination, Mr. Kraus entered into a cooperation letter with AB
to which he is entitled to termination benefits as set forth in
his employment agreement with AB and an amount equal to the
salary he would have earned through the expiration of his
employment agreement. A copy of the cooperation letter is
attached to this report as Exhibit 10.2 and is incorporated
herein by reference.
Seth Bernstein, age 55, was appointed as President and Chief
Executive Officer of AB to provide services to an employment
agreement effective May 1, 2017. From 2014 to 2017, Mr. Bernstein
was Managing Director and Global Head of Managed Solutions and
Strategy at JPMorgan Asset Management. In this role, he was
responsible for the management of all discretionary assets within
the Private Banking client segment. From 2012 to 2014, Mr.
Bernstein was Managing Director and Global Head of Asset
Management Solutions for JPMorgan Chase Co. Among other roles,
Mr. Bernstein was Managing Director and Global Head of Fixed
Income Currency from 2002 to 2012. Previously, Mr. Bernstein
served as Chief Financial Officer at JPMorgan Chases investment
management and private banking division. He is a member of the
Board of Managers of Haverford College. Mr. Bernstein brings to
the board of directors extensive knowledge of the asset
management industry and extensive experience in financial
services, including as a result of his 32-year career at JPMorgan
Chase Co. AB entered into an employment agreement with Mr.
Bernstein, to which Mr. Bernstein will receive a base salary of
$500,000 per year and a target cash bonus opportunity of
$3,000,000 per year (which for 2017 will also be his minimum cash
bonus). In connection with his commencement of employment, Mr.
Bernstein will be granted restricted units in respect of limited
partnership units in AB Holding with a grant date fair value of
$3,500,000. Subject to accelerated vesting clauses in the
employment agreement (e.g., by reason of AXA ceasing to control
the management of ABs business or AB Holding ceasing to be
publicly traded and certain qualifying terminations of
Executive Officer of AB to provide services to an employment
agreement effective May 1, 2017. From 2014 to 2017, Mr. Bernstein
was Managing Director and Global Head of Managed Solutions and
Strategy at JPMorgan Asset Management. In this role, he was
responsible for the management of all discretionary assets within
the Private Banking client segment. From 2012 to 2014, Mr.
Bernstein was Managing Director and Global Head of Asset
Management Solutions for JPMorgan Chase Co. Among other roles,
Mr. Bernstein was Managing Director and Global Head of Fixed
Income Currency from 2002 to 2012. Previously, Mr. Bernstein
served as Chief Financial Officer at JPMorgan Chases investment
management and private banking division. He is a member of the
Board of Managers of Haverford College. Mr. Bernstein brings to
the board of directors extensive knowledge of the asset
management industry and extensive experience in financial
services, including as a result of his 32-year career at JPMorgan
Chase Co. AB entered into an employment agreement with Mr.
Bernstein, to which Mr. Bernstein will receive a base salary of
$500,000 per year and a target cash bonus opportunity of
$3,000,000 per year (which for 2017 will also be his minimum cash
bonus). In connection with his commencement of employment, Mr.
Bernstein will be granted restricted units in respect of limited
partnership units in AB Holding with a grant date fair value of
$3,500,000. Subject to accelerated vesting clauses in the
employment agreement (e.g., by reason of AXA ceasing to control
the management of ABs business or AB Holding ceasing to be
publicly traded and certain qualifying terminations of
employment), the restricted units granted to Mr. Bernstein will
vest ratably on each of the first four anniversaries of his
commencement date subject to Mr. Bernsteins continued
employment with AB through the applicable vesting date. Mr.
Bernstein will be eligible for cash distributions on his
unvested and vested restricted units beginning on the grant
date paid at the same time as cash distributions are paid to
holders of limited partnership units generally. Commencing in
2018, Mr. Bernstein will be eligible for annual equity-based
awards in respect of AB Holding with a grant date fair value
equal to $3,500,000. The term of the employment agreement is
three years beginning on May 1, 2017, which will automatically
extend for additional one-year periods unless either party
provides at least 90 days written notice. Upon certain
qualifying terminations of employment, Mr. Bernstein is
entitled to severance payments and benefits as set forth in the
employment agreement. Mr. Bernstein is subject to a
confidentiality provision, in addition to covenants with
respect to noncompetition and nonsolicitation of customers and
employees during employment and for six months and twelve
months, respectively, following his termination of employment.
A copy of the employment agreement is attached to this report
as Exhibit 10.3 and is incorporated herein by reference.
vest ratably on each of the first four anniversaries of his
commencement date subject to Mr. Bernsteins continued
employment with AB through the applicable vesting date. Mr.
Bernstein will be eligible for cash distributions on his
unvested and vested restricted units beginning on the grant
date paid at the same time as cash distributions are paid to
holders of limited partnership units generally. Commencing in
2018, Mr. Bernstein will be eligible for annual equity-based
awards in respect of AB Holding with a grant date fair value
equal to $3,500,000. The term of the employment agreement is
three years beginning on May 1, 2017, which will automatically
extend for additional one-year periods unless either party
provides at least 90 days written notice. Upon certain
qualifying terminations of employment, Mr. Bernstein is
entitled to severance payments and benefits as set forth in the
employment agreement. Mr. Bernstein is subject to a
confidentiality provision, in addition to covenants with
respect to noncompetition and nonsolicitation of customers and
employees during employment and for six months and twelve
months, respectively, following his termination of employment.
