BGC Partners, Inc. (NASDAQ:BGCP) Files An 8-K Entry into a Material Definitive Agreement
ITEM1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
The information required by this Item1.01 is set forth under
Item8.01 below and is hereby incorporated by reference in
response to this Item.
ITEM5.02. DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS;
ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS;
COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.
On December14, 2016, Shaun D. Lynn, the President of BGC
Partners, Inc. (the Company), entered into an amended and
restated deed of adherence (the New Lynn Deed) with BGC Services
(Holdings) LLP (the U.K. Partnership). The Compensation Committee
of the Companys Board of Directors approved the New Lynn Deed and
a related letter agreement, dated December 14, 2016 (the Letter
Agreement), providing for a grant to Mr.Lynn of 1,000,000 NPSUs
and 3,500,000 LPUs in BGC Holdings, L.P. (the Partnership),
effective as of October1, 2016.
The New Lynn Deed provides for substantially similar terms to the
amended and restated deed of adherence to the limited liability
partnership agreement (the LLP Agreement) of the U.K. Partnership
entered into by Mr.Lynn effective as of January7, 2013 (as then
amended and restated, the Old Lynn Deed), except that (i)the
52-week rolling notice period has been replaced with a fixed term
contract expiring March31, 2023, with a 24-month advance rolling
notice period; (ii)the term of the restrictive covenants in the
Old Lynn Deed has been extended from 18 months to two years;
(iii)the profit allocation payable to Mr.Lynn in the event of a
termination due to illness or injury will be based on a pro rata
portion of the profit allocation for the prior year; and (iv)the
profit allocation payable in the event of the death of Mr.Lynn
will be payable to his estate all in cash, with the Compensation
Committee taking into consideration the portion of the year
served and the profit allocation which might have paid to Mr.Lynn
in the event that he had survived.
Further, on or about each October1 of 2017 through 2020, to the
Letter Agreement, the Partnership shall grant an aggregate award
of 250,000 non-exchangeable LPUs in replacement of 250,000 of the
above-referenced NPSUs, provided that (i)the Company, inclusive
of all affiliates thereof, earns, in the aggregate, at least
$5million in gross revenues in the calendar quarter in respect of
which the applicable award of LPUs is to be granted, and
(ii)except in the event of Mr.Lynns death prior to the applicable
grant date, Mr.Lynn remains a member in the U.K. Partnership and
has complied at all times with the New Lynn Deed and the
Agreement of Limited Partnership of BGC Holdings, L.P., Amended
and Restated as of March31, 2008 (as further amended from time to
time, the Partnership Agreement), as of the applicable grant
date. The LPUs shall be subject to customary adjustments due to
membership in the U.K. Partnership upon their exchange or
redemption (e.g., 9.75% cancellation/forfeiture upon exchange).
In the event of a change of control of the U.K. Partnership at
any time while Mr.Lynn is providing substantial services to the
Company or an affiliate thereof (the date such event takes
effect, the Change in Control), then the Partnership shall grant
exchangeable LPUs in replacement of any of the above NPSUs then
held by Mr.Lynn, and any of the above non-exchangeable LPUs then
held by Mr.Lynn shall become exchangeable for shares of the
Companys ClassA common stock as follows: (a)in a lump sum
following (i)the third anniversary of the Change of Control if
Mr.Lynn continuously provides substantial services (as an
employee, member, partner, consultant, or otherwise) to the
Company, any of the individual(s) or entity(ies) which acquire(s)
control of the Company (the Controller), or any affiliate thereof
for the three years after the Change of Control, or (ii)the date
the Controller permanently terminates Mr.Lynns services in all
capacities to the Company, the Controller, and all affiliates
thereof prior to the third anniversary of the Change of Control
if the circumstances amount to a fundamental breach of contract
by the Controller as determined by a court of competent
jurisdiction, or (b)ratably on or about the first through third
anniversaries following the Change of Control if the Controller
permanently terminates Mr.Lynns services in all capacities to the
Company, the Controller, and all affiliates thereof prior to the
third anniversary of the Change of Control unless (a)(ii) above
applies. These rights are subject to compliance by Mr.Lynn with
certain terms and conditions set forth in the applicable
agreements, including not engaging in Competitive Activity (as
such term is defined under the Partnership Agreement) at any time
prior to the applicable grant of exchangeability. The grant of
exchangeability with respect to such LPUs will be determined in
accordance with the Companys practices when determining
discretionary bonuses or awards, and any grants of
exchangeability shall be subject to the approval of the
Compensation Committee.