A copy of the employment agreement is attached to this report
as Exhibit 10.3 and is incorporated herein by reference.
A copy of ABs press release announcing these leadership changes
is attached to this report as Exhibit 99.1 and is incorporated
herein by reference.
is attached to this report as Exhibit 99.1 and is incorporated
herein by reference.
AXA Unit Purchase Agreement with Mr. Kraus
On April 30, 2017, AXA America Holdings, Inc. (AXA America), an
indirect parent of the Stockholder, entered into a unit
purchase agreement with Mr. Kraus covering all of the AB
Holding units beneficially owned by Mr. Kraus. Mr. Kraus
beneficially owns 4,337,643 AB Holding units. to the unit
purchase agreement, AXA America has agreed to purchase from Mr.
Kraus, and Mr. Kraus has agreed to sell to AXA America, on
September 1, 2017, the AB Holding units owned by Mr. Kraus as
of the close of business on April 28, 2017 at a purchase price
of $22.90 per unit (not including restricted AB Holding units
(the Restricted Units) to be delivered at specified future
dates to Mr. Kraus in accordance with the terms of his
employment agreement or with respect to which he has deferred
delivery). As to the Restricted Units, AXA America and Mr.
Kraus have agreed to call and put options, respectively, at
specified future market prices if the AB Holding units are
trading within a specified trading price range, and Mr. Kraus
has granted AXA America a right of first refusal on future
sales of Restricted Units by Mr. Kraus if the market price of
the AB Holding units is outside of such specified trading price
range, in each case as further described in the unit purchase
agreement. A copy of the unit purchase agreement is attached to
this report as Exhibit 10.4 and is incorporated herein by
reference.
indirect parent of the Stockholder, entered into a unit
purchase agreement with Mr. Kraus covering all of the AB
Holding units beneficially owned by Mr. Kraus. Mr. Kraus
beneficially owns 4,337,643 AB Holding units. to the unit
purchase agreement, AXA America has agreed to purchase from Mr.
Kraus, and Mr. Kraus has agreed to sell to AXA America, on
September 1, 2017, the AB Holding units owned by Mr. Kraus as
of the close of business on April 28, 2017 at a purchase price
of $22.90 per unit (not including restricted AB Holding units
(the Restricted Units) to be delivered at specified future
dates to Mr. Kraus in accordance with the terms of his
employment agreement or with respect to which he has deferred
delivery). As to the Restricted Units, AXA America and Mr.
Kraus have agreed to call and put options, respectively, at
specified future market prices if the AB Holding units are
trading within a specified trading price range, and Mr. Kraus
has granted AXA America a right of first refusal on future
sales of Restricted Units by Mr. Kraus if the market price of
the AB Holding units is outside of such specified trading price
range, in each case as further described in the unit purchase
agreement. A copy of the unit purchase agreement is attached to
this report as Exhibit 10.4 and is incorporated herein by
reference.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
|
Exhibit No.
|
Description
|
|
10.1
|
Non-Executive Chairman Agreement between Robert
Zoellick and AllianceBernstein Corporation |
|
10.2
|
Cooperation Letter among Peter S. Kraus,
AllianceBernstein Holding L.P., AllianceBernstein L.P. and AllianceBernstein Corporation |
|
10.3
|
Employment Agreement among Seth Bernstein,
AllianceBernstein Holding L.P., AllianceBernstein L.P. and AllianceBernstein Corporation |
|
10.4
|
Unit Purchase Agreement between AXA America Holdings,
Inc. and Peter S. Kraus |
|
99.1
|
Press release
|
23851047v1
to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
ALLIANCEBERNSTEIN L.P. > BY: /s/ David M. Lesser >
David M. Lesser> Corporate Secretary
David M. Lesser> Corporate Secretary
Date: May 1, 2017
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About ALLIANCEBERNSTEIN L.P. (NYSE:AB)
AllianceBernstein Holding L.P. is engaged in providing research, investment management and related services to a range of clients through its three buy-side distribution channels: Institutions, Retail and Private Wealth Management, and its sell-side business, Bernstein Research Services. The Company offers a range of investment services, including equity strategies, with global and regional portfolios across capitalization ranges and investment strategies, including value, growth and equities; traditional and unconstrained fixed income strategies, including taxable and tax-exempt strategies; passive management, including index and enhanced index strategies; alternative investments, including hedge funds, fund of funds and private equity, and multi-asset solutions and services, including dynamic asset allocation, customized target-date funds and target-risk funds. The Company’s services span various investment disciplines, including market capitalization, term and geographic locations. ALLIANCEBERNSTEIN L.P. (NYSE:AB) Recent Trading Information
ALLIANCEBERNSTEIN L.P. (NYSE:AB) closed its last trading session up +0.10 at 22.90 with 453,684 shares trading hands.