In addition, the Compensation Committee approved a separate
consultancy agreement between Mr.Lynn and the U.K. Partnership
dated December 14, 2016, under which Mr.Lynn will be paid a fee
of $20,833.33 per month ($250,000 per year) for his services,
commencing upon the termination of his membership in the U.K.
Partnership until the earlier of five years following such
termination or such time as the U.K. Partnership chooses to
terminate the engagement (the Consultancy Agreement). The
Consultancy Agreement subjects Mr.Lynn to substantially the same
two-year restrictive covenants as in the New Lynn Deed subsequent
to his consultancy termination.
The foregoing descriptions of the New Lynn Deed, the Consultancy
Agreement and the Letter Agreement do not purport to be complete
and are qualified in their entirety by reference to the full text
of such documents that are filed as Exhibits 10.1, 10.2 and 10.3,
respectively, to this Current Report on Form 8-K and incorporated
herein by reference.
ITEM8.01. OTHER EVENTS.
On December14, 2016, BGC GP LLC, a subsidiary of the Company and
the General Partner of the Partnership, and Cantor, the Majority
in Interest Exchangeable Limited Partner of the Partnership,
entered into the Twelfth Amendment to the Agreement of Limited
Partnership of the Partnership, effective as of October1, 2016
(the Amendment). The Amendment was entered into to amend certain
terms and conditions of the Partnerships non-distributing
partnership units (N Units) in order to provide flexibility to
the Company and the Partnership in using such N Units in
connection with compensation arrangements and practices.
The Amendment provides for a minimum $5million gross revenue
requirement in a given quarter as a condition for an N Unit to be
replaced by another type of Partnership unit in accordance with
the Partnership Agreement and the grant documentation.
The Amendment was approved by the Audit Committee of the Board of
Directors of the Company.
The foregoing description of the Amendment is qualified in its
entirety by reference to the full text of the Amendment attached
as Exhibit 10.4 to this Current Report on Form 8-K and
incorporated by reference herein.
ITEM9.01. FINANCIAL STATEMENTS AND EXHIBITS.
| (d) | Exhibits |
| 10.1 |
Amended and Restated Deed of Adherence, dated December14, 2016, between Shaun D. Lynn and BGC Services (Holdings) LLP. |
| 10.2 |
Consultancy Agreement, dated December14, 2016, between Shaun D. Lynn and BGC Services (Holdings) LLP. |
| 10.3 |
Letter Agreement, dated December14, 2016, between Shaun D. Lynn and BGC Holdings, L.P. |
| 10.4 |
Twelfth Amendment to the BGC Holdings, L.P. Agreement of Limited Partnership, as Amended and Restated, dated as of December14, 2016 and effective as of October1, 2016. |
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report on Form 8-K to be signed
on its behalf by the undersigned hereunto duly authorized.
| BGC Partners, Inc. | ||||||
| Date: December16, 2016 | By: | /s/ Howard W. Lutnick | ||||
| Name: Howard W. Lutnick | ||||||
| Title: Chairman and Chief Executive Officer |
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About BGC Partners, Inc. (NASDAQ:BGCP)
BGC Partners, Inc. (BGC) is a global brokerage company servicing the financial and real estate markets. The Company operates through two segments: Financial Services and Real Estate Services. The Company provides a range of services, including trade execution, broker-dealer services, clearing, processing, information, and other back-office services to a range of financial and non-financial institutions. Its integrated platform is designed to provide flexibility to customers with regard to price discovery, execution and processing of transactions, and enables them to use voice, hybrid, or in various markets, electronic brokerage services in connection with transactions executed either over-the-counter or through an exchange. Through the Company’s FENICS, BGC Trader, BGC Market Data and Capitalab brands, it offers electronic brokerage, financial technology solutions, market data, post-trade services, and analytics related to select financial instruments and markets. BGC Partners, Inc. (NASDAQ:BGCP) Recent Trading Information
BGC Partners, Inc. (NASDAQ:BGCP) closed its last trading session up +0.06 at 9.98 with 892,216 shares trading hands.